SINGAPORE
FRANCIS PIRON, Ph.D., 2013
BASIC FACTS
•
•
•
•
•
•
ONE OF THE FASTEST GROWING ECONOMIES
FROM 3d TO 1st WORLD ECONOMY
GOVT. BEHAVES AS AN ENTREPRENEUR
PATERNALISTIC APPROACH – NANNY STATE
HEAVY DEPENDENCE ON ELECTRONIC SECTOR
LACK OF ENTREPRENEURIAL, RISK-TAKING &
CREATIVE SKILLS AMONG THE PEOPLE
• OVERWHELMINGLY CHINESE
LOCAL & EXTERNAL FORCES INFLUENCING
THE MGMT CONTEXT OF SINGAPORE
• FORCES OF HERITAGE - LOCAL & REGIONAL
INFLUENCES
– UNIQUE HISTORY
& GEOGRAPHY
BRIEF HISTORY
• LONG HISTORY AS A TRADING POST
• SMALL ISLAND WITH LTD NATURAL RESOURCES
=> NEED FOR PRAGMATIC & OUTWARD
ORIENTATION, FLEXIBILITY, QUICK TO ADAPT
• EARLY CHINESE INFLUENCE => ARRIVAL OF
CONFUCIANISM & BUDDHISM
• LEE KUAN YEW ELECTED PM IN 1959 (FOR 31 YEARS);
INDEPENDENCE IN 1965
• LEE KUAN YEW, THEN SENIOR MINISTER & NOW
MENTOR MINISTER
SOCIO-CULTURAL ISSUES
• HISTORIC ETHNIC DIVERSITY + 250 YEARS OF
BRITISH COLONIAL RULE
• CHRISTIANITY IS ASSOCIATED WITH THE BETTER
EDUCATED CHINESE WHO TEND TO SPEAK
ENGLISH AT HOME
• ECONOMIC DISPARITY ASSOCIATED WITH ETHNIC
& RELIGIOUS AFFILIATION
• 72% CHINESE
• MODERN MGMT SYSTEM, STRUCTURES &
CULTURE BASED ON CONFUCIAN HIGH WORK
ETHICS
SOCIO-CULTURAL ISSUES
• SINGAPOREAN GOVERNANCE & DEVELOPMENT
MODEL:
–
–
–
–
–
–
–
COLLECTIVE ENTREPRENEURIAL SPIRIT,
EMPHASIS ON EDUCATION,
HIGH SAVINGS RATE,
POSITIVE OVT. INVOLVEMENT IN EXPORT EXPANSION,
DYNAMIC COMMUNITY SPIRIT,
LOYALTY TO EMPLOYERS
BEHAVIOR SHAPING & SOCIAL ENGINEERING
POLITICAL & ECONOMIC
MANAGEMENT FRAMEWORK
• PRO-BUSINESS GOVT DEVT = SINGAPORE INC.
• PAP (PEOPLE’S ACTION PARTY), IN POWER SINCE
INDEPENDENCE, IMPLEMENTED STRATEGY TO
TRAIN BRIGHTEST FOR TOP-PAYING GOVT.
CAREERS
• WITH NO LOCAL ENTREPRENEURS, GOVT
BECAME THE ENTREPRENEURIAL LEADER
• PRO-BUSINESS ORIENTATION IS PRESENTED AS
THE ONLY SENSICAL APPROACH
POLITICAL & ECONOMIC
MANAGEMENT FRAMEWORK
• CONFUCIAN IDEOLOGY UNDERPINS THE GOVT’S
PATERNALISTIC AND COERCIVE MGMT:
– IDENTIFICATION OF SOCIALLY (UN)DESIRABLE VALUES,
– DEFINITIONS OF ETHNICITY & ETHNIC INTERRELATIONSHIPS,
– ENGLISH AS “LINGUA FRANCA,”
– ENFORCEMENT OF SUBSIDIZED PUBLIC HOUSING,
– COMPULSORY NATIONAL SERVICE,
– PROMOTION OF THE VALUE OF EDUCATION,
– COMPULSORY SAVINGS RATES,
– WORKPLACE & LABOR LAWS,
– SIGNIFICANT RESTRICTIONS ON PUBLIC & SOCIAL
CAMPAIGNS
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• GOVT LED APPROACH TO INDUSTRIAL
INFRASTRUCTURE:
– UNIQUE CHARACTERISTICS OF SINGAPORE’S
ENTREPRENEURIAL CULTURE
• SUCCESS OF PAP => REMARKABLE PER CAPITA INCOME
GROWTH
• RECENT DOWNTURN REVEALED 2 MAJOR FLAWS:
– UNHEALTHY RELIANCE ON ELECTRONICS,
– LACK OF ENTREPRENEURIAL CULTURE
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• GOVT LED APPROACH TO INDUSTRIAL
INFRASTRUCTURE:
– HISTORICAL DEVT. OF GOVT-LED COMPANIES (GLC)
• 20% OR MORE OWNED BY GOVT.
• NO SIGNIFICANT INDUSTRIAL/MANUFACTURING
STRUCTURE AT INDEPENDENCE
– SHORTAGE OF ENTREPRENEURS WITH CAPITAL,
INTEREST TO INDUSTRIALIZE SINGAPORE
– NEED FOR GOVT TO JUMPSTART INDUSTRIALIZATION,
OFTEN WITH FOREIGN JV PARTNERS
– 1974 CREATION OF TEMASEK HOLDINGS
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• STATE ENTREPRENEURSHIP:
– GLCs OPERATE A FULL- OR FOR-PROFIT ENTITIES
– MATCHES CONFUCIAN-BASED COLLECTIVE ENTREPRENEURIAL SPIRIT & HIGH WORK ETHIC VALUES
– PRIVATE ENTREPRENEURSHIP WAS DISCOURAGED
– “THE ROLE OF THE STATE IN BUSINESS HAS BECOME AT
BEST UNNECESSARY AND AT WORST DYSFUNCTIONAL”
– “THE SINGAPORE GOVT. HAS BEEN VERY EFFECTIVE IN
ERADICATING ENTREPRENEURS”
– GLCs MAKE UP 41% OF STRAITS TIMES INDEX
– POOR GLC RETURNS IN PAST DECADE
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• BARRIERS TO CREATIVITY:
– PERVASIVE INFLUENCE OF GLCs CROWDED OUT
PRIVATE INVESTMENT & HINDERED ENTREPRENEURS
– GLC EXECUTIVES ARE OFTEN RELATED TO SENIOR
GOVT. OFFICIALS OR FORMER GOVT. OFFICIALS AND SIT
ON SEVERAL BOARDS => MAINTAIN ATMOSPHERE
– SINCE 2002 GOVT. DIVESTMENT IN NON-STRATEGIC
INDUSTRIES
– HIRED FOREIGN MANAGERS, BUT THOSE SOON
RESIGNED … ARE OUTSIDERS SUITABLE FOR
SINGAPORE INC.?
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• RISK-AVERSE CORPORATE & COMMUNITY MGMT
CULTURE:
– PAP HAS PLAYED KEY ROLE IN SHAPING POLITICAL,
ECONOMIC & CULTURAL NATURE OF SINGAPORE
MANAGERIAL STYLE
– PAP ADOPTS ASSERTIVE & PATERNALISTIC STYLE
– ‘NANNYING” LEADERSHIP => SINGAPOREANS LOOK TO
GOVT FOR GUIDANCE
– SINGAPOREANS ARE RISK AVERSE => LOW
ENTREPRENEURIAL CULTURE, TOLERANCE FOR FAILURE
– 2 SECTORS CONTRIBUTE TO RISK-AVERSE CULTURE
• CPF
• EDUCATION SYSTEM
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• ROLE OF THE CENTRAL PROVIDENT FUND:
– HIGH SAVINGS RATE
– 20% FROM SALARY + 20% FROM EPLOYER
• TOWARDS RETIREMENT, HEALTHCARE, UNIVERSITY
EDUCATION, FINANCING OF HOME OWNERSHIP, ETC.
– REWARDS EMPLOYEES AND PENALIZES
ENTREPRENEURS
– POOL OF SAVINGS INVESTED OVERSEAS
THE MESO-SOCIETAL LEVEL: THE MGMT OF
SINGAPORE INSTITUTIONAL INFRASTRUCTURE
• THE EDUCATIONAL SYSTEM:
– PROMINENCE OF MATH & SCIENCE, CURRICULA
EMPHASIS THAT DISCOURAGES FREE THINKING &
INSTILLS FEAR OF FAILURE
– EMPHASIS ON SYLLABUS CONTENT, DETAILS, GOOD
GRADES THROUGH ROTE LEARNING
– CONTEMPORARY CONFUCIAN-BASED METHODS ARE
INAPPROPRIATE TO EARNING SKILLS FOR KNOWLEDGEBASED ECONOMY
– EDUCATION REFORM IS PRIORITY TO INCLUDE
CREATIVITY, BUT CAREFUL NOT TO BUILD INTELLECTUAL
INDEPENDENCE
– CULTURAL EMPHASIS ON SPIRIT OF COLLECTIVE
ENTREPRENEURSHIP & PROFESSIONAL OBEDIENCE
THE MICRO-ORGANIZATIONAL LEVEL: CRITICAL
TRADITIONAL, TRANSITIONAL &
TRANSFORMATIONAL ISSUES IN SINGAPORE MGMT
• 2001 DOWNTURN HAS EXPOSED SINGAPORE’S
WEAKNESSES
• GOVT. ACKOWLEDGES ITS NEED TO CHANGE TO
RESPOND TO 21st CENTURY CHANGES
• INVESTMENT IN INDUSTRY DIVERSIFICATION
• CHINESE SINGAPOREANS ARE INVESTING IN
CHINA
• FUTURE OF SINGAPORE GOVERNANCE & MGMT
STRATEGY IS CLOSELY TIED TO CHINA’S DEVT
• GOVT ELITE HAS WESTERN EDUCATION & ASIAN
ENTREPENEURIAL APPROACH
• NEED FOR & SLOW RESPONSE TO LIBERALIZATION
CONTEMPORARY MICRO-LEVEL APPROACHES FOR
MANAGING THE ENTREPRENEURIAL CULTURE OF
SINGAPORE
• GOVT RECOGNIZES NEED TO TRANSFORM
EDUCATION SYSTEM & “NANNY” STATE
MANAGERIAL APPROACH
• WITH THE PRESENCE OF MNCs, EXPOSURE TO
INTERNATIONALIZED MGMT SYSTEM => LOCALS
FACE FOREIGN MANAGERIAL VALUES &
PRACTICES => NEED TO CHANGE:
–
–
–
–
–
LEADERSHIP,
DECISION-MAKING,
COMMUNICATION STYLES,
MOTIVATION,
TEAM & INDIVIDUAL PROBLEM-SOLVING ABILITY