Malaysia and Innovation: Why Malaysia Will Become the Innovation Powerhouse of South East Asia
Wednesday, December 15, 2010 at 9:18PM
Ralph Kerle in Creative Leadership

The First Kuala Lumpur Innovation Forum designed and delivered by the Malaysian Foundation for Innovation was an excellent example of collaboration in a secular Islamic state where the common good of the country and its people and their spiritual health is considered tantamout rather than any drive for individual riches and freedoms at any cost.  Education, knowledge, understanding, experience and initiative dominated the topics of conversation not the rights and wrongs of a particular political ideology or philosophy.

In their new book Leading Innovasian launched at the event, the co-authors and Principal Consultants in Alpha Catalyst Consulting, Azim Pawanchik and Dr. Suraya Sulaiman offer insight as to why this is the case when they compare the culture of Asian innovation practice to the culture of Western innovation practice. They compare the importance of harmony in Asia, always trying to maintain harmonius relationships resulting in less likehood of challenge to existing boundaries to the Western notion of innovation that seeks to establish control over environments by challenging boundaries and beliefs.

They nominate hierachies as places in Asia where respect is shown for those in power as opposed to the Western notion of equality whereby everyone regards each other as equals. Relationships in Asia are more important and need to happen before the task gets done as opposed to the Western notion of just do it!

So it was against this cultural backdrop to launch the inaugural event that Y.B. Senator Dato’ Sri Idris Jala, Minister in the Prime Minister’s Department, gave a powerful presentation on the principles and purposes of innovation within the Malaysian public sector and how these ideals contribute to and support the Malaysian Government’s goal of developing an innovative society and a high income economy. 

The Minister in the Prime Minister’s Department in the Malaysian Government system is not an elected politician. Under the Federal Constitution of Malaysia, the Prime Minister is allowed to appoint two unelected officials to positions of ministrial authority reporting directly to him. In appointing Idris Jala, the former Managing Director of Malaysian Airlines, prior to that Managing Director, Shell Malaysia, the Government chose a person with experience, knowledge and an international track record in turnarounds within multi-national corporations to assist, co-ordinate and assess the government’s progress towards achieving the KPI’s set by the Prime Minister’s Government Transformation Programme launched in January 2010.

As part of the Transformation Programme, each ministry in Malaysia is required to establish specific KPIs that focus on policy outcomes over the traditional emphasis on inputs typically found in government performance assessments and planning. KPIs include detailed job descriptions and goals for ministers, deputy ministers, and some other senior government officials.There are six major policy areas in which KPIs play an important role in improving the effectiveness of the Malaysian government. These are known as National Key Result Areas (NKRAs). The NKRAs include crime prevention, reducing government corruption, increased access to quality education, improvements in the standard of living for low income groups, upgrades to rural infrastructure, and improvements in public transportation.

“I am not a politician” were Jala’s opening remarks as he proceeded to demonstrate a nuanced knowledge of the theories and practices of innovation, as good an understanding of this subject as I have come across globally by a senior leader, either government or corporate. and then offered a progress report on the KPI’s in well evidenced case studies.

Watching this presentation that almost took the form of an annual general meeting to his fellow countrymen and a sophisticated international audience of observers, I found myself reflecting sadly at the lack of genuine accountability, risk and innovation within the Australian public sector. Two years after The Cutler Report reviewed Australia's National Innovation System, Australia has achieved little of significance in public sector innovation because the report erroneously focused on developing a national system rather than innovation in the public sector, urgently needed to provide the support required to develop a national system in the first place.

When you compare the rhetoric of Australia’s Cutler Report on the National Innovation System to the successful construction and transparent practicality of the Malaysian Transformation Programme, you begin to understand why Malaysia is surging toward an economic powerhouse of innovation and Australia continues to be stuck in a bureacractic miasma of research on models, processes and things gone past with little forward action and outcome resulting.

Malaysian experience reveals innovation is built on action-driven practice and implementation with transparent oversight, not a risk adverse public sector bureaucracy. Idris Jala’s address showed the possibilities of a public sector when it is given a focus, a set of KPI's and made genuinely accountable publicly.

His address also set the tone for a series of lively and insightful keynotes, forums and presentations led by Malaysian leaders with local and global innovation leaders, in the process, painting a thought provoking picture of innovation and its potential for Malaysia.

Professor Dr. Mahendhiran Nair, Head, School of Business, Monash University, Sunway Campus, Kuala Lumpur mapped the existing Malaysian Innovation Ecologies and summarised their opportunities and challenges.

Under the title Innovation Meets Social Networks: Discovering Billion Dollar Industries ThroughInnovation – The Social Gaming Model, Entrepreneur and Group Chief Executive Officer of MOL Global and Friendster, Ganesh Kumar Bangah tracked the emergence of Malaysia as a global leader in the social gaming industry. He offered powerful insights into business models of the future where cash is exchanged for virtual goods.  Interestingly Bangah spoke about the failure of the initial government funded initiative set up to explore this opportunity and how its failure forced him and those involved to focus on the commercial, rather than the R&D.

Managing Director of the Malaysian Government’s invest arm Khazanah Nasional Berhad , Y.Bhg. Tan Sri Dato’ Azman bin Haji Mokhtar in "Building a More Effective Innovation Ecosystem"  set out clearly the thinking behind the Malaysian Government’s investment decisions in innovation initiatives.

Gernot Hutschenreiter Deputy Head, Country Studies and Outlook, OECD  presented  “Getting a Head Start on Tomorrow - The OECD Innovation Strategy “ a global perspective on innovation and its drivers and, in particular, the immediate challenge of finding new ways of benchmarking and measuring  innovation.  Eduardo Chakarian, Principal, Monitor Group, Singapore offered “Innovating In Asia” an all encompassing view on innovation culturally and economically and warned of the importance to countries of recognising how culture influences the way innovation works concluding on the question “What is the Malaysian Way For Innovation?”

A surprising presentation by Professor Dr Anthony J Sinskey, Professor of Microbiology, the Department of Biology and Professor of Health Sciences and Technology, the Harvard-M.I.T. Division Health Sciences and Technology explored the behaviors behind innovation in the sciences and academe in "Key Factors For Successful Scientific Innovation ". His stories of the vagaries and failures along the way, the exciting rush of new breakthroughs particularly in the area molecular biology as a result of technological advances and some tips on how to commercialise scientific breakthroughs whilst keeping the venture capitalists at bay was informative and funny.

A case study in the implementation of innovation “Ideas From Everyone: The Bank Rakyat Experience - Generating and converting ideas into something of value” by Mr. Saliman Bin Zainal, Manager, Personnel and Manpower Planning, Bank Rakyat revealed a highly sophisticated innovation strategy aimed at specifically growing the size and profitability of Bank Rakyat fueled by nothing more than employee's ideas and engagement. The result of a well thought out and constructed on-line creativity system, given time to fail and succeed by management, saw in the first year of implementation (2006) a profit before Zakat and Tax of RM626,000,000 with contributions of 600 new employee ideas for value converted into jn its 4th year (200) a profit before Zakat and tax of RM1,550,002,00 with contributions of 2500 new employee ideas of value ideas  – a remarkable testimony to great creative leadership and human resources management‼

I especially wish to thank Dato’ Ghazi Sheikh Ramli, Founder and President of the Malaysian Association for Creativity and Innovation (MACRI) and a member of the Creative Skills Training Council for proposing to the Malaysian Foundation For Innovation I might have something to offer with the Management Innovation Index and the Foundation for providing me the platform on which to launch the Index amongst this group of global innovation leaders.

Finally, a huge and long round of applause to the Malaysian Foundation for Innovation, the CEO Dr. Raslan Ahmad and his team.  The First Kuala Lumpur Innovation Forum was an outstanding success as an international innovation event and I can only recommend it as a must attend event if you wish to understand how and why innovation is steaming full speed ahead in South East Asia.


I am delighted to announce the Creative Leadership Forum has been able to reciprocate the Malaysian Foundation for Innovation’s kind hospitalty by facilitating the visit of its CEO Dr Raslan Ahmad as a special keynote speaker at the Australian Services Roundtable Summit on Services Innovation to be held in March 2011 at Parliament House in Canberra


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