Johnson & Johnson’s choice of regional headquarters and innovation hub: Why Singapore?
In 2019, Ai Hua Ong, Group Chairperson, Asia Pacific of Johnson & Johnson (J&J), was ruminating over the choice of Singapore as the company’s regional headquarters (RHQ). While political stability, ease of doing business, a start-up friendly and open innovation ecosystem and supportive gover...
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| Format: | text |
| Language: | English |
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Institutional Knowledge at Singapore Management University
2020
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| Online Access: | https://ink.library.smu.edu.sg/cases_coll_all/336 https://smu.sharepoint.com/sites/admin/CMP/cases/SMU-20-BATCH%20%5BPDF-Pic%5D/SMU-20-0002%20%5BJohnson%20&%20Johnson%5D/SMU-20-0002%20%5BJohnson%20&%20Johnson%5D.pdf?CT=1600135103288&OR=ItemsView |
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| Institution: | Singapore Management University |
| Language: | English |
| Summary: | In 2019, Ai Hua Ong, Group Chairperson, Asia Pacific of Johnson & Johnson (J&J), was ruminating over the choice of Singapore as the company’s regional headquarters (RHQ). While political stability, ease of doing business, a start-up friendly and open innovation ecosystem and supportive government regulations had built an ideal climate for the city to function as a base for a RHQ, many other cities in Asia provided tough competition to the city country.
Moreover, while co-location had been widely recognised as one of the drivers towards the effectiveness of the innovation ecosystem - emerging technologies like hologrammatic communication could make the need for the RHQ model outdated. In the R&D space, the need for a skilled workforce could be alleviated by employing technologies like Artificial Intelligence. For the purpose of collaboration, blockchain technology could be applied to enable firms to share data more securely over longer distances. The use of Internet of Things (IoT) in the biomedical sciences sector, could reduce the need for being close to the consumer for R&D and market research; while the increased use of 3D printing devices could make Singapore’s advantage as a logistical hub in the region less salient, as designs could be shared virtually and printed locally.
Amidst such tugging tensions, Ong wondered if Singapore would continue to remain an attractive destination as an RHQ? Would its innovation-ecosystem suffice as a sustained differentiating factor? Could the concept of Technology Hub be an alternative path?
The case focuses on the key considerations of setting up an RHQ for large multinational companies and the significance of innovation ecosystem in this context. The case comes with an online teaching outline in the Teaching Notes and allows students to understand how Singapore stands apart from other cities in Asia as a choice for RHQ. It also discusses the use of hub and spoke strategy model to cope with diverse market needs. |
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