Honda Civic (8th Generation) Vs Proton (2nd Generation)

Lawa gileee keta ni.....

On Friday afternoon, I went to the Honda showroom in Tmn Tun and damn it!! It was love at a first sight for me as I saw the much anticipated 8th generation Civic. As I entered the showroom, one of the sales guy straight away greeted me and ushered me to one of the displaying unit. He started to explain about this new model and I listened attentively. The on the road price is about RM117k for the 1.8 litre model and RM130 for the 2.0litre. To some this is a bit pricey. But to others, especially those who appreciate Japanese built cars would feel it’s worth every penny. I know however that ‘manufactured’ price is much much lower and if it’s not due to the high import duty and taxes, the car could have been owned by many-many Malaysians with a discerning income. I somehow feel that we Malaysians are in a way ‘robbed’ of our rights to enjoy and consume high quality products especially foreign made cars on the pretext of protecting our national automotive industry. I’m all for this national agenda really, but at times, if you think about it, as much as we want to be a player in the global car industry, as a consumer, I want to have the power of choice to purchase goods of my own preferences. The government is trying hard to create a level playing field for the local manufacturers to compete with other global producers. But somehow, I feel that this ‘protection’ had been given for a bit too long at the expense of majority of the end users.

Don’t get me wrong, I respect and I will always support this national aspiration but without a proper implementation plan and most importantly a clear timeline to achieve the objectives, it will be a waste of billions of public funds and labour hours which could have been channeled to other national projects. I guess it was a risk worth taking by Tun Mahathir back then to springboard Malaysia into the manufacturing forte. Who would have thought that a nation of rubber and tin exporter could produce its own national car? So to be competitive domestically, the Government introduced many protection policies towards the national car project and as a result, Proton cars are considered as the staple choice for majority of Malaysians car users. Since this is a national agenda, the Government has the responsibility to ensure that the outcome or the result of this effort, comparable with the global benchmark. This is the only way how our national producers can ever compete with other car exporting or assembling nation. Years have passed. Although I have witnessed tremendous improvements in our national car, I honestly feel that it is still not enough. We are still way behind the Japanese or even the Koreans and what I’m afraid of is, nations like India or China, who have just started their own national car later than us could leapfrogged Malaysia in the next couple of years.

So where did we go wrong? How come after nearly two decades in this arena, we can’t still directly compete with other global players? Have we achieved what we have wanted in the first place? I have a feeling that the sense of achievements in this national agenda have been felt completely on the first day when the first national car rolled out of the factory. That was it! We have made it! We have produced our own car and on that particular day, they could tell the whole world that we’ve done it. Everybody was impressed at that time I’m sure that many of us can still remember the year when the first Proton Saga was unveiled in the local media. It really was a glorious moment for many Malaysians but the stories were told short of the company’s plans on how they intend to be an advance manufacturer for years to come to able to produce high quality products meeting the stringent international standards and competition. During the initial years, with the protection that was given by the government, Proton factory mass produced the national cars and it instantly became the best selling model in its segment. The problem is, mass produce capacities, have little room for innovation and quality. So to inject more ‘creativity’ in their production line, they’ve invested in Research and Development capabilities and acquired well known brand with the hope that transfer of knowledge and technology could spurned the innovation cycle. Sadly, I feel that this has come a bit too late or not effective when it should have been part of Proton’s set pieces from day one.

So how much longer will it take for Proton to able to produce cars at par with the other well established names? People could say that we are still in an infant stage (after 2 decades still infant ka??) and other nations have been in this industry very much earlier than us, so we should give Malaysia more time to evolve in this industry. To me this is not right. By the time we reach the level where other advance manufactures are today, our foreign competitor could be two or 10 steps ahead of us! Instead, to be able to compete globally, we must always be one step ahead of them! But the question is when are we going to able to do this? When is Proton going to be able to produce world class cars and not pricing it discriminately? I hope I will live my life one day and able to say that Proton is at par with Honda. But until then, today, if given a choice to buy a Proton car or a Honda, with the household income that the majority gets, I guess we wouldn’t opt for the later due to obvious reason. The price disparity is too mind boggling when the cost of manufacturing the two brands of the same segment can be said as competitive. The price we pay for a Proton Gen 2 car in Malaysia today could be worth equivalently to an 8th generation Honda Civic baught in Japan!

So why am I babbling about all this? HHmm.. for me, the acquisition cost of a brand new Honda car is too costly. About 3-4 years ago, I bought this Accord Inspire and it had many-many features that only the luxury car segments have. Since I can’t afford a brand new model, I opt for a second hand unit. But you know la..second hand cars requires lots of ‘tender loving care’ Last week, the car broke down again. This time I’ve to transplant the gearbox and the engine as well. I’ve spent thousands on this car on maintenance alone and I’m going to spent more for this latest breakdown. So that’s why la aku tengah sakit hati niii…. Pegi tengok civic baru, pastu bila pikir betul-betul, the car can be purchased at Proton’s price if it is bought in Japan! Rasa rugi pulak beli keta Honda 1st hand. So I told myself, tunggulah nanti, beli second hand civic jelah! Hehehehe But who knows…kalau tak tahan..ikutkan nafsu…and kalau nak makan pasir….Inspire kata pergi…Civic kata marii!! hmmmm..tapi kalau nak tunggu Proton buat kereta macam Honda..lagi la berjinggut!!!

Opening Up Possibilities...

February is the first month where I had to manage the entire domestic billing operation for TMW’s division. I am today responsible for the production of bills and accounting recognition of revenue and expense for the services that TM rendered to its wholesale customers. It’s entirely a different segment from the retailing business as it involves billing and settlement relationships with other license operators (MAXIS, DIGI, etc ), ASP’s, ISP’s, resellers and others. From traffic minutes to space rental/ co-location charges, I have to ensure that these services are properly billed and accounted for the company’s monthly profit & loss and balance sheet. I’m contributing to the recognition of annual revenue of more than RM3billion for this division.

About a year ago, this department that handled the billing operation, consist of a Manager, 5 Executives and 6 Non-executives. When I came in, the management decided to restructure this department into 2 separate units. They removed all the executives post, maintained the number of non-executives and had 2 managers in charge of two separate billing functions. In other words, each manager has at least 3 non-executives directly reporting to them. The rational behind this is to increase productivity of staffs, reduce redundancies and I guess to justify our importance to the company. So there I was, for about 4 months, since August last year, had the experience to work in an operation unit when all this while I've been working in the Costing department doing analytical and strategic assignments. I just told myself that anything new, will be hard initially. It was tough really switching perspectives to an operational environment. I’ve learned that one need to be very-very organized and must be highly attentive to detail. Nevertheless, it’s a valuable and essential experience as I had expected that one day in my career, I would be doing operation and learn many new things from this. If I were to do strategic functions again after this, believe me I would appreciate better the implications that it would create to the operational layer or the importance of inputs from the people on the ground before making or proposing any strategic decisions. Because almost all the time, these are the people who have direct contact with the customers, these are the people who makes things happened and most of the time, unfortunately these are also the people who get the blame when things turned ugly. And the worst thing is, we are constantly bugged by auditors assessing our compliances status to statutory requirements when in the first place, the whole setup is running based on models adopted from other Operators with a not so successful or business proven concept, claimed otherwise though by the Consultants. At least I’ve proven to myself and the rest that I’m adaptable and I could fit in this part of the organisation. To me it all boils down to attitude.

After a couple of months in this department, I’ve managed to make some assessment. I finally saw the linkage between operation and strategy. To put it in simple terms, in my opinion, strategy is survivability in a highly competitive market like this. No doubt that we need strategy to drive and direct a company towards its mission and vision. But in our urgency to achieve these goals, to me it’s a fatal error when Management tries to push the organisation and sidelining the learning organisation strategy. I know that in today’s world, organisation must be able to move with great agility to adapt to the external ‘environmental’ changes and at the same time conduct periodic ‘health’ check and make adjustments when and where necessary. I believe that the long term survivability of an organisation stands on its ability to evolve from within where the people themselves are the change agent adapting to external environment or be the market leader themselves. Selling products and services that meets customers demand is an essence to any profit oriented organisation but creating new demand or market perhaps is an art and the next step for an organisation to stay ahead of competition. To me learning comes from within. Everyone in this company in a way or two is also a customer to this great company. It’s an untapped pool of knowledge and experience where the company can leverage on to drive its growth by selling innovative products and services. Practice what you preach is the best phrase to encapsulate what I'm trying to say here. The company must firstly educate all it staff on the benefits of the service and allow them to experience the service themselves. All this while, when a service is launched, it is always the customer that knows about it first but we have always forgotten about the other customer which resides in the company that ensure the service is uninterrupted, bills are produced timely, complaints are handled carefully and customer is taken care off. How can we really sell these services to customers when majority in this company have not heard about this product? Some of us are only lucky enough to be part of the trial and testing phase just before the launching of this product. Dapatla..buat test sikit-sikit..

My point is, competition will not go away. It is here to stay whether we like it or not and it's not going te get any easier. Most management would want to see the company bring results but at times, unfortunately due to their 'contractual' nature of appointment, they deploy short sighted strategy which probably brings short term gains. Increasing sales via discounts and price war, cost reduction and prudent spending have always been the right strategies. In the long run however, I think innovation is the key to survival. TM with a strong workforce of more than 20,000 people with many international presences, has an untapped resource that could take the company to the next level. This resource lies not in the network capacities that we have invested or the technology that we have acquired. This resource is called Human Capital. Practice what you preach. If you tell your customer that your service will benefit them greatly, then give it to the staff for them to experience it too. There are many great advantages to this really both in the short term and the long run whether from the sales or the technical support point of view. But the benefits that I would like to stress here is in relation to the learning organisation aspect. When the staff gets to use these services themselves and experience it first hand, we automatically want to ensure that the service we put in is of great standard and quality. We would expect that customer service is of world class and we would expect that what we get is off great value. This way, we would know ourselves where the weaknesses are and if we’re lucky, before the external customer complaints, we might have tweaked the error based on ‘internal’ inputs. Sounds effective huh? But this not the real advantage that I’m trying to highlight here.

As a learning organisation, we must learn and unlearn. But how do we want to learn if we’ve never experience it in the first place? If we internally act as users of services that we sell in the market, in the long run, we could always have the advantage of offering innovative products and services. With the involvement of the internal customers, the whole organisation acts as a giant R&D engine that churns out ideas or suggestions for continuous improvement and at the same time and more importantly, be the market leader that create trends and new demand stemming from innovative products and services. We have many companies today trying to be the number one operator in the country gauged by the number of subscribers that they have. But when the market saturates, what will happen? Invest overseas? Acquire companies? Or ask Malaysian’s to double their population so that we could create new growth domestically? It would be great if the ambition of being the no. 1 service provider in the country as a short term or medium term target, coupled with the long run objective of making TM staffs the most up to date and tech savvy population in Malaysia. I believe that innovation is the key to long term sustainable growth and survivability. There would come a day when there’s too many technology available that the operator have to create new demand to generate growth. To inculcate this innovation culture in an organisation, we must allow the staff to have the experience first. Treat the staff like a customer. Let them use and experience the services themselves. We would learn from each other from these experiences and share the knowledge to improve the services. Being technology savvy, we would always want to be ahead of the general population. We want to be seen as the trend setter. In a highly competitive and saturating market, tapping niche or segmental market is the key to growth. To stay ahead, we need to be innovative and innovation through experience is an ideal strategy. This way, the organisation could innovatively evolve from within and hopefully, in time, drives the market and not the other way round like what we are facing today.

Its just senseless telling people how great your product is, but you yourself are not using it. You might fall to a different market segment, but we do have products for all the segments right? A good example would be the 3G technology which MCMC report has suggested that there is a lack of awareness among customers about its benefit and there’s not enough effort by the Telco’s in creating demand. If you think that is terrible, try and ask the people in TM, I bet majority of us don’t even know or realise the full potential of this technology. Macam mana customer luar nak tau about 3G kalau internal staff pun tak tau pasal 3G? Wouldn’t it be great if the service is provided to all TM staffs and with the different demographics that we have in this company, wouldn’t us be a great sample of the Malaysia population? A great sample that would provide feedback on what kind of services do we really expect from this service? A service that caters for all walk of lives? We usually know what technology to acquire, but most of the time failed to excute the right deployment strategy. To mitigate this risk, perhaps the service should be deployed to the internal customers(staffs) first. Nothing to loose, staffs will be happy, if they're not, complains will come internally and not from the external customers. It is difficult if we are championing 3G to the customers when they can see that TM staffs are not users of this technology themselves.So this is a positive point in the marketing sense la. You practice what you preach, then it's easier for others to follow. Again this is just one immediate advantage from learning through experience.

I’m just worried that things are just going to get tougher in the telecommunication industry. Our competition comes not only from the big players like MAXIS, DIGI and TIME, but includes other ASP’s Resellers like Redtone, Nasioncom which charges customers at VOIP rates. All the while, we are pressured at providing the cheapest rates to callers and this has led to price wars that could only hurt the industry as a whole. And all of us in the industry are feeling the pinch today. The solution is, to fight your margin by identifying the key market segments that provides the highest contribution to the company. By identifying which products and market segments that provides the biggest margin, the marketing and sales effort should be concentrated here. It is not viable to put up more resources to segments that contribute lesser and lesser margin as it gets more expensive to service the customer as the volume increases. However, still, managing the right customer and product mix is considered as the short to medium term approach in sustaining growth.

I just hope that there would be awareness in this company that the industry that we are in is to connect people. Communication is an essential medium and it’s already a necessity for most of the people in this world. We are actually providing the platform for human being to make an emotional connection with each other. We drive the convergence of communication technology with the people. It’s ironic however when TM as one of this ‘platform’ provider to the world, most of the time, failed to connect and bring the technology to the people within the organisation. Sad as it sounds but do note that we are in the process of change and hopefully with these changes, we would be opening up possibilities to greater achievements. But if only we could tap the potential that Human Capital could bring, I think we can not only open up new possibilities, but we could go beyond the impossible!