Stanford University-School Of Engineering | Richard Dasher

Stanford University-School Of Engineering | Richard Dasher

 

Alan
Welcome back. I’m here today with Richard Dasher. He’s a PhD from Stanford University where he serves the roles of director of the US Asia Technology Management Center. And he’s also the executive director at the Center for Integrated Systems and consulting. Welcome to the show.

Richard
Thank you very much, Alan.

Alan
So Richard can give me some of your background. This is quite a mouthful going through the two, two centers over there. But how did you let’s start back? How did you come to be at Stanford?

Richard
Well, actually, it’s an interesting story that I can’t claim was planned. My undergraduate degree is from the music conservatory. When I was growing up, I wanted to take a big challenge that nobody knew whether I could do, I grew up in South Georgia, went to the San Francisco Conservatory of Music, where I got my undergraduate degree, decided that I wanted to do something a little bit more cerebral, and went to graduate school at Stanford in linguistics, where I specialized in the Japanese language. And then I decided I didn’t want to be a college professor. After finishing a PhD, I went to the US State Department and was in charge of the Japan and Korea training programs for American diplomats. So I spent a year doing the basic programs in Washington. And then I directed to field schools in Japan and Korea, for American diplomats who would be assigned to those countries. After that, I decided I better get some business experience. So I stayed in Japan and worked for two companies as a board director and developed international business. And then I heard about this technology management center that was being created in the School of Engineering at Stanford. And it sounded like a really intriguing kind of proposal to help train American scientific and technical people in the skills that they would need to be successful in Japan, and in East Asia, and really on a global economy. So I went into the US, the Stanford University School of Engineering, in 1993, as the Associate Director of this technology management center, and the next year became the director of it. And we have focused a lot on Japan. But now we’re looking broadly across Asia. I’ve also been working with CIS, which is really exploratory research into nanotechnology and other kinds of advanced electronics. So I divide my time in half, and keeps me busy.

Alan
Now I understand you speak regularly entrepreneurship in the US in Asian markets? What are some of the recent trends that you see for the growth in these areas?

Richard
Well, entrepreneurship is a hot button, and just about every economy in the world, people are seeing how entrepreneurship contributes to innovation, which contributes to continuing economic growth and also competitiveness. If you can standardize something, it will go to a cheaper place. However, innovation really does not standardize. It has to do with the combination of human creativity, and risk taking. And entrepreneurship is at the heart of taking a particular kind of risk, doing something that might transform an existing industry or change an existing kind of company practice. And so it’s an topic of interest all over the place. Now, what’s happening is you have quite high entrepreneurship rates. In some countries, the entrepreneurship rate of people involved in entrepreneurial activities is double the United States, right in China. So China has a route the share of about 24% of the population being involved in some kind of early stage entrepreneurship. In the US, it was 12%.

Alan
You know, this is interesting, because I once heard somebody make the comment, and as you said earlier, if you standardize something a can go someplace else. And they said, one of the things that keeps the United States ahead of the rest of the world is their ability to innovate. And you just made a comment about all these early startups now, in China that innovation is seems to be shifting over to other places.

Richard
Well, every place needs to innovate. Now, the difference between China is that they are still transitioning from kind of a less developed country into an advanced economy. Some places the wage costs are already getting pretty high. And the East Coast cities in China are getting to act a lot like advanced economies. But China has a huge set of opportunities in terms of developing tier two cities and and even further into the interior, so that the real opportunities in China are based on getting to the market first. Whereas the opportunities here really have to do with coming up with something much more creative, something much more different.

Alan
So we’re still are on top with the creativity and the innovation.

Richard
I think you won’t find a place quite like Silicon Valley anywhere else.

Alan
Well, so when you look at the hot buttons right now, for businesses here, coming to Stanford, where do you see trends moving towards?

Richard
Right now, cloud computing is really a hot area. I think that energy and clean tech is probably the next wave after that. Medical areas. biomed as the population continues to age, going to be a long term growth play. But right now it’s cloud computing.

Alan
Visiting here today with Richard Dasher, he’s the director of USAsia technology management and also the director of incentive integration systems Consulting at Stanford University, we needed to take a quick break. We’ll be right back after these messages.

Alan
Welcome back. I’m here today visiting with Richard Dasher. He’s a consulting press professor at Stanford University. And Rich before the break, we’re talking about the trends that were coming up in your years, primarily specializing in Asian markets.

Richard
That’s correct. But anything that connects us and Asia, because a lot of the new business really requires cross border thinking from the beginning.

Alan
Now let me ask this question. So I have I’m in some little venture funds and seven them they’ve taken like gate companies public in China, and clearly there’s cultural differences between how one country thinks versus the other. And and so we, we solve that by when we put money over there. We ask the if this is going back to China and say, Well, okay, this is the US money, this is China money. And the US money, you have to follow our rules. And for every dollar you invest, well invest side by side. And they have a standard way of doing business with government officials and stuff that that does not meet the standard of this country. How do you deal with that, in in, in the scheme of when you look at crossed the border and acclimating between cultures?

Richard
Well, this is one way in which business is much more complicated if you do it on an international scale. So one of the main things about doing business in China is to know who you’re dealing with. And so I’m on the advisory board for a small company that’s doing due diligence consulting for potential investors in China. And I think probably the majority of what this company does is look into the backgrounds of the managers of the companies to find out who they’re connected to, and what’s likely to be motivating them. That’s one area, your approach to using the funds from the US in a kind of different way to using the funds in China is certainly the way that a lot of companies have managed to be successful there a lot of times that involves an offshore company someplace like the Cayman Islands, for the American money, the US money to go into. And then there will be an operating contract with a domestic entity in China. One of the other issues in China is that the regulatory framework is extremely complex, and in some ways, contradictory. And this is one reason close personal ties to people in the government is so are so widespread among companies in China, it’s really a way of hedging risk, because that gives you a kind of insight into how the the regulations are going to be executed, implemented. This is, you know, it’s it’s complex, but the opportunities are so big, that people really can’t just sit aside and let them go their separate way.

Alan
I read recently that China wanted to remake the banking industry and make it a little bit more looser with you know, more capital markets. Are they going to succeed at that make that transition?

Richard
I wouldn’t expect that by happen anytime soon, I think that they’re more likely to come closer to the standards that are in the rest of the world. In fact, we’re starting to see a few of the successful new Chinese companies that are really starting to play like multinationals and really follow the accepted rules worldwide more than they did. And I think that the growth you see in companies like Huawei Technologies, or Lenovo, these are both companies that are really trying very hard to be Western in the way that I approach things.

Alan
You know, it seems that that that the world, in essence is growing a lot smaller. Is the credit markets affecting the the trade internationally? And let me ask that I heard Greg Whitman speak recently. And Meg, when she got up she was talking about, you know, that we manufacture in China, we got a cheap labor rate, but the logistics to get the product over here tremendously expensive. Yeah. And so what do you think about the trend? Do you see that continuing on?

Richard
Well, I think the logistics is one of the main reasons that has enabled global business. When you think about the 10s of 1000s of miles that every part in if you look at a computer, or you look at a digital camera, the insides of that thing have traveled for a total mileage of probably halfway to the moon. And to be able to do that with a low cost basis is absolutely critical. Now the supply of money is an important point. And I do think that you’re seeing capital markets really grow at a rapid rate and Asia throughout Asia,

Alan
I’m visiting here today with Richard Dasher from Stanford University. Entrepreneurship. We’ll be right back after these messages.

Alan
Welcome back. I’m here today with Richard Dasher at Stanford University. He’s a PhD and he’s involved in the entrepreneur ship program over there and also US China relations. And before the break, we’re talking about business doing business in China. Richard, from your research, what do you see the number one concern you’d have about what’s happening?

Richard
There are several concerns about China. One is political stability. I think I do hear a lot of people in China who are kind of not real happy with the current situation. But I think probably in terms of capital and the flow of money. The biggest thing is whether China is going to go through a stage where it copies Japan and South Korea by having a set of large companies that have an inordinate amount of power in the national economy. So capital is too highly concentrated in the big business groups in Japan and in Korea, and they’ve had a real hard time getting away from that model and freeing up capital to go after really new ideas that aren’t already in somebody’s back pocket as it were. China may have a tendency to create similar big businesses, and go after the kind of short term stability that comes from picking winners and having a few big companies that are flagships for the entire nation. I’m concerned that that will eventually diminish the quality of entrepreneurship and China. Right now entrepreneurship in China is equally driven between a sense of necessity, and a sense of opportunity. And the opportunity driven entrepreneurship is really what makes an advanced economy strong. Necessity means you’re an entrepreneur because you couldn’t get a job anywhere else. And so to move into this area where you have opportunity, you really need the best people going after the best ideas and getting the right kind of help in order to be successful. So if the best people are siphoned off because they don’t see opportunity for themselves outside the context of a big company, then you really have an in flexibility in the labor market. and certainly capital follows the ideas and the people around that becomes inflexible. And it’s really hard to change the entire system all at once. That’s what Japan and Korea have been trying to do for the last 15 years or so. And they’ve had limited success. But there’s still a sense that if you’re really up at the top, you’re gonna wind up working for a big company.

Alan
You know, I heard that Well, I have a perception with China that big companies that have gone over in the past have found their products to be reverse engineered. is a trend still there? Do you see that they’re taking responsibility and patent protection.

Richard
This is one of the cultural things about China is not so much patent protection, the laws in China have improved a lot. The execution, the implementation of the laws, is not quite as far along. And I think that you also see that just in terms of general attitudes toward competition. In the US, typically, you have an early stage industry, with an almost chaotic situation with a lot of different companies coming up with different kinds of things. Then as a few of the companies become dominant, people naturally look for related but new ideas that are a little different. You see this in the cloud computing area right now, after Facebook and Twitter have come onto the stage, you’re not going to have exactly the same kind of social network platform that they’re doing, in contrast in China, is a company becomes more successful. And I’m thinking about Tencent, which was one of the companies that is involved in instant messaging and involved in a wide range of different kinds of online community activities. Their success continues to breed competitors, so that you have 30 companies this year that are competing directly in the same kind of area. That sort of chaotic situation, is kind of an indication that intellectual property is less seen as an asset that is protectable.

Alan
You know, last weekend I spent with Mitt Romney in Park City. And one of the countries that he mentioned from the party was Vietnam. He said, you know, 30 years ago, who would ever thought that Vietnam would be the the economic, emerging economic nation that it is today? Comment,

Richard
Vietnam is a really interesting place. Just like China, it’s got a government that’s very much in control. However, unlike China, Vietnam is relatively straightforward in terms of what the government structure is. In China, you have competing regions and competing city governments and different levels of the government structure that make for a very complex regime and make it very hard to do business there. The American Chamber of Commerce said that the most difficult thing, American Chamber of Commerce in Shanghai, so the most difficult problem for American businesses in China are contradictory regulations, usually, so Vietnam is kind of monolithic. And they’ve used that very well. They’ve got 90 million people, they are developing an education system, they’re coming from way behind the labor cost is lower than China now. But except for not having as big a market as China, they have really strong possibilities for becoming a place where you’ll see a lot of new business.

Alan
He CLC this strong trend and outsourcing of labor. What about the jobs in America? I read something in Michigan, about now we’re getting to produce a television set, it was like a big win for the USA. What’s your take on the the outsourcing jobs into the future?

Richard
Well, that is a problem that goes beyond economics, because our leaders really do need to look at what’s good for the maximum number of people possible. But there’s a natural outflow of lower end jobs, out of an advanced economy and into a cheaper economy. And no matter what economy you’re in, there’s probably always going to be someplace cheaper. That means that it will be difficult to keep jobs, like high school educated, very high paying line manufacturing jobs in the US, unless there’s some sort of innovation or some sort of special skill that’s involved in that position.

Alan
So transfer the future at Google came out with Google glasses today. And what do you think about This Star Trek type technology,

Richard
well, I see a generation gap. And unfortunately, I have too many gray hairs to really appreciate just the full potential of Google Glasses, I have a feeling that my 26 year old daughter would be a much quicker person to see exactly what she could do and feel much more comfortable using these things. To me, it drives me crazy to have all this, you know, text information coming out of one of the, the eyeglasses. But I think that this is a great indication of how a big company can stay innovative. Google is a very large company, and Google has all sorts of projects going on internally. I also saw a project this morning that they’re doing development of an autopilot automobile. And so to be involved in that kind of thing. has a wonderful sort of morale effect on everybody associated there, as well as you know, being part of the pipeline of creating new business.

Alan
I’m visiting here today with Richard Dasher, he’s a professor, PhD from Stanford University and Richard, appreciate you being on today’s show. And do we’ll be right back after these messages.

 

 

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About Richard Dasher

Richard Dasher has been Director of the US-Asia Technology Management Center since 1994 and served concurrently as Executive Director of the Center for Integrated Systems since 1998. He holds Consulting Professor appointments in Electrical Engineering (technology management), Asian Languages (Japanese business), and at the GSB (with the Stanford Program on Regions of Innovation and Entrepreneurship).

From 2004, Dr. Dasher became the first non-Japanese person ever asked to join the governance of a Japanese national university, serving as an outside Board Director and then on the Management Council of Tohoku University until 2010.

He serves on selection and review committees of major government funding programs for science, technology, and innovation in Canada, Germany, Japan, and Hong Kong, and he maintains an active management consulting practice in regard to company creation and growth, strategic management of technology, and new business opportunity identification.

He is on the boards of several companies and nonprofit organizations, and he is an advisor to start-up companies in the U.S., Japan, and China. His current research centers on innovation systems and technology-and-business forecasting.

Dr. Dasher received M.A. and Ph.D. degrees in Linguistics from Stanford University and is co-author of the book “Regularity in Semantic Change.”

From 1986 – 90, he was Director of the U.S. State Department’s advanced training centers in Japan and Korea that provide full-time language and area studies training to U.S. and Commonwealth Country diplomats assigned to those countries.

See Stanford bio also.