ADVERTORIAL
The Sarawak Land Consolidation and Rehabilitation Authority (Salcra) was in the red when Datu Vasco Sabat Singkang took over as the general manager in October 1997. Prior to that, he was seconded to Salcra as its financial controller in February 1996.
According to Vasco, many did not realise that Salcra’s financial management back then required some expert advice to get the financial statements prepared on time. It did not table their annual audited financial statements from 1989-1995.
Vasco was thus tasked with completing the exercise and to get the accounts audited and tabled to the relevant authorities for approval.
As a chartered accountant he quite understandably found the figures far from flattering and was, in fact, rather shocked but he remained single-mindedly dutiful to balance the books.
“Because figures don’t lie and the staffs need to be paid, I have to do what I have been tasked to do,” he reminisced.
At that time, Salcra’s cash flow was low, compounded by mounting debts. But since he had been entrusted by the then Sarawak government to turn the land agency’s debt-ridden situation around – which to some, looked like mission impossible — he resolved to first prove he was up to the daunting task and secondly, to justify the faith of his new ‘bosses’.
Having served in both public and private sectors at various executive levels before his appointment, Vasco’s ‘tengik’ philosophy — similar to a never-say-die attitude — steeled him to the task at hand, unflinchingly confident that if others could do it, so could he.
It was then that he introduced and carried through his policy of good governance, committed to creating a system, founded on fiscal and financial transparency and sound money management to maximise returns and avoid wastage.
“I’m one of those very strict on good governance. We never paid anybody more than what they could actually deliver,” stressed the British-trained chartered accountant.
Vasco, who retired on Dec 31, 2019 after 24 years of dedicated service, inculcated in both his staff and the landowners the overarching importance of increasing productivity and yield to ensure a better future.
Challenges
In the early years after Vasco took over, the discipline and morale of the agency’s staff were low. They would come to the office late and clock out early. And while they were supposed to work, they were not pulling their weight with a ‘tidak apa’ (nonchalant) attitude, preferring to chit-chat and fritter away time.
Vasco knew something drastic was needed to put the house in order and left with no choice, he had to get tough by telling his staff to buck up or ship out.
“Actually, I wasn’t that cruel as to fire them. But I had to do something — like finding ways to re-assign them to the jobs that suited them best.
“Over time, with hard work, patience and perseverance, it worked but not without my methods being called ‘mangah’ (fierce in Iban),” he recalled.
“But the results are well worth it. Now, Salcra has a headquarters in Kota Samarahan and there is so much commitment during working hours. Gratifyingly, the staffs have picked up a good work culture to focus on productivity.
“Every level of this building has a pantry. It will minimise their movements for breaks and lunches. Even though we have a cafeteria on the ground floor, they will go there only during lunch break.
“No unnecessary movements of people during working hours. No office chit-chatting. This is very basic in management where good ethics and discipline prevail.”
Salcra now employs about 1,000 staff and 4,500 estate workers either on contract or pensionable scheme but, there is a number of new staff who prefers the Employees’ Providence Fund (EPF) scheme.
Vasco also made the bold move to “computerise” Salcra and its entire staff in an earnest effort to modernise and transform the ailing government-link company.
“With that exercise, everybody had his or her computer, except for two who were retiring. What this means is computerisation entails modernisation and with that, everyone will have to work on his or her given tasks. That’s one of the best things we have done together,” he enthused.
With increased productivity, revenues naturally also spiked with a concomitant reduction of expenses for medical bills and transport maintenance — which, at one time, ran into a few million ringgit annually. Gradually but surely, Salcra managed to slash these overheads by more than half.
“I told them look, if you have to spend RM100 on laundry per trip, you might as well wash your clothes at home and save the money for Salcra.
“But they said they were entitled. I said no you were not entitled. I told them the RM100 was the amount my wife and I would use to buy detergents for the entire year. So, I told them it wasn’t right,” he said.
Over the years, Vasco instilled the meaning of accountability and responsibility in his staff. And since 2008, Salcra has been able to pay bonuses, at times up to two to three months.
To summarise, Vasco categorised six main challenges that he faced while helming Salcra. Firstly with the management and staff of Salcra.
“In order to improve the work discipline, many staff continued to resist in having commercial work ethics. But we have to insist on a timeline on task/job completion, dismantling “cliquish” approach but building and creating one team (togetherness and as family), developing a resilient team, training staff to work longer hours, logical thinking and having the ‘right’ industry knowledge,” he stressed.
Secondly, Vasco had to focus on Salcra’s financial statements, as many financial records were not correct, not updated, missing and computed with many errors and lot of incomplete records and phantom transactions.
Thirdly, landowner participants. Many of them thought that Salcra gave easy money, social approaches and plenty of grants.
“Productivity was not the focus and some of them were very hostile, politically motivated and had a ‘blaming mentality’ attitude. There was a communalised or ‘watershed management’.
Fourthly, he was faced with the political reality of that time, where ‘community politics’ were very prevalent and can be very “tricky”.
“And sometimes, they wanted to get involved in management but at the end of the day, it was always ‘self-interest’,” he said.
Fifthly, among the stakeholders, Vasco also experienced that vendors and contractors did take advantage of the weaknesses, and many false claims were detected.
“Public at large, in particular the native customary right (NCR) landowners had very little confidence in the agency’s programmes. Many were met with negativity and due to that I received lot of flying letters in those days,” he recalled.
Finally, the land terrain. Landowners, normally surrendered land that are very hilly, far from the community, less fertile soil and scattered.
Transformation and new system
As the person having full control over the whole organisation, Vasco normally spent about 60 percent of his time in the field and area of operations, which normally included inspection, discussion and decision-making.
He also prides himself that for at least six years (from 1997 to 2002), he did not have specific office hours and rest days.
“My minimum hours of work are 10 hours a day and six days a week. Initially, I did it on my own as I had so much work to do. But later on, many staff also followed the way I did my work,” he revealed.
And whenever the need arose, he would go to the ground on unmarked vehicles and unannounced arrivals.
“My vehicle was not fixed with Salcra logo. I came unannounced and at odd hours of the day and night. This was part of the things that I had to do to carry out spot-checks to prevent abuse of the system,” he said.
Vasco also put a lot of emphasis on financial discipline among the agency’s staff and other stakeholders.
“With every payment, documents and attachments must be reviewed and seen by the general manager until confidence was established.
“At the same time, we also introduced comprehensive and commercial budgets with greater details; redefined the organisational chart; reassigned duties and responsibilities; redeveloped new authorities, delegation of power, responsibilities approved by the board; developed comprehensive cash and banking operations systems, closing about 30 current accounts and maintaining only relevant eight current accounts for the group; redeveloped procurement system, vendor listings, contracting strategies and comprehensive technical and financial tender analysis; redeveloped more comprehensive limits of financial authority in line with the government practice.
Besides that, he also created new departments and units such as the landowners’ development department to track every landowner and implement a comprehensive landowners’ data; marketing and sales department to market and sell Salcra’s own fresh fruit bunches (FFBs), crude palm oil (CPO), ruminants, etc.; setting up its own security unit such as the auxiliary police and developing new strategic plans from 2002-2010 and updated continuously thereafter.
Vasco also introduced a system to appoint certain landowners as ‘mandor’ or supervisors in areas where they owned land, developed by the agency.
“All ‘mandor’ were landowners. If productivity was low, then the ‘mandor’ were not doing their work. With this system, they were co-employers like us. This allowed them to work harder because they knew that if they had better yields, they would have better dividends,” he explained.
He also gave the landowners various incentives such as send them to courses and training to improve their productivity levels and management skills.
“We even brought some successful ones on overseas trips. We wanted them to learn, and upon their return, they could share their knowledge and experiences. In this way, we too could help other participants and landowners to succeed.”
As for land titles, Vasco noted that over the years, Salcra had issued 24,000 such documents to its participants and landowners statewide.
“This is a massive boost for Salcra. With the titles, landowners were happy they finally got what they hoped for. This was another great success story for us. Of course, for those who didn’t get theirs, especially the new participants, we would give them after 10 years as stipulated under our 10-year Clause. It’s part of our land policy.”
He pointed out that his role as general manager meant he had to deal with the vendors and other stakeholders such as the contractors.
“I had to do a lot of balancing act. With the staff, I had to be like a father-figure who truly cared about them, even though they might think I was fierce and stubborn.
“As for the politicians, I had to be able to interact with them meaningfully. And the landowners — yes, I had to engage with them from their perspectives, so too with our vendors and contractors.”
Success stories
Vasco commented that there are a lot of success stories that Salcra and its group had achieved.
He highlighted the following:
- Financial Management
During his tenure as general manager of Salcra, Vasco implemented comprehensive financial limits of authority guidelines.
“We also implemented various management accounting techniques for tracking of business activities, cost prudence, production costs, contribution margin towards profitability; prompt preparation of financial statements for the relevant authorities’ decisions and approval,” he said.
Vasco also highlighted that for the last 24 years, the agency generated more than RM14 billion revenue and achieved a 4-star rating in financial management for the last eight years from the Auditor-General, Malaysia.
- Oil palm estate operations
For the last 20 years, Salcra sourced high yielding oil palm seedlings and kept tabs on comprehensive estate data and record keeping.
“Oil palm estates are managed on industry and commercial practices, having sound agronomic practices, fully compliant with environment and sustainability estate practices”.
- Palm oil mills
These mills are managed on a sound commercial enterprise and fully managed by Salcra’s own staff with one Dayak female mill manager.
As at December 31, 2019 the palm oil mills processed a total of more than 18 million metric tonnes of FFBs, generated more than RM9 billion revenues and more than RM600 million profits for the last 24 years.
- Development and acquiring headquarters
Salcra acquired a new headquarters in 2008 – Wisma SALCRA, after renting office space for more than 30 years.
“Despite the adverse comments from our critics, the office space was getting too small as business and operations expanded,” he recalled.
- Land participants, net proceeds and land titles
Currently, Salcra has more than 23,000 landowners participating in land development programmes, mainly on oil palm.
The total revenue generated for the last 25 years is about RM5 billion and net proceeds distributed to the landowners amounted to about RM1 billion. So, it is a fact that Salcra has created several millionaires from its 25 years’ programme.
“As at 2019, more than 20,000 Section 18 land titles had been issued to rightful landowners. This is in progress, as more land are being developed,” Vasco said.
There are many landowners or their children who are directly employed by Salcra. At the same time, it also keeps comprehensive landowners’ data and information.
- Malaysian Sustainability Palm Oil (MSPO) Certification
All Salcra oil palm estates and palm oil mills are MSPO certified in 2018 and most probably the only government agency that has its both estates and palm oil mills all MSPO certified.
- Human resource development
With the completion of Bajo Training Centre, Salcra now can comprehensively focus on training, development and imparting knowledge to its staff, workers and landowners.
- Information Technology (IT).
Comprehensive usage of IT in all its operations; finance, human resource, marketing, estate operations, palm oil mills and engineering, and utilisation of drone technology in mapping the estate.
- Development of ruminant and aquaculture
Currently, Salcra has more than 2,000 head of cattle in the estates and this will be increased in future. Salcra has also developed fish cages farming where it has more than 500 cages, rearing ‘tilapia’ and ‘patin’ fish.
- Salcra’s net worth
According to Vasco, Salcra and its group of companies can easily have a net worth of about RM2.5 billion as at 2019.
- Representing Salcra and State Government
During his time with Salcra, Vasco sat on various organisations and agencies relating to the palm oil Industries such as the Malaysian Palm Oil Board (MPOB), Malaysian Palm Oil Council (MPOC), Malaysian Palm Oil Certification Council (MPOCC), Malaysian Palm Oil Association (MPOA) and Sarawak Oil Palm Plantation Owners Association (SOPPOA).
RECOMMENDATIONS
Revenue target
Before leaving the organisation he led for 24 years, Vasco threw the new management a challenge – achieve annual revenue of RM2.5 billion by 2030.
He believes the target is achievable since Salcra has almost 100,000 hectares to be developed for oil palm and other crops – plus the fact that it can double its fertiliser inputs over the next 10 years.
“Since we have a lot of land, my challenge to you all is that in 10 years, you should be able to hit RM2.5 billion in gross revenue for the whole group. If you don’t do that, you don’t do yourselves justice. That should be your challenge. So, my tall order for the new management is RM2.5 billion revenue in 10 years,” he said at his recent farewell luncheon at Salcra headquarters in Kota Samarahan.
He reiterated that the Salcra staff, especially the younger ones, must think outside the box to enable the organisation to yield better results.
“You’ve between 80,000 and 100,000 hectares to be developed over the next 10 years. On top of that, there should be two more palm oil mills to be built from the current five. And your fertiliser outputs can also be doubled. So, you should be able to see this in the next management coming from you young fellows,” he told the gathering.
Vasco advised the Salcra staff to adopt modern technology.
“Keep on learning and acquiring as much knowledge as possible. The bottom line is never stop learning. Life itself is a learning process.”
He urged the staff to adopt a positive working attitude to gain a better standing in the organisation and make it one of the best in the oil palm industry.
“Please be committed in your work – don’t just look at it as a 9-to-5.30 kind of job. So, I would advise you all to make Salcra one of the best in the industry, not just in Sarawak but throughout the country.”
In his parting advice to the staff, Vasco reminded them to venture out to the fields.
“There aren’t enough jobs in the headquarters but plenty out there. So, I would like to challenge your officers to go out there and develop new areas.”
He also clarified that Salcra was not just about palm oil but actually “anything to do with agriculture.”
“A lot of people misperceive that Salcra is only about making ladang sawit (palm oil plantation) on NCR land. That’s not correct. Read the Ordinance — it’s anything on agriculture undertaken on its own or in a joint venture.
“That’s why we moved away from that norm. I hope the younger staff can change the misperception otherwise we’ll lose out.”
Downstreaming
Vasco said that in order to expand, Salcra must diversify its business portfolios downstream.
“There are lots of things Salcra can do – fish-rearing, livestock-rearing and fertiliser-manufacturing. Fish- and cattle-rearing alone can easily bring in RM200 million annually if you know how to do it.”
According to Vasco, Salcra also owns a commercial outfit for digital economy purposes.
“It’s IT savvy for rural development – different from the government collecting, processing and packaging centre (CPPC). This is our own where you can do e-marketing and e-business.
“I asked an IT guy how much it would cost to build a communications tower and was told probably about RM500,000. So Salcra could build one for this purpose, (e-marketing and e-business),” he suggested.
The retired general manager observed that with its proximity to the new airport, the organisation could do a lot of online transactions for both local and foreign markets.
“It will be like the Lazada or Alibaba type of business model. This has been prepared but it depends on whether the government of the day sees the potential.”
Vasco said Salcra now could venture into anything related to agriculture and compete in the international market, adding, “But to do that, Salcra must go into IT. That’s the only way forward.”
In retirement, Vasco plans to do the things he loves — reading, photography, travelling and appreciating arts and nature.
“But the love of figures will always be with me until I have enough of it. And should my services be needed by the authorities in the future, I don’t mind sharing my experiences, especially in plantation management. For now, I prefer doing what I love, including spending more time with my cucu (grandchildren),” he beamed.
APPRECIATION
In his parting words, Vasco, would also like to record his greatest appreciation and thanks for the support, guidance, advice and share of knowledge during his time with Salcra, especially the Federal government, ministries and federal agencies; State government, ministries, departments and agencies; chairmen and board members of Salcra and subsidiary companies; shareholders; management and staff of the Group; Ahli Jawatankuasa Pembangunan Ladang Salcra (AJPLS) and landowner participants, bankers and professional bodies; his family members and former colleagues.
