ROWE for an honest living ?

Cover via Amazon

A WRITER'S LIFE By DINA ZAMAN

The traditional economy of working long hours no longer works in a global economy that does not recognise time zones and deadlines.

MUCH has been written about the number of holidays and company leave days Malaysians have. What is apparent is the effect on productivity. Thus, begs the question: What is true productivity?

A number of columnists have shared their views. Is it true productivity when employees leave late simply because of the following reasons:

> The boss is working late or there is an unwritten code that until the boss leaves, no one else can; and

> The longer you stay at work, even if you are on Facebook, you are a good worker?


Peer pressure is a factor; another are long meetings with no set agenda and goals.

Perhaps Malaysian companies and business owners would do well to look at the US and Europe. Despite their worsening economies, a movement that addresses work-life balance is gaining ground.

Why Work Sucks and How To Fix It, written by Cali Ressler and Jody Thompson (www.gorowe.com) is about creating a results-only work environment (ROWE). Hot on the heels of lifestyle gurus such as Tim Ferris of the 4-Hour Workweek, Ressler and Thompson write about and offer solutions to the never-ending circus of meetings, schedules and clock-ins.



The traditional economy of working long hours from Monday to Friday, and also weekends, no longer works in a global economy that does not “understand” time zones and deadlines.

Home life, chores like doing the laundry, missing the children’s school concert — there has to be a better way to make a living.

You may wonder what is the difference between a flexible work arrangement and a ROWE.

Simply put, with flexi hours the employee needs permission and faces limited options. It is management controlled, requires policies, focusses on time-off, and there is high demand and low control.

ROWE offers the worker the following: No permission is needed and the working boundaries are unlimited. The employee manages his or her KPIs, and this requires accountability and clear goals.

If these are not met, out you go. ROWE focusses on tangible business results and it is high demand with high control.

Employers should view ROWE as beneficial to their businesses. They stop paying people for activities (Facebook anyone?) and start paying for outcomes.

They stop paying people for a chunk of time, and start paying them for their work. The employer must set clear terms of references on what needs to be done on a daily, weekly, monthly and yearly basis.

“Then it is up to the employee, with the coaching and guidance of the management, to meet those goals. If there are problems along the way, it’s the work that comes under scrutiny,” say the authors.

The big question is whether we Asians can adapt to this.

Asian businessmen and conglomerates have a different view of hard work, discipline and meeting profit margins. Despite the available technology, burning the midnight oil at work and networking while juggling a personal life still seem to be the practice.

It is common to see employees carrying two or three mobile phones and hooked onto almost every social media site, all in the name of keeping abreast with business trends. Is it any wonder why we are stressed?

Many will argue that with the wealth we are seeing now, there is little to complain about. People are more educated, healthier and hold down jobs.

However, economic growth and human development do not always coincide (UNDP Human Develop-ment Report 2010), and this is quite evident when one observes the current lifestyles of Malaysians.

Something must be amiss when many Malaysian professionals take up multi-level marketing jobs and other side businesses (i.e. tuition, catering) just to feed the family.

Young parents, seeking a better future for their children, take up consultancy or off-site projects just to be able to afford the tuition and activities their children need.

Holidays see tired families barely able to enjoy themselves. Stress-related illnesses are on the rise. The breakdown of relationships is on a steep increase, and thanks to limited time and resources, friendships are via social media like Facebook. This is not healthy.

More holidays do not mean that one’s life will change for the better when the fundamentals such as low pay (or not being paid what is worth) and archaic management per se are still practised.

With inflation on the rise on basic household goods, the Malaysian worker will have to grind even harder yet probably save little.


> A WRITER'S LIFE By DINA ZAMAN - The writer is working on religious histories and communities of Malaysia. She can be contacted at editor@thestar.com.my.

Change or be changed!

Image by Danny Choo via Flickr

WE all know that people and businesses who don’t adapt get phased out. Generation X, of which I am part of, has seen the evolution of technology transform how we live our daily lives.

From the VHS tape to the DVD and Blu-ray discs, and from snailmail to email, there are numerous examples how one way of doing things has given way to a faster, better and cheaper methods.

The bankruptcy of Kodak is the latest proof of how businesses can become irrelevant if they don’t keep up with the times. Research In Motion Ltd, the maker of BlackBerry phones, is feeling what Nokia has gone through. The digital age is moving along at breakneck speed and is transforming a multitude of industries and leaving an indelible mark on people and businesses.



There are companies that have done well to make changes on the fly. Most famous is Apple and before that Corning, which was – and maybe still is – famous for its cookingware rather than its fibre optics.

The need to transform is also not lost on corporate Malaysia. A lot of the big banks have done so and have become a lot better at what they do today. MMC Corp changed from a miner to an infrastructure player and the likes of Genting and IOI have expanded dramatically in the business they are in to become world giants today.

That transformation is also seen in the big institutions in Malaysia. The Employees Provident Fund restructured its portfolio from owning 400-plus stocks, some of which most punters will not touch today, to a leaner portfolio of around 100. Its narrower focus has allowed it to take the plunge into private equity and property and, as a result, the returns it can make for depositors should also improve in time.

The same can be said of Khazanah Nasional Bhd. In 2004, when Khazanah first started under new “management”, it had a bunch of old assets sitting in its books. They included stakes in some of the largest companies in the country, but sitting idle and waiting for results was not the way to go.

Khazanah restructured its portfolio, and from a bunch of companies that was heavily leaning towards utilities and telecoms, it invested in new businesses and industries. New investments were in part funded by monies from asset sales such as the divestment of Khazanah’s legacy stakes in Pos Malaysia and Proton.

As a result, Khazanah’s returns improved. During a recent briefing with the media, Khazanah revealed that if it had just sat on it and relied on the government-linked companies’ transformation programme alone, its returns would have been a meagre 2% a year.

But it did not do that and instead invested in new businesses which it felt will bring better growth. Those new investments brought in a return of 22% a year.

One such investment is the hospital business. Integrated Healthcare Holdings (IHH), which consists of hospital investments such as Apollo Hospital Enterprise Ltd and Parkway Holdings, recently made a big acquisition in Turkey when it bought Acibadem.

Healthcare in the demographics in which IHH operates will be hugely lucrative. India, South-East Asia and now Turkey have the desired young but ageing population with growing incomes.

IHH is slated for a massive listing and the changes that some entities in corporate Malaysia have undertaken should be a showcase of how transforming when it needs to be done should be the course of action.

● Deputy news editor Jagdev Singh Sidhu wonders when the retirement age in the private sector will be raised.

Call for a damn good shot: Light not founded Penang and Raffles, Singapore! Hang Tuah.., mere legends?

Myths, prejudice and history

Question Time by P.GUNASEGARAM

It is next to impossible to make history objective, but we must give it a damn good shot.

LEGEND is a lie that has attained the dignity of age. – HL Mencken The very ink with which history is written is merely fluid prejudice. – Mark Twain

Remember Jalan Birch in Kuala Lumpur, near the Merdeka Stadium? It’s been called Jalan Maharajalela for many years now, Birch becoming a victim of a programme of Malaysianisation of road names.

Image via Wikipedia

But Birch also became a victim of Malaysianisation of history – from hero, he became a villain, and his killer, yes, Maharajalela, became a hero in the flash of a road sign change.

Few things can so poignantly illustrate the change in historical perspective as a country changes.

JWW Birch was a British resident (adviser to the Sultan) in Perak in the 19th century. The British used a system of residents to control most Malayan states. A local called Dato Maharajalela assassinated Birch.

Although the reasons why he did this are obscure, Maharajalela is now hailed as a nationalist who opposed colonialism and died in the process – he and his accomplice were hanged.

Hence his elevation to hero status and Birch’s relegation to villain, a representative of an occupying force.

I remember my early history textbooks post-independence put Maha ra jalela in bad light until years later when the historical perspective began to shift.

We studied in our history books that Sir Francis Light was the founder of Penang which is ridiculous from a Malayan/Malaysian perspective because Malayans must have known the existence of Penang long before it was “founded” by Light. To this day, Wikipedia states that Light founded Penang. How confounding is that.

Captain Francis Light:  The statue of Captain Sir Francis Light at Penang, Malaysia

When the British “founded” places, it meant they then established a system of governance with rules of law. There is a court system and a police force. Prior to their “founding” there was no such legal system among the locals.

Then, there was Sir Stamford Raffles who similarly was said to have “founded” Singapore conveniently and erroneously erasing the arrival earlier to that place by a prince from Palembang, Sang Nila Utama, some 500 years earlier.

Image via Wikipedia

It seems like even Singaporeans believe their history started with Raffles. I was at a performance put up by Singaporean MBA students in 1991 which started off the history of the country from the time Raffles “founded” it in 1819. How unfortunate!

It was with great amusement that I read many years ago of a stunt pulled by an American (Red) Indian.

After arriving in Italy via a commercial flight, he promptly announced that he had founded Italy.

And what right did he have to make that outrageous claim? The same that Christopher Columbus, an Italian who sailed on behalf of the Spanish monarchs, had when he proudly claimed that he had discovered the Americas (at that time Columbus thought it was the East Indies) in 1492, a land already in habited by millions of others.



Now, Prof Emeritus Tan Sri Khoo Kay Kim has controversially raised lots of heckles and temperatures by saying that Malay warriors such as Hang Tuah and Hang Jebat were mere legends – myths invented by fertile minds for the amusement of others, much like the Greek gods.

He is, however, a renowned historian with no political ideology, racial or national axe to grind.

To his critics he has this to say: “If you don’t agree with me, bring out the sources to show I am wrong. You cannot simply say you don’t agree. I am saying that these things were not true because no reliable sources confirmed they existed.”

That is a clear indication as to how we should go about clarifying history.

History must be based on facts. It must seek to recreate - without any ideological, national, racial or any other bias - what happened to who, what, when, where, why and how, the journalistic five W’s and one H.

Otherwise it remains a myth and legend.

Just as in the case of Hang Tuah, one should seek to ascertain whether Maharajalela was indeed a hero by trying to establish, based on facts, his motives for killing Birch.

Otherwise it becomes a mere speculation and interpretation which is not history.

We are a relatively young country and yes, we would need to rewrite history from the perspective of Malaysia and Malaysians. No, Light had not founded Penang and Raffles, Singapore.

There may be many questions we can’t answer but we must make an effort to find them. And we need a proper system of archiving so that future generations know things the way they were.

History in school must not be a tool for nation building or used for any other agenda but to paint a true picture, as far as that is possible given all our collective prejudices, of Malaysia and of the world.

It needs to have balance, fairness and most of all truth about everyone’s contribution to nation building.
It must not seek to aggrandise one race or religion at the expense of others.

It must have enough of a mix of subject matter to ensure Malaysians have sufficient appreciation of Malaysia and how it has come to be where it is as well as an unbiased understanding of the state of the world. Anything else and it would become poor propaganda instead.

The best way towards this is to have a curriculum drawn up by historians and true educationists and to put in place a rigorous means of verification if we need to change history or at least what we learn of it.
You can interpret history but you must not rewrite it without factual basis.

It is next to impossible to make it objective but we must give it a damn good shot nevertheless, if we are not to live in and perpetuate a lie.

Independent consultant and writer P Gunasegaram (t.p.guna@gmail.com) says we need an accurate history before we learn anything from it.

Hang Tuah part of Malay cultural heritage

I REFER to Prof Emeritus Khoo Kay Kim’s statement declaring that Hang Tuah and Kris Taming Sari are the figments of somebody’s imagination based on the lack of credible evidence to authenticate their existence. As such they are not historical facts.

Image via Wikipedia

But these two elements are part of the Malay cultural heritage and have been embedded in the annals of the Malay civilisation, initially through oral tradition and later recorded in literary, dramatic and scholarly works.

Together with Puteri Gunung Ledang, Nenek Tempayan, Mat Jenin and Lebai Malang, they have adorned our lives through the retelling of their adventures and foibles in literary, dramatic and cinematic works.

They provide us with the opportunities of exploring the moral and ethical percepts of their actions.
Such traditional characters are ingrained as part of our psyche.

Many of us were brought up with Hang Tuah representing the epitome of loyalty, bravery and humility, character traits of such universal and noble stature.

In one swift swoop, Prof Khoo demolished part of our mores and lore citing the lack of concrete evidence to corroborate their existence.

As such, he suggested that they cannot be included as part of the history of the Malays.

But history itself is not beyond reproach. For historical narrations are a conglomeration of facts and fallacies that are given credence by those in power who tend to benefit most from such accounts.

And again, history was written by the victors who neglected the contributions of the vanquished, except those that portray them in a negative light. Thus, the “facts” were slanted to favour the powerful and the ruling elite.

Look at the account of the American Indians in the history of the American West. It portrays them as barbaric and evil and the white man as humane people who civilised these savages by putting them in reservations.

Likewise, the skewed perception of the aboriginal people in the annals of the Australian history.

In the same vein, a “historical” account of Palestine by the Jews would differ markedly from that of the Palestinians.

Similarly, the descriptive exploits of the Christian Crusade extolling the bravery and virtues of King Arthur would not tally with the account of the Muslims praising Sallahuddin Al Ayobi and the Arabs in the defence of Islam.

Thus, oral and recorded history is perceived from the perspective of the recorder who is not a disinterested party.

As for Hang Tuah and his companions, they have for so long been part of our cultural history. So too is the Kris Taming Sari which may not just refer to a single physical entity but rather a recognition bestowed on those that possess mystical and supernatural aura.

MOHAMED GHOUSE NASURUDDIN, Universiti Sains Malaysia, Penang   

Related post 

Malaysian History & Legend; facts & fallacies; myths, heroes or zeroes?

Chinese, and truly Malaysian?

By HARIATI AZIZAN sunday@thestar.com.my

A new book attempts to shed new light on the Malaysian Chinese community.

XINNIAN kuaile; Sin-ni khoai-lok; or Sun nin fai lok: there are more than eight Chinese dialects and languages to pick from when wishing Happy New Year to our fellow Malaysians.

Then we have the choice of ang pow, laisee or hung-bao, among others, to give out as gifts to children.

Most Malaysians, however, are not aware of this as the Chinese community is often seen as one homogenous community.

Different but the same: Although the Chinese-educated speak and read mainly in Chinese, they have no problem forging relationships with other rac es. — A. MALEX YAHAYA

Rita Sim, co-founder and fellow of the think tank Centre for Strategic Engagement (Cense), says this is perhaps the biggest myth about the Chinese community in Malaysia.

“Even for those who are aware that there are various dialects and languages among the Chinese, many still think that the Malaysian Chinese community is homogenous,” she says.

This is one of the misconceptions that Sim hopes to address in her book Unmistakably Chinese, Genuinely Malaysian.

The idea for the book, she relates, was conceived when she was doing marketing for the local Chinese daily Sin Chew.

“Media planners and advertisers in Malaysia are largely English speakers, so many do not realise how big and diverse the Chinese community in this country is,” she says.

In her book, Sim divides the Chinese community into three clusters, G1, G2 and G3, which in loose terms can be defined as “Chinese literate”, “non-Chinese literate” and the “Overlap” respectively.

Three clusters: In her book, Sim divides the Chinese community into G1, G2 and G3, which in loose terms can be defined as ‘Chinese literate’, ‘non-Chinese literate’ and the ‘Overlap’ respectively

 

“This is only to give it a vocabulary. Actually, this is common knowledge among the Chinese speakers and readers, but it is new for the others,” she tells Sunday Star, adding that the terminology was first mooted by social observers and influencers of Chinese communal development.

The first cluster, G1, is the largest and forms 85% of the 6.5 million Chinese in Malaysia. “They are guided by Chinese philosophy and are immersed in Chinese language and culture,” Sim says.

This cluster is growing as more than 95% of Chinese parents are now opting to send their children to Chinese schools.

“Over 90% of the Chinese in Malaysia now are Chinese speakers,” she highlights.

The second, a considerably smaller group at between 10% and 15% of the community, is more cosmopolitan. They are likely to have a large network of close friends from other communities and are influenced more by Western-style learning.



Between these two groups is an overlap the G3, which consists of G1 or G2 Chinese who, through language or work exposure, have stepped into the other grouping and survived, even thrived.

Sim notes that although carving up the community in this manner may seem overly simplistic, “it does support the reality in significant ways.”

Crucially, she adds, the clusters are not fixed.

“They are fluid as the Chinese move in and out of the clusters depending on their education and income level, and they are certainly not like mainland (China) Chinese.”

As Sim points out in her book, the G1 have adopted a socio-cultural framework which rests on three main pillars: Chinese education, Chinese media and Chinese organisations.

The G2 Chinese are not Chinese-educated. They speak English and include a large number of Christians and the Peranakan. They are comfortable reading English or Bahasa Malaysia newspapers and tend to take a Malaysian perspective as opposed to an exclusively Chinese one.

Despite the existence of the G3 category, the two main groups remain quite distinct.

The G2 parent, for example, does not subscribe to the three pillars but for pragmatic reasons, many send their children to Chinese schools to give them a leg-up in the globalised world.

Among the G1 group, Chinese education is inextricably linked to identity and has little to do with globalisation.

Thus, the G1 stands firmly by the Federal Constitution, which allows Chinese and Indian communities the right to mother tongue education, Sim says.

No hindrance to unity

While Chinese schools have been blamed as the cause of disunity in Malaysia by certain sectors, Sim disagrees.

“Today, I don't see Chinese schools as a hindrance to integration because even in Chinese schools you have to learn Bahasa Malaysia. It is a compulsory (subject). And if you go out today, more than 90% of the Chinese in the country are able to communicate in Bahasa, so there is no communication problem.”

Sim strongly believes it is time to acknowledge the role the G1 play in the country's social and economic development.

Proficiency in Chinese is an advantage in the world now, especially if you want to do business in China, she points out.

This is true, and even the BBC has recently reported that Malaysians have an advantage in China because of our multilingual education.

“How many people can speak Mandarin, multiple Chinese dialects, Malay and English?” Lim Cheah Chooi from engineering firm Unimech Group Berhad, which has production factories in China, was quoted by the BBC.

Sim concurs, adding that Malaysians are also able to venture into the Indonesian market because of their fluency in Malay and they can go to the United States and Europe too because of their knowledge of English.

Malaysia is unique in the sense that we have parallel education systems vernacular schools, national schools, and private schools, stresses Sim.

“It is unique as it is only in Malaysia that different streams are allowed to exist, and in such a thriving manner, as part of the mainstream school system,” she says.

“In the whole of South-East Asia, Malaysia is the only country where you can find 1,293 Chinese primary schools, so we have a choice of sending our children to Chinese schools or national schools, then let them continue their secondary education at one of the 61 Chinese independent schools or 78 SMJK (C). And later, they can even finish their tertiary education in Chinese at three local colleges,” she adds, highlighting that the schools are highly in demand even among non-Chinese families.

Instead of politicising the issue, we need to list the qualities of the system and see how we can push it further, she says.

“In the long run, perhaps a review is needed to standardise the national education system have one school system with language classes available but it will need a lot of resources.”

Notably, says Sim, the new G1 generation is very connected to the local community.

“Although some received tertiary education in Taiwan and China, many are very connected to Malaysia.
Many are very aware of the issues in Malaysia and are engaged with Malaysian communities, especially in the urban areas. They feel that this is home and want to make it a better place.”

Although many speak and read mainly in Chinese, they have no problem forging relationships with other races.

Sim had originally targeted her book at advertisers, media planners as well as government agencies to stress the importance of understanding the complexity of the Chinese community for effective communication, but she now believes that it can also benefit the general public.

This is particularly essential in light of the pendatang (immigrant) issue that is now and again flogged by various factions for political gains.

“In any society, you will always have the extremes, the ultras and conservatives, and the way to deal with this is to continuously engage in educating them. That is why the historical aspect is important how Malaysia came about. This needs to be taught in school and for all Malaysians to understand. Hopefully, in time to come, the ultra conservative element can be reduced.”

At the same time, an understanding of the contemporary Malaysian society is also important.

“This is something else that I hope to spur debates on the issue,” she says.

Ultimately, Sim hopes the book can shed some light on the Chinese community and help end the pendatang argument.

“We never deny the fact that we are Chinese through history and in the historical context, but today we are genuinely Malaysian. We are very different from the Chinese who came here in the 18th century,” she stresses.

“Whatever our historical background, we are Malaysian, so we should not question this any longer. That is why I named the book Unmistakably Chinese, Genuinely Malaysian.”

Related articles/post:

• Will China's rise shape Malaysian Chinese community?

  I Recognise You! But How Did I Do It? How local Chinese see faces?

Challenging the State-Capitalism?

Clash of capitalist systems

GLOBAL TRENDS  By MARTIN KHOR

The Year of the Dragon may symbolise the struggle for prosperity for some, but others may use this year to challenge what they call state-capitalism being practised by developing countries, especially in Asia.



IT’S the first day of the Year of the Dragon. Like others around the world, Malaysians hope it will be an auspicious year.

Certainly it will be an interesting one. Perhaps that’s the only certainty about this coming year of uncertainty.

The new Dragon Year will usher in even more intense debate about the role and the rise of China and of other “emerging economies”.

As the Western countries face gloomy economic prospects, some of their political elite and intellectuals seem to be seized by fears that some developing countries, especially China, will be steaming ahead.

Used to centuries of global economic dominance, these advanced countries are fearful that their leadership will be challenged and even overturned.

This may be the reason for the obsession about China. These days, there are new books almost every month about the rise of China. Some deal with its high growth and prospects or with its complex political developments.

Quite a number, like the book Death by China: Confronting the Dragon, are of the view that China is destroying not only the American economy but the whole world and its environment.

But the fears go beyond China, and incorporate other emerging countries as well, as seen in the latest issue of The Economist, with its cover stories on “The rise of state capitalism: the emerging world’s new model.”



The magazine describes the 88-storey Petronas Towers soaring above Kuala Lumpur, as well as the China Central TV building in Beijing and the VTB bank office in Moscow, as monuments to the new hybrid corporation – backed by the state but behaving like private-sector multinationals.

The Economist’s editorial admits that for emerging countries wanting to make their mark on the world, state capitalism has an obvious appeal, giving them the clout that private-sector companies would take years to build.

But its dangers outweigh its advantages, says the magazine. For their own sake and in the interests of world trade, the huge holdings should be unwound and handed over to private investors.

The Economist however also admits that this hybrid form of “state-directed capitalism” company is not new, and cites the East India Company.

This was the huge conglomeration that took over many Asian countries’ economies, while the English government made use of its gunboats and colonial rule to back up the EIC but other British companies.

The magazine also cites the United States after its war of independence, Germany in the 1870s, and Japan and South Korea in the 1950s as examples of rising powers using the state to kick-start growth.

There is thus recognition that the rise of today’s advanced countries was based on the state’s strong support in their companies’ emergence.

These companies have dominated the global economy for decades and in some cases centuries, backed up not only by subsidies, cheap credit and other policy measures but also by their governments’ political and military force.

In the past three decades, most developing countries have been told, through IMF-World Bank structural adjustment programmes, to give up the role of the state to direct their economies and instead rely entirely on the private sector.

These policies did not succeed as the domestic private sector is weak or even non-existent in many countries. In poor countries, foreign companies were not interested in coming in except in the mining or plantation sectors.

However, several other developing countries, mostly in Asia, took on a different model. Their governments believed in playing an important or even dominant role in the development process.

At first these governments owned companies that they ran like government departments, and this was not efficient. This model was changed in some countries to one where the state can own or partly own companies that are then run on a commercial basis. The state can also assist private companies to grow.

Government investment holding institutions like Khazanah and PNB in Malaysia or Temasek in Singapore have been set up as crucial components of this framework.

The increasing criticism by Western intellectuals and politicians of “state capitalism” is not confined to academic observations.

The US administration and Congress are contemplating legislation and action to place extra tariffs on Chinese products not only on anti-dumping grounds but also that they have been subsidised and that China is not a market economy.

The Congress is also discussing whether to slap tariffs on Chinese products on the ground that China’s currency is manipulated and under-valued.

While the focus now may be on China, other developing countries may be faced with the same actions based on the same reasoning, that these countries are unfairly helping their companies through policy measures that represent state-capitalism and industrial policy.

Moreover, the US and Europe and now negotiating free trade agreements with developing countries that contain clauses or even chapters that seek to prohibit or restrict the practices of government-linked companies, or the provision of subsidies and preferences by government to local companies.

Korean economist Ha Joon-chang wrote a famous book Kicking Away the Ladder to describe how developed countries made use of policies that made them rich, and now want to prevent developing countries from doing the same and thus are seeking to prohibit these same policies.

The clash of capitalist systems and the clash between developed and developing countries over what policies are legitimate and which should be banned will intensify in this Year of the Dragon.

Related articles

• The Rise of State Capitalism. (isellerfinance.wordpress.com)

US Military Strategy to Asia: Poke a Stick In China's Eye

A military pivot to Asia

By TANG SIEW MUN

‘Pivoting to Asia’ is fast becoming the centrepiece of US strategic and diplomatic objectives.

IF there were doubts about America’s “return” to Asia, all were dissipated with the release of the new strategic guidance report by the Pentagon on Jan 5.

Washington’s grand objective can be gleaned from the title of the report, “Sustaining US Global Leadership: Priorities for 21st Century Defence”.

While the report affirms US interests worldwide and renews its pledge to uphold its commitments to its allies and friends, it unambiguously stresses the importance of Asia. It states that the US “will of necessity rebalance towards the Asia-Pacific region”.

The report follows through the grand strategic vision enunciated by Secretary of State Hillary Clinton in an article published in Foreign Policy where she declared that “the future of politics will be decided in Asia, not Afghanistan or Iraq, and the United States will be right at the centre of the action”.

“Pivoting to Asia” is fast becoming the centrepiece of US strategic and diplomatic objectives.

Before “pivoting” became the cornerstone of the US-Asia policy, the region was abuzz with the US “return” to Asia. China, understandably, was especially agitated.

Indeed, there are segments in China who view the US “return” to Asia with a sense of foreboding, as US initiatives are seen as stratagems to contain China’s growing influence and power in the region.

If hitherto there were concerns about the US return to Asia, then Washington’s “pivot movement” to Asia will certainly generate more discussion and potentially countervailing measures.

To be sure, “pivoting” is different from “returning”. In general, a US return would be marked by its heightened diplomatic engagement, especially with its newfound interest and support for multilateral initiatives such as the East Asia Summit.

A US “return” to Asia would be largely viewed by South-East Asia as a positive development, especially in an uncertain strategic environment punctuated by China’s expanding economic and military power.

In this regard, the US is seen as a reliable and indispensable power to balance and, if necessary, to check Chinese aggressive designs.

However, pivoting in the context of the Pentagon report may see an increased US military presence in the region.

South-East Asia is no stranger to the US military. Up until November 1991 when the Clark Air Base was returned to the Philippines, the US had maintained a large military footprint in the region.

The US has close relations with its treaty partners Thailand and the Philippines. In November 1990, the US negotiated an arrangement with Singapore that gave it access to and use of facilities in the city state.

Singapore is also home to the US Navy’s Logistics Group Western Pacific that provides logistics support for the US Seventh Fleet.

For many decades, the US had consistently maintained a high strategic profile through bilateral and multilateral military exercises and other military-to-military cooperation.

The hubs-and-spokes system of bilateral security treaties, which includes South Korea, Japan and Australia, has long been regarded as the backbone of the region’s security.

The strategic presence of the US in, and its engagement with, the region is often quoted as one of the primary reasons for South-East Asia’s stability and growth.

The argument goes that the US provided the security umbrella which allowed South-East Asian states to limit their defence outlays.

This argument was certainly valid during the Cold War era when the Asean states were undoubtedly pro-American and cooperated to varying degrees with the US.

In fact, when the US Air Force pulled out of the Clark Air Base, there was a sense of trepidation and the perception that the US was withdrawing from the region.

There was genuine fear about a power vacuum which would “invite” other major powers to supplant the US’ dominant role in regional security.

Fortunately, these fears were unfounded as the expected jostling for primacy in Asia and the feared US retreat did not materialise.

While the US’ diplomatic and political “return” to the region is applauded and welcomed, reception for its “pivot to Asia” may be less enthusiastic.

There are several reasons for such pessimism. Granted that the pivot strategy will be multifaceted and not uni-dimensionally focusing on military power.

However, it is the latter component of the pivot strategy that may prove to be most controversial.
To the extent that pivoting entails an enlarged and more visible military footprint, it will be destabilising and anathema to regional security.

An increased US military profile will generate what academics understand as a “security dilemma” and make China feel uncomfortable, to put it mildly.

A case in point is the recent announcement of the deployment up to 2,500 US Marines on a “rotational” basis in Darwin, Australia.

Washington and Canberra were quick to emphasise the transient nature of the deployment, but whichever way one attempts to slice and dice “Darwin”, in the eyes of the Chinese and the rest of South-East Asia, this move puts hundreds of well-trained and highly mobile US military personnel at the edge of the region.

It is a potential “beach head” for the US to organise and launch military expeditions into South-East Asia and the Indian Ocean.

We can also expect to see more of the Stars and Stripes in the region.

Last month, Chief of Naval Operations Admiral Jonathan Greenert wrote in the US Naval Institute’s Proceedings that the US is contemplating deploying littoral combat ships in Singapore and “other places” in South-East Asia.



We must ask ourselves whether there is an imminent threat in the region that necessitates increased fire power from the US.

There is a point beyond which an increased military presence provides a negative marginal return. More is not always necessarily better.

There may be quarters in South-East Asia that embrace a larger US military role and profile. Notable among these are the “hedgers” who no doubt see the US as the ultimate “insurance policy” to guard against strategic uncertainty.

When it is diplomatically untenable and militarily impractical to balance against China’s expanding military might, then the growing presence of the US is reassuring, to say the least.

It cannot be denied that the People’s Liberation Army’s (PLA) growing muscle is being closely monitored and analysed.

While there is no unified response to this phenomenon, it is accepted that South-East Asia cannot match the PLA gun for gun.

A military response is destructive and ultimately futile. The preferred modality is to embed China in a web of regional and multilateral cooperation mechanisms.

The Asean China Free Trade Area (ACFTA) and the Asean Plus Three (APT) are but two examples.

South-East Asia should stay the course and continue its ongoing successful engagement of China. However, the military component of “pivoting” may serve to amplify the strategic divide and suspicions between China and South-East Asia.

The implications of “pivoting” are multiple. For a start, the US will seek a larger voice and role in the region.

Secretary Clinton spoke for many Ameri­cans when she asserted that Asia is the future and correspondingly the US must be in Asia.

The substantive question that needs to be asked is, “When the US leads, should Asia fall in line and accept US leadership?”

It would be unrealistic for Washington to assume that Asia will do this. Acceptance of US leadership is not universal, nor is it automatic.

Support for the US in Indonesia, South-East Asia’s largest country, is slipping. The Pew Global Attitudes Survey showed it has declined from 56% in 2009 to 49% in 2010.

Asia does not dance to the tune of Washing­ton, nor does it march to the beat of the Chinese.

While Washington sees its future in Asia, it needs to be mindful that the success of its “pivot” strategy is contingent on the concurrence and support of Asia.

The operative words are cooperation and collaboration.

The region’s strategic uncertainty – read as fear of China – cannot be resolved by the placement of more US troops in the region or through military grandstanding.

It is not about being pro-US or anti-China but how to build a stable, secure and prosperous future. The US pivot to Asia should be welcomed to the extent that it contributes constructively to a better and brighter future for Asia.

> The writer is Director (Foreign Policy and Security Studies) at the Institute of Strategic and International Studies (ISIS) Malaysia. The views are his own.

Obama's New Defense Strategy: Poke a Stick In China's Eye And See What Happens 

This new "Defense Strategy" of President Obama's is a deliberate provocation of the Chinese, as was his trip to Asia last month when he made his none too cute "We're Back" declaration.  

Last Month in Australia Obama was quoted as saying, “Let there be no doubt: in the Asia-Pacific in the 21st century, the United States of America is all in.” 

If there was doubt in anyone's mind in Beijing, about American intentions Obama dispelled that doubt and any room for reasoned diplomacy by elaborating that this is a “deliberate and strategic decision” America is “here to stay”.    What an affront to the Chinese!  We were hoping the State Department would let this new offensive go quietly away.   Unfortunately, that is not to be.  Obama's "Strategy" is a dangerous road to take.  If it is intended to assist him in his re election efforts it will seriously backfire.  Unfortunately, the consequence won't be just Obama's and the Democrat Party.  The outcome of this foreign policy fiasco  will fall squarely on the shoulders of America and it's allies.  This new policy is literal insanity. It would appear Obama is playing right into the hands of Hu Jintao and the Chinese military leaders who are just chomping at the bit for a fight.    An Article in the Economist in a much more nuanced and cautious fashion discusses the concerns many other's have about the manner in which Obama is flexing his muscles and apparently bullying for a fight with the Chinese.  

China hasn't issued a stamp with this ferocious a dragon
since 1878 (Photo Xinhua)

This is the year of the dragon and they must be deft dumb and blind over in foggy bottom to have missed the significance the Chinese attribute to this auspicious event.  The dragon was a symbol of  China's Imperial Power and today it is a not too subtle symbol of China's Military, Political and Economic power.  That China chose to reissue such a ferocious stamp this year is no coincidence.

We have to ask ourselves why has Obama picked this time to insult and bully a world power that is vastly superior to our own, certainly in it's own backyard.  Does anyone think the Chinese are going to stand idly by as Obama in his arrogance, asserts his "right" to "ensure China's peaceful rise to power".    The implied threat in that statement from Obama and the Clinton State Department is palpable.  The US, in the person of Obama, is saying, "We're going to come into China's sphere of influence

and arbitrate and adjudicate any and all issues we decide have a national security interest to us."  Certainly, the United States should not cede it's position as a world power and it's interests but to do so in such an ignorant and arrogant fashion is inexcusable.

A bizarre thought occurs to us that given Obama's own love of Socialism and Marxism maybe his provocation of China is intended to give Hu and General Lin Yuan, (A possible successor to Hu) an excuse and license to go to war with America.

Posted by FarmerRicky

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• China warns US on Asia military strategy 
• ASEAN Sumit: US reasserts role as Pacific power ...
• G20, Apec without gusto; Asean for peace; US cold war ...

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Yes, Facebook addicts, must get out to socialize more!

 

Facebook addicts should get out and socialise more

The Star/Asia News Network

WITH every new level of technology comes a corresponding wave of casualties.

From theft victims careless with their bank ATM cards to gullible folk cheated in online scams, the story is familiar enough.

So today we see the rise of Facebook addicts. The fact that this involves victims without criminal perpetrators does not make it any less serious.

Facebook addiction has been known to affect the psychological and physical health of its victims.

It also affects the personal relationships that victims had, or might have had, with others around them.

It is therefore a personal, domestic and social problem. The affliction is universally acknowledged by health professionals who have dubbed it Facebook Addiction Disorder (FAD).

It is compulsive, invasive of one's personal life, distorts priorities, damages one's capacity to relate to others around them and disorientates one to reality.

There are withdrawal symptoms, pangs of “cold turkey” and it is all downright senseless and wasteful.
How can it then be addressed effectively?

Relying on addicts to stop their addiction is not going to work. Neither will legislation, since Facebook can all too easily be accessed through computers or smartphones.

With children and young adults, FAD is particularly pernicious because it eats away at their health in their formative years.

Yet, it is with young addicts that the problem is perhaps easier to avoid with prudent parental intervention.

Adults as parents or guardians therefore have a responsibility to ensure that those under their care do not fall victim to FAD. And as adults anyway, with or without others under their care, they need to set an example by not falling victim themselves.

If push comes to shove, there is always the off switch.

For Malaysians to “have the most Facebook friends in the world” may at first sound gratifying, but in reality it is a condition ridden with problems and liabilities.

The best friends tend to be those you encounter in the flesh. A “friend” in cyberspace may be very unreal, whether as a notional friend of a friend, a fictional character, or even a predator.

If Malaysians have the most virtual friends in the world, it may well be that we have the least real friends in the world. And that would be another tragedy in itself.



Hi, I was a Facebook addict

I REFER to “Hooked on FB”  (Jan 20), on Facebook Addicton Disorder (FAD), and agree with Dr Nivashinie Mohan’s statement that people with this disorder “continue to go undetected because most addicts do not realise or admit they have a problem”.

If there had been a circle of addicts on the floor at the FAD forum, I would have introduced myself and said: “Hello everyone, I was a Facebook addict”.

When I decided to navigate to the “deactivate account” button last December, I thought I was making the hardest decision I would ever make, having been a Facebook member since 2006.

I did not have hundreds and thousands of friends (most of whom we ignore anyway and just concentrate on the five to ten so-called friends), but it was the excitement of waking up every morning literally dying to know what the rest of the world was up to.

I was an active lurker looking into my friends’ beautifully edited photos of where they went on holiday, what they cooked for their children last night, friends updating their status every five minutes (as if having a huge following on Twitter wasn’t enough) somebody’s wedding, graduation and etc.

After a while, I felt funny. Why is this so important? Why can’t we call, visit or text each other instead? Wouldn’t this be more intimate, more humanly possible to touch base sans the social network?

Aren’t we concerned about the security of our information over the Internet? A paedophile would have a field day ogling at our children’s profiles and the repercussions would be devastating.

And aren’t political and racial updates overly nauseating?

Don’t make me start with friends who actually upload positive thoughts by the dozen until you actually think they are really closet pessimists who crave attention (yes, that is yet another disorder).

Then again, self realisation is the best way to overcome any disorder, and admitting it is the next step to get oneself out of the problem. Who knows, maybe FAD sufferers may get help from support groups or toll free numbers in future.

To each his own, as the old saying goes.

For the majority, it is necessary to maintain one’s Facebook account as it is a vital part of one’s life and we are, as long as we are the ones in control.

For the minority, like me, we choose not to be the norm and will find other alternative communicating routes to get our messages across.

SUZLENE ZAKARIAH,
Seri Kembangan.

Have clear policy on FB for workers 

Bosses must devise solutions to deal with this IT challenge!

I WOULD like to share my opinion in relation to “Bosses face problem with workers wasting time on FB” (The Star, Jan 20). The use of social networking websites and its easy accessibility has posed a lot more challenges and problems to the employer than has been pointed out.

Social network, depending on the nature of the work, can be good or bad for productivity. For some it’s one of the most cost and time effective way to promote and achieve sales targets.

Some government agencies and NGOs use it in their work to reach more people and to better know their stakeholders.

For those who work long hours or are on the graveyard shift and are detached from family and friends, it may help reduce stress.

Social networking can be a recruitment tool. Some employers and recruitment agents use it to do background checks on employees.

On the converse, it can severely affect productivity as employees waste countless hours on social networking. When done in the office, it increases unwarranted Internet traffic and slows down office network speed.

A major issue which has got a lot of attention globally is employees making statements about their employers that are considered negative by the employer.

While statements which tend to lower the reputation of the employer in public can be considered libel, it is more complicated when it comes to employment relationships. There are two schools of thought.

In the UK, the employment tribunal upheld a decision by Apple to sack an employee for posting on Facebook his displeasure about his iPhone and various aspects of his company even though his remarks only reached certain people due to the privacy settings.

In the US, the National Labour Relations Board (NLRB) came to an opposite conclusion and found illegal a company’s decision to fire an employee based on disparaging remarks about her employer and on a work place incident she sent from her home computer 
.
I feel the UK approach is better. A negative statement by an employee can severely affect the employer. The company’s reputation is at stake, and it may affect the employer’s business goodwill and profits. Some job seekers might shun the company purely based on hearsay.

And, in a more sinister way, social networking can be used to disrupt industrial harmony by organising illegal strikes to cripple an entire industry and bring down the economy.

I don’t feel that a strict policy on social networking may discourage young ones from joining a particular company.

The main concern for the working young, or everyone for that matter, is the pay and benefits, and of course job satisfaction.

An employee frequently using social network at work should face disciplinary action to serve as a reminder to the perpetrator and to show others how serious the employer views such complacency.

And of course for the company to take disciplinary action it has to have rules to begin with. As long as there are no sanctions, employees will continually flout company rules and slack.

But again some might argue that it may not always be practical in real life as the world and society are addicted to social networking.

Some young employees, fresh to the working world, have no clue on responsible working etiquette and may think that employers don’t mind them engaging in social networking during work hours.

It is important that a clear policy is drawn up by the employers and brought to the attention of employees on how the company feels about it and how it affects them.

The responsibility of discipline at work does not start with the HR/IR practitioners. Our education system should have an active role in educating and shaping young ones who will be joining the work force one day.

Not only institutes of higher education like colleges and universities but schools as well should inculcate responsible work etiquette which includes being on the social network during work hours, among other things. Sadly, this is lacking.

While it is almost impossible to prevent employees from accessing social network sites, as it can be easily accessed through their smart phones, both employers and capable HR/IR practitioners have to come up with proper solutions to deal with whatever challenges advancement of technology throws at them.

JOHN MARK,Segamat.

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The natural evolution of markets

THINK ASIAN By ANDREW SHANG 

 

Market change: A general view of ebay headquarters in San Jose, California. Websites like ebay and Alibaba has eliminated geographical space by allowing transactions in rural markets to be done online. —Reuters

Man is a social animal. The 19th century sociologist and philosopher Georg Simmel argued that trade and exchange is “one of the purest and most primitive forms of human socialisation.” Last month, while travelling through remote parts of West Timor, in Indonesia, I was able to study first-hand how rural markets operate. I could not help wondering why so-called primitive markets such as these work so well when complex financial markets can be so dysfunctional?

Rural markets in East Timor are wonders of trade. Men and women in tribal costume converge on different villages on different days of the week. Everyone knows when to go to which village for these markets, which typically start at dawn when produce is fresh and often finish by 11am. Economists would surely call this scene of bustling rural commerce a “concentration of liquidity.”

As the late Stanford economist John McMillan argued, the market is a human construction- a tool. The market has features to make it work smoothly: mechanisms to organise buying and selling; channels for information flow; laws that define property rights, and self-regulating rules that govern behaviour.

Most rural markets are much more complex than they appear. They sell everything needed for daily life and have their own hierarchies. The stalls of wealthier, established traders are sheltered and in the best locations, while poorer traders just spread their wares on the ground. Specialisation is evident even in this basic setting there are designated places to buy textiles, fresh meat or fish, vegetables or household goods. These markets also function efficiently as information exchanges. Prices differ depending on who you are and what you know. Tourists pay more because they do not know the local language or rules, while locals bargain vigorously.

In these basic markets, you can observe the entire range of business evolution, from simple production, to wholesaling to final sale. Everything is designed for convenience and to reduce transaction costs. For instance, there are no roadside petrol pumps. Instead, petrol is sold in small bottles because the most common transport are motorbike taxis that carry as many as three passengers plus the occasional chicken or bag of rice.

The permeation of technologies like mobile phones and the internet even into these remote rural areas has accelerated the speed at which information travels through these markets. This means even lower transaction costs between business, between consumers, and from businesses to consumers. In some instances, use of websites like eBay and Alibaba have eliminated geographical space by allowing transactions in such markets to be done online.

With technology ending the isolation of rural markets and linking them to global markets, the production and marketing game is changing beyond recognition. A similar phenomenon occurred in the airline industry. Budget airlines use the internet to sell forward excess capacity at below average cost, thus filling their planes to capacity and maximising profits. This created a new market because before, many people could not afford to fly.

You see the effect of high transportation costs clearly in rural markets. Here, locally produced goods are ludicrously cheap, but imported good are very expensive.

The study of modern, sophisticated supply chains enables us to appreciate the fact that producers do not necessarily make most of their money in the product-to-consumer chain. The rule of thumb is that if a product costs US$1 to make, the distribution and transportation costs may account for US$3 of the US$4 final sale price to the consumer. Common conceptions of innovation still focus largely on creating new products, whereas services or process innovation are probably much more profitable and add more value than is generally understood.

To illustrate, the global trade regime still has a “hardware” focus, concentrating on physical trade rather than the more complex and less measured services trade. Apple innovated not in manufacturing, but in design and lifestyle. This means that it can sell a product at much higher prices than its competitors. Once it has captured a market, value creation comes from downloading new apps for the iPhone and iPad.

Financial services have emerged as one of the most profitable businesses, certainly until the last financial crisis. For a time before the 2007 crisis, the turn on capital in the financial sector was 20% per annum, significantly higher than for manufacturing and other real sector businesses.

With the benefit of hindsight, we now know there were two major reasons for the large profits in finance. The first is that the physical cost of creation of a financial derivative is almost zero, as it is an abstract product of its creator's imagination. For many, the reason to buy a derivative is to hedge and reduce risk. If a buyer believes that the hedge is useful, which it can be under specific circumstances then he or she will be willing to pay a premium for that hedge. A second reason is leverage. The greater the leverage, the larger the profits are for both lender and borrower. But there is a catch it adds systemic risk to the entire market and can be fatal to the over-leveraged borrower.

The FX Accummulator is a good example. It is a financial product that looks and feels like a wonderful foreign exchange hedge that yields good profits for the speculator. However, many were not aware that at certain price levels, the amount of margin called by the lender could be greater than the total assets held by the speculator. Thus, what appears to be a “safe” hedge can turn out to be toxic, particularly when markets are volatile.

This raises the question whether financial markets have evolved beyond the limits of social safety. University of Southampton Professor Richard Werner is one of the first to point out that there are two aspects of credit creation one that contributes to real value creation and one that does not. Financial markets have evolved into highly complex systems that consumers, financial experts or regulators do not fully understand. Increasingly, they contribute less to social utility and become systemically fragile.

As McMillan presciently pointed out, “markets are not miraculous. There are problems they cannot address. Left to themselves, markets can fail. Viewed as tools, markets need be neither revered nor reviled just allowed to operate where they are useful.”

Rural markets arise from communities that have organised their commerce in such a way that reinforces social utility and stability. The Holy Grail of financial theory and practice in the world's advanced economies is to identify at what level of complexity financial markets exceed the limits of social stability.

Andrew Sheng is President of Fung Global Institute.

Auditing in hard times

OPTIMISTICALLY CAUTIOUS By ERROL OH

HOW bad will things be this year? Everybody has some thoughts on that, but nobody really knows, of course. But if you're thinking of turning to the accountants and auditors for some reassurance and optimism amid the gloom, you're definitely barking up the wrong tree.

The fact is, this fraternity is already bracing for the worst and is calling upon members to be on the lookout for signs of trouble as they carry out their work.

On Dec 28, the International Auditing and Assurance Standards Board (IAASB), the New York-based independent standard-setting body, issued a press release to draw attention to the challenges that accounts preparers and auditors currently face.

“The global economy continues to experience difficult conditions as the effects of the financial crisis for example, on corporate cash flows and access to credit persist. Volatility in capital markets, and issues including measurement and disclosure of exposures to sovereign debt of distressed countries, continue to create uncertainty,” says the board.

“The impact of these issues and uncertainty has wide-ranging financial reporting implications that often extend beyond national borders.”

The IAASB points out that such conditions make it challenging for management of entities, those charged with governance, and auditors to do their jobs.

According to the board, among the tough aspects of this groups' responsibilities are assessing an entity's ability to continue as a going concern and making relevant disclosures in the financial statements and auditor's report.



(In accounting, the going-concern concept assumes that an entity will continue operating indefinitely. Therefore, its accounts are prepared accordingly and there's no need to reflect the possibility that the entity will soon grind to a halt and its assets sold off.)

The board reminds auditors of the requirements of the International Standards on Auditing (ISAs). It adds that in every assignment, an auditor must weigh whether it's appropriate for the management to use the going-concern assumption.

Said IAASB chairman Professor Arnold Schilder: “Difficult economic conditions give rise to many important audit considerations, but none more important or more difficult than evaluating management's assessment of an entity's ability to continue as a going concern and determining the appropriate auditor reporting in the circumstances.”

What's interesting is that the board has asked auditors to refer to a three-year-old document titled Audit Considerations in Respect of Going Concern in the Current Economic Environment.\

“While this Audit Practice Alert was released in context of the 2008-2009 credit crisis, many of the matters addressed in it are equally relevant today,” said Schilder.

“For example, an entity may be experiencing a decline in its financial health, or may have material uncertainties arising from direct or indirect exposures to sovereign debt of distressed countries. Auditors are therefore encouraged to review the Alert and, importantly, the relevant requirements in the ISAs.”

On Wednesday, the Malaysian Institute of Accountants (MIA) came out with a circular that's largely based on the IAASB press release.

Says MIA executive director Ho Foong Moi in the circular: “Auditors in Malaysia similarly should take cognisance of the currently-challenging global economy and accordingly must remain alert throughout the audit to identify and critically examine evidence of events or conditions that may exist nationally or globally which may cast significant doubt on an entity's ability to continue as a going concern.

“Auditors must continue to exercise professional scepticism and judgment in evaluating financial-statement disclosures and the implications for the auditor's report when a material-uncertainty exists relating to events or conditions that, individually or collectively, may cast significant doubt on the entity's ability to continue as a going concern.”

So, the message is clear these days, auditors have to be more questioning about the standard-management assumption that a business is in a position to go on and on. After all, which management will readily admit that the entity is reaching the end of the road?

The truth is, many businesses fail, even in the best of times. And when the economies and industries go through rough patches, it's harder to hide flaws in business models and weaknesses in how businesses are run. And when this happens, many people depend on the accountants and auditors to raise the red flags.

Therefore, the huge economic uncertainties we're experiencing now are as much a test of the profession's alertness and integrity as they are a test of the businesses' strength and resilience.

Executive editor Errol Oh didn't like tests when he was in school and that hasn't changed. But now he at least recognises that testing serves a purpose.