A42 | THE STRAITS TIMES | SATURDAY, FEBRUARY 25, 2017 |
FAST
SLOW
Arnoud De Meyer
For The Straits Times
My initial reaction to the recentlyreleased report from theCommittee for the FutureEconomy (CFE) was that it hadchosen to reinforce previouslydefined strategiesand objectives.
It talks about defending globalfree trade, investing in innovationand entrepreneurship, embracingthe digital economy, takingadvantage of Singapore’s image as aglobal and well-run city andinvesting in the reskilling of theworkforce. There was no silverbullet that could transformour economy.
While it did not sound thatexciting, it seemed logical, giventhe changes in the internationalenvironment in which we operate,and also given the maturity ofour economy.
But after more careful analysis,I have to say that this report isabout very ambitious objectives.
The CFE may be using the samewords like innovation,entrepreneurship, upskilling – butthe meaning is very different. Oneof the single most importantwords in the report is “deep”, as indeeper skills, deepertransformation, deep capabilities.
Deepening of what we havestarted in the past is perhaps themost difficult to accomplish,because it is all about
implementation. Developing a newsector or a new portfolio ofactivities as Singapore did in thepast, when it was catching up withother economies, is relativelystraightforward. Think of theintegrated resorts, Formula 1 races,becoming a hub for visual arts ormedical tourism – in each of thesecases there were successful rolemodels. And you could bring inforeign companies that were ableto develop such initiatives.
But the world and Singapore havechanged. I was a member of a similarcommittee in 2001 and I have to saythat the current committee faced abigger challenge.
We had our own problems in theearly 2000s. We had just come out ofthe Asian financial crisis. And wewere in the midst of the bursting ofthe tech bubble. But it was also aworld with consensus about whatneeded to be done – such as lessgovernment, more free trade,multilateralism, or stimulatingtechnopreneurship. The concept of“millennials” did not exist. Otherjobs like app developers or those inthe shared economy were unknown.
Today, the environment isdifferent. Many jobs that requiredstrong skills in industry have beenautomated. Machine learning istaking over clerical jobs. This is a farmore uncertain world. Developingstrategies for it is a tough challenge.
Singapore’s economy hasmatured and we now have verystrong sectors such as logistics andtransport, wealth management andfinance, advanced manufacturing,infocomms technology andtourism. We are world leaders inmany of these, and there is a realpartnership between industry andthe research laboratories at ouruniversities and the Agency forScience, Technology and Research.
Innovation is not a dream, but a
reality for many companies.Entrepreneurship has developedand incubators are full ofambitious start-ups.
Therefore I am not surprised thatthis report is about strengtheningand deepening what we alreadyhave. As a small country we alsoshould remain focused. We cannotbe a jack of all trades. Our future isnot about doing many new things,but to be much more innovative inwhat we already do well. We needto go into higher gear.
FIVE PROPOSALS THAT ARE KEYThe report is full of interesting ideas,but I favour five very crucial andextremely ambitious proposals.
Firstly, I am impressed by theidea of forming global innovationalliances. It sounds like a simpleidea to partner other universitiesand companies all over the world.
In practice, this will require hardwork. But think of it in this way: Weall admire, if not aspire, to be a newSilicon Valley. But what the CFEproposes can be a global virtualSilicon Valley. This idea was alsofleshed out in the recent Budget.
Singapore ManagementUniversity’s Institute forInnovation and Entrepreneurshipis building links with otherinstitutions in the United States,Belgium, Denmark, Indonesia,China, Vietnam and India to bringbudding entrepreneurs together.We keep it very lean and haveinformal structures because ourresources are limited.
But the ambition is to ensure thatour student entrepreneurs have theglobal networks to develop, financeand commercialise innovations.We are open to working withcompanies to give this approachmore muscle. Perhaps in a fewyears we will write case studiesabout Singapore at the heart of a
virtual Silicon Valley that coversthe world.
Secondly, I agree with the CFE –and the Budget statement thisweek – that one of our challenges isto scale up the myriad ofentrepreneurial ventures. I wouldhope to see tens of $100 millioncompanies, rather than one“unicorn” of a billion dollars. Why?Because a very large company willvery quickly leave our shores.Smaller successful companies willcreate more top-quality jobs inSingapore. To achieve this, we needto adapt the infrastructure toenable growth.
Third, Singapore is a verysuccessful city. Many countries andcities would like to learn from it.Remaining at the forefront ofmodern urban developmentrequires us to keep investing in thevibrancy and smooth organisationof the city. That will not be easy,because there is a risk that tensionsabout cultural, lifestyle, transportor housing choices will rise.
Being as diverse and vibrant as aLondon, Tokyo or New York and atthe same time remaining veryliveable and affordable has its ownchallenges. But when Singaporesucceeds in this, I am convincedthat foreign delegations will queueup at Changi Airport to learn. Witha bit of luck and wisdom, this caneasily be turned into a profitablebusiness. But this third ambitionrequires careful implementation.
Fourthly, I am a strong supporterof the Industry TransformationMaps (ITMs). Am I convinced thatthey will be equally effective acrossthe 23 sectors that have beenselected? I doubt it.
But I support the ambition tobring together all partners –multinational corporations, smalland medium-sized enterprises,universities and polytechnics, trade
associations, the Government andother relevant partners – and createa consensus to collaborate anddeliver growth and productivity foreach of these sectors.
It can be done. It happened inEurope after World War II and itled to the Golden Sixties and therecovery of Germany. It happenedin California in the 1950s and it ledto Silicon Valley. Singapore canpull this off, and if only half ofthese ITMs succeed, it wouldbe impressive.
Fifthly, I wholeheartedly supportthe commitment to free trade andinternational connectivity.Research consistently shows thatfree trade and globalisation have ledto more wealth for the world. Yes,there are problems with how thatwealth is distributed andconsequences for the gap betweenthe rich and the poor. Yes, there aregeographical changes in where andhow that wealth is created. But let’swork on these issues of distribution,rather than attack globalisation.
TWO BIG QUESTIONSON THESE AMBITIONSBut underlying all these are twobig questions: Do we have thepeople to achieve these ambitionsand do we have the right methodsfor implementation?
The first question is addressed bythe report: No, we don’t have them,but with sufficient investment ineducation and skills training we canget there.
I like the idea of deep skills. WhenI see Danish or Finnish design,northern Italian fashion, Germanmachinery, Swiss hospitality orwatches, Japanese cars or Frenchwine, I am often reminded thathaving a deep understanding of anindustry or a deep skill set gives youa great competitive advantage.
None of these examples are the
cheapest in the world, and all ofthem have strong competition. Butthey do add value to their countrybecause of their deep skills. What isSingapore’s deep skill set?
The second question aboutimplementation is left openin the report.
Yes, we trust that Singaporeansare good at implementation. But inthe past, it used quitestraightforward project planning,implementation and monitoringmethods. That was fine whenthe uncertainty quotient wasnot so high.
Recently I did some research onproject management under highuncertainty, and my co-authorsand I showed that implementingsuch projects requires a totallydifferent mindset and approach.
One needs to invest in quickexperimentation and consolidationof learning; launch many differentsmall projects at the same time; andbe able to cut losses quickly. Thereis also a need to be nimble andflexible and not be hung up onpredetermined plans, and tochallenge the hierarchy.
In this respect, the approachoutlined by Finance Minister HengSwee Keat in his Budget speech wasreassuring: “We will take a learningand adaptive approach, try newmethods, continue with themwhen they work well, cut losseswhen they do not, and draw onfeedback and experience to adjustand refine our plans. That is theSingapore way.”
I hope we will have thatnimbleness and flexibility inimplementing the ambitionsformulated by the CFE.
• The writer is president of SingaporeManagement University.
ByInvitation
The CFE ambition:Getting S’pore’seconomy intohigher gear
The past is anothercountry, one ofcatch-up. A deeperlook at the reportthrows up five boldproposals to take thenation toa higher level amid anuncertain future.
