When will the noises (bitching) stop?

“All I and AirAsia have ever tried to do was to make it cheaper for the average man to dream and fly like those with money. One day airports, regulators and politicians will understand,” he said alluding to the controversy over the increase in passenger services charges (PSC) at klia2, which is the main hub for AirAsia.“I’m probably one of the most unpopular men for being outspoken and trying to make flying affordable. But won’t stop till the slogan I came up with in the shower becomes true. ‘Now Everyone Can Fly’. The battle must never stop,” he wrote on his FB page.

How many times have we heard the same scratched record being played. Ironically it's loudest when there is something happening that we are not meant to know, so lets create the smoke screen!  

Now if I want to create a low cost organisation, logic will tell me that there are two costs that I am required to give my attention too, 

A. Cost that are outside my control(external), primarily these are the cost that I incur from my suppliers because I need goods and services. These costs I manage by employing frameworks like Supply Chain Management, Just in Time, Bulk Buying, Long Term Supply Agreements, Heavy Discounting, etc, etc. But ultimately there is a level beyond which the supplier will say, "Sorry ole chap, I cannot do that as I would be making a loss!"

B. Then there are internal costs, cost that are within my control. Again there are various solutions I could employ to keep a tight reign on the costs. I could employ large scale IT systems to increase productivity, making front line personnel cleaners(never thought about the hygiene situation - one minute cleaning, next serving food) keeping head counts to a minimum, doing fanciful things like hedging and getting rid of the trappings of grandeur.   But this will entail leadership and setting the tone at the top, the very top! That means giving up the Bombardier private jet that in itself incurs a bag load of money. After all why should it not be them using their own product, would not the towkays be great ambassadors for the organisation?  

C. The pass through "financial items(costs)" that organisations are required NOT to incur in their own right but are mere de-facto collection agents of other organisations or the government, like PSC(a consumer tax levied on the passenger), GST(a consumer tax levied on the user of goods and services) or PCB( tax deducted at source for salary I the employee earns). These cost have nothing to do with the organisation and its costs structure. Does anyone remember the times when we went to the airport to check in, at the time of checking in we had to hand over cash for our passenger service tax, there are still countries that employ this method. This has nothing to do with the airlines!

So stop all this noise, concentrate on A and B, if you feel that you are not getting what you pay for, than please go talk to MAHB, don't treat your customers as being less informed. Anyway what happened to the Muhibbah Dinner that the organisation had with MAHB?, I suppose MAHB may once again need to suggest making public the debtors position of its various clients!    

For 2018 I hope towkay remembers that not only ‘Now Everyone Can Fly', but also everyone went to school, can read and rationalise. 

Happy New Year Towkays!

Of Youth, Skills and Relevant Experience.

This is what was contained in the filing with Bursa:

"Neelofa Mohd Noor has been at the helm of NH Prima Sdn Bhd for the last 3 years as its director. Under her leadership, the brand Naelofar Hijab is sold in more than 23 countries including Brunei, Indonesia, Australia, UAE, United Kingdom and Europe. As an actress and TV host, she acted in a number of blockbuster movies and hosted popular TV shows. She had also produced her own reality TV show. Neelofa has a strong presence on social media with more than 5 million followers on Instagram. She has received many local and international awards including being listed as Forbes Asia 30 Under 30 Class 2017, SME 2017 Celebrity Entrepreneur of The Year, MSMW 2017 Social Media Celebrity of The Year and In Trend Malaysia InTrend Gala Night 2017 Most Charming Celebrity of The Year, The Inspiring Woman Award and The Iconic Role Model Award. She has been invited to speak at forums and talks, most notably at the 2017 Forbes Asia Summit in Manila, 2017 UNDP-MiSK in New York and 2017 Forbes Summit in Boston. Many international brands like Lancome, Swarovski and Titan have recognised her achievements thus signing her as their ambassador."

Another public interest entity appointed two directors to replace the top man as he was appealing a 5 year prison sentence and a fine for insider trading, one is a 29 year old female the daughter of the man in hot soup, not much information other than academic qualifications, the other is a 39 year old gent, the nephew, again primary information on academic qualifications and that he has been involved with the company since 2000.

My amusement is how both companies can say ( in the case of both ladies) that these appointments meet the requirement of persons with relevant skills and experience that will contribute to the business of the companies. This is not just a requirement of The Malaysian Code of Corporate Governance 2017, but a requirement of CA 2016 with regards to the application of Duties and Responsibilities of Directors.

Needless to say I am sure there are many valid reasons that are unknown to me, I wonder if it includes *%#@ to the r_g______s ? People sometimes forget that a plc is a different kettle of fish, there are fiduciary responsibilities, oh well,Malaysia Boleh.

At the encouragement of BV!

After lunch and over a cup of tea, BV enquired as to what had become of my blogging. I said I thought no one bothered, his response was that I should continue as there were those that read this blog, at least for amusement. So for BV's and others that indulge, I decided I shall make another attempt. 

What they don't want you to know!

Chinese New Year, in fact all festive occasions, with the exception of Hari Raya, there is such joviality and happiness brought about by that poison, that tongues get loose and many things are divulged, as they say, caution is thrown to the wind.

One of the stories that I heard is of such repercussions that I am wondering how come we have not heard the crumbling  sound of the whole organisation as it comes crashing down.

Now it seems that when ever a berhad (not just listed berhad, but berhads) solicit funds from the public they need to get permission from the Capital Markets Regulator ("CRM"). Apparently there was such a case where the berhad did not get approval, and naturally the CMR took action. Now here is the intrigue,

1. Apparently the case was thrown out, it seems that the judge thought that the law and or facts were incorrectly applied. Larger issue is, is this only referenced to this particular case or does it effect all future solicitation of funds. Can you imagine, the wider net that it could apply too.

2. Apparently it was handled by a junior prosecuting officer, why a case that had the potential for far reaching ramifications was not handled by the Head of the Department needs to be questioned. Maybe the belief is that since they are the CMR, the judiciary will always grant them what they wish!

3. Now this is the more interesting part, that the defending lawyer was a former employee of the CMR and there are rumblings that some sort of pally relationship exist between the former and current prosecuting officers. Apparently a number of former prosecuting officers have gone on to set up their own legal practise and for some reason specialise in CMR's cases.  I wanted to ask more, but I was afraid if I did that I would have alerted them and that would have been the end of the stories.

I am told that there would be an appeal lodged, but what is ironic is that how could it have happened in the first case. It only adds to what I have been saying, the organisation has become totally dysfunctional with no leadership, more time is spent with opening ceremonies, photo taking and overseas trips. The time has come for change!

Maybe Mr. Tan Sri Dato Seri needs to have people that are willing to challenge his decision and instructions rather then having silence, remember Silence does not mean acceptance (read correct), Only God Can Be Correct All the Time!

Calling a Spade a Spade - The Continuing Sime Darby Fiasco - Update

Just a short note, did you guys notice that on Saturday last and today there were rating agencies being negative on the proposal with regards to separately listing the Plantation and Property Group. I hope that PNB is taking note and will do the right thing. What was it that the late President Kennedy said.

you can fool some people all of the time,
you can fool all of the people some of the time,
But you cannot fool all of the people all of the time!

Truly I hope that the new Chairman and CEO of PNB will do the right thing. The right thing takes time, effort and strength and addresses the root cause of the problem.  After all no pain, no gain.

Calling a Spade a Spade - The Continuing Sime Darby Fiasco

So in the late 90s and early 2000s the owners of Sime Darby Berhad started the process of taking public listed entities within the group private. Some suggested that it was to make sure that income flowed totally to the holding without any dilution (by way of minority payments).

Then in the mid 2000s there was the merger with other plantation companies within the PNB group, the saying was that big was beautiful, synergies, economies of scale etc etc etc.

Now since the new Chairman of PNB has come in, its let's re-list property and plantations (I understand the Motor entity was to be included but the numbers are not so good) to unlock value.

Wow within 15 years we are back to another round of list, delist and re-list, (of course the thought did occur to me whether it has equally to do with generating income for the Maybank group).

Now lets be realistic, its time for brutal honesty;

1. Is this really for unlocking value or to hide the fact that the group is a non performing group.

2. Fact remains that the current CEO is a non performing chap, every where he has been too, FELDA, Bank Islam, TH etc etc, he has never enhanced the value, many argue that in fact he left the entity worse off.

3. Reality is that after the Sime/Qatar debacle they have never been able to recover. At that time there was a light weight CEO, he was removed another lightweight was appointed, nothing has changed. Why when almost all the management left/was replaced from the time of the Sime/Qatar but the  CFO still remains puzzles many. Does the CFO not play an important and pivotal part, is the CFO not the check and balance to the CEO, could the CFO not have been more effective then and now, or was the package more alluring that the right thing to do was to be silent and hold on to dear job.

4. Ignoring the fact that the current CEO is really not a toughie, what really happened was Sime went and over geared itself in purchasing NBPOL, and what that means is if you are not an efficient company, eventually you will not be able to meet your obligations.

So Sime was forced to par down its debts by selling prime assets. Lucky for them their PR department was able to sell to the media as a monetisation program.  So now we got this poor performing CEO and lepak CFO being made to look like heros. One must also ask what happened to the much vaunted Risk Management system, they should have spotted red flags.

So cutting the story short, PNB Chairman and CEO, lets face reality, its not a case of unlocking value, its a case of hiding the incompetency of the Board, its CEO, CFO, Risk Management division, oops it looks like maybe the whole group.

You guys don't believe me that the whole system is broken, ask the CEO whether he tried to appoint his buddy as Chief Internal Auditor and when Audit Committee said maybe not, he continued with current one till now, maybe its some new management philosophy!  

So Tan Sri Chairman, to generate real value please put the group right, ring out the inefficiencies and ineffectiveness, it might take some time, you might be surprised that the group will be far more profitable then you imagined.

Maybe to start of you may want to ask why not only the CEO has a BMW 7 series but all his direct reports, why when they travel they travel in entourages etc etc.

Remember nice people do not run performing companies, they run charities! Doing the delist, re-list, delist etc is not addressing the real issues, it only delays the inevitable.
                   

You just simply don't listen! - The AA situation - An Update

Last week there was this long, almost a page,  news report in the financial edge relating to the fact that AAX was quoted in a charge relating to the Rolls Royce ("RR") bribery. The report's opening para said that AA has no relationship or dealings with RR, and claims no knowledge of the matters relating to the USD3.2m graft! All I can say is yes they are correct, AA it would seem has no relationship but sister company AAX did sign to have their A330s powered by RR's Trent engine.

Now we all know that there are two heavyweights (no pun intended) that are instrumental in all major transactions that involve the group. So by saying AA is not involved and stating that there are no relationships with RR is technically correct, we also know that when a statement is made it must be unequivocally clear, especially when it involves a group where management is considered as one by the general public.

Now I believe, in my simple mind, that what AA/AAX should do is to make a very firm denial regarding this matter, appoint a top solicitor and challenge the Serious Fraud Office, after all its reputation is being hung outed and questioned, and I am sure the heavyweights in particular would not want this to happen, especially when they are planning an IPO, or are there reasons that they prefer that remains unknown.

It would additionally be nice if the group would also shed more light regarding the transaction with the Executive jet, yes it was reported that it all went through the Audit Committee, but considering its seriousness it would be good for transparency and it would make interesting reading for the simple mind and demonstrate a high degree Good Corporate Governance.

Considering the seriousness of this matter, I am wondering if Bursa have or will be asking for further clarification! Oh maybe not, since they have this situation of "we have a new CRO, we don't have a new CRO, no no our CRO is still our CRO!

Finally  remember my theory of patterns, there is a single occurrence, then two occurrences, and finally its a way of live..........................people don't fail because they are stupid, they fail when they become arrogant!