Chapter 17 - Conversations with Lee Kuan Yew: Citizen Singapore: How to Build a Nation
Today’s Chapter is based on the book “Conversations with Lee Kuan Yew: Citizen Singapore: How to Build a Nation” by Tom Plate.
Buy it on Amazon here:
https://www.amazon.com/Conversations-Lee-Kuan-Yew-Singapore/dp/9812616764
Here’s what I learned from the book:
Intense Ideology Kills
“It doesn’t matter whether a cat is black or white as long as it catches mice.”
— Deng Xiaoping
Charlie Munger, the Vice-Chairman of Berkshire Hathaway, is well known for his famous 1995 speech he gave at Harvard University on the Psychology of Human Misjudgement. In his speech, Munger explained how cognitive biases can lead to poor decision-making. These cognitive biases can be caused by a variety of factors, including our experiences, our emotions, and our ideologies.
Notably, Munger has repeatly warned on the danger of having an intense ideology:
“Another thing I think should be avoided is extremely intense ideology, because it cabbages up one’s mind. You’ve seen that. You see a lot of it on TV, you know preachers for instance, they’ve all got different ideas about theology and a lot of them have minds that are made of cabbage.
But that can happen with political ideology. And if you’re young it’s easy to drift into loyalties and when you announce that you’re a loyal member and you start shouting the orthodox ideology out what you’re doing is pounding it in, pounding it in, and you’re gradually ruining your mind. So you want to be very careful with this ideology. It’s a big danger.
In my mind I have a little example I use whenever I think about ideology, and it’s these Scandinavian canoeists who succeeded in taming all the rapids of Scandinavia and they thought they would tackle the whirlpools in the Grand Rapids here in the United States. The death rate was 100%. A big whirlpool is not something you want to go into and I think the same is true about a really deep ideology.
I have what I call an iron prescription that helps me keep sane when I naturally drift toward preferring one ideology over another. And that is I say “I’m not entitled to have an opinion on this subject unless I can state the arguments against my position better than the people do who are supporting it. I think that only when I reach that stage am I qualified to speak.” Now you can say that’s too much of an iron discipline… it’s not too much of an iron discipline. It’s not even that hard to do.”
Similarly, Lee Kuan Yew, widely regarded as the founding father of modern Singapore, was not fond of having a specific ideology while governing. For him, it was all about finding a solution that worked no matter where it came from. It is by being an “utilitarian” that he was able to transform Singapore from a small and impoverish British colony into a prosperous, modern city-state with a strong economy, efficient government and high standard of living.
"I don't think in those terms. I am not great on philosophy and theories. I am interested in them, but my life is not guided by philosophy or theories. I get things done and leave others to extract the principles from my successful solutions. I do not work on a theory. Instead I ask: what will make this work? If, after a series of such solutions, I find that a certain approach worked, then I try to find out what was the principle behind the solution.”
— Lee Kuan Yew
“So, Plato, Aristotle, Socrates, I am not guided by them. I read them cursorily because I was not interested in philosophy as such. You may call me a 'utilitarian' or whatever. I am interested in what works."
— Lee Kuan Yew
As a matter of fact, Lee Kuan Yew’s guiding principle is to review all solutions and to choose the solution with the highest probability of success. If his proposed solution fails, then he will go over the alternatives solutions and find another way. By not being guided by a philosophy or a theory, Lee Kuan Yew didn’t need to force himself into chasing ideas when they didn’t work:
“I chase ideas provided they work. When they don't work, I say, look, this idea maybe sounds bright, but let's try something that works. So we try something that works, let's get it going.”
This concept reminds me of the idea of meritocracy while running a company. As we have learned from Sam Zell, a meritocracy is a management philosophy that emphasizes the concept that the best ideas can come from anyone within the organisation. As such, it is important to give a voice to all employees no matter what their seniority or their job title are.
“At our core, we are a meritocracy—an environment that Bob and I cultivated in the early days. A meritocracy gives you the freedom to be yourself by eliminating superficial markers, so you are measured only by what you produce. In essence, it is an equalizer that focuses everybody on what’s important so you have the opportunity to reveal your best. Once you’ve worked in a true meritocracy, it’s very hard to settle for anything else.”
— Sam Zell
This philosophy of meritocracy was also found in the way Steve Jobs managed Apple. Jobs truly believed that good ideas could come from anywhere and that everyone in the company should be seen as equals in terms of idea generation:
“I would say Apple was a corporate lifestyle, but it had a few very big differences to other corporate lifestyles that I’d seen. The first one was a real belief that there wasn’t a hierarchy of ideas that mapped onto the hierarchy of the organization. In other words, great ideas could come from anywhere and that we better sort of treat people in a much more egalitarian sense, in terms of where the ideas came from. And Apple was a very bottoms-up company when it came to a lot of its great ideas. And we hired truly great people and gave them the room to do great work.”
How to be a Leader
“The most successful leaders are those adept at communicating their vision and values with passion and enthusiasm.”
— John Baldoni
As we have learned through the inverted management philosophy from the Home Depot, the store associates are the most important individuals in the company as they are the one interacting with the customers and building the image of the company with the customers.
“They are the ones who will have the product knowledge and be able to show the customer how to use it. They are the heroes of the company, the ones who create a cult among our customers. We're trying to make our customers bleed orange.”
— Bernie Marcus & Arthur Blank
By consequence, the biggest responsibility for a company’s leader is to communicate the company’s vision and values to their employees. This can only be done when leaders are great motivators. As a matter of fact, employees will only buy into the company’s culture if the leader is able to make them believe in it.
For example, when Isadore Sharp implemented Four Seasons’ policy for senior managers to treat their front-line staffs as equals, it was quite the challenge for him to sell this concept internally as he needed to convince them that this was a winning strategy.
“That’s going to be your managerial challenge: reaching our goal of being the best, down to the bottom of our pyramid—motivating our lowest-paid people to act on their own, to see themselves, not as routine functionaries, but as company facilitators creating our customer base.”
— Isadore Sharp
“Conceiving a winning strategy of service had been relatively easy. Selling it internally—getting it across to all the hotel managers and supervisors, design staff, purchasing people, and engineers—was proving exceedingly difficult. We needed to get it down to the front line: clerks, bellstaff, bartenders, waiters, cooks, housekeepers, and dishwashers, the lowest-paid and in most companies the least-motivated people, but the ones who would make or break a five-star service reputation.”
— Isadore Sharp
Similarly, the need of being a great motivator as a leader is also required when running a city. Lee Kuan Yew mentions that a leader’s job is notably to communicate his or her feelings to others and to be a great motivator. That is the key factor to lead people in the right direction.
“Well, yes, because, I mean, to be a leader, you must be able to communicate your feelings and move the other fellow. It's not just ideas, you know.”
— Lee Kuan Yew
“At the same time, he accepts that motivating people to move forward in the right direction is the leader's job. He is clear on that. In some way, shape or form—whatever the system, voting or no voting—a true leader takes people with him, and doesn't try to beat them back.”
— Tom Plate on Lee Kuan Yew
This is especially true in times of difficulties; a leader must continue to inspire and motivate its troops. The worse thing to do would be to discourage people with bad thoughts. Furthermore, a good leader needs to make firm decisions especially when they are made against strong opposition or against public opinion.
"No, your job as a leader is to inspire and to galvanize, not to share your distraught thoughts. You make your people dispirited." — Lee Kuan Yew
“Lee Kuan Yew does not see how it is possible to rule very wisely if one does not rule very firmly. Strong leaders make hard decisions that stick. Weak leaders make bad situations worse by deciding poorly or not deciding at all.”
— Tom Plate on Lee Kuan Yew
As a matter of fact, this can be seen with CEOs of listed companies. One way to differentiate between strong leaders and weak ones are to see if their decisions are focused on the short-term or the long-term of the company. For example, weak leaders will make short-term decisions to meet with Wall Street’s next quarter’s expectations, whereas strong leaders do not mind making decisions that will lead to a short-term setback but will surely bring a long-term benefit to the company.
As Jeff Bezos would say, it is important for a leader to focus on the long-term:
“We will continue to make investment decisions in light of long-term market leadership considerations rather than short-term profitability considerations or short-term Wall Street reactions.”
“Acquire worldly wisdom and adjust your behavior accordingly. If your new behavior gives you a little temporary unpopularity with your peer group…then to hell with them.” — Charlie Munger
Finally, Lee Kuan Yew also mentions that it is a leader’s job to find a competent successor who will continue to lead. This is essential to the continuance of a system’s success. Similarly, it is quite common for successful companies to lose their magic after the departure of their founders. For example, Apple definitely lost a step in 1985 when Steve Jobs was forced out of the company. Luckily, the company was able to become a technology giant upon Jobs return to Apple in 2000.
“After succeeding, my next job was to find successors who would carry on the system because if it breaks down, then all that I have done will come to naught.”
— Lee Kuan Yew
Beyond the Book
Read "The Revised Psychology of Human Misjudgment, by Charlie Munger" by Farnam Street
Watch "How to have an idea meritocracy in any organization" by Ray Dalio