S’pore needs to think outside the box

February 17, 2005
Singapore Democrats

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Sumathi Bala
Financial Times
17 February 2005
http://news.ft.com/cms/s/29fb70c8-808c-11d9-bed2-00000e2511c8.html

Singapore is always placed high in global economic competitiveness polls, with most surveys underlining the government’s success in creating a business-friendly environment.

However, the same cannot be said of its corporate and organisational leadership. A recent poll found Singapore chief executives, especially those from the private sector, to be uninspiring in general, and poor at developing talent and grooming successors.

Extensive research of leaders in Singapore over three years revealed their performance compared unfavourably with their peers from the US, Europe, and Australia/New Zealand on all key measures that drive workforce innovation, engagement and performance.

Notably, they were considered less visionary, less optimistic, less willing to challenge old ways of doing things, less likely to sacrifice their self-interest, and less likely to pay attention to the moral and ethical consequences of their decisions.

The study, conducted by the Singapore Institute of Management, the Gallup Organization and the Gallup Leadership Institute, University of Nebraska-Lincoln, involved a poll of 1,010 Singaporean workers and surveys of 32 small and large enterprises across several industries.

It also involved in-depth interviews with 24 leaders in the public and private sectors.

The poll findings certainly make for grim reading. For a tiny country with no natural resources and whose people are its most valuable asset, having a flexible and entrepreneurial workforce to compete effectively in a fast-changing environment is crucial.

Continued economic success depends on having corporate leaders who can rise to fresh challenges, offer a bold vision and expand abroad successfully.

Policymakers have been encouraging domestic companies to “think and go global,” and pushing to achieve a creative and entrepreneurial environment in the past few years.

In spite of numerous campaigns and investments towards remaking Singapore into a “thinking and learning nation”, progress has been slow.

According to the survey, those heading companies and organisations are not good at encouraging an innovative spirit among their employees.

A typical Singaporean leader tends to be performance-driven and authoritative, and reactive rather than pro-active.

However, there is no doubt that Singapore has a good pool of well trained, experienced managers who can run a business effectively.

Given Singapore’s loose regulatory environment and the government’s pro-business policies, setting up and operating a company is not difficult in the city-state. There is little room for bureaucracy or mismanagement.

But the government’s strong influence over business and economic direction has also led to a degree of complacency, with most managers failing to take the initiative and averse to risk-taking.

As a result, most corporate leaders in Singapore prefer to stick to tried and tested management styles and policies, rather than push the envelope and break new ground.

Among the key Asian economies, Singapore has the highest proportion of state-owned or government-linked companies. Forty-five per cent of Singapore’s top 20 companies, for instance, have state shares of more than 20 per cent.

The proportion among Korea’s top 20 companies is 15 per cent, and among Japanese and Hong Kong enterprises, 5 per cent.

The majority of both government-linked companies and private sector groups have a top-down management style, which, critics argue, has stifled creativity and innovation in the workplace.

“Part of the problem with a top-down method is it becomes very performance-driven,” says Dr Bruce Avolio, director of the Gallup Leadership Institute, which helped undertake the research. “This leads to a lack of focus on talent development.”

There is also very little receptivity to employee feedback, a point underlined by the survey.

Singaporean workers felt the leaders in their organisations do not get them to look at problems from different angles. There is also no encouragement to be more creative or entrepreneurial. Most felt their best ideas were not implemented. All these areas were rated low in the poll.

Gallup describes the average Singapore leader as intellectual, but not intellectually stimulating.

“There is a great emphasis on rewarding and valuing high academic scholastic standards, and promoting people on past experience,” says Dr Avolio. “In a city largely based on technical fields, it doesn’t mean top engineers can become effective leaders. To be a leader means you need to possess key universal strengths.”

These include: ability to spot and develop talent, allow room for alternative ideas to flourish, ability to envision a future and apply it to the present, have high integrity and ethical standards, and lastly be able to communicate your ideas and objectives within the organisation and to others.

According to Dr Avolio, leaders who possess the key qualities would be able to inspire their workers and create an environment where employees would feel a greater sense of ownership of what they do.

The challenge for Singapore is clear. With China and India steaming ahead at breakneck speed and other countries in the region developing fast, growth for the city-state depends on expanding its reach beyond its domestic shores.

But, to heed to the policymakers’ call to “go global”, Singapore leaders have to step up and take charge.

Gallup hopes the survey has helped raise awareness of the critical issues facing Singapore’s leadership styles and development.

As Dr Avolio points out: “A fundamental question now is: If Singapore wants to become a ‘thinking and learning nation’, able to compete by using the full potential of an engaged workforce, what are its leaders willing to do to make this happen?

“To create value based on driving innovation will require a fundamental refocusing on how leaders are selected and developed in Singapore.”

There needs to be a clear shift in mindset and priorities. A closed and regimented leadership style may have worked in the past. But as economic progress brings nations closer, the need for an open and consultative leadership direction has become more critical to adapt to a fast changing global environment.

Creativity and entrepreneurship have been buzzwords in Singapore’s business circle for years. But little has been done to achieve them.
Unless Singapore’s corporate leaders dare to think “out of the box”, and take bold actions, the desire to achieve a creative and entrepreneurial culture will be unfulfilled.