SIA chief Cheong struts his stuff - Life sometimes imitates art.

25 Jun 2001

By Eric Ellis

WHEN Singapore Airlines chief executive Cheong Choong Kong was studying maths and science at Adelaide University and the Australian National University in the early 1960s, he fancied himself as something of a thespian.

The man set to become the most influential player in Australasian aviation had a particular taste for the fin de siecle farce of French playwright George Feydeau, whose work, critics contend, portrays the folly of those who fashion needless complexities out of their own foolishness.

Today, as Cheong the businessman progresses through the farce involving Air New Zealand and its struggling Australian understudy, Ansett, the artist in him might pause to muse that clearly life sometimes imitates art.

For it is mostly the foolishness of officials on both sides of the Tasman that has allowed two of the great works of regional aviation to fall into the cashed-up hands of the Singapore government-controlled Singapore Airlines.

But Cheong, who keeps his thespian hand in during occasional appearances on Singapore's government-controlled TV, might need the scripts of more recent roles to nurse the airlines back to centre stage, if the New Zealand and Australian governments allow SIA to close the deal cut last week with Air New Zealand.

Last month, Cheong entertained Singaporean audiences by playing a member of parliament in a Singapore television drama aptly entitled Making the Headlines.

Two years ago, he appeared in a widely-panned local film called Tigers Whip, in which he had two roles, one as a guru, the other as a sinseh, or spiritual healer.

Cheong is dogged by a straggly comb-over which only adds to his avuncular demeanour, and one might have expected him to have had his fill of TV drama after a difficult year at the airline.

In November last year, it was hard to avoid seeing Cheong on the box in the often farcical, always tragic aftermath of the horrific Singapore Airlines flight SQ006 crash in Taipei which killed 82 passengers.

It was the first crash in SIA livery - though associate SilkAir in 1997 had lost a plane in Indonesia in what many suspect was a case of pilot suicide - and SIA failed to live up to its image as one of the world's great airlines.

SQ006 was taking off from a runway it wasn't supposed to be on, during a typhoon that was buffeting Taipei.

The Boeing 747B collided with a repair unit's crane, spreading wreckage across Chiang Kai-Shek International Airport.

Pilot error was admitted by SIA but not before a series of staggering public relations blunders.

In the US, an SIA spokesman told relatives and reporters there were no casualties when CNN was showing them being dragged out of the wreckage.

To make matters worse, SIA then released a list of the dead to the Singaporean media before it had informed grieving relatives.

Two moments in particular stood out for Cheong. And for control-obsessed Singapore, where Cheong has prospered, these moments were rare, revealing times when control lapsed and emotions took over.

Cheong, informed of the crash in the middle of the night in Christchurch, where he was attending an Air New Zealand shareholders meeting, flew to Singapore and then Taipei to personally take charge of crisis management.

Two dozen relatives of crash victims also went to Taipei. Two days after the crash, SIA held receptions and news conferences in Singapore and Taipei. Angered by the airline's tardy release of information, relatives in both capitals were in no mood for spin.

In Singapore, an inconsolable Tan Yin Leong forced his way into a nationally televised news conference and demanded to know why he had first learned of his brother's death in the press and why SIA security had tried to take from him a casualty list he had obtained from the media that confirmed his brother was a victim.

"We want to know what really happened," pleaded Tan.

"All our news is from the newspaper reporter and you are the ones who tell me ... not to believe the press. Now, my brother is dead. Is dead!"

In Taipei, Cheong was getting similar treatment.

"Nobody knows anything. We were just at the [Singapore] airport, crying, crying, crying," one woman yelled at him.

Cheong, who has subsequently been highly praised for his compassionate handling of the tragedy, was visibly shaken by the incident.

It does not do for Singapore and its most famous corporate symbol, exemplified by the Australian-conceived Singapore Girl, to be globally embarrassed.

The next day, airline security was beefed up to ensure only accredited journalists were admitted to press briefings.

Mention of the crash was quickly excised from SIA's website, and the airline's flight code was changed.

Local media were also warned not to speak to victims' relatives, not unlike the way they are warned by the Singapore Government - which controls 56 per cent of SIA - to lay off critical examination of the Government and its institutions.

Despite the size of such shareholdings, and the liberal presence of government and military officials on corporate boards, including SIA's, Singapore officials frequently claim that the Government does not exercise control over SIA and other companies it owns.

These include Singapore Telecommunications (now bidding for Australia's C&W Optus) and DBS Bank, Singapore's largest. DBS was last year negotiating a merger with Australia's Westpac, but the talks foundered on the issue of control.
Senior Minister Lee Kuan Yew, at a dinner in his electorate of Tanjong Pagar on Singapore's national day in 1997, noted that global airlines were cutting costs, raising productivity and forming alliances.

The baton was quickly picked up by the pro-government Straits Times. Under the headline "SM tells how to keep SIA, finance sector abuzz", Lee laid down the law, saying SIA would have to choose its partners and strive to become "globally competitive or it will decline". Workers and unions "must and will work together with management and the Government" to take steps to make SIA more competitive, he said.

"This will be done with the co-operation of the unions and workers. The costs saved will be shared fairly among managers, workers and shareholders.
"If we do not improve and innovate, we will lose out," he said.

Lee Kuan Yew's word carries great weight in Singapore. So, is this an example of interference from the top, or is it merely encouragement?

It should be seen as an exhortation, insists Singapore Airlines chief of public affairs Rick Clements. The Government is a demanding shareholder and, like any other, expects returns and performance, he says.

And, generally, it has not been disappointed. SIA has consistently been one of the world's most profitable airlines in a capital-intensive industry in which it is notoriously hard to make a buck.

Operating profit last year, arguably SIA's most difficult after the SQ006 tragedy, came in at $1.46 billion, on revenues of $10.51 billion. Despite the loss of SQ006, the numbers were such that the SIA board felt they deserved a pay rise. Directors' fees were raised 150 per cent.

Innovation and service are SIA's hallmarks. It was the first airline to introduce in-flight email (on the route flown by SQ006). And then there is the Singapore Girl, who, though she may offend some feminists, keeps male business executives and potential investors happy at the expensive end of SIA's planes. (SIA's cabin crew training facility is known as the "Asian Babe Factory" in Singapore.)

Much of SIA's good times have been on Cheong's watch - he has been managing director for 15 years. He won Fortune Magazine's 1999 Asian Businessman of the Year award and is widely acknowledged in the industry as a good operator.

Melbourne businessman Charles Goode describes him as "very, very capable". Goode is the only non-Singaporean on the SIA board.

Cheong is helped by a system very much geared toward SIA's success. SIA enjoys an absolute monopoly in Singapore, and it's easy to look good when your regional competitors are Indonesia's Garuda and Malaysia's MAS.

Singapore does not have trade practices or anti-monopoly legislation as understood in Australia and it's a happy circumstance that Tjong Yik Min, the chairman of Singapore's aviation industry regulator, also sits on the SIA board.
SIA corporate affairs officer Innes Willox, who joined SIA late last year after three years as Australian Foreign Minister Alexander Downer's press spokesman, denies Mr Tjong has a conflict of interest.

However, The Australian understands that Mr Tjong will soon step down from at least one of the posts, probably that of the regulator, to address concerns about negative perceptions.

As Lee Kuan Yew has said, Singapore is on display the moment a passenger, preferably a high-paying foreign businessman, steps aboard an SIA flight.

He is then transported to one of the world's most efficient airports, Changi, and then by airconditioned limousine along broad, gridlock-free boulevards to a five-star hotel.

At the end of this seductive path, critical investment decisions are made in a country that functions as a corporation as much as a sovereign entity.

Singapore puts on a fabulously alluring show for the visitor and potential investor, a point perhaps not lost on Cheong the amateur actor as he makes his way through the corridors of power in Australia and New Zealand.

Said Australasian aviation's new best friend in a recent interview: "The cynic would say corporate life is like theatre, because one also acts.