Leadership - by Japan Airline CEO

Quah Kok Hwee said:
I attached an article here about the leadership of Japan Airline CEO. 
And I wonder how many leaders in Singapore, I am referring to MPs,
Ministers, Management of Govt Linked firms, do the same as JAL's 
CEO.

CEO of the People, Haruka Nishimatsu of Japan Airline truly brings leadership to a while new level of meaning.

(1) ...his morning commute on the city bus, Haruka Nishimatsu heads into the office and gets busy at his desk with the rest of his Japan Airlines coworkers.

(2) At lunch, he lines up in the cafeteria...

(3) Not exactly the glamorous life you'd expect from the CEO of one of the world's top ten international airlines. Is it so strange, asks Nishimatsu.

(4) ...when JAL slashed jobs and asked older employees to retire early, Nishimatsu cut every single one of his corporate perks, and then for three years running slashed his own pay. In 2007, he made about $90,000 U.S., less than what his pilots earn.

(5) In Japan, says Nishimatsu, there's less of a pay gap between the top and the bottom. "We in Japan learned during the bubble economy that businesses who pursue money first fail. The business world has lost sight of this basic tenet of business ethics." Nishimatsu says his airline has a long, difficult recovery ahead. As far as his pay, he's dug into his savings like the rest of us.

(6) “If management is distant, up in the clouds, people just wait for orders,” Nishimatsu told CBS News through a translator.

(7) “I want my people to think for themselves.” Nishimatsu says a CEO doesn’t motivate by how many millions he makes, but by convincing employees you’re all together in the same boat.

[SOURCE:]
A) http://articles.cnn.com/2008-11-11/living/transcript.wed_1_moral-obligation-unemployment-rate-job-market/3?_s=PM%3ALIVING

http://slumz.boxden.com/f605/mar-29-different-ceo-haruka-nishimatsu-1727190/

C) http://www.youtube.com/watch?v=r8ATOARgLO8 

The Gold Guarantee

Mr. Tan
t is Sunday Times feature of the founder of The founder of Gold Guarantee. Just proves one more what poor disservice The Straits Times does to the public in advertising examples of fake successes bordering on fraud.

The Straits Times
Jan 15, 2012
He plans to give millions to charity
Businessman aims to achieve net worth of $200m and give away 90% of his money

By Joyce Teo 

Business owner Lee Song Teck, 33, is a goal-oriented person who cannot sit still. Just four months ago, he started a gold trading business, and is now preparing to start three more businesses. 

Still, his agenda is not as daunting as it might seem at first sight. 'Over the years, I have learnt to delegate, and to create a system that allows the business to run on its own within a shorter period of three months, instead of two years,' he said.

What spurs him to work hard is his drive to contribute to society.

Eventually, he aims to give away 90 per cent of his wealth to charity. Money does allow you to enjoy life, but the happiness you gain from material possessions is short-lived, he said.

He has sponsored more than a dozen children through World Vision, an international humanitarian organisation, and at his new firm, The Gold Guarantee, he involves his staff in charity work. 

Mr Lee took over the family business in animal pharmaceutical products when he was 20. Two years later, he went to Sydney for undergraduate studies, and to explore living a holistic lifestyle that involved yoga, meditation and martial arts.

Since his return to Singapore, the bachelor has tried his hands at being a property agent, and running a fitness centre and a property investment seminar business. He has also invested in property and gold.

Q: Are you a spender or saver?

I would say I've been a saver in the past 10 years, but my mother would say otherwise. Since I turned 23, I have realised the importance of becoming financially free and creating wealth for the sake of giving back. This is why I save and invest most of my money.

I would say that I spend just about 10 per cent of my earnings. I invest most of my money because I believe saving alone will not help me achieve the financial goals I set when I was 24. 

I was very aggressive in spending on my personal education, in areas such as investment, wealth creation, business, marketing, sales and health. I must have spent more than $200,000 on attending seminars on these topics - more than 30 over the past 10 years.

I invest most of my money in my businesses. I do not smoke, drink or gamble, and I am not into fine dining. The only luxury items I spend on are spa packages for me and my friends. I also buy presents for my friends. It feels nice to be able to buy things for the people I love.

Q: How much do you charge to your credit cards every month?

I charge around $10,000 to my credit card a month. It's a mix of work and personal expenses. I do not carry any credit card debt. In terms of cash, I withdraw a few thousand dollars a week from the bank.

Q: What financial planning have you done for yourself?

I believe in only real estate and gold, which I can see and touch, and which have real value. 

My gold investment portfolio is now worth $30 million.

I have achieved average returns of 200 per cent a year from my property investments and some of my businesses. I plan to achieve a net worth of $200 million; when that happens, I intend to pledge 90 per cent to charity. 

Q: Moneywise, what were your growing-up years like?

I am an only child, and I lived on a pig farm until I was eight. Our farm seemed huge, but we were one of the few poor pig farmers at the time. 

My father set up the animal pharmaceutical wholesale business while running the farm, and my mother helped him with the accounts.

However, we were quite poor until about 10 years ago because my father, who died when I was 17, was a gambler. My parents used to tell me I must never gamble. 

Q: How did you get interested in investing?

It was after I attended personal development seminars. I also read many wealth creation books, which led me to decide on real estate as my investment vehicle.

Since turning 24, I have made sure that whatever path I took would lead me in the direction of becoming a real estate investor.

My first real estate investment was in a rundown basement shop at Golden Mile Complex, which I bought for $250,000 five to six years ago. I sold it three weeks later for $320,000. I put up only $2,500 in cash for the purchase - for the 1 per cent option on the property - as I had managed to negotiate an option period of one month.

Q: What property do you own?

I co-own a highway and a commercial building in Tianjin, China, with my father's best friend, who is a billionaire in Malaysia.

I also have a 12-unit apartment block in Central London and 16 commercial units in Kuala Lumpur. My aim is to spread my property portfolio over five countries to reduce the risks. 

In the past two years, I have sold my properties here, including a shophouse in Chai Chee and a Belmont Green condo unit, as I was anticipating a price correction. 

The market fell in 2008 after I bought the Belmont Green unit, so I had to hold it for three years. I made half-a-million dollars in profit. 

Q: What's the most extravagant thing you have bought?

I recently bought a new Bentley Supersports for $1 million. It's my dream car.

Q: What's your retirement plan?

I have no retirement plan. I feel very fulfilled because I wake up every morning knowing I'm serving thousands of people. 

A year ago, I went to five fortune-tellers, and they all said I was meant to be a teacher. It was the first time I had had my fortune read, and I didn't understand then.

I thought my calling was to make $200 million and leave it to charity. Now, after having set up my gold trading business, I finally understand what they meant. 

As I make my money, I am also inspiring people around me. Anything is possible as long as you believe you can do it. But if you don't believe you can do it, you have already succeeded in failing.

I think I would need a passive income of $100,000 to be able to spend fairly freely. I became financially free a year after I went into the budget hotel business.

When I reach 35, I will spend less time on my businesses and focus more on my spiritual side. I want to set up a non-profit martial arts studio.

Q: Home is now...

A corner terraced house in Hougang, where I live with my mother. It is opposite our animal pharmaceutical business shop, so we store some of the products in our living room.

The house sits on 4,000 sq ft of land and has built-in space of 6,000 sq ft. My mother bought it for $1.2 million eight years ago and spent $1 million rebuilding it. It is now worth about $4.5 million. 

Q: I drive...

A white Bentley Supersports and a white BMW 5 series model.

joyceteo@sph.com.sg

A different President

Ivan Yeow asked:
I was following the presidential elections in Melbourne while studying and rooting firmly for my Ex-MP Dr Tan Cheng Bock. And I was sorely disappointed when he lost by a few thousand votes. Would love to know your stand on the following questions

1. What are your feelings on losing your deposit for the presidential elections?
2. How would the elections been different if you and MR Tan "check-and-balances" Jee Say did not participate and split the "opposition" vote?
3. Would it be very different today if we had a different president?

REPLY

1. I was disappointed on the night of the results, but I forget about it the following day. The loss of the deposit is a small matter for me. The disappointment was greater.

2. If I did not participate in the Presidential Election, it was most likely that Tan Cheng Bock would be disqualified for the same reason that Andrew Kwan was disqualified in the previous election. See my blog post http://tankinlian.blogspot.sg/2012/12/splitting-of-votes.html

3. If we have a different President today (instead of Dr. Tony Tan), there will be a small difference, but it will be insignificant. When Ong Teng Cheong was President, he had strong differences of views with the Government, but could not make them known to the public until his last few days in office. I don't think that TCB could make a difference, but this is just my personal opinion.

I now wish to add a few words that were not said before. Shortly after I collected the nomination form, I approached TCB for a discussion about collaboration in the event that only either or both of us were approved. His reply was "wait for the Election Committee to decide first".

In the following weeks, I received vicious and malicious attacks in the social media and they were traced to supporters of TCB. I protested about this attacks to TCB's campaign manager, whom I know personally, but he denied the allegation. After that, I gave up all thoughts of collaboration.

For supporters of TCB who were disappointed that he lost for a few thousand votes, the outcome would have been very much different ,,,,,, if some of their supporters had not played "dirty politics".

Cost of raising a child

Here is an estimate made by Ryuu Shun Hayashi 

Food - approx $400 a month.
Transport - approx $200 a month.
School fees - approx $500 a month (from primary which is cheaper than this to uni which is much more expensive than this).
Housing - approx $200 a month if two children share a room, in termsof cost difference between 4 room and 3 room flat divided by number of years.
Miscellaneous - medicine, clothes, computers, interests, lost income due to child sick leave etc - approx $500 a month.

Total cost - $1,800 a month ish.

$21,600 a year.

For the 25 years that they'll be under your care, that costs $540,000 per child. I estimate I cost my parents about $400,000 in total so far, costs were lower previously. And I never took tuition classes, but still ended up near the top tier of the A levels. Tuition isn't necessary - you can do a lot better than it for free by simply bringing your children to the library often when they're young, and inculcate a reading habit. There's no better way to teach a child than to teach a child how to learn by himself/herself. I used to give my mom quite the headache by reading 32 books every week - weekend trips to Queenstown community library and all that.

But to be safe you'll need to budget S$600,000 to take care of a child if born today - and this is WITHOUT budget for tuition classes.

If only one parent works, and earns about $3k (or if both work and earned a combined amount of 3k), that's 36k a year. Deduct expenses, the most frugal people can save about 20k a year under these conditions. It takes 30 years to fund one child by one parent. Don't forget you still need to spend on the wedding and on the HDB flat, and you'll need money to take care of your retiring parents as well (or rather, you should need money to take care of them - please don't be an ingrate to them), as well as save for your own retirement. That puts the maximum practical number of children for a couple with one working PMET parent (or 2 blue collar workers) as exactly 1. The maximum practical number with two working PMET parents is 2.

Is it any wonder that few people have more children than 2? Until the income divide is fixed by the State, there will be no increase in birth rate. It is simply impossible to come up with enough funds to safeguard everything even with prudent investment on current pay to support more than 2 children. The only way you can have more, is to cut back on something else - risk your own retirement and put yourself at the mercy of your children or stop taking care of your parents - and neither is a good option.

The Gold Guarantee

Investors of The Gold Guarantee sign Petition 
http://www.straitstimes.com/breaking-news/singapore/story/ex-investors-gold-guarantee-gather-hong-lim-park-petition-quicker-acti

It is quite sad to have another group of investors lose so much of their savings. They are partly to be blamed, because they wanted to earn the high interest rate, which is really impossible.

So many people are involved due to the activities of the financial advisers, who sold these products to them. As the financial advisers are licensed by MAS, the investors may not realize that the products are not approved by MAS. It is necessary for MAS to ban financial advisers from selling non-approved products, to avoid any misunderstanding.

The petitioners asked MAS to stop similar schemes from being sold to the public. I agree with this request. MAS should step in and regulate all financial products, instead of leaving some of them as unregulated. A financial product can be defined as one that promises  a full or partial return of the principal, or payment of regular interest.

Instant car pool

Can't find a taxi during peak hours and on rainy days? here is a soltuion ....
http://tankinlian.com/admin/file.aspx?id=769&IID=776

Population Panic

Here is an excellent article, printed in the Guardian newspaper, about the misplaced fear of a shrinking population. I agree with the views expressed. Generally, I like articles written in the Guardian, which tends to project the view of the ordinary people. 

http://www.guardian.co.uk/commentisfree/2013/feb/26/false-alarm-shrinking-population-panic

Can SMEs survive in Singapore?

SMEs face the following challenges:
- high rental of premises
- high wages and turnover of local workers
- local workers prefer to work for big companies
- supply of foreign workers has been cut sharply

The Government tries to help with the following:
- 40% wage subsidy based on increase in wages given to local workers
- cash grant of $5,000 (last year)
- productivity and innovation credits

Self employed workers are able to cope quite well, e.g
- taxi drivers
- food stalls

But, running a company to employ local workers is challenging.

What can be done to help small businesses, which has not been tried successfully yet?

Photos of Hong Kong

I took the photos of Hong Kong with the app called Moby Pal. It is available in iPhone/iPad.
You can take one or a few photos and send it by e-mail to a preset address with just a few button press. It is quick and easy.

There is also a "security feature". You take a photo and send it by email with the time and location stamp. If anything happens to you, there is a record of the taxi or location where you took the photo. All this in just a few touches.

A great tool, for travelers and for ladies.

http://tankinlian.com/admin/file.aspx?id=748&IID=754

Holiday camps during March school holidays

Here are the holiday camps for your children to learn some thinking skills during the March school holidays.
https://tklcloud.com/book/Booking.aspx

Puzzles
http://tankinlian.com/admin/file.aspx?id=765&IID=772

Puzzles on iOS
http://tankinlian.com/admin/file.aspx?id=766&IID=773

Horse meat

Why is there a taboo against eating horse meat?
http://www.cnbc.com/id/100496993

Holiday camp - Puzzles

A holiday camp for your children (age 8 to 16) to develop their thinking and problem solving skills and have great fun. 
http://tankinlian.com/admin/file.aspx?id=765&IID=772

Book here
https://tklcloud.com/book/Public/Slots.aspx?key=5bfd33831373401ca21a95a46b59f446

Workfare and its impact on business

Hi Mr Tan,

I would like to share with the impact on workfare in my company. Being a public listed company, the company was expecting 30% year on year growth from their subsidiaries, and KPI and variable pay structure was set based on these expectations.

Of course, the staff complained that the global and local economies are having difficulties and the growth targets were not in line with what is happening outside.

With workfare, it was hoped that the targets can be lowered and staff have a better chance to achieve their variable pay components by hitting a lower target. 

However the company while accepted workfare as a reduction of overall cost of doing business, did not translate this back to a lowering of performance targets for the staff. Targets remained as per 30% year on year. So, with or without workfare, it meant little to the individuals working in the company.

Credit card debts

Someone asked:
Are many Singaporeans living off credit cards?

REPLY
I do not have the exact figures, but I have been approached by many people who are not able to manage their credit card debts.

It is easy to get into debt from:
a) medical bills
b) unemployment
c) gambling
d) over-spending on luxury goods or entertainment

It is also easy to charge to the card. Then the interest rolls up. And the problem becomes more difficult each month.

Some people borrow from a new card to repay off the old card. The problem gets bigger. Besides the high rate of interest, they have to pay late payment charges ($50 each time) and legal fees (when the lawyer writes a letter of demand for the bank).

For people who get into trouble, they can consult Credit Counselling Singapore, http://www.ccs.org.sg/

This is set up by the Government. Their people are specially trained and well connected with the banks. They can help you.

Be sensible in covering your personal risks

Some insurance agents show statistics of the number of people dying through critical illness to scare you into spending a lot of money on critical illness insurance.

Consider the following points:

1. Everybody will eventually die from a illness in their old age (if they do not die earlier by accident).

2. Even after spending more than $100,000 on treatment, the chance of success is slim for an elderly person. Insurance is not intended to cover this type of costly futile treatment.

3. Insurance is to protect families when the dependents are young. After 25 years, the children have grown up and the breadwinner has accumulated sufficient savings.

4. If they do not spend $500 a month on a bad insurance product, they would have accumulated $500,000 at the end of 35 years by investing in the right product. They do not need insurance to pay their medical bills - they can use their savings.

5. Insurance agents are taught to tell lies and misleading statements to take away too much from consumers. The critical illness scare is just one more gimmick.

6. If you are afraid of critical illness when you are young, pay $120 a year to get $100,000 of critical illness cover. The chance of it happening is less than the chance of an accident. (The real cost is much less, but the insurance company wants to make a profit).

7. Here is how you can buy a good insurance package, covering death, accident an critical illness to cover a more adequate amount
http://tankinlian.com/admin/file.aspx?id=752&IID=759

Vegetarian stalls

Hi Sir,

 

I’m a vegetarian. Most of the time, I find it difficult to find vegetarian stalls whenever I need a meal. Be it at coffee shops, food courts, etc..

 

Sometimes when I pass by a place, and I know of a vegetarian stall nearby, I will walk over.

To my disappointment, there are many vegetarian stalls being closed down at various places and I got to find non-vegetarian food stalls with vegetarian food.

It is more disappointing when you see a big food court with so many stalls and can’t find a single vegetarian choice.

 

When there is no choice, I got to go elsewhere and search which is inconvenient especially with non-vegetarian accompanies (since they already have choices and not nice for them to keep following me for the search) or when I’m quite tired and just want a meal or it’s raining heavily etc..

 

Usually if there is no vegetarian food stall in a particular food place, the highly possible chance to have a vegetarian meal is from the mixed vegetable rice (饭菜) stall which has meat, vegetables with rice. But commonly, the choices are very little. If they have no potatoes, bean curd, non leafy type etc., the person probably can/will only buy 2 green vegetables with rice. If the person somewhat can only eat at the same place everyday due to time wise, and meet such situation, it will be quite depressing due to very little choice of food and bringing own food may not be convenient.

 

I hope maybe something can be done to help improve such situations especially for those vegetarians who need to travel different places for work often. When they have a short lunch break, and the nearest vegetarian place is very far, it will be a problem.

 

 

I have some humble suggestions:

 

1. Not all food places have vegetarian food stalls. Those which have closed down may find it difficult to maintain the rental fees especially vegetarians are the minority. Maybe the vegetarian stall owners could have lower rate rental fees or subsidiaries to help them. Maintaining current vegetarian stalls in Singapore may not be enough to cater to most vegetarians, such idea may also attract people to do such business if they already have in mind but afraid of low number of customers. If budget wise, maybe only those owners who can’t hit a certain income, will be able to get such subsidiaries.

 

2. There are some places where there are quite a number of vegetarian stalls beside each other.Maybe some allocation can be done to allow only a certain number of such stalls to operate within a certain zone.Thus, hopefully, vegetarian stalls can be spread evenly in Singapore in the future which is more accessible.

 

3. Most of the stalls like the beef noodles, fried kway tiao, western food stalls are commonly seen in the food places and hardly have any vegetarian choice. If they could come out with some vegetarian food, example vegetarian noodles with mushroom, fried beehoon with vegetarian popiah, vegetarian spaghetti respectively, will be good. If each stall could have at least one vegetarian food, even without a pure vegetarian stall there, at least the vegetarians who visit there would have some choices. Such stall owners may be entitled a small encouraging subsidiaries or so.

 

 

By “promoting” vegetarian eating may not only for the vegetarians. There are some people who will eat vegetarian meals during the 1st and 15th day of the lunar month. It will also be convenient for them. Even omnivores could be having meal at those stalls. Hopefully the government could think of ideas and help promoting of vegetarian food stalls opening. After all, it is about solving the basic necessity of some human needs with ease. (“Go Green Campaign”).

Advantages of renting a home

1. Singaporeans have the mindset that they must own their home. I wish to give some views on the need to change this mindset.

2. Owning a home make sense when property prices are low. When the prices are too high (and currently the prices are too high), it is not the obvious choice. We should be open minded and consider other options. 

3. There are advantages in renting a place to live in. When you rent, you have the freedom to move at the end of the lease period. You can move to a place that is closer to your work place or to your parents or the children's school.

4. If the rental rates are high, you bear the cost one year at a time. You can also opt to rent for 2 years or longer, if you wish to fix the rates.

5. When you buy a property at a high price, you have to pay a high mortgage for the next 20 or 30 years. You are stuck with this high cost.

6. It is possible for the property prices to go into a slump. Just see what has happened in Japan, USA and Europe. This will come to Singapore. When that happens, the property prices will stay low for a long period. Japan has the slump for more than 20 years and has not recovered yet.

7. If you are renting a place, you will be able to buy a property at a lower price, maybe up to 50% cheaper, in a slump. If you have bought before, you will not be able to take advantage of this opportunity.

8. In Singapore, you are allowed to use your CPF savings to pay for your home, but not for rental. This force most people to buy a property. If you do not join the herd, you have the option to invest your CPF savings in blue chip shares or an index fund, and earn a long term yield of 6% (my guess). This yield is better than the yield on properties bought at an inflated price.

9. If you rent a property, you can pay up to 25% of your annual income for the rent. This may be painful, but it is for one year at a time. When there is an over supply, you can expect the rental to drop by up to 50%. At that time, you will pay a much lower rental or you can buy a property at a lower price.

10. For young couples who are newly married, you can stay with your parents, if they have a room for you to use. Alternatively, you can rent a room from another family. If you do not have any children or just one baby, a room is sufficient.

11. It is all right to buy a new flat from the HDB, i.e. a BTO flat, as the price is much lower than the market price. Be patient and wait for the BTO flat. In the meantime, consider renting as an option.

How to increase the birth rate

1. I will now give my views on how to increase the birth rate in Singapore.

2. We must give an option to women to be a full time mother and raise children. The mother will receive, from the state, a monthly allowance of $500 for each child, up to a maximum of three children, until the child reaches 12 years old.

3. If this allowance is given, some women may opt to be a full time home maker, instead of a career women. They can opt to get married at a younger age, and raise their children. When the children go to school, the mother can enter the workforce and do the types of jobs that are suitable for them, which do not require a high level of education.

4. There are many suitable jobs in the economy for women, with experience in raising children. They can be assistants to teachers, or work in taking care of children and the elderly, or can go into the food business. These jobs can also pay well.

5. The choice is still available for women who wish to enter the business world and compete with men. These women are likely to marry late and to be not keen to raise children, as it is difficult to do both.

6. My suggestion is to give women, who are more inclined to the family, to choose this option, and to receive a monthly allowance that make it possible for the family to meet the living expenses.

Critical illness policy

Someone said:

Should the MAS bans / regulates more strictly such or similar "critical year" policies. 
For this case :-
"In a written judgment, the Learned Judge dismissed her claim. The judge found that the document, a policy benefit illustration, was not part of the contract. He noted that a clause in the policy booklet states that the policy and policy application constitute the agreement between Madam Zhu and AIA. This statement is mirrored in a declaration in the application form."...

Although not "a clause in the policy booklet" and therefore not a "term or condition" in contractual terms, the "policy benefit illustration" is a common instrument used by agents (who are supposed to be professionally trained) to induce parties (as consumers & layman) into purchasing such policies ... and therefore easily "misrepresented".

IMO, the plaintiff in this case was set-backed because she had represented herself in Court...she could probably have a strong case. I purchased such a policy in the 80s which was subsequently handled as a "support package" collectively ... but the same "sales techniques" seemed to have been followed through after that ...and now another case in Court when many are supposed to be already wary of such bad sales techniques.

http://news.asiaone.com/News/Latest%2BNews/Singapore/Story/A1Story20130219-403050.html

Fair wage for a job

What is the fair wages for a job? 

Some people think that it can be left to the "free market", i.e. supply and demand. This is the approach adopted in Singapore. Look at the mess that it has created - so many locals out of job or not earning enough to meet the cost of living. 

Some countries have strong trade unions to negotiate the wages for various categories of workers, e..g Australia and Europe. They also use the tool of a minimum wage. While not a perfect system, it seemed to produce a better outcome than the "free market approach".

There is an alternative approach - somewhere in the middle. It uses the free market approach to determine the wages, but removes the weak bargaining power of the workers. It also ensures quality, reliability and profitability of the workers and allows them to earn more, and allow their employer to be profitable. What is this method?

I like to have some discussion about this "alternative method", which is a better way.