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Executive Education

Category: Thought Leadership

Are freedom and discipline at odds with each other? In today’s modern workplaces, Dr. Thun Thamrongnawasawat, Professor of Practice at ASB, explains why both are necessary, and how they can help organizations thrive in the face of uncertainty.

When discussing freedom and structure within organizations, the two concepts are often seen as polar opposites at odds with each other. Common wisdom holds that small companies can allow autonomy and flexibility, but grow more rigid as they scale. For managers trying to strike a balance between what is often seen as opposites, it can feel like a choice between the lesser of two evils: a ‘Wild West’ type of freedom or a bureaucratic hellhole from a Dilbert comic strip.

But freedom and control aren’t necessarily opposites; they can work hand in hand within a framework that provides structure without being suffocating. Dr. Thun Thamrongnawasawat (or Dr. Tan as he likes to be called), Professor of Practice at ASB and prolific leadership author, teaches a course which explores how trust and autonomy can enable agility and innovation, how to balance freedom and good governance, and how leaders and managers should rethink the way they manage their people, using the approach called Freedom Within the Framework.

The value of freedom in a pandemic affected business environment

“More than ever, autonomy is a big motivating factor for the current workforce, especially for the younger generation. Increasingly, it is not money that is driving them to quit their jobs, but having the freedom and choice of what to do and how to do it,” said Dr. Tan, who has worked with over 100 global companies on strategy, leading change, training, and executive coaching, and specializes in the neuroscience of leadership, with MSc and PhD degrees from the University of Illinois at Urbana-Champaign.

Dr. Tan started his career at the Boston Consulting Group, before holding a series of management positions in multinationals and eventually devoting his career to his passion of empowering leaders using what is known about the brain, giving him tremendous experience to draw upon when it comes to the science of management. “People want the autonomy and agency to be able to create change and do things in the way they see fit.

Even for those who don’t quit employment to start their own businesses, they may seek out opportunities in the corporate world where they are treated as an intrapreneur,” he added. Covid-19 has made the increase in autonomy at work even more apparent. More employees than ever are working from home, away from their usual oversight, rules, processes, and in-person interactions.

“There are both pull and push factors contributing to the increased need for autonomy and being able to trust your people,” said Dr. Tan. “The pull factor is that employees want this. The push factor is that Covid-19 has forced this upon management teams.” Science backs the value of giving workers greater trust and freedom, as Daniel Pink’s 2009 New York Times Bestseller, Drive, highlights, drawing from research including an MIT study.

Pink argues that traditional “carrot and stick” approaches to management are insufficient to meet the needs of today’s economy which requires businesses to be innovative, creative, and agile. Successful modern workplaces cultivate intrinsic motivation among employees, underpinned by three key components: Autonomy, Mastery, and Purpose.

Freedom through discipline

But the benefits of autonomy don’t come from letting people do whatever they want. “Ironically, it is the companies who are the most disciplined that reap the most benefits of entrusting their employees with freedom,” he argues. “Take Netflix, for example. They got rid of their expense policy and replaced it with a short, simple statement: ‘Act in Netflix’s best interest’.

But they could do this because they were fanatical and extremely disciplined about their culture, and had an extensive culture handbook.” “Another company closer to home that I can think of is EPF (Employees Provident Fund) Malaysia, which has implemented staggered working hours, telecommuting options, and a flexible benefits program to enable staff to easily strike a balance between work and their personal lives,” added Dr. Tan.

For EPF, the key was to enable freedom in the form of flexibility, without compromising on outcomes or KPIs. The company reports since implementing its work life practices, productivity has increased, along with winning them TalentCorp’s LIFE AT WORK Awards 2018 in the Best Public Sector Organization, CEO Champion and Outstanding Practice (Workplace) categories.

So how much freedom can you give your people while avoiding unnecessary risks, and how do you ensure that, like at Netflix, your team will ‘act in the company’s best interest’? Conversely, how can you know if working constraints are too tight, leading to a lack of trust and agility?

The key to freedom within a framework: Alignment of values and purpose

Dr. Tan explains that before managers can determine how much freedom to give to their team, they need to understand and map out their values and those of their team. Next, it’s important to understand which ones overlap and which ones don’t, to “avoid the landmines”, as Dr. Tan puts it. The final step is honing in on the sweet spot – or the overlap in common values and purpose that both parties share.

“Without this map, you might unintentionally step on a landmine – something another person values, because it’s not something you value. You might be caught off guard, wondering why this person is suddenly acting difficult and uncooperative,” said Dr. Tan.

“There are many ways this model can be applied – between individuals, or between groups of people,” said Dr. Tan. Dr. Tan shared a recent story of how he applied this model:

“A fellow colleague and I were tasked with running a leadership program, and we were making a decision about whether to host this program in person or online, given the current Covid-19 situation. We thought that because we had limited the number of participants and would be able to adhere to social distancing protocols, we could safely proceed with running it in person. Our boss was very concerned about this approach.

After some discussion, we recognized that the main value driving our boss’ concern was the participants’ safety and wellbeing. We could find common ground in wanting to ensure people’s safety. So, we decided to run the program but go a step further – we required all participants to take a swab test before joining us, even though it was not mandatory.”

The Six Zones of Freedom within the Framework

After a clear map has been made of the team and individuals’ values and purpose, what comes next? This is where the alignment of values and purpose is plotted on a horizontal axis, while the degree of freedom employees have is plotted on a vertical axis. This forms the framework developed by Dr. Tan together with Michael Kossler.

“While the concept of ‘freedom within a framework’ has been talked about for a long time, it wasn’t until we put this graph together that managers had a tangible tool to help them map out their framework,” explained Dr. Tan.

To use the framework, managers identify where each team member stands in terms of alignment, and how much freedom each one currently has. Anything outside zones 1 to 3 in the diagram below is suboptimal.

“Zone 4 employees are being given unearned freedom. These are the people who will cause you headaches. When there is too much freedom, smart people can do bad things. It’s not only one’s skillset that must be aligned with the job; the heart must be aligned with the company’s values.”

Meanwhile, Zone 5 employees are those with the capacity to perform at a higher level, but have their hands tied behind their backs. “With too little freedom, they stop being invested, start coasting by, and they don’t give you extra effort. They will probably start looking for a new job – and that’s where they enter Zone 6 – separation.”

For more detailed step-by-step guidance on using applying this framework, read Managing by Freedom Within A Framework by  Dr. Tan.

The key is to get employees outside the blue zones into those zones, by either reducing or increasing the amount of freedom given. For employees in Zones 1 and 2, the key is to work on increasing alignment, so that freedom can gradually be increased as well.

Avoiding landmines and building resiliency

One of the practical considerations with implementing Freedom Within A Framework is that it should be done on multiple levels to see where the overlaps are on an organizational, team, departmental, and individual level. And mapping it out is only the beginning.

“For this to be effective, people must talk about it. The hidden must be made visible. Groups must be brought together, or it won’t take long before people start stepping on each other’s landmines and talking behind each other’s backs. Trigger points are plenty – finding common ground requires intentionality,” said Dr. Tan. Beyond the workplace, he even uses this approach with his kids and spouse to build alignment through connecting on common values.

In today’s fast-changing world, alignment is more critical than ever to survive, adapt, and thrive. “Rules and governance are prescriptive. In light of Covid-19, it’s clearer than ever that we cannot fully know everything that will happen and prepare for all scenarios,” said Dr. Tan. “Instead of governing through rigid dos and don’ts, organizations can build greater resiliency, agility, and adaptability by giving people a framework to work freely within, guided by common values and shared purpose.”


About the ASB Iclif Executive Education Center
The Iclif Executive Education Centre at the Asia School of Business offers cutting-edge and action-oriented Executive Education programs that cover the key areas of Corporate Governance, General Management, Leadership, and Finance and the Global Economy.

For more information on our programs, please visit: https://asb.edu.my/executive-education

Building brand-customer relationships and driving brand transformation in the wake of Covid-19 is essential

Covid-19 has accelerated the digital disruption, changed the way businesses interact with their customers, and increased the need for businesses to move interactions online. During the recent period of lockdowns, customers have massively embraced these digital channels. And the growth numbers are staggering. Just two to illustrate: global digital sales are up +36% compared to 2019 (Salesforce.com, 2020).

Beyond B2C, in B2B the shift is remarkable: with 70 to 80 percent of B2B decision makers preferring remote human interactions or digital self-service over in-person interactions (McKinsey & Company). So how does Digital Age brand transformation play out for brands and branding? Firstly, as more customer and company eyeballs move online, the war for their attention is intensifying.

The advertising industry hit hard by Covid-19 sees the advertisers shift from traditional media to digital. Digital advertising spending is estimated to have increased year-on-year by 6 percent in 2020, according to WARC data, and presently accounts for more than half of all global ad spending. But branding and brand transformation in the Digital Age goes beyond employing new media channels. There are more fundamental strategic considerations to think of.

To empower companies to navigate the challenges of branding and marketing themselves in a digital world, Professor Willem Smit, Assistant Professor of Marketing at the Asia School of Business and an International Faculty Fellow at MIT Sloan, teaches a range of executive education and MBA courses on marketing strategy with a special focus on digitalization and internationalization of brands.

“We live in a changing, uncertain, and increasingly polarized world,” said Professor Smit. “We live in a branded world, where brands need to continuously seek to engage better with people who have changing needs and desires, and respond to changes to stay relevant. Brands and change cannot be seen in isolation – they are connected,” he added. “Moreover, strong brands are in a position of leadership and can or even must lead positive change and transformation. They must have a purpose. One that fits them.”

The dilemma of brand transformation in the digital age

How can brands use digital to build their strength and Brand Purpose to do good? With digitalization, Professor Smit explains, there is more information readily available, including more alternatives that are just a Google search away. A more equal and competitive playing field is created where local brands can delight customers just as well as global multinationals.

However, while technology brings new opportunities, it also presents a challenge. The sheer amount of data points for customers to judge brands by can be overwhelming, pushing customers to rely on trusted brand names and heuristics. This is where branding comes in. According to Professor Smit, “Many businesses find brand transformation a challenge in the digital age.

The dilemma of branding in the digital age is that unlike branding in the past, which you could carefully shape and craft, branding online requires a handover of brand ownership to your customers. It’s almost impossible to control what people say about you in user-generated and co-created content, from reviews to fan posts, and requires a shift to a more collaborative mindset.”

“Many people are excited about new technology, but are wary of not being able to control it. Amid privacy concerns and the reliability of online information, the importance of brand trust has never been greater. Brands who understand this and can build strong relationships digitally will be able to overcome the challenges,” he added.

Helping brands in emerging markets succeed on the frontier of change

Professor Smit brings with him a wealth of experience in global multidisciplinary marketing since earning his doctorate in Marketing from the Erasmus University in Rotterdam, the Netherlands in 2006. He joined IMD as a research fellow and began lecturing at the Université de Lausanne for several years, before moving to Asia in 2011 and holding various positions at Singapore Management University (SMU) the National University of Singapore (NUS), the MIT-affiliated Malaysia Institute for Supply Chain Innovation (MISI), and Hult International Business School in Shanghai.

While in Asia, Professor Smit’s exposure to brand transformation and brands at the forefront of change in emerging markets lead him to launch the ALL-ASEAN brands report in 2017 which surveyed 2,645 brands to understand how ASEAN brands are managing the digital disruption and which brands are leading in making ASEAN a more integrated marketplace, to share trends and best practice.

In the upcoming 2021 report, research on 4,153 different brands strong in ASEAN social shows a very interesting development: “ASEAN is witnessing a Cambrian explosion of new homegrown brands. Many of them have adopted digital to build their homemarket base. Yet, whereas ASEAN continues to integrate as markets, still only a very selective group succeeds in engaging consumers from neighboring markets, outiside of home.”

In addition to his teaching and research, Professor Smit is a prolific marketing practitioner and advises management teams and boards on strategy, marketing, and brand transformation. During his almost 10 years in Asia, he built a 700+ member community of junior brand managers, called So-You-Think-You-Can-Brand.

He also created a hands-on digital program for both MBA students and executives, where mixed student-employee teams collaborate to improve the digital marketing strategies of participating companies through a series of “hacks” implemented during the course itself.

Professor Smit’s experience translates to his hands-on classroom approach in teaching on topics such as:

  • What makes a brand strong?
  • Creating meaning-driven brands (with a purpose)
  • Measuring brand equity and brand success
  • Conducting a brand audit
  • Identifying growth opportunities: Brand extensions and internationalization
  • Making brands smarter: new tech and storytelling approaches

In his classes, case studies featuring brands from Asian and emerging markets are plentiful, from Pinkfong’s viral Baby Shark to Samsung alongside international brands like HubSpot and Aqualisa. Additionally, through practical exercises applied to participants’ own brands, participants can learn from peer brands throughout the region as well.

Bringing marketers and top leadership together to create brand value

For brands to thrive in a digital age, marketing and branding must be a core part of the corporate agenda, argues Professor Smit. Instead of viewing marketing as a service or cost center, it is imperative for firms to view marketing as a strategic and innovative function.

Through attending Professor Smit’s courses, current and future CMOs and marketing specialists will be armed with the knowledge and experience to make marketing and branding a key topic on the corporate agenda and drive brand transformation, while top management and board members will be better informed to make strategic marketing investments and decisions.

“Learning to understand each other’s perspectives and cater to each other’s priorities is the key,” said Professor Smit. “Marketing managers need to demonstrate the strategic value of marketing to the firm, and board members and top management need to understand marketing and ask the right questions to evaluate how their brands contribute to the corporate strategy. Both groups converge in seeing the customer groups as key to generate future cashflow.”

How To Win Customers in a Digital World: Transforming Asian Brands for Success

Iclif Executive Education Course by Professor Willem Smit  (4-day online course)
The next course on will be held on March 3, 4, 10, and 11, from 2.00PM – 5.15PM each day.

To download the Course Guide and for more information on upcoming courses, register your interest below:

Download the Course Guide

Q&A Session on ‘Transforming Asian Brands for Success’

A consultative Q&A webinar will be held with Professor Willem Smit on 18 February 2021, 4PM – 5PM for interested participants to preview the course material and ask Professor Smit any questions you may have about the course.

What should businesses and employees do when someone at work tests positive for Covid-19? And how can this be done without risking further business losses? MIT and ASB professor Kevin Crow discusses these issues and more with BFM: The Business Station.

The Coronavirus pandemic has undoubtedly affected the lives of people around the world across demographics. 2020 was a year many wish to forget, with many hardworking individuals losing their jobs and livelihoods during this pandemic. Small and medium businesses are being hit especially hard, faltering one after the other like domino pieces as losses force them to shut down.

For businesses who are still clinging on for dear life, some will go to desperate lengths to stay open and in operation for as long as they possibly can, concealing Covid-19 cases within their workplaces to do so. Large businesses are not exempt from this temptation as well, out of fear that a positive case may cause stigma and further losses.

Professor Kevin Crow, Assistant Professor of Law and Ethics at the Asia School of Business and International Faculty Fellow at MIT, is also active in legal consulting and international impact litigation and is also an affiliated researcher with Columbia University’s Freedom of Expression Initiative.

He recently spoke with BFM: The Business Station, a leading Malaysian radio station, to discuss these ethical dilemmas and provide businesses and employees with solutions on how to navigate when someone at work tests positive:

BFM: What is the impact of hiding positive Covid-19 test results among employees, especially from a legal point of view?

Professor Crow: There are many impacts from many points of view. There are the obvious economic concerns, reputational concerns, concerns on productivity, effects on other employees and legal concerns. From a legal point of view, there are concerns that are attached to contractual obligations between both the firm and employee; all of these can be implicated in lack of transparency and a lack of disclosure.

What duty of care does a business owe its employees as well as its customers?

A duty of care, in general tort claims, suggests that businesses have to take whatever action is considered to be reasonable by the society under the circumstances. There are a lot of factors that might come in to play there. You could consider factors like sector, industry, business type etc. Would a reasonable business of this sector or industry have acted as this business did? That is sort of the general standard to take into consideration, in any kind of tort claim.

With that in mind, if one of the main drivers in hiding the results is concerns about profit and loss of business, could you make a case for why it is better to be more transparent rather than be secretive about the health status of your employees? Because I think that tends to be where a lot of people are coming from.

Yeah sure, I guess I’m a lawyer, so I can make a case for anything. (chuckle) It’s important to first look at an entire social and economic system and not to place all the blame on economically strained businesses. It needs to be attractive to be transparent. Governments play a large role in creating that attraction through both punishment and reward.

The most obvious reason or case for transparency regardless of political circumstances is an ethical one: you could spread harm to others, both within your business and within the broader society if you hide it. There are also two obvious economic reasons that flow out of that: spreading the virus within your business harms your human capital within your business and spreading it to society, harms the broader economy of that society, therefore it harms your business as well.

How does non-transparency affect customer sentiments and their sense of loyalty towards brands?

Research shows there’s a pretty strong correlation between transparency and customer loyalty. So, non-transparency conversely reflects poorly. Those kinds of reputational harms affect customer-facing businesses more than B2B businesses.

Overall, what are the best practices employers should use when they do find a positive case in their business, especially among their workforce?

The same things that everyone has been saying. First, regular testing. Second, when someone does test positive, multilevel contact tracing. Third, isolate both affected and potentially affected employees. And finally, throughout the process, support everyone so that there is no fear of coming forward with a positive test rather relevant information.

Could you elaborate a little on what sort of support employees need when it comes to such circumstances?

First, they need to know that it is a good thing in the eyes of the employer that the employee comes forward. There can’t be any kind of element of punishment or fear associated with someone coming forward. Secondly, depending on the circumstances of the employee, they will need varying degrees of support for quarantine, or for other measures they need to take. So, do they have childcare responsibilities? Do they have elderly relatives at home? Employees need holistic support, and employers should be cognizant of that. Finally, and relatedly, employees shouldn’t be punished economically or otherwise for coming forward.

If you work in a company that is hiding positive cases and you are aware of that, what can you do to keep them accountable?

The answer is different whether you work in management or if you are an employee reporting to management. If you work in management, you should make it an issue if it isn’t already an issue. If you don’t have contingency plans already in place, you should bring this up with colleagues, even if it annoys them or if they don’t want this discussion to occur. History will most likely smile on your actions, so being temporarily unpopular perhaps doesn’t matter so much.

On the other hand, if you don’t work in management, a lot depends on the culture and the degree of trust within the firm. A grassroots organization with co-workers can raise awareness of detrimental impacts of hiding positive cases. Depending on what is important to your management, you could emphasis economic and ethical harms, legal and political repercussions – all of these are arguments you could make.

What can the government do in order to get companies to be more responsible and open when it comes to reporting cases?

They need to make it more attractive to do so. So, they have to provide support, both financial and logistical. In the long term, it is much more expensive for the government to discourage businesses from transparency through cost-saving measures than to incur the short-term costs by providing generous support to businesses that have to temporarily close.

If there no support and closing is a big fear, then non-transparency is more likely to happen. The best way to encourage responsibility is to make responsibility attractive and to make irresponsibility unattractive.

Sharpen Your Understanding of Ethics and Corporate Accountability

Professor Kevin Crow is a highly experienced educator with a wealth of knowledge in international law, constitutional law, economic law, and corporate law. He has taught at the University Halle-Wittenberg Law School in Germany and has practiced international criminal law with NGOs based in Cambodia and France prior to joining ASB. He is also an affiliated researcher with Columbia University’s Freedom of Expression Initiative.

In May 2021, Professor Crow will be teaching a course of on Ethics and Corporate Accountability. The interactive, discussion-based course is focused on teaching managerial responsibility for those who are faced with tough ethical dilemmas and also discussing legal and ethical thought when it comes to difficult business decisions. The courses will be offered digitally on 27 – 28 May and 2 – 3 June, 2021.

For more information on our programs, please visit: https://asb.edu.my/executive-education

An interview with ASB alumna, Zoe Tate

Unprecedented times translate to unpredictable industries. And this uncertain future has left many in a state of constant worry. For some, amidst the confusion and events of 2020, they chose to take advantage of these current changes by upskilling themselves with an education that will equip them with the agility, resilience, and skill to thrive in a fast-changing world.

Asia School of Business (ASB) alumni, Zoe Tate, is one such person who believes her MBA education has positioned her well for the future. Recently, leading MBA platform Poets&Quants had the opportunity to sit down with Zoe, in conjunction with the premium CentreCourt MBA Festival event — to hear about her experience pursuing an MBA in a pandemic, and all that ASB is doing on the forefront of global-tier education.

A life-changing course of action

“My first introduction to ASB was when a group of 4 students came to my startup, to give us strategies and insights to grow the business,” said Zoe. Here, Zoe is talking about students that were involved in ASB’s flagship Action Learning projects, which her startup was one of the hosts. ASB’s Action Learning curriculum is an immersive and rigorous module that allows every one of its MBA students to experience working with corporate, start-up, government and NGO hosts to join them on-site with selected projects.

Upon experiencing first-hand ASB’s Action Learning approach and even visiting the Kuala Lumpur campus a few times – Zoe quickly found herself enrolling as a student. ASB’s MBA program features the rigor and quality of MIT Sloan School of Management (MIT Sloan) set within the culture and environment of Asia. Here, students from all parts of the world gain an immersive and rewarding experience of combined perspectives between American and Asian learning methods.

According to Zoe, it’s this type of diversity that allows ASB to become a truly dynamic and engaging environment for an MBA. “There are students here that come from very varied backgrounds, in terms of their nationalities and their experience.” “You’re constantly negotiating what you learn, where you go, and how you approach problems,” Zoe told Poets&Quants.

Zoe continues to emphasize that because of ASB’s continued search for solving modern problems with modern solutions, it’s an organization that will be beneficial to its students in both the long and short term.

An MIT Sloan-infused syllabus, every step of the way

But how does the ASB curriculum integrate with that of MIT Sloan? Zoe’s personal experience in classes taught by highly-rated professors from MIT Sloan were nothing short of insightful and life-changing. “We’re so lucky that we get to be taught by them. They come for one week, and they teach their entire curriculum that’s usually a semester-long in one week,” Zoe says.

Visiting professors find creative ways to teach an entire semester’s worth of education within that time, as the small class size ensures that students get sufficient time with the professors. (Back at MIT, classes by these top professors are often at maximum capacity and students rush to enroll each time a class is announced – something that ASB students don’t have to compete for.)

Each class is nothing short of a quality experience as Zoe notes. “It gives you a global perspective and you would be able to anticipate in your mind how you’re going to use whatever you’re learning [in class] in your next project; it’s certainly a privilege.” Encouraging avid participation and fostering an active, curious class environment is yet another way MIT Sloan’s values are so prevalent at ASB.

Beyond the classroom to the real world

Zoe, who recently graduated in 2020 after completing her MBA in a pandemic, says that when it comes to her post-MBA working life, she knows that she’ll be ready no matter where in the world she finds herself. “When you learn from the MIT professors, you get a more global perspective. That, of course, is excellent if you want to work on a regional level, or if you want to solve problems from [different] industries or add skills that I have never experienced on my own.”

Zoe has already had some experience in International Development and SMEs. However, armed with an ASB education, she’s able to go beyond her initial scope of work, allowing her to find the bigger picture and see things on a larger scale. Ultimately, this is proof that education doesn’t stop on a professional level either.

Zoe highlights that even while completing an MBA in a pandemic, she was able to grow a natural skillset of three important traits that any company around the globe would accept with open arms. Those are: leadership skills, mindfulness and a strong spirit of teamwork.

“You’re in very close proximity with your classmates all the time, be it in the classroom or if you’re travelling or just socially,” Zoe says. As 2020 hit and students continued pursing an MBA in a pandemic, with many dialing in via Zoom, participation levels remained intense.

“Through all of these interactions that you have in this very diverse environment, you learn to identify what are your skills and what you can bring to the table.” Future-proof skill sets are imbued in all of ASB programs and teachings, in line with their Smart x Sharp DNA (a new framework for rethinking ‘soft’ and ‘hard’ skills) and the ASB promise to completely transform students into extraordinary, unconventional, future and market-ready leaders. Naturally, ASB’s Smart x Sharp culture shines through its Action Learning projects and the careers that graduates and alumni go on to build.

Pursuing a transformative MBA in a pandemic

Even as COVID-19 raged on, the resilience and resourcefulness inculcated at ASB allowed Zoe to keep a level head while pursuing an MBA in a pandemic. “[Southeast Asia is] such a dynamic region with a resilient economic growth and huge youth population as well with more investors being interested in the region; I have no doubt that Southeast Asia is going to recover from this.”

As for Zoe’s advice to aspiring ASB students? “Go in and be ready to be surprised. Have an open attitude, because you cannot predict the experiences you’re about to have, or the things you’ll learn and discover,” says Zoe.

Watch the full Poets&Quants interview with Zoe.

Central bank digital currency (CBDC) is a hot topic in today’s digitally-driven world, especially seen through the lens of Covid-19. Since China began working on its Digital Currency Electronic Payments (DCEP) project in 2014, and the Bank of England first raised the concept of a central bank digital currency (CBDC) in its 2015 research agenda, interest around CBDCs has become prevalent.

A recent BIS (Bank of International Settlements) survey of central banks found that 80% were exploring their own central bank digital currency, with this figure expected to rise further this year. “When the Libra project was announced in 2019, central banks’ interest intensified and they began actively experimenting with the opportunities presented by exploring their own CBDCs, as a working paper issued by the BIS found.

Before that, there was a lot of hesitancy towards the idea of a digital currency. When Facebook announced that Libra would be backed by a consortium of prominent multinationals, central banks especially started to take notice,” explains Professor Ong Shien Jin, Professor of Practice at ASB. With over 4,000 cryptocurrencies currently in existence, why did Libra catch so much attention?

“Libra, now renamed Diem, is not the first stable coin,” explained Professor Ong, “But it’s the most prominent one proposed thus far. Unlike Bitcoin, its value is intended to be kept stable, backed by reserves of fiat currency. And in the case of Libra, it also enjoys the backing of credible multinational firms. Recently, the Financial Times reported that Facebook plans to launch a limited format of the digital currency in early 2021.”

The world’s central banks have acknowledged the impact that digital currencies and digital payments are having on the financial system and economy. Big tech companies like Ant Financial (the umbrella under which Alibaba products like Alipay sit) have grown from offering e-wallets to offering online credit. Today, Ant Financial reportedly has around $600 billion in assets under management.

Yet there are many concerns posed by companies like Ant Financial, ranging from systemic risk to the financial system, to anti-money laundering, privacy concerns, bank disintermediation, interoperability of distributed leger technologies with existing systems, and ensuring that an appropriate regulatory framework is in place. All of these are issues central banks around the world are considering as the extent of digital payments grows.

The case for central bank digital currency

Central banks considering their own digital currencies have many reasons to do so. “There are many reasons for central banks to consider a digital currency of their own,” explained Professor Anella Munro, Professor of Economics at ASB. “For some, it is efficiency, where existing cash-based systems are cumbersome and risky (for instance, shipping cash between islands in the Caribbean).

For others, it is driven by the dwindling use of cash. For others, it is providing central bank money that is interoperable with digital payments technologies, to support their development.” “Additionally, for emerging countries, financial inclusion is an important concern. Digital currencies can allow citizens to transact more easily,” added Professor Munro. “You may say, sure, but that can be done with e-wallets.

But there’s another benefit for central banks to have their own sovereign digital currency on a wholesale level. When money is transferred between banks through electronic payment service providers, these are done using reserves in central banks. As part of this process there’s a settlement stage, and interoperability is important. A decade or two ago, real-time settlement was a big topic in banking, and that settlement is fast in many countries.

Today, central bank digital currencies based on blockchain offer a promising solution for finality, since you can’t edit the ledger, but the technology may not be there yet, in terms of speed.”

Additionally, central bank digital currency could enable “enhanced and faster transmission of monetary policy”, through being able to implement negative interest rates with fewer constraints, according to Deputy Managing Director at the IMF, Tao Zhang. It could also cripple tax evasion and underground economies that flourish with the circulation of paper money (Rogoff, The Curse of Cash, 2016).

Central banks say more research into digital currencies is needed

Despite the potential benefits, very few central banks have launched their own central bank digital currency to date. One of the world’s central banks leading the way is Sweden’s Riksbank, in response to dwindling use of cash. The Riksbank has been researching the potential of a central bank digital currency since 2016, and has launched a pilot project with Accenture Plc to introduce an electronic krona, according to Bloomberg.

A study launched on the feasibility of a potential transition to e-krona is expected to be completed by the end of November in 2022. However, other central banks are taking a more cautious, wait-and-see approach, including the Bank of England, whose governor Andrew Bailey told Bloomberg, “We’ll go on looking at [the possibility of introducing a digital currency], as it does have huge implications on the nature of payments and society.”

In the US, the Fed is working with MIT Media Lab on CBDC experiments under MIT’s Digital Currency Initiative to explore the potential opportunities, challenges, and tradeoffs that a CBDC will bring.

In Europe, Germany’s Federal Ministry of Finance released a position paper in July 2020, noting that although a digital euro could be beneficial in reducing transaction times and costs, it could also have “comprehensive implications” for the stability of the entire financial sector, requiring further analysis.

Asia is a leader in central bank digital currencies

China is leading and dominating the digital payments scene with Ant Financial. However, Ant’s scale is a concern for the country’s central bank, which recently suspended Ant Financial’s IPO that was set to raise $37bn in the world’s largest IPO, to ensure compliance with a new regulatory framework designed to safeguard the interests of financial consumers and investors.

The People’s Bank of China (PBOC) has also announced its own digital yuan currency, and has tested the Digital Currency Electronic Payment (DCEP) system in 4 major cities. Beyond China, the outlook, in Asia, on central bank digital currency seems to be more optimistic. Cambodia has been investigating the development of a central bank digital currency since 2017, having relied heavily on the US dollar for decades.

After a series of pilot tests, on 28 October 2020, Cambodia officially announced the launch of “Bakong“, its central bank-backed digital currency which supports transactions in the dollar and riel, the Cambodian currency. Bakong could allow Cambodians the opportunity to bypass card-based payments altogether and leapfrog straight to a cashless digital system.

Meanwhile, a joint project between the Bank of Thailand and the Hong Kong Monetary Authority (HKMA) saw the successful trialing of a Distributed Ledger Technology (DLT) for cross-border fund transfers, under Project InthanonLionRock.

Aside from China, Cambodia, Thailand, and Hong Kong, multiple other Asian countries are exploring developing and experimenting with forms of national digital currencies, including India, Indonesia, Vietnam, the Philippines, Korean, and Japan. Japan has already announced its plans to test its digital yen in 2021.

Helping banks understand the digital currency landscape

While the potential of CBDCs is promising, there are tradeoffs in introducing a central bank digital currency. To help central banks think about the opportunities and risks presented by sovereign digital currencies, Professors Munro and Ong at the Asia School of Business have begun teaching custom-built courses centered around digital payments and central bank digital currency.

Professor Munro, Professor of Economics at ASB, brings with her over two decades of experience in international macroeconomics, macroprudential policy, asset pricing, monetary policy, and international finance at the Asian Development Bank, the Reserve Bank of New Zealand, and the Bank for International Settlements. Complementing Professor Munro’s expertise in policy and regulation, Professor Ong, Professor of Practice at ASB, possesses a wealth of market experience.

With a background in computer science, he started out his career at Goldman Sachs and then joined the tech industry at JobStreet.com, the #1 online job portal in Southeast Asia. Professor Ong also holds a PhD in Computer Science from Harvard University and a Bachelor of Science in Mathematics from MIT. Together, their complementary skillsets enable them to provide in-depth insight into topics such as:

  • Overview of the existing digital payments landscape to set context
  • Reasons for implementing CBDCs and what types of experiments are currently underway in various central banks across the world
  • Design tradeoffs at the wholesale and retail level
  • Private alternatives to central bank digital currency
  • Case studies from countries who have trialed or launched CBDCs

“We’ve had some interesting discussions in these classes, given that our participants come from the emerging world. In Malaysia, we have Touch ‘n Go’s e-wallet being a partnership between Alipay and CIMB, and we discussed – how does this impact us in the emerging world? Would you want the big boys to come in and partner with your local banks or is there merit in homegrown fintech providers?” said Professor Ong.

“I hope that people will walk away from these sessions with a keener sense of the potential of the new technologies, understanding the pros and cons, and the complexities of digital currencies. We aim to help participants take a holistic approach,” he added.

World-class knowledge transfer on pressing topics for central banks

Beyond teaching these intensive courses on digital currencies, Professors Munro and Ong are also part of the faculty for the Asia School of Business’ (ASB) Master of Central Banking program, a joint partnership between MIT Sloan and the central bank of Malaysia (Bank Negara Malaysia).

The Master of Central Banking program is a 12-month residential degree program focusing on offering a comprehensive, first-of-its-kind curriculum that integrates all the core functions of central banking as well as leadership and governance. It is designed to prepare participants for future challenges, in light of the technological and economic changes taking place in today’s world.

“What’s exciting about the Master of Central Banking program is that it provides an integrative, forward-looking and global perspective on central banking. It combines the Sharp Skills – the more technical side of central banking – and Smart Skills – drawing on our MBA leadership curriculum. A significant portion of the course (30 per cent) is taught by professors from MIT, and the program includes six weeks at MIT Sloan, in Cambridge, Massachusetts.,” explained Professor Munro.

In addition to offering a Master of Central Banking program, ASB is also home to its Central Banking Research Centre, which offers fellowships to outstanding individuals in the field of finance and central banking, to promote research, exchange of information, dialogue, and professional interaction on topics related to central banking. This includes an ongoing webinar series Conversations on Central Banking, that tackles current issues in central banking and features former central bank governors and MIT faculty.

Demystifying the Fast Changing World of Digital Currencies

Iclif Executive Education Course by Professors Anella Munro and Ong Shien Jin (2-day online course)

The next course will be held on 3rd and 5th May 2021, from 9.00AM –  12.15PM. If you are a non-specialist, who wants to be able to make sense of, and be current on, the fast-evolving world of digital currency, this course is for you. To download the Course Guide and for more information on upcoming courses, register your interest below:

Master of Central Banking Program (One-year residential Master program for Central Bankers)

The Master of Central Banking (MCB) is a year-long residential program designed especially for central bankers. Participants will benefit not only from a curriculum that focuses obsessively on central banking, but also from the intense, hands-on experience of working in teams. To download the MCB brochure and for more information on upcoming events, register your interest below.

“How do I overcome burn-out? Will power corrupt? Why do I always face resistance? What is the difference between leadership and management? How will I excel at both? Where am I on my leadership journey?…

These are, of course, complex questions with complicated answers. Seeing and understanding the journey that leaders go through, however, can give you a map to see where you and your team members are, and how to address the challenges you face. This holistic framework empowers you to move forward confidently.”

The above was an extract from my Masterclass session: The Leadership Energy Journey shared at the 8th Leadership Energy Summit Asia on November 19, 2020. LESA is our annual leadership conference hosted by the Iclif Executive Education Center at Asia School of Business. This year’s virtual setup drew close to ten thousand attendees from across the globe. Each of the Masterclasses were a 30-min showcase of ASB faculty’s research focus.

I was nervous, to say the least. This would be the first time I spoke globally about this novel leadership framework, since the publication of my book The Leadership Journey (2018) in Thailand. In fact, the nerves persisted until I received my session’s feedback from Serena yesterday. The comments in that report put me at ease.

“Very true what Dr Thun shared.”
“Such a good presentation to check where are we heading to and keep focused on it.”
“Very practical session. I believe the Leadership Energy Journey is crucial and critical for an individual or an organization to excel further. Awesome presentation.”
“Great session! Wished the session to be longer so that we’ll have interaction on this interesting topic. Thanks!”
“HR should bring this course to conduct for our leaders.”

In this piece, I share with you some key ideas from that session so that you can judge for yourself. Is leadership an art? Or science? Or both? Well, leadership may be an art. But energy is a very scientific term. Like Einstein said, everything in the universe is energy. It is the smallest common denominator that ties all things together. Thus, leadership is also about energy – and a leader’s job is to use it to create a better future.

Leadership is the art of harnessing human energy to create a better future. Mankind has studied energy for thousands of years; with observations noted; experiments conducted; hypotheses tested, and laws written. Given that Iclif’s leadership definition draws a linkage between the two, I thought it would be useful to look at the art of leadership through the lens of energy science.

One property of energy is flow. Electricity flows through circuits causing the voltage that powers your light bulb. Water flows through rivers and streams to create currents. Wind is cool air flowing low to replace the hotter air that rises. My doctoral thesis was on the flow of electrons from the food we eat to the energy we have to do things – a flow of chemical to physical energy.

The laws of energy themselves are also a flow: energy converts → energy releases → energy stops.

From Laws of Energy to Leadership Energy Journey

Humans have been leveraging this flow of energy to create useful work since our first days. From the beginning, we hunted the physically superior mammoth by dropping it off a cliff – converting gravitational to mechanical energy. We made our evolutionary leap by burning wood to make fire – converting chemical energy into heat. Then, we used the steam-turned turbines to generate electricity – converting pressure into electrical energy.

Decades ago we even learned how to split the hidden potential within atoms to release nuclear energy. And recently, humans have been investing in more sustainable energy conversions such as solar and wind. What if we were to view leadership as a flow of energy, too? Could there be a useful relationship to help us in making the most of our own potential?

The Leadership Energy Journey is a pathway that overlays the scientific concepts of energy onto the art of leadership. It guides leaders to navigate their flow of energy to create the most useful output and sustain its longevity. The journey is made up of 8 key mileposts:

The journey and these mileposts follow, literally, the natural process of how energy converts. It is the same overarching process that we would go about designing a battery or building a dam. A tree growing in the forest channels its energy through the same route. Chemical reactions in our body help us to extract energy from food in this similar manner.

The laws of energy have been proven to be universal to all things on earth. Thus, the Leadership Energy Journey is not simply an artificial collection of items leaders should do. It is the governing path that science has uncovered for years regarding how energy flows.

Allow me to give a broad understanding of these mileposts. For those with an appetite for practicality and action items, I also highlight the corresponding Executive Education courses of Iclif@ASB where you can build your respective skillsets for that step of the journey.

Milepost 1: Start Now! discusses the fundamental nature of our brain – It is lazy. The brain is an organ that evolves to fill certain roles for the body, much like the heart, the lungs, the legs, etc. Its mandate is to keep the body alive. The brain’s functions, however, consume energy at a furious rate – approximately 20% of the total.

As such, its default mode is to conserve as much energy as possible in case a tiger, or a boss, walks by. Unfortunately, this also means that biologically speaking, the brain keeps us in ‘auto pilot’ mode whenever possible, which leads to complacency, hubris, and confirmation-bias, among other symptoms. This first step serves as an importance reminder that leadership is a choice.

Leaders need to be proactive about shifting the world, or at least their environment, towards a better future. Stories of popcorns, plane crashes, and failed business changes demonstrate the neuroscience of our comfort zone in the program Brain-BASEd Leadership: The Neuroscience of Personal and Organizational Agility.

Milepost 2: Discover Who You Are discusses the meaning of leadership ‘potential’. In science, the term potential refers to a ‘difference’ of states. The apple that hung high on its branch had more potential than after it had fallen on Newton’s head. A raised hammer has more potential than one that sits on the floor thus it could be used to drive the nail. Hydrogen and oxygen have higher potentials so when water forms heat is given off.

The ability for energy to do useful work arises from the dissipation of such potential. Similarly, to build up our leadership potential we need to create a difference of states. Leaders do this by driving apart the ‘present’ and the ‘future’. The greater the gap between how one perceives the current world and the future possibilities, the greater one’s leadership potential.

This step stretches our integrative thinking between art and science. The linkage between leadership energy and one’s values & purpose was described at length in Iclif’s previous two books Too Many Bosses Too Few Leaders (2013) and Open Source Leadership (2017) by Rajeev Peshawaria. Leaders are encouraged to introspect, visualize, and even verbalize their two states. The program Leading Self and Others offers support to facilitate this uphill climb part of the journey.

Milepost 3: Cross the Activation Barrier introduces the concept of the ‘activation barrier’. This is a rather interesting phenomenon that basically says: it takes energy to release energy. All changes in life require an input of energy to unleash. Newton’s apple needed a gust of wind to push it off the stem before it could accelerate towards the ground. A gun needs its trigger squeezed before the bullet can fly out of the barrel.

Even lighting a fire requires the striking of a match to get the initial spark going. In leadership, we see similar observations. All changes are faced with resistance, and all leaders must persevere over these activation barriers before a chain reaction of productive output can be generated. Unfortunately, many fail to lead because they give up before the floodgates can be opened.

This step is about helping leaders to release their leadership energy. Being able to reframe challenges as not resistance but rather an opening of a gate is already a helpful mental model for aspiring leaders. Our Emerging Leaders immersion program can be a great catalyst (an agency that helps lower the activation barrier) for developing leaders to overcome this barrier.

The 3.5-day residential program also allows participants to build their leadership resonance (having others to reinforce your potential) and leadership fusion (a process of unleashing the power within).

Milepost 4: Feel the Energy Flow describes the first downhill portion of the journey. When the built-up potential is released, energy transfers. Think of a dam that lets go of its water; you see the earth-shattering power that is set free. Once we have clarified our values, found our purpose, and overcome our activation barrier; the released energy will make us feel energized, unburdened, and free.

When your leadership potential is triggered, the released energy may literally overwhelm your physical capability. Have you ever experienced a blast of ideas and were frustrated by your fingers not keeping up? Or have you ever been so determined to make a point that your mouth couldn’t form words fast enough? These are situations when your energy is being released at a furious rate; analogous to the dam breaking.

This step focuses on leaders recognizing and controlling the freedom that comes with this release of energy. The program Managing by Freedom Within the Framework addresses this core question: How much freedom is productive? Can you give your people freedom while avoiding unnecessary risks?

When might you be operating outside the safe zone? This course introduces the leadership tools necessary for allowing an appropriate degree of freedom. The content is especially useful when managing younger leaders who are generally very driven by their sense of autonomy, passion, and energy.

Milepost 5: Channel Towards Usefulness is when leadership skills begin a transition towards management skills. Energy itself is value-neutral and having it doesn’t always equate to being productive. Have you ever seen energy spent on tasks that are not useful? For example, when office gossip is so tempting you’re your people are unable to pull themselves away to finish that (much more important) marketing plan.

Or giving the first impulsive answer that comes to mind when an unexpected problem arises, only to regret it later. Or even filling our lives with urgent tasks while postponing less time-critical yet supremely more important matters such as family and health. Or avoiding a personal confrontation, even knowing that delaying this will have a negative impact on the team.

The root of each of these situations is the same – it reflects on how well individuals channel their energy.  As a leader, you don’t just manage your own energy; you are also responsible for managing the energy of each member of your team. This step is where much of the people management capabilities are discussed. Managing Performance, Strategic Mindset, Catalytic Conversations, and our Coaching are some of the skills in which leaders must be well-versed to help their team to achieve its goals. 

Managing Performance addresses managerial components that enable people to perform well. Strategic Mindset builds the ability to envision a desired future and to plan towards it. Catalytic Conversations keep people focused on what matters with accountability. And Coaching empowers your team members with the capability to take charge of their own destiny.

  1. Milepost 6: Celebrate Success is about cherishing our accomplishments. On the Leadership Energy Journey, there are two ‘viewpoints’ where you should feel joyful:
    at the end of Milepost 2 when you have discovered who you are through achieving clarity on your values and purpose; and
  2. here at Milepost 6 where your work and efforts are paying off. At these two stops, you should feel a different sense of pride – the first from an internal realization that you have uncovered your core, and the second from recognizing your leadership output. As a leader, you must make sure your team members feel that sense of celebration, too.

A program that is useful to reiterate this step is Innovating Inside-Out: Becoming the 1%. Nothing provides a sense of accomplishment like being able to create something new that contributes to a better future. In the open source era, the barrier to innovation has been drastically lowered.

Everyone can be significantly better and faster at innovating. Appreciating how innovation has changed in the 21st Century, the Innovating Inside-Out session aims to challenge the outside-in organizational approach to innovation. Instead of looking externally for the next best ideas, this course ignites and grows the inner innovator DNA from within, and with it that intrinsic sense of pride.

Milepost 7: Replenish the Energy discusses ways in which leaders can restore their leadership energy. In this fast-paced, high-demand world, many leaders are too busy with busi-ness. Exercise is a great way to replenish energy. Dr. John Medina, author of Brain Rules: 12 Principles for Surviving and Thriving at Work, Home, and School described a 17% performance increase when college students used the treadmill for 40 minutes before taking exams.

Moving around is good for thinking as more blood is supplied to the brain. Interestingly, humans in modern times make most important decisions sitting down. Sleeping is also another powerful technique to recharge. The Federal Aviation Administration requires that pilots have eight hours of uninterrupted sleep in between their eight-hour shifts. In 2011, new regulations for medical residents went into effect limiting work hours to ensure that doctors get enough sleep.

Eating breakfast, short meditation routines, mindfulness in the workplace, and stress management are more examples of practical actions being taken to help leaders restore their energy. When designing a leadership development for clients, we make sure to include components that allow the participants to replenish their leadership energy.

Sometimes it is a physical replenishment; like morning activities or mindfulness practices. Sometimes it is an affect replenishment; like being on a new adventure together with your friends. Even an intellectual replenishment helps to sharpen one’s saw; like attending our annual Leadership Energy Summit Asia where global speakers are brought together to stimulate your leadership energy.

Milepost 8: What’s Next? is the last but perhaps the most important milepost. It reveals that the Leadership Energy Journey is not linear but rather a continuous loop. While that final summit is the better future, a leader can only try to progress as far as possible towards it – one goal at a time. Sustainability is about the relentless push to keep moving.

Take the life cycle of water: rain falls on the mountains; it collects into streams, rivers, then oceans; the water evaporates back into the air and condenses into rain and the process starts over. Or take a simplified life cycle of retail banks: money comes in via deposit; it is reinvested via loans to customers; projects generate profits that come back as more deposits and the loop propagates.

The leadership energy journey is the same; beyond the hill climbed there is the next one – hopefully each time becoming a little bit better. There are two kinds of people in the world: those who cannot wait for retirement and those who never retire. In this case, the latter have figured out how to sustain their leadership energy by recognizing the infinite loop, and learning how to ride its flow.

If you are interested in becoming one of these, or to learn where you are and how to overcome the current barriers, while figuring out what your next steps towards the future might be, you’ll want to be part of our Leadership Energy Journey: Deciphering Secrets of Long-Lasting Success at the next calendar event.

I hope to walk this very enlightening journey with you. Till then, stay safe and lead well.

Dr Thun Thamrongnawasawat (Tan) is one of the foremost experts on dissecting complex management and business models and cascading them for easy implementation by companies across different industries. His innovative B.A.S.E. model has inspired numerous organizations to transform.

He’s the author of the Brain-BASEd Leadership book series (2013-2016), a bestselling The Leadership Journey (2018) and a regular newspaper columnist. In 2015, Dr Thun was the recipient of World HRD Congress’s “Global Coaching Leadership Award” and named “Consultant of the Year” by the Ministry of Industry, Thailand. He can be contacted at thun@asb.edu.my.

If you are interested to know more about our exciting Executive Education program click here.

Having been a leadership coach and consultant over the years, I have had many opportunities to be a part of organizational changes. In 2008, I was brought into a major family-turned-professional business to transform a top-down leadership model into a more decentralized approach. At the Kick-off session of this transformation initiative, the HR Senior Executive Vice President delivered her opening speech to the group of so-called Change Champions.

The speech lasted exactly one minute and consisted of exactly one slide. She said “As you know, the CEO wants a transformation. The organization needs to change, and you are the people selected to help lead this. Good luck and I’ll see you in 6 months”. The slide that accompanied her speech was a scan of the memo letter released by the Office of the President.

The texts were far too small to be legible, but you could make out the list of names and the CEO’s signature at the bottom. The irony of transforming towards an inclusive leadership model was uncanny. The SEVP then turned to leave the stage. On her exit she stopped, as if an afterthought has occurred, and spun around to point at me, “By the way this is Dr Tan. He is here to guide you all through the process. Best of luck. Everyone is counting on you!”.

I stood there with the mic in my hand. The room was silent. You could hear a pin drop. All thirty pairs of eyes were fixed on me. I started that session in a way I had never done before. I skipped my introduction, the objectives, the deliverables, the timelines; I skipped everything and started by asking these employees in the room, “How do you feel? Right now, give me one word on how you are feeling”. I then passed the microphone around for each to speak.

What do you think were the feeling words we heard that day? Positive or Negative? “Scared”, “Sad”, “Confused”, “Angry”, “Lost”, “Frustrated”, “Blurred”… one person said, “I have no feeling…” before adding a qualifier, “…this happens every time”. All thirty replies and not a single positive word. To think that this might be how most organizational changes start.

As an Asia School of Business (ASB) faculty, I’m going through the process called International Faculty Fellowship (IFF) with MIT Sloan. A part of that is my choosing to take an online Exec Ed course with Professor Deborah Ancona, who heads up the MIT Leadership Center. She will also be my IFF advisor. This self-paced course title is ‘Leadership in An Exponentially Changing World’.

The course centers on Sloan’s leadership model called 4-CAPS+ developed by Professor Ancona and her MIT colleagues, Thomas Malone, Wanda Orlikowski, and Peter Senge. They combined their collective learning, research, and experience to identify key leadership capabilities that underpin success: namely, 1) SENSEMAKING, 2) RELATING, 3) VISIONING, and 4) INVENTING plus an anchoring node called BUILDING CREDIBILITY. Each module is further elaborated with sub-dimensions.

Figure 1: The 4-CAPS+ model (executive.mit.edu)

For example, the story I shared above was my first true experience with what I now understand through the 4-CAPS+ model as Sensemaking and its four sub-dimensions. It starts with the importance of approaching a situation, especially ones with high sensitivity and volatility like driving change, with Open Mindedness. Such mental model would then lead to our Learning From Others, like I did that day about people’s true feelings as the team faced their challenging mandate.

From that point onward, we were able to work as a team to Creating Meaning from Uncertainty by agreeing that, while change may scare us, there are things that we can influence and control. The team together crafted our own vision of the change and a list of initiatives that we would Experiment.

With the recent integration of Iclif and the Asia School of Business, I tried to apply the 4-CAPS+ model to our post-merger challenges during Covid-19 time.

  1. SENSEMAKING – Each side of the integration needs to discuss their respective signatures in honesty and without prejudice. We must put on the single-organization hat and approach this challenge with a growth-mindset. Perhaps we could do a workshop on aligning our new culture, with an emphasis on showing vulnerability and honesty to create more trust amongst the current members.
  1. RELATING – Given Covid-19 and the restrictions (Malaysia is under our 3rd wave and currently under restricted movement control), it surely doesn’t help for people on each side of the integration to work from home and not be able to be with each other. Hopefully this ends soon, and as we all move into the new office, relationship amongst us improves and helps our mutual understanding of others.
  2. VISIONING – The business unit has operated since the integration without a Head, who left at the beginning of 2020. While the CEO has stepped in as an interim leader, he could only do so much. One promising news is that a dedicated head of the business unit has recently been brought on board. The vision would then be expected to get re-clarified and we can move forward towards a common goal again.
  3. INVENTING – Looking at the S curve of Executive Education and Higher Education as a whole, there is no denying that a new ‘log’ phase must soon be realized. Covid-19 has greatly impacted our classic business model, as physical learnings were all replaced by digital interfaces. The good news is, with our integration, the ASB umbrella is poised to offer a holistic solution that few in the industry can. There is great hope ahead, provided we can learn to work together synergistically.

+ BUILDING CREDIBILITY – For me this really is the key to the whole challenge. We need to readdress and have real conversations on our values, purpose, behaviors, management structures & processes, strategy, and performance.

Only when we realize that everything we do, individually and organizationally, all contributes towards our internal and external credibility, and we make the efforts to align these critical components, will ASB be able to establish our unique value proposition to the market and achieve sustainable success. What about your challenges? Given Covid-19 and the ‘New Normal’, how can you apply the MIT 4-CAPS+ leadership model at your organization?

Reference:

Ancona Deborah, Thomas W. Malone, Wanda J. Orlikowski, and Peter M. Senge. 2007. “In Praise of The Incomplete Leader.” Harvard Business Review, February, 2007.

Dr Thun Thamrongnawasawat (Tan) is one of the foremost experts on dissecting complex management and business models and cascading them for easy implementation by companies across different industries. His innovative B.A.S.E. model has inspired numerous organizations to transform.

He’s the author of the Brain-BASEd Leadership book series (2013-2016), a bestselling The Leadership Journey (2018) and a regular newspaper columnist. In 2015, Dr Thun was the recipient of World HRD Congress’s “Global Coaching Leadership Award” and named “Consultant of the Year” by the Ministry of Industry, Thailand.

He can be contacted at thun@asb.edu.my.

If you are interested to know more about our exciting Executive Education program click here.

I am asked many, many times, as a professor and public speaker, what skills do I think people need today to develop the most. Do we all need to learn AI, coding, bitcoins, finance? Or do we need to work on communication, negotiation, managing people, etc.

At ASB we think believe that “Enough with ‘Soft’ and ‘Hard’ Skills—Let’s Get Smart and Sharp Instead” and we challenge the traditional terminology of “soft and hard” skills and replaced it instead with “smart” and “sharp” skills, along with a pedagogical change to reflect the linguistic change. I think of “smart” skills as the skills one needs to successfully navigate through life. At ASB, smart skills are those that require our students to respond to situations and challenges with intelligence and diplomacy.

They include, among others, creative and critical thinking, emotional maturity and empathy, cognitive readiness, social intelligence, adaptability, ethical and cultural awareness, self-awareness, personal discipline, a global mindset, collaboration and team work (from brainstorming to execution), knowing when to listen, validation, humility, entrepreneurial mindset, followership, humility, flexibility, willingness to learn, innovation, open mindedness, creativity, dependability, managing up, down and across, networking, etc.

The “sharp” skills comprise technical capabilities such as data analytics, optimization, risk assessment, system dynamics, and machine learning, for example. And my goal as an academic leader to teach these skills, along with my colleagues, in practice as well as in theory. So without further ado, here are the “smart” skills that I look for most when I hire or work with someone, and the skills that I want my #ASB students to develop along with their “sharp” skills.

  1. Emotional Maturity = “refers to your ability to understand, and manage your emotions”. You have heard me say over and over again in my talks or masterclasses: “The Job is Easy, The People are Not” and the reason why is partially because of our abilities to manage our emotions both in a professional and personal setting.
  1. Validation = “the ability to provide recognition or affirmation that a person (including yourself) or their feelings or opinions are valid or worthwhile”. Oprah said that we all need it (validation) and I learnt that the hard way! Also, goes back to “The Job is Easy”…
  1. Knowing When to Listen = “the ability to focus completely on the person/s speaking, understand their message, comprehend the information and respond thoughtfully.” I ask my students to listen more, to focus on the problem before they focus on the solution. And I know I need to work on this too! Again, the Job is Easy, if the People are too!
  1. Followership = “the capacity or willingness to follow a leader.” My mental model of following a leader comes from Star Trek Next Generation (how else) between Captain Picard and “Number One” Will Riker. Riker disagrees with Picard but only privately, and in public, he is his Captain biggest supporter.
  1. Managing Up =
    Classic Definition – Managing up is about developing a good working relationship with a superior.
    Modern Definition – Managing up is solving problems that your stakeholders need solved.Are you a difficult boss? I am, because I expect everything I asked for and some change. And that doesn’t make me popular with many. But it turns out that for most of us, if you know how to solve the problems of your stakeholders in the way they want it solve (and some change), you will become hard to replace. I give a masterclass on Managing up in executive education at ASB. Ask me more…
  1. Humility =  “to recognize your value and others value while looking up. It is to see there is far greater than ourself into who we can become, who others can become, and how much more we can do and be.” Our ASB President, MIT Sloan Prof. Charlie Fine says: the world is full of smart and arrogant people out there. I wanna work with the smart and humbled ones. The truth is that the ability to be humble is a practice. I learnt that “the more i know the less i know” and also, that arrogance and ignorance are best of friends. So you wanna become more humble? Learn more so you realize how little you know!
  1. Adaptability = “an ability or willingness to change in order to suit different conditions”. One of my favorite fields of knowledge is evolution and like Darwin said, the only species who survive are the fast and adaptable ones (have you seen any dinosaurs lately?) Same with the humans. Professionals with strong adaptability skills will make it. The rest are probably going to spend their time in Jurassic Park 😉
  1. Cultural and Ethical Literacy = “the competence and knowledge of understanding of the differences between yourself and people from other countries/backgrounds/race/religion, especially differences in attitudes and values” and “the willingness and ability to identify moral and ethical contexts and dilemmas“. And because of the global expansion of the workforce, there was never a better time in our history when these 2 critical smart skills were more needed.
  1. Strategic and Critical Thinking = “the process of conceptualizing applying, analyzing, synthesizing, and evaluating information to reach a goal, and have a plan for execution”. Every time I ask an employer about what skill they value the most, strategic and critical thinking come on top. Obviously, right? This smart skill empowers you to solve complex problems in the absence of a blueprint and SOPs.
  2. Cognitive Readiness = “the mental preparation (including skills, knowledge, abilities, motivations, and personal dispositions) that a person needs to establish and sustain competent performance in our complex and unpredictable environment”. This is a hard one and that’s why I left it for the end… Leaders and their teams, have to be constantly prepared to face ongoing dynamics, ill-defined, and unpredictable challenges in the digital, highly disruptive and VUCA-driven business environment. I also run a Master class on this if you wanna know more.

So now the question is how you manage to build up all these skills? There is a complicated answer (which probably requires a book) but for me, the simple answer is constant Action Learning, Learning in Action and Reflection. Just what we do here at ASB!

If you are interested to know more about our Action Learning click here.

Humankind has made huge strides in technology. Big data and data analytics, artificial intelligence, machine learning and deep learning are being used in various daily applications and industries. But when it comes to retirement schemes, we appear to be stuck in the past.

The leading solution that private retirement planners have come up with is a spectrum of well-diversified risk/return investment portfolios drawn from 1950s financial technology, or at best a series of target date funds, where risk-taking follows a predefined ‘glidepath’. A recent innovation has been the enabling of the same solutions at lower cost using technology, or robo advisers. Surely we can do better.

Read the full article here.
This article was originally published on Asia Asset Management

Prof. Ong Shien Jin is a Professor of Practice at the Asia School of Business (ASB). His research interests are in Finance & Analytics. Shien Jin’s background spans finance, tech & academia. He started his career as a Quantitative Strategist at Goldman Sachs Asset Management Fixed Income, specializing in mortgage-backed securities.

After Goldman Sachs, he joined the tech industry as Special Assistant to the CEO at JobStreet.com, the #1 online job portal in South-East Asia. Prior to ASB, he was a Visiting Senior Research Fellow at the National University of Singapore (NUS). Shien Jin holds a PhD in Computer Science from Harvard University and a Bachelor of Science in Mathematics from MIT.

He can be contacted at shienjin.ong@asb.edu.my.

“If you’ve been doing the same thing for more than 2 years, then you might as well be in a coma”

Dr David Rock, the founder of the Neuroleadership Institute, an integrated field that merges hard science with soft skills of leadership, stated during the American Society for Training and Development (Now known as ATD) one summer in Florida. What did he mean? Let me tell you a story about an intriguing experiment out of the University of Southern California, which was published in the journal Personality and Social Psychology Bulletin in 2011.

The experiment was about popcorn and the people who eat them. That’s right, popcorn – like the ones you find at movie theatres. The researchers focused on two groups of moviegoers; ones who regularly enjoyed these delicious treats and the others who rarely ate them. Let us call these popcorn personalities 1) the “Yes, please” and 2) the “No, thanks”.

The groups were tagged and then offered some popcorn during their movie going experience. In the bucket, researchers put in two types of popcorn. One was freshly popped and another was about a week old. The mix was handed to both groups. And the organizers then sat back and waited to see what would happen.

What do you think?

From my own survey with participants in the room, most people think that the “Yes, please” group would only go for the fresh popcorn. After all, these were ‘professional’ popcorn eaters so they should know what they were doing, right? Perhaps it was the same logic that an employee who has been doing a job for many years should know it more than anyone else?

That’s what I had thought, too. The results of this experiment, however, showed otherwise. It turned out that people who were ‘smart’ about selecting fresh popcorn were instead the “No, thanks” group. The “Yes, please” were indifferent of new vs. stale popcorn. They would eat them both! Truly intriguing was when experimenters asked the “Yes, please” group to repeat the task; only this time its members were asked to use their non-dominant hand.

That’s right, to use only their non-dominant hand. If they were right-handed, then they had to use their left hand to pick up the popcorn. If they were left-handed, like me, then it was the right hand. Amazingly the results flipped. The “Yes, please” group now exhibited selective behavior for fresh popcorn just like the “No, thanks” group. Forcing them to do what they were not accustomed appeared to restore awareness. Their brain can now distinguish between what is good and what is bad.

What to make of these results?

Leadership Insights

The brain operates in ‘economy mode’. In simple terms, our brain is frugal. The brain tries to find the most energy-efficient path to get its desired output. When the brain learns something for the first time, it uses a lot of energy. Basically, it needs to think. However, doing the same repetitive work for a while the brain discovers that it can save a lot of energy by merely carrying out the act. This is what we know as habits, like locking your car, driving home, or taking a shower in the morning.

The myth about experience. Given the implication, is it always true that people with a lot of experience know the most? Our understanding of the brain might suggest otherwise. The experienced popcorn eaters relied on their habit more than their forebrain. They were not ‘thinking’ about eating the popcorn. It was not until they were asked to use their non-dominant hand that their brain was subsequently forced into an active mode. So, don’t just rely on the veterans in the team; bring in a fresh perspective – someone who asks ‘stupid questions’. Listen to them and see if they saw something the experienced may have missed.

Quint Studer, author of Hardwiring Excellence: Purpose, Worthwhile Work, Making a Difference, wrote about a practice at his hospitals called The-First-30-Days. After a month into the job, new employees are gathered to share what they have seen that seems ‘strange’. It could be as complex as an MRI preparation procedure he/she used at the prior workplace. Or as simple as “I was wondering why the microwave here took so long to heat up our food”. The rule is everyone else can only listen. No explanations or rebuttal are allowed.

Quint explained that most organizations assume it is natural for seniors to mentor juniors. But valuable insights could be drawn from reversing the process as well – getting your houseguests to see what your home has been missing. By the way, the microwave catch was an actual example. The hospital improved their staffs’ return-to-work time after it placed a more powerful microwave in the pantry. This is an example of not becoming ‘popcorned’.

Lead you brain. If we do something repetitive for a while (like writing that marketing plan using the same excel template for 2-3 years consecutively), our brain switches off and operates in ‘economy’ mode – no thinking required. What the experiment also taught us, fortunately, was that we can do something about it. Don’t let your brain settle into repeating patterns. Come to work using different routes, disrupt the morning routines, allowing ideas you disagree with to take shape, read different types of books, volunteer for unconventional tasks, rearrange the office, start with a fresh template – the possibilities are endless.

Intriguing, isn’t it? This is yet another reason why organizations should actively develop leaders. Ask your people to experiment with their sense of urgency for change. Force their forebrain to look for ‘cracks in the iceberg’, as the leadership guru, Professor John P. Kotter would say. A Litmus Test: Is the first thing your people think of when getting to the office in the morning: “where to have lunch today?” If the answer is closer to ‘yes’, then there might be a red flag that everything else between breakfast and lunch has become habits.

Dr Rock concluded his session with this gem.

“Do your people actually have 20 years of experience, or simply a 2-year experience repeated ten times?”

Dr Thun Thamrongnawasawat (Tan) is one of the foremost experts on dissecting complex management and business models and cascading them for easy implementation by companies across different industries. His innovative B.A.S.E. model has inspired numerous organizations to transform. He’s the author of the Brain-BASEd Leadership book series (2013-2016), a bestselling The Leadership Journey (2018) and a regular newspaper columnist. In 2015, Dr Thun was the recipient of World HRD Congress’s “Global Coaching Leadership Award” and named “Consultant of the Year” by the Ministry of Industry, Thailand.

He can be contacted at thun@asb.edu.my.

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