P P 9 3 8 / 1 0 / 2 0 1 2 ( 0 3 1 4 0 2 )

V O L . 5 5 N O . 1 • 2 0 2 0

W e s t M a l a y s i a R M 1 5 . 0 0E a s t M a l a y s i a R M 1 7 . 0 0 w w w . m i m . o r g . m y

D I G I T A L

D I G I T A L

The Future of AsiaF E A T U R E

Leadership that Matters TodayL E A D E R S H I P S E R I E S

The Coronavirus Crisis: Are Leaders Ready?

O P I N I O N S

Redesigning for the Digital Economy:A Study of SMEs in Southeast Asia

Managing Conflict of Interestin a Business Enterprise

BUDGET 2020 MALAYSIA GETS IT (MOSTLY) ABOUT THE

DIGITAL ECONOMY

Contents

PUBLISHED BYMALAYSIAN INSTITUTE OF MANAGEMENT (MIM) Institut Pengurusan MalaysiaUnit T1-L16-1, Level 16, Tower 1, PJ 33, No. 3 Jalan Professor Khoo Kay Kim, Seksyen 13, 46200 Petaling Jaya, Selangor, Malaysia.

PUBLICATION COMMITTEEDato' Ng Tieh Chuan, EFMIM (Advisor) Sivanganam RajaretnanPoovanaswari Kasinathan

FOR ARTICLE SUBMISSIONS / ADVERTISING / SUBSCRIPTIONSPlease email us: management@mim.org.myTel: 03- 7711 2888

DESIGN & EDITORIAL SERVICES Paul & Marigold (DeCalais Sdn Bhd)No. 23A-6 Strata Office,KL Eco City, Lot 215,Pantai Baru, Jalan Bangsar,59200 Kuala LumpurTel: 603-2201 6499Email: arvind@paulandmarigold.comWebsite: www.paulandmarigold.com

PRINTED BYPrincomas Sdn Bhd (498036-P)No. 291 & 292, Jalan KIP 3,Taman Perindustrian KIP,Kepong, 52200 Kuala LumpurTel: 03-6277 1129 Fax: 03- 6276 2948Email: printcomas@yahoo.com

The authors automatically agree to indemnify MIM against any loss, costs, expenses (including legal fees), damages and liabilities that might arise from their own incapacity, negligence, breach of contract or other civil misdeeds. We reserve the right to edit all articles. Submit your articles to management@mim.org.my. All rights reserved. Copyright© 2019 by Malaysian Institute of Management. Advertisements in the MANAGEMENT do not constitute on the part of MIM a guarantee or endorsement of the quality or value of the advertised product or services of the claims made for them by the advertisers. No part of this publication may be reproduced in any form without prior written permission from the publisher. The views expressed in the articles are those of the authors and do not necessarily reflect the views of MIM. Both parties accept no responsibility for unsolicited manuscripts, photographs, illustrations and other editorial materials.

L E A D E R S H I P

06 The Coronavirus Crisis: Are Leaders Ready?

08 Leadership that Matters Today

T H E D E C A D E I N R E V I E W

15 The Decade in Review

D I G I T A L

26 Budget 2020: Malaysia Gets It (Mostly) About the Digital Economy

30 Redesigning for the Digital Economy: A Study of SMEs in Southeast Asia

F E A T U R E

38 The Future of Asia

O F F T H E B O O K S H E L F

46 2020 Must Reads

A P A G E I N H I S T O R Y

48 Beyond Performance-Based Training

O P I N I O N S

53 Managing Conflict of Interest in a Business Enterprise

R E M E B E R I N G I C O N S

57 MIM Court of Emeritus Fellows

M I M H I G H L I G H T S

60 YABhg Tun Daim Zainuddin Returns to the TAR Lecture Series

Sivanganam Rajaretnan

Chief Executive Officer

Malaysian Institute of Management

In accordance to date of admission

HONORARY FELLOWSYM Royal Professor Ungku Abdul Aziz Ungku Abdul HamidYAB Tun Dr. Mahathir MohamadYB Dato’ Seri Anwar IbrahimYABhg. Tun Abdullah Ahmad BadawiYB Dato’ Sri Mohd Najib Tun Abdul Razak

COURT OF EMERITUS FELLOWS

PresidentYABhg. Tun Haji Mohammed Hanif Omar

Vice PresidentYBhg. Dato’ Ng Tieh Chuan

YBhg. Datuk Dr. Paddy BowieYM Tunku Tan Sri Dato’ Seri Ahmad Tunku YahayaYBhg. Tan Sri Dato’ Azman HashimIr. George Lee Yau LungDr. Tarcisius Chin Nyet LeongMr. Robert Kuok Hock NienT.Y.T. Tun Pehin Sri (Dr) Haji Abdul Taib MahmudProf. Liew Shou KongYBM Tan Sri Tengku Razaleigh Tengku Mohamad HamzahYBhg. Prof. Tan Sri Dato’ Dr. Mohd Rashdan Haji BabaYBhg. Tan Sri Kamarul Ariffin Mohamed YassinYBhg. Tan Sri Osman S. CassimYBhg. Tan Sri Dato’ Sri (Dr) Sallehuddin MohamedYBhg. Tan Sri Wan Azmi Wan HamzahYBhg. Tan Sri Kishu TirathraiYBhg. Tan Sri Dato’ (Dr) R V NavaratnamMr. Niels John Madsen R, R1YBhg. Datuk Haji Mohd Saufi Haji AbdullahYABhg. Tun Dr. Ahmad Sarji Abdul HamidYABhg. Tun Musa HitamYBhg. Tan Sri Dato’ Sri Dr. Teh Hong PiowYBhg. Tan Sri Dato’ Dr. Lin See YanYBhg. Gen (Rtd.) Tan Sri Dato’ Seri Mohd Zahidi Haji ZainuddinYAM Tunku Tan Sri Imran Almarhum Tuanku Ja’afarYBhg. Tan Sri Dato’ Dr. Mohamed Munir Abdul MajidYBhg. Tan Sri Dato’ Sri Mohd Hassan MaricanYBhg. Tan Sri Dato’ Sri Tay Ah LekYBhg. Datuk Seri Haji Mohamed Iqbal RawtherYBhg. Tan Sri Datuk Yong Poh KonYBhg. Prof Datuk Seri Dr Haji Khairil Annas JusohYBhg. Tan Sri Dr. Ali HamsaYBhg. Tan Sri Dato’ Seri Siti Norma YaakobYBhg. Tan Sri Lim Kok ThayYBhg. Tan Sri Dr. Jeffrey Cheah Fook LingYBhg. Tan Sri Dato’ Seri Megat Najmuddin Megat KhasYBhg. Tan Sri Dato’ Lim Wee ChaiYBhg. Datuk Prakash Chandran

GENERAL COUNCILChairmanYBhg. Tan Sri Dato’ Seri Megat Najmuddin Megat Khas

Vice ChairmanPuan Rahima Beevi binti Mohamed Ibrahim

Representing Court of Emeritus FellowsYBhg. Dato’ Ng Tieh ChuanYBhg. Tan Sri Dato’ (Dr.) R. V. NavaratnamYBhg. Tan Sri Dato’ Seri Megat Najmuddin Megat Khas

Representing Corporate MembersPuan Rahima Beevi binti Mohamed IbrahimYBhg. Datin Dr. Hasnorliza Abu Hassan Mr. Thiagarajan a/l S. Rengasamy

Representing FellowsMr. Ong Weng Leong

Representing Associate FellowsMr. Azlan bin Abdullah

Representing Ordinary MembersMr. Rama Krishnan a/l ThiruyangadamMr. Selvaraja MuthayaMr. Sugumaran a/l VairavappillaiMr. Lim Eng Weng

Representing Associate MembersPuan Rosmawati binti Mohd Ali

CEO's Message

I t’s 2020! Let’s start the new decade with enthusiasm and renewed vigour. We ended 2019 momentously with the 29th Tunku Abdul Rahman Lecture Series which saw the honourable YABhg Tun Dr. Daim Zainuddin speak on the future of Malaysia.

This year promises to be another exciting year for the Institution, with a wide range of events and programmes in the pipeline. On the professional development front, we have introduced new programmes in line with the top 10 skills relevant to achieve the requirements of Industry 4.0. From leadership development programmes to Masterclasses and C-Suite Series, MIM works to curate our offerings to address current and emerging market needs. We kicked off the year with the 1st of our Emotional Intelligence programme series, ‘Leaders as Coach’, conducted by our partner, Genos International, Australia, which further accentuates our efforts in providing world-class executive education programmes.

March will see our signature Ready-To-Fly Youth Leadership Programme which is open to MIM Member’s children and Student Affiliates. Its sixth year running, the all-expense-paid experiential learning programme is designed to help youth develop a greater breadth of skills to meet the new demands of the workforce of tomorrow. Then, join us in April as we discuss governance and accountability at the MIM Crucial Conversations: Corporate Liability 2020.

On a solemn note, MIM also mourns the loss of two illustrious figures, the Late Chief Justice (Rtd.) Yong Pung How and Allahyarham Tan Sri Abdul Aziz Abdul Rahman, who were both our Court of Emeritus Fellows. They embodied the admirable qualities of a leader and led lives governed by honour and principles. A tribute to these icons is in the article ‘Remembering Icons’ on page 57.

As 2020 speeds full steam ahead, I would like to take the opportunity to thank you for your support in the past year. Our success is a reflection of your continued belief in our efforts as we strive to achieve greater accomplishments in the new year.

The Coronavirus Crisis: Are Leaders Ready?By Korn Ferry

Do leaders have enough supply-chain contingencies for a global epidemic?

L E A D E R S H I P

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

0 6

A s trade talks between the United States and China dragged on last year, organisations spent much of that time analysing their supply chains and making contingency plans to avoid any long-term disruption and mitigate business risk. But with the coronavirus outbreak, firms across the globe face a whole different level of challenges.

Experts say the critical difference is time—or lack of it. It’s been about three months since Chinese researchers first identified the deadly respiratory illness that has so far infected more than 75,500 people and claimed the lives of more than 2,000 people in 29 countries. “When something like this happens, it’s all about how quickly you can react,” says Kent Brown, North American practice leader for Korn Ferry’s Supply Chain Center of Expertise.

The speed and agility with which organisations react can be the difference between losing millions and tens of millions of dollars—particularly in a country like China, where every global company has some operations. Already, Apple, Starbucks, and Ikea have temporarily closed stores, while automakers have delayed production and airlines have canceled flights to the country. The closer operations are to the Wuhan/Hubei region where the virus originated, the deeper and more costly the impact, of course. "Most companies were not prepared for such a nationwide shutdown for this long," says Diana Chan, leader of Korn Ferry's Global Industrial Markets practice in Greater China.

Brad Marion, global leader of Korn Ferry’s Automotive practice, notes that automakers and suppliers strive to have a footprint and revenue mix that matches regional market share. With China now representing 30% of the world’s automotive market, that would mean most automakers would hope to have approximately 30% of their corporate revenues based in China, says Marion. “The impact the coronavirus will have on the Chinese economy is of great concern to many in the automotive industry,” he says.

The sudden halting of travel into and out of China also means leaders have limited opportunities to source alternative partners, says Mehrab Deboo, a senior client partner with Korn Ferry’s Global Supply Chain Center of Expertise. He says shipments will be delayed as organisations scramble to reroute or find alternate routes for

cargo. “The full affect of the virus won’t be known for months, but it is going to test the adaptability and nimbleness of supply chains for multiple global industries,” says Deboo.

That's why, says Brown, in times of sudden disruption, risk management becomes very important. “What kind of exposure does a company have, how close to the source is it located, when might the ban be lifted?” says Brown. “You have to figure out these logistical questions and manage from there.” From an inventory standpoint, identifying factories and warehouses that can take on additional capacity, accelerate production, or source components is critical. But that’s a luxury for some organisations—others are too small to have multiple warehouses or suppliers they can switch to in an emergency. As US-China trade issues flared up in 2018, many companies started expanding their manufacturing footprints to Vietnam, Thailand, and Malaysia, which helps mitigate certain risks, Chan says.

While some have drawn comparisons between the coronavirus outbreak and the SARS epidemic of 2002, there is one big difference for business operations: a lot more data analytics are available now. Leaders can track the coronavirus’s impact across a range of data points to better forecast risk and response for the next outbreak. In the absence of clairvoyance to predict the next major epidemic, “leaders can look at the numbers and put in algorithms to mitigate the effect,” says Brown.

For Article Submission-Advertisements-Subscriptions, please email us: management@mim.org.my

That's why, in times of sudden disruption, risk management becomes very important. – Kent Brown

L E A D E R S H I P

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

0 7

2 World’s First iPad Unveiled A device between a smartphone and a laptop, the iPad was Apple’s first tablet computer. It was launched by Steve Jobs at an Apple press conference in San Francisco. It's included applications were redesigned to take advantage of the larger screen with added functionality similar to their Mac OS X counterparts.

3 Google Leaves ChinaGoogle set up shop in China in 2006, offering a version of its services that conformed to the government’s oppressive censorship policies. It shut down its Chinese search engine in 2010, after it discovered a cyberattack from within the country that targeted it and dozens of other companies.

4 Instagram was LaunchedThe app itself only took 8 weeks to build but was a result of over a years work behind it. It was a success right from the beginning with over a million users only two months after it was launched. It went on to be bought by Facebook for USD1billion in 2012 and now has over 600 million active users.

5 BP Oil SpillKnown as the Deepwater Horizon Spill, more than 200 million gallons of crude oil was pumped into the Gulf of Mexico for a total of 87 days making it the largest maritime oil spill in history. It was caused by an explosion on the Deepwater Horizon oil

2 0 1 0

1 Malaysia Day Celebrated Throughout Malaysia for the First Time

Malaysia Day falls on 16th of September. Malaysia Day was initially only celebrated in Sabah and Sarawak, whereas it was a usual working day in Peninsular Malaysia. The then Prime Minister Najib Razak made Malaysia Day a nationwide public holiday in 2010 during a Q&A session at the Parliament on 19th October 2009.

The year 2020 has arrived, and with it the beginning of a new decade.

Here’s a look at stories that made headlines and scientific discoveries in the past 10 years in Malaysia and around the globe.

The Decade in Review

Deepwater Horizon offshore drilling unit on fire.Photo Credit: The Star

T H E D E C A D E I N R E V I E W

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

1 5

rig which caused the rig to subsequently sink.

6 BrahMos Missile CreatedIndia's BrahMos missile, jointly developed with Russia, set the world record for becoming the world's first and fastest supersonic cruise missile. The name BrahMos is a portmanteau formed from the names of two rivers, the Brahmaputra of India and the Moskva of Russia.

7 Haiti Struck by Devastating Earthquake

The deadliest natural disaster of the decade happened when

a 7.0 magnitude earthquake struck the West Indian island of Hispaniola. Followed by dozens of powerful aftershocks, the quake hit hardest in Haiti, the poorest country in the western hemisphere, killing an estimated 250,000 people and affecting some 3 million.

8 Creation of Synthetic LifeformIn a giant leap for biotechnology, a team of scientists led by DNA pioneer Dr Craig Venter successfully created the first artificial lifeform. Mycoplasma laboratorium is an entirely new species of bacterium, with

a man-made set of genetic code-originating on a computer and placed on a synthetic chromosome inside an empty cell. Using its new “software”, the cell can generate proteins and produce new cells.

9 Copiapó Mining AccidentThe Chielan mining accident saw 33 men become trapped for a staggering 69 days after the copper and gold mine in which they worked collapsed. The mine, opened in 1889, spiralled into the depths of a mountain and was approximately 2,625 feet deep.

region around a star where liquid water, a requirement for life on Earth, could persist.

4 Fukushima Nuclear DisasterFollowing a massive earthquake, a 15-meter tsunami disabled the power supply and cooling of three Fukushima Daiichi reactors, leading to a nuclear disaster in the country. The tremor of the 9.0-magnitude Tohoku earthquake and subsequent tsunami killed over 15,000 people and displaced hundreds of thousands of people.

5 Steve Jobs DiesSteven Paul Jobs was an American inventor, designer and entrepreneur who was the co-founder, chief executive and

2 0 1 1

1 Malaysia’s New Currency Series launched

The latest series of Malaysian banknotes drew its inspiration from the distinctive features of Malaysia, incorporating elements of the country's natural treasures, culture and heritage. Themed 'Distinctively Malaysia', the banknotes features traditional expressions in the art and craft, natural wonders, flora and fauna and the economy. The banknotes issued were in the denominations of RM1, RM5, RM10, RM20, RM50 and RM100.

2 Osama bin Laden killedOn May 2nd 2011, U.S. Special Forces raided an al-Qaeda compound in Abbottabad, Pakistan, and killed the world’s most wanted terrorist: Osama bin Laden. The entire operation, which lasted only 40 minutes from start to finish, was the culmination of years of calculated planning and training.

3 Scientists discover Kepler-22b An extrasolar planet orbiting within the Goldilocks zone or habitable zone of the Sun-like star Kepler-22. The planet is nearly 2.5 times the size of Earth and has a 290-day year. It is the first planet that NASA's Kepler mission has confirmed to orbit in a star's habitable zone - the

T H E D E C A D E I N R E V I E W

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

1 6

chairman of Apple Computer. Under Jobs' guidance, the company pioneered a series of revolutionary technologies, including the iPhone and iPad. Jobs died following a long battle with pancreatic cancer.

6 Greek Debt CrisisThe Greek debt crisis was the dangerous amount of sovereign debt Greece owed the European Union between 2008 and 2018. In 2010, Greece said it might default on its debt, threatening the viability of the eurozone itself. To avoid default, the EU loaned Greece enough to continue making payments. It was the biggest financial rescue of a bankrupt country in history.

7 World’s First Synthetic Organ Transplant

Surgeons carried out the world's first transplant of a fully synthetic organ, a windpipe created using the patient's own stem cells and a fully artificial scaffold. The operation was performed on a

36-year-old cancer patient at the Karolinska University Hospital in Stockholm, Sweden.

8 Completion of the International Space Station

This was by far the largest man-made structure ever put into orbit – measuring 110m wide, with a mass of 345,000 kg and a living volume of 1000 cubic metres. The primary fields of research on board the station include human research, space medicine, life sciences, physical sciences, astronomy and meteorology. It will remain in operation until the early 2020s.

9 22 Nanometer Chips are in Mass Production

The successor to 32nm, this latest generation of chips continued the trend of Moore’s Law, each containing more than 2.9 billion transistors. They will, in turn, were succeeded by 16nm chips – close to the limits of miniaturisation for integrated circuits.

2 0 1 2

1 First Female Malaysian to Win Medal at the Olympics

Malaysian diver, Pandelela Rinong was the first female Malaysian athlete to win a medal at the Olympics, as well as the first to win an Olympic medal in any sport other than badminton. She won the bronze medal in the 10-metre diving platform at the 2012 Summer Olympics in London, United Kingdom.

2 Gangnam Style’ Breaks YouTube

Gangnam Style takes the world by storm and became the first video ever to reach a billion views on YouTube. The music video for South Korean singer Psy's Gangnam Style exceeded YouTube's view limit, prompting the site to upgrade its counter.

3 Neil Armstrong DiesUS Astronaut, who made the “giant leap for mankind” as the first person to walk on the Moon, died at 82, due to complications resulting from cardiovascular procedures. A quiet, private man, at heart an engineer and crack test pilot, Mr. Armstrong made history on July 20th 1969, as the commander of the Apollo 11 spacecraft on the mission that culminated the Soviet-American space race in the 1960s.

UCL professor Alex Seifalian holds the trachea that was used in the first synthetic organ transplant.Photo Credit: Rex Shutterstock/ The Guardian

T H E D E C A D E I N R E V I E W

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

1 7

2 0 1 4

1 MH370 DisappearsMH370 disappeared with 239 passengers and crews, becoming one of the biggest aviation mysteries until today. The Malaysia Airlines jet had taken off from Kuala Lumpur on a routine flight to Beijing. After some fictitious reports that the Boeing 777 had landed in southern China with technical problems, MH370 was declared missing and presumed to have crashed in the South China Sea. Despite many clues and theories regarding MH370’s disappearance, the truth behind its disappearance is still yet to be discovered.

2 MH17 Shot Down Over UkraineMalaysia Airlines Flight 17 (MH17) shot down by a surface-

to-air missile over Ukraine pro-Russian separatists. The passenger flight was en route from Amsterdam to Kuala Lumpur. A Dutch-led international team of investigators has charged four suspects, three Russians and a Ukrainian, with the murder of all 298 people aboard. They will go on trial in absentia in a Dutch court in March 2020.

3 Facebook Buys WhatsAppIn a play to dominate messaging on phones and the Web, Facebook acquired WhatsApp for $19 billion. WhatsApp has upwards of 450 million users, and it is adding an additional million users every day. It has been able to hold its weight against messaging heavyweights like Twitter, Google and Microsoft's Skype.

4 One World Trade Center Completed

One World Trade Center (also known as One WTC or Freedom Tower) is the main building of the rebuilt World Trade Center complex in Lower Manhattan, New York City. One WTC is the tallest building in the United States, the tallest building

in the Western Hemisphere, and the seventh-tallest in the world. It sits on the World Trade Centre site, which is being built to replace the original seven buildings that were destroyed in the September 11th terrorist attacks.

5 Tigers are Going ExtinctThe 20th century saw tiger numbers plunge by over 95% worldwide. By the 1970s, they had disappeared from Central Asia, by the 1980s from Java and by the 1990s from South China. Three of the nine subspecies – Bali, Javan and Caspian tigers – were extinct by the 1980s. Poaching remains a serious problem, with tiger skins fetching up to USD20,000 in China.

2 0 1 5

1 Sabah EarthquakeSabah earthquake struck Ranau, Sabah, Malaysia with a moment magnitude of 6.0 on 5th June, which lasted for 30 seconds. The earthquake was the strongest to affect Malaysia since the 1976 Sabah earthquake. Malaysian authorities believed there was as many as 19 people killed, most caught in the landslide triggered by the quake.

Most tigers are now found in captivity, such as this majestic beast at the Korkeasaari Zoo in Helsinki, Finland.Photo by: Max van den Oetelaar on Unsplash

A woman writes a message on a banner for missing Malaysian Airline Flight 370 at Kuala Lumpur International Airport in 2014.Photo by: Charles Pertwee/Bloomberg

T H E D E C A D E I N R E V I E W

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

1 9

reform labour laws, among other measures.

5 Zika Virus EpidemicZika virus is a mosquito-borne flavivirus that was first identified in Uganda in 1947 in monkeys. In early 2015, a widespread epidemic of Zika fever, caused by the Zika virus in Brazil, spread to other parts of South and North America. It also affected several islands in the Pacific, and Southeast Asia. The virus can be transmitted from an infected pregnant woman to her foetus, then can cause microcephaly and other severe brain anomalies in the infant.

6 The First Climate Change Refugees

As a direct result of sea level rises, the inhabitants of the Carteret Islands in Papua New Guinea had been forced to abandon their homelands. Crops, trees and wells had been contaminated by seawater, while most of the buildings on the islands were destroyed. The melting of polar ice sheets and glaciers, together with thermal

2 IMDB Scandal1Malaysia Development Berhad (1MDB) is an insolvent Malaysian strategic development company, wholly owned by the Minister of Finance (Incorporated). In 2015, The Wall Street Journal released a report alleging Malaysia's then-Prime Minister Najib Razak of channelling over RM 2.67 billion (≈ US$ 700 million) from 1MDB to his personal bank accounts, making it the world’s biggest financial scandal.

3 Nepal EarthquakeNepal was devastated by a massive 7.8 earthquake, killing nearly 9,000 people, injuring 22,000 and leaving 3.5 million people homeless. It was the worst natural disaster to strike Nepal since the 1934 Nepal–Bihar earthquake. The earthquake triggered an avalanche on Mount Everest, killing 21 making 25th April 2015 the deadliest day on the mountain in history.

4 Greece Bailout ExpiresThe Greek government missed its 1.6 billion euro ($1.7 billion) payment to the IMF when its bailout expired on June 30th making it the first developed country to effectively default to the Fund. However, a third bailout was approved from the EU. In exchange for the 86 billion euro bailout, which is to be distributed through 2018, EU creditors required Greece to implement tax reforms, cut public spending, privatize state assets, and

expansion, could raise the level of Earth’s oceans nearly 2m by 2100 – potentially displacing hundreds of millions of people.

7 Lee Kuan Yew DiesFounding Prime Minister of Singapore, Lee Kuan Yew died ages 91. His death was four months shy of the 50th anniversary of Singapore’s independence. Mr Lee was widely regarded as the man most instrumental in shaping Singapore, from the time he and his People's Action Party colleagues pushed for self-government in the 1950s, to their quest for merger with Malaysia in the early 1960s, and their efforts to secure the country's survival after independence was thrust on it on Aug 9th 1965.

Rescue workers take part in the rescue operation where several houses have collapsed at Vhaktapur district in Nepal 27 April 2015.Photo by: The New York Avenue Presbyterian Church

Lee Kuan Yew Dies.Photo by: The New Republic

T H E D E C A D E I N R E V I E W

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

2 0

T he Malaysian government clearly gets it that the nation needs to prepare well, and prepare fast, in order to be a winner in the digital economy, that is already upon us. It has made “boosting economic growth in the New Economy and Digital Era” as the first pillar of its 2020 Budget that was introduced by Lim Guan Eng, Malaysia’s Minister of Finance.

With the Digital Economy being all about workers upskilling themselves to be ready for future jobs, the second pillar of investing in talent is especially crucial. Here I really like the TVET focus carved out. For example, the strengthening of Technical and Vocational Education and Training (TVET) with an allocation of RM5.9 billion to ensure the pipeline of skilled and semi-skilled workers will remain robust.

Budget 2020: Malaysia Gets It (Mostly) About the Digital EconomyBy Digtal News Asia

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

2 6

public funds for maximum impact, the RM50 million should be matched by the same amount from the telco hardware and software players chipping in together. I am talking about the likes of Nokia, Ericsson, ZTE, Huawei, even Samsung, some of the Japanese network players, the Softbank owned British chip designer ARM Holdings and of course the American chip makers like Intel, Broadcom, Texas Instruments etc. Whoever has an interest in wanting to do business in Malaysia’s 5G market.

A RM100 million a year grant for at least four years? Now we’re talking and giving our tech entrepreneurs and companies a chance to think bigger than just fighting over a small RM50 million sum.

And if the government grant is not coming from the MCMC, and I would be surprised if it is not, then our telco operators must contribute as well to the matching amount.

Of course, if the Axiata Group-Telenor merger had gone ahead,

the global innovation centre they would have established in KL would have become the fertile ground from which possible Malaysian tech innovators in 5G could have arisen.

By the way, this standalone RM50 million grant is surprising when considering the RM25 million matching grant announced to spur pilot projects around applications such as drones, autonomous driving, blockchain and based on fibre and 5G. Why the different approach for much tougher technology development challenge?

Now for the head scratching, logic defying example, we have the RM70 million allocated to build 14 one-stop Digital Enhancement Centres in all states to facilitate access to financing and capacity-building for businesses, especially small and medium-sized enterprises (SMEs).

The funding will be allocated to Malaysia Digital Economy Corporation (MDEC) to set up these centres. Here come the head scratching moment. Lim says that the initiative is an extension of the 100 Go Digital programme.

Now if you know what this programme is, then you need to take over running DNA from me. Because in my seven years of running DNA, we have not carried a single article on this programme. Neither can I find anything about it online as well, though Singapore has something called SME Go Digital.

At the same time, there is an allocation of RM11 million, (a relatively small amount) to the Ministry of Energy, Science, Technology, Environment and Climate Change (MESTECC) to encourage the uptake of STEM education.

[RM1 = US$0.24]Still, if you were to look at some of the specific incentives introduced to support the Digital Economy for 2020, your jaw may drop at the small amounts given to support this acceleration to becoming a digital powerhouse nation and some of the incentives may induce bouts of head scratching as well as to questioning the logic behind them.

To the jaw dropping example, we have the 5G Ecosystem Development Grant worth RM50 million that the government hopes will “significantly enhance Malaysia’s economic competitiveness” through seeding technological developments by Malaysian companies to ride the global 5G wave. Lim’s specific remark here was, “The government wants Malaysians to be prepared for the coming 5G era.”

I’m sorry but RM50 million won’t move the needle to achieve the great things hoped for here. Although it is not mentioned where the money will come from, I suspect it will be contributed by the Malaysian Communications and Multimedia Commission or MCMC.

With Finance Minister Lim always talking about stretching

The government wants Malaysians to be prepared for the coming 5G era.

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

2 7

[Ed note: MDEC has since pointed out to me that this is a very new program].

That mystery aside, and taking the word “build”, literally, it defies logic that we need to actually build 14 centres, one in each state, likely in the capital as that is where the majority of SMEs are located.

It would be a total waste of money to do so. I say just use an existing government facility and channel the full RM70 million to the purpose of capacity building for our SMEs. Actually, I wouldn’t be surprised if the government came out to clarify that this will not entail actually building 14 facilities.

Lim also spoke of establishing, not building – though it could mean the same thing – three new digital libraries in Kedah, Perak and Johor to spur “knowledge-sharing and education through digital-enabled content."

Again, I am sure, Minister of Communication and Multimedia, Gobind Singh Deo, will have enough resources on the ground in each of these states, to offer one of his ministry’s facilities for this purpose. Waste not a cent on any pointless construction here as that will not help the government achieve its goal of pushing the nation towards digital transformation.

These two particular grants aside, there is a lot I like about the various digital initiatives announced.

For example the RM20 million for MDEC to further grow digital content champions

in the e-Games, animation and digital arts space. This support no doubt serves as validation to the impressive work being done by the outstanding Hasnul Hadi Shamsudin who leads MDEC’s creative content efforts.

Digitalisation Boost for SMEsMoving away from MDEC to our SMEs, the 50% matching grant amounting to RM5,000 each should give some incentive for SMEs to digitise their operations. In this case the grant is specifically for ERP, e-POS and e-payroll services. A subtle criteria of this grant is that it actually refers to cloud based services as it uses the term “subscription services” which is the standard business model for cloud computing based services.

What I especially like here is the generous support and the cut-off point in helping SMEs. The matching grant is to be made available over a five-year period but will be limited to the first 100,000 SMEs owners quick enough to apply to take advantage of the benefit.

And while the RM5,000 amount may not seem incentive

enough for an SME owner to take advantage of it, Effon Khoo, who runs SaaS payroll and HR services for SMEs, contends that it is enough for a full year of service for any SME that has 20 staff and below.

“RM10,000 in general, is good enough for a 20 pax size SME to get HR, accounting, POS, webstore cloud subscription sorted out. And it improves the business operations a lot,” he says.

As someone who deals with traditional SMEs, daily, Khoo has noticed how a slow adoption of productivity tools has hurt businesses. “Sometime it's just a needle to move the company to improve operations. You will be surprised that there are so many companies still running operations the old way, for example using paper to apply for leave. Many still struggle to pay payroll online,” he notes.

Nonetheless he sees his clients being more receptive now with this incentive. Joel Neoh, cofounder of Fave is also excited about this incentive, adding, “we want to see how we can potentially work with the

Moving away from MDEC to our SMEs, the 50% matching grant amounting to RM5,000 each should give some incentive for SMEs to digitise their operations.

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

2 8

By EY

Redesigning for the Digital Economy: A Study of SMEs in Southeast Asia

C o n t i n u a t i o n f r o m M A N A G E M E N T V O L . 5 4 N O . 3 ( F e a t u r e )

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

3 0

Internet of Things (IoT) on Governments’ Digital Agenda

I oT is the connection of devices to the Internet using embedded software and sensors to communicate, collect and exchange data (such as their identity, condition and environment) with one another. Country-level analysis indicate that IoT also ranks high on the digital agenda, particularly so for the SMEs in Indonesia, Malaysia and Singapore.

This could be attributed to governments in these countries demonstrating the potential of IoT with public projects, fostering the awareness of its benefits to businesses, and supporting funding and expertise to accelerate the progression of IoT in the digital economy.

Indonesia:

Figure 11: Government-led IoT projects

Multiple initiatives are underway as part of Indonesia’s economic masterplan to become Southeast Asia’s largest digital economy (through its “2020 Go Digital Vision” program) and have the digital economy contribute US$130b to its economy in 2020. These include the Ministry of Communication and Information Technology (MCIT) launching “Industry 4.0: Making Indonesia 4.0” in April 2018. Industry 4.0 refers to five industrial digital technologies: IoT, AI, human-machine interface, robot and sensor technology, and 3D printing. The initial prime beneficiaries are expected to be from food and beverage, automotive, electronics, chemicals, textile and garment industries. The government is aggressively pushing its smart city initiatives as part of Industry 4.0. Under its “Movement to 100 Smart City” plan, Indonesia is using IoT to develop smart cities in Jakarta, and has installed about 400m sensor devices across the country as part of the pilot phase to achieve “smart connectivity, smart solutions and smart user.”9, 10

Malaysia:

The “National Policy on Industry 4.0” launched in October 2018 encourages the adoption of Industry 4.0 technologies including IoT. Sectors in focus include the digitization of manufacturing processes in the electrical and electronics, machinery and equipment, chemical, medical devices and aerospace industries.Since the introduction of “Smart Cities Initiatives” as part of its 11th Malaysia Plan (2016-2020), the country is deploying an intelligent IoT network in populated cities to test out urban management solutions in optimising cities infrastructure and connectivity and enhancing the livability for citizens. It is also set to adopt 5G technology in the near future — plans are afoot to develop a holistic strategy for 5G deployment in areas such as health care, media and entertainment, automotive, manufacturing, public safety, agriculture and education.11, 12

Singapore:

Singapore seeks to position itself as the epicenter for IoT technology in Southeast Asia, with infrastructures being laid out as part of its “Smart Nation initiative” to support IoT deployments in the public and private sectors. This includes rollout of its Narrowband IoT (NB-IoT) network in 2017, the first of its kind in Southeast Asia. Interconnectivity among physical objects from this nationwide NB-IoT network supports applications such as flood monitoring, fleet management, and waste management, and enables businesses and consumers to track their energy consumption.By 2020, at least two 5G networks would also be rolled out to enable the next-frontier commercial applications such as driverless cars and virtual reality content streaming services.Various other plans to catalyse Singapore’s progress toward a digital society include equipping the workforce with data science and future skills, helping SMEs build stronger digital capabilities, and facilitating the development of a cashless society.13, 14, 15

The core idea is not to utilise new technology to merely replicate an existing product, service or solution in a digital form, but ideally, to enhance these offerings to support superior customer engagements and potentially new sources of income.

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

3 1

Challenges with TransformationDigital transformation creates significant opportunities for the SMEs but is a difficult proposition to deliver on, with organisational commitment not necessarily translating to successful application. The core idea is not to utilise new technology to merely replicate an existing product, service or solution in a digital form, but ideally, to enhance these offerings to support superior customer engagements and potentially new sources of income.

Respondents face these core challenges in implementing an effective digital strategy.

Procuring or upskilling talentIt appears that digital transformation is as much a cultural as a technological endeavor. Among the top five hindrances are the lack of access to digital experts (64.7%) and difficulties for existing staff to reskill and transition toward a digital-first culture (62.5%).

One of the toughest challenges is securing qualified digital talent like data scientists and social marketers. Individuals with the relevant skillsets are scarce, particularly more so in the emerging markets in Southeast Asia as digitalisation outpaces the supply of human resources that can deliver on it. This issue extends beyond just needing to invest to procure digital talent but to appropriately align resources with digital strategies, and to foster a corporate culture that embraces

Figure 12: Issues impacting digital successes

64.7%Lack of access to digital talent

64.9%Pressure to focus on immediate, instead of longer-term benefits

IT limitations from legacy architectures

Need to balance innovation with digital security

Not knowing which new technology to implement

On a scale of 1 (not challenging) to 5 (very challenging), percentage of respondents ranking the impact of these issues on digital strategy as a 4 or 5.

Difficulty in measuring digital successes

Challenges in up- or reskilling existing staff

Stalled transformation after an initial period of progress

Regulatory restrictions or scrutiny

64.7%

64.4%

64.4%

62.5%

60.9%

60.9%

59.5%

56.8%

Limited benefits as these technologies are not adopted industry-wide or across borders

55.2%

Uncertainty around how to align digital with the broader strategy

58.2%

constant experimentation and learning.

Correspondingly, the need to reskill and transition existing staff toward a digital-first mindset is important. This is a pressing concern with research

suggesting that about 43% of IT executives across the ASEAN markets do not have the necessary talent to build digital solutions.16

This lack of new digital talent can be seen in markets such as

D I G I T A L

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

3 2

The Future of AsiaBy McKinsey Global Institute

Asian flows and networks are defining the next phase of globalisation

A sia is the world’s largest regional economy, and its power is expected to grow as its constituent economies integrate more deeply with one another in trade, innovation, and culture and people flows. Asia will fuel and shape the next phase of globalisation in what can justifiably be called the Asian Century.

Asia is increasingly becoming the world’s center. Between 2000 and 2017, its share of global real GDP in purchasing-power-parity terms rose from 32 to 42 percent; its share of global consumption from 23 to 28 percent; and its share of the world’s middle classes from 23 to 40 percent. By 2040, those three measures of scale are expected to

F E A T U R E

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

3 8

increase further to 52, 39, and 54 percent, respectively. Although Asia faces challenges such as growing risks in financial systems, inequality, and pressure on the environment, Asia’s medium-to long-term growth outlook appears robust.

Global flows are shifting toward Asia on seven of eight dimensions—trade, capital, people, knowledge, transport, culture, resources, and the environment. The only flow that has declined is waste (environment). From 2007 to 2017, Asia’s share of global goods trade rose from 27 to 33 percent, of global capital flows from 13 to 23 percent, of worldwide patents from 52 to 65 percent (although its share of IP charges has remained constant at around 25 percent), and of global container-shipping traffic from 59 to 62 percent.

Asia is becoming more Asian as intraregional flows expand—moving within the region are 60 percent of goods traded by Asian economies, 59 percent of foreign direct investment, 74 percent of Asian air travelers, and 71 percent of Asian investment in startups.

Asia is diverse but complementary. Based on scale, economic development, interaction within Asia, and connectedness with the world, we distinguished four Asias among many: (1) Advanced Asia provides significant capital and technology to its neighbors;

(2) China, large and distinct enough to stand on its own, acts as a regional anchor and a connectivity and innovation platform; (3) Emerging Asia provides labor and long-term market growth potential, and is culturally diverse; and (4) Frontier Asia and India accesses a broad base of trade partners and investors, and provides growth opportunities. The complementary nature of these groups can make Asia more prosperous and resilient.

The integration and intraregional flows across different Asias are creating powerful networks, with new urban hubs and spokes emerging rapidly. We highlight three major networks. First, an “industrialisation” network is developing with rising consumption, maturing domestic value chains, and uncertainties

in global trade leading to the formation of Asia-for-Asia supply chains. Second, Asian networks of capital, ideas, and technologies are forming powerful “innovation” hubs, enabling the leapfrogging of Asian countries through a multilocal innovation network. Third, “culture and mobility” networks are developing as Asian scale and people flows can create the next global entertainment blockbuster and stimulate large value creation opportunities in adjacent areas such as tourism. These Asian networks can turn “unknown” cities into new hubs that companies can consider as destinations for future investment.

Although Asia still faces risks and challenges, decision makers need to be prepared to win in the Asian Century. They need to be relevant to Asia by joining Asian flows and networks and offer what Asia needs; protect from and prepare for risks by responding to environmental challenges, filling skills gaps, and enhancing institutional capabilities; rethink the Asian operating model to unlock opportunities from complementary characteristics of the multiple Asias; and forge a stronger framework for intraregional collaboration, including, for instance, an effective mechanism for resolving disputes and facilitating more flows beyond trade.

Asia will fuel and shape the next phase of globalisation in what can justifiably be called the Asian Century.

F E A T U R E

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

3 9

IndustrialisationAsia-for-Asia supply chains are emerging due to rising consumption and maturing domestic value chains

InnovationAsian capital, ideas, and technologies are enabling leapfrogging to multi-local innovation across the region

Culture and mobilityAsia is a growing hub for people flows and a rising cultural force

Asian Flows and Networks: Redefining GlobalisationAsia is becoming bigger and more integrated

Asia is diverse, but also complementary

Asia’s integration is producing three powerful regional networks

Bigger Share of global flows

More integratedIntraregional share of total flows, %

Trade (goods)

60

27 33

Capital (FDI)

59

1226

People (travelers)

74

33 40

Knowledge (patents)

71

5265

Transport (cargo)

55

58 64

Concentration

Category

Innovation

Labor

Market

Capital

Culture diversity

Metric

Patents, 2017 Thousand

Growth in working-age population, 2017–40 Million

GDP growth, 2017–40 CAGR, %

Net FDI outflow, 2013–17$ million

Number of different official languages

Advance Asia

569

-20

1.1

378

7

China

1,395

-132

4.4

73

2

Frontier Asia and India

50

332

5.7

-218

14

Emerging Asia

33

80

4.7

-153

13Advanced AsiaChinaEmerging AsiaFrontier Asia and India

F E A T U R E

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

4 0

Lynas Malaysia is the largest and most modern Rare Earths plant in the world, designed on best practice sustainability principles, supporting Malaysia’s Industry 4.0 vision and economic development and is a centre for rare earths excellence.

As the world’s second largest producer of Rare Earths and the only significant outside China supplier, Lynas is uniquely positioned Rare Earth materials are essential for today’s automotive, electronics & appliances, automation, wind turbines and oil & gas industries as well as eco-friendly technologies like electric vehicles.

In 2019 Lynas Corporation Ltd became a signatory to the United Nations Global Compact (UNGC), released its first Sustainability Report and was awarded a Gold medal CSR rating for Lynas Malaysia’s performance across the environment, labour and human rights, ethics and sustainable procurement. Ranking Lynas Malaysia among the top 5% of organisations evaluated.

As part of its Sustainability Report, key areas were identified as ongoing areas of focus for the Lynas to continue to drive sustainable value creation. These include health and safety, communities and human rights, employment, environment and emissions, waste and effluents.

• Health and safety: The health and safety of our workforce and our communities is the first priority for Lynas. We focus on eliminating fatalities, life-changing injuries and occupational illnesses from our business, while reducing all workplace injuries and health impacts. At the same time, our high standards of safety and environmental management are focused on ensuring our operations are safe for our communities and the environment.

• Communites and Human Rights: We recognize the importance of supporting the communities in which we work and live and make it a priority to take an active role in making these communities better. We aim to make a positive contribution to local employment, skills, education, health and the environment. We also support disadvantaged groups including the elderly, disabled and women and girls.

• Employment: The integrity, creativity, dedication, diversity and drive of our employees allows us to excel. We empower our people to achieve their personal best and we respect our people and their individuality. Lynas is commited to promoting a workplace culture that embraces diversity of thought as well as diversity of ethnicity, culture, background, gender and age.

• Environment and Emissions, Wastes and Effluents: Lynas proactively works to reduce our greenhouse gas emissions, conserve resources and energy, prevent contamination of the air, water and soil, and limit waste generation. We develop and produce environmentally responsible products and

we encourage reuse and recycling and engage in activities and develop technologies that help conserve the natural environment. In these ways, Lynas strives to reduce our environmental burden at every level of our business activities.

In addition to these areas of focus, Lynas engages with stakeholders in many ways on an ongoing basis – ranging from an annual customer satisfaction survey to regular dialogue with our local communities through information and education programs, as well as community partnerships.

As active and engaged members of our local communities, Lynas and our employees actively participate in community activities, and members of our local communities actively participate in Lynas activities. Community investments across our operations included funding for projects in the areas of economic diversificatin, local employment and training, culture and heritage, education, environmental stewardship, sports and recreation, community wellness, health services, and supporting women and girls and disabled members of our communities.

Lynas employs local people, source from local businesses, and make an active contribution to our local communities. Our approach includes information and consultation with local communities as well as partnerships with government and non-governmental organisations. In Malaysia, local employees represent 97% of Lynas Malaysia’s 650 strong workforce. Indirect employee numbers, including contractors and those employed at firms for whom Lynas Malaysia is the sole or major customer, are estimated at more than 1200 people.

Lynas Malaysia was proud to receive a Malaysia Best Employer Brand Award Certification from the World Federation of HR Professionals in April 2019 and Asia Best Employer Brand Award Certification in August 2019. The most recent is Best in Corporate Social Responsibility by Lang International (November 2019). These awards takes into consideration how a company is combining vision with action in its people strategy, building internal competencies, providing equal opportunities for women leaders and demonstrating social responsibility. Mining and Chemicals have traditionally been male-dominated industries and Lynas has been proactively promoting equal opportunities for women. In line with this, Lynas has had a key focus on increasing participation in operating areas, including requirements that qualified female applicants are included in open positions. Lynas continues to work diligently towards increasing employment opportunities for women across our organisation and promoting women into leadership roles.

The safety of our people, our communities and the environment will always be our first priority and Lynas demonstrates this through our ISO certifications, and by ensuring compliance with licence conditions and international standards at our world-class chemical processing plant.

ABOUT LYNAS MALAYSIA SDN. BHD.

KUANTAN: PT17212 Jalan Gebeng 3, Kawasan Perindustrian Gebeng, 26080 Kuantan, Pahang Darul Makmur, Malaysia. T: +609 582 5200/5800 | F: +609 582 5291/5292

www.lynascorp.com Advancing Hand In Hand With You

KUALA LUMPUR: Level 23, NU Tower 2, KL Sentral, Jalan Tun Sambanthan, 50470 Kuala Lumpur, Malaysia.T: +603 2727 1862 | F: +603 2727 1818

OUR PRODUCTS ARE ESSENTIAL FOR MANUFACTURERS

ALL OVER THE WORLD... NOW AND IN THE FUTURE

Limitless Mind: Learn, Lead and Live Without BarriersAuthor : Jo BoalerRP: RM79.90Special Member Price: RM56.00

When we learn, we change what we believe and how we interact with the world. This changes who we are as people and what we can achieve.

Many people grow up being told they are 'not a maths person' or perhaps 'not smart'. They come to believe their potential is limited.

Now, however, the latest science has revealed that our identities are constantly in flux; when we learn new things, we can change our identities, increase our potential and broaden our capacity to receive new information.

Drawing from the latest research, Professor Boaler followed thousands of school students, studied their learning practices and examined the most effective ways to transform pupils from low to high achievers. Throughout her study, Boaler has collaborated with Stanford University neuroscience experts, harnessing their

expertise to reinforce her advanced understanding of learning and educational development.In Limitless Mind, Boaler presents original ground-breaking research that proves that limiting beliefs really do hold us back

from fulfilling our potential and that with a few careful life hacks we can transform our potential for good.

2020 Must Reads

R M 5 6 . 0 0

T H I S I S S U E M I M L O V E S

7 Secrets to Investing Like Warren BuffetAuthor: Mary Buffet & Sean SeahRP: RM69.90Special Member Price: RM49.00

A complete guide for beginning investors who want to understand how to invest like Warren Buffett.

This is one of the first books to showcase both Warren Buffett's Value Investing technique and his life skills and habits for beginning investors.

Sustainable results often come from changes in lifestyle and habits; hence, the first section of the book discusses habits that one needs to adopt to be able to invest like Warren Buffett, and prepares readers for a lifelong journey of wealth building.

The second section examines specific stock-picking techniques. The authors look at timeless principles as well as latest ideas on where to find great investment ideas, and share specific financial indicators they look for in a good investment.

The authors explain valuation principles and techniques that help investors decide when to buy a stock. The techniques are inspired by investor and economist,

Benjamin Graham, the 'father of value investing', and are vastly different from the common Wall Street wisdom of trying to time the market. The final section of the book explains how the reader can build and track a portfolio of stocks.

R M 4 9 . 0 0

M O R E G O O D R E A D S

OFF THE BOOK SHELFM

ANAG

EMEN

T •

VOL

. 55

NO.

1 •

202

0

4 6

Targeted: The Cambridge Analytica Whistle-blower’s Inside Story of How Big Data, Trump, and Facebook Broke Democracy and How It Can Happen AgainAuthor: Brittany KaiserRP: 79.90Special Member Price: RM56.00

In this explosive memoir, a political consultant and technology whistle-blower reveals the disturbing truth about the multi-billion-dollar data industry, revealing to the public how companies are getting richer using our personal information and exposing how Cambridge Analytica exploited weaknesses in privacy laws to help elect Donald Trump--and how this could easily happen again in the 2020 presidential election.

When Brittany Kaiser joined Cambridge Analytica--the UK-based political consulting firm funded by conservative billionaire and Donald Trump patron

Robert Mercer--she was an idealistic young professional working on her fourth degree in human rights law and international relations. A veteran of Barack Obama's 2008 campaign, Kaiser's goal was to utilize data for humanitarian purposes, most notably to prevent genocide and human rights abuses. But her experience inside Cambridge Analytica opened her eyes to the tremendous risks that this unregulated industry poses to privacy and democracy.

For purchase of books, drop us an email at membership@mim.org.my or call 03-7711 2888 to place your orders. Offer is only valid for purchase through MIM and is not applicable to any bookstores.

R M 5 6 . 0 0

Ultralearning: Master Hard Skills, Outsmart the Competition, and Accelerate Your CareerAuthor: Scott H. YoungRP: 79.90Special Member Price: RM56.00

Now a Wall Street Journal Bestseller.Learn a new talent, stay relevant, reinvent yourself, and adapt to whatever the

workplace throws your way. Ultralearning offers nine principles to master hard skills quickly. This is the essential guide to future-proof your career and maximize your competitive advantage through self-education.

In these tumultuous times of economic and technological change, staying ahead depends on continual self-education—a lifelong mastery of fresh ideas, subjects, and skills. If you want to accomplish more and stand apart from everyone else, you need to become an ultra-learner.

The challenge of learning new skills is that you think you already know how best to learn, as you did as a student, so you rerun old routines and old ways of solving problems. To counter that, Ultralearning offers powerful strategies to break you out of those mental ruts and introduces new training methods to help you push through to higher levels of retention.

R M 5 6 . 0 0

O F F T H E B O O K S H E L F

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

4 7

C orporations all over the globe share a common dreadful feature and in the absence of this feature, businesses figuratively are said to be one that operates in the holy heaven. That feature is known as risk! Risks created either by forces of external events or those that we find hidden amongst strategic business units (SBU’s) internally in our organisations will always exist and threaten the line of sight set forth by the stewards of businesses as long as they remain running businesses anywhere on this globe. Shareholders, by virtue of their capital investment, exercise their legal rights to assemble knowledgeable and skillful people to manoeuvre their interest and in doing so, delegate authorities to board of directors of the incorporated entity the shareholders had built.

Many enterprises’ board of directors strive to fulfill the strategic and oversight roles dictated by good corporate practices indoctrinated in board charters. They meet regularly and make decisions within the scope of their responsibilities. Within the board, separate committees with appropriate skills are often seen to arise to handle specialised operations. Nevertheless, the existence of the committees does not relinquish the board of their holistic accountability and responsibility mandated by shareholders.

The board of directors determines a company’s policy decisions, oversight and its management team and therefore exhibits overall control on it. As much as the board exercises its control, shareholders also act in concert in controlling the company. This type of shareholders are referred to

a conflict of interest as a situation where an individual working for an entity is confronted with choosing between the duties and demands of their position and their own private interests.

Below are five examples of how a conflict of interest may arise.

Risks created either by forces of external events or those that we find hidden amongst strategic business units (SBU’s) internally in our organizations will always exist and threaten the line of sight set forth by the stewards of businesses as long as they remain running businesses anywhere on this globe.

Managing Conflict of Interest in a Business Enterprise

By Vijaya Devan Nair, A member of MIM, OM 125677

OPINIONS

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 3

as “controlling shareholders” and their controlling power varies on the size of their dispersed or concentrated ownership. In addition, their parameter of controlling power also pretty much depends on their voting rights attached to each class of shares.

In the wake of overlapping roles between board members and the management team, valuable decisions are made and agreed by a few who hold power without going through a

collective board participation. Conflicts of interest are very much prevalent at the board level. This is because the boardroom is a dynamic place where struggles of ego, power, rules and authority continuously surface, and it is not always clear what constitutes a conflict of interest as director duties tend to diverge from one company to another and from country to country. This adds even more complexity.

What Defines a Conflict of Interest? In a corporate environment context, a conflict of interest is defined as circumstances that are architectured through malicious decisions that paves the way to enrich decision makers or parties related to them with promises of financial or non-financial gains.

Transparency International which is a global movement setup with a vision to create a world free of corruption defines

O P I N I O N S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 4

chain management. The board chairman’s wife is the owner of the new vendor company.

Here, a conflict of interest has already taken place when the chairman sits in the board meeting and participates in the selection of the new vendor. The decision made will bring personal gains to his family members.

Example 3: A CEO of an organisation who is also the board chairman of an enterprise used uses inside information to make profitable investment to enrich himself without getting authorisation from the board.

Example 4: An ex-board director with knowledge of property, information and product of his previous company, opens another new company with similar business operation.

Here, although the director has left the company he is still bound to the ‘conflict of interest’ clause.

Example 5: When an employee of an organisation is promoted to a supervisory position by her manager because of her close allegiance with the manager, a conflict of interest occurs!

How Does a Conflict Arise? As explained in the examples, conflict of interest can lead to biases that has a tendency to smudge integrity and ethical virtues of a person's ability in making the right decisions. Humans are most likely to exploit their positions for personal gains instead of obligation to others. Human brains are not wired hard enough to be able to distinguish

their personal interests from their professional duties. It is understood from some scientific brain experiments in the past, the human brain is divided into limbic and cognitive areas in the prefrontal cortex.

Biases arise from the exploited psychological status of human brain. As mentioned, the human brain is not wired strong enough to hold and therefore is weakened by the intrusion of self-servicing elements into our brain’s cognitive system. Conflict of interests arise when the cognitive system is compromised. So how then do we solve the threat of biases human minds and subsequently reduce the risk of conflict of interest?

Example 1: An accountant who prepares a cheque and at the same time authorises the cheque by unilaterally signing on it.

Here, a conflict of interest is said to have taken place when the accountant cashes in the cheque for personal gain.

Example 2: A board chairman, chairs a board meeting in which important decisions are made in the selection of new vendors as part of the corporations supply

Conflict of interest can lead to biases that has a tendency to smudge integrity and ethical virtues of a person's ability in making the right decisions.

O P I N I O N S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 5

Managing and Mitigating Risk of Conflict of InterestThere are 2 ways of managing and mitigating a conflict of interest. They are:

1. Establishing best practicesa. Culture i. Form a policy to create

a culture of ethical behaviour. This policy must be communicated to all stakeholders. The methodology to channel the best practices policy can be initiated through training or via newsletters.

ii. In addition, a reward procedure for behaviours which is in line with the policy will have a meaningful outcome. Those found breaching the policy should be reprimanded.

b. Resolution i. Employ qualified people to

develop processes to address and resolve conflicts of interest.

c. Training i. Conduct training programmes

for risk owners on fraud and risks due to conflict of interest as well as exposure to good ethical culture in the company. Best practices applied in the industry can also be injected into the training programme.

d. Review i. The policies, processes and

the training programme should be reviewed for

compliance by stakeholders and for assessment of the overall programme’s effectiveness.

2. Monitoring and inspectiona. Reports (weekly basis) i. A summary report on

“conflict of interest” disclosure and the resolution by risk owners are distributed to each head of department. This step will allow them to monitor compliance at their structural level.

b. Tracking of completion (monthly basis)

i. The reports from the heads of department are recorded and compiled, showing number of disclosures that has been resolved, pending

and its corresponding percentage of completion.

c. Tracking of acceptance (monthly basis)

i. After compiling the disclosure reports in 2(b), it is then vital to compile statistics on resolved and unresolved issues. This provides a clearer status of accepted resolution, unaccepted resolution and its corresponding accepted percentage.

d. Others i. Occasionally meet vendors

and suppliers and question them on matters pertaining to conflict of interests. These stakeholders must be obliged to notify the risk compliance officer of any potential conflicts.

ii. Setting up of helpline/hotline calls for reporting of conflict of interest.

A conflict of interest if perceived to arise, can generate negative public opinion thus board of directors along with executive managers should put the interest of the enterprise first by curbing the appearance of the dreadful risks from misaligned interests, a.k.a conflict of interest.

Interested to share your views? Send us your article via email to management@mim.org.my. *The views and thoughts expressed in the article are the author’s own and do not reflect the opinions of the Malaysian Institute of Management.

There are 2 ways of managing and mitigating a conflict of

interest. They are:

Establishing best practices

Monitoring & inspection

O P I N I O N S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 6

The Late Honourable Chief Justice (Rtd.) Yong Pung How will always be remembered as the formidable chief justice who always looked out for those with less power and money, and made sure lawyers were on their toes and thinking on their feet. He shook the Singapore Bar out of its lethargy and left behind a legacy that of a modernised judicial system.

He was not only an illustrious and outstanding public servant, but an ardent champion of education and a generous benefactor to the National University of Singapore. A humble man, Chief Justice Yong once said in an interview that his ‘finest hour’ was the day he married his wife, and that even after 5 decades, he still considers her his best friend.

“To stay happily married with a good reputation and a close-knit family must be one of anybody's happiest achievements in life, whatever the work you do.”- Chief Justice (Rtd.) Yong Pung How, 2004.

Chief Justice Yong read law at Downing College in Cambridge University. In 1949, after the war, he continued his studies and graduated with a Bachelor of Arts degree from Cambridge University and qualified as a

Barrister-At-Law of London’s Inner Temple.

He then practiced criminal law as a partner at the law firm Shook Lin & Bok, of which his father was a founding partner. He left in 1955 to serve as the Chairman of the Malayan Public Services Arbitration Tribunal, and moved to the Malaysian Industrial Court. In 1964, Chief Justice Yong established the Singapore branch of Messrs Shook Lin & Bok. That year, he also became the Chairman of Malayan Airways. He then assumed the role of the Vice- Chairman of Malayan Banking Berhad.

Following riots in Malaysia in 1969, Chief Justice Yong migrated to Singapore with his family. In 1971, he left the legal world to join OCBC as a director and eventually became the Chairman and Chief Executive Officer of the organisation.

After nearly two decades away from the law, Chief Justice Yong returned to law and was appointed Supreme Court judge in 1989. Just over a year later, he was appointed as the Chief Justice. His innovating ideas and forward-thinking measures, transformed the Singapore legal system into one of the best in the world.

Chief Justice Yong was also actively involved with the Malaysian Institute of Management since its early years. The National Institute of Management was officially formed on the 29th of January 1966, in response to the growing need for more managers to underwrite the nation’s development. In October of 1966, the Institute organised a one-day seminar on the Companies Act at which Chief Justice Yong was a speaker.

Dr. Tarcicius Chin, Former MIM Chairman (1989-1991) and Court of Emeritus Fellows has fond memories of Chief Justice

Chief Justice Yong Pung How's transformation of the court system is well documented. He single-handedly conceived and drove its modernisation, taking the courts from the practices inherited from a 19th century colonial system to the 21st century.Photo Credit: The Star

The Late Honourable Chief Justice (Rtd.) Yong Pung How

R E M E M B E R I N G I C O N SMIM Court of Emeritus Fellows

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 7

Tan Sri Abdul Aziz Abdul Rahman, in district officer’s uniform, with his wife Puan Sri Wan Zakiah Ibrahim in 1960.Photo Credit: The Star (file pix)

Mr Yong Pung How (left) with Mr Lee Kuan Yew and Madam Kwa Geok Choo on the banks of the River Cam in Cambridge in the summer of 1949. Mr Yong and Mr Lee became friends at university. Photo Credit: The Straits Times

Allahyarham Tan Sri Dato’ Dr. Abdul Aziz Abdul Rahman left behind a legacy, one that will forever be etched in the history of our national carrier. As CEO and the first managing director of Malaysian Airlines, his approach was to serve, making him an integral icon of the corporate world. Described as mild-mannered and polite, he was well liked as he treated others around him with the utmost respect and consideration.

He was an active member of civil society groups and amongst others worked towards the sustainable town planning of Kuala Lumpur as the chairman of the Save Kuala Lumpur Coalition. In an interview in 2014, Tan Sri Aziz stated that the proudest achievement of his life was helping turn MAS from something very small, into a global, award-winning, international airline.

specialises in this. You may say that I know it like the palm of my hand,” said Tan Sri Abdul Aziz about his love for MAS.

Tan Sri Abdul Aziz grew up during the Japanese occupation, and attributes his success to the discipline and diligence emphasised by the Japanese.

Qualified with a Barrister-at-Law from Lincoln’s Inn, London, he joined the civil service as an administrative officer and later became a magistrate and sessions court president. The racial riots in 1969, saw Tan Sri Abdul Aziz appointed as the Legal Counsel and Legal Officer of the National Operations Council, where he played a vital role in drafting laws to protect the nation against incidences such as May 13th. He left the service after 15 years and moved to a role to help in creating Malaysia’s own airlines as Malaysia and Singapore split.

Yong and said, “During the early days of MIM, many members of MIM contributed directly to the functioning of the Institute, and Yong Pung How contributed by giving talks at tea meetings.” “He and his fellow representative from the private sector contributed much time and professional expertise to support the fledging national management organisation,” he added.

In 1968, Chief Justice Yong became the Vice President of MIM alongside YABhg Mulia Raja Tun

Mohar Raja Badiozaman. He continued for another term with Y.M. Raja Tan Sri Ir. Zainal bin Raja Sulaiman and was elected into the Court of Emeritus Fellows on the 28th of March 1975.

Former Chief Justice Yong Pung How passed away on the 9th of January 2020. He was 93. His passion and contributions towards the Institute will never be forgotten and will continue to be part of our history.

“Civil aviation is close to my heart till this day. I reckon it is a God-given talent. I don’t think there is anyone alive today who

Allahyarham Tan Sri Dato’ Dr. Abdul Aziz Abdul Rahman

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 8

Tan Sri Abdul Aziz became the company secretary for Malaysia Airlines in 1971, having been appointed by the then Prime Minister, Tun Abdul Razak Hussein himself. His hard work and dedication, made him the legal affairs director and eventually the Chief Executive Officer and Managing Director of the airlines.

He took the national airlines to great heights, helping it soar not only in profits, but international accolades for its achievements in its inflight service. During his tenure, the company saw the immense growth of passenger traffic, aircraft number and routes. It wasn’t as easy feat, as the airline had suffered a RM39 million deficit and was in dire need of a RM70 million rolling fund. Tan Sri retired in 1991, leaving Malaysia Airlines with a surplus of RM5 billion in cash.

A lawyer by qualification, Tan Sri Abdul Aziz donned on his robes and continued his passion in law after retirement.

A highly respected corporate figure, Tan Sri Abdul Aziz became the Court of Emeritus Fellow of the Malaysian Institute of Management on the 10th of July 1987. Former MIM Chairman (1989-1991) and Court of

Emeritus Fellow, Dr. Tarcisius Chin, recalls how Tan Sri Abdul Aziz took his role as Fellow seriously and despite his busy schedule, constantly made the effort to attend the quarterly Court of Fellows meetings held at the Management House in Jalan Ampang, Kuala Lumpur.

In the 1990s, MIM became the apex centre for the training and development of managers and executives, offering international academic degrees in collaboration with the University of Bath, England; Maastricht University, Netherlands and

RMIT University in Australia. According to Dr. Tarcisius Chin, Tan Sri Abdul Aziz took keen interest in the progress of these programmes and assisted in the continuing development of the Institute.

Tan Sri Dr. Abdul Aziz Abdul Rahman passed away on the 22nd of January 2020 from cancer complications. The Malaysian Institute of Management mourns the loss of a distinguished figure. His contributions towards the institution will always be remembered.

Aziz with his 40-year-old replica of a Boeing 707. He holds his role in helping MAS grow from a small domestic carrier into the international award-winning airline it was in the 1990s as one of his proudest achievements. Photo Credit: SAM THAM/The Star

The legacy of heroes is the memory of a great name and the inheritance of a great example. -Benjamin Disraeli

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

5 9

YABhg Tun Daim Zainuddin Returns to the TAR Lecture SeriesGrand Ballroom, Shangri-La Hotel, Kuala Lumpur. 18 December 2019

Six industry stalwarts inducted into MIM’s Court of Emeritus Fellows.

M I M H I G H L I G H T S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

6 0

F ormer finance minister and chairman of the Council of Eminent Persons YABhg Tun Daim Zainuddin once again graced the TAR Lecture Series stage to present his keynote address.

In 1996, YABhg Tun Daim Zainuddin had spoke about “Managing Technology for Growth and Development” at the 17th Tunku Abdul Rahman Lecture Series.

Then being the economic advisor to the Malaysian government, his foresightedness was prevalent as he emphasised the need for our workforce to be technologically fluent to compete in the next century.

This time, at the 29th TAR Lecture Series held on December 18th, 2019, YABhg Tun Daim Zainuddin openly shared his wisdom and insights on what the future holds for Malaysians and the nation.

He has earned the distinction of being a hard-driving technocrat and reputed as one of Malaysia’s ablest economic architects. So, it was only apt that his address was titled “The Future of Malaysia: Building a Sustainable Ecosystem for All”.

The TAR Lecture Series is a prestigious event inaugurated by the Malaysian Institute of Management (MIM) in 1970 to commemorate the premiership of Malaysia’s 1st Prime Minister, the late Tunku Abdul Rahman Putra Al-Haj.

It is used as a platform to foster thought-leadership, encourage interaction and incubate strategies for future leadership skills. It aims to showcase some of the most sought-after and forward-thinking leaders from around the globe, sharing insights on challenges and issues of a dynamic and globalised economy and society.

Since its inception, the series has showcased leaders and dignitaries, including Malaysian constitutional monarchs and Prime Ministers, as well as esteemed, local and international high-profile individuals.

In his welcoming speech, MIM Chairman, YBhg Tan Sri Megat Najmuddin Megat Khas had this to say about YABhg Tun Daim Zainuddin.

“More recently, it was a case of who do you turn to when the going gets tough, which came with the change in government and the daunting task of dealing with an entrenched administration of 61 years.

“Bending it to a new will, required a Council of Eminent Persons to deliberate and make recommendations in a time frame of 100 days as the first order of business.

“And, of course, our Prime Minister turns to YABhg Tun Daim Zainuddin.”

M I M H I G H L I G H T S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

6 1

Tun Daim’s Life Before PoliticsHe was one of 13 children born to a clerk in the Kedah state service and a homemaker mother. He had his early education in a Malay school, before going to the Sultan Hamid College, where Prime Minister Tun Dr Mahathir Mohamad himself had attended.

Since YABhg Tun Daim Zainuddin did not know about his selection into Brinsford Teacher College in England, he sought to become a lawyer.

He went to Lincoln’s Inn, London before being called to the British Bar in 1959 at the age of 21.

He kicked off his career with Pillai and Co and then Shearn and Delamore in Kuala Lumpur before moving to a legal firm in Kota Bharu.

M I M H I G H L I G H T S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

6 2

He added: “Automation and robotics mean that less labour is required, and fewer people forced into triple-D jobs–dirty, dangerous and demeaning.

“Farming then becomes a high quality occupation, one that generates a good steady income and one that does not require hours of hard labour in the fields.”

His plan of focusing on smallholders and farmers would allow Malaysia to work towards poverty alleviation and eradication.

“We must identify ways to improve their incomes whether through commercialisation of waste products, downstream activities, reduced production costs or diversification of crops.

“Besides the farmers themselves, the modernised agriculture sector will create jobs along the supply chain,” he said, citing researchers, analysts, drone manufacturers and food technicians as examples.

He said more is needed to be done such as the removal of roadblocks for farmers who lack access to land and financing.

M I M H I G H L I G H T S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

6 5

“It’s very difficult to get land because it’s a state matter. Acres of idle land are just being wasted.

“I’ve written to the state governments asking to give land. Some were very encouraging and replied ‘yes’ while some didn’t even reply.”

In his proposal was also the creation of a government agency to address these issues.

“I’m confident if the government does this, enough people will want to go into this sector and we’ll be able to reduce our food costs and there will be excess to export.

“We will be able to reduce our food bill by 30% in three years.”

Court of Emeritus Fellows On the same afternoon at Shangri-La Hotel Kuala Lumpur, guests witnessed the conferment ceremony of MIM’s newest Court of Emeritus Fellows.

This is the highest category of MIM membership, awarded to outstanding individuals who have contributed significantly to the field of management and leadership.

“Leadership has become increasingly difficult, complex and multi-faceted in today’s globalised world. We wish to recognise the strong and effective leadership these individuals have showcased not only in their organisations, but across their industry,” said MIM Chairman, YBhg Tan Sri Megat Najmuddin Megat Khas.

The recipients were:1. Nestle Malaysia Chairman, YAM Tan Sri Syed

Zainol Anwar Syed Putera Jamalullail,2. Penang Police Chief (Rtd), YBhg Dato’ Seri A.

Thaiveegan Arumugam, 3. YTL Corporation Berhad Executive Director,

YBhg Dato’ Yeoh Soo Min,4. Bintulu Port Holdings Berhad Group Chief

Executive Officer, YBhg Dato Mohammad Medan Abdullah,

5. Key Accounts Management, Asia Pacific for AECOM, YBhg Datuk Zainal Amanshah and

6. Melaka Manipal Medical College’s Chairman of the Board of Governors, YBrs Dr Arun Kumar.The conferments were presented by MIM

President YABhg Tun Mohammed Hanif Omar and witnessed by YABhg Tun Daim Zainuddin.

M I M H I G H L I G H T S

MAN

AGEM

ENT

• V

OL.

55 N

O. 1

• 2

020

6 6