BUSINESS leaders have a critical role in leading digital transformation that can build up the country's "adaptive capacity" amid the Covid-19 pandemic, said Deputy Prime Minister Heng Swee Keat at the 35th Singapore Business Awards (SBA) dinner.
"Covid is not over; it is still raging around the world ... We cannot predict everything that's going to happen. But as we see, many of the companies that have successfully navigated this were prepared for change.
"When the change was so sudden that it became a shock, they were able to continue to manage the shock. So if we are prepared for change, (then) whether the change is incremental or ... sudden, I think we will all come out of it stronger. That's how we build our adaptive capacity."
He was speaking about the business and economic impact of the pandemic in a panel discussion with Wong Wei Kong, chairman of the SBA organising committee and editor of The Business Times, and Christopher Ong, managing director of DHL Express Singapore.
Attended by nearly 50 guests, the SBA dinner was held on Nov 24 at the Singapore Press Holdings auditorium, with safe-entry and safe-distancing measures in place. The awards recognised business leaders who have not only built up strong companies, but also adapted and thrived in the pandemic.
Forrest Li, founder, chairman and chief executive of consumer Internet giant Sea, clinched the Businessman of the Year title, and NTUC Enterprise and FairPrice Group chief Seah Kian Peng was named Outstanding Chief Executive Officer of the Year.
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Jessica Tan, group co-chief executive of Ping An Insurance (Group) Company of China, won the Outstanding Overseas Executive of the Year award. Semiconductor and electronics solutions provider AEM Holdings received the Enterprise Award.
Congratulating the winners for their resilience in a challenging year, Mr Heng noted that the pandemic has thrown up plenty of uncertainties for Singapore. There are a range of issues to tackle - from the future of work and political uncertainties abroad to the interplay of globalisation and technology.
"I would say that so far we have made good progress; let us continue to ensure that we make good progress in this (situation). But at the same time, even as we are down in these trenches fighting Covid, let us not lose sight of the long-term direction," said Mr Heng, who is also Coordinating Minister for Economic Policies and Minister for Finance.
He added: "Our position in the world will be changing. How we continue to be relevant and useful to the world will be a major issue for us. And that is why, for all of us, even as we are fighting the day-to-day issues, we have to think ahead and say: 'How do we get out stronger, three years from today, five years from today, 10 years from today, and have a longer-term horizon?'"
Unprecedented
Unlike previous crises, the current pandemic carries an unprecedented tension between public health and economic priorities, or as many have termed it, the choice between "saving lives and saving livelihoods". This has put many businesses in a tough position globally.
One important lesson Singapore has learned about this tension is that managing the pandemic must still be the first priority, said Mr Heng, in response to a question from DHL's Mr Ong about how the current pandemic can prepare Singapore for future crises.
"Even as we gradually resume our activities, we must not let our guard down. If you look at all the countries around the world, when the guard is down, there is a resurgence of the Covid pandemic and you find that it makes recovery subsequently harder.
"I would say that in terms of saving lives and saving livelihoods, I don't see it as one or the other, it's not a binary choice. The better we are able to manage the pandemic, the better we are able to protect jobs."
The current economic climate has some similarities to past calamities such as the 1997 Asian Financial Crisis (AFC) and the 2008 Global Financial Crisis (GFC), he noted.
"The similarity is that it is a sudden shock, and that shock sends reverberations around the whole economy. As a result, you find that activities come to a very sharp slowdown, very quickly. When there is a loss of confidence, investors stop investing, consumers cut back on their spending," he said.
For instance, during the AFC, the flow of funds "jammed up very quickly". During the GFC, "confidence dropped so sharply that trade financing, for example, dried up; even sectors that were doing well nosedived", he noted.
"But one major difference is that this recession has been triggered by the Covid pandemic. And therefore, the economic trajectory depends critically on the trajectory of our ability to manage this pandemic," he said.
Singapore had doubled down on containing the spread, even though the situation became challenging for both workers and businesses. "We had very strict measures about containing the spread of the virus, including the circuit-breaker period that we had to impose. (While) it is awfully painful, I think it helped us in managing the pandemic a lot better," he said.
Another key learning point from the pandemic is that risk management has now become indispensable to Singapore - not just from a national perspective, but even at the level of companies and workers. All stakeholders will need to think through possible scenarios and work to maximise the upsides while managing downsides.
"To expect that things would just go on as normal is unrealistic, because I would say that things would change even faster. So, raising our adaptive capacity to change will be critical. Raising our ability to stay resilient, to be able to manage (and) identify risk, will be critical," he said.
Mr Heng later added: "The development of the economy does not have to be at the expense of resilience. Because if you are able to manage the risk well, trust in the particular company and the particular economy will grow."
Going digital
For such innovation to occur, business leaders must help to guide digital transformation. They will need to focus on redesigning jobs and reskilling their workforce to help prepare for the future of work, particularly as workers come under the "stresses and strains" of the pandemic.
"Covid has also accelerated trends which were going on, in particular, digitisation. What it means is that changes are going to be faster, and the stresses and strains on people will be even greater - in particular, the stresses and strains on workers, because of having to cope with all these changes," he noted.
Government initiatives, such as the Jobs Support Scheme, have been designed to deal with the economic and social issues surrounding the pandemic. But even at the company level, leaders can play their part in helping workers.
He said: "I think the stress on the workers in having to adapt to this change will be very significant. So it's important for us, as business leaders, not to just think of our own bottomline, but how do you take care of our workers, how to bring the workers along.
"The redesign of jobs and the retraining (and) reskilling of workers will be a critical part of this. And I hope that we can do all this together well. And this is how we can emerge stronger, because Covid is going to change the landscape significantly."
Citing robotics and AI as two major forces that will change jobs, he added: "I have seen ... companies which have been able to change their work practices to make the best combination of man and machines... As they take care of their bottom lines, they are also taking care of their workers, and that is what we must strive for."
Staying open
Another significant challenge for business leaders amid the pandemic is talent acquisition.
As BT's Mr Wong noted, there is currently a tension between businesses' demand for talent and the desire for a stronger "Singapore core" of workers. This has put scrutiny on how open Singapore will be, going forward.
When asked how the country will address this tension going forward, Mr Heng said: "Singapore's karma, and I would say many countries' karma, is always to manage this duality."
Mr Heng reiterated the importance of Singapore staying open. This is because when it comes to persuading companies to set up global or regional headquarters, the Republic is competing with the best global financial centres, such as London, New York, Shanghai, Hong Kong and Mumbai.
To continue to benefit from global flows of talent, capital and goods, Singapore has to stay plugged into the world while taking care of its own people. "Managing this duality will always be a part of our policy framework," he said.
"We must stay open to having some of the best people in the world to come and work together with us. And in the process of working together, in the process of osmosis, I believe Singaporeans will benefit from it."
He added: "In order to make that happen, we should also ensure that in that process, the very open nature of our immigration policies and manpower policies is not exploited."
The Ministry of Manpower, for instance, keeps a list of employers who discriminate against Singaporeans - a practice he described as "not acceptable".
In cases where companies have to let go of workers, it will also be important to help workers to make the transition. In this regard, Mr Heng said that he is "personally very supportive" of the Job Security Council, an initiative by the National Trades Union Congress (NTUC).
Ultimately, it is all about ensuring that "we can have measures to move workers from industries that either are not doing well or have to restructure, into new growth sectors", he said.
Polarised landscape
The continuing Covid-19 pandemic comes against the backdrop of greater political turmoil.
Referring to the outcome of the recent US election outcome, he said that although President-elect Joe Biden could shape a new course, it is too early to say.
Meanwhile, the "fundamental uncertainties" articulated by President Donald Trump remain. Both Republicans and Democrats also have significant differences to deal with.
Mr Heng expressed hope that, despite the polarised landscape, global leaders appreciate that ths is an inter-connected, interdependent world. "For issues which need global cooperation - whether it's dealing with a pandemic, whether it's dealing with a more secure supply chain and so on - you do need to have that level of confidence in each other to build that cooperative structure."
A more volatile world means that corporate Singapore will have to be resilient. Mr Heng urged business leaders to stay focused on building credibility.
"I think trust will be a valuable asset for individuals, for companies, for countries. We must strive to continue to maintain high standards as well as to be able to facilitate new, innovative activities," he said.