Sunday, March 29, 2015

Singapore and the Closed Organizational System

With the death of Lee Kuan Yew, former prime minister of Singapore for three decades, there is renewed debate on the so called "Asian Value" versus the Western liberal democracy. Lee championed the idea of Asian value, which advocates an alternative form of government that emphasized efficiency over freedom of speech and democracy.

Singapore's successful development over the past 30 years from one of the newly industrializing nations to a top international financial center today with a per capita GDP that's on par with the US, seems to vindicate Lee's vision. But past performance does not guarantee future success. And here is why: Singapore's success relies on a closed organizational system.

A close system is structured, top down, with clear chain of command. Meetings are held behind closed doors, decisions are made by few, speech is limited, and feedback focus on the negatives - the problems. With a strong and formal leadership a closed system can be efficient, especially in repetitive processes. The system is most successful when definition of success is clearly defined over a long period of time.

But there are drawbacks to the closed system. A closed system does not embrace change easily. Individual freedom is sacrificed. New idea is easily rejected if it's not coming from the top. In a world when product cycle becomes short and cultural appeal becomes an important differentiator, a closed system may find itself challenged.

Democracy, on the other hand, is an open system. An open system balance good of the whole with that of the individual. Collective decisions are arrived by consensus and depends on people's value. It emphasizes collaboration, communication, team work, and problem solving. Feedback balances between positive and negative. Change requires consensus and acceptance.

The strength of democracy lies in its adaptability. Different ideas are constantly evaluated and competing with each other. Talents can be found from unexpected corners. Innovations can thrive. In a changing environment where definition of success can change in a short period of time it has the advantage of both distributed thinking and collective wisdom.

Closed system is more efficient to solve well defined problems. An example of that is the military. An open system incorporates value, culture, and individual freedom, and will be more effective in solving a wide variety of problems in the long run.

No comments: