时势造英雄 Crisis makes a man

Rarely would anyone wants to break out of their comfort zones, some are willing and some are forced to make the break.

Crisis makes a man from the Chinese proverb "时势造英雄". Break out of the comfort cocoon that we build around us and set the inner beautiful soul free. I always try to see "uncomfortable" changes of event in my life as an opportunity to do things differently.

I feel strongly that I have an inner calling in me to amass a fortune through doing business or investments and help others in need with my finite life. It is this uncomfortable feeling struggling and this urge that made me stepped into finance from an IT background. My next life target is from owning businesses through investments ( Warren Buffett) to creating businesses.


"工字不出头” often people say but never take any actions. Dreams are just illusions without taking actions. I am taking small but forward steps towards my goal. With wealth, I can help others in need in more other ways.


Here is an intersting article I read from the Straits Times that I would like to share with my readers.


Cheers
Niversphere.


Original article from Straits Times by Tschang Chi Chu

China's second richest man built his billion-dollar fortune during China's construction boom in the late 1990s. Yan Jiehe bought over bankrupt state-owned companies and used modern management methods to turn them around. Now, he plans to give it back to his workers.

You could say that China's second richest man, Mr Yan Jiehe, would not have been today if not for the birth of his son.

The birth of the boy violated the one-child policy, which decreed that each family could have only one child to curb the country's population growth.

Faced with the penalty of being sacked, Mr Yan, who was a teacher, decided to quit instead. He was 26.

Mr Yan recalled his decision with a smile: "My son broke my rice bowl. If I hadn't had one more child. I could have enjoyed the carefree lifestyle of a teacher or principal."

So, instead of leading a bookish life he went into the rough-and tumble business of construction and succeeded in building his Nanjing-based company, China Pacific Construction Group, into one of the top construction companies in China worth more than 10 billion yuan($2 billion). Mr Yan is the largest shareholder in the company and is worth US$1.5 billion(S$2.4 billion) himself.

Not that the path to the top was smooth. When he quit his teaching job, Mr Yan knew little of the business world. He was the youngest of nine children and his parents were also school teachers. He was more comfortable reading the Chinese classics than doing things with his hands.

But he had a family to feed and he became a labourer to put food on the table. Being poor, he and his friends came up with a rather dangerous way of building up strength in their legs: they jumped off buildings.

"No one could beat me at jumping off buildings. We would start from the second floor and jump off. Then jump from the third floor. Then the fourth floor. All the way up to the fifth floor."

His big break came when a bankrupt cement company held a competition to get fresh ideas to save the company.

Mr Yan, who was the youngest and least experienced candidate beat out six rivals by receiving the highest score for a proposal to restructure the company.

He ran the state-owned enterprise for 10 years before leaving to start his own construction business in 1995. He scrapped together 100,000 yuan of his own savings and loans from family members to buy three nearly bankrupt township enterprises -- rural entrepreneurial ventures that sprung up along the coastal area during China's early days of economic reforms -- that grew into China Pacific Construction. The company has 100,000 workers on its payroll now, making it the largest privately-owned employer in China.

Mr Yan made his mark delivering his first project under budget and well ahead of deadline. In fact, he knew that China Pacific Construction Group would lose money on the project but he took the job anyway. The company was sub-contracted to pave a section of the highway encircling Nanjing. It was given 140 days. Mr Yan's team worked overtime and completed the job in 72 days.

He lost 80,000 yuan on the job. But his strategy paid off the next year when he won a bigger contract from the Nanjing government to pave another section of the same highway. He made an 8 million yuan net profit and has never looked back since.

Unlike many of China's millionaires, Mr Yan grants interviews freely. Since he was named as the second richest man in China, he has granted more than 100 media interviews.

He obligingly squeesing in the interview with The Sunday Times during a one-day business trip to Beijing.

The derring-do that prompted him to jump off buildings in his youth has served the entrepreneur well. When the Asian financial crisis slowed down China's growth in the late 1990s, the Chinese government started pumping in billions of yuan into big infrastructure projects such as highways, bridges, dams and airports, to keep the economy growing.

Mr Yan saw his chance and China Pacific Construction started bidding and winning a number of those contracts, including the Shanghai-Nanjing highway, the Shanghai-Beijing highway, the Nanjing Airport and Nanjing subway.

Another chance to score big came when the government decided to sell, merge or close down unprofitable state-owned enterprises. From 2001 to 2003, China Pacific Construction merged and acquired 31 unprofitable state-owned enterprises at the rate of nearly one every month in an effort to bulk up and expand nationwide.

Mr Yan says that in every case, the local governments approached him about buying out the bankrupt companies' orders.

At that time, few Chinese companies had China Pacific Constrution mix of capital, management and drive needed to restructure the unprofitable state-owned enterprises.

Mr Yan whose family was deemed "intellectual" during the Cultural Revolution and was sent to the countryside to work, learnt quickly to apply "capitalist" management methods. In a country which is trying to shake off the iron rice bowl mentality, he famously hired and fired three general managers of a bankrupt state-owned machinery company in five months before turning the company around.

The first general manager he bought in took care of the bottomline he laid off workers and sold off money-losing assets. He described the second biss as a "steadying influence" brought in to calm frazzled emplyees' nerves and bring the company for a "soft landing" after the radical restructuring. The third guy was an experienced manager who charted the restructed comany's direction.

Today, all 31 former state-owned enterprises have turned around and are profitable.

Given his wealth, he can more than afford to live larger than his current 170 sq m apartment in Nanjing but he is quite happy to stay where he is.

He said that every month, he hands over 80,000 yuan salary to his wife, who runs the household. His daughter is studying for a master's degree at Stanford University and his son is a college sophomore at the prestigious Nanjing University.

One thing is certain: his two children will not succeed him as company chairman. Indeed, he makes it a point not to hire family members, classmates and friends. When he took over as company chairman, his wife quit her job in the company's finance department.

He believes in keeping the business strictly professional. "A lot of talented management won't join a company if all the top management positions are held by the family."

He plans to retire from his post as Chairman in 2008 and has been reducing his stake in China Pacific Construction by rewarding his loyal staff with shares. Last year, he gave 40 percent of his shares to 250 senior managers. By the time he retires, Mr Yan will be left with just 25 percent of the firm.

He says that he will take his money and build a new business school in Shanghai to train China's next generation of entrepreneurs. "My first career was in education. I want to return to my roots."