Opening Address By Mr Heng Swee Keat, Minister for Finance, at the SNEF “Beyond SG50” CEO and Employers Forum: “Reset Management Intuition, Be Future Ready”

Dr Robert Yap, President, Singapore National Employers Federation

Ms Mary Liew, President, National Trades Union Congress

Mr Teo Siong Seng, Chairman, Singapore Business Federation

Distinguished guests

Ladies and gentlemen

1             Good morning. I am pleased to be here at the inaugural SNEF Beyond SG50 CEO and Employers Forum. Coming to Capitol Theatre brings back fond memories, and I can’t help reflecting on what an interesting time we are in. When I was here watching wuxia and kungfu movies, it was about the past, and the most advanced weapon was the sword and yourself. Now Robert is talking about digital glasses which offer a whole database to you. It shows the changes over the years. Yet what is interesting about Capitol Theatre is how some things have not quite changed. Many people predicted the end of cinema with online streaming, but still people go to the cinemas and enjoy watching movies together. And the transformation of Capitol Theatre is itself a very interesting transformation.  

2             I would like to thank SNEF for your commitment to progressive employment practices, both socially and economically. The theme, “Reset Management Intuition, Be Future Ready”, reflects SNEF’s forward-looking mind-set. I welcome this mind-set. We need it in the ever more complex and competitive global economy.

3             The forum is very timely. We had our first Committee on the Future Economy meeting on Monday. Robert Yap and Teo Siong Seng were there. I see a few of our members, Susan Chong and Goh Swee Chen included, who were also there. I appreciate your perspectives as employers. I am sure all of us bring the insights and ideas that have been learnt from all of you to the table. I invite you to share your thoughts with them, so that they keep on doing so.

4             And I am happy to be meeting with all of you employers today, as I would like to share with you my beliefs about a specific strand of value-creation – value-creation for our people, and with our people.

Value Creation

5             In the future economy, we need to not just add value, but also create value. In a value-adding frame, we look at what others are already doing, and we try to make incremental improvements, to do it maybe faster or better, and compete on that basis. However, if we wish to be highly competitive, we ought to be producing what the rest of the world is not producing or at least not that much of, and do what the rest of the world is not doing or not doing much of, with new products, services or processes. That is value creation.

6             How can an economy as a whole do it? By building deep capabilities and linkages, in our companies, in our industries and in our economy, to create new products and deliver better services with better processes in innovative ways.

7             And how do individual companies do it? We will have a session today on these areas, but I believe that people are the key. As employers, you all have to organise and develop your resources so as to make them more than the sum of their parts.

8             But you are also employers, organisers of people. Companies regard people as a resource – hence, the term ‘human resources’ and human resources department. But I would argue that people go beyond being a resource. In fact, people are at the heart of a company. By enabling the imagination and creativity of our people to flow, and by organising ourselves well, we can achieve strong performance today, and build innovative capacity for tomorrow. We can bring out the best in our people when they can do their best for our organisations.

9             We do this by creating value for our people, by developing opportunities and channels for their professional development and progress. This stems from our core belief that when people feel a sense of purpose and personal development, they will be at their best. Professional and economic performance follows from that.

10          SkillsFuture is the Government’s commitment to work together with industry, schools, and our people to create value for our people. At its core, SkillsFuture is a movement to enable all Singaporeans to develop to their fullest potential throughout life.

11          Just as how the success of Singapore and the success of Singaporeans are intimately linked, the success of companies and their people go hand-in-hand.

Effective Organisations

12          So how do we go about doing this? In order to develop people and bring out their potential, we need to develop effective organisations. As Peter Drucker wrote, a manager’s task is to make the strengths of people effective and their weaknesses irrelevant. I think this statement recognises that everybody has strengths and weaknesses; there is no perfect person. It also recognises that people have complementary strengths. When we put together a team, it is about how to maximise these strengths and make their weaknesses irrelevant. Effective organisations bring together motivated individuals with diverse strengths to collaborate and achieve results that far surpass what each alone can do. That is the essential difference and that is the essence between working alone and working in collaboration with others.

13          I had a discussion recently with the leader of a team based in the United States that had achieved major breakthroughs in technological innovation. It is a breakthrough that I believe will change a lot of what we do. He told me that he paid great attention when assembling his team, and saw himself as an integrator of the people in his team.

14          To do this, he not only assembled a team with diverse skills, a whole portfolio of skills that he thought was needed for the project to succeed; he took effort to develop their skills further. And interestingly, he also thought deeply about how to get people to work together effectively. Besides the usual project management meetings, he even went down to plan where people’s workstations were, by understanding their personalities and strengths. So he related to me how he put two people with very different skills and personalities next to each other, because their collaboration was so important to the project. And he put them together so that they would develop trust, and to have many opportunities to interact with one another day in, day out and spark off fresh ideas. So I asked him, did it work? And he said, yes it did, because those two members then came up with very important breakthroughs in language recognition.

15          By articulating a vision for his team, by assembling the right skills mix, and by creating a climate of collaboration, he brought his team to achieve major breakthroughs in innovation.

16          This is what I mean by creating value with our people. A first step in developing our people is to be clear of our business mission and strategy, structure our business model and harness technology to help meet our goals. I was very intrigued to see how, outside this theatre, Sakae Sushi had brought in these revolving sushi counters that really addresses some of the challenges of manpower constraints.

17          Critically, if we involve and develop our people in our strategic and innovation process, we can achieve more than if we treat these as separate activities. Developing our corporate capability and the skills of our people are mutually reinforcing strands of value-creation, and these two endeavours go hand-in-hand. This is what the best organisations do, to bring out the best in their people, to bring the organisation to its best.

Innovation and Adaption

18          Of course, the worst organisations are those that ignore the need for learning and development of their staff. But even organisations that conscientiously train and develop people may be at risk if their business models do not keep up with change.

19          Kodak’s pre-eminence in photographic film was completely disrupted by digital photography. We don’t know what will disrupt digital photography in the coming years. Today, parts of the retail and financial sectors are at risk of being disrupted by online retailing and new financial technology respectively.

20          While it is important to train staff on managing current tasks well, it is equally important for employers to think of developing capabilities to innovate and adapt business models to changing trends. People development and corporate development need to go hand-in-hand.

21          We now live in a time of rapid change, where companies all over the world are producing differently than before, customers are consuming differently from before, and goods and services are now moving differently from before. All these shifts mean that employers need to operate differently from before. We need to cultivate a culture of innovation. This does not mean a massive R&D budget. Rather, it starts with thinking of and tapping on the strengths and creativity of our people.

22          Innovative organisations rely on innovative people. We see how these feed into each other – people need effective organisations and organisations need capable people.

23          Employment is what brings people to organisations. So when we think about how to match the right people with the right organisations, we must also think about having the right jobs to link them together, and indeed the right portfolio of skills to link them together.

24          In today’s environment, the premium on finding the right person for the right role is higher than ever, and we need to design jobs with the employee in mind – what are their aspirations? What are their talents? How can I bring out the best in them, so that they can do their best for our company?

25          When we were working on the SkillsFuture initiatives, I met many students to understand their aspirations, and why they chose to join particular companies. Not surprisingly, students look towards organisations that have plans to develop them. They do not want dead-end jobs.

26          As the growth of our labour force slows, it is even more important for companies to create development pathways to grow the skills of their staff. Programmes like Earn and Learn and structured internships are designed precisely to enable companies to do that – to not only grow the skills of your staff, but to also enable employers to re-design jobs to maximise the opportunities for your people to do their best. I hope that employers will make the best use of these schemes.

27          When we had our first Committee on the Future Economy meeting a few days ago, quite a few members said that when we move towards the future economy, remember that our millennials – the new generation of workers born in the 1990s – will make up a big part of the future economy. They have grown up in a first-world Singapore, and see jobs as more than a way to pay their bills, but as a purpose or a life mission. So, I hope too that our employers will tap into this sense of idealism to draw out the best in your millennials. Interestingly, when someone spoke about the millennials, someone else in the committee said: don’t forget the older workers, because we also have many and our thinking about the older workers needs to change. In the old days, they retire very early, but today, older people are more active, energetic and we should think about how to tap on this pool.

28          And two nights ago, I watched this interesting programme on Channel NewsAsia called the Hip Hop Grannies in China. And it was so amazing to see a whole group of grannies doing hip hop with young people, teenagers. One of them said, yes, we might be old but we want to live our own life. And another said, I want to live a flamboyant life! That is the energy of even the older workers.

29          I have spoken at length about the role of employers. I would be remiss to not also mention that every one of us, as employees, has an important role too. When I was at MOE, I emphasised that our aim is to develop self-directed, confident learners and active contributors. While employers need to provide opportunities and create the right climate, we as individual staff need to also take ownership for our own learning and contribution. As I once told a group of students whom I was interviewing for a job, who had asked me what I was going to do to train them; I said, well I will certainly train you, but as students, you paid school fees to attend school; yet as staff, you are paid, so I expect you to contribute. Therefore, even as I urge employers to provide learning opportunities, I urge staff to also do your part to contribute.

30          I have also spoken at length about change. But one thing should not change: our values – valuing our customers, our partners, and our workers. I value the partnership of employers in creating good opportunities for Singaporeans, and helping our people to grow and progress as the economy grows. I would say, as you “reset your management intuition”, call upon the defining values of your organisation, respect your people as your most important resource, and bring out the best in them. This will help set your direction in the complex new territory that we face today. While much else will change in the future economy, how we respect and value one another, and how we work together through challenges, will not change.

Conclusion

31          Let me conclude by reiterating that with the complex changes going on around us, employers need to adapt and innovate to stay ahead. To create value, organisations need to develop both corporate and innovation capabilities, as well as develop and make the best use of the skills and creativity of their people. These two processes – developing corporate strengths and people strengths – are not separate activities. Instead, these are mutually reinforcing, and provide a powerful combination.

32          On a broader front, we need to take a comprehensive approach to the future economy. How we design jobs and impart skills to help our people to be at their best, and how we innovate and restructure our companies – they must go hand-in-hand. This is what we need in management intuition for the future economy. And employers, workers, and the Government must work together to develop our firms and develop our people. And people need to take ownership.

33          This is one key area that the Committee on the Future Economy will tackle, and we welcome ideas from all of you.

34          I am confident that we will get there if everyone embraces this change and work together. I am most encouraged by your coming together to prepare for the future. Let us work together to create value for our people, with our people.

35          I wish you all a fruitful forum. Thank you.