I chanced upon this lecture given by Rory Sutherland at The Welcome conference and really enjoyed it thoroughly. I think it gives a lot of inspiration on what it means to go beyond the frontier when we’ve reached the limits of where rational optimisation has brought us – be it business or policymaking.
I also think he was right to first highlight that such thinking works better within certain domains (eg. marketing, hospitality, maybe F&B services). It could work well for certain aspects of policymaking, too. And I think it holds some lessons for the Singapore public service to certain extent.
It’s about 45 minutes long but I’m sure you’d find it a delight too.
My work in the energy transition over the past decade or so have been about fossil fuel diversification but also about renewables diversification. As the system gets more and more electrified, the point of failures shifts from the end-nodes of the energy consumption system (eg. engines, electrical points, etc.) to the transmission and distribution systems, as well as the point of generation.
This is why energy mix features strongly as something that requires government to plan and determine. Singapore’s power generation fleet is ~95% natural gas and hence there is huge risk in being exposed to international gas supply. So we are technically using a mix of long-term contracts and short-term ones, as well as a mix of piped natural gas and liquefied natural gas.
But that is all fossil. What about renewable power? We have been relying on solar power off the rooftops, the mobile plants on empty plots, and the floating solar on reservoirs and that is great. And then we’re thinking of importing renewables from neighbouring countries, which involves long subsea cables at high voltages to transmit the power to Singapore. In order to use the asset well, it is best that the power transmitted is firm and not renewables so you don’t have to oversize the transmission capacity. So you put batteries for those wind and solar power; and then you also try to import hydroelectricity.
But what happens during the dry season (low water levels and hence low hydro), when there are forest fires and haze that block out the sun’s rays and reduce solar yield?
As we are deep within another season of transboundary haze pollution problem, we notice that the energy transition plans may require greater understanding of risks. If the entire region’s energy that we’re relying upon is mainly solar-based, a severe haze event could reduce power yield and result in supply inadequacy. This is regardless of how much battery power you have in the system because the firming is more to smooth out the volatility and system fluctuations across a day, not to deal with capacity factor or yield reductions.
And this brings me to the argument that we need to make the energy transition with a kind of diversification that we do when we had fossil sources in our energy mix as well. We need to be able to secure different, uncorrelated forms of supply and energy vectors in order to maintain supply resilience and stability, even if that may mean a blow to the price/cost impacts. Take it as an insurance premium of sorts. We are buffering ourselves from having to scramble for just what everyone needs when the crisis happens.
Often, this means importing green fuels. That could be biomethane produced from anaerobic digestion of waste water or other wet organic waste streams. It could also mean biodiesel, renewable diesel, or other biofuels produced from organic residues and waste fats and oils from regional markets. This would help us diversify our sources of energy not just geographically but also the pathways that we are relying on so that we are not at the mercy of an energy crisis whenever there is forest fires.
At the same time, developing demand for biomass residue and putting pressure on valorising biomass waste can change incentives for the plantations and forestry industry. If aggregating the waste, processing it can provide a slight return better than break-even, it might make sense for them to do so rather than burning the waste in the forests or fields. The balanced transition requires more systems thinking.
At first, I thought it was because I didn’t speak a word of Japanese.
There was something silent about being in a country that spoke a foreign language you do not understand.
But then I realised it wasn’t just my own experience. Others thought that Tokyo was quiet for the density of the city as well.
It is amazing. Indeed.
It was impolite to take calls in cafes.
And I realised that when Japanese people spoke to each other in the city they did not speak out aloud; they leaned in and speak. They were intentional and speaking to one another, not talking out loud randomly.
It was interesting and I sure think we all can learn a little from that.
Coming back from Japan, I found Singapore pretty noisy. The traffic, the ventilators, the impatient people using their voice to rush others – with their orders, with their pace, with their movements.
I wished we didn’t have to use our voices that much.
I think it’s great that Edwin & Shulin’s interview/podcast with Steve Chia and Tiff Ang on CNA provoked a whole bunch of discussion. The point that Steve brought up at the beginning of the podcast was that he talked about the need to balance between the aspirations of the nation and the work preferences of the younger generation. Unfortunately, it wasn’t really the conversation they had because the grander picture of Singapore’s economy and market evolution isn’t mentioned.
Jeraldine Phneah actually posted a video discussing some of her take on how these things blew up and it was a really balanced perspective. I like how she gently took a jab at Shulin’s approach to delivering the message when Shulin herself talked about the importance of communication.
Personally, I’m more concerned about the characterisation of what ‘hunger’ is about. A lot of the discussions made it seem like this ‘hunger’ is self-evident but it isn’t. Different people had different interpretation of what hunger is and what it looks like.
For Shulin, it might be more about an attitude, not projecting so much me-first; being willing to stretch and take on learning opportunities as opposed to viewing things outside job scope as a chore or seeing some work as ‘beneath’ a job title. Yet for many others, hunger might look more like desperation; of making sacrifices that are unreasonable, and sucking up to bosses, going all out to please clients or entertain their unreasonable requests, etc. Shulin even posed ‘hunger’ as binary – whether you have it or not. That just probably didn’t seem right.
Tan Min-Liang, the founder of Razer, made a very good point on Linkedin about the younger ones behaving simply as a response to the corporates and employers. Give them the right sense of purpose and the work that they feel they deserve, and they will make the appropriate sacrifices.
Technology has made it possible for people to just keep working non-stop; and at the same time, companies may not have properly adapted technologies to their own business and workflow, and managed their employees poorly in that process. It would only make sense that without the management improvements (with management being stuck in the 80-90s mindset and management style), the company is suffering from actually really poor productivity, of which the younger employees are bearing the brunt of.
So the question now goes back to the employers. Are they hungry enough? Are they hungry enough for the right people and talents to provide the appropriate training, software systems, management and leadership? Shulin mentioned about employers’ lack of flexibility and the corporates limitations in meeting the needs of the current workforce culture. I thought Tiffany helped to voice out some of that employers’ and managers’ grievances about the inability to have the real conversations about work / job redesign. These are exactly the issues that we are not confronting enough in this podcast. I am actually really glad that the younger workforce is forcing employers to rethink their approach.
It will be politically challenging for the government to keep the situation in the way it is and allow the market to simmer and boil a bit so that the culture would shift. To do that, they will need to let businesses struggle with the manpower challenges. But maybe, they need to do just that.
There is fundamentally a tension between bureaucratic structures and human judgment. The reason for such structures is to reduce the need for, and also disperse the responsibility of judgment. Often, it tries to aggregate wisdom but sometimes at the cost of creating more inertia for action.
Bureaucracy starts with good intentions: create systems and structures to minimise errors, repeat proven actions by making them a matter of policy, and prevent potential rogue players from having discretion. And potential rogue players within the system mean just about everyone. Yet it promotes conformity and compliance.
The ones who would break the rules and create wins won’t make the cut for promotion if they go too far with rule-breaking. Often, structures prevent them from going far enough to end up with wins. Those who do would probably cause loopholes to be closed up anyway.
But bureaucracy allows you to swap talents for mediocre hires, especially in highly stable environments. Take the example of infrastructure financing; the early pioneers of project finance did the hard work, used their brains to work out the risks, quantify them and set up best practices. They created financially viable structures matching the underlying needs. The ones who come after just copy their templates, sometimes even without completely understanding how the risk management or control works. They are trained more for pattern recognition and for finding market deals that work for the structures they create. This still brings value to the system, and they are rewarded for this stage of industry development. So, more people who can match the patterns will rise within the system. Those who actually think thoroughly about the risk and keep trying to innovate get stuck in the middle. Even if they stick around long enough, they do not have the chance to get their innovation pushed through the system.
New kinds of infrastructure are overlooked because they are “too hard,” when it’s easier to find what fits in the market or wait for the next deal. And so the previous innovation that succeeds cannibalises on future innovation. And the structure to scale up and deliver greater success on something that works inhibits successes of different variety.
Could it be that Singapore is running up against such an issue?
When I watched Secondary the Musical last year by Checkpoint Theatre, there was so much that resonated with me, with the teachers around me about the Singapore education system. It stirred me to feel something about teachers, students, inequality, and even though there was something moving about the end where the teacher chose to stay and continue to live her passion for teaching, I could not but feel a sense of unease for the character.
I had thought and understood that this was what art was to do for us. And this was why there was such a time when the artists seemed as though they were critical of government all the time. Artists’ role in society is ultimately to bring out the subjects, topics and matters worth the attention of society. They could be overlooked groups in society, or matters that still need to be deliberated and discussed, rather than considered a “sacred cow”.
Arts is also a way to cry out in a deeply human way the causes that are worth attention not because of commercial numbers or tangible metrics but that they touches deeper aspect of being human. Whether it is our relationship with nature, or heritage and history, minority culture, there are just things that our marketised, industrialised modernity do not capture though we as humans ought to.
The place of the arts is also for aesthetics and beauty, but one that has identity and soul in the society from which it blossoms. Yet what is the business model for the arts? In a capitalistic society, what are we to do to feed our artists? Whose responsibility is it to ensure they are not exploited by commercial interests to support unworthy causes? What alternative systems are available to fund, to protect them?
I’ve been fighting against the prevailing culture for the past decade of my career. And for those who blame things on culture and act like it cannot be changed, they are being delusional. I have a few examples to show:
How did we get from flagging for a cab on the street to punching our mobile phone screens to hail a cab?
How did we get from ‘solar power’ is too inefficient and there is not enough space in Singapore to targeting a 2GWp solar by 2030?
How did we get from being in kampongs where we helped each other and lived for generations in a house to thinking that our financial lives depend on getting BTO, then selling it after MOP and then upgrading non-stop over our adulthood?
While it takes time, culture can be changed. It also takes identifying some loose bricks in the existing edifice to overhaul the structure of our prevailing culture. Energy transition is one tough one to crack, but that said, our region in Southeast Asia has already moved quite a bit from the days of coal-fired power generation. Yes there was a bit of attempts to catch on with the hype around hydrogen but the dollars and sense prevailed at least for now.
So I’ve been toying with the idea of doing a lot more content to teach all of us about energy transition and to be able to learn together. There is a whole lot of de-stigmatising, trying things out, and unlearning our previous biases to be able to move the culture a bit and accelerate the transition. There’s a question of format, level of engagement, how to manage and nurture a community and so on. I guess I’ll have to dive in head first.
Despite being a Christian, I’d probably confess to living most of my life like an atheist, and for most of us in the modern world, that is perhaps the case. As we send our reports and deliverables to clients, we don’t start praying to God for Him to grant favour in the eyes of our clients. At the same time, before we start our meetings to make crucial decisions, it’s not like we ask the Lord to grant us wisdom to decide the right course of action in a corporate prayer. Beyond prayer, more often than not, we are petty with the way we approach our suppliers, and potentially quite transactional on many interactions.
If we had been in a more agriculture setting, surely after tilling the land and sowing the seeds, we would have prayed for good weather and for patience to arrive upon harvest time. Each day as we work the fields we’d ask the Lord to bless the work of our hands. And when if we were to be waiting in the market for someone who needs our produce to pass, we might ask for customers, and we might deal with them with greater kindness than we would when chasing a customer for bill payment.
I don’t know if it’s the environment, the (false) sense of self-sufficiency and control that leads us to act this way. But we often enjoy acting like we are in control; and we are glad for the assurance from others’ false sense of control over circumstances and happenstance. We have lost the security and comfort that we can have in the embrace of God’s grace and His provision. And each time we practice that modern day ritual of self-reliance and independence from nature and from God, we weaken our faith so much.
Having worked in consulting across cultures, I have begun to recognise some cultural behaviours when buying consulting across different countries and the attitudes towards consultants. Having advisors is nothing new; the monarchs of ancient times have had advisors to support them for as long as they existed. These advisors offered more than just advice, insights or knowledge that leaders did not possess (or did not think they possessed).
They offered assurances when it was scarce. Soothsaying, contrary to what people might think, actually means telling the truth; with ‘sooth’ being an old English term that meant truth, as opposed to ‘soothe’, which means to calm. And the advisors also provided perspectives that during times of wiser monarchs, could contradict the conventional wisdom or call out the folly of the leaders.
So if we distil it down to the value that consultants provide today:
Knowledge of what may not be known to the client: this is when consultants are selling their expertise, and familiarity with a topic area that clients are not familiar with
Assurance of a particular course of action, decision, or information: this is when the client needs something verified, checked, validated and confirmed. The confidence and conviction of the advisor matter here as well, compared to those who hide behind jargon and ‘expert lingo’.
Sparing partner or challenger to ideas: consultants can be valued in bringing new perspectives, especially an outside-in view of things thereby co-creating more valuable solutions or decisions with the client.
I begin to recognise that Asian firms especially with rather paternalistic leadership tend not to use consultants the way the West use them. So for example, when it comes to knowledge, the Western clients may appreciate specific subject matter expertise that comes through years of experience and in-depth research. In contrast, Eastern clients may value knowledge of implicit/unwritten local rules and norms rather than expertise in a more technical subject. The more institutionalisable the knowledge set is, the less likely an Eastern client would appreciate it as worth paying for.
Western clients see assurances from consultants as important while Eastern clients prefer to take the risks of not having check through things by themselves. This might have something to do with the way trust is formed. In Asian societies where getting things verified can be read as a sign of mistrust, it is challenging to value such independent checks and perspectives. The very deed of using independent validation can almost be an insult.
Finally, when it comes to having a sparing partner, the typical harmony-loving, and conflict-avoidant Asian culture would really struggle with the idea of paying someone to challenge you. In fact, leaders might instead assert the power of their wealth/influence over people so that they would not be questioned.
In this sense, Asian cultures tend towards getting advisors who can provide knowledge that is undocumented and unavailable in the public domain, and are often independent individuals with the specific gifts of being able to reveal ‘truth’ to the client. They also prefer that the knowledge advisors gain about the client cannot be easily disseminated. And as far as possible, they only care about knowledge that cannot be institutionalised.
This means that it is incredibly challenging for most professional, western-chain consultants to survive solely from serving a pool of Asian clients. If anything, they usually have to ‘survive’ off the big multi-nationals who are growing into new, and perhaps opaque markets, or needing more capacity support. In other words, consulting has grown out of an increasingly international market, yet not overly uncertain because surely some stability is necessary for consultants to be deemed to have accumulated enough lessons and experience to share.
Random musings as I continue to build up my knowledge and capability of managing a consulting practice.
