A country as a Proof of Concept lab?

Hello, all! This is my first post as the new Board of Innovation Ambassador for Portugal and Spain, and I’m looking forward to contribute to this blog.

Today, I’m going to focus on Portugal, which made the headlines last week, maybe not for the best of reasons. But leaving that on the side, what I bring today to the table is the fact that small countries can be very interesting labs when one wants to do a Proof of Concept for a product, or test the market, before a world wide deployment. When you want to launch a new product or test a new business model on a global scale, you usually want to be sure that it makes sense and works, otherwise consequences can be quite serious (and costly). The answer is to do a Proof of Concept, and for that you usually need the following:

1. A big enough market so that it is statistically representative: You need to test a concept that then can be replicated to other bigger and different markets, and the behavior needs to be sound and consistent enough to be transposed to those markets.
2. A small enough market, so that consequences of a flop are mitigated: The experience can’t cost too much and must be doable with reasonable resources.
3. A controllable enough market, so that you can understand all the variables at play: You need to control all the main variables, otherwise it is not an experiment.
4. A market who is not too biased by legacy and open enough to new things: If here is too much tradition, or a conservative market, it is difficult to push through new ideas or concepts. The ideal is to pick a country who has developed recently, likes novelty and a lot of things still have to be done.

This is why sometimes multinational companies, specially in the Information Technology sector use Portugal as a Proof of Concept lab when they want to launch new products. I can remember Cisco, after acquiring Scientific Atlanta, who wanted to test their set top boxes in a widespread installation in a cable/ipTV environment.

This is also why it was not too hard for TMN to succeed at launching the first pre-paid mobile phone plan over almost 2 decades ago. And Brisa launched quite a few years ago a system called Via Verde, who first allowed you to pay highway tolls and now let’s you pay parking and pump up gas with a simple electronic transponder glued to your car’s windshield.

And SIBS, which is a not for profit company whose shareholders are the entire banking system in the country, manages all the ATM machines in the country and offers in every single machine everything you could want from a bank counter, open 24h a day. And you can also create a virtual and temporary credit card if you want to do some on-line shopping without giving away your normal credit card number. I’ll be digging into each of these interesting innovation examples in detail in the next posts, and then will also do an in depth analysis of Spain.

Cheers,
Pedro Cerdeira
Ambassador for Spain and Portugal

pedro