Tuesday, June 17, 2008

RECAP : Privatised bodies not up to the mark

Letter of the day: Privatised bodies not up to the mark

The New Straits Times, 27 September 2000

THE privatisation programme has seen government agencies such as Tenaga Nasional, Telekom Malaysia, Pos Malaysia, Keretapi Tanah Melayu Bhd, MAS, Petronas and many others being privatised.The objective of the whole exercise was to improve efficiency and profitability of the agencies through less bureaucracy enabling self-dependency thus taking the burden off the Government.The privatisation of these agencies can be said as quite successful with some emerging to become large conglomerates reaping billions in profits every year.

All these companies inherited the infrastructure, assets, skilled manpower and expertise developed over the years by the Government which has put them in a strong footing to face the tough and challenging private sector.While some of the privatised companies face competition locally, they remain largely a monopoly in their respective sectors. With the advent of globalisation and the K-economy, their strength, efficiency and profitability will be put to test when free market systems are implemented.

Over the years the inefficiencies of these companies have been regularly highlighted and recently been prominently featured in the media for all the wrong reasons.We still hear complaints from the public of frequent power disruptions. The recent power disruption in the city should not have happened. Further disruptions, which are usually reported in the media, will erode public and investor confidence in Tenaga Nasional Bhd.The leadership crisis in TNB did not help either sending their share prices crashing in the recent weeks.

Telekom Malaysia Bhd too has seen a never-ending stream of complaints from the public on the inefficiency of their fixed line, mobile and Internet services.They are already unable to compete with two other local mobile telecommunications service providers. Although they are still the biggest, their competitors have been slowly increasing their market share and and if Telekom does not improve its services, the public will soon lose confidence and turn to others for better products and services.

Pos Malaysia Bhd's services is also not up to mark. It is baffling to hear of mail going missing, mail not delivered on time (although the destination of the receiver is in the same city or town), slow counter services and stolen mail.Although their intention to pursue e-commerce, announced recently, is commendable, Pos Malaysia should give priority to improving their services locally before venturing into bigger projects.

The worst among these companies seems to be KTMB. The frequent derailment of both goods and passenger trains are worrying. Their explanation that the railway tracks are old and needs to be replaced is unacceptable.KTMB should have anticipated this earlier and planned ahead to gradually replace the old tracks. Taking action after few railway accidents can be perceived as having no regard for the safety of passengers.Its train services are also very unreliable with many unexplained delays.

The complaints and incidents related to these privatised companies has become a norm in our daily lives. Malaysians seem to have no choice but to subscribe to their whims and fancies as some of them have absolute monopoly in their sector.Lately some of these large conglomerates seem unable to compete or face competition from local companies. Soon, when free market system prevails, only companies that provide quality services and superior products will survive.It looks like the Government, which has a golden share in each of these companies will have to be prepared to bail out our inefficient so-called conglomerates if measures are not taken to improve their quality of services.

K. BalanKuala Lumpur

Recap : Fast Forward 8 years, Nothing much has changed. They continue to be the monopoly in their respective sectors. KTM has certainly gone from bad to worse.

These companies had since introduced Key Performances Indicators (KPIs) and their progress against the KPIs, especially in financial terms, has been good. the same cannot be said about their services to customers. They are, while a big as some global conglomerates, still far off from becoming a world class service providers.

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