Keeping your cool amidst crisis: The CEO can’t afford to panic

 

Our class had its first case study “The COE can’t afford to panic”.  The analysis is not just about coming up with the best course of action from a business perspective but also considering the ethical implications of one’s decisions.  The Kaspa Gerald Smarten, CEO of Kaspa Financial Services (Kaspa) is having a dilemma. While presiding over the usual Tuesday meeting of the company, a bomb exploded at nearby train station causing confusion, uncertainty, and even fatalities on the area. Given this circumstance, the city requested whether Kaspa is willing to help to the community by providing its space to become a triage center and a temporary morgue. Standpoints of the members of the management team also exists at this point with some agreeing to the city’s request and others arguing against it.     Smarten as the CEO has to make an important decision in a short period.

Our group assessed the case using the Marrkula and Triple Bottom Line Frameworks, the group recommended for Smarten  to offer the company’s lobby and cafeteria to the city to help the victims of the subway bombing incident.

The group believes that going beyond the boundaries of the ordinary course of business, as traditionally set by society, is the best action to take.  This is because in the realm of ethics, moral conscience and civic responsibilities are expected to be exercised and mere compliance with regulations and a good achievement of one’s financial performance are outweighed by different things affecting society.

The business arena is getting more and more competitive and managers, especially CEOs must be in the forefront of making an effort in differentiating their organizations from the rest.

 

 

 

 

 

 

Learning from the Pro

What will get our of listening to a CEO with decades of experience under his belt? A lot.

Mr. Ramoncito Fernandez, the current CEO of Maynilad Water Services Inc., has definitely taught us a lot during his talk.  Mr. Fernandez has been in several industries and that only made a well rounded and competent.  He managed packaging, telecommunications and even government regulated business tollways.  Different businesses have varying systems and landscape and it honed his management skills.

While he had shared so many useful insights both in business and in life, there are a couple lessons that stuck to me until this very moment:

  • When leading, do not forget your advocacy. Just because you are so busy with your career it doesn’t mean you will no longer champion your advocacy.  You can still make it work.  In his case, he kept on promoting the engineering technical field by sponsoring scholarships.  It is also another way of adding vale to the corporation.
  • Management, especially leadership, is a life long learning.  He might reach the top of the corporate ladder but it didn’t stop him for doing and learning more.  Interaction with new people and engaging in a different situation also brought new knowledge   In life, we may think that we already know everything there is to learn only to realize that we know so little.  It is only prudent to be as eager to learn something new as you were when you were just beginning.
  • Know when to let go.  A leader has to know when he has to stay close and when to let a subordinate fly on his own. It is alright to let your team make decisions on their own.  If they made mistakes, it is also part of the learning process.   We don’t have to always be there all the time.  We have to learn to have faith in people, knowing that the will do what is best not just for them but for the organization.

The CLFG way

Maria Ester “Maret” Follosco Bautista is not your ordinary businesswoman.  She is not simply busy making money for her businesses she also make sure that her efforts contribute to the national development.   A daughter of a visionary, Ms. Bautista works hard to continue her father’s legacy.

CL Follosco Group came from humble beginning as Ms. Bautista shared during her talk.  Dr. Ceferino Follosco established Alpha Machinery & Engineering Corporation in 1996 with minimal capital and only a P.O box address in Manila.  The founder’s efforts paid off and slowly his sole business turned into a group of companies and was incorporated as a holding company in 2009.

Ms. Bautista’s talked centered on these topics; her father and his legacy, CL Follosco Group’s effort to contribute to the national development and family values.

Ms. Bautista’s regard to her father is apparent in the way she speaks about him.  She shared how her father started a business and how he made it grow.  She talked about the values he inculcated in her and her siblings.  It is evident that Dr. Ceferino Follosco’s legacy will stay long after his gone because his family embodies it.  As she goes further into her talk, I realized exactly why she is so proud of her father.

CL Follosco Group’s is more than just earning profits, it is also keen on helping the country.  Most people see national development as something that only concerns the government.  We see so many things to improve on but we rarely do anything about it.  CL Follosco Group of Companies is different.  They works hard to contribute to the national development of country and it is not as simple as providing jobs to Filipinos.   They also go to far flung provinces and see if there is something they can help the local with.  Since the business specializes in industrial clustering, they also employed the same idea to some provinces they have been.  One of the fortunate ones is the sardine industry in Dipolog.  The sardine community used to work independently and as result they produce products that varies in sizes, ingredients and packaging.  With the help of CLFG and funding from DTI and JICA, the industry  now have a common facility, uses the same oil and produces same sizes of bottles.  It is also their way of unifying people.

Ms. Bautista also shared her family values and how it was intertwined with the business.  They have policies that govern them on how to run their business and because they stick to their core values they don’t a hard time following said policies.  The next generation don’t have it easy just because the business is working well already.  They also have to work hard and contribute to the business such as coming up with new business ideas.  Every member of the family is expected to do his/her part and not simply live off the family’s money.

One of the key take aways from her talk is that business models can be innovated.  You can come up with your very own business model by considering your resources and values.

 

Grace under Crisis

Keeping your cool amidst crisis is one of the most essential traits of an effective leader.  Our class had its first case study “The COE can’t afford to panic” where a financial firm found itself in a middle of a crisis.

The case analysis is not just about coming up with the best course of action from a business/financial perspective but also considering the ethical implications of one’s decisions.  The Kaspa Gerald Smarten, CEO of Kaspa Financial Services (Kaspa) faces a dilemma.  While his team is on a company meeting of the company, a bomb exploded at nearby train station causing confusion, fatalities and panic around the area.  Give the scenario, the city  government requested Kaspa to let them use their lobby and cafeteria spaces to be used as a triage center and a temporary morgue.

Smarten is torn between doing what he think is best for their clients and fulfilling his ethical duty to the city and its people.  Smarten has to consider the the company’s reputation, safety of the people, morale of the employees and confidence of their current and future clients.  He also has to look at the long term negative effect or benefits of his decision.  Smarten need to keep his cool amidst chaos and pressure.  He  need to talk to his team and asked their opinions and listen to their arguments.

Our group’s recommendation is for Kaspa to allow the city to use their lobby and cafeteria as triage center and temporary morgue.  There would be pros and cons associated with this decision but at the end of the day, I believe that it is the best course of action.

The case study is centered on crisis management and as the scenario unfolds it clear that being a CEO is a job that not for everyone.  You have to stay focused, level headed and must not give in to panic.

It is very important for an organization to be ready for crisis.  They have to make sure than a crisis management team is well capable of handling situations that threaten the integrity of reputation of the company.  The team should also have a plan and they can do this by coming up with possible scenarios and coming up with ways to deal with those situations.   Good communication is very vital during the crisis.  A proper channel of communication must be identified to be able to control the situation avoid confusion and panic.

 

 

 

 

 

 

 

The new kid in the automotive block

Time now to write about our third speaker for this course, CEO series.  The past two speakers have made huge impression on me both as a CEO and an individual.  I was again looking forward to listening and talking to another industry expert from the automotive sector.

Mr. George Chua  earned his MBA at UPenn’s Wharton School and took Mechanical and Industrial Management Engineering at De La Salle University.  He held several top management positions in several companies such TIPCO and Armscor in the Philippines. He is currently the President and CEO of Bayan Automotive Industries Corporation (BAIC).

chua-solo

Mr. George Chua

 

BAIC is known for its tagline “better and ingenious choice” which we can see through their variety and yet unique designs and selections.  BAIC shows excellence through their Italian design, German engineering and Chinese manufacturing.

My group had the opportunity to introduce to the class and I can’t help but be impressed with both his professional and personal accomplishments.  Mr. Chua is not the traditional CEO that I always imagined.  He was very passionate about life and always busy doing so many things without neglecting his personal happiness.  He loves car, motorcycles, guns and golf.

Mr. Chua shared his Successful CEO requisites with the class and we all keenly listened.  Here are some of them:

  • Acquire education and training at every opportunity.
  • Working smart is better than working hard.  Always ask yourself if there is a better way of doing it.
  • Efficiency is key.  Multi-tasking and starting things simultaneously is very efficient. It’s like planting all the trees at the same time.
  • Networking is essential.  Mr. Chua does not simply play golf because he enjoys but also to talk to fellow businessmen in a more casual and personal setting.
  • Timing is everything.  One should be willing to make bold decisions at the right time

These requisites helped Mr. Chua reached the status he has now and are vital to his success.

My key takeaway from his talk is to make every experience count.  It was like a reminder to me to never waste my time on things that I don’t like doing or something that I will not gain anything at all.   I’d be better off doing things that I am passionate about and will bring positive impact to the people around me.  Time is finite and the best way to make the most out of it is to do things that (a) I am passionate about (b) learn something new or improve my skills (c) will help other people and the society as a whole.

chua-with-class

Mr. Chua with the class

Integral Human Development in Business

 

We had our first speaker tonight and it was night full of inspiration and laughter.  I was so excited to attend the class not just because it is our very first speaker but because our speaker is a woman and represents a Filipino company.

Ms. Yolanda “Yoling” Sevilla.   Ms. Sevilla has been an entrepreneur for more than 30 years and the CEO of the Leather Collection.  She fondly shared that The Leather Collection is the grandchild of the first company put up by her husband more than 30 years ago and it was partly because of boredom that they got into manufacturing leather goods.  The Leather Collection is a leather goods manufacturer and has been providing the executive accessories and business gift requirements since 1991.

Image result for yoling sevilla the leather collection

Ms. Yolanda “Yoling” Sevilla, CEO of The Leather Collection

Her talk was just not about a successful business that withstood the test of time but a story about community, relationships, transparency and trust.

What resonated with me the most is how they incorporated Integral Human Development in their company’s operations.  I had first heard about IHD from my professor in Management Action Research, Dr. Benito Teehankee .  While I believe that the framework is laudable I always wondered if business owners actually put said model into practice.  Most businesses look at CSR as something they will only take part in once they achieve a particular financial status.  Imagine my delight when Ms. Sevilla started talking about her company’s kabalikats, the efforts they made to help save the environment and their initiatives involving women from the far flung provinces that are badly in need of assistance.

Ms. Sevilla credit their working and personal relationship with their “kabalikats”, not employees.  Their kabalikats are enjoying regular employee status instead of being paid according to their output.  Employee compensation does not only come in a form of fair wages but also through values formation, skills training and continuous learning and improvement.  The company have looked out for their kabalikats even during the financial crisis.

Integralhumandevelopment

The Integral Human Development (IHD) Framework : addressing every aspect of a person to achieve true progress.  

I am always at awe whenever I come across organizations that is just after the traditional bottom line but also look after their employees, community and the environment.  The way The Leather Collection treat their employee is commendable. They don’t simply provide them a source of income but also help them boost their morale and self-esteem.  They call their employees kabalikat.  They are given the chance to improve their lives in several aspects.   Last term, while I was meeting with my groupmates in our project, our conversation went to the required minimum wage (481?).  I was working on the SWOT analysis and one my group mates (which is also the business owner) said that he considered the minimum wage as a threat to the company because it cuts down his revenue, (he does follow the law and give his workers minimum wage).  I was surprised though because when you think about it a day’s minimum wage can barely support a family so it was appalling for me to hear someone say that they want to pay a lower wage but then as the rest of the group pointed out I am not a business owner and I never had to worry about working capital and paying wages and they’re probably right).  I blurted out that these people have families to support too and they have to work hard labor under the sun for 8 hours something that we can’t even imagine to do.    To cut the long story short, I stood firm with my belief that giving a minimum wage is a just thing to do and my group mates told me that I can’t and shouldn’t be doing business (they probably think I’d end up bankrupt) to which I defiantly replied “I can and I will prove you wrong”.   Mrs. Sevilla validated my belief that not everyone build business for the sole purpose of making a profit.   That some people are okay with a slightly lower net income if it means that their employees are living above the poverty line.   I am just at awe at this wonderful woman who is a mixture of compassion and grit.

 

In this day and age when everything seemed to have a price and most businesses are focused on cutting costs (even if it means giving unfair wages) and increasing net income, it’s refreshing to come across people who genuinely care about their employees and work hard to contribute to the society while helping boost the economy.   During the open forum, I told her that her company and its story is very inspiring.  I shared with her that I used to wonder if there are companies out there that that actually practice IHD and she said that there are actually quite a lot of businesses that do but most of them are SME.  She further said that it is easier to do CSR when you are the owner and there are no investors/shareholders to please.

Her talk was very inspiring and listening to her is like reading a feel good book, it left me with a warm, fuzzy feeling but also instilled realistic scenarios and business strategies in me.  I hope that there would be more companies like The Leather Collection and that being fair in every aspect of their operations become the new norm.  May the entire organization of The Leather Collection live long and prosper.

 

 

 

MBA Elective: CEO Series

 

I was so excited to start a new academic term with my first subject: Trends and Issues in Business Management: CEO Series, which is an elective in my MBA program.  I chose this subject over the others because I am really interested to listen to top CEOs of the country as they share their valuable experiences and insights both on the corporate world and on personal and professional growth.  This is an opportunity I would gladly take advantage of.  It’s not every day that you get to talk to CEOs and ask them your very own questions.  I am so thrilled to meet all of them.

The first session was dedicated to the introduction of the course, followed by the ever present first day of school “introduce yourself” part.  To make it more interesting our professor, Ms. Pia Marasigan, asked us to partner with a classmate we’ve never met before and spend five minute getting to know each other.  We then introduce each other to the rest of the class.  I partnered with Felice or Fel for short and I had a wonderful time talking to her.  We then given the over view of the what would be the entire look like, the schedules and the line of speakers.  I can’t wait for the next session to come 🙂