The 8 Modules, 31 Focus Points and 5 Collaboration Phases of the SEIC Methodology provide a path to success

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Our Diagnostic Tool provides a gap analysis of SEI capability to support the strategic planning process

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In-depth explorations of the approaches and techniques used by leading organizations in the field of SEI today

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Thought leadership and insightful articles on the most important issues for companies pursuing an SEI agenda

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Insight calls are available to join for all members of the SEIC and will be addressing a number of topics

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The 11 modules of the SEI methodology focus on the key processes that enable the successful rollout of SEI

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Our Capabilities Assessment tools provide the means for organizations to gain insight into their own SEI approach

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In-depth explorations of the approaches and techniques used by leading organizations in the field of SEI today

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Thought leadership and insightful articles on the most important issues for companies pursuing an SEI agenda

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Useful downloads, from unique research to practical templates, frameworks and tools being used by SEI leaders

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How can SEI programs benefit from China's AI boom?

China is determined to become a world leader in AI. To tap into its innovations, buying organizations must build mutually beneficial collaborations with Chinese industry and government

China AI

 

Organizations pursuing Supplier-Enabled Innovation are aware of how agile they must be. In an environment where being at the cutting edge of innovation defines success, standing still and not exploring different markets can be fatal for an SEI program.

 

These were the views shared during the Supplier-Enabled Innovation Center’s Accelerator at Husqvarna last week. The group of companies assembled at the Swedish manufacturer’s offices agreed that keeping an eye on the latest technology solutions – wherever in the world they appear – and quickly introducing them to their organizations is key to SEI’s success.

 

Artificial intelligence is one such technology these companies are closely monitoring; and increasingly, China is emerging as the market they must keep a close watch over.

 

In July, the Chinese government released ambitious plans for developing the country’s AI capabilities, with a target of building a $150bn industry by 2030.

 

Unlike other technologies that China has designated as key focus areas and failed to make significant progress in – semiconductors serving as a principal example – the country has the right mix of ingredients to become an AI hub. AI technology requires data, and China’s increasingly tech-savvy 1.4bn population produces a mine of information to feed into the industry. The country’s laxer online privacy laws also make it easier for AI companies to access this data, and the government is placing its considerable financial might behind the industry.

 

These developments must be tracked by buying organizations with an eye on AI’s evolution. In addition to the group at Husqvarna, recent research from the SEIC shows that organizations scouting cross-regionally for innovation both stay on top of the latest emerging technology trends, and see these technologies positively impact revenue and pipeline. Overlooking the AI expertise that will increasingly appear in the Chinese market would create a massive innovation blind spot for these companies.

 

But China’s AI sector is not one that can be easily accessed. While the country’s AI plan encourages foreign involvement, traffic appears to be one-way: Chinese companies looking abroad to acquire AI technology as part of the country’s “going out” policy (走出去战略), and foreign AI enterprises establishing R&D centers in China – both in the name of China strengthening its domestic AI capabilities. Moreover, because of the closeness between China’s private and public sectors and AI’s designation as an industry of national strategic importance, domestic players are typically wary of sharing intellectual capital with foreign firms.

 

There is only one way for companies to overcome these challenges: mutually beneficial cooperation and collaboration.

 

As with other emerging technologies, Chinese industry and government have shown a willingness to share AI resources where mutual gain exists. Google serves as an example: despite its search engine being banned in the country, the company is established in Beijing and has brought value to China’s AI development – most recently by collaborating with local government on an AI summit. Today, the multinational tech giant is hiring Chinese AI experts unopposed.

 

Other organizations should follow suit, and while establishing on the ground operations in China and building a credit of goodwill with local government isn’t an option all companies can pursue, there are other mutually beneficial forms of cooperation that can be explored.

 

Technology licensing, cost sharing for joint projects, strategic collaborations – these are the kinds of incentives that we have explored in the SEIC, and can be offered to create opportunities for both buying organizations and their Chinese counterparts. All require a certain level of maturity to roll out, with stakeholder engagement and company alignment essential – but the potential returns on cultivating these relationships are huge.

 

It is too early to say how successful China will be in its aim to become the world’s premier AI hub. Questions around how the country will capture value from its myriad AI start-ups will need to be answered, and ethical concerns over how AI will be leveraged by the Chinese state could raise international alarm bells.

 

What is certain, however, is that the country is set to make vast progress. For organizations that see AI as a strategic technology area, forging a path to China’s AI capabilities should be a priority.

 

Samuel Wrest

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