Business

Saturday July 4, 2009

Your 10 Questions


What do you enjoy the most and the least about working in the construction industry? Malek Ahmad, Malacca

What I enjoy most is the legacy of well-executed projects that will remain lasting images of something beautifully built to be admired by all. I am proud to say IJM has been instrumental in a number of landmark buildings, townships, highways and other infrastructure projects in Malaysia and overseas. It felt good when a stranger came forward in India recently and said that IJM has set a new quality benchmark for well-built roads in India.

The part I least enjoyed is the negative publicity arising from accidents due to construction failures or fatalities at site. With human intervention or acts of nature, sometimes, despite all the precautions and stringent controls, accidents do happen and these can become fodder for negative news. The reporting can be at times not entirely accurate and very detrimental to the company’s image.

Is economic recovery all about stimulus packages and oil hitting US$100 per barrel once again? I disagree, but would love to hear your opinion. Ir Kumar Subramaniam

In a period of general economic uncertainty, and private sector and consumer pessimism, public sector spending is necessary to prevent economic activity from spiralling downwards. Business confidence needs to be re-established. Stimulus packages are indeed then necessary to provide the missing lift.

Oil at US$100 is a double-edged sword for us. Through Petronas, the Government will have more money for the stimulus but the escalating cost of oil will stifle worldwide economic recovery. One should also not forget the increased burden of additional subsidies required if oil-induced inflation escalates dramatically.

In a 2006 interview, you mentioned that “things are not always sweet and rosy”. Yet, you have managed to keep IJM’s order book full. How? Uma, Johor Baru

We have always believed that even in times of crisis, there will be pockets of opportunity. The key is to be constantly on the look-out for them or find new ways to address them.

In the mid-1980s, when infrastructure jobs were lacking, we promoted the privatisation of low and medium-cost apartments in big numbers in joint venture with state governments to create our construction order book as demand was strong and end financing was available. The property margins were not great but together with the construction margins, the sums were good.

In the current crisis, spending on construction sector has been identified to be able to provide the biggest multiplier impact. Hence, new opportunities in an uncertain environment.

Next, if you widen your horizon, there are opportunities beyond your borders. For instance, India which is seeing GDP growth of over 6% needs infrastructure spending to continue in a big scale to sustain this growth. In fact, we foresaw this emerging trend 12 years ago, engaged the market and have been building our track record there ever since. Similarly, there are opportunities in the oil-exporting countries of the Gulf.

But then filling an order book is one thing; making a buck out of them in a volatile cost environment such as now is another challenge altogether. Just look at our results last year for a reminder.

When you were growing up, what did you want to do? Did you see yourself running a construction and property business? Patrick Wee, Kulim

In my early days, expectations were low. Based on our meagre family income, one’s greatest expectation was to try to finish school. I remember those days, when asked to write essays on what we aspire to be, the general consensus would be to be either a teacher, fireman or postman, etc, not to be doctors, engineers or accountants. In fact, after finishing school, I had intended to join the air force and hopefully become a pilot. I had okay grades and was a good sportsman. But with luck, a scholarship from Selangor took me to Universiti Malaya and the rest, they say, is history. Did I see myself running a construction and property business? Never in my wildest dreams.

How do you balance work and family life? See Eng Hock, KL

Truth be told, I don’t think there is such a thing as a balance between the two. An imbalance is more accurate. We have to make some sacrifices. My wife and family have accepted the realities of the competition for attention from what are called my two “mistresses”. One is the very demanding IJM; the other, less trying, is named Cobra or the Combined Old Boys Rugby Association. On relative terms, Cobra is a lot less demanding as there is an excellent set of volunteers keeping it buzzing with minimum need for oversight or my presence.

Fortunately for me, my wife, and my mother who lives with me, have taken care of the family side of things well to enable me to devote attention to these two mistresses. My kids too have managed despite seeing little of me in their growing years. I guess I have been lucky and privileged. Perhaps, getting my wife to be a teacher for her career has something to do with it.

You must have been asked this hundreds of times, but what’s the story behind your unusual name? Jennifer Charles, Kuantan

I am what you identify as a ”Chin-dian”. Gender equality, obviously started very early in my family and is reflected in the names of my siblings and myself. As my mother was a Hindu, the name added was Krishnan. Otherwise, it would have been a Christopher or something like that, and you would not have been so curious.

What have you achieved in your 27 years at IJM that you are most proud of? Hamid Atan, Shah Alam

I have only led the IJM Group in the last 12 years. I think, together with the work of my predecessors, we have built a sense of integrity, professionalism and “shared destiny” among our people that is at the heart of the culture of this organisation.

If we can cherish this as the company grows, the group will be in good hands and its future bright.

What made you decide to announce your retirement more than a year in advance? Khalid Zainal Abidin, Alor Star

Though the succession process for me had been put in place a year ago, the announcement of my retirement through the media was not planned. The media followed up on an answer I gave to a question raised on succession planning at a recent corporate governance conference and my intended retirement plan became, unintentionally, public knowledge.

Now that it is public knowledge, in a sense, the deadline is good as the corporate and people-level adjustment processes can now take place in earnest. And I can work myself out of a job nicely.

How do you plan to spend your time after stepping down as IJM CEO next year? Wee Li Peng, Seremban

Actually, I have not started thinking about it. But I have already been bombarded with many suggestions and recommendations from well-meaning friends and family. Perhaps, as a start, I will try to remedy the work-family life imbalance of my past.

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