On Your Own

The writer is an entrepreneur who hopes to share his experience and insights with readers who want to take that giant leap into business but are not sure if they should.

13/2018 – It’s a case of old habits die hard


This is the last time I will be away on a six-week stretch. It all started when I had to attend my Harvard Business School (HBS) AMP 182 annual class reunion in Lisbon, Portugal on June 20. As I had to attend two graduation convocations in London on July 11 and July 26, I decided to stay back in Europe and travel.

It was a big mistake. After two weeks, I miss the daily political announcements, my friends and our multicultural Malaysian food. I could find reasonably good Chinese and Indian food in London and New York but it was difficult to find authentic Malay curries and sambal.

So upon my return to Malaysia last week, I readily agree to join my local HBS-SMDP 2004 buddies for a Sunday breakfast outing at Warung Bunian in Kajang. My buddies claimed that Warung Bunian serves a unique egg wrapped nasi lemak with authentic sambal of onions and anchovies. Six of us agreed to meet up at the warung at 8am.

Ah Lai joined me for the drive to Sungai Merab Kajang and after half an hour past many highways, we turned into a side road which lead us to a small kampung with a smattering of wooden/cement houses over a spacious area. There were many cars parked on the grass at the side of narrow sandy roads.

We could see that the restaurant was packed to the brim with 20 to 30 people lining up to place their orders with a single cashier. Luckily for us, Sukri and Ah Foo were already lining up and Ghib had booked an uncleared table, chatting with a family that was about to leave. Despite the big crowd, the atmosphere was serene and everybody was waiting patiently.

Faris was the last to arrive even though his house is the nearest. Total strangers would just chat with our group. Sincere and gentle, kampung folks are the nicest and most genuine people that I have ever met. Sukri, who is from Kelantan, proudly claims that Kelantanese kampung folks are gentle and courteous all the time.

After facing some racist reactions in Long Island, New York, I was so happy to be home. Despite being the only Chinaman amongst the sea of Malays, the three of us felt comfortable chatting with total strangers and our Muslim brothers. Not forgetting the sambal ikan bilis was the best I have tasted for a long while, second only to my late mum’s home-made sambal belacan.

For more than two hours, there was no discussion about the current hot political topics on education, UEC, racial privileges, new corruption case, religion or Azmin vs Rafizi.

Ghib was advising us on how to handle more than one wife, Ah Lai was again lamenting on late payments from developers, Faris on his goat milk and skin care halal application, Ah Foo commenting on post GST car sales, Sukri and I on kampung family stories. Somehow the relaxed kampung environment shielded us from the political storm brewing nearby in Putrajaya.

Sometimes, I just wonder if all the perceived problems of the nation are manufactured and promoted by selfish politicians to prolong their hold on power.

Or are we all guilty of being racist by nature, stereotyping each race taught by our parents from young? Maybe not my generation but definitely over the last 30 years, the economic and education policies have polarised the various race even further rather than uniting the people.

The corrupt politicians unashamedly used race and religion to gather power and economic wealth whilst the poor remain downtrodden and fed scraps from spillover meals of greed. Hence the noble intention of gathering wealth through the state owned institutions for distribution to the poor was never achieved in totality.

The main reason was the involvement of politicians in the management of state-owned companies which strayed from state security interests of public utilities, infrastructure development into commercial businesses in every industry.

The expansion of the government’s involvement in commercial businesses created opportunity galore for mismanagement and corruption among its caretaker managers and politically-appointed directors.

I thought that our new government has this one golden opportunity to reverse the wrongs but I guess old habits die hard.

It had started its first 100 days with great promise as corrupt political appointees and civil servants were removed promptly. Irrespective of race and religion, the most senior and capable judges and lawyers were appointed to top posts in the judiciary and the Attorney General’s Chamber.

The new Malaysia got everyone excited.

But recent developments of the government inserting political appointees to the boards of GLICs and GLCs shows a reversal of the promised manifesto of non-political interference in state institutions.

One ought to remember that during the GE14 campaigns, Mat Sabu did a hilarious anecdote of 1MDB chairman reporting to the Finance Minister who reports to the Prime Minister who finally approved all the transactions.

The national car project was never a success so why raise another Titanic when the future is in electric cars? F1 was a major loss-making concern since its inception and our state financial standings can ill afford to suffer further losses.

In businesses, we have our profitable projects and those that had failed miserably. Similarly in nation building, political leaders leave behind legacies of great success and generally are forgiven for some failed projects. Let not your old habits feed your ego that will lead to a poor decision.

Of major concern is the current exercise of removing alleged corrupt political and technocrat leaders.

I am no fan of Wahid Omar and Azman Mokhtar but senior industry players who know the gentlemen find them as capable, hardworking and righteous technocrats. Paying them market wages is preferable to them amassing illegal gains on the side. Collateral damage from failure of the previous boss.

Perhaps Wahid and Azman might retire to their respective kampungs where they will find peace and tranquillity away from the maddening crowd.

Meanwhile I am planning to visit Warung Bunian again in search of the ultimate sambal. Old habits do die hard.

Published: https://www.thestar.com.my/business/business-news/2018/08/04/its-a-case-of-old-habits-die-hard/


12/2018 – Short and long-term strategies

I was sitting with my wife in Peacock Theatre hall attending the graduation ceremony of my youngest child, Andrea, just a few days ago feeling proud of her achievement of a second upper grade (B.Science in Management) at London School of Economics.

At the same time, I felt a sense of relief that I have completed my duties as a parent in providing the best possible education for my three children. Over the past eight and a half years, Andrea and her two older brothers (degrees in Mathematics/ Business Management) were educated from A Levels to their undergraduate degrees in the United Kingdom.

Her two brothers studied an extra year, achieving Master’s degree in Finance, but she was not keen to pursue any additional studies despite my urging of offering her fair opportunities to do so.

My three kids are considered very lucky kids, schooled in Malaysian private schools from Standard One to Form Five then off to top schools and universities in the UK without any assistance of scholarships. Less than 1% of our student population study overseas because their parents can afford the financial burden. To be able to study overseas, other bright students depend on scholarships from foundations, big corporates, government bursaries and institutions.

I have to thank my oncologist, Dr Rachael Khong and interventional radiologist, Prof Edward Leen for enabling me to attend this graduation ceremony. For the last four-and-a-half years, Dr Rachael and I have been very strategic in managing my Stage 4 colorectal cancer. We had drawn up short-term and long-term practical survival strategies.

My short-term strategy was based on the results of my CT/PET scan done every three months. If new tumours appeared, I would have Prof Edward ablate immediately and that happened frequently. In between, if new tumours appear regularly over a period of time, Dr Rachael will recommend chemo therapy treatments to keep the tumours down for a while. A delicate balance of not weakening my immune system too much and giving me a reasonable quality of life.

My long-term strategy was simply to stay alive to attend Andrea’s graduation, bearing in mind that less than 5% patients survived beyond five years.

For her successful efforts, I will be sending Dr Rachael some bottles of fine wine from Bordeaux as part payment of an incentive programme. Nothing comes free nowadays and that includes the ability to breathe naturally.

Like in all sustainable businesses, we conduct our operations based on strategic planning. Short-term strategies are actionable immediately whereas long-term strategies requires immaculate vision and the will to transform into a better and more profitable organisation. Visions should be simple and clear, easy to follow and with the right integrity of sharing common good among all stakeholders.

Amongst all the new Ministers, I believe our Education Minister has the most difficult task at hand. He is faced with many legacy problems, most of them based on long-term policies set by political leaders from the 1970s and 80s. Then over the last 30 years, the education system and its schools skewed sideways, separating students in race, language and religion.

Somehow, our Malaysian education policies have managed to increase our distance between unity and integration, perpetuate racial divide via language differentiation and continuous drop in teaching standards and quality of students.

And then there are restrictive policies for places in the local universities for non-bumiputras. Strangely, Malaysia is one of the rare countries in the world, where special rights are reserved for the majority rather then protecting citizens of minority interests.

I spent 13 years of my life in La Salle Petaling Jaya from Standard One to Upper Six (1967-1979).

We had to pass intermittent exams at Standard 5 or we have to stay back for another year and it was the same for Form Three (dropout if you fail badly) and of course the dreaded Form 5 exam where you have to pass your Bahasa Malaysia with credit (requirement for local universities and civil service employment). Nowadays you can get up to a Form Five education even if you fail your exams every year.

I was the first batch of students in the country to study History and Geography in the Malay language. Some batches later, the new students had to study maths and sciences in the Malay language.

I do not think it was a problem then except for the primary school students from Chinese and Tamil vernacular schools who had to undergo a one-year transition class called Remove class. The non-Malays coped with the new requirements which eventually required all subjects to be taught in the Malay language.

Due to racial politics perpetuated by Barisan component parties, Umno has the biggest say in national schools and universities so MCA and MIC started to lobby for its own schools and universities.

Hence the birth of semi government and private Chinese secondary schools. Nowadays you can be educated in a Chinese language school from Standard One to Form 6 where you end up sitting for the Unified Exam Certificate (UEC), equivalent to STPM.

In a strange twisted way of Malaysian politics, UEC was never recognised by our national universities. However, UEC is recognised by universities in Singapore, Taiwan etc and also our local private universities. My late brother’s three children all studied up to UEC level in Chinese schools. His eldest son had six distinctions out of nine papers in his UEC exams and was offered a place in Nanyang University of Singapore.

The other two siblings studied in local private universities and received loans from Klang Hokkien Association and PTPTN. Since all of them are working now, they have repaid the loan from the Association and started repaying the PTPTN loan. I had advised them to repay their student loans so that other students in need may receive the same financial assistance in their pursuit of further education.

The Education Minister should not rush into formulating a long-term education strategy. Perhaps he should assemble a group of eminent educationalist from all races to advise him. No harm to invite inputs from foremost educationist from other countries too as their inputs will be unbiased and unemotional. Just keep politicians and racists out of this group of advisors or you will get the same unhealthy advice.

Once you are ready with your long-term vision of what the national education policy should be, put your ideas out to the public to discuss, debate and refine. If you get 75% of all parents to buy in, then you will have their commitments and support for your vision.

It is your short-term strategy that you should worry more. Keeping to your promised manifesto is one. PH government was voted in on your clear vision and promises. Be brave and ignore the racists that put the nation in such a precarious position in the first place.

What are your short-term plans to improve teaching of English language in schools? How are you going to retrain 500,000 predominantly Malay teachers? I am sure Tun M is as anxious as we are to know more.

I would like to suggest that the Minister conduct some short-term trials at the school and university level. Create selected schools of unity and excellence.

Put in the best teaching staff irrespective of race. Medium of instruction should be in Malay as per school curriculum but emphasise on other languages especially English and Chinese (international language for business opportunities) and IT.

Enrolment should be based on population ratio by race with a sprinkling of students from ethnic Sabah and Sarawak. Watch the children mingle and grow.

Out of the 18 public universities, may I suggest you experiment with three universities, namely Universiti Malaya, Universiti Kebangsaan Malaysia and Universiti Sains Malaysia.

Reverse the enrolment restrictions. Protect the minorities with minimum number of places in every course. Enrolments should be based on merits and qualifications. Replace the deadwood lecturers and racists amongst them.

Bring in working professionals/practitioners from doctors, engineers to business experts to be part of the teaching team. You will be surprised what these universities can achieve within five years.

Extreme racism and extreme religion if left to fester in national schools and universities is like a growing cancer that requires a multi-disciplinary approach which is surgery, radiotherapy and toxic chemotherapy. Cut, burn and kill before it kills you. What is your short and long term strategies in curing the ills of our education system?

In the meantime, I need to reset a new long-term strategy when I meet my oncologist early next month. Perhaps to attend my son’s wedding in 18 months’ time? That would be a really nice thought to aim for.

Published: https://www.thestar.com.my/business/business-news/2018/07/14/short-and-longterm-strategies/

11/2018 – Creative talents are hard to find nowadays

I have been travelling the last two weeks on holiday, meeting friends and it was a good break from the gripping excitement of post GE14 activities. Honestly, this is the first time I truly miss being at home in Kuala Lumpur. Malaysia is now the happening country of the world with exciting breaking news beamed and going viral every waking hour.

Malaysian journalists never had it so good. Some old politicians and their goons are still around making empty threats at everybody including our famous Datuk Amar Singh. Ministers are not supposed to send out official statements in Chinese even if it is a translation copy of the press release in Malay.

Opposition parties and personalities speaking out and getting coverage by mainstream media. Now the local newspapers can print any story and the editors can also comment on it without any fear of losing their jobs or publication licence.

There was a Facebook comment from my journalist colleague which is a good reminder to the dumb and brainless. Her exasperated “Your money is stolen and you’re worried in which language it was taken?” sums up the frustration of those who can think clearly.

A thief is a thief. Whether you steal RM1 or RM1bil, you are still a thief. A thief does not recognise religion, race or language when he steals. A poor thief is one who steals a can of milk powder for her starving baby and goes to jail for two years. A dumb thief is one who robs a 7-Eleven store to feed his drug habits.

A smart thief is one who steals billions and still walks free. A brilliant thief is one who gives out part of his loot to everybody around him so that the whole extended family is part of the conspiracy. So now it becomes a family of thieves.

Catching a thief is a thankless job. Nobody gets any incentives or commissions for catching a thief. Maybe a promotion at best. It is no fun counting the loot knowing that you will not have any to spend on. Nor can you borrow the tiara for your daughter’s forthcoming wedding. You might be accused of stealing chocolates which is a potential occupational hazard of a policeman.

Putting the thief behind bars is a difficult job. A brilliant thief is smart and delusional. He has lied so much that he believes in his own lies. His lawyer from the extended family is able to spin stories that leaves the Attorney General speechless, lost in translation from English to Malay. I fail to understand what difference does it make if the AG says in the press conference, “tangkap pencuri” or “catch the thief” or “chook chat” in Cantonese. We are after all a multi-racial society and a Malaysian thief is a Malaysian thief, irrespective of race and language.

This new Pakatan Harapan (PH) government will have a tough time establishing control and order over the civil service. Expect many roadblocks and potholes ahead. Implementing the PH manifesto might not be easy after all. Separating the executive from the judiciary is even more difficult considering the deep-rooted problems of yesteryears.

Returning the independence of judiciary requires major detoxification of corruption at all levels so that the rule of law can be re- established.

The Malaysian judiciary and civil service is short of talent because of its hiring policies. The government’s hiring policy needs to be reformed. And it should be based on meritocracy and capabilities. You can’t reform the institution if you keep deadwoods. Bring in bright and experienced talents when necessary irrespective of race and language.

Like running any businesses, it is all about getting the right talents to help you manage the company.

Looking at the current batch of Ministers, Tun Dr Mahathir Mohamad will have to spend more time mentoring and guiding them as most of them are inexperienced.

When he has to appoint a 26-year-old from his party to be a Minister, Dr Mahathir must be scratching the bottom of the barrel in search of experienced and qualified talent. Being good in debates does not impress me one bit. Talk is cheap and young people tend to be careless with their mouths, ego and all. Hope I am proven wrong on this.

The public is assuming the new Ministers are on a three-month/100 days probation. It will be interesting to hear their first press conference. Will they be exposing one or two scandals in their Ministries? Maybe a simple SWOT analysis (strengths, weakness, opportunities and threats) of their Ministry? Visions and Missions. New directions?

I have only one wishlist for the new Ministers. Understand your subject matter thoroughly before making any comments. You do not have to sound smart. Just do not sound foolish.

It does not matter in what language you speak or what head gear you wear in your press conference, just remember you are on your own now and you are the focus of the press media for your 15 minutes of fame.

Last but not least, I notice from afar that the two hardworking campaigners of PH in GE13, Rafizi Ramli and Tony Pua are missing from the cabinet lineup. Perhaps, Dr Mahathir can consider giving them what they really want? No harm having the two movers and shakers to stir up a boring cabinet. Creative talents are hard to find nowadays … in whatever race and language.

Published: https://www.thestar.com.my/business/business-news/2018/07/07/creative-talents-are-hard-to-find-nowadays/

10/2018 – My wishlist to Economic Affairs Minister

Dear Datuk Seri Azmin Ali,

A belated greeting of Selamat Hari Raya Aidilfitri to you and your family. I hope you have rested well over the weekend. And congratulations to you on your appointment as Economic Affairs Minister.

Pending the announcement by Prime Minister Tun Dr Mahathir Mohamad on the rest of the ministries, we are uncertain as to the specific functions and scope of your ministry. From press reports, we understand your responsibilities may include the Economic Planning Unit (EPU), Petronas, government-linked investment companies (GLICs) and government-linked companies (GLCs). Effectively, the Economic Affairs Minister will be managing the wealth of the country.

According to an article in The Star dated June 6 by Edmund Terence Gomez, the professor of political economy at Universiti Malaya, in 2017 there were seven GLICs controlling majority stakes in 70 GLCs and additional investments of between 5-37% in another 140 listed companies, effectively controlling more than 60% of Bursa Malaysia’s market capitalisation. As the GLICs are controlled by the Finance Minister, the Government is now the biggest business corporation in Malaysia.

Petronas, wholly owned by the Government of Malaysia since 1974, is vested with the entire oil and gas resources in Malaysia. For 44 years, Petronas has been a major source of revenue to the Government in funding development projects and covering government operating expenditures.

Perhaps you may want to study the Norwegian oil fund, which is The Government Pension Fund Global, established in 1990. Funded by the surplus revenue of the petroleum sector, in May 2018, it has over US$1 trillion in assets, including 1.3% of global stocks and shares, making it the world’s largest sovereign wealth fund. It is now worth US$195,000 per Norwegian citizen (population 5.2 million).

The Norwegian oil fund is managed by a professional team at Norges Bank Investment Management, part of the Norwegian central bank on behalf of the Finance Minister.

Of the assets, 65% were equities and the rest were property (not more than 5%) and fixed income instruments. The fund is an active investor via company governance even though they are not involved in direct management of the investee companies.

Most of their investments do not exceed 20% of the investee market cap.

In Malaysia, this Norwegian oil fund will be known as a GLIC. So technically speaking, because they do not have controlling stakes in their investee companies, they have no GLCs in their portfolio of investments.

They do not have to assign nor appoint any CEO from their management team to any of these companies and they have the flexibility to sell their investments if they deemed their investment is at risk or having a poor return on investment going forward.

A local example will be our EPF selling all their shares in Felda Global Ventures Bhd last year despite realising an investment loss of RM203mil.

According to our learned professor Edmund, there are seven GLICs in Malaysia which comprise five savings and investment-based institutions, namely Permodlan Nasional Bhd (PNB), Lembaga Tabung Angkatan Tentera (LTAT), Lembaga Tabung Haji (LTH), Retirement Fund Inc (KWAP) and the Employees Provident Fund (EPF).

The other GLICs are Khazanah, which is the only sovereign wealth fund, and Minister of Finance Inc, which also incorporates many other companies like 1MDB, etc, as it wishes since MoF Inc is under the purview of the Finance Minister.


PNB was established in 1978 as one of the instruments of the New Economic Policy (NEP) to re-engineer the economic imbalance in Malaysian society. NEP’s main objective was to achieve a 30% share of the economic pie for the bumiputra community.

PNB has been highly successful in managing multiple units trusts with more than 13 million accounts. It is now the second largest fund manager after EPF with assets under management (AUM) of about RM 276bil. PNB controls about 10% of Bursa Saham market cap.

Since its inception, PNB has rewarded its unit holders with more than RM157bil in dividends and bonus.

PNB has been the most effective institution in the redistribution of wealth to the mass bumiputra community whereas previous policies of building successful bumiputra businessmen has resulted in immense wealth accumulated in the hands of a few.


LTAT was established in 1972 with the aim to provide retirement and other benefits to the members of the Armed Forces via a compulsory savings scheme. Members of the Armed Forces, numbering around 200,000, contribute 10% of their salary with the Government contributing 15%.

With an AUM of around RM10bil, it is the smallest savings and pension fund amongst the five GLICs.


LTH was set up in 1963 and act as the Malaysian Pilgrim Management and Fund Board. The main function of Tabung Haji is to administer and manage Malaysian Muslims to go for the Haj. The fund invests in syariah-compliant vehicles with an AUM of RM73bil contributed by nine million depositors.


Kumpulan Wang Persaraan (KWAP) or the Retirement Fund Inc was established in 2007, replacing the Pensions Trust Fund (1991) to assist the Federal Government in funding its pension liability. Funds are raised from contributing employers comprising of statutory bodies, local authorities and agencies to an amount of 17.5% of the basic salary of the employee/ civil servant.

KWAP has an AUM of RM125bil with an average return of 6.5%.


The EPF is a federal statutory body set up in 1991 to manage the compulsory savings and retirement plan for private sector workers in Malaysia. Its predecessor Employees Provident Fund Board was set up in 1951. With a net contribution inflow of RM2bil-RM3bil a month, EPF has become a behemoth savings fund now managing an AUM of RM814bil, with an average return of 5.5 to 6.5%.

The five savings and pension funds now have an approximate total of RM1.3 trillion assets under management.


Khazanah Bhd, incorporated in 1993 as a public limited company, is owned by the Minister of Finance Incorporated (MoF Inc). Khazanah was entrusted to hold and manage the commercial assets of the Government and thus acts as the strategic investment fund of the Government of Malaysia.

With a shareholders fund of RM40bil, Khazanah manages a mark to market AUM of RM157bil.

To finance its investment, Khazanah issues bonds and sukuk which are guaranteed by MoF Inc. As it is able to pay off its debts, the current Finance Minister does not consider Khazanah debts as an off-balance sheet liability of the Government.

Khazanah’s bumiputra empowerment agenda includes initiatives like Teraju, which develops bumiputra entrepreneurs and provides scholarships for the brightest students to study in top universities all over the world.

If compared to Singapore’s two sovereign funds, Temasek (1974), with an AUM of approximately RM800bil, is similar to Khazanah whereas the Government of Singapore Investment Corp (GIC,1981) is similar to EPF as it manages Central Provident Fund (CPF) funds of approximately RM900bil (out of a total AUM of RM 1.2 trillion).

As all of these GLICs are under the purview of the Finance Minister and the Prime Minister’s Office, it will be interesting to see how the Economic Affairs Ministry can play a meaningful role in managing the wealth of the nation. Perhaps we can classify the GLICs into two categories.

The first category should prioritise on the savings funds that look after the welfare of the bumiputras in accordance with the PH manifesto declaration. The Finance Ministry can park PNB, LTAT, LTH and KWSP under the good care of the Economic Affairs Ministry. One must note that these funds do not generate any returns for the Government.

These funds, if well managed, will be effective in redistributing wealth to the mass bumiputra community.

EPF being a savings and pension fund for the private sector should remain under the purview of MoF. Khazanah, which is owned by MoF Inc, is expected to generate returns for its shareholders and thus should remain under the purview of MoF. In addition, Khazanah’s liabilities/borrowings are considered as off balance sheet liabilities of the Government.

To reform these GLICs, both the Finance Minister and the Economic Affairs Minister must work in tandem to ensure that transparent investment policies are set with proper governance structure in place. Perhaps our two senior ministers would like to consider the following reforms.

  • No political appointees to the board or management of the GLICs.
  • Hire the best talent to manage the GLICs.
  • Current reforms on changing the CEOs of GLICs and GLCs should be based on talent and skills of the individual and not on their previous political affiliations.
  • Talented and professional managers like Datuk Shahril Ridza Ridzuan (Oxford/Cambridge) of EPF and Datuk Abdul Rahman (Cambridge) of PNB should be retained as they are our brightest talents with high integrity.
  • GLICs should not be directly involved in the management of the investee companies.
  • Main focus should be on portfolio and risk management, not in supplying half baked and inexperienced CEOs to manage the GLCs. Let the board of directors do their job of finding the right candidate with relevant experience to lead the company.
  • Reduce the number of GLCs especially in non strategic industries by divesting to not more than 20% shareholding of the investee company. Some of the non strategic industries are property development, construction, plantations (Felda the exception), airlines, etc.

From an investment perspective, it does not make sense for PNB to own the biggest property development company in Malaysia with the biggest landbank when there is a massive oversupply of all kinds of properties in a cyclical industry.

If Bank Negara made a ruling that no individual or corporation should own more than 20% of any banks, should it apply to GLICs as well? In the age of budget airlines and free skies, there is no need for a national airline as Khazanah has discovered at great costs.

With the world automotive industry moving towards electric and self driving cars, I wonder what Tun Mahathir has envisaged when he mused about having another national car project?

Malaysia, with its high debts, can ill afford wasteful projects that do not deliver economic benefits to the country.

It is highly recommended that Datuk Seri Amin Ali assemble the best minds to helm the Economic Planning Unit (EPU) to chart a new economic course for this country. This will prevent haphazard and ill advised development projects by individual ministries and wayward finance Ministers.

Just imagine if the High Speed Rail project had been properly evaluated by the EPU with regards to its economic viability. Let’s assume that it brings major economic benefits, Azmin will then consult with saudara Guan Eng whether MoF can afford to pay for it.

Again assuming that MoF can find the money, then the Transport Minister will be tasked with the responsibility of negotiating with his Singapore counterpart and when both sides are in agreement, our Transport Minister will conduct open and transparent tender and then tasked to implement the project. If we had followed this protocol, we will not be in the mess that we are experiencing now.1

Managing Petronas is a no brainer. Just appoint Tan Sri Mohd Hassan Marican as the chairman of Petronas if he is willing to forego his lucrative employment contract with Temasek. Appeal to his sense of national service and it might just work.

Just like Guan Eng, you might discover that managing national assets and national budgets are a major step up when compared with managing a state like Selangor or Penang. Have no fear. The trick in excellent management is to appoint the smartest people in town to work for you. That might just be your toughest assignment in managing the economic affairs of the nation.

Published: https://www.thestar.com.my/business/business-news/2018/06/19/my-wishlist-to-economic-affairs-minister/

9/2018 – Not possible to revamp public sector in 100 days

In just a matter of three weeks, the new Pakatan Harapan government has made many major decisions at breathtaking speed which has left many citizens breathless in amazement.

While many decisions might look like populist strategies by a new government in its haste to fulfil its election manifesto, management students like me can draw parallels as to how to manage a large corporation embroiled in financial difficulties.

At the end of the first 100 days, we would be able to assess whether this new management team has got its overall strategies pointing in the right direction or this nation is left with a trail of disconnected strategies hastily conceived by a motley crew of novice political management trainees.

Corporate managers and SME owners have much to learn from this historical case study as it unfolds.

Fact. The government is the biggest corporation and the biggest employer in this country.

With revenues in the hundreds of billions and expenses always more than its revenue, its biggest management headache is always about balancing its budgets. The government can manage continuous deficit budgets because it controls its own bank which is allowed to print money whenever there is a cash flow deficit.

However there is a limit to borrowings to finance deficits as the government like a corporation has to be able to service its debts. Prudent financial management of the national balance sheet dictates that borrowings should not be more than 55% of GDP of this nation.

One of the major reasons on failures of large corporations and SMEs alike is over-borrowing. Short-term borrowings to finance long-term projects. Financing loss-making diversification activities from borrowings instead of profits from core business. The key consideration to additional borrowings must be based on the organisation’s ability to have sustainable forward cash flow to pay for its expenses and to service its debt repayment. Any capable chief financial officer (CFO) would be able to advise you on this basic accounting concept.

SME owners who also act as the CFO of their own companies are advised to adopt a prudent financial policy on borrowings. It will get even more messy if you include your personal borrowings with your company borrowings if the cash flow from your company is your only source to service both debts. There are so many instances of SME owners with a profitable business getting into cash flow problems when they over-invest into properties etc.

Fact. Rescue operations requires emergency life saving affirmative actions.

Once a patient is wheeled into an emergency ward, the medical officer has to immediately assess the overall health of the patient, diagnose the problems and implement corrective medical actions. Our good doctor, Tun Dr Mahathir Mohamad has recommended surgery, amputations where necessary, prescribed sour medicines and gave oxygen to the patient. Once the condition of the patient is stabilised, he will be wheeled into the ICU or general ward depending on how he respond to emergency treatments.

Many corporate recovery managers are actually financial doctors and they will be able to identify with Dr Mahathir in this case. It is also common practice that new CEOs/CFOs who have been brought into financially distressed corporations will resort to “kitchen sinking” – announcing all the bad news at one go, blaming all the covered up problems on the previous management. If the previous management team is found to have mismanaged with financial irregularities, they can be charged in court. If found to be poor managers, they will be labelled as stupid and incompetent.

For SME owners, you will have no such problem. If you mismanaged your company, nobody will help you and nobody will call you names. You will be declared a bankrupt and you will quietly slide into oblivion. No room for mistakes and no time for self pity. You are on your own.

Fact. Small companies, small problems. Big corporations, massive problems.

Just imagine you have been hired as part of the new management team to manage a corporation called Malaysia. Staff strength 1.6 million employees, 25 department heads, 25 different businesses, some revenue driven, mostly cost centres. Staff morale is low as job uncertainty weighs on their mind. Loyalty to old management team still high but prospects of side income not the same as before. Difficult to change old habits and lackadaisical attitudes. What should you do?

One department has 550,000 teachers on its payroll. With a student population of about five million, these teachers will have to adapt to smaller teaching classes and new teaching methods.

It will be more difficult to improve the teaching of English to students if the teachers themselves do not speak much English. Should the fake facts in history books be replaced with true facts and teaching of religion be restricted to respective religious schools? As the department head of education, what should you do?

Another department has a staff strength of 100,000 officers to uphold the rule of law. Some heads act above the law, some act like the law but more perplexing is that different laws apply to different persons. Cutting off rotten heads might stop the rut but only when no one is above the law, rules become rules then only the law will again be true and fair. In all fairness, what can you do?

So many departments, so many problems. Some problems are big and difficult, some are teething and irritating. So many staff, some are bad, many are good. As they say, one rotten apple spoils the whole basket. How do we sieve out the good from the bad?

It would be much easier to solve the financial problems than the people problems. Ask any CEOs, CFOs and human resource directors. Numbers can be crunched and analysed. To change attitudes and cultural habits, it will need a massive transformation of mind sets across the whole organisation. Definitely not achievable within a 100 days.

As Lao Tzu said, “A journey of a thousand miles begins with a single step.” Let us all walk together in this journey for a better and more prosperous Malaysia.

Published: https://www.thestar.com.my/business/business-news/2018/06/02/not-possible-to-revamp-public-sector-in-100-days/

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