Leadership Vanguard Myanmar Discoveries - April 2016

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The Leadership Vanguard – Myanmar Discoveries

Highlights from the Leadership Vanguard Global Exchange held in Yangon, Myanmar 1-3 March 2016

Reinventing leadership. Reinventing growth.

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Highlights from the Leadership Vanguard Global Exchange held in Yangon, Myanmar 1-3 March 2016

Reinventing leadership. Reinventing growth.

Introduction 04

Snapshots from Myanmar 06

Day One 08

Swans and Elephants 12

Day Two 20

Field Trips 24

Day Three 30

Flywheel 38

Who's Who 40

Contents

Introduction The Leadership Vanguard Global Exchange Myanmar Discoveries

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The Leadership Vanguard goes to Myanmar —

On 1-3 March 2016, this year’s Leadership Vanguard participants (or ‘catalysts’) gathered in Yangon, Myanmar, hosted by our Vanguard partners at Woodside Energy.

The Leadership Vanguard was created by Xyntéo and a group of global business leaders to mobilise and accelerate future-fit leadership. Today, leaders must be capable of leading businesses and organisations through a rapidly changing competitive landscape. Meanwhile, they must also contribute to the transition to a new model for growth – growth that is capable of delivering value over generations rather than fiscal quarters, and to society overall, rather than shareholders alone. Inspired by CEOs such as Paul Polman (Unilever) and Ajay Banga (MasterCard), and instigated by Xyntéo and Remi Eriksen (DNV GL), the Leadership Vanguard partnership includes: DNV GL, Energias de Portugal (EDP), Ericsson, MasterCard, Singapore’s Economic Development Board, Unilever and Woodside.

Myanmar is currently undergoing a period of rapid social and economic

development. Sustained and inclusive growth that benefits society and

business without placing undue stress on the natural system is not a given.

Leadership will be a key differentiator. Long-term success in Myanmar,

and indeed around the world, will require a deeper bench of leaders

equipped with the knowledge and capabilities required to build

successful, future-fit organisations.

It was against this backdrop that we embarked upon our first global

Exchange of the year. Exchanges offer us an opportunity to meet

in person and to share ideas and experiences and to expose us to new

and diverse perspectives.

On the first day of the Myanmar Exchange we shared our reflections on

the Leadership Vanguard journey so far. We then spent our second day

together in the field, gaining insights into Myanmar’s current commercial

and developmental landscape. On the third and final day we took time

to look ahead to the possibilities on the horizon. During the Exchange

we also identified shifting trends and emerging challenges in a broader

context, beyond Myanmar’s borders.

01 Marco Schultz from Unilever, and Osvald Bjelland from Xyntéo

02 Participants at the Myanmar Global Vanguard Exchange

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Together we are building a tribe of people across industries, geographies and generations, around the common goal and commitment of developing future-fit growth.”

Osvald Bjelland

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Snapshots from Myanmar

The Leadership Vanguard Global Exchange Myanmar Discoveries

Snapshots from Myanmar —

“There has been a deep loss of trust in many institutions, and not just government. Marriage today is incredibly provisional, very different from the notion of til death do us part. Businesses have that same attitude, schools have that same attitude, private medicine has that attitude. There’s a deep loss of trust.”David Bodanis

“Without electricity nothing will move and there will be limited economic development in Myanmar! Four years ago there wasn’t enough electricity generation, and some of the gas turbines and generators were over 40 years old. Things are evolving here in that aspect, but the nation would have to spend about 1 billion dollars to catch up with demand on generation, transmission, and distribution system.”

Andrew Lee

“Thinking broadly about topics outside of our daily responsibility allows us to break through the tunnel vision we inevitably develop in our daily jobs. There is great value in that.”Ilya Riaby

01 Ernst Meyer from DNV GL

02 Phil Loader, Executive Vice President for Global Exploration at Woodside Energy and sponsor of the Myanmar Exchange, shares his thoughts on future-fit leadership

03 Veronica Lie from Xyntéo

04 Isabella Sway-Tin, co-owner of Rangoon Tea House

05 Catalysts arriving at the Belmond Governor’s Residence

06 James Bereford from Xyntéo, Jacob Fonteijne from DNV GL and Liv Astri Hovem from DNV GL

07 Cecilie Heuch from DNV GL

08 Htet Myet Oo from Rangoon Tea House

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We all filled in the arrival card when we entered Myanmar, including the field for ‘occupation’. What did you write there? Engineer? Consultant? The things is, the next generation will not have one identity; they will not have only one title. They will manage many professional identities.”Emanuele Sevà

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Day One The Leadership Vanguard Global Exchange Myanmar Discoveries

Day One Looking back – Myanmar’s history and the Leadership Vanguard journey so far —

The Myanmar Exchange opened at the beautiful Governor’s Residence, where we set objectives and expectations for the three days ahead. We also reflected on the Leadership Vanguard journey so far, as well as learned about Myanmar’s political and cultural landscape.

Rick Wheatley and Veronica Lie kicked off the Exchange by exploring

what we observe around the world today with regards to growth,

inequality, populism and the resulting impacts on society and business.

They challenged the catalysts to employ a timeless leadership capability;

to notice what others do not. This was very much inspired by George

Orwell, whose writings were at least partly inspired by his time in Burma,

who once said ‘to see what is in front of one’s nose needs a constant

struggle’. Remi Eriksen also gave a video introduction and expanded

on the leadership imperative by challenging the catalysts to connect

thoughts and actions. The catalysts then shared thoughts on the

Leadership Vanguard journey so far – how they’ve been opening

up to new ideas – as well as their initial reactions to Myanmar.

“At the Exchange in New York someone said ‘take your time, enjoy the confusion of the first months.’ It has been unusual for me to take a step back and just think about and discuss these topics.”Philip Sasse

“The Leadership Vanguard weekly Learning Group calls are actually the highlight of my week – they give me the opportunity to think and talk about the things I don’t get a chance to discuss in my workplace.”Faith Beaty

“This experience has been fantastic. The material shared is really mind expanding, taking me out of the work I do every day.”Krishnan Sundaram

01 Rick Wheatley from Xyntéo welcoming the

participants to the Governor’s Residence

02 Remi Eriksen, Chairman of the Leadership

Vanguard, and CEO of DNV GL, welcoming the catalysts by video

03 Alexandre Imperial from DNV GL

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This group is so diverse. You wouldn’t think we have much in common, but then you realise after a while that a lot of us are grappling with the same issues.”Daniel Monehin

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Day One The Leadership Vanguard Global Exchange Myanmar Discoveries

Thant Myint-U, adviser to the president of Myanmar and chairman of the Yangon Heritage Trust, presented a fascinating update on Myanmar’s current context.

Myanmar is literally missing a generation of leaders

The changes in Myanmar are not happening overnight

“The military took over in 1962; in 1964, they nationalised all schools and

banned the teaching of English. This country used to have some of the

best private schools anywhere in Asia, and one of the best universities,

the Rangoon University. So you have thousands of men and women who

are about 70 years old who speak English very well and who are very

well-educated. But after them, if you look at people in their late 40s, 50s,

early 60s, you fall off a cliff in terms of training and basic education.

The exact group of people that you need as the senior managers,

your middle managers, people who can speak English to the rest

of the world is tiny here.”

“It’s often seen as an almost miraculous, night and day shift from a

pure, isolated military dictatorship and pariah state to an almost fully

functioning, open, more democratic system…. In 1995, the country actually

agreed to the outlines of what is today’s constitution. But it took 15 years

for that constitution to be fully completed and adopted and implemented,

and in a way what you see here is not a transition to a full democracy, but

a transition to a semi-democratic, semi-civilian constitutional framework

that’s actually been in the works for a very long time. My point is that it’s

not a sudden transition, it’s actually a 15-20-year-long process.”

“How can a country like Myanmar open up to the outside world and avoid

feeling exploited or experiencing a nationalistic backlash?”

“Right now, no one is connecting the dots between stakeholders,

investors and development organisations.”

01 Thant Myint U addressing

the catalysts about the changes happening in

Myanmar

02 Jemma Campbell from

Unilever during the day one sessions

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Osvald Bjelland, CEO of Xyntéo, shared his thoughts on the incredible change that Myanmar is experiencing, and the important role that thoughtful leadership will play.

I never make predictions

David Bodanis, author and futurist, spoke about navigating, and communicating about, the future.

Be cautious about the future“Enrico Fermi, the Italian physicist, was a professor at Columbia University

in 1940. There the professors participated in a bet every week about what

was happening in the world. In 1940 and 1941 the world was changing very

quickly. Each week about 15 professors would place their bets for

US$1, and would write their predictions. Each week the person with the

closest prediction would win the money. Fermi won something like 14 out

of 15 weeks. It was incredible. People asked him, ‘Who do you know?

Do you know people in Washington? Do you have contacts in Europe?’

Fermi made the same prediction every single week: ‘nothing will change’.”

Four ways to guarantee failure“Instead of ending with four rules to guarantee success, I’m going to end

with four lessons to guarantee failure. If you follow these four simple

lessons, I can guarantee that everything will fail. The first rule: jump on

the latest trend. Whatever everybody else is doing, pile in. The second

rule: be linear and assume that whatever happened in the past is going

to continue in the future. The third rule: ignore the past and ignore the

on-going desires that human beings have. After all, they are customers and

they get in the way. The fourth rule: if you do think you have something

right and have come up with a fairly good insight, try to be vague when

you communicate it. If you can’t be vague, try to be much too detailed.

Go into rambling detail with footnotes and references to technical articles

that are really exciting to our inner geek.”

“The genius Danish physicist Niels Bohr once said that prediction is very

difficult, especially if it's about the future. Still, I feel quite comfortable

making one prediction about the future of Myanmar – it will be radically

different than its past.”

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03 Osvald Bjelland from Xyntéo

04 Author and futurist David Bodanis

05 Philip Sasse from Unilever during the day one sessions

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Swans and Elephants The Leadership Vanguard Global Exchange Myanmar Discoveries

Swans and Elephants

In the lead up to the Myanmar Exchange the catalysts conducted a horizon scanning exercise that looked beyond corporate analysis of future trends to find the more nascent weak signals that are not yet fully understood but are likely to have material impact on the future of society and business. The catalysts presented the 12 weak signals they identified, and discussed their potential real-world implications.

EMBRACING THE ‘INTERNET OF HUMANS’Society is increasingly reliant on sensors and devices that link to

the human body and mind in order to inform human decisions and

enhance lives. However, our ethical decision-making frameworks

and governance structures are unable to keep up with the rapid pace

of technological change.

THE EDUCATION SYSTEM IS UNDERGOING A TRANSFORMATIONThe first digital native generation has now completed its studies,

yet students are ill-prepared to tackle the challenges of a fast-paced,

technology driven working world. The education system must adapt

to properly equip people with the skills, resources and tools they

need to succeed.

BLACK JELLYFISH – POSITIVE FEEDBACK IS DISRUPTING THE NORMAL ORDER OF SYSTEMSPositive feedback loops in social, economic, environmental and

geopolitical systems can push normal events into a ‘post normal’ state,

leading to disruptions or collapses in one or more systems.

“The prospect of humans becoming fully-integrated with devices or bionically-enhanced by software or hardware is increasingly not science fiction. It’s science fact.”Shelagh Muir

“With machine transfers and all of the automation that’s underway, it’s people who can think creatively who will succeed. Those are going to be the people who surpass us.”Jemma Campbell

“In Syria, in Damascus alone, I think 3 million kids are without school as we speak. In an experiment by the Norwegian government, the gaming industry was invited to compete to create an educational system that can easily be deployed in refugee camps rather than in school buildings and shelters. This changes the way we think about all the infrastructure that we normally have in a school.”Ernst A Meyer

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01 Shelagh Muir from Unilever

02 Emanuele Sevà from DNV GL

03 Torgeir Sterri from DNV GL

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01 Terence Gan from EDB of Singapore and Jacob Fonteijne from DNV GL

02 João Pedro Martins de Carvalho from EDP

03 Daniel Kalms from Woodside

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MOVING TOWARDS A NET-ZERO GROWTH ECONOMYAs population increases and Earth’s natural resources are depleted,

it will be impossible to sustain current consumption levels without

transforming models of extraction, production and use. As a result,

we may be approaching a ‘net-zero growth economy’.

PUTTING AN END TO FOOD WASTE If greenhouse gas emissions from food waste and loss were

compared to country emissions they would rank as the third largest

emitter in the world. Key stakeholders and policy makers are

beginning to demonstrate action that will shift trends in food loss

and waste for the better.

CARBON EATING BUSINESS MODELS Currently, national climate action plans don’t limit global

emissions to the extent needed. Scientists and technologists are

investigating technologies to enhance carbon capture and storage

capabilities. New incentives are needed in order to

attract entrepreneurs to this effort.

“We value things when they become scarce. When there was a plentiful supply of oil or gas, being efficient was not a big deal. Similarly when there was so much food, it didn’t matter if you wasted 20%. But as your ability to support the population is shrinking, you realise that nine billion people could actually get by on what seven billion people have today.”Daniel Kalms

“Within some consumer product companies the retailers expect to buy produce that has nine months until its expiration date. But if you have a product in your inventory that’s eight months away from expiration they won't buy it. This means products are often wasted.”Terence Gan

“The net-zero growth economy is a transition to something which is very alien to us; it’s about dividing what we have based on what we need. In the Netherlands where I live, there are now community centres where people come together. People who are good at fixing things will fix your things, your clock or whatever it is, for free. They enjoy it. It requires quite a radical rethinking of what we’re doing.”Jacob Fonteijne


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COGNITIVE COMPUTING IS DISRUPTING INDUSTRIESCognitive information systems can discover patterns in huge data sets

and unlock meaningful insights from complex situations. When coupled

with human creativity and values, this has the potential to disrupt many

industries and disciplines, such as education, medical research, finance

and pharmaceutical development.

FORGING THE AGRICULTURAL REVOLUTION: ROBOTIC, INDOOR, PERI-URBAN AND HIGHLY PRODUCTIVEIn order to meet the nutritional needs of a growing, more affluent world

population, new technologies and farming techniques are emerging. The

new high-yield, low-resource farming techniques could offer meaningful

environmental and social benefits to urban populations around the world.

CRYPTOCURRENCIES AND BLOCKCHAINS ARE CHANGING MODERN SYSTEMSDespite the risks and uncertainties surrounding digital currencies, there

is a shift towards using cryptocurrencies such as Bitcoin. Blockchain

technology eliminates the need for trustees and intermediaries such as

states and banks, which could undermine the system of trust on which

modern finance is built.

“Would you sign a disclaimer against a computer system about to operate on you? Now, cognitive computing may be a great help to the doctor because it supplies all the material necessary to make a decision, but the decision still remains with the human. What happens when machines make the decision?”Ilya Riaby

“It’s impossible to forge a blockchain. You can’t alter it. That is a great advantage in our field – you can put information there, certificate for a vessel, certificate for a company, your education certificates, even your personal information. You can also use it to avoid corruption in certain industries.”Geir Fuglerud

“Last week they were able to actually implant knowledge into a human brain for the first time. ‘The Matrix’ was just 10 years ago, but it’s no longer science fiction.”Rick Wheatley


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Ralph Foong from EDB of Singapore, Julie Fallon from

Woodside and Geir Fuglerud from DNV GL

02 Ana Quelhas from EDP

03 Ilya Riaby from MasterCard

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Placid Jover from Unilever

02 Kim Slate from MasterCard

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SHIFTING FROM A DATA-RICH TO A DATA-RESPONSIBLE SOCIETYData, technology and the cloud are enabling the next generation

of growth. The proliferation and dispersal of personal information

precipitates the need for business and government to align on and

adopt ethical practices around creation, usage, storage, archiving

and deletion of data.

INDIVIDUALS ARE PURSUING SELF-SUSTAINING LIFESTYLESWith escalating geopolitical tensions and increasing natural disasters

around the world, countries are shifting toward building and sustaining

their own insular economies. At the same time, there is an emerging

movement toward defining self-sufficiency as an international

human right.

SUSTAINABILITY ROOTED ACTIVIST INVESTORS ARE CHANGING THE INVESTMENT LANDSCAPE Activist investors may have perfected mechanisms for forcing change

(eg, launching proxy campaigns), but now more sustainability oriented

investors and grassroots organisations are learning from

this approach and using similar tactics to drive organisations to

become sustainable.

“In the Southwest of Australia nearly 50% of people have gone solar. It makes no economic sense at the moment but it’s that drive for some sort of independence and self-governance. Do people consider the consequences of everyone having self-governance? Do we go backwards in the end?”Tom Ridsdill-Smith

“People have the opportunity to be enhanced through technology, but some people will actually opt out. They’ll say: ‘That is not appropriate. That is not for me.’ There’s the potential that sections of society will become more and more enhanced and other people will say: ‘I’m opting out. I’m going self-sufficient’.”David Salmon

“I think the benefits of going to a formal educational institution are not just about acquiring a skill. It’s about social integration. A lot of technology takes away social integration. Are we creating a socially inept society because so much is being done or triggered through technology that I don’t have to interact with any person or persons on a daily basis?”Jill Docherty


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Day Two The Leadership Vanguard Global Exchange Myanmar Discoveries

Day Two Looking Around – Experiencing Myanmar —

On day two, we set out to learn more about Myanmar and to gain insight into the opportunities and challenges in the country. The catalysts explored social and economic drivers in a country that is undergoing rapid transformation and were joined by business leaders with first-hand experience operating businesses in such environments:

Dan Clery

Country Manager, Myanmar, Woodside

Carolyn Nash

Programme Manager Yangon, Partnership for Change

Andrew Lee

Country Manager, Myanmar, General Electric

Sithu Moe Myint Country Manager, Myanmar, MPRL E&P

Thomas Voght-Eriksen

CFO, DNV GL

These experts shared their own lessons learned from navigating the

landscape in Myanmar, and discussed the role that businesses can

and should play in advancing their company mandate while supporting

a better future for the country and its people.

“We can’t force all of our national or international standards or ways of doing things onto the projects here in Myanmar. We have to customise our way of doing things.” Dan Clery

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There’s a balance, because we want to move fast, and so do the authorities. In Myanmar there’s so much to catch up on to realise the potential, but at the same time there’s a risk that the government will legislate too fast, because the system needs time to adjust and catch up.”Dan Clery

01 Catalyst Ilya Riaby walks through the market, taking in the sights

02 Faith Beaty from DNV GL, João Manuel Brito Martins from EDP, Ilya Riaby from MasterCard and Daniel Clery from Woodside during the day-two panel debate

03 Paul Fenwick and Jemma Campbell from Unilever

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We might not be able to just implement the business plans we have from other markets, such as China, where I have worked for years. But we will benefit from using our experience, our competency and skills as we enter the market here.”Thomas Voght-Eriksen

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“Myanmar is still very fresh for me, and for DNV GL. One month ago I was not even aware that we had a plan of entering the market here, and my experience with Myanmar is now 28 hours long. Maybe that can reflect how much is changing here.”Thomas Voght-Eriksen

“You might see a lot of areas that need work. Education. Infrastructure. Healthcare. Transport. And there are a lot of expectations. But if you look back over the last four to five years, we’ve come a long way. Only three years ago we used to get seven or eight blackouts per day!”

“The GE team that we have here in Myanmar are dedicated. They are eager to learn. There’s incredible initiative. Every week I have to give them something new, challenge them.”Andrew Lee

“As a latecomer, Myanmar has the opportunity to learn from the developments, case studies and experiences of other countries that have been on similar journeys. Learn from Vietnam. Learn from Thailand. Learn from Indonesia.”Sithu Moe Myint

“Things are changing at such an incredible pace here right now. It’s really important to keep up. Nobody will follow you if you don't understand where they are coming from.”Carolyn Nash

Day Two The Leadership Vanguard Global Exchange Myanmar Discoveries 04

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01 Thomas Vogth-Eriksen from DNV GL

02 Sithu Moe Myint from MPRL

03 Carolyn Nash from Partnership for Change

04 Cecilie Heuch from DNV GL reflecting on implementing the learnings from the Leadership Vanguard further into organisations

05 Andrew Lee from General Electric

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Field Trips The Leadership Vanguard Global Exchange Myanmar Discoveries

Field Trips

An important element in the Leadership Vanguard journey is to go into the field and experience new environments – seeing first-hand the intersection between societal need and commercial potential. In order to learn more about the challenges and opportunities that Myanmar faces, we embarked on three different field trips.

Dalla – local shops and factoriesDalla is one of Yangon’s townships. It lies on the southern bank of the Yangon River, directly across from the main city. It is no farther from Yangon than Brooklyn is from Manhattan, except the only way to get to Dalla is via ferry: there are no bridges connecting the two landmasses (yet). Yangon and Dalla have therefore evolved in relative isolation into two completely different worlds: one a bustling city with the early trappings of a major Asian metropolis; the other a leafy shantytown with ramshackle huts and children bathing outdoors.

The group stopped at a local Buddhist monastery that doubled as a

primary school. The monks there provide a monastic education to over

500 students, 100 of whom are ‘boarders’ – orphans that poured in after

Cyclone Nargis hit Myanmar’s coast in 2008. The chief monk shared

insight into the school and the student experience: notably, between

English lessons and basic maths courses they are taught ethics and

values. We were struck by the fact that the monastery was a robust,

self-sustaining community, constructing their own basic infrastructure and

relying mostly on private donations rather than funding from the state.

Dalla’s residents are resourceful. The area has virtually no municipal

services and unreliable drinking water. Garbage litters the street and stray

dogs keep the rodents in check. Within Dalla’s sprawl of 200,000 people,

one can find plenty local manufacturing, services, markets, and transport.

We visited a candle factory, unlike anything most had seen before.

It resembled an open-air stable, with a thatched roof and electricals

haphazardly dangling down cement walls. This family-run business had

just two employees, one of whom was the owner’s eight-year-old nephew,

who worked part-time. They currently supply the Dalla market (which is

mostly unelectrified) with candles for both household and religious use.

The factory manager shared that after 20 years their business was now

threatened by large-scale candle factories popping up in Yangon.

We spent time with a family running a spring-roll paper business that

supplies to restaurants in Yangon. There, under a makeshift roof attached

to a bamboo hut, the staff made dough from wheat flour, quick-baked it on

charcoal burners, and packaged the finished product. In efficient, habitual

motion they produced a package of 100 papers in about five minutes,

to be sold for US$2.

We also visited Chu Chu, a new shop selling products made of recycled

materials. Sponsored by a European Union-backed Solid Waste

Management project in Myanmar, the shop offers beautifully designed

products made of bicycle tubing, plastic carrier bags and juice cartons

that are largely plucked off the local grounds.

Over the course of the day, we were surrounded by fishing villages,

schools and kindergartens, and small retail outlets that were interwoven

with countless more peoples, lives, and stories. Our visit exposed us just

a small sample of these people, striving to make their living.

“The whole community is set up with fantastic unwritten rules. It’s based on the concept that they help each other. So if you are poor today, don’t worry; tomorrow you can be someone else and you’ll help others.”

“The administrator at the monastery [aged 36] was referring to himself as part of a lost generation. Education is his devotion and his mission in life.”

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01/02 From the field trip to Dalla township

03 The chielf monk at the Buddhist monastery

shares his story with the catalysts

04 Shelagh Muir from Unilever talking to local

school children

05 Fishing village in Dalla

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I’ve been to similar places before, such as the favelas in Brazil, and they are dangerous for outsiders. But here, the people welcomed us in, talked to us and greeted us as part of the community.”

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Hlaingthaya Township – industrial parkEarly in the morning, we set out for Hlaingthaya Township, the oldest and biggest industrial zone on the outskirts of Yangon. Here, about 600,000 people are employed, many of whom are recent migrants that have come for jobs or homes or have been displaced by natural disasters such as Cyclone Nargis. We first visited a shoe manufacturing site. The factory manager, originally from Taiwan, shared his experience about setting up garment production in countries around Southeast Asia, and spoke favourably about the prospects for growth in Myanmar.

He employs only young women, most around 21, who have recently

arrived in the city from rural villages. Workers are paid about US$3 a

day – a little more than the minimum wage. After training, turnover is

exceptionally high, at around 60%. The manager is figuring out what kind

of incentives he needs to offer to retain staff – sometimes it’s not the pay

but rather the novelty of a new factory or an opportunity to work with

friends that tempts staff to leave. One hurdle he’s faced is incentivising

the staff to return to work on time after visiting their families and villages

during the annual water festival. Last year he offered staff the chance

to win one of 20 smartphones. At the time phone ownership was 10%,

but now it’s 80%, so he plans on rethinking his strategy this year.

We then visited nearby bamboo homes that flank the sandy tracks leading

to the factories, where we met some young girls that were busy revising

for their English exam. While the girls could write a little English, they

couldn’t speak it very well.

At a nearby local tea house, we heard from the young owner about how

he runs the shop with the help of his family. His mother and sisters cook,

while indentured child labourers from local families wait on the tables.

While he earns less than his previous salaried job, he appreciates that

he doesn’t have to get up as early.

Lastly, we visited a very different kind of factory: a high-end furniture

workshop run by a German entrepreneur named Marcello. His main

customer, and financial backer, is one of Myanmar’s wealthiest

businessmen. Inside are great slabs of local timber from Myanmar’s

rainforests – teak of course, but also selectively logged, rarer timber

from the rain tree. There are very few pieces of furniture though –

Marcello is still waiting to receive the permits that allow him to produce it.

Though his permit inspection is imminent, his patience is clearly fraying.

“The manager said that they can automate a lot of the processes, but it just didn’t make sense because human labour is cheaper.”

“In the shoe factory, I did a few little calculations in my head and worked out very quickly the cost of direct labour into one pair of shoes, which probably sell for US$100 in the USA. It was about US$0.18, and that was quite shocking.”

“Education is sort of free, but at the same time it isn’t. Education is provided, but if this boy [in the tea shop] went to school, it will be considered a loss of his income for him and his family.”


01 Krishnan Sundaram from Unilever and David Salmon from DNV GL

02 Catalysts hearing about the daily life at the industrial park

03 David Salmon from DNV GL sharing his reflections from the Hlaingthaya visit

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myME mobile school and Morning Star TeahouseOn a typically humid Yangon morning, we arrived at the Morning Star Teahouse. In its central location next to the Yangon Zoo, the teahouse even boasted its own parking lot – a rarity in Yangon. Despite the heat and the early hour, the teahouse was already bustling with nearly 60 patrons. Here, locals gather regularly to connect with their friends and foster a strong community. With no tables available in the main part of the teahouse, we made our way upstairs while a band set up downstairs for their charity performance to support internally displaced people in Myanmar.

Over traditional tea, we were joined by Tim Aye-Hardy, the Founder

and CEO of the Myanmar Mobile Education Project (myME). The project

provides education via mobile classrooms to children who have been

compelled into indentured servitude at teashop restaurants. In some cases

the children, who are often from rural families, both live and work in the

teashops. Often the children join the teashops soon after primary school in

order to find work. In some cases they are there to pay off mounting family

debts due to a failing farming system.

Over the noise of the band, Tim and the teashop’s owner shared their

first-hand experiences and stories. Tim expressed that despite his

well-intentioned plans, learning to navigate the local systems work with

stakeholders to build the myME project had been a complex process.

He shared that the purpose of the myMY project is to teach, but also to

share hope for a brighter future while building self-confidence and crucial

job skills for his students. We relocated to continue our dialogue with Tim

in a myME mobile school bus, taking our seats at school desks just as

Tim’s students would.

Finally, we met with two young boys who had been serving the group tea

in the teahouse. The boys described their working lives and shared how

myMe’s lessons were impacting their plans for the future.

“The first thing that struck me was this extreme short-termism. The shop owners don’t see the value of education because at the moment there’s nowhere to use it.”

“There are 3.7 million kids between the ages of five and 16 in Myanmar today who are not in school, meaning hundreds of thousands of kids across the country are living in these shops, working there all day, with no education.”

“We met two boys; they both said they were 15. The law seems to be that you must be older than 14 to work there, so either they’re quite small 15-year-olds or they’re not 15-year-olds.”

“It’s a complex system. Where does the government fit in? The teachers? The parents? If you make interventions in one place, what happens at a different place?”


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01/03 Tim Aye-Hardy, founder of myME, leading a

night class at the Morning Star Teahouse

02 From a night class at myME

04 A former student leading the class at myME

through intensive spelling games

05 Kenneth Vareide from DNV GL

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Day Three The Leadership Vanguard Global Exchange Myanmar Discoveries

Day Three Looking Ahead – Introducing the Four Frontiers —

Our third day began at the River Gallery, a contemporary art gallery near Yangon’s historic Strand Hotel. In a large room surrounded by art created by former political prisoners, one catalyst from each of the frontier teams, supported by their Xyntéo team lead, presented short vignettes that set the scene for this year’s Vanguard frontiers.

The frontiers aim to characterise emerging conflicts and fundamental

flaws in our current growth model. The frontiers are by definition not

specific to any industry or sector, but are instead broad enough that we

can identify spaces which align with our shared strategic interests and

core competencies.. Here, at the intersection of real human problems

and partner organisations’ commercial capabilities and interests, the

Leadership Vanguard can begin to shape opportunities for systems

interventions.

The next stages of the Leadership Vanguard journey will explore and

characterise these frontiers, enabling the identification of key problems

to which systems interventions can be applied.

Scarcity/AbundanceFood, water, energy, materials: human beings need resources to survive – there is no simpler truth in the world. And yet, the reality is anything but simple. The resources we so heavily depend on all come from the Earth. But instead of carefully protecting the Earth’s systems, we’re putting increasing pressure on them, endangering the Earth’s ability to sustain our needs.

Meanwhile, we also tie up existing resources in a messy, dangerous web

of human power dynamics. The US food system is just one example –

it creates artificial scarcity where it shouldn’t exist (such as food deserts),

as well as the kind of abundance that doesn’t make us any better off

(such as fast food that fuels the obesity crisis).

What does this mean for business? Businesses, like individuals, have the

same dependent relationship on resources, but they use them in a take-

make-waste model, perpetuating scarcity. They also breed materialistic

desires, creating unwanted abundance. As Mahatma Gandhi warned:

“The Earth can provide for every man’s need, but not for every man’s greed”.

How can we avoid the zero-sum dynamics of a resource-constrained

world, while preserving the stability of our planet’s systems? Can business

steward resources efficiently, distribute them equitably, and innovate us

out of resource scarcity?

“Collaborations in this space are often hampered by the prisoner’s dilemma; one party won't move until the other does. It becomes a question of leadership. To have faith that collaboration won’t be the end of your company.”Tom Ridsdill-Smith

“This often ends up being a question of volume versus value. We are stuck in this old model that high volume means lower costs, but it also means more waste. There could be so much to gain by focusing on value instead.”Veronica Lie

“How far back from the problem do we have to step to observe the entire system, and see the root of the problem?”Terence Gan

“Another part of the problem, especially in Europe, is subsidies. Thousands of tons of butter is spilled because of overproduction due to subsidies. I’ve read similar stories of rice in China.”Geir Fuglerud

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Whether you are talking about scarcity or abundance, both are just such incredibly complex systems.”Jill Docherty

01 Catalysts answering the question 'How

many have immigrants or immigration in their immediate family?'

02 Mahima Sukhdev from Xyntéo and

Tom Ridsdill-Smith from Woodside presenting the frontier Scarcity/Abundance

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In 1989 I saw, in Berlin, a statue of Karl Marx, where someone had written in graffiti: ‘Better luck next time’. Communism failed, and now the old form of capitalism needs a solid reinvention. I think you can come up with the next ideas that can take us forward, to build a new social contract.”Osvald Bjelland

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0201 Karl Marx statue in Berlin

02 João Pedro Martins de Carvalho from EDP during the frontier discussions

03 Daniel Monehin from MasterCard

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Contract/DissolutionThe social contract is the agreement between the individual and society – it is the basis for humans living together and functioning in communities, countries and collectives. The French philosopher Jean-Jacques Rousseau described it like this:

“Each of us puts his person and all his power into the common, under the

supreme direction of the general will; and in a body we receive, each

member, as a part of the whole.”

Historically, this was a bilateral agreement, but through privatisation and

the emergence of corporations, over time it has become trilateral, and

today business plays a decisive role.

In a modern sense, the contract means we agree to work hard, pay our

taxes and follow the laws of the land – and in return we get security,

roads, utilities, educational and medical systems, food safety and a state

that makes sure everyone behaves according to the laws. Yet corruption

is widespread, jobs are disappearing, retirement funds are vanishing and

climate change is changing the world as we know it. How can we redesign

the social contract so that it benefits both individuals and society in the

long and the short-term?

“The myME project seems to be the perfect example of a systems intervention in this frontier, affecting several factors and problem points in one powerful initiative.”Kim Slate

“Germany is one of the places where they are managing to create an economy with room for broad wealth building and where the social contract seems to still be held up by all the parties.”Philip Sasse

“At MasterCard we have explored how our business can strengthen the social contract. It’s actually viewed as a success criteria! Financial inclusion creates a more powerful and solid contract.”Daniel Monehin

“It’s not just across geographies, but also across generations. The social contract that our parents signed up to is just not valid for us. Social security, pensions…. We can’t expect to benefit from the same contract.”Joao Martins de Carvalho

“The contract used to be between the state and the people and the church. And then the church lost power, and business took over. Unions used to be a powerful tool for the people to regain strength without need for revolution. But as unions are weak, who is representing the people.” Placid Jover


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Order/DisorderThe events of the last 24 months in the Middle East, South China Sea and Ukraine, suggest that the post-Cold War international order is changing. Tensions between great powers are increasingly driving the fortunes of global businesses. Whether or not executives are interested in geopolitics, they increasingly understand that their balance sheet may become a casualty of state-deployed economic weapons, and their physical assets may be pulverised by an unforeseen conflict.

The traditional response of multinational businesses to disorder and

instability has been to either get out or build mini ‘corporate states’ –

providing full services and even private armies to protect employees, key

assets and infrastructure. But is this the full story?

Businesses successfully employ formerly antagonistic groups within

society, demonstrating that if people can work together, they can live

together. Rebuilding industries in post-conflict but high growth regions,

and offering decent jobs can make a return to conflict a heavy

opportunity cost.

In this new, more volatile political climate, should businesses build

resilience, or isolate themselves? If they are to prepare for a new world

order, is it more important than ever that business demonstrates it is

invested in the greater good wherever it operates?

“Even if you choose to not get involved and invest, these conflicts and issues come to you. With technology now, cell phones and social media, people in Africa stay in touch and track their relatives as they move.”Theo James Anderson

“There are a few examples of investors going into those places, and helping create more peaceful conditions, but it is risky.” James Beresford

“Investing in a troubled area also means your motives will be questioned very thoroughly. Natural resources, cheap labour, why are you entering there?”Pedro Vinagre

“Disorder comes with fear. Fear comes when there is no longer a functioning social contract.”Ernst A Meyer


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01 Julie Fallon from Woodside during the frontier discussions

02 James Bereford from Xyntéo and Marco Schultz from Unilever presenting their frontier Order/Disorder

03 Liv Astri Hovem from DNV GL, Nadine Allen from Ericsson, Jill Docherty and Ilya Riaby from MasterCard and Tom Ridsdill-Smith from Woodside during the frontier discussions

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My family owned a sugar farm in South Africa, and a few Indian immigrants worked there. Once, when I was nine, my father showed me a letter that they had written to him – a simple letter of appreciation for the chance he had given them, how much it had improved their lives. It’s important to remember the positive aspects of immigration, but the responsibilities rests on the side who can help.”Jemma Campbell

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Jemma Campbell from Unilever sharing a gripping story of the

positive side of migration

02 Ilya Riaby from Mastercard

discussing the frontiers

03 Theo Anderson from Woodside

discussing the frontiers

04 Chris Snyder from Xyntéo and

Krishnan Sundaram from Unilever introducing the Movement/

Stasis frontier

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Movement/StasisThe drivers of migration seem often obvious and well-documented: resource scarcity, conflict and risk to personal welfare, political persecution and better prospects for work. However, the stories are often more nuanced. For example, refugees have started returning to Syria from Jordan, despite the ongoing conflict. Consider also that for many developing nations, labour exports are a vital source of production; indeed the global value of remittances is four times that of international aid. And efforts in one region to improve quality of life for would-be migrants can result in labour shortages elsewhere.

From these and other complicated stories of migration, one common

characteristic emerges: hope. People have always been on the move,

and it is hope they pursue. Studies show that perceived opportunity for

improvement is a stronger indicator than actual conditions in determining

whether a person will decide to migrate. In other words, we are more

likely to stay where we are, even if things are better there, if we at least

have hope that it will get better here. So what role should business play in

building hope and opportunity at all stages of the migratory experience?

“Business has certain power to shape immigration, but I have often noticed a big gap between where business wants to take immigration and where government will let it.” Mahima Sukhdev

“This is a topic where there often is so much immediate outcry and reaction, that policymakers actually have very little room for logical and pragmatic discussions and solutions” Veronica Lie

“Refugees are often painted as needy, poor... The Syrian refugees are actually doctors, engineers: enormous talent and resources.”Chris Snyder


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Flywheel The Leadership Vanguard Global Exchange Myanmar Discoveries

Flywheel: Exploring our core competencies —

The culmination of the year-long Leadership Vanguard journey is the identification of new interventions and models that can address the sorts of challenges presented by a country like Myanmar, or inherent within one of our global frontiers.

These interventions must harness the knowledge, networks and vision of

the catalysts and Leadership Vanguard partners. As a first step towards

that goal, we identified and mapped our partner companies to understand

the capabilities they can bring to bear. We think of this as the ‘flywheel’.

During our flywheel session, we started to identify two key sets of

competencies: first and second order. First order competencies are the

strongest competencies, skills and abilities of the partner companies.

We asked: “What do we do well?”, “What are we proud of doing well?”, and

“What do we value?” Next, we identified our second order skills, abilities

and strengths – the things that are not as obvious. We asked: “Why are we

good at that?” or “Why do we care about being good at that?”.

This process will help identify the ‘sweet spot’: the productive space at the

intersection of the new business ideas for systems interventions and the

capabilities of our partnering companies. This foundation will serve as a

jumping off point for the next stage of the Leadership Vanguard journey.

It has also illuminated the possibility of progressing ideas, partnerships

and models previously thought to be far from partners’ core business.

Cecilie Heuch, Chief HR Officer of DNV GL, shared her own insights on

this subject based on her experience supporting catalysts from DNV GL

through the Leadership Vanguard in 2015. As a result of the experience

and knowledge gained, DNV GL catalysts from 2015 are sharing and

developing new expertise within their own organisations.

“Flywheels can break if they go too fast. A reformist group within a large organization can be the flywheel of future momentum, but they have to watch out. They have to act cohesively. They can’t fight and tear apart.”David Bodanis

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The Leadership Vanguard holds great value for all the companies here and can feed into our other leadership programmes. But it depends on how we, as partner companies, are able to link with each other to tap into the programme. So, how we integrate the learning back into our companies is a key issue, and part of the purpose of the flywheel process.”Cecilie Heuch

01 The Unilever catalysts during the Flywheel session.

02 Mafalda Vasconcelos from EDP

03 David Bodanis reflecting on the power of the flywheel.

03 Kjersti Tvedt, Elina Jiang and Anette Solvang Bergersen from Xyntéo and local contact Ah Di03

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Who's Who The Leadership Vanguard Global Exchange Myanmar Discoveries

Who’s Who An outstanding group of leaders and change-makers joined us in Myanmar —

● NADINE ALLEN Head of CU Industry & Society, Region Western Central EU Ericsson

● THEO JAMES ANDERSON General Manager Organisational Development Woodside Energy

MIN THU AUNG (AH DI) On the ground support, Accelerate

● TIM AYE-HARDY myME

● FAITH L BEATY Director, Marketing & Communication North America DNV GL Business Assurance

● JAMES BERESFORD Theme Lead Xyntéo

● OSVALD BJELLAND Chairman and CEO Xyntéo

● DAVID BODANIS Author

VICKY BOWMAN Director Myanmar Centre for Responsible Business

● JOÃO MANUEL BRITO MARTINS Strategy and Innovation Director EDP Brazil

● JEMMA CAMPBELL Vice President FinanceUnilever

BRIGHID CHUA Business director, NatRay

DANIEL CLERYCountry Manager MyanmarWoodside Energy

● JILL DOCHERTY Senior Vice President and General Manager HSBC, MasterCard

PHILLIP DURRANTPhotographer

● JULIE FALLON Senior Vice PresidentEngineering, Woodside Energy

● PAUL FENWICK Vice President M&AUnilever

● JACOB FONTEIJNE Executive Vice President, Power TIC DNV GL

● RALPH FOONGDirector Singapore Economic Development Board

● GEIR FUGLERUD Area Manager, Middle East DNV GL Maritime

● TERENCE GAN President, Europe Operations Singapore Economic Development Board

● COREY GLICK Programme Manager Xyntéo

RICHARD HARRISON County Director, Myanmar Pact

CECILIE B HEUCH Group Chief HR Officer DNV GL

● JØRGEN HOLST Theme Lead Xyntéo

● LIV ASTRI HOVEM Vice President and Regional Manager, Continental Europe, North and East AfricaDNV GL Oil & Gas

● WAI HTOO KYAW CEO J Myanmar Co

● ALEXANDRE IMPERIAL Regional Manager, South America DNV GL Oil & Gas

● ELINA JIANG Project Coordinator Xyntéo

● PLACID JOVER Vice President HR Organisation, Performance & Analytics Unilever

● DANIEL STUART KALMS Senior Vice President Australia Business UnitWoodside Energy

ANDREW LEEChief Country Representative, MyanmarGE Global

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● VERONICA LIE Executive Vice President Communications and Strategy Xyntéo

PHILIP R LOADER Executive Vice President, Global Exploration Woodside Energy

● JOÃO PEDRO MARTINS DE CARVALHO Director of Planning, Control and Business Development EDP – Energias de Portugal

● ERNST A MEYER Executive Vice President, Offshore Class DNV GL

● DANIEL MONEHIN Division President, Sub Sahara Africa MasterCard

● SHELAGH MUIR Vice President R&D Oral Care Unilever

HTET MYET OO Co-Owner, Rangoon Tea House SITHU MYINT Deputy Country Manager MPRL E&P Pte

THANT MYINT-U Founder and Chairman The Yangon Heritage Trust

CAROLYN NASH Program Manager Yangon Partnership for Change

● ANA QUELHAS Senior Project Manager, Energy Planning EDP – Energias de Portugal

● ILYA RIABY General Manager Russia, Kasakhstan, Belarus and Armenia MasterCard

● TOM RIDSDILL-SMITH Vice President Science Woodside Energy

● DAVID SALMON Director Strategy and Markets N&W Europe DNV GL Business Assurance

● PHILIP SASSE Vice President Finance, South Africa Unilever

● EVAN SCANDLING Managing Director, Myanmar Sunlabob Renewable Energy

● MARCO SCHULTZ Vice President Foods Unilever

● EMANUELE SEVÀKey Customer Management Head DNV GL Business Assurance

● KIMBERLEY SLATEGroup Head, Emerging Payments Technology Portfolio Management MasterCard

● CHRIS SNYDER Theme Lead Xyntéo

● ANETTE C SOLVANG BERGERSEN Project Coordinator Xyntéo

● TORGEIR STERRIVice President, Regional Manager and Area Chair Greater China DNV GL Maritime

● MAHIMA SUKHDEV Theme Lead Xyntéo

● KRISHNAN SUNDARAM Vice President, Marketing Operations South Asia Unilever

ISABELLA SWAY-TIN Co-Owner, Rangoon Tea House

● GALEN TOWNSONProgramme Manager, Woodside VanguardXyntéo

● NGWE TUN Founder, Genius Coffee

● KJERSTI TVEDT Assistant Programme ManagerXyntéo

● KENNETH VAREIDE Divisional Director for Oil & Gas Technology and Services & Governance, DNV GL Oil & Gas

● MAFALDA VASCONCELOSHead of Planning and Control DepartmentEDP – Energias de Portugal

● PEDRO VINAGRE Customer Service Director EDP – Energias de Portugal

THOMAS VOGTH-ERIKSEN Chief Financial OfficerDNV GL

● RICK WHEATLEY Director of the Leadership VanguardHead of Leadership and Innovation Xyntéo

PHYU PHYU WIN OO Operations Manager, Woodside Myanmar

HILLARY YEE Co-Founder, Mystylo

CATALYST

BEACON

PATHFINDER

XYNTÉO TEAM

Meanwhile, follow the activity on Twitter @Xynteo #TheLeadershipVanguard #ExchangeMyanmar

www.xynteo.com

The next stop for the Leadership Vanguard is the London Exchange on 15-16 June, 2016. In the meantime, we are channelling the inspiration and momentum gained in Myanmar into our regular programme engagements. In the lead up to the London Exchange the catalysts will continue to engage with their frontier groups in order to unpack and develop new ideas and lessons learned. They will identify key problems in the world around them and explore opportunities for systems interventions.

We look forward to seeing you in London!

http://www.twitter.com/xynteo

Documents

Leadership Vanguard Myanmar Discoveries - April 2016