Foshan incubation network_greater_bay_area_prof_dr_filipe_castro_soeiro_april_2018

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All copyrights © reserved to the author Prof. Dr. Filipe Castro Soeiro | 2017- 2018
Prof. Dr. Filipe Castro Soeiro
filipe.castrosoeiro@usj.edu.mo
https://www.linkedin.com/in/filipecastrosoeiro
Mobile phone: +351 962015247
Greater Bay Area and the new role of Network Incubators in Digital Ecosystems
– Challenges and Opportunities

2All copyrights © reserved to the author Prof. Dr. Filipe Castro Soeiro | 2017- 2018
 Digital Ecosystems – Disruptive, Sustained and Efficient
Innovation systems
 Greater Bay Area Smart Region and Smart Cities – A new
Innovation and Growth Strategy
 Global Value Chains and the new role of Network Incubators in
Digital Ecosystems

Innovation systems
 Global Value Chains and the new role of Network Incubator in
Digital Ecosystems

Problem of Perception
We tend to overestimate the
impact of big changes in the
short run and underestimate in
the long run.
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There is a macro referential paradigm change from an Economy essentially focused on Natural Resources and
Physical inputs to one based on Knowledge, Intellectual assets, Technology Market transfer and commercialization
of innovation to generate new “Innovation Waves” that originate Disruptive Innovation, Sustained Innovation and
Efficiency Innovation, and create value for the Stakeholders of the Ecosystem.
New Scientific Knowledge = Engineering and Economic Knowledge? (Economic Growth, Value Added, Job Creation,
Wealth creation, Welfare?)

Key Trends #1. Network Everything (2010-2025)
#1
Everything Smart
Everything Connected
Everything Digital
(aka Internet of Things)
Source: Ashok Rao & Filipe Castro Soeiro (Chair), Entrepreneurial Journey Conference, Laureate International Universities, Lisbon, 2015

Key Trend #2 Big Data Getting Bigger
Source: Ashok Rao & Filipe Castro Soeiro (Chair), Entrepreneurial Journey Conference, Laureate International Universities, Lisbon, 2015
All copyrights © reserved to the author Prof. Dr. Filipe Castro Soeiro | 2017- 2018 6

Key Trends #3 Mobile Computing
Source: Ashok Rao, Filipe Castro Soeiro (Chair), Entrepreneurial Journey Conference, Laureate International Universities, Lisbon, 2015

Key Trends # 4. Security and Privacy
– New Laws coming in US, China and EU

Key Trends # 5. More Globalization
(The Flat World)

Key Trend # 6. Small is Getting Smaller

Key Trend # 7. Fast Disappearing Line between Virtual and Real
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Genome editing (GEEN) - type of genetic engineering in which DNA is inserted, deleted or
replaced in the genome of an organism using engineered nucleases, or "molecular
scissors” digitally and computer assisted.
Key Trend # 8. Extension of the life molecule with the
Genome editing digitally assisted
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Key Trend # 9. Breakthrough materials extend performance
technology
Breakthrough materials (e.g. yolk-and-shell nanoparticles for lithium-ion battery charging cycle, etc.). A new
"yolk-and-shell" nanoparticle could boost the capacity and power of lithium-ion batteries. The gray sphere at
center represents an aluminum nanoparticle, forming the "yolk." The outer light-blue layer represents a solid
shell of titanium dioxide, and the space in between the yolk and shell allows the yolk to expand and contract
without damaging the shell. In the background is an actual scanning electron microscope image of a collection
of these yolk-shell nanoparticles. Source: David L. Chandler, MIT, August, 2015

New forms of Machine intelligence (from Artificial Neural Networks (ANN) and Machine learning to
Machine intelligence, i.e., from Large datasets to New Data streams, Data Patterns and Knowledge etc.)
Key Trend # 10. The “Man/Woman Machine” New forms of
Intelligence
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Key Trend # 11. Blockchain technology
Approaches to governance that rely on cryptographic methods such as the blockchain (e.g., permissionless distributed databases,
e.g., bitcoin protocol, etc.) Blockchain technology protocol leads to “All in One” databases cryptographic methods

Source: Report from McKinsey referring to Economic Impact (although not being comprehensive and including potential direct impact of sized applications only) estimates Economic
Potential and Consumer Surplus (not GDP or market size revenue) by showing the potential of disruptive technologies, including the Internet of Things (IoT) (2013)
According to IDC The global network
connecting people, data and
machines are propagating a radical
digital business transformation that
has the potential of $10 to $15
trillion USD to global GDP in next two
decades.

The Fourth Industrial Revolution and the Innovator’s Dilemma: “Disruptive” technologies may
threaten established firms and will transform the Digital Ecosystem
Source: Clayton Christensen (1997), “ The Innovator’s Dilemma”. Clayton Christensen, Michael E. Raynor and Rory McDonald “What Is Disruptive Innovation?”, HBR (2015)
Digital Technology Disruption and Ecosystem Transformation

Source: Gartner (August 2017)
Gartner Hype Cycle for monitoring Emerging Technologies (2017)
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Technology Cycles and Challenges in Technology Monitoring
Source: Managing Technology and Innovation Chapter 17, Management, 11th edition, Bateman and Snell, Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
written consent of McGraw-Hill Education.

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Digital Ecosystems – Disruptive,
Sustained and Efficiency Innovation
Source: Mark Skilton, 2014 – Modified by Filipe Castro Soeiro (2018)
Pervasive
role of
technology
Rate of
Technology
adoption
Non-exclusiveness
effect of
Technology
Digital
Economy and
Consumer Surplus
New Scientific, Engineering and Economic Knowledge
Social Collaboration, Digital Alliances and Networks

Innovation systems
Digital Ecosystems

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The innovation peak in the Greater Bay Area at global scale

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GBA Smart Region will require
Smart Cities – What’s next?
 Smart Mobility: AI-enabled transportation management systems, Sensors, Smart
networks, controls and app services, ride sharing, driverless cars, interactive bus stops
transforming the way we travel (e.g., Tencent, Alibaba, JD, Baidu, Microsoft, Google,
Amazon, IBM, Apple etc.).
 Smart Living: Mobile access, Wi-Fi connectivity, Internet services and Digital payment,
Urban living, Smart buildings, Smart home solutions, Internet-of-Things, e-Health care,
Personal trackers motivating citizens to live healthier, Smart data access and
management, Integrated urban planning, Smart and sustainable energy solutions (Baidu,
Three Gorges, Baidu, Tencent, Alibaba, Huawei, Google, IBM, etc.).
 Smart Environment: Water management, Energy management, Waste Management,
Pollution Monitoring, Climate Action Plan 2025+, integration of processes and services to
impact on sustainability, All-around key stakeholders sustainability efforts, etc..

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Smart Cities - the new social and
economic order – What’s next?
 Smart People: University-Corporate partnerships, Digital, Blended and Campus-based
combined experience, Digital Entrepreneurial and Business Incubation, Executive
Education, Digital Business Transformation, STEM and Education Grants, Societal Project
Based Learning, etc..
 Smart Governance: Open Data for public and private sectors, Adoption of Public Services
through Technology, Elimination of bureacracy, smooth and more intelligent data and
information processing, one stop shop app stores with streamlined services, etc..
 Smart Economy: Strengthen the current economic pillars by leveraging I&T, promoting
Sharing Economy and develop new Economic pillars, Servitization, supported by Cloud
computing, Digital Marketing and AI, etc..

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Smart Region GBA - Contextual Analysis
 Historical Framework:
 The “Factory of the World” with the combined GDP of the 11 cities in the region of RMB 9.35
trillion (US$1.38 trillion) in 2016.
 Economic Engine:
 Regional Innovation System accounts for 12 % of China’s economy (2016), even though the
region only accounts for 5% of the country’s population.
 If the region were a country, it would be the 5th largest economy in Asia.
 Competitive Rivalry:
 PRD Hub has higher potential for Innovation and Cost Leadership.
 The region faces increasing competition from countries such as India and Vietnam for low-
cost manufacturing.

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Smart Region GBA – Contextual Analysis
 New Framework Agreement (2017):
 Between the National Development and Reform Commission (NDRC) and the governments of
Guangdong, Hong Kong and Macau to transform the PRD into the “Guangdong – Hong Kong - Macau
Greater Bay Area (GBA)” by further integrating Honk Kong, Macau and nine cities in Guangdong, so
that they become a “World Class City Cluster”.
 Regional Challenge:
 From “The Factory of the World” to a dynamic “Hub of Innovation and Services” with a GDP of US$4.62
trillion by 2030. This means that the PRD will overtake rival bay areas in Tokyo, New York, and San
Francisco to become the biggest in the world in terms of GDP.
 Leading role in China’s next stage of economic development (up- and downstream).

Smart Region
Innovation and
Internationalization
– Greater Bay Area
towards China,
Africa and Europe
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Smart Region GBA – Innovation and International Strategy

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Smart Region GBA| Integrated Infrastructure Development
1. Hong Kong-Zhuhai-
Macau Bridge, which
will likely open in 2018
and significantly
reduce travel time
from Hong Kong to
Zhuhai and Macau.
2. Express Rail Link,
which is due to open
in 2018 and will
connect Hong Kong
to Shenzhen and
Guangdong, and
subsequently to
China’s vast high-
speed rail network.
3. Shenzhen-
Zhongshan Corridor,
which is an eight-lane
highway that will
reduce travel time
between Shenzhen
and Zhongshan /
Jiangmen by
approximately 30
minutes, after its
completion in 2024

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 Smart Regional Economy: increasing the economy’s value adding
capabilities and boosting internationalization (next stage of economic
development);
 Smart Multifunctional Region: to become an important global center
for Advanced Manufacturing and to focus on Innovation, Finance,
Shipping, Trade and Leisure (complementary approach based on cities’
comparative advantages);
 Hong Kong to play the World Financial & Legal Center – Smart
Economy and Smart Governance;
 Shenzhen to play the China’s “Silicon Valley” because of its Innovation
and Startup culture – Smart Economy, Smart Living, Smart People and
Smart Mobility;
 Guangzhou to play the role as the Manufacturing Industry and
Logistics Hub – Smart Mobility and Transportation and Smart
Economy;
 Guangdong to play the strategic corridor to support innovation and
growth, firstly with GBA, and then to China;
 Macau and Zhuhai to reach higher value in Leisure and Tourism –
Smart Economy and Tourism, Smart Mobility and Living.
Smart Region GBA | Multifunctional Development
“Lok Mau Chau Loop
Technology Park”
“Booming
Innovation and
Startup
Ecosystem”
Legal and
Business
Environment
Leisure and
Tourism
Local and Global Value Chains
Manufacturing
Industry and
Logistics

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Smart Region GBA Full Integration
- Opportunities
 The Greater Bay Area – GBA’s connectivity will improve significantly with the number of
new railway stations, inter-city lines and bridges set to come on-line the next 3 years.
Guangzhou and the Guangdong corridor will have a key role here;
 Opportunity to build strategic partnerships with Chinese companies, both at local and
international markets, while making part of the winners of the new order at the very
beginning;
 Businesses will also be able to increase their competitiveness by relocating to new
development hotspots, such as Zhongshan, Zhaoqing, and Huizhou, where rents and
labor costs are lower than Shenzhen and Guangzhou;
 The GBA’s leading companies are to focus more on building significant international
businesses, while, simultaneously, the smart region will be the new and higher level
market in China;

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Smart Region GBA Full Integration - Opportunities
 Hong Kong as an international city with a highly developed professional services
industry and RMB convertibility, to assist Chinese companies to achieve these global
ambitions;
 Shenzhen to be the ultimate state-of-the-art in terms of innovation will lead the digital
business transformation, while influencing the formation of new ecosystems and
industries through digital convergence, disintermediation, disaggregation and digital social
networks;
 Global Value Chains (Huawei, Tencent, Alibaba, JD.com, Baidu, etc.) will produce
international impacts beyond the GBA, as the region is located on the maritime section
of China’s ambitious Belt & Road Initiative – Positive Externalities;

Innovation systems
Digital Ecosystems

Incubators Network – What’s the
New role in Digital Ecosystems?
(I) - Steady growth (Moore’s Law)
(II) - S-curved technology evolution
(III) - Cyclical technology growth
(IV) - Continuity/Discontinuity of technology

The intersection and convergence of technology types and industries

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Alibaba in the Digital Ecosystems

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 Alibaba ecosystem:
“Given the scale we have been able
to achieve, an ecosystem has
developed around our platforms
and businesses that consists of
consumers, merchants, brands,
other enterprises, third-party
service providers and strategic
alliance partners. At the nexus of
this ecosystem are our
technology platform, our
marketplace rules and the role we
play in connecting these
participants to make it possible for
them to discover, engage and
transact with each other and
manage their businesses anytime
and anywhere. Much of our effort,
time and energy is spent on
initiatives that are for the greater
good of the ecosystem and on
balancing the interests of its
participants. We feel a strong
responsibility for the continued
development of the ecosystem
and we take ownership in this
development. Accordingly, we refer
to this as "our ecosystem."

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Tencent in the Digital Ecosystems

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 Tencent controls hundreds of subsidiaries and associates in
numerous industries and areas, creating a broad portfolio of
ownerships and investment across a diverse range of
businesses including e-commerce, retail, video gaming,
softwares, virtual reality, ride-sharing, telecommunication,
banking, financial services, fintech, consumer technology,
computer technology, automobile, film production, movie
ticketing, music production, space technology, natural
resources, smartphones, big data, agriculture, medical
services, cloud computing, social media, IT, advertising,
streaming media, artificial intelligence, robotics, UAVs, food
delivery, courier services, e-book, internet services,
education and renewable energy. It is one of the most active
investment corporations in the world, with recent focus on start-
ups within Asia’s burgeoning tech scene.
 According to TENCENT ANNOUNCES 2017 THIRD
QUARTER RESULTS, QQ has over 8.43 million monthly
active users, and WeiXin/WeChat has over 9.8 million
monthly active users.

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Industry Mapping and Value Network
(Source: JOHNSON, Gerry; SCHOLES, Kevan and WHITTINGTON, Richard (2011), Exploring Strategy, Financial Times Press)
• Identify ‘higher order strategic
themes’ that is, how the organisation
meets the key success factors in the
market;
• Identify the clusters of activities that
underpin these themes and how they
fit together;
• Identifying ‘profit pools’ within the
value network and seek to exploit
these;
• Map this in terms of how activity
systems and processes are
interrelated.
• The Value Network comprises the set
of inter-organisational links and
relationships that are necessary to
create a product, service, process or
business platform;
• Understanding cost & price
structures across the value network –
analysing the best area to focus and
the best business model;
• The ‘make or buy’ decision: deciding
which activities to do ‘in-house’ and
which to outsource;
• Partnering and relationships –
deciding who to work with and the
nature of these relationships (social
capital).
Network Incubators – What’s the

Aggregators
Developers Publishers
Manufacturers
Stores
(B2B)
Integrators
OEMs
Middleware
Companies
Copyright
Owners
ISPs Consumers
(B2C)
Portals
(B2B)
Regulators Investors
Consultants
ICT Public
Organizations
Intermediate
Agents
Competitors
Network Incubators – What’s the

Incubating Digital Business
Transformation - Networks

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Computational
Thinking &
Design Thinking
Network
Platform
Business
Development
Product, Service,
Process &
Business Model
Prototyping
Market Testing &
Leads conversion
Network
Alliances
Market
Standards,
Certification &
IPR
Smart Capital
(VCs and Bas)
Policy-making &
Strategic
Advisement
Technology
Watch
Leadership
Open- System
Knowledge &
Social Capital
Key Resources &
Shared Services
Universities,
New Knowledge
& Applied
Research
Coaching
& Mentoring

Digital Platform Business Model
GungHo Incubation Network
System ?
(Discussion & Lessons Learned)

Thank you for listening! I look forward to
learning from you!
https://www.linkedin.com/in/filipecastrosoeiro
+351 962015247
filipe.castrosoeiro@usj.edu.mo

Foshan incubation network_greater_bay_area_prof_dr_filipe_castro_soeiro_april_2018

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