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Thursday, December 14, 2017

Whose MBAH program is better - that of AGSB or those who do their programs off campus?

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
December 15, 2017


Image result for AGSB + MBAH


This author handled at least 5 MBAH batches at AGSB.  I thought an elective - Entreprenuershhip an elective which in effect covers the entire spectrum of management:  finance, marketing, operations, and even general management

I also heard about off campus programs of MBA hospital administration in our area because there are several hospitals that have sprouted all over the place. And may be DOH requires MD administrators to take up MBAH

I have been asked several times to assist some students with their case analyses and final paper.  As I interviewed the students regarding the approach and methods of instruction.  I realized how far away they are from AGSB methodology.   Theirs are pedagogical, rather than analytical.    I suppose the MBA that they took were equally shallow and has not transformed the students into high caliber medical directors.

Lately I have given horror stories of mismanagement  by CEOs and even Chair of distinguished hospitals with practices that are not in keeping with sound management practices and which puts to shame the grad school where they  took up their MBA.

Am I glad to have taught at AGSB, and was part of its history. Certainly one of the  best MBA schools in the country.  (May be during our time) and the new batch of Prof will level up that stature


Image result for AGSB + MBAH


Image result for AGSB + MBAH


Tuesday, August 1, 2017

A maligned tycoon is a visionary par excellence

Every generation needs a revolution - an entrepreneurial

Rizal Philippines
August 1, 2017


Image result for balesin island club



Image result for bobby ongpin a visionary

The return of a visionary

I attended a meeting today with one of the captains of the industry.  He used to head a large commercial bank, was the head of a govt bank, headed the bases conversion, was president of a govt north rail. project.  He celebrated his 76th birthday a month ago.  I regaled at this vision statements for the bank in his office, as we were dining in his office for a CK treat.    And he said nothing could beat a former govt official, a Harvard  grad for being a visionary, at the age of 82.   He said that the enthusiasm of the said person is infectious and the way he visualizes his project, he would seem to be only  22 years old.

Some of his outstanding achievements include:   the exclusive members only Golf residential project:  Highlands, then the Balesin in Quezon, an island project  At Balesin, he built a resort with several themes located in 40 hectare site leaving the rest of island, 92 % as virgin forest, with 40,000 coconut trees.  The themes are Bali, Phuket, St. Tropez, Costa del Sol, Toscana and native Balesin. He built the resort at a cost of P7 billion and one of the most sought after exclusive members only resort in the region:    Membership sell for Gold P2.2 million 7 nights free,  Diamond   P4 million 14 nights,  and Corporate 6 million 28 nights









Image result for balesin island club

Image result for balesin island club

Image result for balesin island club



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Image result for balesin island club
There is a companion Balesin at Patnungan island.  He will build 500 homes and villa, 400 room hotel, and a runway to accommodate jet planes.  It will cost him P5 billion to build

There is  a plan for 783 hectares members exclusive members only Alpha land Baguio where cabin homes cost P50 million each.  All ready he is in Europe to buy the logs.  Can you beat the guy for his visioning and entrepreneurship  There will be 300 cabin log houses and 50 mountain lodges.

Alphaland Baguio Mountain Lodges

Hearing these stories makes one realize how little we dream or make our vision.

D R E A M      BIG

Alphaland Baguio Mountain Lodges from IMC Collateral on Vimeo.

Wednesday, May 17, 2017

The business, marketing success secret revealed

Every generation needs a revolution - an entrepreneurial revolution

Image result for the customer is the king   


Image result for the customer is the king


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Rizal Philippines
May 17, 2017

What do you get from this story?   Having a lake full of Pesos:

The story is about prioritizing, when you fish:

1.   bait
2.   the fishing rod,
3.  fish processing
4.  lake?

I would like to think that this is marketing parable.  We often say that we are to be market oriented but most of the time we are not.  We are product or sales oriented.  This story says that we prioritize the lake, the market, where we can catch fish.  Thus a market research interview about the needs and wants of customer.



Of course the correct sequence would be:

1.  lake -  the market, where you can catch fish
2.  bait -   the product
3.   Fishing rod  -  your pitch, your promo
4.  processing -  the customer link bond to retain customers to get repeat sales

This is very consistent about my thesis for business success as gurus have all ready stressed:

1.  Peter Drucker -  a business is an entity that creates customer.  No customer no business.   Thus marketing and innovation are important function of a business

2.  Theodore Levitt -   Everything starts and ends with the customer.  The goal of business, all its functions are geared to satisfy the customer.

3.  Our belief - Customer service.  The customer is the king.     The customer is divine.  He pays our wages
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Related image

This is the full story:

Sunday, April 9, 2017

Business is about ROI, making seeds grow to bear fruits

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
April 9, 2017


Image result for dupont chart


1.  The basic equation for any investment in business is ROI - return on investments, return on capital. That is why we have the Dupont Formula

             GP/Sales   x   Sales/Total Assets   x     Total Assets/Stockholders Equity

              (Patong)               (Paikot)                         (Laway)

              Margin                  Turn over                     Leveraging

            When we cancel sales, and total assets, we are left with GP/SHE  which is the formula
            for ROI (we have to fail an MBA student in a panel defense, who cant have the correct
            formula for ROI)




               Our SEC requires Du Pont Analysis:

Image result for dupont chart

     1.1 To have ROI it is thus important to have sales, and asset turn over

          Margin (patong refers to efficiency) cost reduction.   You cant have  margin, if the basic business model is wrong, ie sales - cost = GP.  No matter how high your sales is, if your are selling less than your cost, you can never have patong.  It is the goal of every business thus to:

          Increase sales (through marketing and sales efforts)

          Reduce expenses, through efficiency, and canvassing lower cost of inputs

   1.2 Paikot

        Your working capital must be turned around.  It must produce sales several times over.  If it only turns one round, or less than that you cant expect ROI

       How do you increase turn over?

      1.  By having more cash sales  (how do you do this?  By offering cash discounts)

      2.  By having shorter collection period

      3.  By having dedicated collectors

    LEVERAGE (Laway)

  1.3  As much as possible, you cant spend 100% of your equity in your business.  You must employ OPM (other peoples money) or borrow.  Many top execs or industry leader, disdain using their own money.    May I call this the Meralco or Tony Garcia (of Philchem) formula.   Meralco was bought by the Lopez after the end of Laurel Langley agreement from GTU using the cash flow from operations to pay off the installment on the balance.  The cash flow from operations paid the equity.   the IPO paid off the loan for the D/P.   Tony Garcia showed me how to do it, when he bought a school using practically nothing of the money of the investor

    This is only possible if you recognize the risk, ie that the business would be profitable enough, generate the cash flow  to meet the agreed repayment period.  I had several deals early on when we had terms, and the cash flow from the business sales paid off the balance.  You must be decisive enough and bold to generate cash when the payment time comes.   During high interest regime, we cant have much of 1.3

The biblical stories and parables support ROI

Wednesday, April 5, 2017

Foreigners see a lot of opportunities in the Philippines, why dont we?

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
April 5, 2017

I met with a up and coming exporter of food products to Korea. He has partnered with Koreans, and they are selling many local products to Filipino community in Korea:   saging na saba, tilapia, bangus, boneless bangus, tocino etc.

One of their suppliers also a Korean, started five years ago with nothing.  Now he is a millionaire with a house in Alabang.  He started exporting through them Moringa, then tea from dried guyabano leaves.  (The Korean doctors discovered the the anti cancer properties of guyabano) and the coconut sap sugar.  For the latter they had a cooperative with the local mayor in Quezon, and they paid P150.00 per day for the coconut stalk cutter

Why does it take foreigners to see opportunities in the country.  I told long time ago to an acquaintance to start this business, ie developing suppliers in an island province like the coconut sugar, and other herbals.  We talk about so many herbals, but those who believe early seize the opportunity and make money from out of those ideas

One Korean I know has a vision of providing interment via crematorium.  He now has 14

Sunday, April 2, 2017

11 quotes from Steve Jobs to help you make a dent in the world, ie leave a legacy

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
April 2, 2017

Every one wants to be hero.  Every one wants to make a dent in the universe.  Like a pencil, we like to continue writing and leave a mark.

Our life is a canvass on which we paint the strokes daily hoping that one day it will be  a masterpiece which the world will admire.  A great work.  An OBRA MAESTRA

By sheer luck or sheer determination and drive and passion, some of us will be able to do that.  Some will not.

Here Tips from Steve Jobs on how to make a dent in the universe, ie leave your mark

Friday, March 31, 2017

Innovative creative, turn around ideas from a fmr classmate, multinational veteran

Every generation needs a revolution - an entrepreneurial revolution\\



Image result for emmanuel cabusao
Rizal Philippine
March 31, 2017




I met this morning at Glorietta a former classmate, also a public school product after 28 years. (Almost 45 years na kami since college)  The last time we met was when he was VP of media company.

He is now retired and we met for two reasons:   1.  old times sake, and 2.  ask his help run a business and get him on board as a director.


He shared with me a lot of things:

1.  He is active in youth leadership training as an Executive Director as one of the Knights of Rizal  He inspires them, and trains them to be future patriotic leader where love of country is prime concern;

2.  As a former toothpaste executive who was assigned in Malaysia, he quarreled with a Malaysian, because his argument was that the product needs Moslem certification.  However, he argued that when he visited the stores, the shelves had none of their product

3.  When he worked with a local media company, (and he was promised presidency)) he found it to be bleeding profusely?  Why?   Because according to him, there is a self inflicted wound.  In order to keep its rating up, it had to pay the dealers an x amount to tell the auditor that indeed their sales say is 500 pcs (instead of say 100) To top it all, the dealer had to return the unsold papers at the expense of the publishing company.  What if the papers come from Mindanao.  Well that amounted to a loss of P10 million a month.  He viewed the whole thing from a business finance perspective and simply had to stop the  practice.

Because the production cost of the papers exceeded the selling price of the papers, he had to change the Pulitzer formula:   he raised the fee for the ads, and added more ads by showing that they were really selling more papers.  If the cost structure is wrong the more they sell, the more they lose money

4.  At an insurance company, (non life) he said that they were a game changer.  He bypassed the traditional agencies in order to save com expenses, went by way of DSM, through partner banks, (to save also on expenses).    He employed tele marketers and after this failed then thats the only time they will go face to face selling



5.   He had good connection with IC because after they get an international award, they have photo opps with the Insurance Commissioner to honor IC with their achievement. They were the first financial services company to win Agora award for Marketing in 1993

With OIC commissioner


Even at the age of 66 he is innovative, restless, and impatient

Thursday, March 30, 2017

CFO Forum at AGSB 50th anniversary

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
March 30, 2017

Image result for AGSB 50th anniversary + CFO forum

The Department of Economics Finance and Accounting held last March 28, 2017 a forum of chief financial officers on what to focus in 2017.  This was held at the Auditorium Basement 1 of Ateneo Professional School. The CFO who were present  were Francis H. Suarez Jr,  EVP,   Jose Teodoro K. Limcaoco,   CFO of Ayala group, and the moderator, Ana Bess G. Pingol, the moderators and also  CFO of Federal Land, SM Land Rockwell Land,  Deputy CFO of Metro Pacific Investment  Corporation.

Image result for AGSB 50th anniversary + CFO forum

What were the views of the CFO?

Both are conglomerates:  both have organic growth from core businesses, but Ayala is one of the oldest, and GT an investment arm of George Ty, the controlling stockholder of Metro Bank is the youngest, and only 5 years old.

The discussion were mostly from strategic point of view, rather from financial point of view.

Sunday, March 26, 2017

Some critiques on the strama yesterday for MBAH

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
March 26, 2017

1. On the research facility -  A scientific game changing lab is bleeding profusely not because of its operational defects, but because it cant get support from the President, the doctors and the managers are quareling, the boss for the investors is blunt and unforgiving, and there is a lot of friction.  The strategy class does not handle  or delve on conflict resolution, and corporate politicsl

2.  Exercise on futlity  -  A GOCC is likely to fail in its mission as a cheap medicine procurement agency for the simple reason that the multi agency involved:  DOH DTI and the LGUS   (those are DTI, DILG, DOH)  will not buy from them, or that the admin code for buying , ie conducting the bidding that takes months even for their agency (these should not happen) That the student went through the ardous process of analysis can simply be solved by fiat or leadership move or a MoA wherein everybody promises to abide by the law.  And the law is clear (a simple case of insubordination, lack of communication, or cooperation)

3.  Family affair -  a student whose family owns a hospital proposes some brilliant analysis  and strategy.  But at the end of the day, nothing will happen and nothing will get done because her mother hates her, and sides with the other siblings,  her profession and her MBA cant move her mother to abide by her proposal.   The father on the other hand will not let go.

4. Some critical issues on revenue  - /This post appreciates more explanation on the data on the hospital in the south: 30% comes from PHIC, 30% comes from Diagnostics, and 30% comes from Pharma revenues, only 10% comes from admissions and board and lodging

It tells zillions that the hospital management and the strategist must mind the pharma, and diagnostics. That is why St Lukes and TMC makes zillions investments  for state of the art diagnostic sends their pharmacists to MBA, puts a pharma on every floor of the hospital, puts an ERP system for the pharma and that great relations must be made at PHIC, or beef our staff dealing with PHIC.  We should have had more time for that.

Since there are the main drivers of growth, they should guide the strategy and making the right decision

Some execs will remain as second in command and cant be strategists nor business owners

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
March 26, 2017


Some execs will remain as second in command and cant be strategists nor business owners/entrepreneurs.  Thats what the chairman of a large business told me.  He told me of  former senior officer he just got to run an operation.  From the way it looks, they are engaged in a constant debate or struggle, about the direction the business is to take.

How could that be.?"

Until I talked to the guy. He was sort of mayabang and kept on harping about his achievement. But take note that his former company closed in a big and embarrassing way and even boasted how he sold off some of the assets (for which he got some handsome commission). Despite his brilliance though, he cant see the big picture and aping the words of his chairman, which he could not fathom well.

I also observe my fellow panelists and their questions are shallow and often focus on the form (the scoring the matching of scores of this table with that table) and are not in depth analysis of the strama defense which must be searching, focusing on the critical thinking of the MBA candidate.

At the end of the day, and this is the defect of the course, the students come out with generic strategy that are more of the same, less of the same, that merely perpetuates administer the existing business, and in the strictest sense of the word, not really brilliant, strategic or game changing.

Some are country managers of multinationals. But their thinking is really that of subordinate who must report to a superior abroad.  

PREPREHO.



Strama defects - most writers can not connect FS and analysis, and strategy

Every generation needs a revolution - an entrepreneurial revolution

I was in 2 strama sessions this week:  one in the medical school last Tuesday, and yesterday at AGSB

I have seen this time and time again, students committing the same mistake, out of inexperience or lack of skills in financial. (as most do) It is only after 20 years of MBA that I learned the value of FS.

Thus the student will propose a plant or improvement, it no changes in FFE, in Balance sheet and cash flow, and no interest expense in P and L.  They all come together.  I

If they understand that strategy is about choice of resources and processes to reach an objectives, or a story of where am I now, where am I going, how do I get there, then they should see the totality of their work and connect, even the FS to their story

Tuesday, March 14, 2017

I met my former marketing professor at AGSB, former Administrator of SBMA, and now of Holy Land

Every generation needs a revolution - an entrepreneurial revolution



Rizal Philippines
March 14,, 2017


                                       Prof Jorge, Administrator Robert Garcia, and our business partner


Today, my business partner in Laguna, his son, and my daughter who is part of the management team went to Holy Land  at SBMA (near the entrance of Subic Freeport along Tipo Highway in Front of Seal oil station) this morning.

There I met my former professor in marketing at AGSB some 30 years ago (at H de la Costa) who just resigned from his post as SBMA administrator.  He used to be exec at RamCar group (the Petines family business)   He turned around SBMA from a net loss, to  a profitable one, restructuring its debt together with Joven Reyes, the CFO and COO (former AGSB classmate;  he was our class valedictorian)

His wife Maribi's passion is running and getting finances for the Holy Land, a religious shrine that features way of the cross, Jesus Christ life, and many more.  She is Jesuit bred and understands a lot about Jesuit reflection  We were drawing inspiration for inspiration for a religious shrine at our Holy Gardens Memorial Park

You should visit it this Holy Week.   You will enjoy its attractiona and the entrance fee is low.  A great way to observe Lent



                              I looked older than the Chairman who plays golf always


                          The Administrator's wife Maribi Garcia and the master planner Arch Florentino


Wednesday, March 8, 2017

Brilliant deal making from seasoned and veteran businessman

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
March 8, 2017

One of the companies which we oversee a memorial park in the north, is being wooed by a leading memorial park.   The first offer was rejected by my joint venture partners because it was  single digit million arrived at using present value.

The next offer which we discussed yesterday, made the offer 5x  the original offer, to be paid  levedl payment, over a period of 72 months.   If we do a PV of that payment, there would be about P12 million discount.  Our JV partners were salivating and wanted to grab the offer, except that they wanted to have at least 20% dp and the term reduced to 48 months

We have over 5,200 items worth over P40,000 each.   When they take over, they would sell our lots to pay us off.

Looking back analyzing the deal:

1.  We would lose about P96 million GP over the next say 20 years.   (that is after the op ex)

2.  We could do the same;  Discount our products down to 30T and they would sell fast, and generate over y amount of cash, flow, which would be 50% more than the payments to be made to us of x amount.  In other words the deal  is guisado with our own fat.  That is why they are balking on cash payment.  

Brilliant.  Whoever can think of such a deal?  One of the veterans of the trade, the former head of a chem company was thinking along that line all the time:   OPM and using 0 of their own money to get a business deal

However our marketing staff there is not that capable to sell the inventories fast

Monday, February 13, 2017

Managing Family owned business/corporation

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
February 13, 2017


From IFC - Family Business Governance Handdbook

Corporate Governance in Family Business



Image result for managing family owned business



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This coming Wednesday, I will be meeting a Board regarding questions on propriety correct way of investment by family members.  I and a lawyer will be consulted on the fairness on investment and dividends of family members on the business.

The laws of the land, the civil code, the family code, the Corporation code cant answer the query;  even management  and MBA stuff cant answer that.

Managing a family owned business is a challenge;  managing family relations and managing the business

They say that the first generation builds and grows the business, the 2nd generation enjoys it, the third generation, the nephews and grand children ruins it.

A/  There should be three governing bodies of  a family owned business each with varying compositions:

1.  Family council  -  to create and enforce Family constitution which contains

           1.  Family constitution  -   enlarging perpetuating the vision mission
                         1.  family members employment
                         2.  share holding

          2.  Family corporation institution

                        1. family assembly
                        2.  family council
                        3.  family office

2.  The statutory board  - to do the regular board meeting responsibility

3   The strategic board plan the future or the company to keep up with the times, and fend off competition


B.  FAT principle and corporate governance

     Fairness
     Accountability
     Transparency

C.  Succession Planning

Lawyers, judges cant solve the problems of family owned corporation although they are so many may be up to 80% of the total business in the country.  Many of them fall by the wayseide because solutions to their problems, mostly about family relations can be solved by the family members  themselves.  That is why Nene Soriano, Ricky Mercado (under the new Dept at Loyola on Family business) are having a great day consulting family owned business. So too Dr. Ed Morato who bills $2,000 per day





       

Sunday, January 29, 2017

Innovation at Omron

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
January 29, 2017

The Future of People and Machines
 - Yoshihito Yamada


The President of Omron Yoshihito Yamada spoke at NHK on the two things that propelled Omron, the maker of sensors and other innovative devices that changed the world we live in like cash counters, cash dispensers, ATM machine, portable BP devices automated ticket machine and many many more.

Yoshihito Yamada CEO of Omron at NHK at Direct Talk

They are innovation, and commercialization of those innovation

What do you think of this game changing ideas in a business?

The President used to be in sales and his project was the BP measurement devices.  They made a campaign to get people to use the device:  people should measure their BP to avoid heart attacks and strokes.   And their sales of portable aneroid sphygmo shot up.  Innovation is risky, and they had many failures too

Monday, January 23, 2017

China's strategy to jump start economy

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
January 23, 2017

Image result for China relocates migrant farmers to 3rd tier cities

From Bloomberg - rebalancing Chinas economy

NHK recently featured China's strategy to jump start economy.  It is moving development to 3rd tier cities relocating many migrant farmers from 2nd tier cities.  It is called hukou.  I t will help soak the excess housing in the 3rd and fourth tier cities, and create more consumer driven economy
How we wish we could do that as we legislate in creating cities, we should invite give incentives  to industries and developers to move to this cities.  Thus decongesting MM and evenly spreading  progress at the country side.  Some cities like Sto Tomas, Tanauan  Bacoor fall into this mold;  but others do not. (natural ;progression because of MM spill over?)

China has finally encouraged labor mobility following years of restrictions

But the documentary says that such move, sound as they may from macro economic point of view has dire consequences in the lives of the farmers.   Many simply can not adopt to the changes. The farmers former businesses are demolished and they are forcibly forced to move out.   There is lack of consultation with the those affected parties and lack of safety net to those affected. It would have been perfect.

We lack the thoroughness in the country to plan this way, and to give the same support to spread development and entrepreneurship across the nation

Sunday, January 22, 2017

Building and sustaining learning organization

Every generation needs a revolution - an entrepreneurial revolution

Rizal Philippines
January 22, 2017

Image result for fifth discipline

This post, entrepreneur, business executive has long implemented learning as one of its values (beliefs) in the organization that he has founded for more than 30 years.  He has believed that its all about getting better.

Thus he was not surprised when Peter Senge came out with the book From Slideshare - Fifth Discipline PPt  What is the fifth discipline?  Shared learning.   It is a process by which an organization encourages its members to learn, so that the organization continuously transforms itself.   Learning is defined as the steps by which an organization acquires new skills and knowledge to innovate and compete and catch with the times. Stability and administration of a on going business is yielding to change and innovation.  What is new gets old,  the present becomes the past

The Fifth Discipline by Peter Senge

What have done so far to encourage our people in the organization:

1.  Performance evaluation to require staff to :   submit 1 book report a month, 3 blog comments a month on its community blog (so that the staff know what is going on);  to require everyone to have a have a learning log (and to have at least 60 entries a quarter)

2.  To require all staff to undergo orientation and pass the exams .  No additional allowance shall be given unless this is fulfilled.

3.  To promote staff via merit for following:  with following steps

     1.  40 book reports   1 step

     2.  MBA  2 steps

    3. PRC license     1 step

   4.  Creating a manual, a software program  - 1 step

We can learn a lot.  WE cant be crazy. by learning    Right now we are using only 7%  of our brain power.  When we were growing up that was at 30%.  We can memorize the Bible or encyclopedia if we dedicate our passion and efforts to do so.  Our brain has 1 trillion neurons that can store bits of information and that can be interconnected in an infinite number of ways  more than quadrillion possibilities.  That is why humans have invented so many things to improve upgrade our standard of living.

Somebody said can we learn while working.  Kaya nga sinabi, the secret of success is hard work.  We cant improve in our work we cant improve ourselves if we do not additional inputs from the world:   internet, books seminars.

There was story about two brothers who were being chased by a flash flood.  One said run, the other said run.  The elder said:   Ok let us pray while we run.  We can learn while we work.

Those who lead read

This brings us back to the story about an exec, a senior exec at a major drug company who asked his subordinates as to what is the primary responsibility of a subordinate?  Some say it is meeting the required targets and outputs;  some say its about following the rules and regulations of the company; some say its about being loyal to the boss.

To which he said they are all ok but not quite.

THE PRIMARY RESPONSIBILITY OF AN EMPLOYEE IS TO IMPROVE HIMSELF.  How can he do that?  By learning new skills and knowledge to develop himself and his skills in his job so that he will grow.

We can only improve our production and output if we improve ourselves and learn new things.   If we keep on doing old things expecting different results, it is INSANITY  (Albert Einstein)