Macau | Smart city requires leadership transformation - expert

Speaking to MNA about the latest trends in smart city development, Filipe Castro Soeiro, visiting professor at the University of Saint Joseph, argued the Macau SAR position in the Greater Bay Area is an asset for the transformation of company and government cultures in the digital era

Macau (MNA) – Creating synergies between government, companies and universities is key in the race to integrate gradually more complex digital ecosystems. Speaking to Macau News Agency (MNA) about the latest trends in smart city development, Filipe Castro Soeiro, visiting professor at the University of Saint Joseph, argued the Macau SAR position in the Greater Bay Area is an asset for the transformation of company and government cultures in the digital era. To the specialist, who gave a talk in an event organised by the France Macau Chamber of Commerce (FMCC) on Wednesday, it is high time to foster a new managerial mentality.

MNA. What types of investment and organisation are required for the development and implementation of Smart City policies and projects?

Filipe Castro Soeiro. It requires careful and detailed analysis and it also depends up on the priorities of the different initiatives and the time spent to implement projects in Macau. I perceive a great opportunity for the implementation of several projects, and I think we have to come with approaches that are not focused on one player only, but on a network of players.

By bringing together companies like Alibaba, Baidu, Tencent, I think it is a big challenge not only for companies to create new added value for citizens, but also [regarding] the transformation of industries and these companies. These companies, if working together, can learn from each other, set themselves in integrative networks and create new knowledge in very strategic development products and provide new products and services.

With regard to the learning process you mention, whose role is it to pass on and transfer knowledge?

F.C.S. I think we are going to have different sources of knowledge. We’ll probably have some more linked to technical and regulatory knowledge, thus close to governance, rules, procedures, and so on, which is going to be more centralised. And you will also be required to have a great level of technical engineering and economic innovation – new knowledge, basically – and this is going to be spread between companies, large companies, small and medium businesses, startups, innovators, incubators, and somehow universities, which I think can lead the transformation role as a lighter actor but really useful within the knowledge spillover needs.

On the one hand, universities have scientific knowledge and, on the other hand, by working with companies and groups of people, innovators, entrepreneurs, investors, together they will transfer this scientific knowledge into economic knowledge […]. So I think universities can be a great instrument alongside companies. But within the companies, it is important to make sure they are working within networks, so that you can actually have multiple levels of transformation at the same time with one initiative.

What kinds of expertise are crucial to implementing Smart City-related policies?

F.C.S. I think some of them are related to the social challenges that go with leadership transformation, first of all, and that involves changes in the board of directors and senior managers of companies already installed in Macau and in the Greater Bay Area, to really start the transformation by setting up open systems in their companies, perceiving how they can operate, compete, and develop, capture and deliver value. The first role for companies is to understand that they have to re-invent, redesign themselves from the leadership and from the strategic standpoint because this transformation process also positively affects the major strategic plans of these companies.

The second [role] focuses on different disruptive technologies to really execute these innovations – to test, prototype, and validate them. And here I think it is an intersection of technology in multiple fields, such as Big Data, the Internet of Things, mobile computing or machine learning. The other area is social business management, which entails the knowledge of integrating these technologies. I guess, for Macau, we would be talking about software developers, digital marketers, content creators, and media producers, as well as sophisticated analytical engineers.

On the other hand, and equally important, there would be business management innovators, business designers and entrepreneurs. It is no longer possible to manage business as usual anymore. You have to have a new mentality of managers, pretty much focused on innovation and entrepreneurship.

How do you perceive the interplay between local and foreign knowledge and expertise?

F.C.S. We need to create conditions to attract new talent and to nurture, build and manage this talent. At the same time, we do have to design the region in a more open way. With different initiatives we will attract new talent, providing at the same time opportunities to incubate new processes and new forms of setting businesses around, I would say, for starting digital technologies that are linked or close to hospitality management and tourism. The intersection between digital and physical assets within business models and value proposition would play a huge role in Macau.

From the incubation standpoint, I think Macau can create a cluster focused on that area, building conditions to create new, local talent that can learn and interact, and also innovate with these external talents – in fact, to generate new core competences ahead. And last but not least, I think universities have a strong responsibility and a huge role in providing and supporting new capabilities for companies by designing training programmes, very innovative and hands-on, that are really robust from an instructional design standpoint and highly innovative curriculum with sophisticated teaching and learning methodologies and with the ability of these learning objects and outcomes to be applicable to companies.

You have to involve project-based learning, process-based learning around these programmes. In fact, it is the only way that companies have to really make an investment with a high-return rate.

What are the most common mistakes that governments make when implementing Smart City-related policies nowadays?

F.C.S. I guess that the trend historically shows that they prefer to go smoothly and by incremental approaches as they are typically focused on smaller pieces within the ecosystem. In the case of China, I think we have a strong breakthrough opportunity and the Greater Bay Area has a huge role for China in the next development stage, economically and socially speaking as well. The major risk is the orchestration.

You need to have a governmental system and institutional systems that help set, implement and manage the orchestration of multiple technologies, innovation processes, actors and regions. So, if government policies are able to design a good orchestration system composed by government leaders, multiple institutions and universities, as well as company leaders, I think this would work best […] opening up the viability of decreasing risks and to increment as much as possible the potential.

And there is a huge benefit for the Pearl River Delta as well, which is the opportunity that one region can learn from another at the same time, stage by stage. Typically, you don’t have this when you are accessing or studying places such as London, New York or Silicon Valley. I do have a strong positive feeling about this transformation.

What do you think would be a good compromise between allowing people and customers’ freedom to navigate the digital world in its several forms and the protection of personal data?

F.C.S. I think we are living in times, globally, in which we are somehow balancing different forces. On the one hand, we have businesses, consumers, and influencers, and individuals – citizens in general, all of them – which are pretty much dependent upon digital interactions by using different systems, sub-systems and equipment. Included in this trend, businesses are setting their profits and their values are positioned around such systems, social media, sharing, all the manifestations that can make part of an experience around a product or a service within a community.

When customers and businesses engage in commercial relationships, you are generating value, not only from a functional standpoint but from an economic standpoint, also fulfilling a social and psychological value dimension, which is part of belonging to a digital community.

On the other hand, we do have these requirements and standards in what regards data protection and cybersecurity. This is not only to control, in the sense of control versus freedom. The balance that is required here is, in fact, between the protection of businesses and citizens […]. I’m personally convinced that what governments are focused on and directing their priority to is the reinforcement or control of data protection, protecting consumer rights, different stakeholders, for adding more transparency to the system. We are incrementing flows. Financial flows, personal and professional data flows, which require a new way of management, as well as regulation and more sophisticated systems.