Research Paper Series 2002

RPS #2002-001 (CET)
Devendra Pal Singh
“Firm And Product Composition, And Opportunities For New Firm Formation”

In this paper, I aim to answer the question “When is it easiest for a new firm to enter an
industry, so as to exploit its technology?” I propose a framework for understanding the
opportunities for new firm formation and demonstrate its value in the context of dynamic
industry changes. This framework demonstrates that in firm composition and product
composition create opportunities for new firm entry. We term these opportunities “easy”
entry points. These easy entry points may result in significant new firm formation, which in
turn can significantly alter industry structure.

RPS #2002-002 (MKTG)
Jochen Wirtz & Robert Johnston
“Singapore Airlines: What It Takes To Sustain Service Excellence – A Senior
Management Perspective”

Singapore Airlines (SIA) is internationally recognised as one of the world’s leading carriers.
This article reports a series of in-depth interviews with SIA’s senior management on their
views on what made SIA a service champion, and what it will take to maintain its lead in the
industry. Excerpts from there interviews were broadly organised into the four sections: (1)
SIA’s Perspective of Service Excellence, (2) Understanding Customers and Anticipating their
Needs, (3) Training and Motivating the Front Line, and (4) Managing with an Eye for Detail
and Profits.

RPS #2002-003 (BP)
Linda Low
“Crisis And Supply Shock Management In A Small Open City State”

Singapore is a small open economy (SOE) dominated by state-owned enterprise (SOE). This
double SOE-SOE feature or political economy of a city state is like two sides of a coin; the
government wields both economic and political control which created and distributed wealth
through a set of chain linked macroeconomic stabilisation policies. A review of crisis
management since the 1960s poses a number of hypotheses and policy issues revolving
around the efficacy of the SOE-SOE strategy in the age of globalisation, new technologies
and knowledge-based economy (KBE). The contagious Asian crisis was a turning point but
the synchronised global downturn since September 11 2001 was a defining watershed for
state intervention. What suits Singapore is probably not as unique. The development-
oriented SOE-SOE with an upright government can practise better governance especially in
being more transparent as future crises will require greater understanding and cooperation
from a more democratised nation. Social trust, social capital and political stability can be
reinforced, not threatened if governance is less topdown and more inclusive. In reinventing
its SOE-SOE, Singapore can grasp the opportunity to play an intermediary and facilitating
role for the region in the globalised context and at the same time insure itself better against
externally induced crisis by creating more diversified linkages.

Key words: small open economy, state-owned enterprise, political economy, macroeconomic
stabilisation, governance, governance

RPS #2002-004 (BP)
Linda Low
“Rethinking The Singapore Development State And Growth Model”

Even before the Asian crisis, Singapore has been recharting its growth and development
strategy toward information, communication technology (ICT) and knowledge-based
economy (KBE). As a top globaliser, its small, open, city-state macroeconomics have grown
more and further apart from its ASEAN partners in its bid to continuously leverage itself in
the globalised new economy with its ageing demographics and domestic constraints. Policies
range from fundamental economic ones to socio-political ones as it rises to the challenges of
greater democratisation which come globalisation, ICT and KBE. The economics a “flow-
through” growth model tapping resources, capital, talents, skills, technology and markets
from the region and the world must be balanced against the political economy aspects of
unravelling Singapore Inc. A more private sector-led growth model requires emphasis on
creativity and innovativeness, removing the enigma of a state-dominated top globaliser,
more privatisation and Internet deregulation and not mere international competitiveness
and socio-political stability as its traditional attractions. Yet, with inequity and globalisation
backlash, no less greater risk and uncertainty in the emerging globalised new economy
context, the government is hard put to ignore totally its paternalistic philosophy as it
considers new Singapore shares as the “trustee of the last resort”.

This paper takes a political economy approach to trace the rationale, motivation and process
of a new Singapore economy, society and polity. It is already forging bilateral and cross
regional trade pacts over and above its commitment in ASEAN and AFTA and multilateralism.
It appears proactive and ever stirring the pot as it worries over its options and policies.
While it has to answer to its intrinsic national needs in an evolving development model, this
has to be carefully balanced with interests of neighbouring states in ASEAN as Singapore
thrives and survives on regional as much as global prosperity and well-being. Whether a
diametrically opposed model or an exemplary one may be offered by Singapore is an
interesting conclusion as much for itself as for ASEAN and Asia.

RPS #2002-005 (BP)
Linda Low
“Rethinking Singapore Inc And Glcs: From Soe-Soe To Soe-Poe”

Singapore’s developmental state has proven its worth in the old economy where state-led
industrialisation spawned Singapore Inc and its government-linked companies (GLCs). But
as Singapore recharts its growth and development strategy from a small open economy
(SOE) which is also dominated by state owned enterprises (SOE) toward information,
communication technology (ICT) and knowledge-based economy (KBE) as a top globaliser,
Singapore Inc and GLCs cannot remain as they have been. If the new globalised KBE means
creativity, innovativeness and private sector-led corporates and management, it may not be
enough that the state takes charge as it has been doing in macroeconomic, infrastructural
and across-the-board policies to catalyse growth and development. With ageing
demographics and other domestic constraints, GLCs have also had to look into foreign
talents and skills, regionalising and globalising to tap resources and markets as well as to
privatise as government ownership constituted a poor image outside of Singapore. There
are socio-political implications as well as economic ones and rethinking Singapore Inc and
GLCs in privatising to reduce ownership but not necessarily control to maintain the political
nuances is a huge dilemma and challenge. Greater democratisation and choices come with
globalisation, ICT and KBE.

This chapter takes a political economy approach to trace the rationale, motivation and
process of a new Singapore Inc and what to do with its stable of GLCs. As Singapore
leverages into a more high technology manufacturing and service economy and if GLCs are
unlikely to disappear but would remain, however defined, how they should reengineer to
remain relevant must be considered. The broad direction and goals may have been set in
motion but the pace and progress may have been slow as much constrained by domestic
constraints as fast changing regional and global trends. The SOE-SOE model to SOE-POE
strategy with private owned enterprises as the vanguard of the new economy and more
democratised state may, however, take more than wishful cosmetic surgery.

RPS #2002-006 (MKTG)
Khai Sheang Lee, Wei Shi Lim and Siew Lien
“Simmarketing Of Credence Products: A Game Theoretic Perspective On The
Underselling Of Antiques”

This paper seeks to provide a rational explanation as to why authentic antiques are
knowingly undersold at prices that are significantly below their actual worth. Using a game
theoretic approach, we show that uncertainty and non-verifiability of the quality of credence
products (in terms of authenticity) post-purchase result in adverse selection, such that
reputable auctioneers are more likely than less reputable resellers to reject items offered to
them for auction, even though these items might indeed be authentic antiques. A direct
consequence of such adverse selection is the observed plural channel structure comprising
auctioneers and dealers of different reputation in the market for antiques, whereby less
reputable resellers knowingly undersell authentic antiques that were rejected by the more
reputable resellers. Reputable resellers thus perform the role of quality screening,
commanding premium prices for the antiques they sell, whereas less reputable resellers fill
the role of market clearing, selling antiques at prices that commensurate with buyers’
confidence of the product’s authenticity. In turn, this implies that a low price does not
signal the lack of quality in credence products. While the results suggest that a reseller’s
reputation might serve as a signal of quality for credence products, it is important to note
that such a signal is imperfect, as the quality of credence goods, by definition, is not
verifiable with certainty, and hence, the potential for moral hazard behaviors by sellers is
always present.
RPS #2002-007 (MKTG)
Khai Sheang Lee, Soo Jiuan Tan & Kwon Jung
“A Structural Model Of Market Orientation Effects On Entrepreneurial Values And
Performance Of Smes”

This paper proposed and tested a structural equation model of the causal relationship
among the components of market and entrepreneurial orientations and the performance of
small and medium enterprises (SMEs). The empirical findings are mostly in agreement with
our postulation that a SME's market orientation in terms of its customer and competitor
centeredness drives its entrepreneurial values in innovativeness, risk-taking propensity, and
proactiveness in business decision-making, thereby impacting its performance. Research
and managerial implications of our study are discussed.

Key Words: Market Orientation, Entrepreneurial Orientation, Small and Medium Enterprises,
Organizational Performance, and Structural Equation Model.

RPS #2002-008 (MO)
Ronald A. Rodgers & Mark E. Barnard
“Social Exchange Vs. Internal Norms And Values: The Limits Of Bilateral Influence
In The Employment Relationship”

To examine the process by which employers and employees are able to influence each other,
a theoretical model based on the principles of social exchange and reciprocity is presented
and empirically tested. A structural equation model is used to test the relationships
between the pairs of variables that are predicted by the theoretical model. This analysis
showed strong relationships between what each party expected to receive from the opposite
party and what it reported that it needed to contribute, but the analysis did not provide any
evidence of an effective flow of influence from one party to the other. When the data were
re-analyzed using a SEM model that also took organizational commitment into account, the
results showed (1) that the inclusion of this work-related attitude made it possible to
account for a significantly larger proportion of the variance in the employees' performance
obligations, but (2) input from the organization explained only a small portion of the
variance in organizational commitment.

 Literature relating to internal values, social identity and complementary role relationships is
introduced to explain how a stable employment relationship that meets the respective needs
of the parties may be possible even if the parties are not able to effectively influence each
other through social exchange and reciprocity. The paradoxical conclusion is that the
parties often engage in exchange-based behavior that does not result in effective bilateral
influence, and they are often responsive to each other in a way that does not reflect social
exchange considerations.

Key words: employment relationship, social exchange, reciprocity
RPS #2002-009 (FA)
Chee Kiong CHNG
“Board Independence And The Shielding Of Ceo Pay From Unusual

Given that earnings is a significant determinant of CEO compensation, the general pattern
that emerges from U.S. studies is that gains (losses) from unusual transactions, such as
change in accounting methods and restructuring events, are on average not shielded
(shielded) from affecting CEO compensation. This paper contributes to the literature by
proposing that the extent of shielding is the outcome of bargaining between the board and
the CEO, and this outcome depends on the independence of the board from the influence of
the CEO. Ceteris paribus, the more independent the board is, the more likely it will succeed
in arguing that unusual gains (losses) are not controllable (controllable) by the CEO, and
are not beneficial to the company, and so it will shield the pay effects of the gains (losses)
to a greater (lesser) extent. The board is regarded as more independent, and thus more
influential than the CEO, if it has a non-CEO chairman, or if it consists of proportionately
more independent directors.

This study is conducted using Australian CEOs’ compensation data for 1987 to 1995. The
unusual transactions studied are those reported as abnormal items and extraordinary items
in the financial statements of listed Australian companies. As hypothesised, results show
that the extent of shielding of unusual gains (losses) varies directly (inversely) with the
presence of a non-CEO chairman of the board. Due to institutional differences between U.S.
and Australia, the results of this paper present a different perspective to the CEO
compensation and corporate governance literature.

KEY WORDS: CEO compensation, Board independence, Unusual transactions

RPS #2002-010 (MKTG)
Jochen Wirtz, Teo Swee Cheok, and Anna S. Mattila
“The Roles Objective And Self-Assessed Knowledge In The Consumer Search

Previous research provides evidence for a conceptual distinction between self-assessed and
objective knowledge (e.g., Brucks 1985; Park et al. 1994), and relatively little is known
about the relationship between knowledge and information search (Ratchford 2001). The
current research provides empirical evidence for differentiating the two knowledge types.
Furthermore, it suggests that the relative effects of the two types of knowledge on pre-
purchase information search depend on the type of information source. Consistent with prior
research, this study shows that self-assessed knowledge is strongly linked to the
consumer’s use of personal sources of information, including internal memory searches and
word-of-mouth communication. Conversely, objective knowledge seems to have a positive
impact on the consumer’s motivation to seek external information (e.g., newspaper articles,
mass media sources) about the service provider. Managerial implications for professional
service providers are discussed.

Keywords: credence services, product knowledge, information search
RPS #2002-011 (DS)
Thompson S H Teo & Jek Swan Tan
“Senior Executives’ Perceptions Of Business-To-Consumer (B2c) Online Marketing

This paper represents one of the first few studies on Internet marketing strategies of B2C
firms in Singapore. A survey was sent to CEOs/Marketing managers of 400 firms, of which
92 usable responses were obtained. The results of hierarchical regression analyses indicate
that strategies to attract customers and to relate to customers have significant positive
relationships to online brand equity. In addition, online brand equity is positively related to
financial growth. Implications of the results are discussed.

KEY WORDS AND PHRASES; B2C, online marketing, strategy, brand equity

RPS #2002-012 (DS)
Thompson S H Teo & Vivien K G Lim
“Language Planning And Social Transformation Strategies To Promote Speak
Mandarin Campaign In Singapore”

This paper examines the evolution and social transformation of the Speak Mandarin
Campaign in Singapore for the past twenty years. It examines how various media were
mobilized to promote Mandarin rather than dialects among the Chinese community. The
analysis provides insights regarding the effectiveness of various policies and social
transformation strategies to promote the use of Mandarin in Singapore.

Keywords: language planning, Singapore, Mandarin, policy, media

RPS #2002-013 (DS)
Thompson Teo & Pian Yujun
“A Contingency Perspective Of Web Adoption And Competitive Advantage”

This paper examines the contingency factors affecting Web adoption, and its impact on
competitive advantage. A questionnaire survey is used to gather data for this study. The
results indicate that proactive business technology strategy is a key factor associated with
Web adoption. The impact of Web adoption on competitive advantage tends to be
associated more strongly with innovation and growth. Cost reduction and alliance
advantages can also be strengthened by Web adoption, but to a lesser extent.
Differentiation advantage is affected the least. Implications of the results are discussed.

Internet, Web, adoption, contingency, competitive advantage
RPS #2002-014 (BP)
Pien Wang & Andrew C Inkpen
“China-Singapore Suzhou Industrial Park”

The China-Singapore Suzhou Industrial Park Development Co. Ltd. (CSSD) was established
in 1994 to develop a 70 square kilometer Singapore-style township, China-Singapore
Suzhou Industrial Park (SIP). The CSSD was a 65-35 joint venture between a Singapore
consortium and a Chinese consortium from 1994 to 1999.

The purpose of the SIP project is to transfer Singapore’s knowledge in developing an
integrated industrial, commercial, and residential township to Suzhou. To accomplish this
purpose, the Singapore partner has deployed more than 100 officials, engineers, and
managers to the SIP to impart knowledge to their Chinese subordinates. In addition, the
Singapore government has also provided extensive and systematic training programs to
more than 700 Chinese officials to equip them with necessary skills and knowledge.

Although the SIP is a priority project that enjoys the support of top leaders from both
countries, the project has encountered many obstacles as a result of lacking of trust
between the Singapore partner and its local counterpart, intense competition from a local
rival park, different mindsets of people involved in the project, misalignment between the
interests and efforts of the local partner, insufficient understanding of the counterpart’s
culture and system, inherent difficulty in transfer software (i.e., know-how required to run
an industrial park), etc.

The frustration finally led the Singapore side to reduce their equity stake from 65 percent to
35 percent in 2000. As the majority partner owning 65 percent of the equity of the CSSD,
the Chinese side assumes the management control. Furthermore, the Suzhou municipal
government has been devoting significant resources to support the continual development
of the township. Many officials from other Chinese cities have also visited the SIP to acquire
the knowledge of managing a successful industrial park.

RPS #2002-015 (MKTG)
Jochen Wirtz, Anna S Mattila& Teo Swee Cheok
“The Effects Of Consumer Expertise On Evoked Set Size And Service Loyalty”

There is a growing interest in understanding how consumer preferences and choices vary
with experience in a product/service category. Previous research provides support for a
conceptual distinction between self-assessed or subjective knowledge and objective
knowledge. Yet relatively little is known about the impact of these two knowledge types on
consumers’ pre-purchase choice and service loyalty behaviors. To bridge that gap, this
study examined the relative influence of subjective and objective knowledge on choosing a
physician and on remaining loyal to the chosen provider. Our findings indicate that high
objective knowledge translates into larger consideration sets and decreased loyalty.
Although subjective knowledge also had a positive impact on evoked set size, its magnitude
was smaller than that observed for objective knowledge. Furthermore, unlike its objective
counterpart, self-assessed knowledge did not reduce service loyalty.
Key words:    Consumer       expertise,    objective  knowledge,      subjective/self-assessed
knowledge, service loyalty, evoked set size.
RPS #2002-016 (MKTG)
Mäkinen, Saku
“Cross-National Technology Adoption, Take-Off Phenomenon And Lead-Lag Effect:
Analog Cellular Technology In The Apac Region”

Recent research has documented diffusion of new technologies internationally to show a
lead-lag effect in cross-national adoption. Leading countries demonstrate a slower rate of
adoption than the lagging countries when technology is introduced in a cascading fashion to
national markets one-by-one. Dynamics of national technology adoption has also been
shown to follow initial slow growth pattern subsequently replaced by a rapid increase in
growth rate introducing a take-off point in adoption. An unresolved question is the existence
of the lead-lag effect in the timing of national technology adoption take-off. This paper
empirically tests the foundations of take-off phenomenon and the lead-lag effect. Analog
cellular telephone subscriber data from Asia Pacific region is used to demonstrate the
existence of the take-off phenomenon and the lead-lag effect in the timing of national take-
off points.

RPS #2002-017 (MKTG)
Mäkinen, Saku, Peura, Masa, Näsi, Juha
“Strategic Motives For Alliances In Mature And Changing Industries”

The literature on alliances and partnerships has traditionally identified many differing
motives that companies can have in engaging themselves in collaboration with other
business entities. This paper explores the alliance motives of companies in changing and
mature industries by clustering various existing motives into pre-specified strategic alliance
motives. These motives were then subjected to evaluation by practicing executives in
Finnish companies operating in changing and mature industries. This study confirmed earlier
research results on importance of certain motives. The study also verified some differences
between motives in changing and mature industries.

RPS #2002-018 (MKTG) 2002
Mäkinen, Saku, Peura, Masa, Näsi, Juha
“Strategic Motives For Acquisitions In Mature And Changing Industries”

The literature on acquisition motives has traditionally identified a myriad of differing motives
that companies can have in engaging themselves in acquisitions. This paper explores the
acquisition motives of companies in changing and mature industries by clustering various
existing motives into pre-specified strategic acquisition motives. These motives were then
subjected to evaluation by practicing executives in Finnish companies operating in changing
and mature industries. This study confirmed that there are, indeed, differences between
acquisition motives in this industry level.
RPS #2002-019 (MKTG)
Kau Ah Keng, Kwon Jung & Jochen Wirtz
“Segmentation Of Library Visitors In Singapore: Learning And Reading-Related

Singapore is a small country with a resident population of about 4 million. However, it
registered 1.86 million members in its national library system in 2000. Nevertheless, very
little is known about this group of people other than their basic demographics and library
usage frequency. The objective of this study is therefore to examine who these people were
in terms of their values and lifestyles. Based on a sample of over 800 residents in
Singapore, this study adopted a personal interview method to solicit information not only
about their demographics but also their learning and reading-related lifestyles and values.
Using factor analysis and cluster analysis, it was determined that they could be segmented
into seven groups of library users, each with distinct demographics, values and lifestyles.
Specific strategies to reach these groups of library users were also suggested.

RPS #2002-020 (DS)
Ruey-lin Hsiao, Stephen Tsai & Ching-Fang Lee
“If We Can Codify What They Know: Exploring The Resistance To Knowledge
Management Systems”

This study examines the constraining role of information systems in managing
organizational knowledge. Previous studies of information systems have analyzed resistance
from the perspectives of technological, organizational and social acceptance. However,
these perspectives may not be sufficient for understanding resistance to knowledge
management systems. Taking a situated knowledge perspective, this study re-examines the
prevailing practices in codifying knowledge as well as in accessing expertise. A selected case
study of a semiconductor equipment provider is analyzed to explore why knowledge
management systems were not accepted in spite of previous adoption success. The research
findings indicate that the tacit nature of knowledge, characterized by experiences, reciprocal
task-structure, and human networks, cannot be codified easily into knowledge repositories.
In addition, this study calls for a re-examination of knowledge conversion theory (Nonaka,
1994) and emphasizes how the inconvertibility of tacit knowledge may have an impact on
information systems acceptance.

Keywords: situated knowledge perspective, knowledge              conversion,   knowledge
management systems, information systems acceptance.

RPS #2002-021 (BP)
Linda Low
“Social Security And Social Welfare Protection In The New Economy”

Labour is the Achilles’ heel of globalization and the new economy has also turned traditional
employment relationships including social security and protection upside down. This paper
aims to relook the issues arising by first reviewing definitions and concepts of social policy,
social security, social protection and social welfare safety net, globalization and new
economy, their interrelationships. This overall impact is applied to the Asian context in
terms of issues and policy implications. In identifying the conceptual and empirical trends,
the paper intends to provoke ideas rather than aspire for ready-made policy solutions or
resolutions. Some points could be on the agenda for further research and roundtable
discussion for United Nations Economic and Social Commission for Asia Pacific (ESPAC) and
related agencies. The underlying premises of poverty alleviation and improving the
economic and social welfare of workers are intrinsically salient to growth, any worsening
would impinge on economic efficiency and productivity.

RPS #2002-022 (BP)
Linda Low
“Entrepreneurship Development In Ireland And Singapore”

Ireland and Singapore have many striking similarities despite varying political ethos and
culture. Both economies are striving toward a knowledge-based economy (KBE) based on
information communication technology (ICT) in a highly globalised context. Both have been
ranked as the top globaliser, Ireland in 2001 and Singapore in 2000 by AT Kearney in
Foreign Policy Magazine. In terms of sustainability for economic growth and development,
both economies recognise the critical role of their local enterprises and indigenous industry
in general and entrepreneurship in innovative and creative activities, in particular. Both the
Celtic tiger and Singapore as developmental states have favourable government
intervention including the all-important aspect in human resource development and
entrepreneurship education and training at the university level in pursuit of sustainable
growth. Faced with a more competitive and highly volatile global economy, the two may
learn lessons from each other and share experiences with other economies in their
respective regions on enterpreneurship or enterprise development. This paper will analyse
the prospect of such a generic entrepreneurship developmental model.
Keywords: knowledge-based economy, information communication technology, technology
brokers, new wave migration, disapora, enterpreneurship education.
JEL classification: M13 Entrepreneurship

RPS #2002-023 (MKTG)
Jochen Wirtz
“Halo In Satisfaction Measures – The Role Of Purpose Of Rating, Number Of
Attributes, And Customer Involvement”

Firms usually measure customer satisfaction on an attribute-by-attribute basis in order to
identify and improve potential weaknesses, and to fortify their strengths in service delivery.
However, research has shown that halo can threaten the interpretability of such data. Also,
halo is particularly acute in satisfaction measurement of services with a high degree of
ambiguous and credence attributes. This paper examines three halo-reducing methods
developed in psychology and organizational behavior in the context of customer satisfaction.
The perceived purpose of evaluation (evaluative vs. developmental) and the number of
attributes measured (few vs. many) were examined in an experimental design, and the
level of product involvement (low vs. high) was examined using a quasi-experimental
The data showed reduced halo when the respondents were presented with the development
rather than evaluative purpose, when more rather than less attributes were measured, and
when subjects were highly involved with the service.

RPS #2002-024 (DS)
H. Brian Hwarng
“Indicating When Autocorrelated Time Series Shifted Using Neural Networks”

The main purpose of this paper is two-fold: (1) to present a neural-network based
methodology for monitoring process shift in the presence of autocorrelation; and (2) to
demonstrate the power, the effectiveness, and the adaptability of this approach. The
proposed neural network uses the effective and efficient extended delta-bar-delta learning
rule and can be trained with the powerful back-propagation algorithm. The comparative
study on AR(1) processes shows that the performance of this neural-network based
monitoring scheme is superior to that of SCC, X, EWMA, EWMAST, and ARMAST control
charts in most instances. Moreover, the network output can also provide information about
the shift magnitude. The study of run length distributions suggest that further improvement
on designing such neural networks in possible. The adaptability of the neural-network
approach is demonstrated through the flexible design of the training data set. To further
improve run length properties under various shift magnitudes, alternative control heuristics
are proposed.

RPS #2002-025 (DS)
H. Brian Hwarng
“What Is The Real Source Of Root Cause: Simultaneous Identification Of Mean
Shift And Correlation Change”

In this paper, we propose a neural-network based identification system for both mean shift
and correlation parameter change. The identifier is trained to detect mean shift, to
recognize the presence of autocorrelation, and to identify shift and correlation magnitudes.
Various magnitudes of process mean shift under the presence of various levels of
autocorrelation are considered. Both in-control and out-of-control average run length are
computed to measure the performance of the trained identifier. In addition, we also
measure the correction classification rate of shift and/or correlation magnitudes. When
properly trained, the networks are capable of simultaneously indicating whether the process
change is due to mean shift, correlation shift or both. New summary statistics are derived to
provide these measures. This approach is unique since all the statistical control charts
developed so far can only detect mean (or variance) shift or parameter change when the
deviation is beyond a certain specified control limit but incapable of distinguishing whether
the shift is due to mean, correlation change, or both when they are concurrently taking
place. The result is significant since it providers additional specific information about the
process change; therefore it narrows down the scope of the assignable causes and speed up
the troubleshooting process.
RPS #2002-026 (BP)
Linda Low
“Singapore One: The Hard Techno-Infrastructural And Soft Socio-Economic

Singapore One as broadband infrastructure is the city-state’s answer to harness information
communication technology to move to a knowledge-based economy, attain industrialized,
developed country and knowledge society in one fell swoop. The intelligent island is a reality
as hard infrastructure to wire networks and applications is well funded and directed by a
slew of policies in an interventionistic developmental state as part of economic survival and
sustainability. The commitment to soft infrastructure in human resource development,
education and training is commensurable with Singapore One. The enigma lies in the
regulatory framework over content and softer socio-cultural and political issue for a full-
fledged knowledge society. The extent and pace of change of political ethos and culture may
not be as synchronized with other achievements of the intelligent state. Rather than
adjudged as obstructing liberal democratization conventionally perceived a natural parallel
to the economics of materialistic affluence, the paper argues that evolution to freedom in
speech and open communication facilitated by information communication technology will
come in its own way and time. Neither need a knowledge society be necessarily a clone of
Western democracy as Singapore will eventuate through its natural socio-political culture
what suits its heritage and vision. This is neither over ambitious nor patronising given the
image of a controlled and suppressed polity and society. In the final analysis, how well
Singapore One’s hard and soft aspects are consonant and concerted in socio-cultural,
political and economic aspects will be set and paced by Singapore’s interdependence and
integration in the global market and global community.

Keywords: Singapore One, Internet, intelligent island, third-generation high-speed wireless
service, knowledge-based economy, knowledge society

RPS #2002-027 (BP)
Linda Low
“Singapore Inc For Competitiveness And Global Economy: The Promise And

This paper examines the proposition is Singapore faced with structural challenges from
global, regional and technological sources, must realign to have the private sector drive the
new economy. However, the political economy process and culture of Singapore Inc is a
domestic structural challenge, in and of itself, both a fundamental strength and weakness.
At the heart of the proposition are two interrelated hypotheses inserted into any realistic
policy recommendation to sustain a competitive globalised economy. The first hypothesis is
if private sector’s corporate activism is more suited for the new economy, by implication,
Singapore Inc or the developmental state driving industrial policy in the old economy either
has to go, be dismantled and privatized or remake itself to be more private, however
defined. The remaking of Singapore Inc as in the Economic Review Committee and new
Temasek Charter has to synchronise government in business to be part of the domestic
corporate sector in a conducive business environment working with market forces. The
second hypothesis is the political economy of a government-made city state can withstand
the unraveling to loosen Singapore Inc’s economic grip which has finessed the political
regime since 1959 to garner financial resources and political legitimacy. This paper aims to
evaluate the ensuing dilemma for Singapore Inc, how to be competitive in the new global
economy by recharting its direction and focus without losing the political economy value
built up thus far, that is, having it both ways. A number of paradoxes and puzzles emerge
given Singapore’s sui generis model of growth and wealth accumulation. How the leadership
rationalises or redefines the structural parameters of Singapore Inc in the context of
changing time and environment is indeed a huge promise which has to be realistic, credible
and deliverable. Given path dependency or what has been historically set, especially if it
were successful institutions and policies, the tendency and probability of changing that
drastically requires tremendous political will, even a regime change in some countries.

RPS #2002-028 (BP)
Linda Low
“Motivations And Prospects For Forum For East Asia-Latin America Cooperation”

EALAF was renamed FEALAC as the first ministerial meeting concluded with an initial
framework document on objectives, principles and modalities in 2001. As there is little by
way of progress and evaluation to be made, this paper considers the political economy
implications of the design and make up of FEALAC, noting the vision and the reality in the
emerging global economic and geopolitical environment. That FEALAC is set up as a project
of foreign ministers ant not some trade liberalization, economics and business matters like
APEC or a cultural rapprochement as in ASEM may be a start in the first instance on
international relation before advancing deeper and further. It is not simple for a group of
some 30 developing countries to plunge headlong into trade and economics. With an
unsettled global economic environment such as it was in 2001, FEALAC is treading
cautiously and not even convening itself as a block developing countries in a multilateral
setting. However, that it could and must go beyond to fulfil all aspects of its
multidisciplinary terms of reference will be the premise taken in this paper.

RPS #2002-029 (MO)
Ronald A. Rodgers & Mark E. Bernard
“Psychological Contracts And Employment Relationships: Integrating Employee
And Employer Perspectives”

Individual and organizational perspectives relating to psychological contracts and the
employment relationship are explored, based on an examination of three issues: 1) the
relationship between employees’ perceptions of their own obligations and their perceptions
of their employers’ obligations; 2) the impact on employees’ attitudes and performance of
the employees’ perceptions of (a) their employers’ obligations, (b) the organizational
contributions that are actually provided, and (c) the discrepancy between obligated and
provided contributions. 3) the impact of the contributions and demands reported by
supervisors on employees’ perceived obligations. To assess these issues, equivalent
multiple-item scales were used in the questionnaires administered to 1999 staff nurses in
hospitals in Singapore (employees), and in the corresponding questionnaires and
performance appraisal reports completed by their supervisors.

Employees who perceived their obligations to be high reported more favorable attitudes and
received better performance appraisal scores, regardless of whether they perceived their
employers’ obligations to be high or low; but employees’ perceptions of their employers’
obligations were found to have an indirect positive impact on the employees’ attitudes and
performance. Perceived organizational contributions are also significantly associated with
employee attitudes, but are only moderately or weakly associated with appraised
performance. When the impact of perceived contributions is taken into account, the
discrepancy between expected and perceived contributions has no incremental adverse
impact on employee attitudes or performance. Finally, employees’ perceptions of their own
performance obligations are strongly influenced by the employees’ expectations of
organizational contributions, but they are affected only slightly by the supervisors’
expectations or contributions.

Key words: psychological contracts, employment relationship, bilateral influence

RPS #2002-030 (DS)
H. Brian Hwarng & Cynthia S.P. Chong
“Modeling A Complex Supply Chain: Do Not Oversimplify It”

The benefits of coordinating activities and consolidating distribution points in supply chains
are well highlighted and intuitively logical. However, the impact of these decisions on the
overall performance of a complex supply chain, may not be as obvious as usually perceived.
This study models a relatively complex supply chain and evaluates the impact of simplifying
demand and lead time assumptions under various supply chain configurations. Of particular
interest is the investigation of the effect of risk pooling and the synchronization of
production cycles in a multi-level multi-retailer supply chain under the influence of various
parameters such as batch size, delivery frequency, and ordering cycle. This study shows
that the intricacy of the complicated interaction effects among various factors in a complex
supply chain, can be better understood only with a simulation model.

Keywords: Supply chain management, Simulation, Logistics, Inventory

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