MIN Won-ki’s Digital Economy

Apple and Tesla

I look forward to a great company of innovation that changes the quality of human life 

more than a good company that succeeds in the market.

Looking back, some companies have radically changed the lives of humanity. Companies such as Ford that led the era of mass automobile production, GE that guided the development of the electric industry, American Bell that opened the period of telephone service, Bayer that produced aspirin, and IBM that led the development of the computer industry were innovative companies that dramatically improved the quality of human life and created new industries. These innovative companies have in common that they made a market that did not exist by creating entirely new products and business models and provided consumers with benefits and values that they could not have before.

Which company would you choose if you are asked to pick an innovative company of the time that can compete with these innovative companies? Not many companies are considered to have played an indispensable part in bringing about new changes, even among the companies that have been successful in the market. Innovation is mainly achieved by changing existing technologies and applying new business models. It may be wrong to say that one company led the latest creation. However, if we are asked to select an innovative contemporary company that ranks with the companies that changed human histories, such as Ford and GE, many people would probably choose Apple, which developed the smartphone that has brought about the biggest change in our lives since the advent of the automobile, and Tesla, which is leading the electric vehicle and energy charging technologies, the essential technologies to cope with climate change, which is the most serious pending issue for humanity.

What is needed alongside the principle and confidence of business managers is implementing a new business model through innovative thinking that pulls down the existing framework. When Apple launched the iPhone in 2007, Nokia had absolute power in the mobile phone market, and humongous companies such as Motorola, Samsung, and Ericsson dominated the market. Also, the new player, BlackBerry, was rapidly taking over the corporate mobile phone market. However, Apple was able to make a drastic change that transformed the existing communication-centered mobile phone into a ‘computer in hand,’ in other words, a smartphone, by expanding user convenience with the touch screen and opening the iOS-based App Store.

Tesla did not settle for replacing internal combustion engines using gasoline and diesel with electric vehicles running on batteries. It established a new automobile production and sales system that completely breaks away from the existing automobile manufacturing process, sales method, and service system by producing more than 80% of its parts through a vertical manufacturing process and system, introducing a new distribution system that sells cars directly to consumers, and introducing automatic software upgrades through wireless internet.

Among Korean companies of the future, I look forward to great companies of innovation, companies that change the quality of human life through the emergence of entrepreneurs dedicated to changing the lives of humanity with new products and new business models that completely change the existing market, rather than simply a good company that succeeds in the market.

President of State University of New York Korea MIN Won-ki