Business

Saturday February 28, 2009

The pursuit of excellence

By CECILIA KOK


Bani Zainal Azmian

While it is a trend now for companies the world over to talk about cutting costs - and that includes staff layoffs - Malaysia’s leading independent power producer Malakoff Corp Bhd is certainly among the few that is bucking the trend.

In an exclusive interview with StarBizWeek recently, Malakoff vicepresident for human resources and administration Bani Zainal Azmian says that the company will spend up to RM4.

8mil this year on the training and development programme for 640 of its employees.

That represents twice the amount it spent in 2008.

And given the rising global economic challenges, the mission on which Malakoff has embarked is truly something to shout about.

Last year, the company spent about RM2.

4mil to train and develop 633 of its employees, compared with RM2.

5mil on 555 employees in 2007 and RM1.

3mil on 492 employees in 2006.

Malakoff managing director/chief executive officer Ahmad Jauhari Yahya explains that the company believes in investing in the development of its human capital, which the company treats as its most valuable asset.

Hence, Malakoff does not regard the money that it spends on the training and development of its employees as a cost.

Rather, the company takes it as an investment, and one that is vital, explains Bani.

Developing people for the future

According to Bani, Malakoff’s investment in its employees is aimed at “developing its people for the future”, in line with the company’s ambitious plan to go on the overseas expansionary trail.

At present, Malakoff operates six power plants in Peninsular Malaysia, three in the Middle East and one in North Africa.

Its core businesses include power generation, water desalination, operations and maintenance, electricity distribution, district cooling and project management.

Bani reveals that the company is planning to make further inroads into the Middle East, that is to Oman and Kuwait, in particular.

He adds that the company also has plans to set up presence in other South-East Asian countries such as Singapore, Indonesia, Vietnam and the Philippines.

So, as part of its preparation to be a leading international player, Malakoff is focusing on developing local talent to equip them with the technical know-how as the company moves into those markets.

Bani says: “We want to pursue excellence to raise the bar on global standards”.

Bracing through the challenges

As to how the current economic conditions are affecting the company’s plans, Ahmad Jauhari frankly shares about the challenges every industry player faces in raising finances for their expansion plans.

“There is a lack of credit in the market.

Even if credit is available, it is very expensive,” he says.

No doubt about that, as the heightened risks stemming from the current economic crisis have raised financing costs for the corporate world.

And since the cost of financing is so high, Malakoff thinks it is not viable to raise funds in such an environment.

Malakoff is one of the leading corporate bonds issuers in Malaysia’s public debt securities (PDS) market.

To date, it has issued up to RM7.

9bil worth of PDS.

Its bonds have also been ascribed pretty strong ratings of at least A2, and all with stable outlook, by RAM Rating Services Sdn Bhd.

Meanwhile, like all corporate players, Malakoff is just waiting for “sanity” to return to the market, and then, the company is ready to charge full-force with its expansionary plans.

For now, though, the company is focused on consolidating and improving its internal processes at the operations level to maintain its competitiveness in the current tough environment.

An ideal employer

Regardless of the kind of operating environment, corporate social responsibility is still on Malakoff’s to-do list.

Bani says the company will continue to provide scholarships for deserving students to pursue foundation and degree programmes at Universiti Tenaga Nasional, or Uniten.

Malakoff’s scholarship packages generally cover the full-cost of the students’ tuition fees, and it comes with a yearly subsistence allowance of around RM6,000 for a duration of up to five years.

As of February 2009, Malakoff has granted up to 47 scholarships.

In addition, the company plans to absorb more than 150 interns from local universities and polytechnics this year to enable them to gain exposure and knowledge about one of the most important sectors in the world - that is, power.

Malakoff provides internship training for between three and six months, during which the company also pays the interns an attractive remuneration.

According to Bani, internship programmes have proven to help the company promote better retention.

For the last three years, Malakoff has provided internship training for more than 250 local university and polytechnic students.

He reveals that graduates who have been through internship training with Malakoff usually return to work with the company upon completion of their tertiary education.

If staff turnover rate is anything to go by, Malakoff certainly qualifies to be called an ideal employer.

To date, the company boasts of almostzero employee turnover rate.

(Under normal market conditions, the average employee turnover rate in Malaysia is 18% based on international human resource consulting firm Hewitt Associate’s 2007 Total Compensation Management Survey.) When asked about the secret for the company’s high staff retention rate, Bani says Malakoff takes good care of its employees.

“We have a clear career path for our employees.

This is to give them clarity on the directions they are headed with the company,” he says.

Besides that, Bani says it is also important to have a meritocratic system, where employees are assessed based on their competency and are fairly rewarded.

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