Investing in real estate is commonly said to be about location and timing. But for CapitaLand chief executive Liew Mun Leong the heart of his firm’s approach to management is simple and embodied in its corporate tagline: “building people”.
“We think that it’s the people who decide the location, it’s the people who decide the timing,” he told a seminar on Asian Business held at NUS.
“And I say that if we make the people decision right, then both will be right. If our people’s decision is wrong, then you find it wrong location, wrong timing.”
Hiring the right people is key to ensuring that Southeast Asia’s largest developer by market value makes good business decisions, says Liew, who oversees the Singapore-based conglomerate’s management of about US$47.5bn in assets.
The company’s focus on building people, he says, is aimed at nurturing and retaining the best talent, helping CapitaLand weather the crises of the past decade and put it in a strong position to face any future challenges.
Asia has a problem, he says: it doesn’t train enough CEOs and high level leaders. He believes that as Asian firms look to go global, having global leaders is imperative.
To build that top level talent internally, CapitaLand has focused on building an open corporate culture. With 12,000 staff spread across 20 countries in three continents Liew says the company sees a flat organisational structure as essential.
“We try to shorten the power distance to promote mobility and interaction”, he says.
For example, Liew says he makes a point every morning of scanning his inbox for emails from staffers he did not yet know, and giving those priority attention.
I don’t need consensus, but I will consult you – I’ll let you participate and then we will make a decision
Liew Mun Leong on management process
“That is the first email I’ll open because it is somebody who wants to tell me something.”
He also believes in empowering his subordinates and giving them operational and financial autonomy. Heads of CapitaLand business units for example are free to approve investments of up to S$300m (US$238m).
“What we’re saying is we give you all the power to operate, but we standardise certain things, especially performance and some policies,” said Liew.
“As long as you remain within the policy framework, you can do what you want. We decentralise the operation to you.”
One thing Liew says he does not tolerate, however: office politics. Office seagulls, peacocks and other feathered creatures of the corporate world are not welcome.
“I used to tell my colleagues, ‘please don’t play politics, because if you play politics, you’re playing in front of the master’,” he says.
Liew also takes a firm line on management process. There is, he believes, “no democracy in management.” Good management he says should be consultative and participative, but that is different from consensus.
His philosophy is this: “I don’t need consensus, but I will consult you – I’ll let you participate and then we will make a decision.”
Fundamental to that, he says, when a decision is made everyone must support it.
“If you throw a stone behind it, then we will make sure that you won’t be around to throw stones.”
Looking to the company’s external relations, with the China market coming to dominate CapitaLand’s overseas interests, Liew rejects suggestions that doing business in China requires being prepared to resort to bribery and other forms of corruption.
In fact Liew insists that all of CapitaLand’s dealings everywhere are clean and transparent, and are seen to be so.
“My advice is collaborate with them, work with them but don’t sleep with them,” he says.
Liew believes it’s not good enough simply to be honest, you must also be seen to be honest. To that end all CapitaLand staff must sign an anti-corruption pledge every year.
“We can go to a city, the first thing we tell the mayor, governor or whatever, we say, ‘look, we can help you build your city. We can help you build a school. We can help you put a feather in your cap. But no Renminbi in your hands. If you want Renminbi in your hands, then we are not coming.”
Liew says many people he meets are sceptical that such a stand is possible for doing business in China, but he is adamant that it is the only way for CapitaLand to operate.
Indeed China is now CapitaLand’s largest market, with projects in development for residential properties, offices and shopping malls across the country, served by a workforce of about 6,000 CapitaLand staff.
Looking ahead, Liew says he expects to see CapitaLand’s China business grow to around 45 per cent of the company’s total assets in three to five years.
A major part of the firm’s current expansion effort is focused on the southwestern city of Chongqing – a city Liew believes is well positioned to become China’s next major business centre after Shanghai.
As part of that growth, he pointed to CapitaLand’s recently unveiled US$3.4bn investment in developing a landmark mixed-use property project on prime land in the centre of Chongqing.
Chaotianmen project, with a design similar in appearance to Singapore’s landmark Marina Bay Sands resort (although perhaps even more ambitious), incorporates shopping malls, residential, office and hotel accommodation, as well as high rise sky parks.The high prestige
The huge project, targeted for completion in late 2017, is seen as a sign of CapitaLand’s confidence in the long-term growth of the Chinese property market, amid nervousness in some areas over a possible downturn.
The bold design, Liew says, reflected China’s growing status and ambition, throwing off its conservative image of the past and opening up to new ideas.
“They are actually a very open society now,” he says, rejecting views that China remains a closed and introverted society.
In fact Liew says he receives many more emails on operational questions from mainland Chinese staff than others in the company.
He sees that as a promising sign that mainland Chinese leaders will soon be able to take on a greater role in the management of CapitaLand’s growth within China itself.
At present much of the company’s operations in China and elsewhere in Asia are led and managed by Singaporeans deployed from headquarters.
In the long-term however, Liew says he wants to see more local talent take over management at the country level as the firm builds a larger pool of leadership talent across its businesses.
Much of Liew’s philosophy on management and personnel development stems from a series of Sunday emails sent every week to all 12,000 CapitaLand staff.
A habit he began almost on whim 1998 has since become an ingrained part of CapitaLand’s coporate culture, with staff opening their mailboxes on Monday morning to find the CEO’s latest thoughts and insights.
It’s a practice Liew takes pride and time in following, spending several hours after lunch every Sunday afternoon to craft his message.
His emails touch on subjects ranging from ethics and values to business management, as well as drawing on lessons from life experiences he believes are worthy of sharing.
“At one time I was writing quite a fair bit on being filial to your parents for example,” Liew says. “So various things that would become lessons to people at different times and for different purposes.”
His series of emails has so far been compiled and published in two volumes helping to spread the CapitaLand philosophy well beyond the company itself.
Indeed, he says, several Chinese companies had bought the books as gifts for their clients.