Friday, December 26, 2008

...of privatisation and creative destruction?

Ya ya..we juz had Christmas holiday (to those who celebrates it), Monday 29th will be Awal Muharram holidays and January 1, 2009 will be another holiday. The office was rather quiet today but thank gawd, Razali Yubong texted me earlier this evening to let me know all the board papers have been delivered. Thank you Li, what would we do without you, man? I know it is holiday mood but I have this burning desire well it hasn't come to a stage of violent objection (not yet lar so far...can still bear with it leh? hehe) to debate..oh well, discuss about privatisation ( an intervention that was soo fashionable in the early 90s...).
I remember in 1993 when I attended the International Youth Council (IYC) meeting in Fukuoka with one of my former bosses, the late Dato' Abdul Malek Nahu (Malek Grammar as he was fondly referred to from time to time, then), Datuk Abd Wahab Adam (Secretary General of Youth & Sports Ministry at the time), Saifuddin abdullah (now a Datuk and Deputy Minister of Entrepreneurship & Cooperatives) and a few other government and NGO officials. Datuk Wahab was reading a book on the (orient express wannabe) train to Oita (about a 3 hour ride up the mountains). It was called "Reinventing the Government" by Gabler. Apparently all SecGens and top civil servants at the time was required oh well, recommended by the Prime Minister at the time (Tun Dr Mahathir) to read the book I was told. Essentially, Gabler's message was: there are things that are best left to market forces (laisse-faire) to encourage competition and thus achieve the desired efficiency and effectiveness and economies of scales...thus the deja vu and the obsession with corporatisation and it seems; Some other things must still be in the control of or best be in the hands of the Government (like basic health care, utilities and public transportation); and for a much more equitable wealth distribution, the cooperative would appear to be the best tool to use. Over time we have all seen the foibles, follies and both the functional and dysfunctional consequences of privatisation. It was not totally excellent in some areas and totally disastrous to0 in some others. I shall not elaborate. You can be the judge of that.
On December 15th recently, when I gave the keynote address at the 3rd International Borneo Business Conference (IBBC), I said that if you put 200 economists in a room, you will get 200 different opinions and strategies. They can all be right and they can all be wrong too. Prof Dr Kassim, Dean of School of Economics and Business of Universiti Malaysia Sabah in his summary, agreed with me (hehe). Sometimes I too get confused (haha). One moment I am Malthusian, another I am Keynesian (by the way, in the current global crisis...we are all Keynesians now! hahaha), at the same time I could also be a Milton Friedman convert (hehe). But I am also a fan of John Kay, Paul Romer, Krugman and Lester Thurow....see? The list is endless. We also see a hugh following of the works of Joseph Schumpeter and his famous 'creative destruction' theory. Some say he is the father of modern entrepreneurship. I suspect much of the argument for privatisation seems to have been motivated by his thinking.
There has been lots of debates, views, comments etc both in blogosphere and in mainstream medias about the privatisation of a certain medical entity (?). In management there is no right or all depends. Pledges, promises and objectives are but one thing, the outcome of the execution, implementation and as I said earlier, probable dysfuntional consequences, are another. It is not rocket science, to come out with the best justification in the world to go ahead with the intention (to privatise). The UK's NHS is 60 years this year. Perhaps we can learn from some of their good and bad experiences (which I suspect we may have) so that we can balance both the corporate and public sector objectives or end in mind as Covey always calls it in his 7 Habits Model (hehe) .... my 2 sen views.... It would be interesting to re-examine all the privatisation exercises over the last 10 to 15 years hehe. I do know of someone whose PhD thesis was on privatisation (heehee.. not sure if she is reading this blogpost though..hahaha)...My stand? I am not totally fond of privatisation. Sorry folks...if its a bit too long and heavy....enjoy the long weekend.

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