An interesting (or sad ) article picked from A.net : http://www.airliners.net/discussions/gener...47/6/#ID2648247
Have a read:
The MAS Chief Financial Officer, Low Chee Tong,
announced his resignation today, 23 December 2005, after a long and blighted career. There is much more to this man than is known to the public. He has had a special relationship for a long time with Citibank, to which
he had channelled MAS banking business for a long time. He has also cost MAS much money. When he was personally responsible for the MAS office in SaudiArabia, where the company has operations, for ten years, he did not file tax returns to the kingdom, as he should have, and MAS had to pay a RM10 million fine to the Saudi authorities, in addition of course to the tax
due. But despite, or rather because of, such bungles, he was promoted to
CFO.
In 2004, when one of his cronies was Accounts Manager
in MAS office in London, the office lost RM40 million through forgery
and dubious investments. (None of this was reported in the local
media and the matter is still outstanding). When the Accounts Manager was on leave, someone forged his signature and moved RM40 million from MAS' time deposits account in London into some dubious short term investments. Themoney was almost completely lost. Until today, MAS senior management
does not know how much money was recovered from the dubious investment.
But never mind. Mr Low recalled his protege from London, reprimanded him and, as punishment, posted him to MAS' Los Angelesoffice. This was not reported in the local press because Mr Low had put aninternal gag order on this RM40 million caper. No one in the finance department in MAS was allowed to talk about this matter.
Now MAS faced another problem. They did not know that Mr Low had outsourced to a company called Tipro to do something called AssetTagging. For a billion Ringgit company with Botero paintings on itswalls, MAS did not know where all its assets are. If someone were to walk outof MAS with a computer or fax machine, he could for there are no proper
tracking procedures to tell MAS which machine was lost. Asset Tagging is no bigdeal. MAS' own staff had offered to do an internal Asset Tagging using contract workers that will cost less than RM300,000 and can be done in about ayear. But the Chief Finance Officer did not agree. He told Tipro to do
Asset Tagging instead.
Cost? RM5 million or more than 12 times what it could be done in house.
And how will Tipro get the job done? They will go to
the same employees, get all the bar codes and numbers from MAS' own employees, even ask MAS employees to print the bar code stickers, and then they would just the sticker on the fax machines, photocopy machines, etc.
And we are wondering why MAS keeps losing money?
There has been redefining of work functions and somesoul searching in MAS since the MAS' news hit the fin. The RM7,250-a-day Orang Putih con-sultan, Chris Andrews, has had his duties reduced. Hissidekick, Mazidah Mohamed Noor, has also had her duties reduced. But MAS senior management is still clueless on what to do. They are still doing what they have always done wrong. Mazidah has appointed another Orang Putih con-sultan for something called 'Sourcing Value' to renegotiate the lopsided contract with LSG Skychief (the catering company) and the IT sourcing contract with IBM. (In the 9 months from April to December 2005, MAS has paidRM100 million in con-sultan fees and paid IBM RM100 million for IT Outsourcing. So many people are feeding off MAS and by extension the taxpayers that it is not funny anymore). The cons-sultan for 'Sourcing Value' is the same con-sultan who engaged IBM as the IT source in the first place.
Why can't Senior General Managers, like Mazidah, read
the contracts themselves and renegotiate, instead of hiring more and
more con-sultans to do their work for them?
The Chairman, Munir Majid, has recently hired another
con-sultan called Ogilvy and Mather, an international public relations
firm, for RM80,000 a month, or RM960,000 per year, to manage the image of
the Chairman's office.
Among Ogilvy and Mather's advice to Munir Majid is to
have road-shows to explain his side of the story. Road-shows to where? So
far Munir Majid has had four road shows ?with the MAS Employees Union,
with the MAS senior general managers,?general managers and with the
managers. Why do you need to pay RM80,000 per month to tell you to go and talk with your own employees? Do you have to go to university to wash
your backside?
During the road-show with the Managers, someone asked
Munir Majid, what the qualifications, experience and contribution of the
RM7,250-a-day con-sultan, Christopher Andrews. Munir Majid said Christopher Andrews had vast experience working for Air New Zealand and had helped him understand MAS better. In other words, MAS had to pay an
Orang Putih foreigner con-sultan RM7,250 a day so that Munir Majid will know the MAS, a Malaysian company, better! Munir Majid forgot to mention to the Union members that Air New Zealand went bankrupt in 2002, and Christopher Andrews was thrown out of work. He landed a plum jobin MAS. The same goes to Peter Read, the new Chief Operating Officer hiredfrom British Airways.
British Airways had made record losses and laid off many senior general
managers like Peter Read, who are very lucky indeedthat they can run to
places in the Third World like Malaysia where theyland plum jobs, and
given preference over their citizens.
Another con-sultan, McKenzie & Co, has recently been
hired to help MAS overcome its immediate cash shortage. But why not ask
its team of seasoned mid-level Managers (not the General Managers or SeniorGeneral Managers) how to go about saving money or raising cash? And savingmoney in the process?
At the Human Resources Department, or HRD, the General
Manager ?a?Haji Yusif who was kicked out by Tan Sri Zeti Aziz from
Bank Negara Malaysia ?" has hired yet another con-sultan to conduct a surveyamong MAS employees to find out their views about what is wrong with the company! You can find this out by putting a good Suggesting Box in the Cafeteria or by talking to the people on the ground.
The General Managers and Senior General Managers in
MAS really don't know their jobs; instead of using their brains, they hire
con-sultans. The HRD man is who negotiated a 25% rise for the MAS pilots
and which will cost MAS tens of millions of ringgit a year. In a big bungle,
the 25% pay rise includes 30,000 man days of leave which the pilots had
accumulated. The previous capable man in charge of pilot negotiations,
a Mr Keong in HRD, was not consulted at all.
This year, MAS has sold an airplane. They thought they
had made some money, but they forgot they sold the plane with a defects
liability guarantee whereby MAS is liable for every single repair, even
after the plane is sold.
The result is that MAS has paid more to repair the
plane that it received for selling it. How did this happen, with so many
highly paid con-sultans?
While briefing the Senate for two hours on 20 December
2005, Idris Jala, the head hunted chief executive, told Senators that 75% per international routes are not profitable. This is true. The Los Angeles
route has never been profitable even after 20 years. Then there are also
foolish routes like KUL to Johannesburg in South Africa and which flies on to
Buenos Aires in Argentina, which are almost empty on every flight. But
the then Prime Minister, Dr Mahathir Mohamed, wanted to show the flag
in South America and MAS had no choice about this route. Can Idris Jala
chop off these loss-making but flag showing routes? Would he be
allowed to?
But SIA flies these routes, and they make money. SIA
makes money on its Los Angeles routes. How do they do it? Or are there other factors that causing losses for MAS?
While MAS makes losses, its ticketing agents are
making tons of money. MAS has appointed GSAs or General Sales Agents, who arethe sole agents for selling MAS tickets in many countries. The GSAs aremaking a killing, while MAS is getting killed. How so? The GSAs get ticketsfrom MAS at huge discounts, which they can mark up and sell to the
public.?So while MAS suffers deep discounts, the GSAs make huge money
again running innto millions of ringgit.
Who are the GSAs? Well, the GSA in Pakistan is owned
by the Sultanah of Pahang. The GSA in Italy, a company called Mal-Ital,
is owned by the Tengku Mahkota of Pahang (There are a few Datos from Pahangin MAS!) The GSA in Sweden is owned by a Malaysian who is presently a PRin Sweden.
The Botero paintings have kicked up a big fuss. The Senators have told
Idris Jala to sell them. Munir Majid has defended buying the
Botero paintings by saying they would enhance the image of MAS as a
billion ringgit company.
But how does this tally with MAS trying to selling off its headquarters
building in Jalan Sultan Ismail? If you have sold your building, where are you going to hand the RM1.5 million painting? Surely not in an aircraft hangar in Subang? Munir Majid has also bent the truth about the
paintings. He said the budget for the paintings was approved two years ago.
This is untrue. He has also said that the paintings are a capital
expenditure, and do not add to the company's losses. But what about cash flow? How doyou pay for the paintings if not by using cash? Where does a loss making company get the RM1.55 million cash to pay for the paintings?
The budget approved two years ago by its then chairman, Tan Sri Azizan, was for other things like office renovations. However,when MAS was beginning to show red ink, he killed unnecessary expenditure and never spent those budgeted funds. Munir Majid has also exposed his bungling when he showed Union members the Botero paintings. He told the Union members that he himself had a collection of Boteros in his house, and said he authorised the purchase of Boteros from the same art dealer who soldhim his personal collection. This is clearly a conflict of interest.
When Tajuddin Ramli was flying MAS into the ground, he
got MAS to buy two multi-million ringgit luxury apartments in Kensington
in London, in the same building and from the same developer from whom
Tajuddin Ramli and his crony had also bought the same luxury apartments. If theywere any volume discounts for these purchases, who would get it:Tajuddin Ramli or MAS?
Likewise, when Munir Majid authorised the purchase of
the Botero from his personal art supplier, who would have benefited from
any discounts? Munir Majid or MAS?
But how did Munir Majid circumvent the MAS Board of
Directors? How did he get the paintings approved? How did Mazidah get
Christopher Andrews employed at RM7,250 a day? How was the IT outsourcing contractgiven to IBM? How does MAS Director Azman Yahya's ailing Symphony Groupbenefit from MAS' outsourcing? Simple! Create subcommittees to the MAS Board, and which has its full powers. Then these subcommittees make the important decisions and then get the board to rubber stamp them. One such subcommittee is the Board Strategy Committee, chaired by Munir Majid with Azman Yahya and Tengku Azmir as the members. The outsourcing and the hiring ofcon-sultans was approved by this Board Strategy Committee.
Azman Yahya's Symphony Group has benefited from some
of the outsourcing awarded by this subcommittee of which he is a member.
Neat, isn't it? For example, the con-sultan contract with Christopher
Andrews has been expended in a memo to the MD dated 7 January 2005 from MarzidaMohamed Noor, the Senior General Manager of Support Services. She tells
the MD, Dato' Ahmad Fuad Dahlan, that the Board Strategy Committee has
approved the support services, that with Christopher Andrews'
participation, she was able to tell the BSC that it had made right?choice. And that Christopher Andrews' contract 'shall be on a daily rate based on a month tomonth basis', the total cost 'shall not exceed RM650,000 (inclusive of tax) for the designated phase 1 of the work'. And she signed it. She makes
references to the Board Strategy Committee several times in that memo. How canthe MD refuse when the Chairman says yes, and overrides him? But in thisway, the MAS Board is sidelined, and is frequently no more than a rubber stamp.
But then it does not really matter because the MASBoard, stuffed with
Khazanah nominees and other no brainers, do not do anything about the
Engineering Mafia, Pilots Collective Agreements,accumulated man days
leave, C checks, Botero paintings, light bulb changes or anything at all.
In Engineering, there is something called the'Engineering Mafia'. These
are the engineers, mechanics and ground crews that are costing the company
millions of ringgit in overtime claims and shoddywork. They bum around
when they should be working, and start work only aftertheir day is over. So
they begin work only after they finish for the day, andclaim overtime pay.
Anyone who tries to genuinely work hard gets reprimanded by the Engineering Mafia. The situation is so bad that expatriate engineers become
indoctrinated into this cheating culture. MAS ends up paying millions in
overtime.
C checks are done sloppily on MAS aircraft. C checks
are the checks on simple and basic equipment and fittings on board
aircraft like light bulb or toilet flushes. MAS aircraft are even failing C checks
because MAS' Engineering Mafia does not even do the C checks properly. Delayed flights cost money.
MAS also had ground servicing agreements with British
Airways in London.
When MAS planes fly into London, the BA mechanics run
quick checks and replace faulty light bulbs. How many light bulbs does
BA change for MAS, and what do they cost? In London, MAS pays in sterling
pounds, and one sterling pound costs MAS RM7.00. But in Malaysia, the
Engineering Mafia allows work to be done overtime, and the work is not properlydone. So MAS pays BA to change light bulbs, and pays for it in sterling pounds!
When Munir Majid met the Unions to explain his actions, he tried to pull
the wool over their eyes. Until this news was exposed about two weeks ago, he flew free of charge by MAS first class from KUL to London almost every weekend. Munir Majid explained to the Unions that this was within his entitlement for free tickets.?But he did not tell the Unions that as Chairman he is only entitled to four free flights a year and not four free
first class flights a month!
Besides, first class flight attendants know that Munir Majid is a freeloader. He drinks in the MAS Golden Lounge. But he drinks most on board
the plane, where his favourite is Dom Perignonchampagne, which costs about
RM450 a bottle. They say they have to open a newbottle just for the
Chairman when he flies free at the weekend from Kuala Lumpur to London.
When he gets off the flight in London, he asks the flightattendants to 'ta pau'
for him any half finished bottles of Dom Perignon campaigme. Not only is
MAS a Flying Buffet; it also a Flying Bar, at least for
Munir Majid!
