Why Malaysia has to be innovative?

Innovation is the development of new customer’s value through solutions that meet new needs, inarticulate needs, or old customer and market needs in value adding new ways. This is accomplished through more effective products, processes, services, technologies, or ideas that are readily available to markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself. Innovation differs from improvement in that innovation refers to the notion of doing something different rather than doing the same thing better.

Through innovation and exploitation of new ideas, additional value can be obtained using the human capital base and the same source. There are many forms of innovation, for example, improvements in products, processes and organizational structures. Innovation involves both the creation and diffusion of knowledge. The bulk of innovation in an economy comes from a myriad of companies, institutions and individuals to make improvements in products and processes or to identify new markets and opportunities.Hence, the Government will promote the innovation agenda of innovation activity across the economy. Innovation policy requires wide-ranging reform to ensure that Malaysia's business environment that is efficient, flexible and robust.

Innovations enable Malaysians to create wealth and improve living standards. According to the Prime Minister, the initiative is in line with the importance of innovation skills as an effective strategy to achieve success in a global environment that is termed as VUCA (very unstable, uncertain, complex and ambiguous). He said all the leading countries of the world have used innovation to achieve a great improvement in the development of their progress. An innovation-driven economy will enable the nation to further develop its science and technology sector and making it a force to be reckoned with globally.

Other than that, education is a major contributor social capital and economic development countries. Education is also a generator triggers creativity and innovation that equip young with the skills needed to compete in the job market, and become enablers of development the overall economy. Accordingly therefore, the government should ensure functioning of the national education system effectively to the success of the New Model Economy, the Economic Transformation Programme Government Transformation Programme and the basis of the country's economic development in global economic competition. 

This requires an education system that nurtures the creative talent and analytical. One important step is to develop a world-class educational institutions with world-class leadership also, especially universities. For this purpose, the government is committed to the global search for the best academic leadership to programs that support innovation, and also partner with leading global research institutions to ensure the transfer of knowledge deep and sustained. At the same time, education and training will be bonded with industry to facilitate mobility of teachers to undertake contract research and consultancy and industry practitioners to teach at the university. A program will be introduced to encourage industry participation to co-sponsor employees to obtain industrial PhDs.

Malaysia also can improve in term of Shaping a Supportive Innovation, The Government will support innovation by creating an environment that allows companies, research organizations and individuals tap into innovative activities better. These measures will include human resource development, infrastructure investment in innovation and foster new ventures through the incubator.The business environment is a critical ingredient of the innovation process, for example by ensuring a competitive environment with the right price signals will incentivize companies to innovate. Relaxation of the establishment and closure of the company will also support flexibility reallocation of resources to the highest growth areas in the economy. Investment in science, research and education can also serve as an engine of innovation in an economy. However, the innovation agenda has yet to reach the desired level of progress. 

For example, the decline in the organization's ability to generate knowledge evidenced by the decrease in the number of researchers from 21.3 per 10,000 labor force in 2004 to 20.3 in 2008. Gross expenditure on R & D (GERD) of GDP declined from 0.69% in 2004 to 0.21% in 2008, compared to about 3% for Singapore. Malaysia aims to increase GERD to 1% of GDP in 2015. The government will take actions to strengthen Malaysia's innovation system through four main dimensions such as create an environment that supports innovation, Create opportunities for innovation, Provide enabling innovation and finance innovation.

Government, international examples to encourage entrepreneurial activity as the French government has introduced "Auto-entrepreneur" in 2009 as a way to encourage more start-ups and entrepreneurial activity. The scheme includes measures to improve cash flow in the new company by allowing the cost of distributing social security charges and income tax; simplify and reduce the cost of business registration, and provide greater protection for personal assets from bankruptcy. The scheme has exceeded expectations, with about 320,000 business registration. In 2009, the registration of a new company in France increased by 75%.

Furthermore, innovation also important to marketing because marketing plays a key role in translating customer information on the new products and then put these products on the market. New products and services is a way of responding to changes in customer preferences and competitive dynamics. Marketing is responsible for identifying customer needs, marketing should be to improve and take a leadership role in the innovation process.

Better future through innovation economic growth to drive Malaysia's transition to a high income economy requires the development and application of new technologies. This should be supported by efforts to develop and acquire innovative products and processes, as well as create and adopt effective management. The shift to higher value chains requires the process of change, innovation and increased productivity. 6 Strategic Reform Initiatives (IPS6) in MBE stressed the importance of awareness by decision makers in the public and private sectors about the need for investment in innovation as a catalyst for growth and competitiveness.

Malaysia can no longer rely on multinational corporations (MNCs) in order to drive innovation and to help Malaysia to integrate into the global network of production processes and markets. As discussed above, this integration depends on strengthening the entrepreneurial ecosystem in Malaysia as well as efforts to improve the environment for innovation. Entrepreneurship and innovation will not emerge on its own, although it is more likely to materialize in a competitive free market. While innovation can generate reward, it also comes with risks. Failure should not be punished to entrepreneurship is stifled. In addition, various funding should be made available. Government, in collaboration with all parties involved, play a major role in creating an environment and ecosystem that can foster innovation.

References:
- http://www.theedgemalaysia.com/technology/158818-malaysia-as-an-innovative-nation.html
-http://founder.limkokwing.net/blog/editor/malaysia_must_be_more_innovative_says_minister/