Need for Mindset Change

Released by: The Edge
Date: 26 February 2007

Why are some companies highly successful in spotting trends and exploiting the opportunities for innovation and growth, while others are so badly managed and need to be bailed out time and time again? The core problem, most probably, lies in the dire need for a mindset change and a paradigm shift in performance behaviour.

The mindset encapsulates all that is inherently ingrained in us: assumptions, biases, mental images, feelings, views, traits, beliefs and values developed over the course of one's lifetime through a process of learning from various teaching, practices and experiences. The collective mindset of an organisation or nation, if well developed and practised, becomes a most powerful mechanism for advancement.

An organisational mindset is essentially the collective mindset of all the individuals contributing within it, so the amount of influence an individual has on the organisation depends on one's position in the hierarchy. Sometimes the personal mindset of the CEO becomes the single most important factor in shaping the organisation's mindset - from business strategy and direction to corporate culture and the level of corporate social responsibility. The mindset is a point of origination of all work behaviours - how people perceive problems and determine their responses - the foundation upon which the values and distinctive capability of a company are built. It even determines the level and extent to which the management values the differences and cultural diversity in an increasingly global economy.

Developing the right mindset change is the key differentiator between winning and losing organisations. What type of mindset change will it take for Malaysian businesses to be able to compete globally? As doing business in Malaysia has changed dramatically since the 1997 Asian financial crisis and the emergence of China and India, the Malaysian mindset must accommodate the changes.

So what about globalisation?

Globalisation is characterised by trade liberalisation, intense market competition, converging technologies, rapid innovations in business models, unexpected shifts in consumer tastes, continued pressure on productivity and quality in an environment where we compete to get the best talents and fight over a limited profit pool.

Change as a result of globalisation is all around us. For instance, with the Asean Free Trade Area (AFTA), our national cars must now compete with competitively priced and higher quality Toyotas from Thailand. The protectionist policy for Proton is fast being eroded and the old mindset of dependence on the government for preferential treatment must give way to a culture of excellence and high performance to compete innovatively. This applies not just to government-linked companies (GLCs) but also to the private sector. To compete innovatively means creating new business models and value innovation that can render rivals obsolete. This calls for a totally new mindset, constant vigilance and reinvention.

Global Diversity - think globally and act locally

To be an effective global player, we need to change our mindset to "think, breathe and act both locally and globally". This slogan captures the need to think out a business in global terms while tailoring products and services to local and global needs. Innovative countries like Switzerland, Sweden and Denmark, because of their small domestic markets, adopt this `glocal mindset'.

Global managers view the entire world as their untapped talent pool and emphasise diversity in their recruitment as opposed to a country-centric approach with fully controlled subsidiaries in each country of operations. Experienced global managers and executives know that when companies go to other countries and try to replicate the whole work environment that they are used to at home, they find limited success. Instead, they must first recognise what the country and the culture they are in look like, and reflect that in the work environment. That's "acting locally".

Research has shown that a more diverse organisation can better cope with changes. A good example of a truly global top management team is Adidas, the German-based sportswear company where the board consists of two Americans, two Frenchmen, two Germans, a Swiss, a Swede and an Australian. The chief executive himself is a Frenchman. Such diversity generates a tremendous number of ideas culled from different cultures, experiences and educational input.

Changing our mindset for success

As such, an open mind and soft skills become indispensable. Discrimination of any form must be avoided. The most dangerous thing to do is to stereotype and put form ahead of substance.

Changing our mindset for success

Management and leadership styles of managers must also shift from the `command and control' genre to the more intuitive, highly collaborative `enrol and enlist' approach. Managers should play the role of a coach or facilitator and `human capital builder' instead of "the big boss". Managers of the future must hone their people skills; learn to bring out the best in people and to value each team member's contribution, regardless of rank and diversity. This creates a positive environment that motivates people to learn and grow. Nothing can be more competitive than an inspired, well-motivated and innovative workforce.

So, if we want to become a developed society, we must first learn to get rid of the mentality of short-term gains and develop a mindset of excellence, achievement and high performance for long-term competitiveness and success. And exactly how can Malaysian managers develop this `developed mindset'?

First, discard all preconceived thinking. Don't limit your minds; think and look beyond. Stop being a slave to the entrenched system, take responsibility for your personal actions, work on solutions rather than just problems, stick to the moral values of integrity, and swim against the tide of scepticism and discrimination. Work hard to develop, execute and nurture creative plans and strive meritoriously to be the leader others can emulate. Then you can be sure a changed mindset will arise within the entire organisation or nation. If we can accomplish this today, we do not have to wait till 2020 to achieve the aspirations of our national vision.