Keep your eyes on the prize, MDEC
By Karamjit Singh January 23, 2021
- Despite leadership weakness Surina Shukri given 2nd chance by chairman
- Rebuild management ranks, reshape MDEC into its strongest version yet
What was bubbling within the MDEC community, including active chat groups of senior ex-staff, came into the open on Wed with some media reports claiming major discord among the senior management ranks at the agency I consider the tip of the sword, in Malaysia’s efforts to transition to a Digital Economy – Malaysia Digital Economy Corporation (MDEC).
The crux of the matter seems to be their unhappiness over the poor leadership they accuse Surina Shukri (pic, left), CEO of MDEC, coupled with the overbearing role the chairman, Dr Rais Hussin, has been playing – though at least one former MDEC board member feels that is needed, for now.
I personally do not believe we should be focused too much on senior leadership movements or disagreements within the agencies that are promoting and driving technology adoption because accelerating and ensuring this adoption is a tough enough challenge without the distraction of personnel moves being questioned.
If MDEC today, then how soon before someone points to Cradle Fund Sdn Bhd and highlights a similar dynamic playing out there with a dominant chairman and a new, inexperienced (in terms of startup ecosystem), CEO? Is that helpful to anyone?
Having said that, what is going on at MDEC does now warrant a closer look, if only to ensure things are being done for the right reason and everyone keeps their eyes on the prize… to ensure Malaysia successfully transitions to becoming a leading digital economy in the world and thus enjoying the benefits of such a transition.
And as usual, the most inaccurate but sensational headline, is the one that made the rounds on Wednesday, a tweet posed to the MDEC chairman on whether it is true that there have been “mass resignations” with 16 senior executives leaving. As MDEC has made clear in a press release, that is not true. But in today’s social media dominated news cycle, the truth is often a blunt and slow moving reaction to a spicy, naughty and viral post about apparent large scale resignations at a leading public agency.
[Ed: Paragraph updated for accuracy.]
So, the truth is that eight senior executives have left/tendered their resignations, but spread over a five month period – starting with the well respected and popular creative content ecosystem leader, Hasnul Hadi Samsudin who left in Oct 2020 and immediately joined Sony which opened a game development studio in Malaysia last year.
By the way, Hasnul was already poised to join Sony in 2015 when they were looking to set up a game development centre here but those plans were delayed.
The back story to the departures
Now, as to why the eight execs left, trying to piece together the back story from my conversations with 11 current and past MDEC senior executives, including board members, it is true that there is major unhappiness among most of the eight execs with Surina and Rais. But is that unhappiness warranted and fair? And, is there a widespread belief that their departures are a loss to MDEC?
Some believe the refresh at the senior leadership level is overdue with a former executive telling me that the consensus in a chat group of ex-MDEC senior executives was, “It was long overdue, this changing of the guard.” The ex-executive had stronger personal views. “Some of them have become too comfortable in the job, earning high salaries with wonderful perks but offering no strategic input.”
I personally feel this is a harsh indictment but then a former board member agreed as well. “Change is good and I agree with the assessment that the old hands have not moved the needle and are sitting comfortable, not earning their keep.” As an active ecosystem senior, this former board member based his opinion on his interactions with MDEC leadership since leaving the board years ago.
“Give them a chance,” he says, referring to Surina and Rais, adding, “as Chairman, Rais has a fudiciary duty to clean up and tighten the ship if there are corporate governance issues there.” The ecosystem has been wondering about why Rais has been harping on governance issues since Nov 2020, five months after he became chairman.
What I know is that these issues were first thrown up by a 2019 audit done by accounting firm EY Malaysia on a major project, the DFTZ (Digital Free Trade Zone) which then led to KPMG winning a tender to run a major audit last year, called for by Rais, that also threw up some corporate governance issues, including around grant management where it seems that division heads had the authority to reallocate the budget for grants that came under their division.
Rais was apparently very upset when he discovered this unusual authority. Even officers at the Ministry of Finance were apparently not aware of this leeway MDEC had. When asked to confirm this, Rais (pic, right) would only say, “I was brought in to help drive and accelerate Malaysia’s digital competitiveness. There is so much work to be done. Vietnam is even overtaking us. I just want to set the foundation right and strong for everyone to give 110% and see results.”
To be sure, the board has dealt with issues before, notably when it acted to shut down MDEC’s investments into tech companies. In the early years of its existence MDEC had invested close to US$100 million (RM400 million) into nine companies which almost all flopped. It stopped making investments into tech companies after 2004.
Of the eight executives who left (strictly speaking, two are still there, serving out their time) there are some who are painting their departure as acts of professional conscience because they don’t like the actions of Rais and Surina. However, at least one of the departed was looking for a job 18 months before leaving.
But what is for sure is that most of them were entering the last few months of their two year contracts. That is the usual tenure given to senior executives at MDEC.
The kingmaker departs
I will comment on the two names that have aroused the most reactions. “She’s more powerful than the CEO,” is how departed CFO Nor Faizah Othman has been described. Starting off as a finance manager at MDEC, she moved to Cyberview Sdn Bhd for a stint before returning to MDEC when Badlisham Ghazali became CEO in 2006, and was GM of finance before being made CFO in 2011.
Adding to her influence was the fact that Procurement, IT and HR reported to her as well, allowing her to filter what was brought up to the CEO. “She was kingmaker and everybody had to dance to her tune if they wanted the budgets for their projects approved fast,” says an executive who served during Badlisham’s time.
Not averse to adopting a name and shame leadership style, she was apparently making it difficult for KPMG to access information, even though she had been instructed by Rais to cooperate. This necessitated Rais putting his foot down and demanding her cooperation, says an executive familiar with the situation.
Nor Faizah has been known to scold staff who shared documents in past audits as well.
The general feeling of her departure among those I spoke to is, “good riddance”, “best action Rais has taken”, “long overdue” but with one exec also expressing, “she was a pillar at MDEC”.
Now there are mixed views about Wan Peng’s departure but only from MDEC folks, past and present. But that is just natural when someone has been a senior leader for over 15 years. The ecosystem views her very well as does an ex-board member. “She has my highest regard,” he says.
I did feel that Wan Peng had been there too long. It is hard to generate bold ideas and inject fresh drive when one has become part of the proverbial furniture of an organization. Known for her cautious nature, she once remarked to a CEO that she felt MDEC was biting off more than it could chew with one major project. Still, I felt, she served some value in terms of institutional memory and being a torch bearer of MDEC’s vision and mission. This was Surina’s challenge in how to best manage the relationship.
The relationship was not the best and Wan Peng has made it known to some that she felt hurt by how she was treated, claiming she was only told of the new Operations Council management structure announced on Nov 16, minutes before the town hall to announce it.
Face to face meetings were held with the MDEC leaders involved to update them on the new structure. No meeting was held with Wan Peng who apparently did not respond to messages. If this is true, it is disingenuous of Wan Peng to then claim she was not informed of the move.
Still, what’s clear about the formation of the Operations Council is that most of the senior team were not aware or involved in the thinking and formation of it. As the most experience MDEC leader, it is unlikely that Wan Peng did not know of the moves afoot and felt offended at being excluded.
My attempts to reach Wan Peng have not been successful.
I leave it to readers to decide if this was the right approach taken by Rais and Surina in coming up with the Operations Council.
Surina’s leadership challenge
To be sure, Surina, who came on board in Jan 2019, comes with the least leadership credentials of any MDEC CEO. That is without question. The two CEOs preceeding her, Badlisham Ghazali and Yasmin Mahmood, were senior tech industry leaders who also commanded respect among the politicians and ministers they had to engage with to move the country’s digital agenda, which calls for cross ministry collaboration to ensure maximum impact.
“They would walk in to see ministers and senior bureaucrats to get buy-in for policies or specific programmes MDEC was promoting and how it was important for the national agenda and you can see the level of respect and acceptance they received. Surina comes with none of this,” a former MDEC leader tells me. Harsh but true.
Not helping matters further, the leadership team was also comparing her against Yasmin.
Also true is that former Communications and Multimedia minister, Gobind Singh Deo picked her, not for her leadership nous, but because he wanted an infusion of bold and new ideas.
But Surina did not help her cause when she failed to act on a mandate given to her by the board in 2019 to revamp the leadership structure which was deemed top heavy and operating in silos. It is surprising that this bloat happened in the first place under Yasmin’s watch, a seasoned leader.
The consensus among current and ex MDEC executives familiar with the situation was that Surina did not want to rock the boat. “It was very frustrating for those of us who wanted to see this happen to wipe away the overlaps and inefficiencies and tiresome turf fights, especially from those leaders who have been around for a long time,” says one executive.
This seems to have been a critical point that has shaped staff opinion of her. If Surina thought this was going to help get the senior leadership team of 18 managers on her side, she was in for disappointment.
I am not sure how often this happened but details of senior leadership meetings began to be leaked out, much to her frustration. This boiled over in the early 2020 when she brought the issue of the leaks up in a town hall, expressing her displeasure.
Besides such niggling issues that undermined her authority, she was also kept out of the loop on certain procurement issues where it seems a fair amount of the reporting stopped at the CFO and COO level. This is something that has been going on for years though.
One thing Yasmin did do during her watch was to enlarge the procurement committee to eight people with some rotation among them, but the CFO, Nor Faizah Othman, was a constant on this committee, along with one other senior executive believed to be the departed head of HR, Suzana Nawardin.
So clearly, Surina’s time and energy was not just spent on driving Malaysia’s digital economy agenda, she also had to spend time and expend energy on dealing with a resistant management team whose confidence she had lost – or never won in the first place.
(executive) Chairman Rais?
Against this tumult, Rais’ appointment as chairman in June 2020 actually threw Surina a lifeline and an ally. Yes, I know that there is a near unanimous view that he is behaving like an executive chairman and making most of the big calls. But the fact is, Rais came in and spent the first four months patiently listening to everyone and anyone, especially all MDEC staff. He did not act like a know-it-all.
He has also read the EY audit on the DFTZ and now the KPMG audit as well and these have given him the sense of urgency to act firmly to put in place the right processes and systems to ensure every penny MDEC receives is used correctly to build Malaysia’s Digital Economy and that every minute spent by MDEC is channeled to constructively and dynamically to grow and expand Malaysia’s Digital Economy.
The first entrepreneur and non-civil servant to lead MDEC’s board, Rais is proving to be the most accessible and open Chairman yet. He recently met with a former senior MDEC executive who, concerned over the departures, wanted to know what was going on. Where it would have been too easy for Rais to ignore this person or deflect his queries, Rais met him for an hour, took some criticism but also shared what he was trying to do. In the end the executive walked away with the belief that Rais was trying to do the right thing. “I think he deserves a chance. Deserves our support. That is the message I will be sharing,” he tells me.
Rais is also the Chairman most steeped in technology, innovation and research and is data driven. Infact his personal Twitter tagline is “Truth, Integrity, Research”.
He is also a gifted writer and thinker, contributing mainly political and economical issues over the past six years to the media. His tech based writing increased after he joined MDEC in June 2020. But he has been writing about tech much earlier than that, infact contributing very thoughtful and direct articles around broadband and even green tech from as early as 2003 to the technology section of the weekly newspaper I used to be editor of.
My own relationship with Rais began a year earlier with my first article being on his attempts to build the first software (wasn’t called app yet) that can make data calls over the fledgling EDGE (2.5G) network. And yes, he proclaimed it then to be among the world’s earliest attempts. That’s what I mean by Rais being innovative and bold in leveraging on technology.
Through the almost two decades that I have known him, Rais has proven to be a straight shooter and firm in his belief in conducting himself with integrity and honesty.
And if after listening to all parties, he has come out in favour of giving Surina a second chance, of giving her a team she can call her own, then I feel both he and Surina should be given a chance to lead MDEC on.
But surely there are those who will find it easier to swallow the version that says, here is a strong chairman, happy to keep a weak CEO on so he can run the show his way. That here is a political appointee, and that surely cannot be good.
The only way to dispel this version of the story is for Rais and Surina to be even more transparent in what they do. Transparent with MDEC, transparent with the ecosystem. Keep everyone aligned and with their eyes on the prize of building Malaysia into a successful and strong digital economy.
One area where Rais needs to better communicate is around the Malaysia 5.0 vision that he first started writing about in early Aug last year. Because this vision was actually created by the research company Rais runs, Emir Research, there is confusion over it and some concern that Rais is using MDEC as a vehicle to promote a private sector vision and will ultimately profit from this.
This is a very damaging association to let fester and when I asked Rais about this he stressed, “Not true! Malaysia 5.0 is something I have been advocating based on Japanese Society 5.0 for sometime now. I have written and spoken so much on it. Emir Research and/or me have not, will not ever, financially benefit from it. It is a setting of a direction, a vision! Remember Malaysia 5.0 is a journey. Just like Japan’s Society 5.0.”
Despite his clarification, I feel there is more communications needed around Malaysia 5.0 and for the government to come out and clearly take a position on this and who will lead it. Communications and Multimedia Minister Saifuddin Abdullah did mention Malaysia 5.0 in his New Year speech but really, getting one sentence is a speech is nowhere near the clarity MDEC needs. Rais has work to do here and quick.
Surina too has work to do. A lot of work. She can consider herself very fortunate to have the backing of her chairman and she has to seize this opportunity with both hands and give 110% to the cause, because her chairman is giving 110% to the cause.
Now she has demonstrated leadership, resolve and boldness in bringing in global tech conference and exhibition, RISE, that will be hosted by Malaysia from 2022-24. Her determination and leadership to win the bidding for RISE has earned her plaudits from the industry as it was not a cheap sponsorship package and she could have played safe and walked away but she believes Malaysian tech entrepreneurs and the ecosystem will greatly benefit from the influx of global tech entrepreneurs and investors to meet and network with.
Before that though, there is a lot of work to be done to further grow the tech ecosystem.
One of the seminal thoughts of the late leadership expert Peter Drucker is the fact that leaders are people who get things done through others. In this vein, where Surina cannot, she needs to lean on Rais to help build stronger bridges with the various government stakeholders that MDEC needs for the country’s digital economy to grow and prosper.
She needs to also lean on the new team she is building and get everyone to work together, united in vision, ferocious in drive and unwavering in their belief and confidence that the new MDEC being formed as we speak will be the strongest, best version of MDEC yet. So let us all support her and the chairman and keep our eyes on the prize of a Malaysia that transitions into one of the leading digital economies in the world.