Dato Timothy Ong is a leading Brunei businessman and the Chairman of Asia Inc Forum, he is also an acclaimed facilitator of business and public policy dialogue in ASEAN and beyond. He served as the Acting Chairman of the Brunei Economic Development Board (BEDB), Brunei’s leading economic agency from 2005 to 2010
Why is innovation important to businesses?
First, let me share a bit about my personal background with you. My family used to be number one in the movie business in Brunei. At that time the model was the bigger the cinema the better, so our family cinema had one thousand seats. We are no longer in the cinema business. However, if we’d stuck to that model of having one thousand seats we would have gone out of business because today, the model is different, it focuses on small, very comfortable cineplexes.
The point is, if we’d wanted to stay in the cinema business we would have had to innovate and adapt, this is so critical to any business. Recently, there have been two examples of business innovation here in Brunei. Firstly, Times Square is a very successful new development. The developer has an interesting approach – he not only builds but also brings in the franchises, like Pastamania and All Seasons (his own brand). This shows that he’s not thinking just about the building, but also about how to fill it.
Mabohai Shopping Complex is another example of innovation. It was barren for a long time but it’s now been upgraded and is now a nice, small, family mall. The niche is different, there are no cinemas so therefore there are not many teenagers, and it’s more for families. Your own BHC magazine is yet another example. This magazine touches on something that Bruneians are very interested in, that is, homes and furnishings.
We have to keep thinking that there must be a better way of doing things. The day that we start thinking that we know everything, is the day that there will be no more innovation.
Franchises are big business worldwide. Are they threatening to take over and phase out the smaller retail shops in Brunei?
The market in Brunei is small, so this limits the amount of interest that franchises would have here. The franchises are definitely making a major impact on the bigger markets. But having said this, even for a country like Brunei, franchises are not necessarily bad news for small business.
For some small businesses getting a franchise may sometimes be the best way into business. Of course, you can always create your own brand like, Country Patch and All Seasons, these are locally developed brands and then you have franchises like Pizza Hut, McDonalds, Burger King and KFC.
As a small business person you need to decide which path to take, you can either be part of an established franchise or develop your own brand. In a small market like this franchises can be very expensive- the key is to make sure that the terms are right so that you can make money from the franchise. But we have to accept that franchises are now part of the world we live in.
Sometimes it may be better to take a franchise than to try to develop one yourself. For example, the Radisson Hotel is part of a franchise which means that there are more fees to be paid for the name, management and expertise, but in the long term this can be more profitable because of access to knowledge and expertise. In the case of The Brunei Hotel, this is smaller hotel and easier to self manage with lower costs.
What advice would you give to entrepreneurs?
Firstly, you must have a willingness to learn. Talk to people – don’t think that you have all of the answers. You must also be willing to fail. Some people think that failure is a terrible thing, they don’t want to risk it – those people should get a job in the corporate world, as the world not only needs entrepreneurs but also lots of different people with different skills and abilities.
At the end of the day, no matter how good you are the world is changing rapidly, something new is always around the corner that could put you out of business. My belief is that innovation and creativity are central to business success.