Governing Magazine/June 1996

TECHNOLOGY COLUMN

LESSONS FROM AN `INTELLIGENT ISLAND'

By Jerry Mechling

Jerry Mechling is director of the Program on Strategic Computing and
Telecom-munications in the Public Sector at Harvard University's
Kennedy School of Government. To reach him, call 617-495-3036 or send
e-mail to jerrym@ksgrsch.harvard.edu.

Over the past 20 years, the island of Singapore, a self-governing
city-state about the size of Philadelphia, has aggressively used
information technology to develop its economy. Its successes hold
valuable lessons for American governments.
 In the 1970s, Singapore created a National Computer Board and
launched infrastructure projects in telecommunications, computer
education and computing within government. Within a decade, the number
of Singaporeans with computer science degrees grew from 400 to 8,000.
 In 1986, Singapore launched TradeNet, a project to introduce
electronic data interchange for trade documentation. Over the course
of three years, Singapore officials first gained broad agreement to
simplify trade and then began standardizing the documents used for
trade by public and private organizations alike.
 Since 1989, TradeNet has reduced the processing time for trade
documents from a typical two days to 10 minutes; the number of forms
required for a ship to clear the harbor has been cut from 20 to one.
Freight forwarders report savings of 25 percent to 35 percent in
documentation costs. Ships clear the harbor in half the time required
in other ports.
 Using the infrastructure and skills built through TradeNet, Singapore
has since gone on to launch other electronic commerce initiatives,
including MediNet, LawNet, SchoolNet, EconNet, BizNet, RealNet,
StarNet and ApparelNet. Singapore's vision is to become "the
Intelligent Island," using information technology to position it as
the headquarters city for corporations doing business in Southeast
Asia.
 The first reaction of many Americans to the Singapore story is: "But
we're not like them, and we couldn't do that."
 It's an understandable reaction. They're small, we're not. They have
a largely Confucian culture, with more respect for authority than we
have. And their government often looks more like an efficient
dictatorship than a Western-style democracy.
 Nevertheless, given the importance of electronic commerce to the job
base and communities of America, we can't afford to let differences in
politics and culture blind us to important lessons from Singapore's
experience:
 Global electronic commerce can pay off. Since 1965, Singapore has
increased its per capita income 846 percent, with strong growth
continuing even as it shifts to higher value-added jobs and
lifestyles. While there are many reasons for its success, Singapore is
clearly Exhibit A in favor of society-wide reengineering based on
electronic commerce.
 Government can play a needed role in creating information
infrastructure. The role for government is neither the go-it-alone
leader/dictator nor the stumblebum whose best hope is to avoid mucking
up the creativity of an unfettered private sector. Given the large
economies of scale and scope of computer networks, heavily networked
economies require infrastructure whose cost and risks must be spread
over the larger economy, not merely borne by the early adopters. This
often necessitates government action, since government may be the only
institution large enough to absorb such risks, and can also be a
neutral arbiter to encourage cooperation among otherwise fractious
competitors. The Hong Kong and New York harbors--without the
governmental leadership provided by Singapore--have not come close to
matching the efficiencies of TradeNet.
 Implementation often needs a "slow trigger and fast bullet." The
Singapore story illustrates the great care officials there took in
building a cascading series of commitments, first to the importance of
electronic commerce, then to the specific investments that supported
it, such as TradeNet. Led by the government, they formed broad cross-
sectoral study teams to gain substantive knowledge and also to signal
the growing strength of their commitment to change. Then, once they
moved from planning to implementation, they proceeded as quickly as
possible (some might say ruthlessly). Careful preparation, followed by
committed and forceful implementation, produced better success than we
typically achieve.
 Listen carefully to outsiders. In building TradeNet and other
infrastructure, Singapore listened to outsiders. In the global
electronic economy, relevant lessons are surfacing all over. While
other nationalities don't seem to find it politically risky to travel
and listen to outsiders--in just one week in April, for example, our
program at Harvard hosted one traveling group of high-level government
officials from Norway and a second group from the Netherlands--it's a
risk and barrier for Americans. It's a risk we need to accept and to
reduce.

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