Chairman of Nam Long: changes start from the leader’s mindset

With an open mind and willing to change the old way of working to cooperate with foreigners, Mr. Nguyen Xuan Quang, Chairman of Nam Long Corporation, believes that while growing from a startup to a corporate, businesses might get stuck “inside of the box” as the team developing inherent habits. Therefore, it is necessary to bring the breath of fresh air from the outside to create motivation for the team. 

From a business with tens of billion dong capital, Nam Long has raised a charter capital of 1600 billion dong. What is the secret to successfully raising of such large capital investment?

In order to attract the cash flow, we had to improve transparency in operations, enhance the staff quality, and complete the corporate governance policies… but first of all, we opened door and welcomed foreign investors to contribute capital and support the management of the company.

Mr. Nguyen Xuan Quang, Chairman of Nam Long. 

It was difficult to attract foreign investment if we remain as a family business or a limited entity, so we decided to change Nam Long’s legal form to a joint stock company.
The changing process was not easy as it requires changing the mindset of Management Board, as well as building an operational team to follow up closely with the development plan and strategy.  

After become a JSC, we had to commit to the IPO plan and to date, we had fulfill this commitment. This is the foundation for the partnership with major companies.  
Previously, in Vietnam, not only in real estate industry but across other industries, it was less likely or even rare to see a public company that has high standard of corporate governance.  

Therefore, Nam Long Board of Management clearly defined and determined to apply good corporate governance practices in the world to attract investment.
Nam Long put effort to accomplish all the objectives above and successfully invited many international partners such as IFC, Goldman Sachs, Keppel Land, Japanese investors, to companion and cooperate.

How long did it take you and what was the biggest challenge to accomplish the above objectives?

In fact, me and other Board members spent 2 years to agree on changing the company legal form to a JSC. At that time, we asked ourselves why we needed the change if Nam Long had been successful and we were able to make all the decisions. 

But Board of Management were convinced by the thought of sustainable development for the next 10-20 years, to change and give up part of the ownership to welcome other shareholders. 

For me, when we switched our perception and determined to change, the changes became less challenging. However, there were still unexpected factors, for example the downfall of the market in 2008-2009. 

At that time, foreign shareholders all had bad luck investing in Nam Long but they did not give up. Not until 5 or 6 years later when the real estate market started to get better, Nam Long’s business became more favorable. 

Nam Long’s Boards of Management has 5 foreigners, not including the CEO. What makes you believe in giving the captain job to foreigners?

Before having foreigner employees on board, I have well prepared as if clashes between the Old and the New would happen when introducing a new perception to the company. 

NLG partnered with Japanese investors to develop large projects i.e. Waterpoint township, Mizuki Park, Akari City…

But I realize that while growing from a startup to a corporate, businesses might get stuck “inside of the box” as the team developing inherent habits. Therefore, it is necessary to bring the breath of fresh air from the outside to create motivation for the team. 

Of course, it took time for the old ones to reconcile with new managers who have new and different styles of working. It took us five years to solve this problem, and at the present time, I can say that the foreigners coming to work at Nam Long have a much better environment.

However, the challenge of running a business is not just corporate governance, but also developing a corporate culture. In particular, the problem that Nam Long is facing and need to constantly improve is the formation of "cooperative culture."

After doing and testing, I decided to unite the organization with three fundamental values: Professionalism, Integrity, and Ownership. Integrity - "Do what you say" will be the main focus of Nam Long's corporate culture throughout 2018. This culture will help the company's working environment become more professional and responsible, which is the foundation for sustainable development.

In addition, we also launched a project called "Building the Ability and Career Matrix" to build a high achievement oriented culture, to recruit and select the right people, to create transparency for performance evaluation system, at the same time, to motivate employees in developing the required skills to bring success to themselves and the organization.

Could you share more about building a "cooperative culture" in your business? What is the most important factor to create unity between the parties in a cooperative relationship?

I can share the story about the cooperation between Nam Long and Japanese partners. The company had prepared from 2008 to 2015 to work with Japanese partners. This is the country of perfection from culture to human personality, everything has high standard the requirements Vietnamese partners are also higher.

In fact, Nam Long had worked with international organizations such as Goldman Sachs, IFC and Keppel Land ..., so to some extent, we also reached certain standards. This makes it easier to work with Japanese investors.

What is special about Japanese investors is that they invested in business and took a professional supporting role. For example, in the early stages of development, Nam Long was responsible for project development, and our partners provided professional supports in project management models, real estate development standards, and also those that Nam Long was not good at such as commercial real estate.
In this process, we always actively learned professionalism, worked on an initiative and friendly ground, and fulfilled all the commitments that we both agreed on. 

Having to continuously worked with big projects, Nam Long’s employees must have face lots of pressure. As a leader, did you have any solutions to strengthen the labor force? 

At a company that is growing at an average rate of over 30% per year, it’s not easy for the team to satisfy all the requirements. Especially when in Vietnam, there are not a lot of options for senior management positions.

Therefore I have to find a working recipe, for example the Design and Build model, or outsourcing the project management job to to external units... Besides, I started to improve the capacity of the team through on-the-job trainings with experts. 

Additionally, in order to create a favorable and fair working environment, as well as create motivation for our employees, we have developed a 3P payroll system based on Position-Personal-Performance, and an employee rating scheme applying "Balanced Scorecard" management approach.

This system will help the Company achieve three main goals: Complete common goals as personal goals are completed; create a fair scheme for review, allowance, bonus and welfare; develop employee and select potential, excellent staff for future teams.
In a more sustainable thought, I’m aiming to the younger generation. The multi-national workforce that we are building is multicultural and has great capacity. They just need more time for training and working in real projects to gain experience and develop their skills. 

By: Tinnhanhchungkhoan.vn