Philippine world beaters

One would be hard-pressed to look for anything positive in the recent Word Competitiveness Survey that ranked the Philippines 77th among 130 countries. That ranking was based on the aggregate of scores for 12 pillars of competitiveness: public and private institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market sophistication, technological readiness, market size, business sophistication, and innovation. Of these, the country only scored well in the size of its domestic market — no doubt due to our high birth rate which as it turns out can have an upside too. But other than this God-given gift, the only other pillar we did relatively well was in business sophistication.

If one were to look for a silver lining, this might be it. On this measure of competitiveness we were ranked 55th placing us in the upper half of the 133 countries surveyed.  This looks at, among other things, the quality of a firm’s operations and strategies. In the real world, recognition of such quality is manifested in the success of that firm in its home market but more particularly in overseas markets where it faces fierce competition from other foreign companies.

One such firm is International Container Terminal Services Inc. (ICTSI) headed by businessman Enrique Razon. ICTSI made its start operating the Manila International Container Terminal — adjudged one of the best operated container port in the region — and now operates ports in Brazil, Poland, Madagascar, Japan, Indonesia, Syria, China and Ecuador. By next year, the company would be operating ports in Spain and Georgia (in  the former Soviet Union). It can be rightly said that ICTSI has reached the status of a multinational corporation based in the Philippines and is doing so with flying colors.

ICTSI has been named by Forbes Asia magazine as among Asia Pacific’s top 200 companies in its 2007 “Best Under a Billion” list, and is the only Philippine company to be included in the list.  The company was included in Forbes’ Best Small Companies in 1997 and 1998, and the magazine’s “Best Under a Billion” list in 2003. In previous years, the company was cited for excellence in corporate governance and stakeholder relations by various publications and organizations.

The honor of becoming the country’s first multinational however goes to San Miguel Corp. Established in 1890, La Fabrica de Cerveza de San Miguel, Southeast Asia’s first brewery produced and bottled what would eventually become one of the bestselling beers in the region. In 1913, they started exporting beer to Hong Kong. It was in  1948 when Don Andres Soriano purchased a  brewery/distillery  in Hong Kong. Under the Sorianos, San Miguel Beer was to become among the top 20 beer brands in the world and SMC develop into a diversified food and beverage company expanding into China and Vietnam. Although its recent expansion binge has received mixed reviews from corporate analysts, San Miguel continues to be the doyen of Philippine corporations who have ventured overseas.

Another company making waves in Asia is Liwayway Marketing Corp. (LMC) maker of the famous snack food “Oishi”. LMC began as a small family business engaged in the repacking of flour and coffee products which has blossomed into a regional powerhouse in snack foods. Spearheading the company’s aggressive move overseas was chairman Carlos Chan, who in 1993 launched the company’s first venture in China which has now grown to more than 12 companies located all over the mainland. LMC’s products in China are marketed under the brand “Oishi Shanghaojia,” which in 2001, received the Shanghai Famous Brands award, firmly establishing itself as a major brand in Shanghai, and the rest of China as well. LMC now has manufacturing facilities in Ho Chi Minh City, Vietnam (1997) and in Yangon, Myanmar (1999), where Oishi is now the leading snack food brand. Oishi is also becoming an established brand in competitive markets like Hong Kong, Taiwan and Japan.

One cannot talk about Philippine companies who are world beaters without mentioning Jollibee, one of the Philippines’ phenomenal business success stories. From its humble beginning as a two-branch ice cream parlor in 1975, Jollibee Foods Corp. is now the country’s leading fast food chain with almost 600 stores in the Philippines and 27 international stores in countries like the United States and Hong Kong. Its recipe for success is its uncanny ability to gauge what would appeal to its market as reflected in its menu lineup, service and marketing pitch. Behind this is superior management overseeing a no-nonsense manufacturing and logistics facilities. Tony Tan Caktiong, its CEO was awarded 2004 World Entrepreneur of the Year by the international consulting firm Ernst & Young.

There are other examples of Filipino companies — large and small — that are making their mark here and abroad. The common ingredient seems to be a visionary and fearless leadership willing to take on the competition in its home market and abroad. So despair not dear readers. Yes there are a number of competitiveness issues we should be urgently addressing but as a few good men have shown us, these should not stand in the way of determined leaders. Despite what the rankings say, evidence on the ground suggests that we can nurture world beaters. You can imagine what it would be like if we finally get our house in order.