Friday 22 August 2008

Permatang Pauh - Battle of Reality

I cannot see how BN can take away Permatang Pauh from PKR.

There is no credibility in the BN people :

The latest fiasco is today's petrol price reduction. How can the Minister says one thing on one day, and then hey presto, he contradicts himself the next day. "No, we will not reduce petrol price before the Permatang Pauh by-election just to get the rakyat's votes, it will still be on 1st Sep 08". Come on, this is not the first time, our dear Minister has contradicted himself.

Then poor Lee Chong Wei has to be flown specially all the way down to Permatang Pauh from KL just to get the RM300,000 incentive promised for the Silver medal in the 08 Olympic. Why now? Why not in KL since he is staying there? I would not object if he has got it in Berapit, Bukit Mertajam, his kampong. At least, the Penang Government did the right thing by saying that Lee will get his Datukship after the by-election....hmm, not bad. Announce now & get it later.

Then it's the 8.5% inflation rate just announced by the Statistical Dept, up from 1% in June 08 and by 7.5% since then. If our dear Minister has got his economics correct, he will know that this figure is not going to come down anytime sooner. I know for once, that a certain amount of subsidies must be required for some neccessity items ( I remember learning it in the Economic lessons during my schooldays 35 years ago). Doesn't the Minister know that the huge leap in petrol price increase has caused a knee-jerk reaction resulting in practically consumer goods price increases in practically everything? There's opportunity in these price increases and everybody were jumping into the band-wagon for free, like nobody's business. There's no way, consumer prices are going to come down...ask our friendly hawker friends la. We will have to live with it. Ever wonder why prices are so high in Japan, USA and the likes? At least, they are living in the first world.



Permatang Pauh. My vote goes to PKR. It's a vote against the high inflation rate. It's also a vote against the credibility of the BN actions.

Friday 6 June 2008

Come on Datuk, whose legs are you pulling?

The latest petrol hike has been coming for a long time. With all the buzzing activities and buttering-up statements from the various ministers, one would have not been surprised at the price hike announcement. However, the timing is damn lousy and unprofessional-like!
One moment foreign cars at the borders were banned from filling up and then after a few days ( 2 days?), the ban was lifted. What a joke..one would only have to listen to what the Singaporeans have to say and you will get what I mean.
Then we got to hear our very own Domestic Trade and Consumer Affairs Minister, Datuk Shahrir Abd Samad saying there will be no price hike, at least until August 08. A few days later, after the hike, this is what the same guy has to say, "..I have confidence that it's not going to go up...". Come on, my dear Minister, whose legs are you pulling? At least tell us you were left out in the information stream by your boss, but then politicians seldom admit so. Where do they hide their faces then?
And then the Govt has the cheek to compare our price with neigbouring Singapore and Thailand! Why not compare with the Gulf States ( gas price from RM0.38 to RM1.19 per litre), Iran (RM0.35 per litre), Nigeria (RM0.32 per litre) or Venezuela (RM0.16 per litre)!! After all, we are a net oil exporting country too.
Come August, what's your bet?

I wonder whether the friendly Hokkien mee guy down the corner will reduce the bowl of mee when petrol price goes down one day?

Wednesday 21 May 2008

Blinded to reduce expenses----Penny Wise Pound Foolish

In the mad craze to cut cost, it is never wise to reduce overhead expenses unnecesarrily. Have you ever heard of the maxim,'Penny Wise & Pound Foolish'? - Save on the minor & chicken feed expenses & spend extravagantly or waste on foolish and idiotic projects.
Penny Wise
How much does saving on photstat papers, delaying intake of key personnels, switching off lightings, etc contribute to overall expenses reduction?
Pound Foolish
And how much does re-doing of entire office due to faulty design or materials used, and how much does flying in a bunch of technicians from overseas to repair machineries , contribute to overall expenses reduction?

Sometime increasing the expenses works the reverse-you actually increase your profit, which is why you wanted to reduce expenses in the first place!

See this link.
http://www.globeinvestor.com/servlet/WireFeedRedirect?cf=GlobeInvestor/config&vg=BigAdVariableGenerator&date=20061214&archive=cnw&slug=C7264
Dectron announced a 3rd qtr increase of gross profit margin YOY despite a huge increase of administrative & selling expenses due to higher shipping / freight cost & rising depreciation / amortising deferred costs. Revenue for 1st 9 months up USD6.3million or 17.6% YOY, the growth attributed to doubling sales & cost reduction effort.

Read my lips........reducing expenses is not the same as reducing costs, although you may need to reduce expenses to reduce costs. Huh? Forget about what I have just said. Some people never learn.
Increase productivity by all means. You will get more for the same, which means you don't reduce expenses but still get higher revenue ( & thus higher profit, hopefully.....unless the finance people have bungled in their costing!)
Reduce direct materials cost. Localise your direct materials if cheaper. Or if you cannot ( 'cos materials cost keep rising these days!!), increase your selling price & sell more. More is more. More is more profit.

So if you reduce expenses by RM10,000 per month and gross profit is still in the red, compared to you increase expenses by RM50,000 per month and revenue / gross profit increase two-fold, which is better? You don't need a seven-year-old to teach you simple arithmetic, do you?

Increasing your profit in lieu of reducing your expenses, which seems convincing? Examples: if you don't have sufficient people to sell your products, or if don't have sufficient stocks to make your products, or if don't have sufficient products to sell (??) ........enough said.

If you still don't get it, get your head check again!!

Monday 31 March 2008

Is P-D-C-A outmoded?

I first heard of the PDCA cycle 25 years ago.

I have not heard of it for at least 6 years, until recently when a funny thing happened & any grandfather would tell you they suck eggs better than you...for one thing, any grandfather would tell you they have lost their wisdom teeth a long time ago, while yours are just starting to grow.

If anybody tells you the basis of the PDCA cycle is continuous improvement, i.e." improvement without interruption", then whatever you do now may have become outmoded if you have not changed recently.

Has the PDCA cycle itself changed or improved since 25 years ago?

Continuous improvement will create a "change fatigue"....you would become disillusioned, disenchanted & confused, you might even stop following the changes altogether.

I think there are three factors to perform a mission:-
1. PEOPLE
2. PROCESS
3. PRODUCT

If people are not motivated, will change or improvement occur?

Definitely, change requires people, process & product. If people are not a company's asset, then why PDCA? Why not CACES..Come Act Cheque Eat Sleep? If people are a company's asset, the company must ensure its appreciation , or else they will depreciate & eventually be writtten off as zero-value before the end of their life-cycles.

What Shewart & Deming meant should be continual improvement, i.e. a cycle of improvements with pauses to consolidate the changes. It is then subject to Checking or Study that there is actually an improvement BEFORE the next change or improvement activity be started again.
That's why ISO recognises this & corrected ISO9000 to ISO9004-2000 mentioning specifically "continual improvement".

Don't you think Do & Act are the same? Check your dictionary for their meanings....sometime its just for want of a term. I think ACT should really mean IMPROVE or CORRECT or RECTIFY when failing to achieve the desired results.

Why didn't Deming or Shewart improve PDCA if they are so good?
Does PDCA cycle have to be circular? You were taught so? Is it possible ,just think for a moment, for you to DO something without a Plan but with just a "thought" or"idea"? Have you ever done something sucessfully without a Plan? Think hard...hard....hard...now you are sleeping..you are in slumberland....sleep,sleep,sleep...zzzzzzzzzzzz. SNAP!
I sometime just do the improvement straightaway when I see something different on the spot.

PDCA works on the basis of the Japanese incremental continuous (small) changes. It is no good to make a sudden big change......but this is what the US advocates- a sudden big change to effect an impact on the overall improvement. REFORMASI ! What the Chinese ( PRC) always said ( I heard it a thousand time while in China) - "Kai Ge".

In PDCA, no people are mentioned, people are not a company's asset. It is assumed that people will use and make it happen. What Shewart & Deming did not know was that most people are not motivated or interested in improvement if there are no benefits to be reaped.

In ISO14000, the first three elements are actually the PLAN, followed by the DO until the "monitoring" element when the CHECK starts & ends at ACT at the last element (Mgmt Review). One cannot achieve the ISO14000 status if all elements are not strictly adhered to but can one achieve the desired results without performing the the first three elements?

QCC circles? QCC circles work on the pillar of the PDCA cycle. If a company has active QCC activities 13 years ago, would the PDCA cycle be obsolete now?

Quo vadis? Pension.

Wednesday 26 March 2008

The Ring i System

I first heard of this system more than 30 years ago during my 6-month stay at Suzukashi, Japan. At that time, I do not know the real meaning of the system.


This time around, the Ringi System was put into practice in a multi-national company I know of.


Basically it is a Japanese collective decision making system involving a large number of people.
There are 4 steps involved:

1. *Nemawashi or setting the groundwork
2. The person in charge will first draw up the plan in a written form.
3. It is then send around to the superiors; if another dept is involved, then the consent from there will be needed. "Superiors" refer to all layers of mgmt people & some companies called them **"deliberators"
4. The final decision will be made by the authority of the company, in most cases, the CEO.



** Deliberators :
(i) people who think carefully, often slowly, about a choice to be made.
(ii) people who consults with another or others,usually with the same intellectual thoughts, in a process of reaching a decision, slowly.



The System is supposed to be a bottom-up system ( as opposed to the US top-down system) with the bottom people having no say in the decision. The original Japanese bottom-up system is the method of appreciating the the ideas from the lower rung people who have hands-on experience on the job.


Of course, in Japan the approval is shown by the person's "hanko" - a personalised stamp, with some even registered legally.


Theoretically, if there are objections against the plan, there are two solutions to it:
1. Discussions and the plan is revised if necessary-sometime the PDCA chart is used (huh?)
2. If the revised plan is still not supported, it will be scrapped.



In actual practice, the users of the system in many companies have gone through hell a few time. There are seldom discussions but there are many queries & inquisitions.... heads have rolled under the guillotine since the Spanish have theirs in 1748. Oops! I have strayed too deep into history.

...OK, in actual practice, deliberators try to outdo each others in a war of intellectual wits & wisdom, lest you are seen with lesser job to perform. Deliberators do not see eye to eye.
Try this tongue twister-Deliberators delibrately deliberate. Deliberators in Japanese companies in Japan are usually senior experienced people who have gone through the mills & know their mettles well but sometime deliberators in Malaysian companies are people without plant operational knowledge & answers to their queries often require supernatural use of individual resources from the occult.

* Nemawashi

....a nihongo gardening term meaning to prepare a tree for transplanting by digging around it & cutting some of the roots.

(i) Therefore the planner of the project need to do the groundwork so that a consensus may be reached BEFOREHAND. Groundwork to purchase A4 papers?

(ii) Nemawashi should be done before the plan is drawn up. Again, draw up a plan to purchase A4 papers?

(iii) Conducting "nemawashi" effectively through formal & informal meetings is the key to success. Maybe someone may want to suggest A5 papers for the printers or faxes.

BENEFITS

1. It's a safe way to make decision--people express their opinions & many people review the plan.

2. People have feelings of participation ( sounds familiar) -so that it is Plain Jane sailing to implement the plan

3. Gives younger employees an opportunity to be the originator of the plan - and thus make them more interested in the company ( why is it that the reverse seems to be happening in some companies?)

DISADVANTAGES

1. Takes a long long time to reach a decision. Wait till the cow comes home.

2. Responsibilities tend to be diffused because no one accept liability if the plan fail.

3. Vendors feel frustrated. Business partners feel frustrated. The originator feels frustrated(?).

There, this is the Ringi System.

Hey, what plan are you talking about? Project plan? Business plan? Production plan? My friends have to use the Ringi forms to apply for simple project plan to re-purchase A4 papers, to purchase a key from the locksmith, to service the company vehicle....I wonder whether they actually sit down to discuss what, which, where,when, why and how ( hey, that's 5W & 1 H man)to buy the key?

Of course, using the Ringi System for big project plan like designing an office would work extremely well to cut off cronyism. Talking about cronyism, a funny thing happen on my way to work this morning.......................aw, that's another story.


Thursday 20 March 2008

e-Kastam - Blue Ocean Strategy or Increasing Consumers' burden?

Everybody has heard of e-Custom or e-Kastam whatever it is. But do you know the total impact to your company? The Custom Dept wanted to adopt a Blue Ocean Strategy (www.blueoceanstrategy.com) by going into uncharted water & at the same time wanted to snuff everybody out via a monopoly arrangement.


In Malaysia, the system is known as "SMK-Dagang Net", just figure out what SMK means. It's Malaysia's e-trade facilitation service and Dagang Net operate this exclusive electronic linkage to the Royal Customs Dept on matters involving import & export declaration & clearance.


Haulers & freight-forwarders were aptly well informed ahead with Port Klang first on trial before extending the system to Penang Port. Importers & exporters (companies) were caught off guard by the rip-off in the new charges incurred and trading partners were forced on-line to extend the value of this network.


Freight forwarders "complained" it was compulsory to use the system & manual submission of the Custom forms were not acceptable. Of course, the obvious objective was to improve cycle time to generate & process shipping information required to move products through Customs clearance processes by using automated standard Custom Documentation Format.


The arbitrary charging system were readily accepted by the haulers & freight forwarders alike. After all, who bears the final brunt of this extra amount? - the shippers. Some shippers, in order to maintain the competitiveness of their products, absorbed the cost with a resultant lower profit margin while some others passed the extra cost to the consumers.


This is one of the causes of rising product costs that we hear so rampant of. The country further ( Malaysian vendors are famous for passing the costs to buyers at the slightest opportunity!) loses its competitiveness compared with neigbouring countries as well as to the far east countries.


Electronic systems are supposed to improve productivity with minimal operating cost after the initial cost outlay, but one wonders who ultimately prosper in this case.


Just think for a moment:
The fee for clearing a set of Custom form from the old manual system - RM5.
The new electronic fee for the same set - RM30.

One wonders why each form can only accomodate 5 items? The total cost would have been reduced tremendously if the form could accomodate 10 items or more. Only the Custom Dept can answer that.


For your info, the Dagang network handles about RM1.8billion worth of Custom duties payments annually from more than 2000 corporate customers.

As far as the consignees are concerned, there are no change in productivity: if it has taken 5 days to clear an LCL shipment in the past, it is still 5 days now. But consignees may be a few hundred ringgit poorer. If there has been 10 sheets of Custom forms to be physically handled & be filed up in the past, it is still so now. E-Custom is not a paperless system, at least for the shippers.

Nothing has changed. Except, one may be a few thousand ringgit poorer every month. If any shippers is expecting a reduction in the fees ( after all, the initial financial outlay of introducing the system would have been returned by now) , I don't see any coming in the immediate future.

MEF? FMM ?................zzzzz

Monday 17 March 2008

Finally, the Perak MB has been sworned into office.

This augurs well for our country.......aw.. yeap.. oh well, it's just the beginning.

One thing that surprises me though is that despite all the pre-sworning hoohaha, the previous "opposition" managed to quell public sentiment & sarcasm ( & at least one from a previous Minister) about how the new Government is going to operate when they cannot agree on the MB's position when there are just three coalition partners, compared with BN's 14.

LKS apologised to the Pemangku Raja Perak, Raja Dr Nazrin Shah & even got an audience with Raja Dr Nazrin. Incidently, Penangites should be proud to know that Raja Dr Nazrin was born in Penang. Anyway, have you read any news about apologies from any BN's Ministers or the power that have been? This is the denial syndrome everybody have been talking about.

Coming back to the power sharing formula of the new coalition Government in Perak. According to the proportionate representation of state assemblyman elected, the State Exco should have been allocated accordingly as DAP 6, PKR 2 & PAS 2. But DAP wanted 8-1-1 & PKR threatened to pull out of the coalition. It was finally agreed at 6-3-1, excluding the MB who hails from PAS. Now this is what I call power sharing......the majority partner didn't insist on their take & even apologised on earlier outburst.

(Of course PKR's President earlier assertion that the Exco ratio should be based on Perak's population is pure poppycock : that would then be back to square one- racial politics, which the voters didn't wanted. That's why the DAP-PKR & PKR-PAS pact worked so well this time. It transient racial barriers)

Now, what about the BN-led states? At the time of writing, the Perlis MB has not been sworned in yet but it seems Shahidan has thrown the white towel & the Bintong Assemblyman is set to be the new MB, much to the chagrin of our PM. I always wonder in this circumstances : what happens if the PM insisted on his nominated MB & then the 9 UMNO Assemblymen defect to form a pact .......will these guys form the new Govt in Perlis, since they form the majority? Tssk..will this ever happen in Malaysia? I shudder to think of it.
..........but one thing for sure. PKR's waiting to welcome these YBs, no bribery, as Anwar has said.

Trengganu? The show ain't over yet, even though the 22 Asssemblymen have pledged their support for the PM.

Who says three party-coalition cannot decides effectively compare with a one-party no coalition?

Wednesday 12 March 2008

MB poser in Perak

The latest fiasco by the DAP may yet be another sandiwara but it did not go well with the royalty. However, Lim Kit Siang has since apologised over his outburst, see link below,

http://www.thestar.com.my/election/story.asp?file=/2008/3/13/election2008/20080313104151&sec=election2008

and the swearing in ceremony will go full steam ahead.

Actually, it's all ado for nothing. With another 50% of population in Perak being Malays, it is natural for the MB to be a Malay. What's the function of the MB you may ask? Well, he meets the Sultan regularly for report updates for one. This is one job a Malay MB will do well.

After all, the 10 Exco will definitely consist of DAP 6, PKR 2 & PAS 2 members in the appropriate ratio of Assemblymen representation. With 60% in the Exec Council, DAP will still be the reckoning power to be.

It would have been better to get on with Mohd Nizar Jamaluddin of Pasir Panjang as MB but the DAP maestro has to show their supporters that the DAP is no easy pushover. He got his point.

Now let's start the real thing going.

Saturday 1 March 2008

Penang, re-inventing

SIX more day to D-Day for Penang. General Election. The time when the unthinkables & the impossibles happen.

Suddenly, you see newly surfaced roads cropping up everywhere; potholes being filled, even pin holes; a phone call to the BN service centres & presto, the garbages were cleared & clogged drains were clean inside out ; Ministers opening functions at short notices, even some of TAR College's Diplomas were recognised now by the Govt when in the past no one cares two hoots for this issue,etc etc.

This time around though, the Police seems to be very accomodating if you look at the numbers of ceramahs conducted throughout Penang. Talks by Anwar & Kit Siang are always attended by curious rakyat overflowing the brims of the venues. Of course, the size of the crowds reflect one's popularity but will never be the yardstick to gauge one's election result.

Interestingly, Penang, Terengganu & Kelantan will again be the states to watch out for. Kedah may spring a surprise.

Penang:
There is no such thing as a clear winner. swings had occured a few times before. Look at the DAP in the last Election...total wipe- out at the state levels. It would be a pity if hardworking people , like Tan Cheng Liang, Lau Chiek Tuan are not re-elected, but the voters sentiments, fanned by the oil price hikes, higher costs of living, unequal job & educational opportunities, HINDRAF issues, etc may see shocking exits for many incumbents as voters go for a change, a daring change to re-invent, as mouthpieced ( & may backlash) by one of the BN component parties.

Certainly, whether the BN announces the name of potential CM of Penang or not is a moot issue: if the name is not announced, Penangites may not be focused to vote on any particular candidate & votes will split; if either Teng CY's or Teng HN's name is announced & preferred over the other, one of them may be toppled as voters make up their mind to assure only the chosen one is elected to be the CM.

Batu Kawan may be a safe haven but with more than 60% non-Malays in this Parliamentary seat, the swing may just yet prove to be fatal & the swan song for Koh.

The PRAI seat is forgone. DAP will wrest the seat back after 3 terms from the MIC due the non appearance of the incumbent in Prai for the last 2 terms, a certain Raja....

Bagan will swing to Lim GE, ( potential CM?) and at least 1 of the seats under Bagan may fall to the opposition too, with the incumbent retaining Sg Puyu.

The UMNO held areas may be predictables as they have not been tested in all the past elections. But as the saying goes, the ball is round & anything can happen, especially when PKR seems to be picking up steam speared headed by the presence of their fiery orator Anwar.

I will not be sleeping, come this 8th of March (sounds like Ides of March, et tu Brutus?) but busy filling in the blanks before the official announcements. Funny, but have you realised as in past election results' announcements: if the oppositions win, their names are always announced late? This time around...........