Thursday, February 4, 2021

Can we think “out-of-the-box”?

How different are we today versus that faithful day – 4th July 1946 – when the Americans gave us our independence?

Then consider where Japan is and where Vietnam is – and the rest of our neighbors – today and where we are. We all live on the same planet and subject to the same elements.

But can we forward-think? If we go by what we in the chattering classes are pontificating the last dozen years – the blog’s reference point, its lifespan – what do we see?

We’re still about poverty being our be-all and end-all.

Let’s dissect that. For example, is that why we shelter our kids – and see them as perpetual juveniles?

And to keep our blinders on, we stick it to the wealthy nations for not respecting our values – hierarchy, and paternalism?

On the other hand, we take it for granted that ours is a culture of impunity – ranked below average in the global corruption index, inferior to our neighbors, and can only match a nation like Moldova. Likewise, ours is a “flawed democracy.”

In other words, because of our value of paternalism, we expect the rest of the world to treat us with kid gloves, inferior – as opposed to peers – to others. And what a self-fulfilling prophesy; unsurprisingly, we are the regional laggard, characterized by persistent, abject poverty.

Humankind were cave people and tribal – and warring – because of the instincts to survive. Think of Darwin. There is no free lunch.

Of course, we can claim there were no Adam and Eve. Yet, we like to quote the Bible. And the moral of the story is even in Eden; there was Satan. And even more profoundly, we have to fend for ourselves.

Because the story of creation says, humankind is good – made in the Creator’s image and likeness. And we did not disappoint. Private citizens are prepping to go up in space when not that long ago, “shooting for the moon” was merely a metaphor.

Organisms, people, enterprises, nations – and the world itself – have something in common. They all develop.

Should we accept taking the wrong fork time and again, that we’re lost – and can’t course correct?

Are we like a 75-year-old Bondying?

This universe is spinning like never before. And so, instead of taking stock of where we are, are we instinctively pointing to others to justify our failings?

Recall the hardy mindset or the 3Cs derived from neuroscience: (1) Commitment; (2) Challenge; and (3) Control.

We must commit beyond the war on poverty; we must commit to traverse poverty to prosperity. And we should take the more significant challenge and then take control. We control only ourselves and no one else. We must find our place in the sun; it isn’t free, offered on a silver platter.

Sadly, our caste system makes us a pariah. We look up to hierarchy for paternalism; instead, we must look outward, partake of the magic of the universe – as in the story of creation.

And in particular, the photosynthesis phenomenon. There it is, like a North Star; it shows us our place in the sun.

That is how we can mimic how to thrive in this dynamic universe.

From “food security” to “national security” and beyond, we fall into the trap of binary thinking. It is understandable because we haven’t scaled the development curve like our neighbors.

Let’s take rice as an example. We had a leg up versus our neighbors with IRRI in our backyard. The buzzword – i.e., food security – narrows our worldview and pins us down to a fixed mindset.

To think out-of-the-box, we must develop a growth mindset. It is beyond logical, linear, and incremental thinking. Sadly, the brain’s chamber responsible for forward-thinking, lateral, and creative thinking, is not well developed in most people.

Instead of food security, if our mental model is the photosynthesis phenomenon, we will be guided by an ecosystem’s imperatives.

Unfortunately, we fall into our comfort zone because of our caste system – as in the value of hierarchy and paternalism.

If that value is a redeeming one, how come our top eight companies can’t match one Vietnam enterprise’s economic contributions? Yet, our instinct is tapping tycoons when we can search far and wide to leverage what the world has to offer? 

Every one of our neighbors did not suffer this predicament we continue to face in infrastructure development, for example.

Recall Mahathir – as did Lee and Deng – demonstrated forward-thinking and tapped their former colonizer and the West to leapfrog Malaysia’s development. And he did not succumb to the crab mentality – or parochialism – and prioritized KL over his hometown.

But back to our top eight companies. They cannot match the economic miracles delivered by our neighbors – they begged for Western money and technology.

In other words, our economic managers and legislators must recognize that we cannot keep to an inward-looking model to pursue economic development – and nation-building.  

And if we are to beg for foreign money and technology, we better forward-think – and visualize how a wealthy nation looks. And our neighbors are right next door; we can learn from them. 

For example, we must craft very targeted fiscal and monetary policies to yield the biggest bang for the buck. That is why the blog raised the focus on our top export industries and replicate the Vietnam model. In other words, toss the crab mentality and prioritize. 

We must have the ecosystem – to sustain an export-driven enterprise – and replicate the Pearl River Delta experience.

We cannot keep figuring out how to squeeze blood out of a stone by our inward-looking bias.

If our top companies are not world-beaters, what more of our agribusiness and MSMEs?

Sadly, to reprise, we have not scaled the development curve that we’re a novice in nation-building.

For the benefit of our MSMEs, here’s how my Eastern European friends scaled the development curve: (1) The Genesis – 8 years of entrepreneurial efforts, a losing proposition, to gain acceptance of local trade of their up-and-coming economy and low-priced brands; (2) Establish a going concern – 3 years of ascertaining core business, attained stable margins against low-cost overhead; (3) Profitable growth phase – the commitment to brand innovation and market investment and development, generated excess profits/investment funds to expand manufacturing capability and embrace state-of-the-art technologies; (4) Sustainable, profitable growth phase – expanding global reach and geography, generating double-digit profitability; (5) Competitive advantage – the enviable position to pull the rug from under global peers.

While the above addresses our MSMEs, our top companies must recognize that the development curve is not delivered on a silver platter – courtesy of political patronage and oligarchy.

Consider: South Korea leads the world in innovation per the 2021 Bloomberg Index. Singapore is second. The Philippines did not even make it to the list of 60. While Malaysia, Thailand, and Vietnam did. Recall that South Korea, before Samsung and LG became household names, organized a group to attend an Ivy program in New York, including a visit to my MNC-company’s technology center. And I played host at the request of a professor-friend. And I would not imagine South Korea beating both the US and Japan – both recognized as pioneering and leaders – in innovation. 

Let’s get back to the development curve. And please take note: It is subject to the point of diminishing returns. But that is why an economy is a cycle. And the bust brings recession at the macro level; that translates to restructuring for enterprises that give rise to disruptive innovations, ushering in a new era.

And since the millennials now outnumber the baby boomers, we can expect change at a faster clip, beyond warp speed. But that is merely mirroring the character of this dynamic universe.

In the meantime, our mental model must pull together our (a) top enterprises, (b) agribusiness, and MSMEs; to learn the ropes of development and nation-building.

For example, look at the eight years referenced above – albeit they are a small market of fewer than 8 million people – when the enterprise did not make money. In other words, the crab mentality cannot be the guiding principle of Juan de la Cruz.

The same applies to food security and national security.

In the first place, it is beyond food security. We want an ecosystem that is sustainable and will put food on Juan de la Cruz’s table. And that ecosystem includes the R&D piece courtesy of IRRI. In other words, Philippine rice must be globally competitive, i.e., that it has economies of scale and sustainability – notwithstanding Vietnam or Thailand.

Beyond food security, we want an ecosystem that will make our industry world-class.

Forward-think. Forward-think. Forward-think.

National security is the same. We cannot fall into the knee-jerk trap. That China is now the largest economy, and so we must be in bed with them. Nor should it be Russia.

It comes down to the principle, not the rule. Recall democracy is the mirror image of Christianity – to embrace personal responsibility for the common good; it is not to subordinate public virtue – as in love thy neighbor – to one’s ideology a la the scribes and Pharisees. Or the present-day Padre Damaso, aka the far-right ideology.

We must learn to forward-think if we are to figure out what the future holds for us.

And we will not be able to “think-out-of-the box” if we can’t toss our instincts: We are parochial and insular. We value hierarchy and paternalism and rely on political patronage and oligarchy that ours is a culture of impunity.

Gising bayan!

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