BAKU, Azerbaijan, December 11. Azerbaijan has taken a leadership role in thinking through how to make an energy transition, which is a clear megatrend nowadays, Michael Ringel, Managing Director and Senior Partner at Boston Consulting Group (BCG) said in an exclusive interview with Trend.
“Of course, there are some huge innovation megatrends happening right now, which include digital development and AI, covering how this ability of machine learning does not replace, but supplement human thinking. Energy transition and what we do about climate, including the COP 28 convention on climate change, is a clear megatrend as well. Azerbaijan is in a fantastic place to capitalize on this megatrend, as energy transition is something that the country is extremely well positioned for, taking into account its major presence at the COP 28. There is a delicate balance between the world’s obvious need for energy today and the need to supply and support energy transition in a responsible way. Azerbaijan has taken a leadership role in thinking through how to make that transition,” he said.
Azerbaijan’s role in bridging different parts of the world
Ringel highlighted Azerbaijan’s unique ability to connecting very different parts of the world, as the country has great connections both to the West and the East.
“This ability to play a role that fits within all these distant sectors and different geographies is a real strength that Azerbaijani people probably don't notice while they're here. Nevertheless, those of us on the outside looking in notice how beneficial it is, as the crossroads of history have often been the places where the most vibrant innovations have occurred. Azerbaijan is blessed with a huge diversity of industries like energy, high-tech, mining, agriculture, tourism, and financial services, so the ability to start from that strength of breadth of opportunities means that sky is the only limit for Azerbaijan's industrial development. Moreover, there is a whole range of potential new opportunities within each sector, but also at the intersection between those sectors,” he noted.
Evolving of innovation landscape in recent years
“There have been massive changes in innovation in recent years. At the conceptual level, what we're seeing is an incredible change in pace at which innovation is evolving. And then, of course, there's a huge change in the way innovation happens, with an incredible change in the democratization of innovation. So it really can happen anywhere in the world now, which is a huge benefit to humanity,” Ringel noted.
He underscored that every year the pace at which new advancements emerge for the collective benefit accelerates, and broadens geographically, which is actually valuable as ideas can come from every part of the globe.
“We don't just have a hegemony of single kind of ideas, we have both this pace where things are coming out much more quickly than before, but also the geographical breadth of where ideas can come from. This growing pattern leads to a lot of diversity of ideas as we don't have a single way of thinking anymore, which, I think, is really valuable,” he explained.
Role of investments in innovation development
He said that there's no innovation without investment, whether that's investment of time or financial investment.
“There always has to be some work put in order to get some output. I'm reminded of the quote by Thomas Edison, which states that innovation is 1 percent inspiration and 99 percent perspiration. Innovation demands an investment of time. It's a continual effort, a constant perspiration requiring dedicated work. So, whether it's in terms of time or money, that effort represents an essential investment,” Ringel said.
Emerging sectors requiring innovation and investment to tackle modern challenges
Ringel stressed that there is no sector today where innovation doesn't matter, although there are currently some areas that are hot for innovation right now.
“We can pick biotech or pharmaceuticals, where we've had a set of new technologies come to the fore, like RNA vaccines that open up a landscape of new areas to get into. There's a ton of work to do there and think about where these vaccines develop next, what are other technologies that can change human health. That's one kind of industry where there's been a recent explosion. There are other industries that are maybe more stable right now, but it would be a mistake to say that innovation there doesn't matter. It's actually those industries sometimes where the new idea sparks a real shift and a complete change in how that industry operates. So no matter the industry, innovation needs to be there as a driver of value, whether the demand is high or not. Whether you're in a hot sector or a less dynamic one, there's always an opportunity to infuse innovation and turn the cold sector hot,” he said.
Navigating the rapid pace of innovation
Ringel noted that the acceleration in pace and the expanding diversity of sources for innovation, as discussed earlier, is truly remarkable.
“The pace and the breadth of innovation mean that there's just this rush of potential ideas that come at management, but finding the right idea in all that rush becomes a needle in a haystack. You might get distracted by one idea, and go down the wrong path. That's where strategy becomes incredibly important. One has to have a clear view on the mission for his or her company and what it is trying to achieve in terms of where does one want to operate. That becomes the guide in sifting through the rush of ideas to pick the right one. Strategy is as much about choices of what not to do as it is what to do,” he said.
Further speaking, Ringel noted that the described strategy gives one a real lens to choose between all these things to choose from that come with this dizzying speed and array of breadth of opportunities and say, well, these are the things that fit what I should be going after.
“So that's the challenge, this rush of ideas, the breadth of ideas, the pace that they come at. The key lies in having a strategy that is the lens to help understand the ideas that one is going after and the ability to identify the goal that is right for one to pursue,” he explained.
