The Medici Effect Blog

Positive effects of immigration

I just want to share another example of benefits of migration: In Nigeria immigrants from Zimbabwe have brought with them new methods and new kinds of cattle that have improved agriculture in the country significantly. It is interesting that these things still happen and that the movement of people makes a difference in such a basic way.

/Kristian Ribberström

Diversity as a business advantage

In a recent post I argue that the influx of Iraqi refugees to Sweden is beneficial to the country in a longer perspective; their knowledge, experience and language skills will be extremely useful as Swedish export industry need to enter into new markets. This aspect of immigration is never discussed since the short-term practical problems with integration dominate the debate about our relatively generous asylum laws.

Anyway, after I wrote that the Swedish Trade Council has identified the Middle East as one of our most important potential export markets. I just wanted to point that out since it supports my argument, doesn’t it?

/Kristian Ribberström

Overlapping cultures and business creativity

I wrote a post in November from Budapest where I reflected on the way Hungarian society is changing rapidly and the capital is becoming increasingly diverse. Now I am here again and I see further evidence of diversity - in my own subjective way.

Wherever I travel I have the habit of making reflections on how internationally "connected" a certain situation is. I know it sounds a bit weird but it is fun and it will give you some kind of unscientific index on how affected the place or situation is by globalization. This is an example of how it works: When I was visiting Frans in the US earlier this spring I was standing in a shop on Manhattan thinking to myself: Here I am - a Swede in New York, buying an Italian bag from a Russian shopkeeper as a gift for my Hungarian girlfriend. Several nations "involved" in that single purchase. And that is not because New York is a extreme city - you can easily see similar "chains" in places that are not nearly as big or multicultural. That is just the way modern society works.

In Hungary some ten or fifteen years ago, however, it wasn't like that. The reflection chain would be something like: Here I am - a Swede in Budapest. And that was it. Possibly with the addition drinking Danish beer (which isn't very exotic to a west-coast Swede.) Now - in 2008 - things are different. Being unable to stop this behaviour, I was thinking while having dinner the other night: Here I am  - a Swede in Budapest, drinking Mexican beer in a Persian restaurant while we are being entertained by a Turkish belly dancer (which is very exotic to a west-coast Swede) and trying to figure out if the people at the other table are from India or Pakistan. Budapest really has changed.

And here is the thing: Everytime I manage to make a "long chain" I am in a situation where I spend money - and where other people spend money. In other words there seems to be some kind of correlation between mixed national perspectives and entrepreneurship. Maybe these overlapping layers of diverse national experiences and skills automatically provide a divergence of ideas - and divergent thinking is what generates innovation. If that is true these longer chains I reflect upon is a sign of fertile soil for what we could call business creativity. Furthermore - an idea that is conventional in one place may be vital and even innovative elsewhere; a Persian restaurant will undoubtedly have less competition and higher profile in Budapest than in Teheran.

Well, this is not research - just thoughts. And I am just a Swede in Budapest. Spending my American money.

/Kristian Ribberström

Workforce diversity mirrors the global market

In his speech at The Medici Summit Omar Hijazi, CEO of Dubai-based Tejari, pointed out that many emerging markets are underestimated by Europe and the USA. In the Middle East, Asia, Africa and South America the power to consume as well as produce is growing rapidly and very soon this will have a huge impact on the “old” industrialized countries. The general awareness of this development is surprisingly low in this part of the world.

I was reminded of this when I read an interview (Swedish) in Dagens Nyheter with Ulf Berg, CEO of the Swedish Trade Council. Berg shares Hijazi’s insight and he is very critical of the way Swedish companies are missing export opportunities simply because they lack knowledge of the emerging markets. Or, as he puts it: The problem is not the view people around the world have of Sweden – the problem is the view people in Sweden of the rest of the world. Berg believes that Swedes are too isolated and mostly associate these countries with cheap labour and low-cost production. The global development over the last ten years hasn’t affected Swedish trade much which may be a fatal mistake since the economy depends heavily on export.

I see a very strong connection to cultural diversity in the workforce here and my argument is this: One of the greatest potential benefits of diversity in a country’s workforce is that it mirrors the population, the cultures and the languages of the world - and the world is the export market. This benefit is hardly ever acknowledged.

Let me explain it with an example: Swedish immigration policies are relatively generous - partly for humanitarian reasons but also for demographic reasons. But when immigration is discussed it is mostly in the context of problems that need to be solved. One such case is a town called Södertälje. With some 80,000 people it has become the destination of 5% of all the Iraqi refugees that come to Europe. This means that Södertälje accepts more Iraqi refugees than the USA and Canada together and today there are about 100,000 people of Iraqi origin in Sweden. Because of this situation Anders Lago, the top politician in Södertälje, was invited to speak at the Congress in Washington last week. In his speech Lago acknowledged that immigrants are needed and welcome in Sweden but that responsibility for Iraqi refugees must be more evenly distributed; immigration has become a burden in his town.

However, since we are missing export opportunities because we lack knowledge of the world around us we need to look at immigration in a new way and in a longer perspective. I understand that successful integration is hard to achieve in Södertälje, but the questions we must ask ourselves are the following: Is it good or bad for Sweden to have 100,000 Iraqis in the workforce who speak Arabic and other languages? Is it good or bad to be able to harness the experiences of 100,000 people who have knowledge of traditions, tastes and values in a part of the world where we need to do business in the future? The answers to these questions are quite obvious. I think the conditions for integration would be greatly improved if this perspective was included in the discussion.

/Kristian Ribberström

The Burqini revisited

It has been more than a year since I heard about the Burqini the first time and it has been more than six months since I wrote a post about it. I like the story of the Burqini since it is such a great example of creativity at the intersection of cultures and I often use it to describe the mechanisms that make diversity and mixed cultural perspectives drive innovation.

Over the last months I have realized that the online discussion about this product has been gaining momentum. Opinions about it can be read on blogs about Islam, lifestyle, fashion, integration, politics, sports - you name it. In this media flow a couple of articles from Holland and Sweden caught my attention; it seems that the Burqini is actually being used in these countries and that it has made many Muslim women visit swimming pools and shores in a way that they didn’t do before. This too has caused debate - people react when they see things they haven’t seen before. Many swimming pools have rules about what you are permitted to wear in the water and often it is unclear how the Burqini should be treated in this respect. As I have mentioned before the debate on multiculturalism is continuous in European countries and the integration of Islam is far from friction free.

But friction is an inevitable part of the process that makes diversity drive innovation. If the Burqini makes people come to places where they wouldn’t have gone without it and mix with people they wouldn’t otherwise have met it may be a slow but effective tool for integration. And integration, naturally, makes it far easier to leverage diversity for innovation. Remember – it was such a mix of cultures that created the Burqini in the first place. Wouldn’t it be nice if this Lebanese-Australian invention could catalyze new diversity-driven innovation?

/Kristian Ribberström

Migration causes controversy and innovation

Last week Tom Barnett wrote the post Heightened immigration is a global phenomenon in which he refers to a couple of articles in The Economist about global migration and reports about, for instance, Poles in Ireland. (Very good articles!) He poses a question about integration policy which has stirred a rather typical immigration debate among his readers.

Whatever the consequences of immigration are, Poland really is an interesting example that explains some reasons behind people movement: Ever since the country joined the EU large numbers of Poles have moved elsewhere for better paid jobs, especially to Ireland but also to Iceland and other countries. However, over the next couple of years Poland will be showered in EU money to stimulate the economy and there will be a huge demand for labour. This is not unproblematic since emigration to western countries has greatly reduced the work force. According to some analysts this “labour vacuum” will be filled with people from Ukraine and Belorussia. In other words migration drives migration. On the other hand, Philippe Legrain (to whom I have referred in this recent post), describes on his blog how the Poles are starting to return back home from Great Britain. That says something about how difficult it is to predict migration patterns.

The Poland situation is only one example of the forces behind people movement. But whatever the reasons are, migration almost always causes controversy; it seems that for many people it is easier to find the negative aspects of it. I have said it before and I will say it again – it’s a pity that even among those who argue that migration is a positive phenomenon it is merely regarded as a matter of labour supply and demand. The idea that movement of people drives innovation is sometimes mentioned but rarely elaborated or used as a substantial argument. Yet there are many examples: It may be the invention of a new product, an old business concept that prospers in a new setting or award-winning research. It is far from difficult to find such examples.

Researcher Richard Florida talks a lot about tapping the creativity of individuals and clearly moving from one context to another is an effective way of doing that. These processes would probably work even better if people had a more positive attitude towards immigration; if it generated less controversy it might generate more innovation.

/Kristian Ribberström

Sarkozy’s dilemma

As you have seen before I base many posts on the premise that movement of people is good for innovation – it brings mixed perspectives and therefore also creativity. But, sadly, when migration is discussed in Europe the focus is usually on negative things such as illegal immigration or problems of segregation. Maybe this will change due to the problematic labour supply situation that many countries are facing. At least the debate about migration is getting increasingly nuanced.

French president Nicolas Sarkozy has definitely become aware that there are many aspects to take into consideration. He has to react to a report where one conclusion is that France needs more immigrants; it is crucial for future growth and it is necessary to break economic stagnation. Although he acknowledges this the report it is not completely unproblematic to him. He won the presidential election with a more convincing popular support than many had expected – partly as a result of his firm stance during the suburb riots a couple of years ago. He promised to deal with the problem of illegal immigration and that gave him support from many right-wing voters who are negative to immigration as a whole.

Instead of acting to make it tougher to be an illegal immigrant in France Sarkozy must now act to make it easier to become a legal immigrant. This is by no means the opposite of what set out to do but it is undoubtedly a different course. Whether he wants to admit it or not there are voters who will feel that he fails them. (And those voters will probably not be convinced by figures on demography and growth.)

France is far from unique in this respect and the idea of increased immigration to solve the problem is not new. Philippe Legrain, for instance, explores it thoroughly in his 2006 book Immigrants: your country needs them. Nevertheless it will be really interesting to follow the development in France. The irony is that French scepticism about the expansion of the EU was very strong since many feared a massive influx of Eastern European professionals...

/Kristian Ribberström

The Nobel Prize and creativity

Many reflections on creativity and innovation can be made regarding the Nobel Prize. Each award represents groundbreaking achievements of the highest order and so far more than 700 men and women have become Nobel Prize laureates. Today, December 10, that list will be a couple of names longer.

In order to connect this to innovation through intersections of fields and cultures I will relate some research by Professor Gunnar Törnqvist. He specializes in Economic Geography and is a member of the Royal Swedish Academy of Sciences. He has devoted a lot of work to studying the creative processes behind the science prizes. Based on a vast material of statistics, biographies and other sources he has looked at factors like family background, education, career choices, collaborations, movement between countries etc. Some findings are expected and others are more remarkable.

For instance, it is estimated that 20 percent of all science laureates grew up in Jewish homes in Europe. Törnqvist discusses different explanations for this overrepresentation. One is that being part of a minority makes an individual familiar with different cultures – the one at home and the one of the surrounding society. Such natural switch between perspectives cultivates an open mindedness that is an advantage for any scientist in search of new answers. Another factor is that most of these scientists had to leave Europe and therefore continued their careers at the top universities in America instead. If you look at the lives of innovative researchers (like the Nobel Laureates) it seems that it is an enormous advantage to have moved between countries and universities; it results in a mix of perspectives and many meetings.

Many of these men (yes, they are all men) are originally from Hungary and therefore they also belong to another group that is astonishingly overrepresented among Nobel Prize laureates: Scientists who, as young boys, were educated at the finest high schools in Budapest in the beginning of the twentieth century. According to Törnqvist 20 of the top scientists of the last century grew up in Hungary. He argues that there is more creativity in times of turbulence and Budapest really was diverse and politically instable in those days. Almost all of these Hungarian laureates-to-be migrated to America and Törnqvist stresses the importance of this move from one academic context to another.

He convincingly shows that there is a pattern; that there are circumstances that inspire and catalyze innovation and that exposure to different perspectives and cultures has a significant impact on the creative performance of individuals.

/Kristian Ribberström

Innovation – sometimes a matter of location

Twelve years ago Swedish born Kristina Karlsson came to Melbourne with nothing but two empty hands and she had no business experience. In 2001 she started the stationery label kikki.K that today has 300 employees and a turnover of roughly 40 million USD.

Hard work is certainly an important factor behind the success, but, interestingly, the fact that she is a foreigner was a crucial asset. When she identified a gap in the home office market she filled it with a label that sells simple, timeless and stylish stationery products in a typically Swedish design. They would hardly be regarded as original in Scandinavia but on the Australian market they represented something new and were welcomed by enthusiastic buyers. kikki.K is now established in many cities in Australia and New Zeeland and Karlsson has received business awards as well as media attention.

The rapid growth of the young company is impressive and it is a great example of business innovation driven by the movement of people. When you act in a context that is different from the one where you grew up there is a much greater chance that your thoughts and ideas will be divergent from the ones around you. In other words rather obvious ideas may be innovative if you exploit them on a new location or in a foreign culture.

It would probably be hard to launch kikki.K successfully in Sweden in 2001. But in Melbourne - practically as far away from Sweden as you can come – Kristina Karlsson placed herself in the intersection of Swedish design aesthetics and the Australian market and it worked more than well.

/Kristian Ribberström

High ambitions with student mix at EU universities

America has a long tradition of letting large numbers of foreign students enrich universities. The quality and success of the research this has led to supports the idea that diversity is good for creativity. It has long been an ambition in the European Union to stimulate movement of students between the member states and now this circulation of talent seems to gain momentum. For instance, the spring term application process to Swedish universities is now finished and there are more foreign students than ever – just above ten percent.

Earlier I have reported examples of what Swedish and Hungarian universities do to attract foreign students but the record figures mentioned above is mostly a result of the Bologna Process. It started in July this year and is a standardization of European university degrees.

The aim is more interaction, more international atmosphere and more exchange of experiences. Hopefully the long-term effect of mixed perspectives will be a development that is similar to the successful American model.

/Kristian Ribberström