The Shanghai Taxi Driver’s MBA Lecture

The following is a popular blog post by Run Liu (刘润) on March 15, 2006:

[in translation] The Taxi Driver Taught Me An MBA Lesson

I needed to go from Xujiahui to the airport, so I hurriedly concluded a meeting and I was looking for a taxi in front of the Meiluo building. A taxi driver saw me and very professionally came in a straight line and stopped right in front of me. Thus followed the story that astonished me greatly as if I had attended a lively MBA course. In order to faithfully preserve the intent of the taxi driver, I have tried to reproduce his original words according to my memory.

“Where do you want to go? Good, the airport. At Xujiahui, I loved to get business in front of the Meiluo building. Over here, I only work two places: Meiluo building (美罗) and Junyao building (均瑶). Did you know? Before I picked you up, I circled around Meiluo building twice before I saw you! People who come out of office building are definitely not going to some place nearby …”

“Oh? You have a method!” I agreed.

“A taxi driver must also have scientific methods,” he said. I was surprised and I got curious: “What scientific methods?”

“I have to know statistics. I have made detailed calculations. Let me tell you. I operate the car 17 hours a day, and my hourly cost is 34.5 RMB …”

“How did you arrive at that?” I asked

“You calculate. I have to pay 380 RMB to the company each day for the car. The gas is about 210 RMB. I work 17 hours per day. On an hourly basis, the fixed cost is the 22 RMB that I give to the taxi company and an average of 12.5 RMB per hour in gasoline expenses. Isn’t that 34.5 RMB?” I was a bit surprised. I have taken taxis for ten years, but this is the first time that a taxi driver has calculated the costs this way. Previously, the taxi drivers all tell me that the cost per kilometer was 0.3 RMB in addition to the total company fee.

“Costs should not be calculated on a per-kilometer basis. It should be calculated on an hourly basis. You see, each meter has a ‘review’ function through which you can see the details of the day. I have done a data analysis. The averarge time gap between customers is seven minutes. If I started counting the costs when someone gets in, it is 10 RMB for about 10 minutes. That means each 10 RMB customer takes 17 minutes of time, which costs 9.8 RMB (=34.5 x 17 / 60). This is not making money! If we say that customers who want to go to Pudong, Hangzhou or Qingpu are like meals, then a 10 RMB customer is not even a bite of food. You can only say that this is just a sprinkle of MSG.”

Great! This driver did not sound like a taxi driver. He seemed more like an accountant. “So what you do then?” I was even more interested and I continued my questioning. It looked like I was going to learn something new on the way to the airport.

“You must not let the customer lead you all over the place. You decide what you want to do based upon the location, time and customer.” I was very surprised, but this sounded significant. “Someone said that the taxi driving is a profession that depends on luck. I don’t think so. You have to stand in the position of the customer and consider things from the customer’s perspective.” This sounded very professional, and very much like many business management teachers who say “put yourself in others’ shoes.”

“Let me give you an example. You are at the entrance to a hospital. There is someone holding some medicine and there is someone else holding a wash basin. Which person will you pick up?” I thought about it and I said that I didn’t know.

“You take the one with the wash basin. If you have a minor complaint that you want to be examined and to get some medicine, you don’t usually go to a faraway hospital. Anyone who is carrying a wash basin has just been discharged from the hospital. When people enter the hospital, some of them die. Today, someone on the second floor dies. Tomorrow, someone on the third floor dies. Those who make it out of the hospital usually have a feeling of having been given a second life and they recognize the meaning of life again — health is the most important thing. So on that day, that person told me, “Go … go to Qingpu.” He did not even blink. Would you say that he wanted to take a taxi to People’s Plaza to transfer to the Qingpu line subway? Absolutely not!”

I began to admire him.

“Let me give you another example. That day at People’s Plaza, three people were waving at me. One was a young woman who had just finished shopping and was holding some small bags. Another was a young couple who were out for a stroll. The third one was a man who wore a silk shirt and a down jacket and holding a notebook computer bag. I spent three seconds looking at each person and I stopped in front of the man without hesitation. When the man got in, he said: ‘Yannan Elevated Highway. South North Elevated Highway …’ Before even finishing, he could not help but ask, ‘Why did you stop in front of me without hesitating? There were two people in front. They wanted to get on as well. I was too embarrassed to fight with them.’ I replied, ‘It is around noon and just a dozen or so minutes before one o’clock. That young woman must have slipped out at noon to buy something and I guess that her company must be nearby. That couple are tourists because they are not holding anything and they are not going to travel far. You are going out on business. You are holding a notebook computer bag, so I can tell that this is business. If you are going out at this time, I guess that it would not be too close.’ The man said, ‘You are right. I’m going to Baoshan.'”

“Are those people wearing pajamas in front of supermarkets or subway stations going to travel far? Are they going to the airport? The airport is not going to let them enter.”

That makes sense! I was liking this more and more.

“Many drivers complain that business is tough and the price of gas has gone up. They are trying to pin the cause down on other people. If you keep pinning the cause on other people, you will never get any better. You must look at yourself to see where the problem is.” This sounds very familiar. It seems like “If you cannot change the world, then you should change yourself” or perhaps a pirated copy of Steven Corey’s “Circles of Influence and Concern.” “One time, on Nandan Road, someone flagged me down and wanted to go to Tianlin. Later on, someone else flagged me down on Nandan Road and he also wanted to go to Tianlin. So I asked, ‘How come all you people who come out on Nandan Road want to go to Tianlin?’ He said, ‘There is a public bus depot at Nandan Road. We all take the public bus from Pudong to there, and then we take the taxi to Tianlin. So I understood. For example, you look at the road that we just passed. There are no offices, no hotels, nothing. Just a public bus station. Those people who flag down taxis there are mostly people who just got off the public bus, and they look for the shortest road for a taxi. People who flag down taxis here will usually ride not more than 15 RMB.”

“Therefore, I say that the attitude determines everything!” I have heard dozens of company CEO’s say that, but this was the first time that I heard a taxi driver say that.

“We need to use scientific methods and statistics to conduct business. Those people who wait at the subway exits every day for business will never make money. How are you going to provide for your wife and kids at 500 RMB a month? This is murder? This is slowly murdering your whole family. You must arm yourself with knowledge. You have to learn knowledge to become a smart person. A smart person learns knowledge in order to become a very smart person. A very smart person learns knowledge in order to become a genius.”

“One time, a person wanted a taxi in order to get to the train station. I asked him how he wanted to go. He told me how to get there. I said that was slow. I said to get on the elevated highway and go this other way. He said that it was a longer way. I said, ‘No problem. You have experience because you go that way frequently. It costs you 50 RMB. If you go my way, I will turn off the meter when it reaches 50 RMB. You can just pay me 50 RMB. Anything more is mine. If you go your way, it will take 50 minutes. If I go my way, it will take 25 minutes.’ So in the end, we went my way. We traveled an additional four kilometers but 25 minutes quicker. I accepted only 50 RMB. The customer was very delighted for saving about 10 RMB. This extra four kilometers cost me just over 1 RMB in gas. So I have swapped 1 RMB for 25 extra minutes of my time. As I just said, my hourly cost is 34.5 RMB. It was quite worthwhile for me!”

“In a public taxi company, an ordinary driver takes three to four thousand RMB home per month. The good driver can get around five thousand. The top driver can get seven thousand RMB. Out of the 20,000 drivers, there are about two to three who can make more than 8,000 RMB a month. I am one of those two or three. Furthermore, it is very stable without too much fluctuation.”

Great! By this point, I admired this taxi driver more and more.

“I often say that I am a happy driver. Some people say, ‘That’s because you earn a lot of money. Of course, you must be happy.’ I tell them, ‘You are wrong. This is because I have a happy and active mind, and that is why I make a lot of money.'”

What a wonderful way to put it!

“You have to appreciate the beauty that your work brings. Stuck in a traffic jam at People’s Plaza, many drivers complain, ‘Oh, there’s a traffic jam again! What rotten luck!’ You must not be like that. You should try to experience the beauty of the city. There are many pretty girls passing by. There are many tall modern buildings; although you cannot afford them, you can still enjoy them with an appreciative look. While driving to the airport, you can look at the greenery on both sides. In the winter, it is white. How beautiful! Look at the meter — it is more than 100 RMB. That is even more beautiful! Each job has its own beauty. We need to learn how to experience that beauty in our work.”

“Ten years ago, I was a general instructor at Johnson’s. Eight years ago, I had been the department manager for three different departments. I quit because there was no point in making three or five thousand a month. I decided to become a taxi driver. I want to be a happy driver. Ha ha ha …”

When we arrived at the airport, I gave him my business card and said, “Are you interested in coming this Friday to my office and explain to the Microsoft workers about how you operate your taxi? You can treat it as if your meter is running at 60 kilometers per hour. I will pay you for the time that you talk to us. Give me a call.”

Then I began to write down his lively MBA lecture on the airplane.

While this particular story has become famous through numerous links, there is actually a follow-up story on the taxi driver.

(6Park) Shanghai’s 8000 RMB monthly salaried taxi driver was attacked by colleagues.

[in translation]

“A man doesn’t want to famous just like a pig does want to be fat and strong.” The newly famous taxi driver Zang Qin (臧勤) experienced this saying in a personal way. Faced with the doubts, misunderstanding and even personal attacks by his colleagues, this “happy driver” has been living in puzzlement, irritation and helplessness without the peace and stability of his former life.

Last night, he told this reporter about his inner grievances: “Some colleagues only read that I made 8,000 RMB but they did not read about my hardship and efforts; I shared my ‘business wisdom’ over more than 10 years with my colleagues, so that all ‘taxi brothers’ can become rich. But I ended up setting off a fire that burned me. If I knew that this was going to happen, wouldn’t it be better if I kept my mouth shut and made money quietly?”

Ever since the “legendary experience” of the “8,000 RMB taxi brother” was revealed by the media, Zang Qin came to the attention of some colleagues and rumors began to circulate about him. “Originally, the management wanted to lower the requirements for the drivers, but this policy was shelved after he became famous.” “He must have some tricks, because he could not possibly make that much money in a month.” The “stories” were getting weirder and weirder. “Some individual colleagues even said that if they should see my car on the road, they would not hesitate to ram me,” said Zang Qin in fear.

“Driving a taxi is a high-risk profession. I appreciate the work pressure and living conditions faced by my colleagues.” This was the reason why Zang Qin was willing to take the risk of reducing his own income by revealing his service techniques and “business experience” so that “my colleagues can earn more money in the same amount of time.” But Zang Qin did not understand why certain colleagues did not want to learn from this customer selection method and service technique and prefer instead to stick to the dead-end rule of “depend on luck and the weather.”

After Zang Qin became famous overnight, many famous Chinese and overseas companies and higher institutions of learning invited him to “exchange” with “lecture fees” of 1,000 to 2,000 RMB. “I said before that I don’t want to be famous and I don’t want money. Since they respected me, I thought that I should represent the Shanghai ‘taxi brothers’ to meet these big companies and their workers. I want my colleagues to be respected and I want to elevate our social standing.” Zang Qin is perplexed that those people outside his industry respected his work enthusiasm, happiness, service technique and professionalism and considered a motivational force for their own jobs, whereas some of his own colleagues only cared about how much he made and did not pay too much attention as to how he manages to earn 8,000 RMB a month.

Zang Qing hopes that the citizens and passengers will have a better understanding of the taxi drivers. He said sincerely that a monthly salary of 8,000 RMB is an exception in the entire industry and he does not want his own high income affect the interests of all ‘taxi brothers.’ “After all, the reality is that many ‘taxi drivers’ are looking for other kinds of jobs. They need the attention and care of society.”

There is an unanswered question: If every taxi driver follows Zang’s method, how will anyone ever get a taxi at the subway station?


Scrutinizing the Singapore government

I haven’t been writing much due to work commitments. But after a long day at work on a weekend, the last thing I wish to read is news like this:


Source: Channelnewsasia

SINGAPORE: Prime Minister Lee Hsien Loong has cautioned Singaporeans to pay attention to new fault lines that have appeared between new citizens and native Singaporeans.

Speaking at Teck Ghee Community Club’s racial harmony celebrations, Mr Lee said new citizens may be ethnically similar, but fault lines may develop as the new citizens have different norms, habits and attitudes.

So he said Singaporeans must watch out for instances of social friction, especially online.

Mr Lee said new citizens and those born in Singapore must work together to ensure that differences do not affect social stability.

“The new arrivals – to embrace the Singapore values and norms and try and fit in as Singaporeans. And Singaporeans – to encourage…

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From about a year ago.

101 East – Aljezarra

Is Singapore ready for political change?

… is what Singapore needs. Why do people recognise brands such as Mercedes, Porshe, BMW, Heidelberg, Rolex, Rolls Royce?

In the days when Singapore was developing, our ministers were travelling overseas to attract talent as well as investments, with the investments came technology transfers that enabled Singapore to advance and avoid the steep learning curve.

It has been harder to attract new investments here as costs go up, and many corporations have shifted their operations to China, Thailand, Vietnam and more recently Iskandar Johor.

At the end of the day, it will be a $ sum game, whoever can provide the cheapest costs will get the investments and the ability to create jobs.

So where am I getting to? Attracting investments here isn’t going to be enough, everyone else can also do it. What we need to do is differentiate ourselves from the pack just as the Germans and Swiss have done, each of Brands mentioned above represents quality brands, brands that people across the world will pay premium for.

Any decent printer will only buy a Heidelberg for his printing press, why? Because of the quality, the precision, the hardiness of the machinery.

Why does our army (at one time) and many other armies use Mercedes benz trucks for their transport requirements?

Singapore needs to build on the experiences of her people, her sons and daughters, to develop the quality necessary for quality products and services. Reliance on the transient population will just not cut it. How many will actually stay to make a stand for this country, our country, my country. The experienced gained here in developing technology, workflow process, best practices, need to be kept growing here among the locals, the foreign talent will just move with all they’ve gained when when conditions don’t suit them, or when their kids reach university age and the have free university back in their motherland.

We need new ideas, lest we all end up being taxi-drivers or food court managers. (no offense meant to our taxi uncles).

So more experience, so that we may develop quality products that may one day say: “MADE and DEVELOPED IN SINGAPORE”.

Just to end, here is a video on how important experience is, the luck jar and experience jar:-8:30

Dun know why i cant reblog, so i copied n paste here to share. Hope u dun mind phil.

From Phil Ebersole’s Blog


Winds of change in Quebec

The Parti Quebecois has come to power in Quebec, after months of protests against the incumbent Liberal government involving hundreds of thousands of people, led by students but not limited to them. The new government has agreed to cancel university tuition increases, the original cause of the protests.

The new government also announced an indefinite moratorium not only on hydraulic fracturing for natural gas, but on exploration for shale gas as such.

It goes to show what a determined and well-led mass protest movement can accomplish.

Click on Quebec’s Not-So-Quiet Revolution for cartoonist Ted Rall’s graphic report on the Quebec protests.

Click on ‘A beautiful day’ for environmentalists for background on the shale gas issue from the Montreal Gazette.

K, so got a bit of inspiration to write, while i wait for some stuff to finish up at work.

We all want to provide the best for our kids (as best as we can afford), i send my kids to school everyday, so they don’t have to take public transport, it was like that for me too.

We try to get them whatever they need, whatever we can see that they will require. We hold their hands when we cross the roads and carry them when they fall asleep on those nites when we come home late.

Even when we are tired, we still find the strength to go on.

For some other parents, they make the trip every week to see their child in Changi prison, even if the child has done wrong, they still realise that it is your child. They still love their child. No parent would tell their child to “repent” or “rot in hell”, even when they have done something not so right in the eyes of the parent.

But sometimes are we too protective of our children, so much so that they don’t know how to tie their laces, cut their nails, wash their army uniform, use a washing machine, order food (mee siam got no hum ok?)

The G is similiary like a parent to her citizens, the people born here are sons and daughters of this land, we will be raised here, and for many probably die here.

So my point is, parents dont give up on their kids, they do whatever they can to maximise the potential of their own children first. They dont try to raise their neighbours child, unless they have so much money and dont know what to do with the excess (or they are sleeping with the neighbours wife). They dont put obstacles in the way of their child, in fact they even try to help to clear them.

In times of need, they encourage, provide support and show love (heart).

In times of failure, they provide (hope), ok cannot make it to local U, never mind, can go abroad.

So what does the G want to be?

(this post will need some edits later, cos i got on the train n lost my trail of thots)

Musings from Singapore

Dear friends, as long as there are significant information asymmetries in the government-citizen relationship, Singapore will never be able to have a completely fair and open national conversation.

What information asymmetries exist? Simply, the government has all the data and information, and we, the people, are given only selective access to it. Whenever people talk about the “lack of information” or the need for a “freedom of information” act, it is difficult to grasp what precisely this means in practice, and why exactly we need it.

Hence, in my humble bid to shed some light on this problem, I will adopt the same approach as I did last year, when I wrote a piece entitled “The problem with Singapore’s media“, showing six clear examples of institutionalised bias in Singapore’s media.

Here, I will show three clear examples of how the Singapore government’s stranglehold over data has blunted my…

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