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SOON after
World War II, from 1941 to 1945, the Philippines
experienced a decade of unprecedented growth in the 1950s,
with Manila—despite being the most devastated city during
the climactic battle era—slowly regaining its vigor to
once again become a center of industrial progress.
Multinationals started to bring in their businesses to the
country. Among these companies was General Electric
International Inc. (GE), a diversified technology, media
and financial services company, which picked Manila as the
hub of its operations in Southeast Asia at the time.
“In the
1950s,
Manila used to be the operations headquarter for
Southeast
Asia. That was a very telling sign then,” GE Philippines
Inc. president Colin Low told the BusinessMirror in an
interview.
GE has
since shifted its operational hub to Singapore, although
it has maintained its business presence in the
Philippines, where it has operated since 1890 when its
predecessor, the Thomson-Houston Electric Co., installed
the first electric street lights on Real Street in
Intramuros.
Low, whose
territorial responsibilities also include Singapore and
Cambodia, wishes for the Philippines to have that same
excitement it had in the 1950s.
“I see the
Philippines is so sizeable enough to be large on its own,
where GE is not just best known as the technology company
that provides customers quality products and services
ranging from aircraft engines, power generation, water
processing and security technology to medical imaging,
business and consumer financing, and media content; but
also giving employment opportunities to people here,” he
says.
“We stand
for delivering on this commitment. We stand for creating
value for our stakeholders, and most importantly, the
community where we operate in.”
Emerging
economy
ALTHOUGH
the country no longer hosts GE’s base in the region, this
does not mean its business in
Manila
is in a bad shape, Low insists.
He points
out that the company is growing in the Philippines at a
growth rate of 20 percent a year—a significant growth rate
considering that the $175 billion worth company has been
expanding worldwide roughly at an 8-percent pace.
“That
equates to a pretty intense kind of a growth,” Low
stresses.
Noting
that nearly 60 percent of GE’s global growth will come
from emerging markets in the next decade compared to 20
percent in the past 10 years, the US-based company is now
challenging its Southeast Asian business units to grow
“two to three times the GDP [gross domestic product]
growth rate” of the countries where it operates, expanding
to $6 billion at the end of 2010, or double the $3-billion
revenue it posted last year.
“If you
look at Southeast Asia as a region, GDP growth is roughly
about 5.5 percent—that’s certainly a faster growth than
the world’s at present,” notes Low, who is also the
regional executive for growth initiatives of GE in
Southeast Asia.
“To build
a strong presence in this area where most of the
developing economies come from, we leverage our global
success and experience in this significant market.
“And we
are proud to expand our strategic focus in Southeast Asia
by gaining a platform for growth in the
Philippines,”
he says.
Achieving
the target
BELIEVING
that GE’s wholly owned subsidiary in the country is
well-positioned for the global and regional challenge of
growth, GE Philippines under the leadership of Low is
doubly working hard on it.
“Fundamentally, we want to ensure that the Philippines is
part of the rate of growth at 20 percent in Southeast
Asia,” Low says.
“But the
point here is we have to find new platforms for growing.
So part of the reason why I was appointed to this role is
to develop GE’s Philippine strategies.”
These
strategies need not be confined to the prime drivers of
GE’s growth in the local scene at the present, which
include infrastructure (energy, oil and gas and water
process technologies), health care, aviation (aircraft
engines and aircraft leasing), and consumer finance with
the acquisition of Keppel Bank now known as GE Money Bank.
“I also
want to work on the ‘Three-Pronged Approach’ on my
priority list,” he says. These are: leveraging on
relationships with customers, tapping the mining sector
and developing people.
GE has
developed a new strategy dubbed, “A New Vertical,” wherein
the company leverages on the relationships it has long
established with its customers. In the
Philippines,
Low mentions GE’s business with Lucio Tan and John
Gokongwei.
“These
tycoons are driving the economy of the Philippines,”
explains Low. “So the first-pronged approach of my
leadership here is to really leverage on our good
relationships with them and, eventually, extend it to
alternate business areas they are also in.”
Prior to
his current appointment in the Philippines, Low was the
managing director and general manager for
Southeast Asia for GE Aviation-Aircraft Engines and “my first job was to
take care of the Philippine Airlines [PAL] account—the
oldest airline in the region owned by El Kapitan [Tan].”
“We have a
strong relationship that’s more than 40 years old with PAL
and we’re very proud of it because all over
Southeast Asia, it is a 100-percent GE customer,” he continues.
Proof of
this partnership is that the country’s flag carrier uses
GE equipment in every airplane it flies. Even on PAL’s new
fleet of Boeing 777-300ERs, the planes will be powered by
GE90-115B engines.
Apart from
delivering aircraft engines, GE also leases airplanes, not
only to PAL, but also to another key airline player: Cebu
Pacific owned by the Gokongweis.
“I was the
person who did the deal with John and James [Gokongweis]
on their Airbus,” Low boasts. “Just like PAL, we’re very
proud of Cebu Pacific—again 100-percent GE empowered.”
To further
strengthen GE’s partnerships with the two tycoons, Low is
also looking to extend it into their other businesses such
as real estate, mall operations and manufacturing.
“Not to be
ignored also are the other taipans in their ranks that are
on my list,” Low stresses, without naming the other
businessmen.
“We want
to grow with them because of the rapid pace of [their]
growth. They just don’t grow by 5 percent to 6 percent,
but tremendously by 20 percent, 30 percent to even 40
percent annually.
“That’s
how GE is going to make its commitment to the Philippines
and the region, as well as fulfilling that global mission
in terms of its commitment to Wall Street,” he says.
Asked how
he would realize these, he says: “My job is to bring in
the entire GE products, services and financing capability
into a package of solutions for strategic customers like
them.”
Tapping
the mining sector
ANOTHER
source of future growth for GE is mining. As projected by
the Department of Environment and Natural Resources, the
mining industry is seen as a booming sector that would
further spur the country’s economic growth in 2008 and in
the years to come.
“This
country has a tremendous amount of natural resources. So
we want to be involved in an industry that drives national
growth,” Low says.
GE’s
revenues from the mining sector currently amounts to
$200,000, a measly portion of the $3 billion worth of
investments generated by the Philippine government in the
last five years.
“I like
this country to be a showcase for GE in
Southeast Asia,
where mining investment is projected to double to $6
billion in the next three to five years,” Low says.
Mineral
deposits like copper and gold, which are abundant locally,
are experiencing a boost in prices worldwide. Given the
surging market value of such commodities, each mine can
generate $50 million to $200 million yearly.
“And I’m
looking only about 10 percent to 15 percent out of their
buying equipment from us in their needs for energy, water
and even security solutions,” Low says. “Similar to
leveraging our relationships with our customers, we are a
company that can provide these entire package solutions
for the mining sector.”
Developing
people
WHILE GE
has developed specific strategies for every country where
it operates, executing them properly is definitely not
possible without good people.
“The
people are the most important asset to us at GE,” Low
says. “Otherwise, we don’t get to be rated [as the first
overall] on Fortune magazine’s 2005 Global Most Admired
Companies list.”
Amid being
a gigantic global company it is, GE sees to it that its
people are always connected at a local level, enjoying
good relationships with the customers that drive their
business.
Also, it
continues to build a winning team capable of bringing in
cultural compliance, operating performance with integrity,
and passion to take care of the customers’ concerns and
well-being.
To do
this, Low says, “We train and, most importantly, develop
them as individuals. We mold them to run not just the
Philippine business, but also that of the region. And
eventually, we prepare them to manage the business on a
global scale.”
“With
them, we see what we do, execute it and, then find out
what is better on the next round. That’s what makes us
different from other companies.” |
