Ex-Civil Servants, Generals, Ministers are not Entrepreneurs
- Editors word;
The following letter was received following a recent Straits Times
article " "ENTREPRENEURSHIP; With naive bureaucrats, how can S'pore
win?" Straits Tijmes 8 Nov 2003.
Sammyboy.com's Alfresco Coffee Shop
From: KILL_BILL (BICKYBICKS) 13:08
17 Dec 2003
Dear Mr Goh Chok Tong
I would seriously urge you and your government to stop sending your
scholars, ex army generals, retired ministers or president scholars
as CEO or executive directors of government link companies and
The reason is obvious. They have FAILED to bring out the best for the
companies and statutory boards.
These companies and statutory boards need Entreprenuers.
Entreprenuers must come about because people are hungry-- hungry to
do big things - and have the courage to do it.
Your scholars, ex army generals, ministars or president scholars aren't hungry.
They have been properly and continuously fed by you since they were
18 years old, probably after their "A" Levels.
No doubt they can study. Most of them can become good administrators.
However, when they you put them in a company or statutory board
asking them to run it with profit, they just lacked the touch. The
reason is simple. They were never "hungry" before and they know they
will never be because they know that you will not abandon them as
they are scholars, retired generals or president scholars selected by
you in the first place.
Frankly speaking and without resorting to figures or statistics,
Singapore Technologies has failed because with the obscene amount of
money your government has pumped in, they should be the world's
richest and most profitable company by now if they are run by REAL
Instead, because of political or other "alignment" reasons, they have
been staffed by your scholars, ex-army generals and president
I am not saying that your scholars, ex-army generals, retired
ministers and president scholars are lousy or stupid. They are smart.
They can think. But they are not entreprenuers cos they never grew up
as one. They grew up as protected species knowing that life will be
comfortable because they have achieved good academic results in their
formative years. Their training and mindset are geared
towards "administration" and not "entrepreneurism".
Just compare Ho Kwon Ping of Banyan Tree and any of your statutory
board/GLCs CEOs or scholars. I am not saying that Mr Ho is a perfect
entreprenuer. I am saying that he is one who is hungry cos he knows
that if he fails, he will not get the opportunities of transferring
to another same paying job like your scholars or ex-army generals.
Similarly, Bill Gates know that had he failed, he will be earning
Then, there is a question of who is more successful with the
resources that were thrown at them. Who is a real entrepreneur? Think!
Do us a favour. Do Singapore a favour. Please...
Subject: ENTREPRENEURSHIP; With naive bureaucrats, how can S'pore
8 Nov 2003
GOVT'S ROLE IN ENTREPRENEURSHIP
With naive bureaucrats, how can S'pore win?
By Susan Long
A former army officer, Philip Anderson is today entrepreneurship
professor at Insead's Asian campus in Singapore. The American also
used to teach at Cornell University and Dartmouth College in the
United States. He minces no words as he talks to SUSAN LONG about the
naivety of Singapore bureaucrats and the futility of legislating
The biggest weakness of Singapore is bureaucracy, says Prof Anderson.
Many of those who regulate entrepreneurship here have absolutely no
experience in the private sector. They're honest, smart and
efficient, but they're naive. -- CHEW SENG KIM
WHAT do you see as the key strength and weakness of Singapore's model
of state-driven entrepreneurship?
The key strength is critical mass.
Hong Kong has an awful lot of 10-person companies that never get any
bigger. There's no company there as famous as Taiwanese personal
computer firm Acer that has the ability to drive demand and create an
ecology around it.
South Korea's world-scale chaebol are probably the best example of
critical mass. There's nothing that Samsung or LG cannot do because
of lack of resources. If they can't do it, it's due to some issue
other than size and wealth.
So Singapore's state-encouraged model has that great virtue. Instead
of having 75 little teeny players that nobody knows, Singapore has a
few big companies, like Singapore Technologies, which have the scale
to be truly well-known. If you go to Silicon Valley, people have
heard of Walden International and Vertex Venture Capital. They also
know Temasek Holdings.
But the biggest weakness is bureaucracy. Many of the people who
regulate entrepreneurship here have absolutely no experience in the
private sector. They're honest, smart and efficient, but they're
It's a simple naivety. They have no idea how to run private
enterprise and they're doing the best they can, without having that
kind of knowledge.
What troubles you most about such naivety?
There is a natural tendency for bureaucrats to be risk-averse. If
you're a bureaucrat and you have a choice between doing a risky thing
that might blow up in your face, but might really help entrepreneurs,
versus 'let's just follow the rules, tick by tick', any bureaucrat
worth his salt is going to pick the second choice.
Here in Singapore, you have many civil servants who have never been
anything but that. If you're a civil servant, your No. 1 job is to
support your minister. Fine and dandy, but it doesn't really help you
understand how to support entrepreneurs.
This problem of naivety comes about because the only way to learn how
to operate in the private sector is to just do it. The average civil
servant can listen but he hasn't been there, hasn't done it. And it's
just not a transferable experience.
Singapore ultimately will have to build a generation of civil
servants who have lived in that world and have that experience.
There's no way they can be smart enough to just see from the outside
what it's like to live in a world with no IM (instruction manual).
Taking all this into account, what meaningful role can the Government
play in proliferating enterprise? What is your response to all those
who wish it would mind its own business and lay off business?
Well, there is nobody either in the United States or Singapore who
believes in complete libertarianism - where the government does
The question is how much public sector involvement.
In the US, there's no question that the government, particularly in
its role as customer, has had a great deal to do with the success of
entrepreneurship. The reason why the US led the world in
semiconductors was because the US government was buying them.
The US likes to create an environment within which entrepreneurship
will flourish, then walk away and let that happen. The biggest
advantage it has is Nasdaq, no doubt about it.
However, I have never met a government that can pick winners. When
the US government tries to do things like subsidise venture capital
for small firms, it ends up losing a bunch of money. It's not any
smarter than anybody else.
So what should Singapore do with all its GLCs (government-linked
companies) and the increasingly loud charge that they are suffocating
If I were the Government, I would adopt a general policy that a GLC
makes sense only when the whole is worth more than the sum of its
For example, Singapore Technologies has some core and some non-core
businesses. Non-core doesn't mean unimportant. It means the synergy
isn't there and they are not drawing on enough common assets
leveraged across the entire infrastructure. Insead, for example,
doesn't own and run its own cafeteria. We're education people, we're
not lunch people.
But for political and emotional reasons, it has not been common for
Singapore Technologies or any other GLC to spin off viable parts of
Part of that, in my opinion, is because of the colonial legacy.
Singapore Technologies was built with the people's money and the idea
of selling off parts of your heritage to a bunch of foreigners seems
like going backwards.
But there is another solution. And this is what I'd urge the GLCs to
look at: Management buy-outs can create enormous value by giving
management a significant stake in the business and putting
management's feet to the fire.
The best buy-outs require people to mortgage their houses and take a
lot of personal risks and that's why they will work themselves extra
hard on behalf of the business.
What happens when you own a significant stake in your own business is
that you are directly responsive to signals from the market. It's
your profit, it's your pay cheque.
There is a very well-developed global industry for management buy-
outs. In North America, the US is clearly the world leader. In
Europe, Britain is extremely good at it.
But nobody in Asia is the financial king of the management buy-out
industry. So it could in fact become a specialty of Singapore.
What are some misfires you see in Singapore's bid to breed more
The best way to learn how to be an entrepreneur is to work at the
right hand of a successful one. At the end of the day, this is an
I think the Government here has a tendency to take bright scientists
and engineers and say: 'Okay, you guys have come out with this great
technology, how are you going to commercialise it?' There is the
implicit assumption that if you're the smart engineer, you ought to
be the company's CEO.
What I'd much rather see is a scheme where people with the potential
to be in growth ventures have the opportunity to work directly with
and be mentored by great entrepreneurs early in their careers.
Singapore needs to be training more CTOs (chief technical officers)
and CFOs (chief financial officers), not so much entrepreneurs. I
don't think you can train entrepreneurs.
But there is something that you can do that is very important.
It is very common to find people here who have been very successful
in large companies flounder in a start-up when they don't have the
big brand name on their card.
So you have to get people up to a level where they can hit the ground
running and contribute in their apprenticeship from Day One, instead
of spending the first four months on the entrepreneur's payroll,
asking: 'Gee, things are really different around here. How come this
doesn't look like DBS?'
What do you make of this whole creativity drive?
The Government is emphasising push over pull a little too much. I
open up The Straits Times and I see all these advertisements
declaring 'Come to my class, I'll make you 57 per cent more creative
in 90 days'.
But creativity is not the issue at all. I don't think that the
Taiwanese are more creative than Singaporeans although they have much
better results when it comes to entrepreneurship.
Get two guys to sit down at a hawker stall and brainstorm for half an
hour, and I guarantee they will come up with what looks like a good
idea. But that's not where great businesses come from.
Great entrepreneurship starts with understanding important problems
that have to be solved. To get a round of funding in the life
sciences, for example, involves signing an agreement with a big
pharmaceutical company worth at least US$1 million (S$1.75 million).
At the end of the day, it's not enough to say we've invented this
wonderful molecule or uncovered a hitherto unknown cancer mechanism.
What you have to know is: What are the 10 biggest problems that
Bristol-Myers Squibb is willing to write a cheque for today?
What are the three biggest headaches that Glaxo SmithKline would pay
somebody to take it off their hands? That's more important than sheer
I don't think most Singaporean entrepreneurs are connected enough to
the market to start with a problem worth solving. They tend to start
with either an idea or a template: Somebody else does such and such
and I could do that cheaper or better. They don't start by
saying: 'Wait a minute, here's a real problem.'
So the Government is spending too much effort promoting creativity
and not enough effort immersing people in what problems are worth
solving and what problems will people write a cheque to solve.
Give us an example how you would go about it.
Say the Government wants Singapore to be an education hub.
One way to do this is to mandate 15 other versions of Singapore
Management University (SMU) - which was a relative top-down success
in such a short period of time - in every conceivable sector from
fashion to the dramatic arts.
Another is to shortlist a dozen people, who have the ability to
inspire people and manage change, and put them on a year-long
programme to work side by side with someone overseas who is creating
a new education property.
The Singapore Government will subsidise it so that this entrepreneur
will be able to afford you. The only condition is that it has to be a
real job with a genuine mentoring relationship.
A year later, come back to Singapore, there is no obligation, but we
want to see what you do with your Olympic torch, now that it has been
Some may start something, others won't, but they will understand the
spirit. And this will do more to create an education island rather
than cloning SMU to the nth degree.
What else has to happen here first before Singapore's graduates will
consider entrepreneurship a respectable career choice - no less than
the professions or the civil service?
Entrepreneurship has to become socially prestigious here.
If you ask the average young Singaporean, 'If you want to grow up to
be a famous, important, fulfilled Singaporean, what's the best way to
do it?', the answer is still: 'Get the Government to send you to
Cambridge University, then Harvard Business School and bring you back
to become a civil servant.'
Singapore needs examples of very bright people who come back,
apprentice themselves to an entrepreneur, then start a company. By
the age of 32, while their classmates are busily rising in the civil
service, they're millionaires.
The great thing about young people is they don't necessarily go for
the big pay cheque. They take a long-term view and ask: 'How will
this experience build my human capital?'
In selling entrepreneurship as a career choice, we keep holding up
all these guys who, while studying at Nanyang Technological
University (NTU), invent a piece of software and make a lot of money.
I salute these guys, they are wonderful, but they're a true minority.
The average person needs to leave NTU, go work with a veteran
entrepreneur, learn how it's done, and years down the road, start his
You also need a great exit vehicle. You've got the beginnings of a
really good one with the Singapore stock market, which is honest,
fair and attractive.
But Singapore needs to own and operate the Nasdaq of the East.
When it does, you'll get entrepreneurship, not just from Singaporeans
but from people who come here because they want to be listed here.
If I were the Government, I would work my rear end off to ensure that
the Nasdaq of the East is located right here.
From time to time, Singapore vexes over the fact that its crop of
entrepreneurs are largely entrepreneurs of circumstance who resorted
to business only because they were Chinese-educated, without a degree
or devoid of other options. Do you see problems with such a
predominantly underdog profile?
First of all, it's not necessary to divert a lot of the very best to
What is most important is integrity, track record and connections,
not intelligence. There's a threshold. You're either smart enough or
you're not. Past that, an extra IQ point won't matter that much.
You need people who are very hardworking, passionate and obsessed
about solving a problem, as opposed to those who have proved they can
get 100 marks in an examination.
What matters is to say to Singaporeans: 'If entrepreneurship
interests you, there is a path for you to learn how to do this.'
All that the school does is get you to a level where you're worth an
entrepreneur's time. The entrepreneur finishes the job. But make that
proposition open to everybody and then let's see who's interested.
The only issue is that these underdogs have to be able to connect
socially to the overdogs.
For example, you get an astonishing number of entrepreneurs in the US
who come from not very prestigious universities but have a lot of
Harvard MBAs working for them.
Where you have a problem is when a guy graduates from the University
of Idaho and can't ever hire anybody who went to Stanford University
and has all those connections.
As long as you don't have a society where connected people only work
for other connected people, then let opportunity reign.
What is the best way to get rid of the Singaporean fear of failure?
The first thing to do is to reduce the genuine risk of failure. If
Vertex gave $10 million to some young NTU graduate and said, 'Go
build a great software company', unless this guy is a genius, he
probably will fail because he just doesn't have the experience.
So reduce the risk of failure by apprenticing young people to
entrepreneurs who can teach them how to do it so that execution risk
I think a lot of Singaporeans fear failure for good reason because,
without preparation, they really are going to fail.
The second thing is, it is a fact the Government sets the tone in
Singapore. If it said 'We want you to learn how to swim to Sentosa',
I assure you many Singaporeans would find a way to do it.
So what the Government needs to come up with is a set of safeguards
like a rational bankruptcy law and more supports which address market
failure and leverage the private market.
It needs to say to the people: 'We will ensure that you won't fail
because you ran out of cash because the banks were too risk-averse.'
It needs to signal to the banks that: 'We want innovation, we want
new products that are better than those out of New York or London, we
don't just want you to have a whole bunch of money.'
That probably also means redefining what failure is. Is business as
usual success or failure? If you redefine it as failure, you
say: 'I'm not satisfied as long as the world's most innovative
financial services run out of London.'
So the Government has to redefine what failure is, such that business
as usual is not good enough any more.
Date: Fri, 7 Nov 2003 11:08:54 +0000 (GMT)
From: apson lim
Subject: Call to lighten govt hand for innovation to thrive
Published November 6, 2003
Call to lighten govt hand for innovation to thrive
It may also help stem S'pore's brain drain: Gail
By SIOW LI SEN
(SINGAPORE) The government has to pull back from the
Singapore economy for innovation to flourish,
according to well-known economist Gail Fosler.
"Innovation really takes place where new, maybe even
bold and what I call non-conventional, ideas are
encouraged, and that is not the Singaporean way,
- Ms Fosler
Economically efficient allocation of capital and
labour is always more supportive of growth for
high-income countries, she said in a recent interview
Ms Fosler, who is chief economist of The Conference
Board and a director of DBS Group Holdings, said Japan
is a good example of a country in which a highly
regulated structure prevents resources from moving to
take advantage of economic opportunities. And because
of this, its economy is still extremely externally
As for Singapore, 'you're not going to get the new
business opportunities, you're not going to get small
businesses, the small medium enterprises to grow', she
'You're not going to get innovations. You're always
going to be waiting for people who've innovated in
other geographies to come to Singapore for some kind
Ms Fosler noted that Singapore is thinking
strategically and constructively about some of its
major industries. 'Still, you can imagine it can
become much more of a hotbed for innovation if you had
more of that reward structure,' she said.
'As long as government services are the most highly
rewarded, as long as government-linked enterprises are
not really taking risks in a globally competitive
sense, they will tend to underperform.'
Lightening the heavy hand of government may also stem
the loss of Singaporeans, according to Ms Fosler.
'Many Singaporeans studying abroad never come home,'
she said. The question is how to provide the kind of
economic opportunity that's going to bring expatriate
Singaporeans back to Singapore.
Singapore has a low tax regime and people can turn
labour income into capital, Ms Fosler noted. But
because of the regulatory structure, it is not so easy
to find ways to invest that capital other than in
financial and traditional pension-type investments.
'Innovation really takes place where new, maybe even
bold and what I call non-conventional, ideas are
encouraged, and that is not the Singaporean way,
right?' she asked.
On the volatility of the Singapore economy, she said
the shift towards services and being open and small
makes it seem that the Republic imports all the
problems of the region whenever something happens.
Previously, Singapore was able to combine a highly
educated work force with low wages, so it was a magnet
- and a relatively attractive magnet - in the region
for a tremendous amount of investment, she said.
But with the region having no net foreign investment
for years because it has migrated to China, the
economy has been left much more on its own. 'It's like
when your kids go out on their own,' she said.
Singapore has a significant service economy, but that
service economy has suffered extraordinary shocks. 'We
used to think all the shocks, economic shocks only
affected the industrial economy. Now we've got
economic shocks that affect the service economy,' Ms
According to her, Singapore's transition to a more
diversified economy - instead of just focusing on
technology - is still not deep or broad enough, but
the global recovery will allow some breathing space.
The Singapore economy now has all the benefits of this
wave of global growth, and a couple of years from now,
when the US slows down, it may be much more
diversified and much more stable, Ms Fosler said.
'I think the Singaporean model was sort of caught
off-guard, as it were, and it got very, very focused
on technology production as opposed to a much more
diversified economic model,' she said.