Written
by Peter Li-Chang Kuo
(Chinese)
TSCM
is the abbreviation for "Transaction &
Transmission Supply Chain Management" information system. Its
R&D results were published under the title "Development
of a Supply Chain Management Information System for an Electronic Shopping
System" in the Ministry of Economic Affairs’ 2000 publication
"Compilation of Achievements from the 1998–2000
State-owned Enterprises’ Assistance Program for SMEs in R&D"
(hereafter referred to as "the Compilation").
Fig 1:
The thick volume of "the Compilation" was funded through subsidies
from Taipower, CPC, and Taisugar
In
1986, to address the problem of unemployed individuals who had turned to
driving taxis and were getting robbed, we invented the "TES E-Commerce System"— using the TranSmart Chip
Card and its "Transaction Reading Device"
(TRD) as the transaction tools, while the transmission function was entrusted
to “TSCM.” We began with COBOL and Fortran, and continued urging our suppliers
to develop numerous application programs—such as “Java,
Delphi, SQL, C++, XML,” etc.—until we finally brought the results to the
1997 Vancouver APEC, where we shared this groundbreaking, cross-century
invention with economies around the world.
Fig 2:
TES inventor Linda Din at Vancouver APEC 1997
Representatives
from various economies unanimously remarked:
“You should apply for patents for
your invention, so that when you try to solve unemployment, no one can come out
and cause trouble!”
Therefore,
in addition to copyrights, we also applied for invention patents and
trademarks.
Fig 3:
“TSCM 2000” trademark.
At
the 1997 Vancouver APEC, Director Li Chang-Yi of the SME Administration saw the
enthusiastic response from representatives of various economies to our
presentation on TES and hoped we would contribute our R&D results by
including “TSCM” in the Compilation, showcasing
that Taiwan
had finally produced an invention that led the world in the evolution of global
technology.
Fig 4:
TSCM inventor Linda Din with SME Administration Director Li Chang-Yi at APEC
1997
Excerpt
from the “TSCM” entry:
Main
Products:
Electronic
Shopping System Supply Chain Management Information System, Proprietary
Inventory Center Management Information System, and Group Control Module for
Vending Machine Groups and Contactless Card Top-up Machine Groups. The three
main sections: “I. Product Functions or Technical
Content; II. Applications of the Product or Technology; III. Results.”
I. Product Functions or Technical
Content:
1. Control Center
Management System Internal Control:
Includes control of vending machine groups and
proprietary inventory center machines. Main subsystems:
(1) Basic Data Maintenance,
(2) Sales Management System,
(3) Order Management System,
(4) Purchasing Management System,
(5) Shipping/Delivery Management System,
(6) Inventory Inquiry System,
(7) Stocktaking Management System,
(8) Stored Value Card Management System,
(9) Accounts Management System,
(10) System Management.
2. Proprietary Inventory
Center Internal Control
System:
Main functions:
(1) Control
Center sends purchase
notification,
(2) Receiving status returned to Control Center,
(3) Control
Center sends shipping
notification,
(4) Pick-up for shipping,
(5) Shipping processing,
(6) Shipping results returned to Control Center,
(7) Inventory inquiry operations,
(8) Inventory stocktaking operations.
3. Vending Machine and Contactless Card
Top-up Machine Group Control Module:
Main functions: To manage and transmit information for
vending machines and top-up machines, using dedicated lines or wireless
communication to transmit electronic transaction and product information back
to the Control Center.
II. Applications of the Product
or Technology:
This
product allows "electronic payments via prepaid cards, IC cards, or credit
cards," transmitting vending machine transaction and product information
back to the Control Center via dedicated lines or wireless communication. The Control Center, through its MIS (Management
Information System), circulates financial and information flows with financial
institutions and suppliers, while managing product sales data and inventory
quantities to grasp market sales intelligence.
The
product is designed for vending machines, which can sell beverages, food, newspapers,
daily necessities, groceries, employment information, computer software, and
many other products and services. It can be adapted for various applications
depending on the products or services offered.
III. Results:
1. Expected Benefits:
(1) Build and promote an around-the-clock, low-cost,
highly convenient unmanned sales system;
(2) Develop key technologies for unmanned shopping
(sales) systems to lay a solid foundation for the future development of
eCommerce in Taiwan;
(3) Unmanned shopping systems can integrate industries
such as electronics, machinery, information, optics, food, plastics;
distribution, and logistics, creating significant industrial synergy and
driving domestic industrial growth;
(4) The system can "reduce
distribution steps," create innovative product channels, lower
middleman exploitation and distribution costs, and provide a better consumption
environment for the public.
2. System development and testing have been completed.
3. Completion of management information systems for the
Control Center
and Proprietary Inventory Center,
as well as control functions for vending machines and top-up machines.
At
the time, because the public was not yet aware—so when we spoke of a “contactless, cashless e-commerce system” or “transactions automatically transmitting to the control
center for information processing,” no one understood what we meant.
Therefore, we installed TSCM and TRD into vending machines, creating “VAM” (Vending Automation Manager) as a physical
demonstration for the world to see, ushering humanity into a new era of
technological economy and creating a large number of new jobs.
Fig 6:
Linda Din demonstrates TSCM through VAM
We
combined our own funds with subsidies from state-owned enterprises, patiently
teaching a national university to handle the project, successfully including
this invention—which transformed human transaction and living patterns—into the
Compilation as a valuable national record. This truly advanced the “technologization of traditional industries and the intelligentization
of technology industries,” helping people earn money from the world
while working from home.
As
to "The Compilation of Achievements from the
1998–2000 State-owned Enterprises’ Assistance Program for SMEs in R&D"
(the Compilation) was part of the Ministry of
Economic Affairs’ program where state-owned enterprises allocated subsidies
from surplus funds to assist SMEs in conducting R&D. The program ran
between 1998 and 2000, and we were fortunate to be part of it.
After
completing the 1997 APEC meeting, we traveled from Vancouver
to Washington, DC
with Director Li Chang-Yi, where we met with the U.S. "Small
Business Administration" (SBA). There, Mr. Richard Ginsburg
mentioned that the U.S.
had a program to assist SMEs in R&D called "SBIR"
(Small Business Innovation Research). Through our efforts, Taiwan’s version of SBIR was also established,
leaving an indelible mark on the history of Taiwan’s industrial upgrading.
Fig 7
: Visiting SBA official Richard Ginsburg in DC
When
later speaking with former President Lee Teng-Hui about his 12 years in office,
he spoke with great enthusiasm about the reason why, during his tenure, “state-owned enterprises had such abundant surpluses that
they could assist SMEs in conducting R&D.”Summarizing the underlying factors, there were three
layers of policy logic:
1. Lee Teng-hui’s policy of “maintaining
monopolies in state-owned enterprises to ensure stable revenue sources”:
1) After assuming the presidency in 1988, Lee
discussed privatization but, in key energy and raw material sectors (such as
Taipower, CPC, Taisugar, and CSC), he chose to “delay
liberalization and maintain monopoly positions.” This allowed
state-owned enterprises to continue using pricing power and market protection
to accumulate large surpluses, instead of being forced into price-cutting
competition.
2) At the time, global oil prices were low, Taiwan’s
economy was still enjoying the tail end of the 1980s export boom, and the
higher authorities of state-owned enterprises provided full support. Operations
ran smoothly, and surpluses naturally rose year after year.
2. Policy vision of “using state-owned
enterprise surpluses to drive SME upgrading”:
1) In 1991, President Lee established the "National Development Conference;" in 1995, he
launched the Asia-Pacific Regional Operations Center Plan; and in 1996, he
accepted my “Incubator Plan” and rolled out an
innovation incubation policy, emphasizing industrial upgrading and
technological advancement.
2) He understood that SMEs were the backbone of Taiwan’s
economy but had weak R&D capabilities, so he supported the Industrial
Development Bureau of the Ministry of Economic Affairs in designing the “State-owned Enterprises’ Assistance Program for SMEs in
R&D.” This used the surplus funds of state-owned enterprises as a
capital pool—essentially a domestic version of an “Industrial
Policy Fund”—to prevent all surpluses from being turned over to the
national treasury and diverted to unrelated uses.
3. “Counter-cyclical” investment strategy
during the 1997 Asian Financial Crisis
1) The financial crisis hit Taiwan’s export markets, and the
Lee administration leaned toward using domestic investment and technological
upgrading to offset external downturns. This successfully absorbed the shock
and made Taiwan
even stronger.
2) Channeling state-owned enterprise surpluses into
SME R&D was a “counter-cyclical”
measure—using domestic capital to support industrial transformation and foster
new competitive strengths when external markets were sluggish.
If
Lee had not, in the 1990s, delayed privatization of state-owned enterprises,
retained their monopolies and surpluses, and directed these surpluses into SME
R&D, there would not have been as much funding between 1998 and 2000 to
support world-changing technological innovations like “TSCM
and TES.” Our ability to “be in the right place
at the right time” was due to President Lee’s industrial policy design
and his special arrangement for the use of state-owned enterprise surpluses.
In
1998, state-owned enterprises’ “remitted surpluses to
the treasury exceeded NT$ 280 billion,” with an overall net profit
margin of 10.15%, reflecting their healthy financial condition. This allowed
them to allocate retained earnings to subsidize SME R&D. Therefore, the
main reason these state-owned enterprises could “allocate
subsidies from surplus funds” was that, at the time, Taiwan’s
state-owned enterprises were performing well, generating ample profits, and
benefiting from government policy support and planning. This enabled them to
channel funds into assisting SMEs in R&D, driving industrial upgrading and
technological development, thereby demonstrating Taiwan’s strength and contribution
to global technological progress.
In
an interview with Mr. Huang Tien-Lin, a macroeconomic expert who once served as
Chairman of First Commercial Bank, he referred to his book "One Hundred Questions on the Economy" and gave
concrete figures illustrating Taiwan’s
prosperity in the 1990s:
“President Lee’s Six-Year
National Development Plan—during the period 1991–1996—achieved an average
annual GDP growth rate of 6.5%, an annual inflation rate of 3.7%, and a rise in
per capita GNP from USD 8,982 to USD 12,872.”
This
laid a solid foundation for Taiwan’s
development in the 21st century.
Entering
the 21st century, Taiwan
began to see growing social unrest. On January 27, 2001, our offices and
residences in both Taipei and Taichung were simultaneously robbed by a
cartel crime group— partly targeting “TSCM”
information system. The criminal investigator at the scene remarked: “This was definitely done by an insider. Just wait—whoever
uses it first is the thief!”
Fig 8:
Police incident report form for the January 27, 2001 robbery
Deficits reflect contradictions
Just
the other day, we discussed the persistent losses of state-owned enterprises in
recent years, which stem from a combination of structural operational
difficulties, policy factors, and external challenges.
First,
although at the 2023 COP 28 UN Climate Conference, 22 countries jointly signed
an initiative pledging to "triple global nuclear
power generation capacity" by 2050 as a means of achieving net-zero
carbon emissions, the Taiwan authorities still emphasize nuclear accident risks
and nuclear waste issues. They believe neither society nor industry can bear
the risks of a nuclear disaster. Thus, the No. 3 Nuclear Power Plant was
decommissioned in 2025, though a "referendum"
scheduled for August 23 will decide whether it should be restarted. Under such
political constraints, Taipower is like a skilled housewife unable to cook
without rice.
Second,
since 2021, the costs of power generation fuels such as natural gas and coal
have risen sharply—doubling after the outbreak of the Russia–Ukraine war. Under
the current pro-thermal power policy, Taipower has been unable to avoid losses.
CPC Corporation, Taiwan,
has likewise been hit by rising international fuel prices and domestic fuel
price freezes, leading to continued losses.
These
deficits reflect contradictions in Taiwan’s current energy policy,
international market volatility, and price control policies. For state-owned
enterprises, sound governance alone is insufficient to stop the bleeding,
resulting in long-term financial strain.
Summary
Former
President Lee Teng-Hui once said:
“During my presidency, I was
cautious every single day. During the 1997 Asian Financial Crisis, I maintained
close daily contact with the central bank governor, anticipating every possible
scenario and preparing countermeasures in advance.”
At
the APEC Leaders’ Meeting, Japan’s representative admitted:
“Japan failed to handle the 1997
Asian Financial Crisis properly, which is why we collapsed.”
President
Lee once gave us a copy of “Managing A Great
Taiwan” (Lee Teng-Hui, 1994) with the advice: “Think further ahead for Taiwan.” The policy environment
during Lee’s presidency supported steady surpluses for state-owned enterprises
and sustained industrial upgrading through R&D. From both political and
managerial perspectives, we have a positive assessment of President Lee’s
legacy. “There is nothing new under the sun”— today’s
challenges have also existed in the past, and by carefully studying the steps
taken by those before us, we can avoid the pitfalls.
Fig 9:
“Managing
A Great Taiwan”
(Lee Teng-Hui, 1994)
Future
leaders should learn from Lee Teng-Hui’s spirit and approach, specifically in
the following ways:
1. Heightened vigilance and crisis
awareness:
When facing the 1997 Asian Financial Crisis, President
Lee maintained close daily contact with the central bank governor, anticipating
possible difficulties and deploying countermeasures in advance. Future leaders
confronting the losses and operational challenges of state-owned enterprises
should likewise remain vigilant, stay alert to international economic changes
and policy adjustments, proactively assess risks, and prepare for
contingencies.
2. Holistic thinking and long-term vision:
President Lee stressed the need to “think further
ahead for Taiwan.”
Such a long-term perspective is crucial for state-owned enterprises. Future
leaders should look beyond short-term financial pressures and instead consider
issues in the context of industrial upgrading, innovation in R&D, and
comprehensive policy planning—avoiding a narrow focus on immediate problems.
3. Prudent management strategies and
industrial upgrading:
During President Lee’s tenure, state-owned enterprises
maintained steady surpluses and continued upgrading through R&D,
demonstrating the synergy between policy and business strategy. This approach
should be emulated to strengthen core competitiveness and self-growth capacity,
enhancing value rather than relying solely on price strategies to pass on
costs.
4. Effective political and managerial
coordination:
President Lee was able to earn positive evaluations on
both political and managerial fronts, showing his ability to balance policy and
operations. Future leaders should learn how to balance government policy,
energy price adjustments, and international market fluctuations to ensure the
continued stability of state-owned enterprises amid multiple challenges.
5. Learning from history to avoid repeating
mistakes:
Lee emphasized, “There is nothing new under the sun.”
Current difficulties have occurred before. Future leaders should review
history, draw lessons from their predecessors, and avoid repeating mistakes—using
historical wisdom to plan for the future.
In
sum, we should take former President Lee Teng-Hui’s prudence, long-term
planning, steady management, and adept political judgment as a model. To
address the structural operational difficulties currently facing state-owned
enterprises, we must adopt systematic thinking and strategic planning that
balance policy adjustments with market needs, in order to emerge from today’s
difficulties and ensure the sustainable development of these enterprises. Only
by going further can another "TSCM"
that benefits the world emerge from Taiwan.
Peter Li-Chang Kuo, the author created Taiwan's Precision Industry in his
early years. Peter was a representative of the APEC CEO Summit and an expert in
the third sector. He advocated "anti-corruption (AC)/cashless/e-commerce
(E-Com)/ICT/IPR/IIA-TES / Micro-Business (MB)…and etc." to win the
international bills and regulations.
【Copyrights
reserved by Li-Chang Kuo & K-Horn Science Inc.】
External Links:
https://patents.google.com/patent/US6304796 (VAM)
https://patents.google.com/patent/US20030197061
(Shopping System)
https://patents.google.com/patent/US20030107468
(Entry Security Device)
https://patents.google.com/patent/US20040054595A1 (ETC)
https://ldinventions.blogspot.com/2022/01/127.html (A Universal Cashless System)
https://khornhb.blogspot.com/2023/10/1011.html
(K-Horn Science Inc.)
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https://khornhb.blogspot.com/2023/12/1208.html
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(Disney Intelligent System)
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