Editor, 

I'm reminded by your most recent article (Government keeps quiet ... Oct 5, 2015) of how this management restructuring of the boards for Public Enterprises (shared boards) scheme is an ill-advised business model.

Hon. Poasi Tei promotes this scheme as a new business model on a TV Tonga interview with Ms. Viola Ulakai, and repeated on other radio programs. In my professional opinion, this is an untested business model, and editorialized in the Niuvākai publication that it is doomed to fail.

Lawlessness?

The automatic "termination" of the boards' directors and chairpersons is being challenged on legal grounds. And rightfully so by women, nonetheless, Lady 'Eseta Fusitu'a and two others − may the force be with them.

But the most embarrassing scene is when Prime Minister 'Akilisi Pōhiva demanded in Parliament to squash these ladies' legal challenges by passing a law to outlaw the ladies' refusal to resign. The PM seriously demanded "putting the law aside while the Executive Branch of Government does what they want done." 

Thanks to the wise advice from Speaker Hon. Tu'ivakanō: Reminding Members of Parliament (MPs) of their duties to legislate and respect the law of the land, and without the law there will be chaos.

"Shared Boards" a Flawed Business Model   

Outside of the legal battlegrounds, I present the following business principles why the "shared boards" scheme will fail:

     (a) Hon. Tei claims that the new "shared boards" will promote competition for higher profits, and service efficiencies.

     (b) Shared boards will not promote competition: Competitive advantages are not micromanaged by a board of directors from "central planning," but by each company outperforming the competitors.

     (c) Most of the 15 boards are either monopolies, or quasi-monopolies: Consumers have limited choices between products and services; they're a captive audience.

     (d) Prices are not driven by supply-and-demand: There's only high demand and short supply; results are high prices; only added value to customers (end users) is reduced prices.

     (e) CEOs are not loyal to their boards: They are loyal to their "agency principles" of management; they manage according to their specialized experience, and training to maximize owners' (shareholders) wealth.

     (f) CEOs cannot be intimidated by an authoritative board, which may try forcing them to adopt someone else's "best practices."

     (g) Hon. Tei claims these enterprises can be cross-trained to be "cross utilized:" Hoping to trim costs will result in work overload, over-stressed workers, and workers dissatisfaction.

Sione A. Mokofisi - mba

Director English-Journalism & Languages

Moana University - Formerly Tonga International Academy