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ITU Telecom99 + Interactive99 Forum - 'Information Age Company'

Mr Yeo Cheow Tong, Minister for Communications & Information Technology Keynote Address - Geneva

Mr Yeo Cheow Tong, Minister for Communications & Information Technology
Keynote Address - Geneva,
Switzerland, 11 October 1999

Trends in the ICT World

1. Some of you may be wondering why a minister has been chosen to give the keynote speech on this topic of "The Information Age Company". If you have indeed been wondering, then you are in good company. I too, have been wondering why, since this topic seems better suited to a management guru, or a CEO of a Fortune 500 Company.

2. After some reflection, I decided that it is probably because the organisers wanted something broader than what the topic suggests. After all, an Information Age Company does not and cannot exist in isolation. Governments and society in general, too, have important roles, In effect, the Information Age Company can perform best in an Information Age economy. My remarks this morning will therefore cover some of the challenges facing corporations, and also what Singapore is doing to facilitate the development of an Information Age Economy.

Ladies and Gentlemen,

3. The topic may give one the impression that we are addressing future issues and challenges. But in reality, we are not. For many of us, the future is already staring at us in the face, unleashing forces of change which threaten our very survival. We will need to help our organisations to understand the forces at work, and, if necessary, to even re-invent ourselves.

4. One company did - Nokia. Some ten years ago, it decided to focus on its telecoms equipment business, and exit it other businesses. At that time, its telecom business had sales of only a quarter billion US$, out of total business revenues of about US$2.5 billion. It was a tremendous leap of faith and shrewd judgement. Today, then years later, the quarter billion US$ sales figure has exploded over 60 times, to sales of almost 16 billion US$. Nokia is today a dominant player in mobile telephone equipment.

Ladies and Gentlemen,

5. It is arguable that the changes wrought by the information revolution will be as total as the invention of the steam engine which heralded the industrial age, or the use of fossil fuels which gave us the modern era of motorcar and air travel. These changes will undoubtedly affect also the typical organisational forms we work in. The distribution of work responsibility by functions such as production, sales and finance, was designed for maximum efficiency in the industrial era. The top-down, command-and-control model optimised corporate productivity. But just as the organisational forms that best suited the family farm, the smoke factories of the Victorian era, and the multinational corporation of today were different, it is likely that the information age company will look and work quite different from the organisational forms dominant today.

6. I would like to mention a few ideas as food for thought for our panel discussion. The first is the networked organisation - The Information Age company will almost certainly not be structured like traditional pyramids. This recognises that most of the knowledge is not at the top levels of the hierarchy, but in the front-line.

7. The purpose of the organisational structure is to bring a network of professionals together, and enable them to effectively share information so as to obtain better results. The shape of the network may be fluid as projects and needs change. Individuals may not have a permanent place in the organisation chart, but shift from project to project. Clearly, managing results in this sort of organisation requires fundamentally different systems and skills from traditional organisations, where the boss gives directions to subordinates.

8. Managing knowledge across the organisation, so that everyone in the organisation can access the knowledge capital for his work as and when he needs it, is an equally tough challenge. Anderson Consulting is achieving this through its knowledge management system, aptly called Knowledge Xchange. It captures the lessons learned in its research and daily work, and gives over thirty thousand consultants worldwide access to that knowledge, 24 hours a day.

9. I would also like to mention the Singapore Government's attempts to be a networked organisation, although I think we are at a more basic level than the likes of Andersen Consulting and GE. For the Singapore government, email, web pages, intranets and groupware are more than just useful support technologies. They have totally changed the way we work, and become an inseparable part of our work and decision-making processes. Ideas and initiatives now flow rapidly within departments, and across organisations, up and down the entire hierarchy.

10. The second challenge is that posed by the Internet. One can hardly open the newspapers or trade magazines today without reading about the impact of the Internet. It has added a huge new dimension to business economics and opportunity. It is proving to be a vital marketing and productivity tool, and is spawning new services and companies. Companies that ignore the impact of the Internet, do so at their own peril.

11. The third idea that I would like to raise, is innovation as the creator of value. All of us marvel at Silicon Valley and many of us wonder about how to compete with it. Professor Gary Hamel of the Harvard Business School offers a good insight: he suggests that we are confused by thinking about Silicon Valley as a geographic place. Instead, Silicon Valley should be seen as a way of operating, or an eco-system. And he suggests that companies can bring Silicon Valley inside themselves. He sees Silicon Valley essentially as a marketplace for talent, for capital and for innovation.

12. In Silicon Valley, Ideas, Capital and Talent circulate freely. People there are obsessed with creating new ideas. While most companies are set up to do existing products or services better, cheaper, more efficiently, Silicon Valley people focus on innovation and creation. They firmly believe that it is not incremental improvements, but new ideas - the next big thing - that creates new wealth. Capital funding is always available for good ideas. Talents flock to killer opportunities. This is how a dynamic of newer and better ideas are created.

13. The challenge we face is how to enable the same dynamic to happen within our companies and our society. How do we enable an environment where good ideas are continually generated and nurtured? 3M is a famous corporate example of how an organisation can survive on innovation. Many of us may already know the story of Art Fry, one of 3M's employees. He used an unsuccessful adhesive glue product to create strips of removable sticky paper to use as page markers for his hymnal in church. Thus was born Post- It notes. But the key is that this invention was not an anomaly for 3M. Central to 3M is the principle that "Thou shalt not kill a new product idea".

14. In Singapore, we are addressing the challenge of fostering an environment of innovation, starting from the schools. The concept behind our "Thinking Schools Learning Nation" strategy is that knowledge is not a fixed body of facts that children should learn, but that it is more important to learn to think, to explore, to create. Teachers are not there to teach a fixed body of knowledge, but to be guides to exploring the infinite world of knowledge. Along the way, we hope to infuse a culture of innovation and enterprise, a readiness to take calculated risks and a willingness to accept failure as a learning experience.

15. The fourth topic that I would like to raise is attracting and retaining talent. In the information age, talent is the key asset. Corporations around the world acknowledge that the key battle going forward is for talent: capital will always be available, but talent will always remain scarce. Talented people want to work for organisations that enable them to enjoy coming into work every day, to develop as individuals, and achieve their personal goals. How a company attracts, retains and motivates its talents will therefore separate the winning companies from the rest.

Singapore's Transition to the Information Age

16. I would like to close by speaking briefly about Singapore's own efforts to become an Information Age economy. We are aggressively putting in place the necessary infrastructure to remain internationally competitive, be it our legal and policy infrastructure, or our communications infrastructure. For instance, on telecommunications, we have fully liberalised the provision of Internet exchange services and public Internet access services. We are actively enhancing our regional and international Internet connectivity. Broadband access is also available to 98% of all homes, and to all schools.

17. We are doing well in some areas. The International Data Corporation, in its 1999 Information Society Index, ranked us the fourth most information-driven economy, after US, Sweden and Finland. It further projected that Singapore would move up to number two position on its world ranking by Year 2002. Last month, Singapore was also named as the "Intelligent City of the Year" by the World Teleport Association. In its 1999 ranking, US-based Business Environment Risk Intelligence (BERI) has rated Singapore's workers best in the world first for relative productivity.

18. However, we recognise that all our competitors are doing likewise. The pace and the exact details of initiatives differ, but the direction is the same. Our competitive advantage will have to be our people. It is the quality and the mindset and motivations of the people in Singapore, and how we can organise effectively in a networked area, that will determine how well we do.

19. I would like to make brief mention of 2 areas where I believe Singapore is differentiating itself. The first is on openly welcoming foreign talent. We strongly believe that foreign talents with specific skills and experiences will complement our local talent pool, and help create new businesses and employment opportunities. This is something that other countries sometimes cannot do, because of domestic political and social constraints.

20. The second is on broad-based uplifting of capabilities across the workforce. We are partnering the private sector by putting in place programmes to continually re-train workers and upgrade their skills. This emphasis on people development will enable us to continue as a value-adding partner, and is a win-win formula for all.

Ladies and Gentlemen,

21. Recognising challenges is the first step forward, whether it is on the part of a company, or a country. The Information Age will hold tremendous opportunities as well as grave threats for all if us. Companies that can successfully manage the coming changes will prosper and grow. On the part of Singapore, we know that we must remain relevant to the global business community. We are indeed listening, learning & changing with the global Information Age trends. We intend to be a strong, relevant player in this exciting New Age.