The coronavirus epidermic in China presents an opportunity for entrepreneurs to retool themselves and prepare for the growth that lies ahead when the outbreak subsides. “Reflect on what you really want, what you have and what you need to give up, or stick to,” Ma said.
Ma told students to “learn digital working methods” and “adopt internet technology.”
Alibaba launched its Taobao online shopping platform in 2003 when China was locked down during a nationwide outbreak of Sars.
Ma also channelled Kyocera Corporation’s founder Kazuo Inamori, whose management and leadership turned the television component maker into one of Japan’s largest companies.
Inamori had five strategies for companies during times of recession, according to Ma:
Strategy One: Every employees should turn to sales
Every employee should turn to sales, to arouse latent demand among clients, Ma cited Inamori in saying. "Even in a company with tip-top technology, selling a product is still the foundation of the company's operation," Inamori said. "It is impossible to get orders during recessions if employees lack the spirit in making all-out efforts for clients."
Strategy Two: Spare no effort to develop new products
A recession is a golden opportunity for companies to innovate and expand sales. "Clients are too free during a recession. They will also propose new ideas after listening to yours. This would create orders that you never imagined before, so that you can expand your business."
Strategy Three: Radical cost cuts
Recession is the only chance to cut costs, as every employee would strive to make it happen, Inamori said. "You need to lower the break-even point of the whole company by making efforts to reduce production costs," Inamori said. "If a company can maintain profitability when the turnover is halved, it would be even more profitable when sales returns to normal."
Strategy Four: Maintain high production rate Companies should maintain their usual high productivity rate even in times of recession, by reassigning excess labour from the production line to other tasks to maintain the cadence and vibe of the work cycle. "Once productivity drops, it would not be easy to restore," Inamori said.
Strategy Five: Establish favourable interpersonal relations
"The most important thing for managing a company is the relationship between the manager and employees," Inamori said, adding that employers must "love and protect" employees, while employees need to understand the manager, they need to help and support each other.
Read more here.
Deloitte just published a large-scale survey of Millennial employees (and 1,844 Gen-Z workers) that revealed critical gaps in skill development.
In the study, respondents listed job skills they felt were essential and how well they felt their employer fared in helping them develop those skills.
Here's where the four biggest gaps are, and how to start closing them:
1. Interpersonal skills
2. Confidence and motivation
3. Critical thinking
4. Innovation and creativity
So help close these skill gaps and maybe you'll stop-gap the outflow of young talent.
Anyone questioning whether financial markets are in a bubble should consider what we witnessed in 2017:
Extracts from The Bonfire Burns On
The "Cloud First" Strategy will be introduced to the Malaysian national agenda, starting with the public sector, as it is fundamental to an organisation's digital transformation, said Prime Minister Datuk Seri Najib Tun Razak.
He said cloud adoption would enable the government to rapidly deliver innovative public sector services without incurring a high level of capital expenditure to invest in Information Technology (IT) infrastructures such as data centres, servers and storage.
"This enables the government to allocate resources for more impactful programmes for the rakyat.
"With this strategy in place, it is without doubt that the government is taking the lead in embracing digital transformation," he said after chairing the 29th MSC Malaysia Implementation Council Meeting at Perdana Putra, here today.
Najib said the government could also facilitate the adoption of cloud by the private sector.
In the case of regulated industries such as the banking and financial services, healthcare and telecommunications, he said, the regulators were encouraged to accelerate the publishing of progressive guidelines for companies in these sectors to reap the benefits of cloud whilst maintaining compliance to regulations.
Najib said the government would also develop a National Artificial Intelligence (Al) Framework, an expansion of the National Big Data Analytics (BDA) Framework, which will be led by the Malaysia Digital Economy Corporation (MDeC).
He said in a hyper connected world, it was becoming abundantly clear that AI was the defining force of the fourth industrial revolution. "AI could well be a "game changer" in improving the lives of Malaysians," he said.
On a wider industry-level, Najib said the government would establish the Digital Transformation Acceleration Programme (D-TAP) for large and mid-tier companies which contribute 63.4% of the Gross Domestic Product (GDP), to accelerate digital adoption.
He said Malaysia's industries were still far from being digitally ready and the challenges noted included lack of structured approach, budget limitations, shortage of digital workers as well as the perception that digital transformation was too "fast paced and complex".
To accelerate the transformation, he said, the government would appoint Digital Transformation Labs to provide consultancy and assist in prototyping new digital products and services. "The labs will then match participant companies to digital companies.
"This outcome driven programme intends to achieve three main outcomes from increased productivity, reduction in foreign labour dependency as well as create a new business model or source of growth for the participant companies," he said.
Najib said 2017 was the year of the Internet Economy for Malaysia with the next milestone being the launching of the first Digital Free Trade Zone outside China on Nov 3, 2017.
Aeon Vietnam is planning to open 500 grocery stores across the nation by 2025.
It is part of a strategy by the Japanese supermarket group to open small stores in emerging Asian markets, also including Cambodia and Myanmar, the Nikkei Asian Review says.
The plan is to boost its stores in Vietnam almost ninefold to 500, and has teamed up with two local chains for the expansion. It has held a 30 per cent stake in Hanoi-based supermarket chain Fivimart and 49 per cent of Ho Chi Minh City-based Citimart, since early 2015.
As well as providing its Top Value products for the two partners, Aeon is co-operating with them to promote those products as well as consolidate and expand distribution.
Meanwhile, Aeon has partnered with Japan’s Sojitz Corporation to develop Ministop convenience stores throughout Vietnam. The two firms aim to raise the number of their joint outlets to 800 in the next eight years.
Aeon has four shopping malls, in Binh Duong, Hanoi and Ho Chi Minh City, and plans to build another in the capital plus one in Haiphong in the short run. It aims to have 20 malls across Vietnam by 2020.
Aeon Vietnam early this year launched an e-commerce website offering such products as cosmetics, furniture, electronics, household appliances, bicycles and stationery.
Check out this movie to have a glimpse of Wall Street. From Academy Award winning director Martin Scorsese comes The Wolf of Wall Street, starring Leonardo DiCaprio.
Money, sex, power, corruption, lavish lifestyle ...
The crash of September 2008 brought the largest bankruptcies in world history, pushing more than 30 million people into unemployment and bringing many countries to the edge of insolvency. Wall Street turned back the clock to 1929.
But how did it all go so wrong?
Lack of government regulation; easy lending in the US housing market meant anyone could qualify for a home loan with no government regulations in place. Also, London was competing with New York as the banking capital of the world. Gordon Brown, the British finance minister at the time, introduced 'light touch regulation' - giving bankers a free hand in the marketplace.
All this, and with key players making the wrong financial decisions, saw the world's biggest financial collapse.
What will happen in 2014 and beyond?
Let's start with the definition:
"When the prices of assets (physical or financial assets) rise so sharply and at such a sustained rate that they exceed valuations justified by fundamentals, making a sudden collapse likely - at which point the bubble bursts"
Is there an asset bubble building up in Malaysia? It is not a bubble until it is officially denied.
Managing a business is full of uncertainty. At times, things may not go according to plan and this will cause numerous problems and challenges to the management. This includes enormous pressure on profitability, growth and restricted opportunities to do business. If the problems persist, it will also cause the company to struggle in servicing its bank loans and eventual collapse of the company.
Under a potential default situation, it is critical for the management to understand and be aware of the basic framework of restructuring banking credit facilities. The potential default situation has necessitated the management to be alert and have access to comprehensive information regarding all aspects of loan restructuring.
With this in mind, this article is primarily aimed at assisting and supporting borrowers in restructuring banking credit facilities. It will introduce some effective strategies in restructuring credit facilities. It will also illustrate the framework of loan restructuring that includes the bank’s internal restructuring procedures, how to prepare loan restructuring proposal and the features of rehabilitation fund.
Insights of Bank’s Internal Restructuring Procedures
In general, banks prefer to restructure bad loans as it offers better recovery rates when the bad loan becomes a performing loan again. In other words, borrower with a “viable” bad loan is usually given the opportunity to restructure the loan in accordance to the bank’s internal restructuring guidelines and procedures.
Different banks may have different attitude towards restructuring bad loan, ranging from highly aggressive and super efficient to greatly generous and pathetically slow. Obviously, to the borrower, the later type of attitude is preferred. This, unfortunately, is no longer a choice to the borrower when the loan has already turned bad.
Whilst different banks have different attitude, their loan restructuring procedures are rather similar. Upon default in payment, the remedial actions that will be taken by the bank include demanding for the following (usually in the following order):
a. Recall the facility immediately
b. Reduce the loan amount gradually (by requesting for accelerated repayment)
c. Request for collateral/additional collateral and/or guarantee (including debenture)
d. Increase the interest rate (in addition to the penalty interest)
e. Impose additional covenants to “tighten” the terms and conditions
If the borrower is able to meet the bank’s demand, then the loan will proceed as normal. However, if the borrower is unable to meet any of the above demand made by the bank, then the bank is left with the following choices:
a. Restructure the loan (i.e. sit down and negotiate)
b. Commence legal action to recover the loan (i.e. refuse to negotiate)
Read Part 2 here.
Analysts in investment banks and stockbroking companies have some of the toughest jobs. They have to say something about the stocks, market and economy almost on daily basis - even though there is nothing to say. When market is up, they need a reason to justify it and when market is down, they need to say why. The market consists of many buyers and sellers. It is perfectly normal for it to go up and down, without any particular reasons.
Analysts have perfected the art of talking nonsense or talking without really talking. Here are some examples:
Nonsense #1: Trading in a range
Meaning: The stock market has not moved at all and they need something that sounds interesting to say
Nonsense#2: The market is likely to go either way
Meaning: The analysts have absolutely no idea where is market is moving, so bet on both sides
Nonsense#3: The market is in the process of bottoming out
Meaning: The market is going down but the analysts have no idea how low is low or how long it takes
Nonsense#4: We are cautiously optimistic
Meaning: Again, the analysts is betting on both sides - cautious and optimistic. Either way, they are right
Nonsense#5: Macro volatility
Meaning: The market is uncertain but this phrase sounds smarter
Born in July 100 years ago, Milton Friedman was one of the most outspoken economists who supported free market economic system with minimal government intervention. His famous quote: "if you put the federal government in charge of the Sahara Desert, in 5 years, there'd be a shortage of sand" clearly summed up his view "against government intervention".
Friedman won the Nobel Prize in Economics in 1976 "for his achievements in the fields of consumption analysis, monetary history and theory and for his demonstration of the complexity of stabilization policy".
He was an economic adviser to US President Ronald Reagan. The four pillars of Reagan's economic policy were to reduce the growth of government spending, reduce income tax and capital gains tax, reduce government regulation of economy and control money supply to reduce inflation.
To celebrate what would have been a century of Milton Friedman, here are some of Friedman's best quotes:
If you are an employee, hold on to your job. Now is not the time to play "dare or truth" with your boss. Try to supplement your income with a second job or earn some passive income. If you are the boss, conserve as much cash as possible. In all crisis, there are opportunities - only for those with cash.
These are some selected headlines in 2012:
Sharp considering cutting 5000 jobs worldwide
Goldman Sachs Leads Foreign Banks Accelerating Job Cuts in Japan
PepsiCo announces 8700 job cuts
Alcatel-Lucent to Cut 5000 Jobs After Reporting Loss
Deutsche Bank to Cut 1900 Jobs as Part of Savings Plan
Pharma & Biotech Job Cuts Mount in 2012
Hewlett-Packard to cut 27000 jobs
Nokia to Cut 10000 Jobs as Elop Tries to Stanch Losses
Cisco to cut about 1300 jobs
2000 jobs cut at Queensland Department of Transport
Malaysia is one of the most vulnerable Asian economies should a “perfect storm” of a disorderly debt default in Europe, a slowdown in China and the US, and rising tensions in the Middle East materialise, Roubini Global Economics (RGE) has said in a recent report.
Nouriel Roubini, who predicted the collapse of the US housing market and the 2008 global financial crisis, said that Malaysia had the highest exposure to a pullout of capital as its eurozone and US bank claims amount to more than 25 per cent of GDP. Malaysia's domestic debt almost doubled in the space of less than 5 years, from RM247 billion in 2007 to an estimated RM421 billion in 2011, far outpacing its revenues which only grew 31% or from RM140 billion to RM183 billion during the same period.
Signs of trouble ahead. Let's see if Bank Negara will act decisively by reducing interest rate instead merely stating "we are monitoring the situation closely".
In Malaysia, house prices are at all-time high. Shares are artificially manipulated to be expensive. Market is uncertain due to the global financial crisis. Where to invest your money? The best bet is actually investing in farmland. Better still, buy tractors and learn farming.
For RM350,000 (USD100,000), you can only buy a smallish apartment measuring 700 square feet. With the same amount, you can buy a farmland measuring 2 to 3 acres (depending on location). 1 acre is almost 43,000 square feet!
According to Jim Rogers, over the next 20 years, farmers and agricultural investors will be the ones driving Lamborghinis, not bankers. What will bankers drive? Taxis.
China has again unexpectedly cut interest rate today, twice in a month. Deposit and lending rates are reduced to 3% and 6% respectively. Yesterday, ECB cut its deposit rate to record low, exactly ZERO! BOE just printed another GBP50 billion to "stimulate" the economy. 3 central banks acting in concert? Reuters has the news.
What about Malaysia? Bank Negara says "... there continues to be considerable uncertainties in the global economic and financial environment" but rate is maintained at 3%. The music is still on, let's continue dancing.
Strictly speaking, things are not getting expensive. It is the value of money that is getting smaller. The economists call this inflation - same amount of money gets you fewer things. Why? Ask Bernanke (hint: watch out for QE3 or whatever name, expected in end July 2012). PS: Bank of England did it again today.
China has unexpectedly cut interest rate by 25 basis points, possibly to avoid a sharp slowdown feared by many in the market. US has not recovered and Europe is already in recession. The world economy still does not look good since the 2008 global financial crisis. The solutions seems to be printing more money by central banks around the world (calling it under various "policy" such as stimulus plan, quantitative easing etc).
US is expected to print more money soon (ie. QE3). Will the Malaysian government do the same and lead to many "unintended consequences"? Plan for the best and prepare for the worst.
Here is the latest on global economy by Mohamed El-Erian, Co-CIO of PIMCO, a global fund manager which manages more than USD1.8 trillion assets.
I attended a conference on Global Challenges, Local Opportunities organised by Institute of Bankers Malaysia (IBBM) in Kuala Lumpur on 8 - 9 May 2012. The topics presented are global economic crisis, risk management and banking. The keynote address was presented by Graeme Maxton, a thought leader, writer and economist.
Maxton's latest book "The End of Progress - how modern economics has failed us" is a must read if you want to know who is to blame for the current global crisis. What is wrong with the western (US and Europe) economic model and why Asian countries including China, Korea, Singapore and Malaysia enjoy strong economic growth.
You should relate some of the economic lessons to the management of your business. The purpose of an economy is not growth = the purpose of a business is NOT profit. Think about it ...
Business, economy, education and current issues. Providing tips, tricks and tools in managing business.