In the middle of my crash course on the defense industry and the Chan Group's defense product portfolio for Hina, I got a message notification on my watch.
"Excuse me, Miss, let me have a look"
: The furniture has arrived :
"It looks like your beanbags have arrived Miss"
"Yippee! Let's go back to my room"
"How about the briefing? We are not even halfway through"
"We can continue in my room. I think you've had enough caffeine today with that big mug full of espresso"
"Do not mind me, but all you've ordered are two beanbags. Should I get a projector in your room so we can discuss using some visuals?"
"Good idea, Sin. Let's go"
So we got up and on our way back to Hina's new 'office' I quick-dialed Lui to get a projector set up in the room. As soon as we went in I saw two massive beanbags, one in emperor blue and another one in baby pink. Hina made a short dash to plunge herself into the blue beanbag in delight. What a child she still was.
I walked over to the projector that Lui set up earlier on a tripod and plugged in my company PPT containing USB into it. After a short wait with a whirling sound, the projector was on and I noticed Lui had already sensibly directed it to a good wall and adjusted the focus in advance.
"Right, Miss. I will stand here and go through each slide with you now"
"Right. Don't you wanna try your beanbag though?"
"What do you mean my beanbag?"
"The pink one is yours"
"I don't need a beanbag, Miss. I don't work lying on a beanbag"
"Aw come on, I ordered two so we can both sit unless you are insinuating you want to share the bag with me instead"
"No, it's not that-"
"Let's get to it then. Hop yourself onto the beanbag"
"Er… don't you want the pink one though?"
"Drop your gender stereotypes"
"Miss, I also happen to be a female"
"Pfft. Just get on to it"
:sigh:
I reluctantly plunged myself into the pink beanbag. It was indeed comfortable, but a bit hard to move around or even turn to face Hina to talk. I held the projector remote controller in my hand, but the angle we were perched in the beanbags made it difficult to see the projection on the wall.
"Sin, I can't see anything"
"Maybe that's why we need to get a proper desk and chair. We can move to a meeting room for now"
"Nah, please go fix the projector"
"It's not broken"
"Duh, I mean adjust it. Make it point to the ceiling"
I duly obliged and soon we were both lying on our backs in our respective beanbags staring at the ceiling.
"Now let's continue from where we were before. Our company makes all kinds of defense products for the Army, Navy, and the Airforce. We have all bases covered. But of course, there are some products we sell more or have more specialized characters that distinguish us from the others"
"I'm not too familiar with other weapon manufacturers in our country"
"Miss, defense products, please. Also, you should be familiar with some of the names for sure"
"Such as?"
"Wanda"
"Huh, they run hotel chains and department stores?"
"Their revenues from those businesses are minuscule compared to what they generate from their defense business wing"
"Er.. Don't they also do insurance?"
"Yes, as well as owning an ice cream brand"
"Gees I never knew"
"Most civilians would not look into it as they are too familiar with the Wanda name from other products such as the ones you mentioned. And unfortunately, it is this diversification into other markets that pulled them ahead of us in recent years"
"You mean they are richer than us Chans?"
"Let's say the Chans are 'old rich', blue blood, so to say. The Wan family that owns majority shares in Wanda are more 'new money', nouveau riche"
"Your French pronunciation is terrible"
"I'm sorry I did not have a handful of private tutors teaching me different languages since I was five years old, unlike some very privileged person I know"
"Heh, you flatter me. When you have talent like I do all you need is some early education and the best quality tutors" - is she joking or is she just that dumb?
Whatever...
"So… Let me continue. Since we are talking about Wanda, let me use this as an example of how our domestic defense industry is divided. For the Army, we lead the ballistics technology over Wanda although they almost monopolize the mass production of the energetic materials"
"Whoa, hold on there. What are you talking about"
:Sigh:
"I will show you with the slide. Look, this is artillery. It shoots munitions. The munition flies over and lands on the target. Surely you've seen this in a movie right?"
"I guess, that's where the expression 'shell shocked' comes from right?"
"Correct. Now, 'ballistics' is the science of how that munition will be fired and flies in trajectory"
"And the energetic materials?"
"They are chemicals that contain a high amount of energy that can be released when tickled in the right way"
"Gotcha. So explosives basically"
"Yes. So we are the technology leader in terms of designing munitions that will have optimal performances, and also making the artillery munitions as final products, while Wanda mass produces the necessary chemicals that go into them, and I would like to add, they are not particularly of good quality"
"Why are we using them then?"
"For practical and political reasons. Practically, we would need to have very expensive and massive facilities and workforce to produce the amount needed for our defense forces each year. Investing in them is not only expensive but will take a very long time for the return of investment while having to compete with Wanda to win the production contracts from the government. Politically, this division of work scope creates an acceptable status quo where both the Chan Group and Wanda can be satisfied with their share of the government's annual defense budget"
"So we are putting sub-par materials into our munitions?"
"Wanda would not agree to that, neither would the majority faction of NDDC, the National Defence Development Centre. So this is a headache for us and when and if there are any problems with the finished goods, there will always be great friction and arguments regarding whose fault it is that things went wrong"
"What kind of things can happen?"
"Soldiers die during firing training, stuff explodes in a factory, the munition becomes a dud and cannot achieve its objective. This is one of the reasons why you, as the CEO of the Chan Group, should take this industry very, very seriously. When our products go wrong, it's not a matter of getting complaints and doing refunds. People die"
"That sucks"
"It surely does. Hence the necessity for you to be really on top of this game, and also this is the reason why some of your siblings and old faithful in our company were against your leadership. You have not yet proven that you can thrive in this business"
"Isn't this up to the technology though? It's not like a CEO will be mixing the chemicals himself or designing the munitions"
"Yes and no. Yes, it is a technical matter, but as the CEO you have the ultimate responsibility for anything that ever goes wrong in our organization. Also, as the CEO of the Chan Group, you are in a position to get the government to accept crap products"
"What?"
"Irresponsible companies and business practices have done this before and will continue to do so. You have the power to lead the government to open up their eyes and buy something better, or convince them to buy something cheap en masse"
"Not quite sure what you mean by that. Wouldn't we always want to sell good stuff, especially when it comes to life and death as you mentioned before"
"Yes, we do. However, the procurement process of defense products is very long and complicated. The best product and the best price do not always win"
"That sucks"
"Yes, it does" - I let Hina sulk a bit before continuing. There's still so much for us to go through and not much time left now.
"So to continue, this is why you need the size in this industry. If you are a smaller company, no matter how advanced your technology and product are, the best you can hope for is to supply to megacorps like us or Wanda, who will be guaranteed at least some scope of any major military projects"
Hina looked deep in thought trying to process what I was explaining.
Time to drill the point home now then.
"The government doesn't want megacorps like us to invest tons of money in production lines or new technology, only to lose in a bidding war and render that investment useless. This would have a far too negative impact on the losing company and will affect far too many workers and their families, which in turn will be a big hit on the overall economy too"
"Please. Just tell me what this all means. Straight talk"
"Right, if for example, Wanda completely loses their explosives business to us, their whole group will suffer, and to take it to the extreme, their ice cream business could be abandoned"
"That would be a disaster"
"Yes, it is. That's why the government likes splitting contracts and giving both the Chan Group and Wanda something to work with. It keeps everyone happy, or at least not out on the streets"
"Isn't that all fine and dandy then?"
"But sometimes it is not always split like that", I continued after a bit of a pause.
"Every now and then there can be a major project that could decide the fate of a company, where losing the tender would lead to significant loss of ground while the winning company can kick on to take a massive lead on the field"
"Such as?"
"KAK, another major player in the industry benefited from this about a decade ago. They won the contract to develop an Unmanned Aerial Vehicle, UAV, for reconnaissance and small payload delivery, and the whole project went almost exclusively to them. They are now so far ahead in this game that neither we nor Wanda see any need to invest further in this technology to challenge them"
"You mean to say, we - the Chan Group - are falling behind?"
Hina raised one of her eyebrows like a CEO. Well, at least like how her father used to do.
"Miss, we have another such make-or-break project coming up now, which could decide the destiny of our company for the next two decades. But that, I will brief you about some other time"
"Hey you can't just stop at that like some cliff hangar ending"
"We are just out of time and I rather you learn about it comprehensively in one go some other time. You have a lunch meeting to go to now"
"With whom?"
"Luckily you are not seeing any external guests today - you are simply not ready. But your brother Jindo wanted to see you"