Kuok’s business philosophy

SURPRISINGLY, Robert Kuok's business philosophy is largely people-centred. In Robert Kuok, A Memoir the Malaysian billionaire offers several maxims:

» understand human nature;
» nurture long-term relationships rather than immediate profits;
» prioritise employees' welfare above that of guests;
» focus on potential employees' character rather than academic qualifications; and
» consult individuals who are cleverer to avoid making mistakes.

Although Kuok subscribes to the Chinese belief "failure is the mother of success", he believes the reverse is truer today: "Success often breeds failure, because it makes you arrogant and incautious".

Kuok gives greater weight to an employee's character rather than academic qualifications.

"I do not look for MBAs or exceptional students. You may hire a brilliant man, summa cum laude, first-class honours, but if his mind is not a fair one or if he has a warped attitude in life, does brilliance really matter?" Kuok asks.

One example highlights Kuok's preference for nurturing a long-term relationship rather than focusing on short-term gain.

In 1963, Indonesia's Gula Negara requested amending the terms of a sugar trade. If accepted, this proposal would reduce Kuok's profit on 10,000 tons of Java raw sugar from £20,000 to £15,000. Kuok was willing to accommodate this request because Gula Negara sometimes gave him "offers well over and above normal commercial terms".

"Legally, we could have said no, a contract is a contract. But, in Asia, you don't trade only on the basis of legal documents, you trade on give and take and you place great value on friendship," he wrote.

Because Allan Arthur, a director of a British sugar trader Woodhouse, Drake and Carey, insisted on sticking to the contractual terms, Kuok angrily informed the former this was their last deal.

Although Kuok never studied hotel management, he says travellers have three basic requirements: a comfortable bed, a good bath as well as good food and beverage outlets within a hotel.

Kuok outlines his three-step hotel management strategy, in this order: "To look after our hotel staff; to look after our guests; to look after our shareholders."
By treating hotel staff "as fellow human beings, (and by not behaving as lords and masters) – we motivate them to provide the best service to the guests, our customers. If we do everything sensibly, we end up rewarding our shareholders with good profits from which we can pay decent dividends."

When doubtful about a project, Kuok employs a neat tactic. "I chat with a man cleverer than myself and offer him a joint-venture deal." This ploy prevented Kuok from building a Shangri-La hotel near a Bangkok bus terminus in the late 1970s.

Before the bidding, Kuok consulted the late Suree Asdathorn, a leading Thai sugar miller and exporter. Noise, smoke and pollution from the bus terminus made the proposed site unsuitable, Asdathorn advised. A better location for Shangri-La was on the banks of the Chao Phraya River – advice that Kuok accepted.

Kuok's memoir is puzzling in two respects. First, he doesn't explain the business rationale for buying and selling on March 2016 a controlling interest in the Hong Kong publisher of the South China Morning Post daily newspaper.

Kuok believes "an independent media is a crucial component of a fair and orderly society" and in the permanence of print in recording daily events. When asked how he felt about disposing of a newspaper he had owned for 24 years, he said "Phew!"

Second, his stand on nepotism appears inconsistent. In his memoir, Kuok wrote if he "ever started a company, there would be no nepotism, no weakness" because "in a company, discipline matters".

Yet the Kuok Group employs several relatives. Although his work was deemed unsatisfactory, Kuok hired this kinsman twice and on both occasions was forced to let him go.

Why did he employ this kinsman? Was it because this kinsman's father's share in Kuok Brothers was equal to that of Kuok? Or was it because this kinsman's father was the brother most loved by Kuok's father?

In the memoir, Kuok described Khoon Hong as "a businessman who was at least as able as myself" and "the most capable Kuok ever". Khoon Hong resigned from the Kuok Group in 1991; a departure precipitated by Kuok informing his cousin's son that it was difficult to pay a bonus that year because there were no profits, Kuok said, due to the wrong strategy adopted by Khoon Hong in trading sugar.

Khoon Hong's success in establishing and expanding Wilmar prompted Kuok to initially take a stake in the Singapore-listed company and later to merge their respective entities.

One question Kuok doesn't ask, let alone answer: Is Kuok the banyan tree under which nothing grows? Would Khoon Hong have flourished if he had remained within the Kuok Group?

Perhaps the memoir isn't intended as a tell-all but a partial and tantalising show-and-tell.

Opinions expressed in this article are the personal views of the writer and should not be attributed to any organisation she is connected with. She can be contacted at siokchoo@thesundaily.com