Singapore Is #1 According to KPMG’s 2013 Change Readiness Index – Here’s What That Means

Jeff Cuellar



Change is coming. That’s quite a powerful statement, isn’t it? “Change” is one of those powerful keywords that’ll either have you smiling from ear to ear, or cowering in fear because change isn’t something you want.

When it comes to change, can you really measure it on a national level? Can you really get a better picture why some countries are able to adapt to global environmental, political, economic change faster than others?

Those are questions that KPMG, one of the world’s “Big Four” professional services firms, sought to answer when it recently released its 2013 Change Readiness Index (CRI).


What’s an Index Anyway?

Wondering what an index is? In short, it’s a summary and ranking of a complex idea (ex. cost of living) that’s created by measuring multiple factors and combining them to create a single “score.”

For example, if you’re creating an index to measure the cost of living, you wouldn’t just look at the cost of products. You would also measure inflation, transportation, and housing costs.

Then you would “rank” each and combine them to create one composite score.

As for indices, Singapore ranks pretty high on several:

Oh, I forget to mention that Singapore is also ranks pretty low on others – 150th in the World Press Freedom Index (WPFI).


What Is the KPMG Change Readiness Index (CRI)?

KPMG’s Change Readiness Index (CRI) measures a nation’s ability to respond to long-term global change trends in the economy, environment, demographics, and society. Currently, the CRI evaluates 90 nations around the world including Singapore.

Why is it important to measure a nation’s ability to change?

By measuring a nation’s ability and resilience to change – it’s easier for public and private sector organizations (government policymakers, NGOs, investors, enterprises) to see what risks and opportunities are apparent in each nation.

The CRI is based on 3 important factors:

  • Enterprise Capability:  Takes into account factors such as economic openness, innovation and R&D, business environment, infrastructure, trade policy, financial sector, etc.
  • Government Capability: Takes into account factors such as a nation’s economic framework, regulation, public administration, rule of law, government strategic planning, food and energy security, etc.
  • People & Civil Society Capability: Takes into account factors such as human capital, entrepreneurship, civil society, safety nets, technology, demographics, access to information, health, etc.


Why Is Singapore Ranked #1?

The short answer is that Singapore was pretty much engineered to adapt to rapid change. Think about it. In less than half a century, Singapore has progressed from being a third-world nation, to being in a prime position to overtake Switzerland as the world’s top financial hub.

That happened because of three key reasons:

  1. Singapore Has a Strong Government: Unlike other nations that have numerous political parties bickering about policy, Singapore’s government is strong and unified enough to drive immediate change within a span of weeks or months, not years.
  1.  Singapore Overcame Resource Challenges: Singapore’s lack of resources was the driver behind many of the nation’s biggest changes. Singapore had no real natural water resources, but it created new filtration methods and eventually developed NEWater. Singapore also had a shortfall in talented professionals, but it founded two world-class universities and brought in professionals from all over the world to overcome that problem.
  1. Singapore Is Very Business Friendly: Singapore’s one of the easiest places in the world to start a business and get credit. Not only that, Singapore has some of the lowest corporate taxes in the world, has a reputation for protecting investors, and is possibly the easiest nation on earth to trade across borders.

“The CRI reflects the prioritization that Singapore has placed over the last 49 years on improving the nation’s economic development and quality of life,” says Satyanarayan R (Satya), KPMG’s head for Government& Infrastructure in the Asia Pacific. “Singapore has actually addressed some global issues such as resource stress and climate change ahead of the world, in part because of our inherent position of adversity.”

Here’s a quick look at the top 10 nations on the CRI:

Overall CRI Country Enterprise Government People & Civil Society
1 Singapore 1 1 5
2 Sweden 5 2 1
3 Qatar 2 3 12
4 New Zealand 8 7 2
5 Germany 7 5 6
6 Israel 3 10 8
7 Japan 4 9 10
8 Saudi Arabia 6 4 20
9 Australia 15 8 3
10 United Kingdom 9 13 4

If you look at the CRI, it’s clear that Singapore has done exceptionally well in all three pillars, but most strongly in governance and enterprise,” says Timothy A.A. Stiles, Global Chair, International Development Assistance Services, KPMG. “That’s really what’s driving Singapore’s #1 ranking.”


What Challenges Lie Ahead?

Of the CRI, Singapore’s lowest score came from its #5 ranking on People & Civil Society Capability, which measures the individual, societal, and cultural aspects of change. Such a high ranking will probably come as a surprise to people who see many social shortfalls in Singapore society today.

Some of the biggest issues include government transparency, employment, and the need for a larger social safety net for Singaporeans.

As Satya points out, the government also faces another key problem in providing “greater integration in the delivery of public service with rising expectations from the citizens.”

“It all goes back to individuals demanding more and wanting to have better quality services. As time goes on, the ability of government agencies to integrate and deliver services in a seamless manner will become more and more important,” says Satya.

Employment will also be another change factor that Singapore will need to resolve. “As countries drive to raise the education levels of their entire populations, there needs to be a work opportunity for that educated population,” says Timothy. “You have to create that opportunity. Singapore is well placed to do that, but I think it will continue to be a challenge as people look for jobs not just in Singapore, but in the region.”


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Jeff Cuellar

I'm known by many titles: copywriter, published author, literary connoisseur, ex- U.S. Army intelligence analyst, and Champion of Capua.