The Mega Infrastructure Project – an Elephant Analogy, with Ants

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The elephant in the room: How sustainable is GDP growth?

To prevent corruption and get the most cost-effective deal, don’t let the elephant dictate and always be aware that what the ants (the people) have isn’t much, says our special correspondent.

When an elephant walks through a jungle what chance have the ants in its path? What chance have the trees that it eats or the grasses it tramples in passing?

When the power of capital and pursuit of profit encounter the hopes and aspirations of the common man and woman, their less powerful children, and the practically powerless flora and fauna that share their land, what chance do they have?

The purpose of government is to protect the ants. To level the playing field and ensure fair play. Government, at every level, is there to protect the rights of those it serves, enhance the quality of life for all, and maintain and improve our environment – for, without it, nothing happily survives.

Hong Kong’s Independent Commission Against Corruption (ICAC) was established in the early 1970s. A less well-known fact is that its formation coincided with the completion of a top-level government review by McKinsey consultants.

The purpose of the McKinsey review was to introduce practices that would make measuring government efficiency more effective. Everyone wanted to know whether government at every level was performing well. At the time, few were convinced that it was.

There was also the question of corruption.

If an elephant is left to its own devices, it will go where it pleases. Because of its size, little it encounters will obstruct it. If a large corporation or financial consortium is left to its own devices, it will do the same.

An elephant will invest its energies in satisfying its basic needs: to eat, to mate, to care for its young. To achieve this, it will travel from one basic need to the other, by the most direct route – so look out, ants!

Large engineering and development consortiums or corporations – such as the ones involved with the controversial East Coast Rail Line and the currently much-in-the-news Penang tunnel – are no different from elephants in this regard. Except their strength is not muscle and bulk.

Their strength is money. And their needs are not eating, mating, or caring for young. Their reason for being, is profit. And the larger the profit the better – so look out, ants!

This raises a reasonable question: Is the need for the Mega Infrastructure Project necessarily questionable, merely because it appears to be championed by a business consortium? Answer: of course not. Why? Because it could, despite that, still be in the best interest of the ants.

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How do you establish if the consortium is acting for the ants or for the elephant, (meaning itself)? Answer, by posing a few simple questions:

Question 1: Is the Mega Infrastructure Project a component part of a larger plan?

Question 2: If it is part of a larger plan, was the exercise that produced that plan based on a specific and logical need? Did it respect the wishes of the public? Was it taking into account the most effective options available at the time and their cost – both environmental and financial? Or was it produced by the elephant? Meaning the consortium itself?

Question 3:
If the plan was produced not by the consortium, but by an exercise based on dialogue, research, and analysis, by the representative ants – meaning the government – for the everyday ants – meaning you and me, our dependents, and the environment in which we live – then is there evidence of the steps taken in this exercise?

If these steps have been taken, but have not been made available for public scrutiny, reasonable questions then arise: So do they exist? Or were they inconclusive? Either possibility throws doubt on the validity of the claim that the plan was derived with the paramount interest of the ants in mind.

Moving overseas: What are the steps that would likely have been taken when Hong Kong was on its best post-ICAC formation and McKinsey-influenced behaviour in order for us, the ants, to feel satisfied that our interests were paramount in drawing up the plan?

First step: A detailed task analysis

The first step would have been the creation, by the government team, with or without assistance (the Hong Kong government had McKinsey) of a detailed task analysis which would illustrate precisely why the Mega Infrastructure Project is needed, through a clear and logical chain, flowing sharply and logically from the basic function of government.

If McKinsey taught the Hong Kong government anything, it was to understand the importance of, and difference between, an objective and the activity one carries out to realise that objective.

For an elephant, the objective might be to get from eating to the chance of mating. The activity it would likely consider most readily would be “to walk” or perhaps, depending on certain criteria, “to run”. Any business consortium representative, however, would have a far greater choice of available activities, any one of which would realise the same objective.

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He could walk, for example, like the elephant. He could use his smart-phone and call for the corporate Mercedes. He could go by train or even fly, if the distance warranted it. McKinsey was all about being clear in your mind what it was you were trying to achieve, before you even thought about the means by which you would achieve it.

Take transportation … What are the relevant questions one might ask to discern the objective desired and the activity best to achieve it?

First off, where does transportation fit into the overall objective of a better life for all?

Then, what are you trying to transport? For example, vehicles or people or goods?
Why are you seeking to transport them, is a third question you might ask. For example, to get people from homes, to where the jobs are?

If that is the objective, a less disruptive, expensive, and more agreeable solution – meaning activity – might be to arrange matters so that places of work are conveniently situated close to appropriate accommodation for workers. Proximity of place of work to airport has corporate attraction; proximity of place of work to homes has commuting ramifications … which do you prioritise?

The last thing you want at this stage is the elephant dictating. If you leave matters to elephants, they will live where they want, eat where they want, and mate when they feel like it.

Second step: Deciding which particular option is preferable

The second step we should expect to see, with or without the assistance of independent expert consultants, is the exercise that decides a particular activity is preferable to another. For example, don’t walk, take the Merc. Or, if you’re an ant in the path of an approaching elephant, do you run or duck?

At this stage, from a corruption prevention standpoint, the expert consultants must not be linked in any way to those who might eventually bid for the job of enabling the activities required, to satisfy the objectives you’ve defined.

It should be mentioned here that eliminating corruption opportunities from the process is simple efficiency: it ensures that only relevant matters are considered and therefore, the most beneficial conclusions reached.

Third step: Convert the agreed plan into component parts

The third step one would expect is to convert the agreed plan, reached with or without the aid of independent consultants, into its component parts. This provides a list of separate activities.

A key question is, which of these activities can be handled within the government’s own resources, and which must be put out to tender.

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There were two corruption prevention points discovered swiftly by the ICAC/Police Department regarding this step.

The first is this: if the work can be done within government, always do it there. As soon as matters go to outside contractors, corruption opportunities inevitably arise. And where there are corruption opportunities, costs always rise. (They always rise because any corrupt payment will be factored into the overall cost. And the overall cost will always be greater than needed, because the greater the total, the greater the corrupt payment to the official, and the greater the profit to the contractor. So look out, ants!)

A second point revolves around decision-making. In order to dramatically reduce corruption opportunities, it is always advisable to involve elected individuals or outside parties in any decision-making process related to government expenditure. The worst thing one can do is limit decisions to individuals who fill a certain government post or are nominated. As was quickly established in Hong Kong, as soon as positions themselves become corruption opportunities, then, like a cancer, the corruption spreads. Those who have it in their power to nominate people to especially attractive posts are suddenly expecting their “reward” at having done so. Cut out the cause, and much of the web of corruption disappears.

Open tenders and transparency are the final points on process. An open tender must be defined in terms sufficiently restrictive, limited and detailed to ensure that every tender response will satisfy the exact same activity. Apples with apples, in other words. If it is too general, decisions become subjective, comparisons impossible, corruption opportunities proliferate, and the end result is no longer in the interests of the ants.

If the steps outlined above cannot be shown to have been taken, then it is likely, experience in Hong Kong suggests, that the elephant has been involved, thus ensuring its objectives are met – so look out, ants.

It isn’t easy. But experience elsewhere has shown that, if the will is there, it can be done.

Two things Hong Kong quickly learned: don’t let the elephant dictate; and always be aware that what the people have on their side isn’t much … a bunch of ant-like common you’s and me’s, a scattering of hills, some thickets of trees, a bunch of birds, some shoreline, and a crab! And the children, of course. Don’t forget them. Playing on the beach.

For they are the future. Not us.

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PolitiScheiss+(a.k.a.+IT.Scheiss)
PolitiScheiss+(a.k.a.+IT.Scheiss)
5 Mar 2018 1.11am

Dr. Kenichi Ohmae, then a consultant with McKinsey & Co, advised a group of 30, including then prime minister Dr. Mahathir, that Malaysia needed an IT and a new multimedia industry, without which Malaysia cannot achieve the goals of Vision 2020.
https://www.thestar.com.my/business/business-news/2003/03/22/the-man-synonymous-with-it-in-malaysia/

Malaysia engages McKinsey as consultant to help draft blueprint for the Multimedia Super Corridor, dated 1996. McKinsey re-engaged to study why MSC hasn’t attracted much interest from global tech companies, produces report dated 5 Feb 2001, proposes Malaysia consult “elephants”
https://www.wsj.com/articles/SB985546632747414198

So can KcKinsey really help Malaysia fight corruption?