No professional leaders at state enterprises

opinion June 28, 2012 00:00

By Suthichai Yoon
The Nation

6,646 Viewed

Several state enterprises, including Thai Airways International (THAI) and the Mass Communications Organisation of Thailand, are inviting candidates for the position of chief executive officer.

But they aren’t going to get any professionally qualified managers to apply. The best and the brightest just don’t want to work for them.

That’s not because there aren’t enough qualified people who are keen to try their hand at running a major state enterprise that should be more competitive against peers in the region.

Neither is it because the finances and prestige aren’t there.

The most obvious and recurring problem is that, from the outset, the selection committees assigned to pick the most qualified person to become the CEO just aren’t qualified themselves.

The rotten system begins with the process of picking members for the screening committee. They have to follow the instructions, direct or otherwise, from “the boss up above”.

The more prestigious the position, the higher the rank of the person who gives the order about who must get the CEO post.

Therefore, lobbying starts at the selection of the selection committee members. They have to be ready to play the game, meaning that, whatever the requirements published in advertisements calling for candidates, the selection process will still have to end up with just one person in mind. Other candidates are eagerly sought only so the whole exercise can appear to be fair and transparent.

When the selection committee is “orchestrated” like this, what do we expect the final outcome to be? In the end, while the process of picking the next manager to run the state enterprise may appear to be open and fair, the heavy political manipulation inherent in the system will produce only mediocre leaders at best and political cronies or lackeys at worst.

From time to time we get a professional executive in the post by default. He sets about overhauling the organisation, trying to “de-politicise” the enterprise and getting the staff to stick to a key performance index (KPI) rather than a “please the politicians index”. But this only promises to make his term a short-lived one. He may leave some marks of professionalism, only for them to be wiped out by the next CEO who’s been picked after the rigorous screening of the selection committee. The “typical guy” is finally back in office.

Piyasavasti Amaranand was one of the few “professionals” who was taken on board a leading state enterprise (THAI) and was then unceremoniously kicked out. The board checked his KPI and he got a nice pass rating of better than 80 per cent, but he was told to leave anyway.

His crime? The board’s official reason given to the public: “Lack of proper communications with the board of directors.” That suggests that the board would only tolerate a CEO who was ready to obey orders and not someone who would challenge its line of thinking.

The real question therefore lies not with the CEO but with the board of directors of a state enterprise. How is the board selected? That’s the real question. The system seems neither transparent nor fair.

Boards of directors of state enterprises are usually picked by Cabinet members whose only yardsticks are whether the directors can serve the politicians’ interests or not. It is therefore small wonder that we can’t expect a professional CEO to last in any state enterprise, considering the fact that we don’t get a professional board of directors in the first place.

Directors don’t get sacked for being unable to communicate well with the CEO. It’s because they only keep a CEO who can follow instructions from the board, which get its marching orders from Cabinet members, who have to follow their own bosses’ instructions in the first place anyway.