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It is a sign of growth when countries start talking about raising the minimum wage. It demonstrates confidence in the resilience of the economy, and the need to prioritise the wellbeing of low-earning workers in the country. Malaysia had increased its minimum wage to RM1,200 earlier this year as part of a policy to address the country’s growing urban poverty and combat income inequality. However, it was met with outcry from some quarters who pointed out the lack of due warning and absence of a clear implementation programme for companies to adequately prepare themselves ahead of the wage hike. Others raised the issue that a RM100 increase was still not enough to cover basic expenses.
Malaysia is now under a different government, with a new Prime Minister at its helm. There is an opportunity here for the new administration to pick up where the former left off and turn the minimum wage increase into a positive and actionable policy. But first, it is important to understand the argument around minimum wage in its entirety, from its impact on the economy to how businesses can cope with the increase.
1. Why raise the minimum wage at all?
Setting a minimum wage protects workers against unduly low pay. It allows the government to set the terms of employment and working conditions. With the right policies in place, the minimum wage can be a tool for the government to overcome poverty and reduce income inequality.
Malaysia first set a minimum wage in 2013. This was done as part of a larger programme aimed at ensuring inclusivity and boosting the economy to high-income status. It was calculated based on a variety of factors: the poverty line, productivity growth, consumer price index, unemployment rate (actual, region), average wage per household and medium wage. At the time, the wage was estimated to benefit about 27% of workers nationwide.
By right, the minimum wage should reflect increases in the cost of living to ensure that workers can afford to buy basic necessities. However, the minimum wage has only been increased a couple of times since its introduction in 2013 – first in 2016 when it was raised to RM1,000 a month, to RM1,050 a month, and then to RM1,100 a month in 2019. This year would be the fourth time.
This mismatch between the minimum wage and rising cost of living has had the biggest impact on low-income households. Since 2014, the monthly income of the bottom 40% (B40) has grown by 5.8% annually – but after accounting for the increase in the cost of living, the growth is actually at around 3.8%. At the same time, household expenditure grew at a faster pace of 6%, leaving these households with very little money to spend.
In 2018, Bank Negara Malaysia (BNM) introduced the concept of a ‘living wage’. Defined as a wage level that could afford the minimum acceptable living standard, a living wage would allow individuals to sustain a decent standard of living beyond just the basic necessities such as food, clothing and shelter. It should also provide for personal and family development, social participation – such as occasionally being able to purchase gifts for family members – and financial security.
The report calculated the estimated living wage for Kuala Lumpur as follows:
- A single adult, renting a room and frequently using public transport, would require RM2,700 a month to maintain the minimum acceptable living standard in the city
- A couple with no children renting a one-bedroom apartment would require RM4,500 a month
- Families with two children would require RM6,500
Even with the RM100 increase, the current minimum wage of RM1,200 is still much lower than Bank Negara’s projected living wage.
To compare, the monthly income in 2016 for B40 households living in Kuala Lumpur was reported by the Statistics Department as RM5,344 – lower than the estimated living wage of RM6,500. This has made it challenging for such families to afford basic necessities, much less a home, car or other consumer goods, causing many to look for supplementary sources of income. More people are resorting to working two jobs or deriving income from a side business just to make ends meet, contributing to the rise of Malaysia’s gig economy.
Increasing the minimum wage can provide these communities with a safety-net, allowing them to afford more than just the absolute basic necessities. It is also important to ensure that the minimum wage stays relevant. This can be done by holding an annual review, checking the set wage against current cost of living and overall health of the economy, and make the appropriate adjustments.
2. How will the increase impact the economy?
The biggest risk raised is that the wage increase would be set too far above the rate that employers can afford to pay their employees, forcing them to lay off workers if they can’t offset that cost in some other way.
However, research suggests otherwise. Studies have found that increasing the minimum wage is often beneficial. The University of Washington has been studying the impact of raising the minimum wage in Seattle on its economy; a recent report shows that low-income workers were better off as a whole after the increase.
This is no different for developing countries. North Macedonia underwent a bold reform of its minimum wage system in 2017, increasing the minimum by 19% and introduced the same wage in all sectors. The International Labour Organisation (ILO) found that it was successful in reducing wage inequality without negative impact; after the reform, only 4.3% of wage earners were in the low wage category (compared to 14.7% before the reform), and the bottom 10% received a share of 4.6% of all wages in the country which is well above the European Union’s average of 3.6%.
One of the challenges ahead for the new government will be to revive the national economy. Malaysia is currently facing various threats, from the Covid-19 outbreak to international trade wars, and is coming off the back of a slow fourth quarter growth. This is compounded by the recent political uncertainty which has caused the Malaysian stock market to plummet. One way to spur the economy is by increasing purchasing power of the rakyat; this can be done by increasing wages and thus providing them with a little more disposable income. It could also boost overall purchasing power and contribute to household consumption.  Higher basic wages to the low wage earners could boost the income of small- and micro-businesses in Malaysia. Even modest rises in the national minimum wage could make a big difference to disposable income.
3. What does this mean for businesses?
A gradual increase in minimum wage provides the opportunity for business leaders to review their operations and make the necessary adjustments or optimisation to balance the higher cost of employment. It may even stimulate a larger transformation in the organisation’s strategy or operations that will make their business stronger in the long run.
For businesses that might be impacted by the raise, preparation is key. Here are some ways they can ready themselves:
- Figure out how much the increase is going to cost – Are there business expenses that can be reduced? Is the budget flexible enough to accommodate redistribution of funds? A segmented P&L exercise can help companies determine at a very granular level which areas are making a loss, and which are turning a profit. This will enable companies to see if they can accommodate a minimum wage increase.
- Look for ways to increase productivity – Is the business being as efficient as possible? Are there areas that can be improved? Setting a strategic direction and ruthlessly prioritising the most productive and efficient initiatives will help to ensure greater focus overall and maximise the trend and speed of delivery. Set key performance indicators and monitor them religiously to ensure that progress is being done.
- Leverage on technology –What manual activities in the day-to-day operations can be automated? Are there any processes that can be upgraded by using new technological innovations? The idea here is to use technology not just to replicate an existing service in digital form but to transform that service into something significantly better.
A minimum wage increase isn’t a death sentence for businesses. Rather, it can be an opportunity for companies to transform their organisation into one that is agile, productive and digitally-forward.
4. How can the government manage the shock to the economy?
When the RM1,200 minimum wage was first announced late last year, businesses were taken by surprise by the increase and resistant to any change to the minimum wage. Representing one of the major industries in Malaysia, the Federation of Malaysian Manufacturers has stated that the industry is not against the increase in the minimum wage, but there should be a “clear and certain roadmap for the phases of increase, including the areas of coverage, to provide clarity and certainty to the business community for their respective budgeting and planning purposes”.
As with any socio-economic policy, it is important that both the public and the private sectors are aware ahead of time about what is being planned and how it would be rolled out, as well as any support that would be available to ease its implementation. This could be done by publishing a public roadmap, followed by an annual review of its implementation and effectiveness.
To raise or not to raise?
Over 20% of Malaysian households earn below the relative poverty line. Increasing the minimum wage – perhaps even to over RM1,200 – is a good idea and one that has the potential to help a lot of B40 communities. However, any increases to the minimum wage should be done gradually and openly.
Much of the resistance to raising the minimum wage was due to the suddenness and perceived lack of planning on a key socio-economic issue as opposed to the increase itself. A clear implementation plan, with a condition to review the set minimum wage each year to ensure its relevance given the current economic landscape, would help to clarify the issue and let the public know what to expect.
This is an opportunity for the new administration to take the lead on a popular issue and work together with both businesses and unions to deliver a truly transformative policy.
 International Labour Organisation (ILO), 2020  ‘The Living Wage: beyond making ends meet’, Bank Negara Malaysia, 2018  New Straits Times, 2018  ‘The Living Wage: beyond making ends meet’, Bank Negara Malaysia, 2018  The Star, 2019.  Ibid.  Evans School of Public Policy & Governance, 2020  ILO, 2019  The Edge Markets, 2019  The Edge Markets, 2020  The Star, 2019
A guide for a new Prime Minister to deliver on his pledge
Having gone under a tremendous level of political, social and economic strain lately, Malaysia and its new government will need to robustly review the national agenda set after GE14, the policies that were implemented, programmes that were previously scrapped and measures that had been put in place since the transition of power – two times over.
The task of governing and implementing the right public policies, while not an easy task to begin with, is doable. What the new Prime Minister, YAB Tan Sri Dato’ Muhyiddin Yassin requires is an astute list of prioritised initiatives that can be implemented by our able civil service to steer our socio-economic landscape towards the right horizon. Having stepped up to the mantle, he now needs to regain the trust and belief of Malaysians that he, as Malaysia’s 8th Prime Minister, can deliver.
I urge you to support me to undertake this huge responsibility entrusted on me. Give me a chance to utilise my 40 years of experience in politics and government. I give you my heart and soul.
Give me some time to outline a path under this new administration which I will explain to the people as soon as possible.”
Unfortunately, time is a premium rarely accorded to politicians. The new Cabinet of 32 Ministers and 38 deputies has just been formed – there’s even more pressure now to hit the ground running and live up to the Prime Minister’s promise of forming “a Cabinet that can really give the best service to the people, a cabinet that delivers.”
Here are the top five possible initiatives vis á vis his pledges that he should immediately focus on, in no particular order.
Your To-Do List, Mr Prime Minister
1. “The priority is to increase administrative integrity and management. Fight corruption and abuse of power.”
It is unfortunate that the first week of YAB Tan Sri Dato’ Muhyiddin Yassin’s administration has been fraught with two back-to-back resignations. One from the Attorney General (AG) and the other, the MACC Chief Commissioner. Both posts are integral to instilling administrative integrity, fighting corruption and abuse of power. They have since been filled; Idris Harun is the new AG and Azam Baki has been named the new MACC Chief Commissioner. We can only hope that they will be uncompromising and tireless individuals with a record of advocating against corrupt practices, irrespective of the position or political allegiance of the perpetrators.
2. “I also know what people want is a government that is sensitive and efficient in solving the people’s problems and have the means to meet their daily needs”
The Prime Minister has appointed his cabinet. They should collectively take lessons learnt from the previous administration. Some may not be popular. Some may be a surprise. Some may be begrudgingly accepted by the rakyat. More critically, many Malaysians are expecting them to deliver regardless of party affiliation and hoping that they did not come to power for the sake of assuming power. Because the Prime Minister will need such individuals to help him combat the trust deficit that existed prior to GE14.
3. “I also know the need for quality healthcare services at affordable cost”
This noble pledge is far more complex than it seems. With the Covid-19 Outbreak, the Prime Minister has his work cut out for him. There is an immediate need to stabilise and protect the health of the rakyat before Covid-19 becomes a pandemic.
The Ministry of Health has the second-highest number of civil servants with the second-highest budget allocation in Budget 2020. This was to ensure that Malaysia’s public healthcare industry could keep up with new advances in technology, facilities and outbreaks of undesired viruses.
In a recent article by Dr. Khor Swee Kheng, he offered useful and valid suggestions to the new Prime Minister that the time may well have come for him to consider the unprecedented motion of appointing specialised technocrats who are results-driven, non-partisan and non-ideological to the Ministry of Health.
4. “With my six-year experience as Education Minister, I promise to strengthen the country’s quality of education. I will ensure our children will receive an education which standards are on par with developed nations”
During his term as the Education Minister, YAB Tan Sri Dato’ Muhyiddin Yassin had stepped up, defied critics and went against the grain to implement the dual language programme (DLP). While the use of English in Malaysian schools has always been a subject of debate, the DLP was implemented to preserve the use of Bahasa Malaysia while ensuring that the population’s grasp of the English language continues to improve. English by far is still the language of commerce and communication around the world. While there is continued pushbacks from certain quarters, their criticisms shouldn’t be allowed to jeopardise the aspirations of parents who wish to have their children be proficient in English but may not have the resources to send their children to private or international schools.
Studies have shown that 15% of rural students exposed to DLP (compared to 2% without DLP) reached intermediate English proficiency, and on the other end of the spectrum, only 4% of DLP students (compared to 25% without DLP) fell below the basic proficiency target at the end of preschool. Many teachers have noted that the DLP was able to capture students’ interests in STEM subjects and prepare them for future careers in those fields.
Mohd Radzi Md Jidin has been named as Minister of Education in YAB Tan Sri Dato’ Muhyiddin Yassin’s new cabinet. We hope he will continue his Prime Minister’s good work in paving the way towards improving Malaysian’s English proficiency.
5. “I am a brother to the Malays, the Chinese, the Indians, the Sikhs, the Ibans, the Kadazans, the Dusun, the Murut and those of various ethnicities. I am your Prime Minister. Even if you are a farmer, a fisherman, a trader, a civil servant or a private sector employer, I am your Prime Minister.”
For too long, populist statements of such nature have become standard inclusions into a politician’s manifesto without bearing the conviction and necessary will to come down hard on those who readily play the racial card and assume bigotry. Too often we promote the ideals for Malaysians to be seen as one. Too often we speak of embracing our diversity. Too often we claim that this diversity makes us collectively great, and that we will become a society that will prosper and progress together.
But it is glaringly obvious, that some have not received the memo. If indeed, we aspire for a better Malaysia for our children and our children’s children, then this new leadership needs to start walking the talk.
The rakyat was promised a repeal of draconian acts or laws as part of Pakatan Harapan’s winning political manifesto. This has not quite happened. But why go so far as to enact a law and then find ways to repeal it, when Malaysia already has the well-established Rukun Negara developed and enshrined 50 years ago?
The Rukun Negara has two parts. The first, a pledge that reads,
“Whereby Our Country, Malaysia nurtures the ambitions of: achieving and fostering better unity amongst the society, preserving a democratic way of life, creating a just society where the prosperity of the country can be enjoyed together in a fair and equitable manner, ensuring a liberal approach towards the rich and varied cultural traditions, and building a progressive society that will make use of science and modern technology.”
The second outlines the five principles – Belief in God; Loyalty to the King and Country; Upholding the Constitution; Rule of Law; and Good Behaviour and Morality.
Sadly, these values to teach, construct and mould a Malaysian society that is free from corruption, vengeance, envy and prejudice have been largely ignored and even forgotten by our leaders in recent times – if you can even call over three decades recent.
Perhaps, now is the time for our new Prime Minister and modern day government to return to these principles and construct a manifesto or policy of delivery that do not consist of race or religion-based voter appeal, and is more in line with what the average Malaysian politician wants. The question then becomes, does the new Prime Minister desires to be an average politician or a transformational one? For the sake of a new Malaysia, I hope his answer is the latter, because then we can dream of a united Malaysia once again.
YAB Tan Sri Dato’ Muhyiddin Yassin, you have stood up before the rakyat. Asked all Malaysians to give you a chance and to join you in rebuilding our country and restore its glory. Our faith – and the future of our country – rests in your hands. We sincerely hope you will make the right decisions befitting that of the people’s Prime Minister.
Alex Iskandar Liew, EVP & Partner at PEMANDU Associates and Managing Director of COMMUNICATE by PEMANDU, is a communications activist, who strongly believes that all public manifestos and government plans should be distilled into 3 feet programmes with clear outcomes, tasked to individuals who are driven and willing to be held accountable for their implementation and delivery.New Straits Times, 2020  Free Malaysia Today, 2020  The Edge Markets, 2019  The Star, 2020  The Malaysian Insight, 2017.  International Journal of Recent Technology and Engineering, 2019  MyGovernment, 2016.
In the past few years, the world has seen the growth of many movements that champion gender equality and diversity, both inside and outside of the workplace. Despite these efforts by advocacy groups, a recent report shows that women remain underrepresented at every level in the office; making up less than 50% of the workforce . In addition to this, some industries, including consulting, remain heavily skewed towards men.
In response to the trend, we talked to three consultants in PEMANDU Associates to have them share their experiences in the male-dominated industry. What stood out from their reflections is their mutual agreement in the importance of building and extending support systems in order for women to empower each other.
Cheryl Lim, Executive Vice President & Partner
Cheryl has been in consulting for the most part of her career. Throughout her past ten years with PEMANDU Associates, whilst rising to the ranks of Executive Vice President & Partner, she also became a mother.
Based on her own experience, Cheryl observes that the field offers equal opportunities to both women and men. She explained, “Consultants are selected for projects predominantly on the basis of their expertise and their contribution to the expected outcomes. It’s a case of the best person for the job.”
There are, however, different roles that women and men play in various phases of life, and at times, expectations towards both genders vary in this respect. Having said that, one changing trend that she noticed in the workplace is that employers today are making more conscious efforts to acknowledge that people have other responsibilities outside of the workplace. “I can see that among the leadership team, we are making an effort to appreciate and accommodate personal needs where possible, without putting work at risk. Everyone brings a different perspective to the table, and work outcomes benefit from this diversity.” Accommodating personal needs has also resulted in staff going the extra mile to get the job done.
Within the office confines, Cheryl pushes for women to be more proactive to find the support that they need, and this was, she believes, to be a key factor in the growth of her career. She sees value in building both formal and informal mentor-mentee relationships as the insights shared can benefit both parties. She shared, “I have also been inspired by my mentees as it is a symbiotic relationship.” And as a leader, it is paramount for her to create an inclusive working culture. For her, this means emulating and extending the support that she received from her peers when she became a mother.
At the end of the day, for female consultants to make their mark in the industry, Cheryl believes that it is all about doing great work and intentionally building relationships with people inside and outside of the office to help one flourish and grow.
Ilham Fadilah Sunhaji, Senior Vice President
For Ilham, empowering women takes a different form – advocating for progressive policies to be institutionalised within Malaysian corporations.
She has been a consultant for more than ten years with eight spent at the firm. Apart from consulting, she has also led projects in other typically male-dominated industries such as Oil & Gas and Manufacturing. The hard truth is that unconscious gender biases do occur, and in male-dominated industries, females have to work far harder in order to prove themselves due to persisting perceptions that males are more suitable for the job.
However, Ilham’s perspective is that showing direct resistance to behaviours like this will not bring about change nor alter perceptions. What she believes in is channelling her energy to the right causes, which was what drove her to help establish Malaysia Women in Energy (MyWIE), a platform that strives to give equal opportunities to women in the Energy industry.
MyWIE’s initiatives encompass all levels in the organisation – from entry-level positions to C-Suites, and up to those at the highest decision-making positions in the company. She has worked on providing policy recommendations to companies on how to create a more inclusive culture for women at work and also on ways to create a healthy environment where there is a level playing field for women to climb up the career ladder in the Energy industry.
Apart from MyWIE, she is also part of the 30% Club Investors Community Working Group (ICWG) that calls for a more gender-balanced board, especially in public-listed companies. This is aligned to the policy under the Malaysian Code of Corporate Governance whereby all 959 public-listed companies should have at least 30% female representatives on the Board. To date, the percentage of women directors appointed as Board Members in these companies has increased from 7.5% in 2008 to 16.3% in 2019. Moving forward, she plans to intensify her efforts in promoting best practices of gender diversity in corporate governance to the Institutional Investors Council and the Investment Group under ICWG.
Ilham believes that it is efforts like these that would make an impact to the society, consequently subtly fighting the unconscious discrimination that some may have towards women. She also advised for one to be patient and to be strategic on how to deal with these situations. “I believe that having patience and compassion in the face of adversity will only enrich the individual,” she said.
As a member of the firm, Ilham is glad that the company does not stop her from championing causes that are close to her heart. In fact, the company’s CEO, Idris Jala, goes to the extent of providing coaching to her as well as other potential women board directors. This is part of the PEMANDU Associates DNA in terms of Situational Leadership. By getting involved in activities to uplift women’s position in the workplace, this will inspire others to do the same.
An avid hiker, Ilham concludes that regardless of the industry they are in, women must be aware of their own strengths, and to not let society dictate the roles that they should play. In her words, “Know your value, and if you want things to change for the better, pursue the right channels to do so.”
Qaleeda Talib, Associate
Qaleeda describes herself as fortunate. Throughout her three-year stint as a consultant, she has not experienced any form of discrimination based on her gender. However, this does not mean that she should be turning a blind eye to those who have.
Fresh out of school, the University of Oxford graduate joined the firm as an intern, which then turned into a full-time job. The supportive and healthy culture at the firm has been one of the reasons why she chose to continue her career path here, alongside being surrounded by highly-skilled-yet-understanding seniors who are always helping her to grow. “My seniors see my gaps as an opportunity to nurture me to become a better version of myself,” she said.
She added that what she also liked about working in the firm is that she has not been impeded by her gender when it comes to participating in or leading projects. Based on her experience, with everyone’s mind set on achieving big and fast results, it leaves little space for gender-based prejudices to influence the delegation of work and responsibilities. “I have had the opportunity to collaborate with excellent male and female team leads, and this suggests to me that people are selected to do the job because they are able to deliver quality outcomes, and not because of their gender.” A former student of History, she recently pitched a project related to deliver business turnaround for one of the museums in the country. But little did she realise how much support she’d get from her seniors and peers! “What I can see is that people here will recognise you for your passion and your hard work. Nothing else comes into the picture.”
Even though her experiences as a female consultant may have been very positive, she’s cognisant of the fact that not all may feel the same. On one of the projects that she was on, a female teammate was treated badly by a client. Noting her teammate’s distress, Qaleeda extended support and help by escalating this issue to her Team Lead to ensure that the matter was managed. For Qaleeda, part of empowering female consultants is also providing a safe space for each other so that everyone can have equal access to a healthy and conducive work culture.
She also shared her two cents about today’s movements that are geared towards ensuring equal opportunities for women. To her, it is about ensuring individuals getting the right recognition for what they do more than it being a gender supremacy issue. Furthermore, she can see that the movements that started off with women-rights agenda are now extending their support to the opposite sex. “There are women organisations out there that now fight for paternity leaves. At the end of the day, people just want a better quality of life for everyone.”
To thrive at the workplace, particularly as a woman, focus on building your network of supporters, said Qaleeda. Just like other female consultants, she believes in recognising one’s own value and having the right people around who would support your aspirations. And for her, is it also crucial for one to always be mindful of what is happening to others, and to extend help whenever it is needed.
 McKinsey & Company, 2019
Since we established PEMANDU Associates, our client engagements have taken me across over 20 countries. And while the socio-economic or business contexts can differ greatly from country to country, what I’ve noticed to be a constant are the questions I’m frequently asked about on what PEMANDU Associates does. In light of this, I thought it would be good to share my quick-fire responses to 10 of the most frequently asked questions from both governments and businesses worldwide.
Question 1: What is the value proposition of PEMANDU Associates to your clients?
Our value proposition is simple – we help our clients transform in order to achieve Big Fast Results.
I think transformation is only a worthwhile venture if it delivers results. Any leader who pursues large scale change has to justify this often painful process of change by delivering quick and significant results. Our emphasis on the speed of delivery is key to ensuring that those involved do not lose interest through a lack of progress toward the big goal.
Question 2: What do you think are the critical success factors for successful transformation to achieve big fast results?
For any transformation to be successful, I believe that two critical success factors must come into play. Firstly, transformational leadership – requiring a paradigm shift in leaders where all decisions and actions are anchored towards effecting transformational change. Secondly, a new way of working (which includes a new way of communicating). There is no way that an organisation can transform unless it puts in place a radically new way of doing things. These two things are the prerequisites, without which transformation will not deliver big fast results.
Question 3: How does PEMANDU Associates help clients navigate their transformation journey so that the two critical success factors exist in their organisation?
At the firm, we have developed our own proprietary methodology to help organisations take their transformation journey forward. These are our 6 Secrets of Transformational Leadership© and our Big Fast Results (BFR) Methodology – 8 Steps of Transformation©. The former creates that behavioural shift to lead transformation, while the latter provides the practical framework to operationalise transformation at an extremely granular level.
Question 4: How important is the delivery of results as a measure of success for transformation?
It is critical. I believe that if the transformation work does not deliver tangible results, it is a failure. In fact, I will push this point even further; if it does not deliver tangible results in the first year of implementation, I consider it a failure. For this reason, at PEMANDU Associates, we are fixated on big fast results.
Question 5: Can you give an example of a company where your approach has been successfully implemented to achieve big fast results?
When I was appointed as CEO of Malaysia Airlines (MAS) in December 2005, the company was on the brink of bankruptcy and had just recorded the biggest financial loss in its corporate history. By applying the methodologies that I just described, in my first year, we successfully turned the airline around and recorded the company’s highest ever profit of RM840 million in the second year.
Question 6: Do you have another example in a different industry?
When I was appointed Managing Director of Shell Middle Distillates Synthesis (SMDS) Malaysia in 2003, the company had been unprofitable for 10 years. Shell MDS was the first Gas to Liquids (GTL) company in the World.
I recall on my Townhall session with staff, observing a huge sense of desperation and hopelessness. Absolutely convinced that it couldn’t be done, someone actually challenged me with a small wager that if the company became profitable within the timeframe I was given, he would pay me RM100 (a very modest bet for someone so sure of the outcome). But applying the methodology, we successfully turned the company around in just 6 months. I held the gentlemen to his word and to this day, the RM100 note can be found, framed in the Bintulu office with a note from him! We registered record profits year-on-year for 3 consecutive years.
By the way, there are many other case studies where PEMANDU Associates have helped clients succeed in their transformation programme to achieve big fast results. For example, we helped two universities successfully improve their profitability and their global ranking in the first 2 years of implementation. Another example is an unprofitable railway company that was successfully turned around in just the first year of implementation.
Question 7: Many of the examples you quoted are businesses. How about Governments in countries around the World, where the methodologies have been successfully implemented?
At PEMANDU Associates, we have been engaged to help many Governments around the World to help them increase investments in their economy. Our lab methodology, which involves a collaborative and meticulous approach to mapping out socio-economic transformational plans have helped many countries secure massive private investments in their first year of implementation.
For example, from the 8-week labs in Malaysia conducted in 2010, there were 131 projects with $406 billion of private investments, creating 3.3 million jobs.
In Oman, the 6-week labs generated 121 projects worth $42 billion investments.
In Nigeria, the 6 weeks labs generated 133 projects worth $51 billion investments, creating 692,000 jobs.
Question 8: Can you give social, non-economic examples in Malaysia where your methodology has been successfully implemented?
Using the methodology, under its Government Transformation Programme during the period of 2010-2017, Malaysia was able to reduce its crime index by 53%. Prior to this, the crime index increased by 43% over 4 years. In addition, the methodology was able to improve literacy and numeracy rates amongst primary schools (year 3) from 60% to 98%. Furthermore, urban public transport ridership modal share increased from 12% to 25%, while rural infrastructure (water, electricity and roads) benefited 6.6 million rural people with cash payments given to people whose incomes were in the bottom 30%.
Question 9: What are the pitfalls that might derail the transformation work from being successful?
The biggest pitfall is leadership commitment. This must be an enduring commitment, even in the face of resistance to change.
The second pitfall is the failure to institute a new way of working. There is a lot resistance from people who are not prepared to let go of the old ways of doing things. It requires relentless discipline and intervention to institutionalise the new way of working so that it becomes second nature.
Question 10: The case studies you refer to are impressive. How do you ensure that the methodology and lessons are shared more broadly so that other countries can learn and apply these transformation techniques?
The World Bank has written a case study on the PEMANDU approach in Malaysia. This case study document is one of the top hits within the World Bank’s report, which raked in the highest downloads. In addition, Princeton and Harvard have also separately written case studies of our methodology.
Apart from that, together with an excellent team of experts, I have been lecturing at the Harvard Ministerial Leadership Programme for the last 4 years. Held twice a year (April and June) in Boston, ministers from around the World attend this intensive leadership programme. I use this opportunity to share our methodology and encourage ministers to undertake their own transformation journey in their respective countries and contexts.