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TDG Insights

Build Trust Through Sustainability

By | TDG Insights

People, planet, and profit.

Every brand should have a thorough understanding of how their business activities, culture, and products affect people’s lives, the environment, and the organization itself. Chinese companies planning to go public on international stock exchanges require environment, social, and governance (ESG) compliance in addition to a healthy profit-and-loss (P&L) sheet. Brands should conduct a materiality analysis to identify aspects that are most critical to the business.

Be transparent

Consumers generally trust people they know more than strangers, so Chinese brands can’t afford to be a stranger to their consumers. When you are new to a market, your target customers naturally would like to know you better. Firms need to make it easy for them to find out information about the company, the management team, available products, and the company’s mission. Transparency assures consumers that a brand acts as a good citizen and will be held accountable for any unethical practices.

Engage your stakeholders

Suppliers, employees, local communities, and NGOs are also important stakeholders that brands should engage in the sustainability management discussion. Chinese firms should work with their suppliers to improve supply chain robustness and address potential labor issues. Companies can also involve employees in the process of creating a better corporate culture, and encourage their participation in local community development projects.

Our 2016 annual consumer survey indicates that overall American consumers gave Chinese brands a passing score on quality of product. Some also noticed Chinese brands’ effort to become more innovative and creative.

At the same time, however, the results of the survey reveal that there are a series of urgent issues that need to be addressed. More than half (57%) of American consumers in our survey did not think Chinese brands are doing enough to ensure transparency. Their comments highlight issues related to information disclosure, intellectual property rights, and general honesty. More than half of American consumers in our survey were concerned about sustainability issues such as pollution, labor, and safety. Also, more than half of the American consumers surveyed believe that Chinese brands lack genuine customer engagement and have done a “poor” or “very poor” job building an emotional connection.

While being emotionally reserved and humble is a prominent characteristic in Chinese culture, it may become a hurdle for Chinese brands to express their enthusiasm and personalities.

It is therefore essential for Chinese firms to create content that helps tell their own stories, and get their voices heard through both earned and paid media. While the effects may not be immediate, effective content strategy and brand media will help Chinese brands establish credibility and authenticity, shift the tone of mainstream media, and influence public opinion over time.

Innovation Redefined

By | TDG Insights

Innovation takes place in many different forms across functional units, value chain stages, and no longer holds sway as the sole driver of innovation. More tools and approaches such as open innovation, crowdsourcing, and cross-sector partnerships are become available to fuel innovation, accelerating companies’ return on investment. Companies can benefit from adapting these new mechanisms to streamline the sources, strategies, and process of igniting innovation.

The limits of R&D spend

In this research, we investigated companies’ innovation performance based on various parameters. Our findings suggest that innovation is not linearly depended on the amount of R&D spending. Although investment in R&D can allow a company to maintain innovations progress, simply increasing spend is not sufficient to fully capture and capitalize on all innovations opportunities.

Forbes ranks large global companies’ innovation capability based on the ratio of investors’ projection of their future growth over their current valuation, a metric termed an “Innovation Premium”. Among the 10 U.S. firms exhibiting the highest Innovation Premium, companies viewed as more promising by investors do not always spend more on R&D than their peers, even after taking industry differences into account.

Similar trend was also found when it comes to brand perception based on past performance. Among the top 10 companies that are ranked highest for their innovation reputation by Strategy&, for instance, Apple Inc. is the best recognized innovative brand but spent much less percentage of their net sales on R&D than Microsoft in 2014, who only hits the 8th place.

Consolidate your innovation strategy

If tossing more money onto R&D is not the only viable innovation strategy, what are other options on the table? In the Innovator mapping tool, we outlined four different types of innovation strategies based on the level of integration as well as the focus of a strategy. A company’s innovation activities could be driven by largely traditional internal R&D taskforce, or by incorporating collaboration across the board including open innovation, crowdsourcing, consumer insights, and cross sector partnerships. At the same time, a company’s innovation strategy could focus on aggressively seeking new business models, or on the other hand the continuous optimization and improvement of current operations.

Disruptive

By engaging talents across functional teams and stakeholders, channeling underutilized resources, and discovering new opportunities, disruptive innovators oftentimes define new market trends with groundbreaking products and services. For instance, Apple’s iPhone was a result of innovation not just from its stellar product design team (both hardware & software), but also new strategies in marketing, supply chain, and many other functional units. Disruptive innovators, however, could lose their competitive advantage when the innovative business model is replicated and improved by competitors. Apple once redefined the concept of cell phone, but now faces fierce competition with a number of Android phone manufacturers. Disruptive innovators who are much ahead of their time are likely to face regulatory risks and resistance from traditional players. A case in point is the struggle of the new sharing economy platforms such as Uber and Airbnb have with regulation restrictions in many regions and protests from businesses whose market shares are affected. It is critical for these first movers to be able to both sustain its core competency and mitigate social and governance risks.

Agile

Being an agile innovator means continuously optimizing products, services, and processes based on existing business models, which requires critical thinking and goes beyond the old-fashioned “continuous improvement”. A company might not produce disruptive innovation every day. But it can certainly be an all-time agile innovator. This strategy sets more tangible and achievable goals, maximizes the value of existing assets, and makes timely adjustment to external environment possible. Agile innovators face less risk of failure, but they also put ceilings on the potential of business transformation. After the introduction of the first generation of iPhone and iPad, Apple has been continuously rolling out newer versions of these products every year.

Discrete

Due to industry specifics and longer development cycle for particular types of products, many innovators, pharmaceutical companies and hardware manufacturers for instance, are still largely relying on R&D. Discrete innovation strategy allows companies to dedicate themselves to developing new products with its own proprietary knowledge and technology. However, this strategy may not be suitable in many business situations. It is less flexible in terms of decision making and the inward focus may slow down the response and adjustment to external changes. Therefore, a successful discrete innovator requires that the business leaders are fully aware of the mega trends and making the right the business decisions. Until 2013, Nokia spent more money on R&D than Apple every year. However its poor decisions on both high-end and low-end market segments could not turn the investment into profitable business.

Incremental

Incremental innovators, on the opposite direction to disruptive innovators, have minimal integration of innovation effort and short-term objectives. This is the least-desired innovation situation yet common situation to many companies that are struggling with innovation. Incremental innovation does not have a systemized approach for collaboration. The R&D effort is mainly focused is on existing business models which makes it difficult to make adjustment to disruptive changes in the market competition. Incremental innovation might be sustaining for a while, but not sufficient when there is a shift in competitive landscape. Strangled by the focus on its long successful and profitable film business, Kodak did not react timely to the new market trend with new products or services and lost its competitive advantage in the era of digital technology.

 

China Outbound

By | Practice Areas

As the world’s second largest economy, China is now home to an increasing number of global enterprises and brands. Founded by experienced professionals with intimate knowledge of both Chinese culture and international markets, TDG strives to become a strategic partner to our clients during their journeys abroad. Committed to a collaborative approach to providing services, we leverage our best talent and resources for each client, and aim to build long-term relationships.

CHINA’S OUTBOUND INVESTMENT

TDG’s China Outbound team helps Chinese businesses and organizations enhance reputation and build brand equity in overseas markets. Specifically, we focus on ensuring the quality of details, and developing meaningful partnerships with local stakeholders and community leaders. We are privileged to have provided services to both large multinational corporations and emerging businesses. Among them are:

China Telecom Americas  |  Center for China and Globalization  |  ZTE Corporation  |  BlueFocus International  |  RugGear

Our capabilities include:

  • Media relations
  • Public advocacy
  • Brand strategy
  • Crisis management
  • Communications leadership training
  • Corporate social responsibility
  • Advertising
  • Social media marketing
  • Web and creative design
  • Digital analytics
  • Content marketing
  • Event management

Sustainability

By | Practice Areas

The growing expectation among consumers and employees alike for businesses to “do good” has redefined corporate social responsibility (CSR) in a transformative way. At TDG, we help our partners create and materialize sustainable brands by engaging both internal and external stakeholders in a sincere and transparent manner. We create CSR initiatives that drive impactful social changes and deliver long-term business values.

One of the first steps our CSR professionals take when engaging clients is to help company executives understand how the business activities of their organizations interact with people’s lives, the environment, and their own employees. Through value chain mapping and materiality analysis, we help brands discover and adopt business strategies that contributes to their triple bottom lines – people, planet, and profits. Our team has provided services to:

SunTrust Bank  |  Lenovo  |  ZTE Ghana  |  Kautex Textron | Counter Culture Coffee | Southern Company

Our capabilities include:

  • Materiality analysis
  • Sustainability messaging
  • CSR reporting
  • Purpose marketing
  • Public advocacy
  • Media relations
  • Social media
  • Employee engagement

Africa

By | Practice Areas

Africa has seen rapid economic development in recent years. Sectors such as construction, telecommunications, banking, and retailing are booming throughout the Continent. A growing middle class in countries such as Kenya, Nigeria, Ghana and Angola is also propelling the African economy, resulting in a vibrant entrepreneurship community and an increasing number of businesses that are looking beyond the African continent.

TDG’s Africa Practice team is an internationally trained group of experts in law, public policy, and communications. With extensive understanding of Africa’s energy, agriculture, trade, policy, and telecommunications sectors, we help clients from the United States and China develop business opportunities in African countries, meanwhile helping African businesses and public entities understand international markets and build meaningful partnerships abroad.

Our capabilities include:

  • Government relations
  • International business development
  • Capacity building and training seminars
  • Community engagement
  • Media and public relations
  • Crisis management
  • Corporate social responsibility
  • Event management

Technology

By | Practice Areas

Technology companies are at the forefront of business and social innovation. At TDG, we understand tech companies’ need for building brands and reputation – fast, and as creatively as their own products and services. We help tech companies in communicating their stories and visions effectively, and differentiating within their industries – media, telecommunications, education, and more.

We ask every member of TDG to embrace an entrepreneurial mindset – and require them to not only understand, but also develop insights on the latest trends in technological innovation. Our team has extensive experience in digital and social media advertising, crowdfunding technologies, content marketing, and e-commerce. We also work closely with technology blogs and media outlets, and keep a pulse on all major innovation hubs around the world – from Silicon Valley to New York, and from China to Kenya. Our clients include:

ZTE Technologies  |  China Telecom Americas  |  RugGear  |  KSCat  |  Roboterra

Our capabilities include:

  • Branding and communications strategy
  • Crowdfunding campaign design and implementation
  • Visual identity design
  • E-commerce platform design and development
  • Social media and search advertising
  • Content marketing
  • Media and influencers relations
  • Video production and interactive design