Lessons from the Legacy of Lee

Something uncanny happened when I took the time this week to look through various obituaries and commentary pieces about Lee Kuan Yew, the legendary leader of Singapore who died last week.

Quite by chance, I found an intimate connection to the three blogs I had posted in March. The piece on ignorance highlighted the downsides of excessive democracy – something Lee felt so strongly about that he stifled democracy in his own nation. Then came the piece about Asia’s chance, with of course Singapore being something of a poster child. The same connection can be made to the blog about ease of doing business, where Singapore has been long established as number one.

True to form, everyone is trying to dissect the career of Lee to see if there are more general lessons available. And true to form, we tend to be rather selective, emphasizing lessons that conform to our own dominant logic and downplaying those that seem to reject it. This learning business is hard.

What is hard to deny is the phenomenal success of Lee and of his country while he was its leader. The graph of GDP per capita in the Economist was one of the most telling charts I can recall. When Lee came to prominence, Singapore languished behind Indonesia, China, Malaysia and pretty well everyone else. Progressively, each of these was overtaken, and eventually Singapore even overtook the USA to become one of the richest countries in the entire world by that metric.

Now, GDP is not everything. But Singapore does pretty well on many other well-being metrics as well, from life expectancy to education proficiency to alleviation of poverty. True, civil rights are far from exemplary. But I am pretty sure that most visitors from other planets would rather accept the living standards of Singapore together with the restraints to liberty, compared with freer, less affluent alternatives.

I found several policies and factors that could have influenced the success of Singapore, that might have lessons for others.

The first is the political system. Lee was ruthless in stressing meritocracy and in protecting his land from what he saw were the vagaries of excess democracy. The result came close to dictatorship. His party has held power continuously for over fifty years. Elections are held, but the boundaries seem to be rigged and the seat allocation set to favour his incumbent party. Within the party, he made sure his own voice held sway. He also harassed dissenters and was highly litigious. The resulting system came much closer to China than to European models of democracy.

Lee tried to balance this by making sure he received sound advice. He started many dialogues with the populace, carefully controlled, when an issue called for it. He looked outside his own country for the very best ideas. And most important, he made sure he had the world’s best and least corrupt civil service, ensured by ruthless suppression of corruption and by paying public servants very well.

It will be interesting to see how this system performs now Lee is dead. His son is now in power – always a warning sign – and the leadership is hardly diverse ethnically, so suggestions of cronyism ring true. Even in business, great leaders seldom pay sufficient attention to succession planning.

Of course, Lee’s system is critically dependent on the top leader. When the leader is respected, somewhat humble and benign, success can follow. Having a powerful leader allows a strategy to be defined and followed over many years, not blown off course by the latest fad or statistic, and enabling the tougher actions to be followed through with less compromise than in a more democratic system.

The downside is obvious too. What if the strategy is wrong? What if the leader has quirky ideas that alienate? What if the leader becomes hubristic or greedy or nepotistic? What happens when the leader grows old or dies?

Lee epitomizes both the positive and risky aspects. Most would say the benefits have outweighed the disadvantages, and Singapore has been lucky to have had him as their leader. But that doesn’t mean every country should adopt such a system. Lee’s quirks were also plentiful. His obsession with tidiness lead to draconian laws, famously including one about disposal of chewing gum. He appeared homophobic, and often seemed to favour policies close to eugenics.

It is often written that Singapore has no natural resources. I beg to disagree. The strategic location and the port are fantastic natural resources that Lee exploited to the full. Logistics advantage can be as powerful a resource as any other.

His demographic policy was fascinating, exploiting the small scale of his country and its proximity to ambitious, mobile people. The border was open, and he made Singapore attractive to people of ambition and merit. He tried to make this policy blind to race and privilege and religion, and to a great extent succeeded. Key to this was his housing policy, which ensured inter-mingling of races and affordability for new arrivals. He also made sure the housing stock and other infrastructure kept pace with the growth of population.

Linked to this was a policy to make Singapore attractive to the sort of arrivals he wanted, and attractive not just as a fly-by-night short-term destination but a place to put down roots. A lucky legacy for this were his divorces from first Britain and then Malaysia, which created a loyalty and patriotism that other city states don’t enjoy. He maintained this by continuing with strong armed forces and conscription. You had to buy into Singapore as more than just a place to make lots of money.

So what lessons can be drawn more widely from the phenomenon of Lee Kuan Yew, either for countries or corporations or even individuals?

First, long-term strategy is better than short-term fixing. There are many available good strategies, not all work in all circumstances, but strategy requires intelligence, and usually builds on core strengths.

A consequence is that strategy itself has become an undervalued discipline in corporations, often outsourced to greedy consultants. Further, core strengths are critical, in Singapore’s case the port and the nimble scale. Amazon is an example of a company with a consistent strategy built on core strengths. Rwanda is an example of a country with the same. A further consequence could be that some combination of Asian and Western corporate governance models is best.

Next, execution of long-term strategy requires strong leadership with a mandate. Usually that involves a gifted single leader with a long time horizon.

A consequence is that too much democracy can undermine progress. A dilemma is how to choose such a strong leader – in most cases there is more chance than any selection process involved. And a system with concentrated power but the wrong leader is the worst system of all. In the corporate world, it is possible to define recruitment criteria, incentives and checks and balances – in countries sadly not, at least so far. Wouldn’t it be great if international bodies were so strong as to be able to monitor country leadership?

Next, even a strong leader is rarely perfect. Lee has his quirks. Everyone grows old, and most grow greedy or cynical or nepotistic. Few think adequately of succession. The consequence is for what checks and balances that exist to focus on those areas rather than more short-term factors – again possible in a corporation, impossible so far in a nation.

Next, even a strong leader has to retain credibility. This must be real not the ephemeral credibility from propaganda and fear and short-term wealth. It can come from the luck of loyalty from something like a war, and be supported by policy, in Lee’s case conscription and some humble dialogue.

Finally, a smart strategy identifies key levers. In Lee’s case, these included immigration and housing policy and a well-funded civil service. Actually, those two might be pretty universal, and most governments under-prioritise them.

Rest in peace, Lee Kuan Yew, all humanity, and especially those blessed with Singaporean nationality, have a lot to thank you for and a lot to learn from you.