My Company Will Be Undergoing Restructuring. What is My Backup Plan?

For most of us, the economic downturn is not doing the world well as far as our financial stability is concerned. In the coming months, I am expecting more jobs to be shed, and household income to either shrink or will not grow as fast as from the previous years.

As for the company I am with for the past seven to eight years, our financial woes started last year. The good news is after months of discussions, our Group has finally been bailed-out of troubles with new owners and investors, with the backing of the government. While the financial situation is stable now, restructuring is imminent. It has already been announced that, in order to return to profitability, many jobs will be lost. I expect at least 20-30% of the workforce will be cut, after the summer holidays.
While Asia Pacific business is still coping reasonably well, I do not expect we will be excluded in the retrenchment process. With my “prepare for the worst mindset”, in fact, I expect that Singapore office will face the “axing reality” sooner, because we have no unions here to protect our “rice bowls” unlike in Europe where laying off process is more complicated and will take a longer time. Hence, my job together with my colleagues’ jobs here is not guaranteed. And with my wife already resigned, we anticipate tougher times ahead. That said, we are all ready to weather this storm and have faith that we will come out of the storm unscathed. 
Despite the possible career calamity, I had my backup plans. Those who know me, will know that I will always prepare way ahead of a calamity. As a matter of fact, I had already anticipated for this type of crisis to happen since five years ago or even way before that. Thanks to the 2015 oil crisis giving me the head start warning.
To back up my thinking, I had built up a relatively sound finances over the years. Aside from my investments in shares and precious metals, just the cash alone, should be able to last my current expenses for more than two years without income from employment. Our rental income, dividends and interest received should provide some minimal help also, but definitely not sufficient in view of my huge household expenses.
I am also all ready to cut expenses by at least 30-40 percent in the worst case scenario. This is already proven viable from the experience of lower expenses as a consequence of staying at home in the past months. For instance, I will cater less extra income to my mother-in-law whom I already paid her handsomely in the last ten years. We will eat more simply and will have less outside meals and less personal entertainments. If that is still not enough, then my child will have to sacrifice some of their enrichment and sports lessons. I can also lower my charitable expenses. We had also successfully apply to withhold mortgage repayments which can help for at least half a year. I am driving a COE car which has already been fully paid and still can drive for another 8 to 9 years. 
That said, I cannot plan my BACKUP PLAN based on the fact that we are without household income and just living on dividends and savings and keep on cutting my expenses. THIS IS NOT WISE. This is the worst scenario but it should not be the immediate backup solution. Imagine you are running a business, and all you think is cutting cost and using your cash balances to pay salary and fixed costs. It will be disastrous. Instead you should always be thinking how to grow your revenue or have diversify forms of revenue from different segments, in case one segment collapse.  
My backup plan mentioned here is to start my own on a partnership early next year with a close friend. This friend is very entrepreneur and already have a stable and sustainable business. Furthermore, this friend has a heart of gold and is so unselfish in helping people around him. He had also gone through many difficult times in life, but each time overcome it to become stronger. I have utmost respect for him as a friend, as a father of a four kids, a good husband and as a boss of more than hundred staffs.
I believe that God helped me out of nowhere to know this friend years back, and led us into a very close relationships through His ways. In a way, we started discussing about business collaboration sometime back, when my current company’s financial woes were announced. This fortifies my belief that it is God’s plan due to the perfect timing.
Of course, in order for heaven and earth to help me, I knew I have to keep on walking on the righteous path, even if it means sufferings for myself and my family in the short term. According to my friend and potential partner, aside from my supplementary work expertise and experiences, it is really my righteous attitude as a genuine and loyal friend, plus my courage to speak the truth, that most appeal to him. Hence, the invitation to partner.
What is even more exciting for me is that it will be a totally different business endeavour. It will no longer be in the manufacturing sector, nor have focus in the maritime or oil energy industries. Instead, the new endeavour will focus on business related to technology and essential services. For example, Internet of Things (IOT), Data analytics, Food and other essential services etc. I can say that if this discussion is successful, it will be the start of my second career, something I had not plan for at all, yet, had often times think about it.  I am excited for it. 
Nonetheless, while all seems positive now, there is always a chance of agreement not going through up to the last stage. I cannot discount that. In addition to that, while my friend agrees to pay me sufficient salary before this business becoming profitable, I expect pay adjustment downwards to be significant.
To start my own, I also carry huge risk of giving up my MNC experiences to enter into a smaller business venture. This will mean giving up a job with good income at a senior position, and forgoing all the good relationships with colleagues and all the respect I had in the current company, which I had painstakingly built for the past many years.
Furthermore, I may need to give up many contacts in my current industry which I had conscientiously built for almost the past two decades. To alleviate this regret, the truth is, many contacts has already left the industry during the oil crisis. What also bode well for me is that a lot of contacts will still be useful in the new business venture in terms of regional coverage as well as their companies’ technological needs.
It is without doubt, that there can easily be a chance that the new business ventures will not take off or will not be successful. Or both my partner and myself does not agree eye to eye and eventually go on separate ways. I already plan that If this career back up plan does not work, I can always go back to being an employee. With my experience, age and humble eloquence in interviews, I do not think it is that difficult. Frankly, I had received and declined similar or higher career position interview invitations lately, even when I am not actively looking for any opportunities. Also, perhaps in the midst of the failure, I will learn new things to be able to start my own venture in a more successful manner. Or at least with my current finances, I am still able to work out something viable after the failure. I definitely hope that big failure will not be the case here though.
Humbly speaking, I am not saying I will be successful, but at least I have gather the skills, calmness, patience, experiences and more wisdom, which I felt I am more ready now to start this new business venture. Also, I feel that you can have a higher and faster success rate in your own venture when you have relevant work or life experience track records to speak of with at least good backing in financial ability. This is aside from the drive and hunger which are all important.
My current job began with me as the first Asian employee seven to eight years ago setting up the office from scratch here. Furthermore, I also had prior experiences holding P&L responsibilities in MNC and public listed company. Hopefully these past experiences will help. To top that up, my involvement in all functions of a business, from sales, marketing, finance, HR to project, engineering, commissioning, and after-sales services should come in handy in running my own venture.
It is in my opinion that you will never know what is going to happen in the road ahead until you dare to take a step out of your comfort zone TO START! After trying, you may fail, but you can also review and improve and eventually to better it more and more.
I know most readers and writers here are looking at successful investments plus dividends to achieve your FIRE (Financially Independent, Retire Early). But frankly, if you are always an average middle income earner, it is not that easy to build a portfolio big enough to have dividends that can sustain your living expenses including unexpected expenses that may crop up in your life. 

Unless, you have a rich enough parents supporting or leave behind money or properties for you, and you prefer to really live on minimal expenses and prefer to be single or at most married with no kids, it is not easy to be FIRE in Singapore in your 30s. I am not throwing wet blanket but this is the truth. Many of you readers may argue to me that many bloggers here are able to FIRE young, but the truth is you simply do not know the real situation behind the portfolio posted.
For now, let’s assume you are middle income earner, want to get married and have kids, so my question in this article to you is,
Have you already drawn up your career back up plan? If not, you should have at least some backup plan aside from the finances set aside during your wife or your unfortunate retrenchments. 

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20 thoughts on “My Company Will Be Undergoing Restructuring. What is My Backup Plan?

  1. Hey Rolf, hope things turn out OK for you. Otherwise, it looks very clear to me that you have already done the necessary planning. I really like it that you highlighted the context behind each FIRE story is different.


    1. Hey Kevin, always heart-warming to receive your comments. Not sure why, but for many years now I always feel your articles in ur blog also resonated with my thinking of outright truthfulness with nothing much to hide. Yes, I am afraid that sometimes readers see the book cover but forget that the behind the cover, there are more stories. Don’t get me wrong, I think FI is important but we must also be realistic and not over rush into it. RE should be better define, for e.g. after FI, we can serve charity, community or go into non-profit work to help others, or simply doing meaningful things we love as a form of work.

    1. Thanks CW8888. Perhaps remind you of our different taps of income! One tap if clog, there will be no water or water will be contaminated. Then too late to build another tap.

  2. hi Rolf, All the best, what comes may. In the end, your company might not want you to leave.

    U made me think harder of my own exit plan if it happens. Before Covid 19, I did meet up with a potential partner to start my own center. Really didnt work out, but that session let me gain plenty of insight of my shortcomings in the "business/private" world.

    Wish u 柳暗花明又一村

    1. hi Rolf, All the best, what comes may. In the end, your company might not want you to leave.

      U made me think harder of my own exit plan if it happens. Before Covid 19, I did meet up with a potential partner to start my own center. Really didnt work out, but that session let me gain plenty of insight of my shortcomings in the "business/private" world.

      Wish u 柳暗花明又一村

      Hi SI,
      At least you did think about it, and at least you did talk to the potential partner and action was taken. Whether it is successful or not, at least you try and learn from it. I think maybe you should get a partner that is genuinely trustworthy and good in the commercial aspects of the business. Then you should focus on the technical aspect since that is your experience.

      The courage is important. Actually I was just talking to my family member about the choice of partner. I told my gal that choosing a project partner is better to choose one who is totally different from her, although normally kids tend to choose project partners who are too similar to them, which is not that good. For e.g if you are lousy in technical such as programming, but good in presentation, you should choose an IT geek as your partner although, both of you may not click as good friends.

      For instance, my potential partner and myself already have partnerships before. We are very different in our expertise and character. But both of us are engineers. He is good in all the technical aspect of the business, while I am more apt in the commercial especially contracts and POs, terms and conditions. I am more outspoken, but he is less. He is very entrepreneur and can find many opportunities and do many different businesses in a single time. But I prefer to be more focus on what it matters most, one at a time. He hates writing emails, and everything verbal on phone and whatsapp while, I am better when it comes to black and white protection. He has very good experiences in many different business within few countries in SEA, while I have more international experiences.

      BUT we do share the same CORE belief of integrity and truthfulness in business, and that earning the MOST MONEY is not the most important. Esp, making quick money by exploiting the loopholes of the society and relationships, and at the expense of others is NO NO NO! We rather don’t want the business and struggle with poor finance. We believe that the drive of the success of our business is to share the fruits in the business with the people around us.

    2. Hi Rolf,
      Thanks for your insight. After talking to her, and subsequently different people, I get the feeling that the technical aspect that I offers is easily "bought" and hence there is no need for "partnership"

      I did read up more on the commercial aspect and meet more people to listen to views. So i believed my exit is a one man show. One man show doesn't earn much, but if done well, should ensure my family are well taken care of.

      After my change in role, I was much happier working, so that plan went into the back burner. But thanks to article like yours, we should not take things for granted.


      Sorry to have shift the chat to me. Hope u are alright and will gains greener pastures

    3. Hi SI,
      No shit chat. I enjoy hearing your experience. Glad to hear that you are happier now with the new role. The good thing is that at least you did think and talk to people about the exit plan. I am alright, and I am optimistic that there are sure to be solution. Lastly, your v chim mandarin always made me google 居安思危…

  3. Rolf, i always liked to read your article as i find it down to earth, realistic. May God bless you and family with good health, peace, joy

    1. Hi, thanks and I am really appreciative of your generous comments. The joy of appreciation from reader is more than the appreciation of the value of my stock portfolio. I also wish you good health, blissful family relationships. God bless you with love peace and joy.

  4. Rolf,

    From one shepherd to another, there's nothing more to be said between us except perhaps a knowing nod or salute to each other.

    Like two warriors crossing path – one moving towards the battlefront; while the other is retiring from his fighting days…

    1. Hi Jared, it's been awhile. I had been at the battlefront for my entire career, since I am either more involve in sales or on site services. Why are you retiring from your fighting days so young when TCB is still fighting to win election at 80. 🙂

  5. Thank you for the article, have been following your blog for some time and happy to see you are more active in blogging this year.

    Not a lot of people have the courage and opportunity to do a career switch I comment you for that if you would go that route. But at least wait for the restructuring / severance and not resign 🙂

    1. Dear Pete, thanks for your support n encouragement. I will love to have the severance if there is. Yes, I will likely wait for that if it comes. But if I am not "butchered", I am also consider leaving as I already spent close to 15 years in corporate MNC which comes to a point that I wondered if I can really be happy if I carry on another 15-20 years of corporate life, without a taking a gamble now!

  6. Hi Rolf,

    Before I egg you on, I feel more comfortable putting on a warning sign that most start-ups fail. I'm sure you already know this, of course.

    You are a much better person than me. Many years ago when I was worrying about job stability, my backup plan was to live off on my investment activities. In contrast, your backup plan is to start your own business. If you succeed, jobs and useful products/services will be created. That is true wealth creation. When people like me succeed, little quality wealth is created because what I do is mostly a zero-sum game. Investors living off dividends don't create quality wealth. Rather, they participate in the wealth created by entrepreneurs/employees. Traders making profits in the secondary markets are playing a zero-sum game.

    Singapore and the world will be better off if we have more people like you -> Role model in the financial blogosphere.

    I have some past engineering experience with IoT and some knowledge in data analytics because of my interest in this topic. You can contact me(check my blog for contact details) if you need someone to discuss about these technical stuff. I'm not sure about the value of my technical advice, but it's going to be free, for sure.

    I sincerely hope you succeed.

    1. Hi Hyom,

      Thanks for your great comments.
      Yes of course, I agree with u completely that most start up failed. You are not egging. It’s the truth.

      My plan here of starting my own does not mean the product is completely new. Actually it’s more like partnering with my friend who already have the solution, product and expertise that existed for many years with track records. Just that it is not in Sg. So my task is made simpler by creating a JV company here, to push and grow the solutions into Sg and the rest of the world.

      There is absolutely nothing wrong with living off investments/dividends. It is a very commendable effort if your expenses can be covered by your investments. I applaud that. Nonetheless, that is not really what I want and also maybe my situation is tougher as I am supporting now financially quite a number of people.

      Furthermore, I love challenges and new things and growth. So hopefully having starting of our own will realize this passion in a more unrestrictive manner. But I am sure it will be tougher.

      And yes, hopefully, more jobs can be created for Singaporeans! But our ultimate vision is to focus on charitable cause, if we ever can retire from the business world.

      Great to know your expertise in IoT. If ever, we started, I will let you know.

      Thanks for the well wishes. Stay safe and healthy.

    2. Hi Rolf,

      Your product sounds promising. It has a successful track record somewhere else but it's not available in Singapore. In other words, you have a potentially winning product with no competition when you introduce it in Singapore. Sounds like a winner. Haha.

      Of course, there's absolutely nothing wrong living off investments/dividends. I try to see things as they are but not in a way simply to make myself feel good to patch a hole in the heart. The fact remains that the world we live in today is better off because of our enterprising ancestors who were willing to pay the price to start new, risky businesses selling useful products/services. I will be happy to be of useful value to these kind of people.

    1. 不敢当 Fc. Seriously, I think if the venture ever took off and grow, I will contact you. After-all we shared similar background in career/education.

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