Almost half of Asian CEOs believe their current business will not survive ten years on their current path. Reinvent or risk obsolescence. As technological disruptions, regulatory shifts, and market volatility compel business leaders to think afresh, Southeast Asia presents unparalleled opportunity for creating new businesses.
The emergence of a 140 million-strong consumer class by 2030 represents an untapped market that could reach $4 trillion. Yet, the path to new business opportunity creation, especially in culturally vibrant markets of Southeast Asia, requires a mindset shift. Executives need to move beyond performative initiatives based on superficial cultural awareness and one-size-fits-all approaches to business development that unwittingly homogenise diverse markets.
Here are four often overlooked considerations to unlock new business opportunities.
From Pretentions to Practice: The Power of Authentic Cultural Immersion
Traditional “Doing Business in…” programmes and other generic cultural guides too often paint over diverse and complex cultures with a broad brush, boiling centuries of nuance into soundbites. Such approaches risk perpetuating a false sense of security while often failing to address real-world complexities.
Likewise, second-hand insights from external consultants belie the true topography of rapidly evolving markets, offering a placebic comprehension of culture. A common pattern to avoid is grafting developed market models onto situations with underdeveloped infrastructure, or where customers have different priorities. In remote parts of ASEAN, promising telemedicine apps that are rendered nonfunctional due to weak connectivity are just one amongst many examples.
At the Global Institute For Tomorrow (GIFT), we believe that true understanding of markets comes from familiarising business leaders with the texture of different cultures through practical, outcome-driven immersion. Only through first-hand, on-ground exposure within the local ecosystem (i.e. SMEs, policymakers, communities) can business leaders uncover and begin to decipher the unwritten rules of business and society. Anything less leads to a poor approximation of an unknown culture.
Legacy strategies are often repurposed in new business models, hamstringing real value creation. Immersing business owners and internal technical experts in local culture provides invaluable insights upon which to innovate. It also fosters a sense of collective ownership, an intangible asset often lost in fragmented, top-down approaches or in those delivered by consultants who are distanced from the organisation.
On a recent project in rural Malaysia, a team of business leaders we worked with noted how the immersion into the day-to-day lives of the indigenous people provided unexpected realisations not accessible in regional centres like Hong Kong and Singapore. The granular insight into the lives of the Orang Asli villagers helped them develop a new business framework that scaled access to digital health tools, addressing their specific needs.
Internal Stakeholder Ownership: Fostering Drive via Purpose
A sense of ownership is the foundation for true collaboration and effective execution. Top-down planning often engenders siloed thinking, alienating staff from purposeful follow-through and, in extreme cases, reducing them to feeling like a cog in the system. Relying on external consultants for analysis and planning similarly reduces agency for those who must execute on the plan.
In contrast, cross-functional, collaborative business ideation embeds a personal sense of purpose leading to tailored business outputs everyone can get onboard with. Importantly, it enables sustained personal motivation.
Hands-on work in unfamiliar markets not only tests the capabilities of business leaders but also fosters a deep connection with the project, motivating them to solve its problems as if they were their own. This sense of ownership nurtures an entrepreneurial mindset beyond those tasked with new business development, translating to an overall agility and culture of being responsive to changing market dynamics.
External Stakeholder Ownership: Ensuring Equitable and Sustained Commitment
Perhaps most important for business success, genuine external stakeholder ownership ensures long-term collaboration and commitment from those upon whom success depends. Too often new commercial ventures are rooted in an outdated, extractive mindset that relegates local business partners to a marginal position with no real equity. Legacy approaches to value allocation, at best, result in unpredictable commitment. At worst, it places organisations on the wrong side of history, reinforcing exploitative and extractive power dynamics while marginalising local communities.
A biting example is the global value chain for chocolate, where cocoa farmers still on average earn 6 cents for every dollar spent on a bar of chocolate. It applies in other industries where primary producers and supply chain operators are seen merely as costs to be minimised.
Instead, external stakeholders need to be given a real stake in the business, whether through innovative models of equity or profit-sharing. Offering genuine financial upside helps build enduring relationships and sustainable markets that set up organisations for long-term success.
From Value Extraction to Value Creation
Investing in commercial activity to meet unmet needs is a rich area of new value creation. While admittedly not easy, addressing challenges like access to housing, electricity, healthcare, water, and food security represents a bold, if not new, frontier for regional businesses.
The practical impact of such an approach was exemplified by a leading manufacturer of electric vehicle motors with whom we worked in the Philippines. The fourth largest economy in ASEAN, the Philippines still has roughly 2.7 million households living in off-grid or poor-grid environments. Owing to its archipelagic nature with over 7000 islands, expanding the main grid to all areas is near impossible. Partnering with established leading renewable energy providers in Philippines produced a bold and viable business model for distributed renewable energy solutions to replace diesel generators to address energy needs in remote regions. It required deep cultural understanding and willingness to pioneer new equitable local relationships.
Your Catalyst for Business Re-invention
In an era of rapid change, adaptation is a prerequisite for survival. To reinvent, businesses must move from the strategies of old and embrace a stakeholder-centric approach that champions authentic collaboration and in-depth cultural immersion.
This presents myriad questions for business leaders. Perhaps most urgently:
Are we ready to move beyond outmoded, outdated thinking? If not, do we risk getting sidelined by others who are?
True strategic transformation cannot be outsourced to consultants; it is cultivated from within. By leveraging internal expertise, access to local partners, and unflinching facilitation, you can unlock the powerful, actionable opportunities needed to thrive in the 21st century.
Eric Stryson is Managing Director of the Global Institute For Tomorrow (GIFT) in Hong Kong. He possesses expertise in governance, business model innovation, leadership transformation, talent development, and sustainability. He coaches leaders from business, government, and civil society to critically examine their roles, look beyond conventional wisdom, deepen their understanding of global issues, and take ownership of their impact on their organisations and society at large.
