All posts by Chee Shi

Is performance appraisal good or bad for companies?

Companies always do performance appraisal to assess the performance of their employees.

Most companies conduct performance appraisal once a year, and usually near the end of the year.

It is done supposedly for rewarding the employees for their performance over the year.

Companies will use this to decide on the increment of the employees and payment of bonuses .

So if an employee is judged badly in his appraisal, he will be penalized twice for his bonus, he will not get a good increment, neither will he get good bonus.

Worst case scenario will be he will not get any promotion due to bad appraisal, so he will be penalize thrice for bad performance appraisal.

So is performance appraisal the right tool to use to gauge and reward or penalize an employee?

Performance appraisal can be both good and bad, depending on how it’s implemented and utilized within an organization.

Here are some reasons why performance appraisal can be beneficial:

Feedback and Improvement:

Regular performance appraisals provide employees with feedback on their strengths and areas for improvement. This feedback can help employees grow and develop in their roles.

Goal Setting:

Performance appraisals often involve setting goals and objectives for employees, which can align their efforts with the organization’s overall objectives and help in tracking progress.

Recognition and Rewards:

Appraisals can be an opportunity to recognize and reward employees for their achievements and contributions, which can boost morale and motivation.

Identifying Training Needs:

Through performance appraisals, organizations can identify training and development needs for employees, ensuring they have the necessary skills to excel in their roles.

However, there are also potential downsides to performance appraisal:

Bias:

Appraisals can be influenced by biases, such as recency bias (focusing on recent performance), halo effect (allowing one aspect of performance to influence the assessment of other aspects), and leniency bias (rating all employees favorably).

Stress and Anxiety:

Employees may feel stressed or anxious about performance appraisals, especially if they perceive them as overly critical or unfair.

Demotivation:

If performance appraisals are not conducted fairly or if employees feel that their efforts are not recognized or rewarded appropriately, it can lead to demotivation and decreased morale.

Focus on Short-Term Goals:

In some cases, performance appraisals may encourage employees to focus solely on short-term goals that are easily measurable, rather than on long-term objectives that may be more important for the organization’s success.

Personal Grudges Elements

Normally, performance appraisal is done by the head of department on those staffs under his or her.

What happens if over the year, you as the subordinate, in the course of work during the year, had some clashes with your superior?

If the superior is a person who takes grudges to grave, you can be sure to have a bad performance appraisal even though you had performance brilliantly and contributed a lot to the company. 

 

Conclusion

Overall, the effectiveness of performance appraisal depends on various factors, including the organizational culture, the quality of feedback provided, the fairness of the process, and the way appraisals are linked to other HR processes such as training and development and rewards and recognition. When implemented thoughtfully and fairly, performance appraisal can be a valuable tool for employee development and organizational success.

Now, you might be wondering how exactly artificial intelligence (AI) can up the game when it comes to work performance. Truth be told, AI isn’t just about automating tasks; it’s about enhancing the quality of work we do on a daily basis. By taking over the repetitive and time-consuming tasks, AI gifts us the time to concentrate on more strategic and creative endeavors.

Take, for example, the role of AI in data analysis. AI algorithms are amazing at sifting through vast amounts of information quickly and accurately, way faster than any human ever could. It’s not just about speed though; it’s about making sense of the data. These sophisticated tools can spot trends and patterns that we might miss, leading to smarter business decisions based on hard evidence rather than gut feeling.

Let’s not forget the human-AI partnership, either. AI systems can provide real-time feedback and suggestions, proposing innovative solutions that perhaps wouldn’t have been considered otherwise. This symbiotic relationship paves the way for improved outcomes, elevating the performance bar in sectors ranging from healthcare to finance, from education to customer service.

And here’s the thing: as we lean more into AI, it doesn’t mean our skills become any less valuable. On the contrary, AI can boost our capabilities, encourage us to think differently, and push the frontiers of what we can achieve. Isn’t that something? Our focus shifts from mundane tasks to strategic thinking and innovation.

All these facets of AI’s intervention in our work lives lead seamlessly into the next big question: how can businesses, big or small, effectively harness the power of AI? That’s going to include not only the adaptation of current operations but also an understanding of how to merge the potential of AI with the irreplaceable value of human insight. But don’t worry too much about the ‘how’ – I’m here to guide you through it in the next section.

Navigating the AI Transformation: A Guide for Businesses

I’m here to help you with integrating AI into your business operations. It’s an exciting journey that’s going to include careful planning and strategic implementation. To start, you need to identify the processes within your business that are ripe for AI enhancement. Often, these will be tasks that involve data processing, repetitive actions, or pattern recognition – areas where AI excels.

Once you’ve pinpointed potential AI applications, the next step is selecting the right AI tools for your needs. There’s a lot of opportunity in choosing solutions that are tailored to your industry and specific business challenges. For example, retail businesses may benefit from AI-driven inventory management, while a financial firm might use AI for risk analysis and forecasting.

But integrating AI isn’t just about technological upgrades; it’s also about adopting a human-centered design approach. This means considering how AI systems will interact with employees and affect workflow. You can always adjust your approach down the road, but initial planning should prioritize user experience to ensure smooth adoption.

Moreover, measuring the impact of AI is crucial. Set clear performance indicators related to efficiency, accuracy, and cost savings. This will provide tangible evidence of AI’s value to stakeholders and help guide future investments.

If you want to ensure the success of AI in your work processes, you’ve got to involve your employees from the outset. Educate them about the benefits of AI and how it can make their work easier and more impactful. By doing so, employees are more likely to embrace AI and contribute to a positive transformation in the workplace.

Embracing Change Without Fear: AI’s Impact on the Workforce

Now, you’re going to find out about one of the most talked-about issues when it comes to AI at work: the fear of job replacement. It’s a legitimate concern, but it’s not the whole story. Artificial intelligence not only paves the way for efficiency but also enables us all to chase after the kind of work that’s uniquely human: creative, strategic, and deeply interpersonal.

As companies navigate the integration of AI, it’s absolutely crucial to align the transition with efforts to upskill their employees. From educational initiatives to hands-on AI collaboration, there’s an expansive toolbox available to make sure that everyone’s on board and no one is left behind. This isn’t just about keeping jobs. It’s about growing them and empowering employees to work smarter, not harder.

Creating a workplace culture that views AI as a partner, rather than a replacement, catalyzes a collective leap forward. When adopted thoughtfully, AI can free us from repetitive tasks, allowing more room for the nuanced, complex work only humans can do. Inviting employees to participate in the AI evolution fosters an environment where workers feel valued and engaged, and that’s a true measure of success for any organization.

In my opinion, the profound potential of AI isn’t in what it can do alone but how it synergizes with human intellect and creativity. Choose to see AI as an opportunity for your team to achieve more, elevate their work experience, and undoubtedly contribute to an enriched, more dynamic workplace.

I’ve seen too many people get excited over a job offer, only to find out it was a scam. It’s tough out there, and it’s important you know how to tell a real opportunity from a trap. Let’s talk about how to spot those red flags.

First off, watch out for jobs that scream urgency. It’s a tactic scammers use to rush you into a decision without giving you time to think. If a job advert insists you ‘ACT NOW OR MISS OUT,’ be wary. Real employers understand you need time to consider an offer.

Take a hard look at the job description. If it’s vague or promises incredible earnings with minimal effort, raise an eyebrow. Scammers often promise the world but deliver nothing. Legitimate jobs will have detailed responsibilities and clear qualifications.

Now, let’s get one thing straight. Legitimate employers do not ask for money or sensitive personal information before you’ve even started. If your ‘potential employer’ wants you to pay for training or special software before you’ve signed a contract, that’s a scam alert.

Remember, it’s not just about avoiding the trap. It’s about safeguarding your hard-earned money and personal data. In the next section, we’ll step into the world of job portals and social media, where many of these scams lurk, waiting for the unwary job seeker.

Navigating the Minefield of Job Portals and Social Media

Job portals and social media platforms are bustling with employment opportunities. Legitimacy, however, is not a guarantee on these sites. I’ll guide you through spotting deceptive job listings on even the most reputable job portals. A legitimate listing is typically detailed with clear expectations and requirements; anything vague or overly simplified deserves scrutiny.

Due diligence is your best defense when assessing job advertisements on social media. If an offer on Facebook or elsewhere seems too good to be true, it usually is. Take the time to look into the company’s online presence, check for a website, customer service contact, and reviews from employees.

Protecting your personal information is crucial. Share the basics required for a job application, but be wary if they’re asking for sensitive details too soon. A genuine employer will respect your privacy and follow a formal recruitment process.

Before you engage, verify the employer’s legitimacy. Look for official email addresses, contact numbers, and physical addresses. Cross-reference this information with what’s publicly available to ensure consistency. Only proceed if all signs point to a credible offer.

The Risks of Instant Messaging and Email Job Offers

Scammers have become rather shrewd, exploiting platforms like Telegram and WhatsApp to perpetrate job scams. These apps, known for quick and direct communication, oftentimes become a medium for scammers to spread false job promises. The risk lies in their personal touch; they can mimic conversations you would have with genuine employers.

Let’s now talk about the method in which these scams often unfold. You may receive a message with a job link, prompting you to apply or give away sensitive information. It’s crucial to remember that reputable companies avoid sharing job offers through such unsolicited messages.

Emails too are a favored tool for scammers. They might imitate legitimate businesses, even replicating company logos and signatures to seem credible. If you receive an email with a link to a job offer, inspect the sender’s email address carefully. More often than not, there’ll be subtle discrepancies revealing the email’s true nature.

When you encounter an unexpected job offer, you must exercise a high degree of caution. Start by investigating the legitimacy of the offer. Question its origin and look for public-facing contact information to verify its authenticity. Directly reaching out to the company’s official contact ensures that you’re not falling into a trap.

The truth is, not all offers that land in your inbox or message tray are malicious. However, it always pays to be vigilant. Use the company’s official website or HR contact to confirm the veracity of the position. Keep your eyes open for tell-tale scam signs: urgency, promises of high pay for low effort, and requests for personal or financial information.

In the next section, I’ll cover steps to bullet-proof your job search process. These strategies are essential to avoid the heartache of falling victim to job scams.

Developing Smart Habits for Securing Legitimate Online Employment

After delving into the murky waters of online job scams, I understand that staying afloat requires vigilance and informed action. I firmly believe in empowering myself to detect and avoid these treacherous schemes, ensuring I only connect with genuine opportunities.

A practical approach starts with constructing a robust checklist for job offer validation. This checklist should include confirming the employer’s contact information, seeking out reviews, and verifying job details against the company’s official site. It’s about cross-referencing every piece of information available, applying a healthy skepticism to offers that seem too good to be true.

Moreover, online resources like the Better Business Bureau or local job forums offer a wealth of information. They’re irreplaceable tools for digging into the credibility of companies. I also put a high value on my professional network; a quick inquiry among connections can often shed light on the legitimacy of a job offer.

If, unfortunately, I encounter a potential job scam, I now know it’s not just about steering clear myself. Reporting it is just as crucial to help dismantle these fraudulent operations and protect others. Various platforms have reporting mechanisms, and I shouldn’t hesitate to use them.

In summary, secure online employment is out there for the taking, but it requires discipline, research, and smart networking. By setting these smart habits in motion, I place myself in a position of strength, ready to discern and seize the right opportunities.

If you’ve been keeping an eye on tech innovations, you’re going to find out about blockchain technology sooner rather than later. It’s not just a foundation for cryptocurrencies like Bitcoin; it’s a groundbreaking way of recording information and transactional data in a way that’s designed to be secure, transparent, and tamper-resistant.

At its core, blockchain is a series of blocks, but not the kind you played with as a kid. Each block is a record of transactions, and once a block is completed, it’s added to the chain in a linear, chronological order. The decentralization part? That’s where it gets interesting. Instead of having one central authority, blockchain spreads its operations across a network of computers, making it incredibly difficult for one entity to have control or alter past transactions.

This isn’t just about making a quick buck on digital currency; it’s also about revolutionizing how we track and verify the exchange of assets, legal agreements, and even votes in elections. Real-world applications are already showing what blockchain can do, from supply chain management to international remittance, providing a glimpse at how it can transform various industries.

Now, as we’re considering the potential of blockchain to change the game, it’s vital to acknowledge the risks. That’s going to include being aware of scams and nefarious activities that often accompany new technologies. In the next section, I’ll guide you through the strategies to navigate these risks, ensuring that your foray into blockchain is as safe as it is revolutionary.

Navigating the Risks: Strategies to Prevent Scams in Blockchain

As blockchain technology carves its niche in various industries, it isn’t immune to the dark side of innovation: scams. It’s crucial to recognize that blockchain, while revolutionary, also presents new opportunities for fraudsters. I’m here to help you safeguard your investments and steer clear of these pitfalls.

I’ll start by shedding light on the most common blockchain scams, such as phishing attacks, fake ICOs (Initial Coin Offerings), and Ponzi schemes masquerading as legitimate cryptocurrency ventures. Learning the red flags—unrealistic returns promises, ambiguous team backgrounds, and inconsistent communication—can be your first line of defense.

I cannot overemphasize the importance of best practices for transaction security. Use hardware wallets, enable two-factor authentication, and always double-check wallet addresses. Remember, in the blockchain world, due diligence is not just advisable; it’s vital.

Regulations are somewhat of a contentious topic in the blockchain space—some argue they stifle innovation, while others believe they’re essential for user protection. However, as digital assets gain popularity, regulatory frameworks are bound to evolve. Knowing the legal landscape can be just as important as knowing the technology.

Lastly, equip yourself with knowledge. Subscribe to reputable blockchain news sources, participate in community forums, and keep an eye on guidance from financial authorities. Knowledge is power, and in the realm of blockchain, it can mean the difference between making a wise investment and falling for a scam.

Integrating Blockchain into Finance: Innovation or Hype?

As we unravel the complexity of blockchain, it’s clear that its capabilities extend far beyond the realms of digital currency. It represents a paradigm shift, introducing an era of decentralized financial solutions. The stories of enterprises successfully adopting blockchain are becoming more frequent, indicative of a growing trend.

However, with innovation comes skepticism. Critics point to scalability, energy consumption, and the steep learning curve as potential roadblocks. These challenges are not insurmountable, but they require careful consideration to ensure that blockchain can be a positive force in finance.

Looking ahead, the big question is whether blockchain can maintain its momentum. In my opinion, the trajectory is promising. As companies continue to pilot blockchain projects and refine the technology, we may soon see a more secure and transparent financial ecosystem emerge. True, your first attempt at using blockchain in your financial dealings doesn’t need to be your last; there’s room to learn and adapt.

Taking a step back, it’s not just about the technology itself, but how it can be leveraged to create value. Blockchain’s potential to revolutionize aspects of finance hinges on the collective willingness to adopt and adapt to its strengths and shortcomings. Choose something that resonates with you, whether it’s heightened security, increased transparency, or the sheer novelty of the technology.

Blockchain has indeed carved out a significant niche in the financial sector, and there’s a lot of opportunity in this space. A lot is happening very quickly, and staying informed is key. I really hope that you venture into understanding and using blockchain with both curiosity and caution, as this could be the start of a journey towards a more innovative financial future.

In the ever-evolving landscape of entrepreneurship, a well-structured business plan remains the cornerstone of success. Whether you’re launching a startup, seeking investors, or steering an existing business toward growth, a meticulously crafted business plan serves as your roadmap. It not only outlines your objectives but also delineates the strategies and tactics necessary to achieve them. In this comprehensive guide, we’ll walk through the essential components and steps to create a robust business plan.

Executive Summary:

The executive summary encapsulates the essence of your entire business plan. It provides a brief overview of your business concept, target market, competitive advantage, financial projections, and funding requirements. While it appears at the beginning of the plan, it’s often written last to ensure it accurately reflects the content of the document.

Business Description:

Here, you delve into the specifics of your business. Outline your mission statement, vision for the company, and the problem your product or service solves. Describe your industry, target market, and the unique value proposition that sets your business apart from competitors.

Market Analysis:

Conduct a thorough analysis of your industry and target market. Identify trends, market size, growth potential, and key competitors. Understand your customers’ needs, preferences, and behaviors. This section should demonstrate a deep understanding of the market landscape and how your business fits into it.

Organization and Management:

Detail the structure of your business, including the legal structure, ownership, and key personnel. Highlight the skills and experience of the management team and any advisory board members. Investors want to know that your team has the expertise to execute the business plan successfully.

Product or Service Line:

Provide a comprehensive description of your offerings. Explain the features and benefits of your products or services and how they address the needs of your target market. If applicable, discuss your research and development process and any intellectual property protections.

Marketing and Sales Strategy:

Outline your plan for attracting and retaining customers. Define your marketing channels, pricing strategy, and sales approach. Consider how you’ll position your brand in the market and differentiate yourself from competitors. Include a sales forecast that outlines your expected revenue streams.

Funding Request:

If you’re seeking funding, clearly articulate your funding requirements. Specify the amount of funding you need, how you’ll use the funds, and the potential returns for investors. Provide realistic financial projections to support your funding request.

Financial Projections:

Develop detailed financial forecasts, including income statements, balance sheets, and cash flow statements. These projections should be based on thorough research and realistic assumptions. Investors will scrutinize your financial projections to assess the viability and scalability of your business.

Appendices:

Include any supplementary materials that support your business plan, such as resumes of key team members, market research data, or legal documents. While not essential for all business plans, appendices can provide additional context and credibility.

Review and Revise:

Once you’ve drafted your business plan, take the time to review and revise it thoroughly. Seek feedback from mentors, advisors, or industry experts to ensure it’s comprehensive, coherent, and compelling. Update your business plan regularly to reflect changes in the market or your business strategy.

Crafting a business plan is not a one-time task but an ongoing process that evolves as your business grows and the market shifts. By following this comprehensive guide and investing the necessary time and effort, you’ll create a roadmap that guides your business toward success. Remember, a well-prepared business plan not only attracts investors but also serves as a strategic tool for decision-making and execution.

Conclusion

Do you need a business plan, if you do, you can reach me to discuss.

We provide this type of service to suit your business need, be it a plan to secure financing facility, a plan to expand your business or even a plan to pitch for investors.

Maintaining Full Staff Force While Cutting Costs: A Strategic Approach

• Understanding the need to cut costs without reducing staff force
• Strategies for improving staff skill set and productivity economically
• Innovative ways to remunerate staff without increasing financial strain
• Fostering staff loyalty as a cost-effective measure during financial crises
• Balancing a lean staff force with maintaining efficiency in operations

A. Understanding the need to cut costs without reducing the staff force.

normally a lot of businesses during the downturn, face a lot of pressures, the first thing they will do is to cut cost in order to survive the down turn.

Most businesses know surviving the downturn need to cut cost, however, do they do the right thing in reducing cost?

A lot of time, businesses just cut the head count, as the cost cutting is very obvious and immediate.

say you have 100 staffs, and if you reduce the staff force by one third, that mean you lay off about 35 staffs, you save at least 100,000 per month in term of salary.

However, the issue most businesses seem to overlook is the cost involved when situation get better and you need to get more staffs in.

The opportunity cost is the one every one seem to overlook.

B. Strategies for improving staff skill set and productivity economically

instead of laying off workers during the downturn, businesses should try to improve the staff skill set and productivity economically.

during the down turn, since business will be slow, this is the time to send the workers to improve their skill set.

it is also the time to see how to increase the productivity of the workers.

by sending them to train, and help them improve, the workers will appreciate the businesses effort, and will be grateful that the business take care of their welfare in time of challenging business environment.

if the workers are appreciate and grateful, they will learn more and help the company to tie over the down turn.

C. Innovative ways to remunerate staff without increasing financial strain

If a business is innovative, it will find a way to remunerate the staff without increasing the financial strain of the company.

one of the best way to reward the staffs is to make them feel wanted and appreciated.

Perhaps the company can consider giving some shares to the workers and this way, they will feel since now they also own some shares of the company, they will put in more effort and productive output.

AS no one wants to lose whatever he owns.

D. Fostering staff loyalty as a cost-effective measure during financial crises.

How to foster staff loyalty as a cost effect measure during financial crisis?

a lot of businesses may think it is not worth any effort to do so.

Loyalty of staff nowadays does not seem to be in the mind of the employees.

if you look at the trend nowadays, a staff staying at a company, the most is 2 years, seldom you see a worker stays in one company for more than 5 years.

Likewise, employer is not willing to invest so much in employees welfare as employer thinks it is not worth the effort at all.

Employers seem to have the impression that if they invest in employees, they are only helping others to train the staffs.

so how do we foster staff loyalty?

As mentioned above in C, one of the way is to have employee share option scheme,

Respect and trust work both way, if employer does not think employee is worth investing, employee will think no worth to go all out to do his job after all his effort is not appreciated.

Especially during financial crisis, if the employees feel that there is no security in their jobs, they will not show their loyalty at all, as the threat of anytime they will lose their job will put them under undue pressure.

If every day you have this threat hanging over your head, will you be able to be loyal to the company you are working in?

E. Balancing a lean staff force with maintaining efficiency in operations

A lean work force with efficiency in operation is the challenge companies are facing nowadays.

Unless the bosses are willing to work the ground and find out what actually happening in their operation, they will not be able to understand the workers on the ground are facing.

Some management only know in theory lean work force equal low cost in operation.

However do they know lean work force may also be stressful for the workers at the ground level who may need to work overtimes to finish their job.

Are you able to balance this lean work force and efficiency in operation?

Do you really understand the processes and what kind of work force is required in order to achieve the target set?

Most management will take the easier way out by cutting work force, they do not care how the left behind work force complete the job. all they are interested in the result.

Without knowing the process, only emphasis on results, in the short term, it may look good, in the long run, the bad effect may surface.

One of the bad effect will be the staff will be leaving, when he reaches his breaking since he has increase work load and not properly compensated for his output.

In the short term, he may just take it and work on, after he reaches his breaking point, he will realize it is not worth putting the extra if his health and family life is affected.

After all, money is not ever thing, the most important is you may earn good money, the issue is do you have the luxury to enjoy the money you earn.

You will find that al the money you earn is to buy the health you are craving for.

In conclusion, is there any business out there which really care about the welfare of the staffs or they are just chasing their bottom line and please the shareholders only?

Environment, Social and Governance, the three words now in most of the Board of directors mind.

Whether they know what these three words entail and cover and what need to be done is another matter.

So What is Environment, Social and Governance or commonly known as ESG?

The whole business world is talking about ESG and every company jumps onto the bandwagon.

Whether they really care or not is another matter, as long as the public see they produce long reports at the end of the year in their annual report especially those public listed companies, that mean compliance with the listing requirement.

In Singapore case, that means they comply with SGX listing requirement in terms of reporting.

Does the authority really check whether the companies comply with the requirement?

Or is it another publicity stunt done for the sake of showing compliance.

Businessmen will tell you ESG will increase their cost of operation, therefore, to comply with it, they need additional fund to do so.

Now on Environment.

Nowadays every one cares about the earth and trying to make sure climate change impact is at the minimum.

The big question is – is every one serious about this issue? environment?

Nowadays public listed companies are required to produce in its annual report on sustainability and diversity disclosure in the annual report,

So, does it help in improving the climate changes and save the EARTH?

For those who like to print the annual reports in hard copy, that mean more pages on the annual reports.

More pages in the annual report mean more papers being used to produce the annual report.

With the increase in pages in the annual report, the paper manufacturer needs to produce more papers, then they have to cut more trees in order to produce more papers.

So much for sustainability of environment.

The next question is whether the board members know what they are supposed to do on ESG?

It will be interesting to know as we can notice most of the independent directors on boards are not that equipped in the subject matter.

Every good learning issue start from home.

If we want to do good, we have to start somewhere.

Therefore, to really deal with ESG, every one needs to put in his share of the work.

People nowadays have the habit and mentality of this is no my problem, it is the responsibility of the authorities and the government of the day to take care of the environment issue, and in the broader sense, ESG.

Carbon emission is one issue which affect the climate.

So can the directors go to meeting without taking a motor vehicle?

walk up the stair instead of taking the lift, since lift use power to get it moving.

And the power is from power station which is using coal, fuel, diesel to generate, and the emission of carbon is an issue.

Now on the Social issue.

Most of the time, if you ask a company to shoulder social responsibility, they will just tell you the bottom line is more important.

The motto of we must achieve a positive bottom line at all cost is more important than anything else.

So now companies need to take care of the Social factor in the ESG.

What do the companies need to do in term of Social factor in ESG?

the Social factor is about how the company manage its relationship with its employees as well as the community in which it is operating.

The relationship between the employer and employees are evolving, especially in the last few years at the height of the COVID 19 pandemic.

How a company treats its employees, inspire the employees, up skill and engage the employees go a long way to decide whether the employers are able to retain the employees.

Nowadays employees will look at how the employers take care of the staffs to decide whether it is worth to continue working in that environment.

People are more aware of the surrounding and working environment especially after going through the pandemic.

Employees now more likely choose to work with an employer who has social responsibility and showing more humane touch.

Those whose main objective is to make as much as possible at the exploitation of the staffs will find difficulty in keeping good employees.

Therefore, to drive ESG forward, human capital is the main contributing factor, and driving force to determine whether your effort in achieving ESG target is reachable or not.

now let talk about governance.

Most people have an impression that governance is just making sure every thing is done according to the rules and regulations.

Actually governance entail larger area than this.

Having a strong governance structure allow a company to ensure its business ethics and transparency are more visible and can reinforce trust in its leadership.

If a company is able to put in place a good governance policies, this will make the Board executing its fiduciary responsibility easier and at the same time, this can also help to manage the cost of operation.

Most people do not realize a good governance can help to reduce cost of operation.

When facing hard time, most businessmen like to take the easy way by cutting the staff force, instead of finding ways to reduce cost other than the human cost.

Cutting human capital must be the last resort for a company facing hard time.

Unfortunately, cutting human capital is the first step most businesses do when facing hard time.

By doing so, they seem to have forgotten the ESG factors.

This is what I said earlier, a lot of ESG measures are just for show, merely to satisfy the government requirement, how it is implemented, does not matter at all.

After all, is there any penalties for not compliance with ESG?

How importance is human capital for an organization?

Businesses need to look at the followings if they really care about human capital:

1. staff turnover.
2. Staff development.
3. Occupational health and safety.
4. Gender diversity
5. age based diversity
6. training
7. staff welfare and benefit.

If an organization fails to give the staffs a sense of belonging, it will not be able to hold on the staffs, especially those good staffs.

Sadly most bosses do not seem to understand the importance of human capital,

human capital as intangible assets have value shown in the financial report, if the bosses can understand the importance of it, then the ESG will be implemented properly and effectively.

In conclusion, ESG is here to stay and companies need to pay more attention to it.

With the recent problem of liquidity in cryptocurrency, quite a lot of people have their live savings wiped out.

So are we seeing the end of the crash?

Or we have not seen the end of the collapse?

For those who are heavily in cryptocurrency, there are lessons we can learn.

If you read the financial news in the last few weeks or days, all we encountered were shortage of liquidity in the crypto exchange.

One of the biggest exchange based in Singapore had to go into liquidation, after the Monetary Authority of Singapore reprimanded them for giving false information last month.

As the result of which, that crypto hedge fund plunges into liquidation and we are yet to see the financial impact.

For the l;last few weeks, the global digital assets’ sector is facing strong head wind after breakneck speed of growth.

Due to the breakneck speed of growth, a lot of investors decided to jump into the bandwagon and ride on the wave.

During the last few years, the growth of the global digital assets’ sector was amazing, a lot of cryptocurrencies exchanges platform were up and running.

However, no one seemed to care there was a serious lack of regulation to monitor and regulate the transactions in cryptocurrencies transactions.

How do we know which exchange platforms can be trusted?

There are so many cryptocurrencies exchange platforms nowadays, and there are also so many types of cryptocurrencies on the market at the money.

There are too many until one can not decide which one is the one we can rely on.

Are they regulated and by whom?

though governments all over the world tried their best to regulate cryptocurrencies, the problem is there are too many exchange platforms pop up everywhere and each claimed its own legitimacy.

Without knowing the full details of the one who is running the exchange platform, and just base on friends’ recommendation just because he or she has been using the platform, then the cryptocurrencies hype grow.

We will only know there is a problem when someone who tries to cash in and liquidate his position find out he is not able to do so, or the money he tries to cash out does not seem to come into his bank account promptly.

Then when he tries to call, then only realize you can only do so by contact the exchange online, the reality sinks in when he realizes that he is dealing with machine or robot.

Evolvement of cryptocurrencies.

Cryptocurrencies were supposed to be the alternative for money currency and note.

Instead of using monetary note to purchase goods and for consideration,

Cryptocurrencies especially Bitcoin, when it first started, it was supposed to replace the normal money note as the consideration of exchange of goods or services.

However, somehow it seems it became an investment instrument instead of the alternative of money notes.

Bitcoin has fallen from the high of US$67,000 to its current level of US$ 20,000.

The collapse of cryptocurrencies caught investors by surprise, and people are wondering whether we have seen the bottom of it.

is it the same as the crash of the DOTCOM case in the 2000?

The dotcom crash was due to the rapid rise of the US technology stocks fueled by the investments in internet based companies in the late 1990s.

The internet based companies hype made opportunists investors jumped on the bandwagon and rode to richness, so they thought.

Then the reality sunk in and the bubbles burst, especially when the element of speculation came into play.

So it seems we are seeing the same thing for cryptocurrencies hype, every one is rushing into this sector just like in the late 1990s.

At the beginning, we only had Bitcoin, then when people saw how fast Bitcoin value rose, investors rush in and companies being formed and new cryptocurrencies being issued.

Now there are so many times of cryptocurrencies, resulting in so many choices for investors.

It seems that history is repeating itself, with people rushing to form new cryptocurrencies and so on, just like the DOTCOM case when every one rushed to form new start up and so on.

During the DOTCOM crash, we had a lot of venture capitals funding the new startups, the same thing is happening in this cryptocurrencies case.

With capital markets throwing money in this sector, the game is very much different and every one is rushing to grow big and trying to capture the market.

It resulted in we are not able to identify which is speculative and which is genuine investment.

to make the matters worse, scammers also dip their hands into this and make some killings for their own purposes.

So, do we still invest in cryptocurrencies?

Just like the DOTCOM incident, after raining, sun shine.

Those who have the lasting power or having some extra in the reserve, can wait for the storm to blow over and start investing again in this sector.

Hopefully by then a proper regulatory body is in place to make sure proper accountability and transparency in this sector.

Perhaps, something along the line of stock exchanges like the DOW JONES or other exchanges, where you want to have your counter listed, you must go through certain scrutiny and meeting some strict criteria, then only the cryptocurrency is allowed on the exchange.

Then perhaps we need to have a proper exchanges instead of what we have where anyone who has some extra can form an exchange and allow trading on its platform.

The most thing to bear in mind is to eliminate the speculative investment in this sector and also filter out the scammers.

Anyone who wish to share his experience in this sector, please feel free to put in your experience in the comments section below.

COVID – 19 and its impact
For more than two years, businesses all over the world faced the impact of COVID-19 pandemic, and the chaos it brought upon all of us.
IN the last two years or so, every way we saw the business needed to shut its door, as government gave the order that to do so.
This was an effort to contain the spread of the virus.

Every one was encouraged to stay at home.

The main objective was to stop the transmission of the virus in crowded places.
Due to this measure, a lot of businesses need to stop operation.

A lot of workers were lay off, some lost their jobs due to cash flow issue.

While others lost their jobs because the owners were not able to sustain the business operation.

The reason being the operation has zero income.

Government effort to ensure zero cases of COVID-19, resulted in a lot of businesses having zero income. so is this trade off a good measure?

Luckily most governments decide

1. to ramp up the vaccination processes,
2. come to their sense to live with the virus, and
3. slowly opening up the economy again.

Are you ready to face the challenges of the re-opening of economy?

Some businesses, while during the isolation and tough measure of government in containing the spread of the virus, were taking measure in preparation of the re-opening of the economy.

• the smart one would have reviewed, and made changes in their business operation.
• Some start the automation of some of their processes.
• Others decide to divert to some other more sustainable businesses,
• more in tune with the demand and requirement of the new normal.

What are the  consequences of business not in operation for more than two years?

1. Lose of good workers.

Due to the slow down in business, companies in managing cash flow, most of them will just lay off their workers, so with skeleton work force, now with the opening up of the business, new workers need to be recruited.

One good example I noticed in Singapore was the fast food chain – McDonald.

They seem to be going round to try to recruit staffs in anticipation of business on the upward turn, now that the government has decided to relax the rules.

2. Cost in training the new recruit.

I spoke to one of the McDonald manageress, she said the new staff needed training and obtained the necessary food health handling certification before he or she can start the work.

That mean cost is involved.

3. Take time to recruit new staffs

If a business only starts its recruitment now following the government announcement of the opening of economy and live with the virus, by the time you manage to get the new staff on board, it will be another month gone.

Then the new staff needs to get acquainted to the new work environment and the way how the new company work.

4. Machinery need to be maintained.

During the two years shut down, some of the machinery might not be in working condition.

And now need to restart,

• the company need to carry out maintenance, and
• services to ensure the machineries are in tip top condition.

5. Looking for new office space.

Some companies might have given up the extra work space during the two years closure.

Now with the re-opening, they have to look for new work space, hence need o incur extra cost

Did you do some preparatory work during the two years scaled down operation?

Some managements have foresight, while waiting for the economy to open up again, they have already gotten their plan in place.

So once the economy opens up, they can hit the ground running, and getting business in as others are just about to do the necessary adjustments to face the new normal.

One good example is Changi Airport.

Once the government announced the opening of the boarder, they just hit the ground and run.

We can see from the data, in the first quarter of the year 2022, the numbers of human traffic and cargo passing through Changi Airport.

The news reported that Changi Airport had the highest in both categories among all the airports in the region, or even in Asia, beating Hong Kong.

Businesses good at adapting and innovating, will have not problem in operating in the new normal.

During the two years, we see what are the businesses which can survive any crisis or emergency shutdown.

If the business operators can make the necessary adjustment, and implement the changes, there is no reason the business can not grow and improve.

Conclusion

Good management will always innovate, adapt and make necessary adjustment to face the challenges.

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We have covered the importance of cashflow and the differences between revenue and cashflow.

Also we noted what we needed to do in preparing a cashflow forecast.

Now we want to cover the most important part on managing cashflow effectively.

In managing cashflow, we want to make sure we have surplus cash available all the times.

Ways of ensuring effective cashflow management.

1. Monitor the cashflow forecast closely.
2. Ensuring billings are done promptly.
3. Fully utilize the credit term given by the suppliers.
4. Take advantage of the government incentive schemes.
5. Keep minimum inventory.
6. Implement effective debt recovery and collection.
7. Review expenses regularly.
8. Maintain a good financing line of credits.
9. Cash in on the discounts offered by suppliers.
10. Demand for deposit for big sales contract.

 

1. Monitor the cashflow forecast closely.

When we have the cashflow forecast, we usually notice the following scenarios:

• We forecast a positive cashflow.
• control of payments over a period of time.

So, in reviewing the cashflow, be it a weekly cashflow or a monthly cashflow, we will compare the actual and the forecast.

Since we always forecast a positive cashflow, we will not have to worry if the following work out:

a. the actual inflow of weekly cash in more than that forecasted. (assuming we are doing weekly cashflow).

b. the actual outflow of weekly cash is less than that forecasted.

if the above two scenarios play out, we are very sure that we will have cashflow surplus.

Reason being since we already forecasted a positive cashflow in which the cash inflow is more than the outflow of cash, therefore if the actual inflow is more than forecasted, and the actual outflow is less than forecast, we will have super positive cashflow.

On the contrary, if the actual inflow is less than forecasted and the actual outflow is more than forecast, then we need to review and find out the reasons.

Hence, by monitoring the cashflow closely ,we are able to take remedial action promptly, and rectify any weaknesses in operation immediately.

2. Ensuring billings are done promptly.

No billing means no payment by buyers, and no payments by buyers, we will run into cashflow issue sooner or later.

To ensure the inflow is not disrupted, we have to ensure our billings for work and services done are sent out immediately the moment work or service is done.

3.Fully utilize the credit term given by the suppliers.

a good business will take full advantages the credit terms given by the suppliers.

This is basic good cashflow management,

The main idea is – don’t pay the suppliers promptly and make sure debtors pay you quickly, that way you will not have any cashflow problem.

Sadly a lot of times, we see the opposite happen.

Bosses in their efforts to get in good term with suppliers, will instruct to pay the suppliers promptly, usually even before the end of the credit period.

And some bosses did not even bother to chase the customers to pay up fast, worry by doing so, will offend the customers, and this makes the finance staffs’ job more difficult.

4. Take advantages of government incentive scheme.

A good management will always take advantages of the government incentive schemes available.

Government such as Singapore government always has some good incentive schemes to support the businesses, especially the small medium enterprises.

So, to have a more effective cashflow, it is quite useful to take advantages of the schemes.

5.  Keep minimum inventory.

This may be arguable for some people, for me I am not one who favor keep a lot of stocks.

Having less stock mean the holding cost will be lower, and less space required to keep all the stock items.

This in a way , will not hold up the cashflow.

However there may be a different school of thought especially after the post COVID-19 situation, that depend on what industry you are in.

For manufacturing outfit, keeping raw materials at certain level may be a good idea but excessive inventory? I doubt that is the way to manage the cashflow.

 

6. Implement effective debt recovery and collection.

Debt collection and recovery are very important for a business’ cashflow.

If a company has a lot of bad debts or long outstanding debts, this will affect the cashflow.

If the finance department is not able to ensure the debts outstanding is within the credit terms given, then it is about to review the debt collection system of the company.

7. Review expenses regularly.

Management should take time to review expenses regularly.

Especially when the weekly cashflow forecast vs actual analysis is done, any obvious signal of expenses deviation need to be investigated and assessed.

By reviewing the expenses, if the management can do away with some of the unnecessary expenses, it will go a long way in helping to improve the cashflow of the company.

8. Maintain a good financing line of credits

Though the company may be in good healthy cashflow position, it does no harm in having a good financing line of credits standby in case of emergency.

With the readily available financing line of credits, it will not be a stress but it does not mean the company can simply go out and spend lavishly.

Having the line of credit readily available is just some sort of insurance for the operation.

9. Cash in on the discounts offered by suppliers.

Suppliers may offer some discounts for the business, and any company which operate on prudent cashflow management, will definitely take advantage of that.

To some extent, the discounts offered may offer the business some help in the cashflow position, all the more crucial during the challenging time like now.

10. Demand for deposit for big sales contract.

whenever a company has a big contract or order, it is good that it can get some deposit from the buyer, this will ease the cashflow of the business in fulfilling the orders.

it will be even better if the company can arrange installment payment from the buyers.

Conclusion.

Staying on top of the game in term of cashflow management is vital to the success of a business.

We should not let some missteps and miscalculation disrupt our cashflow management.

Take immediate action and rectify soonest possible, and you will not have to worry about cash crunch.

Always remember, take action, no matter how painful the action may be.