Last week, a friend of mine urged me to join him at a Tedx conference in Kuala Lumpur.
Tedx conferences, for those of you who don’t know, are events that offer individuals or groups a way to share ‘ideas worth spreading’. Local speakers are invited or nominated to share their insights under a theme decided by the local event organiser.
Last week’s one was called “The open future – be the ripple effect”.
“It starts at 7.45am and ends at 10pm”, my friend said, “I think you’ll really enjoy it.”
It sounded cool, but in the end, I couldn’t make it due to other commitments.
But since then, I have been reading a lot about more of these conferences taking place across Asia.
A few months ago in Hong Kong, the theme was “The next chapter”.
Last year, people in Jakarta focused on “Generation anxious”.
On 27 September, there’s one taking place in the Thai city of Chiang Mai. It’s called “Creating connections“.
All of these ideas are being trumpeted by a demographic that’s about to become very important to investors. Let’s have a look at who they are.
Asia needs to start thinking outside the box
Across the world, ‘millennials’ – those born between 1980 and 2000 – are set to have a major economic impact and become the single largest spending group.
It is estimated that by 2020, nearly two-thirds of millennials will reside in Asia and become the main driver of the region’s economy. Therefore, companies will have to adapt to accommodate their demands and preferences over the next five to ten years.
But millennials are also changing Asia in other ways.
For instance, if you’ve travelled around Bangkok, Kuala Lumpur or Singapore lately, you might’ve noticed a boom in artisan coffee shops. These are often managed or owned by millennials who have studied overseas (Australia, New Zealand, UK, US).
Meanwhile, there’s been a surge in interest in local art, fashion and design as many people decide to pursue a career in a creative field. Local auction houses, carnivals and galleries are also starting to mushroom.
These are just some of the way millennials in Asia are making their presence felt in many fields.
But why is all this so important?
The short answer is the fear of the ‘middle-income trap’ – a phenomenon where rapidly growing economies stagnate at middle-income levels and fail to graduate into the ranks of high-income countries.
In order to avoid this, countries need to make technological innovations or improvements. It’s something every developing country faces, but until now, nothing has been done about it in Asia.
New ideas lead to new opportunities
As things stand, many leading Asian corporations are family-controlled. They were founded by tycoons who belong to the ‘silent generation’ – those people born between 1920 and 1945, who lived through the Great Depression and WWII.
These corporations have been built by sticking to the rules and being frugal. This has helped Asia advance to a certain level of prosperity, but it has limits.
Many millennials working in Asia feel that those rigid hierarchies and out-dated management styles failed to get the most out of younger recruits. Half felt that senior management could not always relate to younger workers.
I think the choice of topics at the Tedx conferences shows the sort of things millennials are interested in. These are worlds away from the old style of leadership.
Millennials in Asia are better educated than previous generations, more widely travelled, and most importantly, they’re more connected to the rest of the world making it hard to hinder them accessing novel ideas and processes.
Smart employers will start to accommodate their needs and wishes in order to ensure their companies continue to prosper. Already in Singapore, the candidate-driven market has started pushing wages up.
And importantly, harnessing the potential of millennials yields positive results for all parties. In recent times, job advertisements have risen 59% in Singapore. By encouraging innovation and new ideas, companies are creating more opportunities and greater productivity. This will enable countries to avoid the middle-income trap and reach true developed status.
As a long-term observer of corporate Asia, I see more millennials being given free rein to pursue their own ideas and solutions. I believe this transition will create an abundance of opportunities for us as investors.