c F n l F r r F F n a c r o B F n r o o S

Oriental TAO & Occidental LogosThe Meeting of Management Minds

MANAGEMENTAND THETAOManagement and the Tao is a retum to basics, to those

foundational assumptions underllng how to managementprescriptions. The practical value of the book for managersand leaders, especially in developing countries in transitioninto modernity, lies in recognizing that the same power of

community that gives an organization continuity andstabilitv is also the foundation for a

ffiwglobal communi ty :shared meanings andshared values that con-nect with its roots andpreserue its self-identiry.The title "does not sug-

gest replacing a dubiousWesternizadon with a du'bious Orientalization. . . For

we believe that the OrientalTao and the Occidental Logos

can and do meet. But the meeting re-qui res management . I he Occidenla l interest in Oriental thought must move beyond the exclusive and often conde-scendingsearch for the intuitive, the esoteric, and the parapsychic, as if all it hadto offer was beyond, or beneati, or against, what was rational.The Oriental interest, in turn, must move beyond the appar-ent fixation of Occidental rationality on a philosophy ofsuccess...lt is to contribute to this encounter that we want t0uncover the philosophical premises of lhe Oriental Occidentaldichotomy that underpins preshift management thinking."*

* Taken lrom the Pfeface of Managemenl and the Tao

PrcJ. Leonarda R. Silos is a faculty member of the AsianInstitute of Management lAlMl, Makati, Philippines.

Management and the TAO is published by IMC Prcss lnc.8.,.,,.",,

YES. Pleas€seid me copy,'coples of Prof. L€onardoI Si lo l book, [ tANACE,UINTAND THL IAO ISBNcTll2 0219 0l (a lJSS l0 p€r copy

. Pr.Aead.lJss5 t0 f.fhandlirsar. i.rfi.r d.lv.n 0!6:d. [1etl]

i enclose my.hequ€ for USS nade payable roAsjan Instrtute of Management ch€.ks in Philipplne pesos

Please charge m! Credi t ( lard No.

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SAIM,r, or,* n))o;;" ,;,,,,;., bimonrh,vby the Asian Inst i tute of Management. MITA (P)196/10 /95 KDN pp(S) 1076/3 /97 rSSN 01 16-77901 Editorial and Advertising Office: Asian ln-st i tute of Management, 123 Paseo de Roxas,Makati City, Philippines. Tet: 1632) 892 40t1.25 ; 892 0435"43;8933341 Fax : (6321 8179240.Internet Address: tam@aim.edu.phSelections from past and current issues foundin http:,//www.aim.edu.phCopyrightO 1998 The Asian Manager. All rightsreserved. Reproduction in any manner in wholeor in part in English or other languages withoutprior v/ritten permission prohibited. Printed byTimes Printers Pte. Ltd., Singapore.

Eonorur Bomo:Chairman: Jesus G. Gallegos Jr.Members: Rene T. Domingo, Victor S. Limlingan,

Patricia L. Lontoc, Eduardo A. Moratd.Ashok K. Nath

Eonorulr Drplnrurrur:Editor-in-Chief: Patricia L. LontocEditorial Director: Gertie Ampil TironaManaging Editor: Jocelyn de JesusFeatures Editor: Peaches S. CastilloArt Editor: Manny L. EspinolaConhibutingArtist Sahsah M. Villalba

BusrNess DepARfl\4pNr:Publisher: Felipe B. AlfonsoCo-publisher: Patricia L. LontocOperation3 Director: Millie C. FenerMarketing Manager: Edythe L. BautistaAdvertising Of;ficer: Vanessa M. JaballasCirculation Officer: Eden S. Cardeflas

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Cros s cultural InsensitivityCan C-O-S-T You

hen cultural denial can be as dev-astating to communities as AIDSis to individuals as MarinaMahathir discovers in this issues'

cover story what price cultural pride? Andwhat cultures are we talking about - g1o.bal, national, communal, corporate, fiater-nal or fillal? Only the culture-shocked canbe particularly sensitive - even paranoid- about playing and parrying culturesprior to level ing playing f ie lds. Or eJse, asthe articies suggest, it can c-o-s-t the man-ager, the shareholder, the stakeholder.

C for customer corrosion

Consider the customer. If you don'tpay attention to hls,/her cultural context ,he,'she wiil probably frer ar first, but even-tually fiitter away from your business. Like-wise the employees when you overlookthem as your customers as well: a poten-tially corrosive constituency. Customet col-rosion translates to loss of revenues andrelationships. Check out Gldria Chan's"Breaking the Cultural Ice" for crosscui-tural negotiatron tips. Unmask capitalism'squrrks in Nards.SiloCs "Mark of Soros"for new ways of motivation. And in columnist Digoy Fernande/s"Attack of theGlobal Speculators," vic4riously slug it outagainst financial traders-the "AIDS of theworld economy."

O for obsolete organization

On the other hand, if you evade cor-porate culture and impose formal struc-tures, you'll find the charts and chains ofc o m m a n d i g n o r e d a l o n g w i t h t e a m -building efforts. Investments in organiza-tional development will have to begin withinvestments in developing trust, conf i-dence and commitment. So advisedPopoy Juico in "Public Profit, PrivateService"" So gauged Ned Roberto in"Developing the Philippine Business Con-f idence Index."

S for succession stress

More so if you let familial ties slide inattempting to introduce culture change inthe workplace. The enterprise can bestressed and distressed by transitions thatcompromise signlficant savlngs fiom op-erations. Millie Ferrer captures succes-sion strategies from family corporation re-search of Marion Hamptonand TitongGavino. As for women-1ed enterprises,Vicky Licuanan shares how the"womanager" breaks through the $assceiling.

T for talent turnover

In the knowledge age, genius knowsneither company nor country and youstand to lose institutional memory as wellas R & D if talent is mismanaged. Excel-lent managers are known by the cultureof excellence they keep wherever theymay be. Keep in touch and turn the turno-ver into opportunify: your company is alsoas vast as your rolodex of ex-employeesthat have become your ethical community.Such is the search for transformationalleadership that Najib Tun Razak andAbe SyCip embark on and what TunIsmaits legacy of integrity inspires.

The problems caused by customercorrosion, organizational obsolescence,succession stress and talent turnover areclosely linked and reflect on the corporatebottomline. Just imagine if a company hada strategy for even just one of these. As itimpacts dn the others, crosscuitural man-agers will not leave you cross, but will callfor bottoms up!

f-tr{*}Associate Dean Lontoc tenches priaatization, nnd

economics in MBM anri CDM.E ma il : p lont oc@aim.edu. ph

SeptemberOctober 1998 | 'fhe

Asian Manaser 3

T"r{H,ASIAI{NAAhIAGXR

VOL. XI, NO. 5September-October 1998 Issue

COVER STORIES

Asia in Denial >

By Marina MahathirA wake'up call for Asia

as i t deals n ' i th the20'r'-century plague' calledAIDS-and counse'l from

the chairn'oman of the

Malaysian AIDS Foundation

In Search of Transformational LeadershipBy Sri Nalib Tun Razak, Ministry of Education, MalaysiaThe Malaysian Education Minister sourlds the call for

a nen'breed of Asiari managers

Developing the Philippine BusinessConfidence IndexBv Eduardo L. Roberto, AIMThe thoroueh business index can be the mosticleal guide for busitressmen

COVER STORY SIDELIGHT

Passing the (AIDS) TestBv Emmanuel Espinola Jr., AIMWhy having an AIDS test can be the creepiest experienceof a'lifetimd

FEATURES

The Mark of SorosBy Leonardo R. Sllos, AIMHow an audacious financialspccrr lator compel led Asia toask i t re l l the m6st basrc eth icalquestions

Public Profit, Private ServiceBy Phtlip Ella Juico, AIMBuilding constituencies' trust is thefrom pullic to private

Iinchpin in the shift

TRIBUTE

Memories of Tun Ismail >AIM professors recall theprofessional life of AIM CovernorTun Ismail; a special tribute ttrt he Man r r f l n t e t r i t y , t \ r eP r i n tedfrtsm S un tlty Sty[' (Malaysia);

and the life' and tirr-res of Tun Ismail

according to his son Iskandar and

AIM Govetnor Tan Sri Dr. Lin See Yan

THE ASIA PACIFIC

Women Mean BusinessBy Victoria Licuanan, AIMWomen are changing dvnamics in the workforce,

and organizations must make the necessary adjustments

CONFERENCENOTES

Family Get-togetherBy MiLa Lea C. FerrerA Management Forum discussion

sheds light on family corPOratronshere and,abroad

AIM GLOBAL

Attack of the GlobalSpeculatorsBy lose Ma. Fernandez, MBM '73

World economies are on the lookout

for currency speculators in a bid to"control" the unpleasant side effects

of globalization

AIMLINK

272 l

l 9

l 343

2447

45

1 1

Breaking the Cultural IceBy Cloria Chan, AIMCrosscultural negotiation requires cultural 5nv1'y-and spur.rk

What Makes a Good Leader?By Abe SyCip, MBM 'qSFind out why some leaders can lead ancl whv othersmust simplv follow

35

To influence managementthought ancl practice in Asia

The Aslan Manager I September-October 1998

49

from the Mlssion Statement of Ttts Aste,v Mewacrn

Dr. Gloria S. Chan gloria(@dataserve.aim.edu.ph

Dr (] lor ia S. Chan, AIM's Mobil Oil Professor of Humanir ies. was alsothe Director of AIM's Masrer tn Business Management {MBM) program from1595 1997 . She specializes in Management (lommunication for the Asian Man-ager, ctoss-cultural management,/communication, and management innovations.In 1 989, she founded the AIM Language Center that pioneered the use of casemethod in the teaching and learning of English as a foreign language.

Emmanuel L. EspinolaJr. eespinol@ldataserve.aim.edu.phManny Espinola is The Asian Manager's lay-out artist and occasional con-

tributor. He is the Art Director of The Museum Shop and runs a silkscreen repro-ductron v/orkshop. He taught English as a Second Language at the Bataan Refu-gee Processing Center in the late 'BOs and was the resident movie critic ol TheManila Chronicle from 1989 to 1991. He researched and wrote for pC Digestin the same period, and was once Associate Editor for the pop culture magazineIingle. He was first gainfully employed as an English Instructor in I 983 at thelJniversity of the Philippines, where he finished his AB in Phirosopny.

Mila Lea C. Ferrer millie@rdataserve.aim.edu.ohMila Lea Ferrer is the Director for Operations of the publicatjons Department

of AIM's International Relations Group. She also served as publications Supervisorof the Corporate Public Communicatjons of AIM from 1992.1994. She recentlycompieted AIM'"S Basic Management Progam {BMP). She is cunentiy Board Secretaryof the Triumphant Christian School in Cavite Ciry philippines, where she also served asEditor-in Chief of Triumphant Chrisrian Ministry s /os eph The FruitJul Vine.Feterholds a bachelor's degree in Public Relations foom St. paui s College in the phillppines.

Jose Ma. Fernandez

number of donor funded research projects in AIM, among them the CIDAJundedASEAN study on Women Managers in Organization, Women in Development,and Cender Analysis. She is currently Economics Consultant to the Womenin Business project of the United Nations Development program {UNDp)and the Confederation of Women Business Councils in ApEC (CWBC APEC).Licuanan is the author and editor of three books: Women Entrepreneursin Southeast Asia, Breaking Barriers: Businesswomen of Southeast Asia,and Beyond Profit: ASEAN Women Managers in Government and Not-for.profitOrpanizations.

Marina Mahathir http:/,/www. asiaconnect.com.mvA journalist and publisher, Marina Mahathir is also a welfknown columnist

lThe Statland author. But she is perhaps most famous in and out of Malaysia asthe leading AlDS-awareness activist, being the chairwoman of the MalaysianAids Council, an umbrella organization for the nation's various AIDS groups.She is also the eldest daughter of Malaysian Prime Minister Mahathir Mohamad.

Tan Sri Dato Mohd. Najib Tun RazakMohd.Najib Tun Razak is the Malaysian Minister of Education. Before this,

he was Minister of Defense and Chief Minister of Pahang. He has been withthe government sector for more than twenty yearc, being vice,president ofLIMNO, Malaysia's ruling party since its independence. He is also the founderand chairman of the Malaysian Strategic Research Centre, a private think tankwith the objective of enhancing knowledge in the areas of politics, economicsand sociery He is the anlhor of Asta-Pacific Stategic Outlook The Shifring ofParadigms and Leadership Models of Asia in the 2I st Century.

sac@)mnl.sequel.net Dr. Eduardo L. RobertoJose Ma. Fernandez is concurrent President and Managing Director of Stan

dard Asia Properties, Inc. and IMC Ventures Inc. He is also the Chairman ofAlumni Association of the Asian Institute of Management and the Federation ofAIM Alumni Association Inc. (FAIM). He has served in government in variouscapacities, including Officer In Charge and Director of philippine Tourism Au.thority, the Coordinating (louncil of the Philippjne Assitance program and Adviser to the Chairman of the Philippine Gaming Corporation. Fernandez is morevisible to the public as a columnist for the Philippine Star, Business World, Busi-ness Daily and Business Day. He wc.tn the Ouill Award jn 1aBO for Most Out-standing Editorial Writer and the Jaycees lnternatjonal prize for Most Outstanding Chapter President of the World in l9B 1.

Prof. Philip EllaJuico philipGridataselve.aiq.erlUpbProfessor Philip Ella Juico, AIIr4 Corazon Ci. Aqulno professor for Develop

ment Management, is Ohairman of the Philippine Sports Commission and presidential Consultant of Community Development. professor Juico has served inKey government posts as Assistant Minister of the Ministrv of Agriculture andFood, Undersecretary of the Department of Envjronment and Natural Resources.and Secretary of Agrarian Reform. He ls concurrently Ditectof of the Land Bankof the Philippines, National Economics and Development Authority, Development Academy of the Philippines, and (labinet Officer for Regional Develop-ment fof the Cordillera Adminisrrative Region. In 1987, prof. Juico received theAIM Alumni Association (Triple Al Award and the Ten Outstanding young MenAward in the field of government service.

Dr. Victoria S. Licuanan vickieGrldataserve.aim.edu.phProfessor Victoria S. l-icuanan, AIM Citibank Professor of Business Manage

ment, specia l izes in monetary economics, internat ional f inance, leadership andteambui ld ing, women managers, and smal l and medium businesses. She wasAIM's Associate Dean for Enterprise and Pfoiect research and has directed a

ned@dataserve.aim.edu.phDr. Eduardo Roberto is AIM's Coca Cola Foundation professor of Interna-

tional Marketing. Dr. Roberto was a hustee of the Philippine Advertising Foun-dation, director of the Philippine Board of Advertising, member of the editorialboard member of InternationalJournal of Research in Marketing, president ofthe Marketing and Opinion Research Society of the Philippines, and president

and Chairman of the marketing research and consulting agency Roberto & Asso-ciates, Inc. A recipient of the Philippine Marketing Association AGOM Awardfor Achievement in Marketing Education in 1983, Dr. Roberto has written fourbooks: two on marketing and two on social mafketing, one of which was co-authored with Philip Kotler.

Prof. Leonardo R. Silos Leosil@rdataserve. aim. edu.ohProfessor Leonardo R. Silos, AIM's Philippine Long Distance Telephone

Co.(PLDT) Professor of Business Management, is with the core faculty of AIM,sCenter for Development Management where he specializes in organizationaland human resource management and development. Before AIM, he held executive positions in various companies. He has also served as a consultant to theAsian Development Bank (ADB). Professor Silos has published two books onorganizations: OIKOS: The Two Faces.of Organization, and Management andthe Tao. Prol. Silos holds degrees in education, business administration, andohilosoohv.

Abe SyCip asycio@dataserve.aim.edu.phAbraham Joseph L. SyCip, MBM '99 candidate, was an experienced analyst forAndersen Consulting, handling projects with companies like the Dial Corpora-tion the Capital Group. He received his BA Psychology degree in I 995 fiom theCalifornia State Polytechnic University, Pomana. Mr. SyCip has been involvedand has led civic groups-activities, among which are the Circle (College Kiwanis)Service Club, and the Asian Pacific Heritage Week. He was also the ViceChairmanof AIM's Students Association in 1997.

September-October 1998 | TheAsianManaser 5

The

When the profit motive collides with the human side of capitalism

I n Asia, George Soros is a name in- anti-Semitism. It was four years later whenr , , . , . , . ,I delibly linked with the financial tur- an ASEAN leader put a name to that specu-

I moil of this last decade of the sec- lator that I came to know of George Soros.I ond mil lennium. Soros. unl ike And i t was only a few weeks ago that I

many superficial observers, would not learned fiom a colleague that Soros hadpoint the finger at Oriental corruption or written a book called The Alchemy ofAsian style clony capitalism to explain the Finance and also that I could downloadcurrent economic problems in Asia. Soros's his two articles in the Atlantic Monthlyculprit is the intrinsic instability of capltal- from the Net, which I did.ism itself, especially lts financial markets.That is to say, if we take Soros at his word, Real Dealit is the system itself that is corrupt. After Here was Soros warning against capi-ai1, the financial turbulence of the '90s talism as a threat to society. He decried,began in Europe and, incidentally, there ln his words, the spread of market valuestoo we find the mark of Soros. The regu- into all areas of life, endangering our openlar booms and busts of the capitalist sys- and democratic society. He warned againsttem are well documented and, believe it the reliance on the maglc of the marketor not, Soros finds their root cause in some- mechanism, against the belief that thethlng quite philosophical, epistemological untrammeled pursuit of self-interest leadsto be exact, in the distinction between the to the optimum allocatlon of resources.natural and the social sciences. The prob- Laissez-faire capitalism rests on a false anal-lem lies in trying to apply the methods and ogy, that the market is, like the physicalcriteria in the study and control of natural universe, a self-regulating system, that freeevents to the study and management of markets are self-sustaining and excessessocial events. correct themselves, provided that govern'

The first time I became aware of Soros ments do not interfere with the selfwas in 1993, when I was in Germany on correct ing mechanism.an exchange program and a Professor there The physical universe is not influencedwas badmouthing a certain speculator in by what we believe but the social universeNew York of Jewish lineage who was be- is. Gravity works the way it does, whetherlieved to be behind the speculative attacks we believe in it or not. But present prices,on the European curencies. At the time, for instance, depend on our beliefs andI brushed it off as a malingering case of perceptions of future price movements.

6 The Asian Manager I September-October 1998

Markor

WffiWffiffiWe say that present prices discount futurerevenues. Soros cal1s this the reflexivity ofthe market.

Because market events include and areinfluenced by the beliefs and perceptionsof the players, our understanding of themarket ls imperfect. For these perceptionsand these beliefs and these sentiments arenot directly accessible to observation, likerain, but only indirectly. Market events,like ail social events, include a mental com-ponent which is opaque to direct analysisbut which nevertheless influences themarket. Soros ca11s this the imperfectunderstanding of social reality.

Let me illustrate the significance of thismental component through a simpleexample.

I see a rock fall off a c1iff. Where therock had been, I notice that the earth hadgiven way and I observe that it had iustrained. I may have sufficient data to ex-plain the rock's fall. Now suppose I see aperson fa11 off a cliff and suppose I findexactly the same data, rain and soft earth,have I sufflciently explained the fall?Not necessarily. It may have been anaccident, but it also could have been asuicide. What element am I adding herethat I did not seek in case of the rock? Iam adding a mental component as anintrinsic part of the event. The state ofmind which does not enter into the

explanation of the falling rock enters aspart of the meaning of a person's fall.

Let us take another example, this timemore closely related to the market. NathanRothschild was, like Soros today, a finan-cial guru of London. On June 19, 1815,London was tensely awaiting the outcomeat Waterloo, for if Napoleon won, the ex-pectations were that the London bond mar-ket wouid drop sharply, but if Wellingtonand the alliance won, the market wouldrise. Now Rothschild received the newsof Wellington's victory through his owncouriers many hours ahead even ofWellington's own envoy. Rothschild thenwent to the exchange but, instead of buy-ing into the market as ordinary mortalsmight have done, he started to sell heavilyand dump consols, as the bonds were thencalled. Whispers were heard, Rothschildknows, Waterloo is lost, and the crowdstarted to sell following the example oftheir guru. Just before the news of the vic-tory broke out, Rothschild was alreadyheavily buying back. Rothschild success-fully manipulated expectations and engi-neered the panic selling. Many lost theirshirts, Rothschild acquired more.

But suppose further that the panic sell-

ing caused the market in general to col-lapse. Normally prices reflect fundamen-tals but in this case, the depressed marketerodes the fundamentals, eroding theprices even more. Once confidence - avery mental component of the market -has been eroded, investors shy away,depositors pull their money out of thebank, orders dwindle, inventories pileup, and the economy is in a tailspin. Thestory sounds very familiar indeed. Butthat seems to be the point of Soros. Pricesdo not tend to an equilibrium but rathertoward excesses, upward in booms,downward in busts. This proneness tobooms and busts, Soros says, is intrinsicto the capitalist system. He thereforeargues that the markets, especially thefinancial markets, to be less volatile andless subject to the manlpulation of the likesof himself , need more internat lonalcontrol, something perhaps like an inter-national central bank. The most famouspredator of the financial markets is askingto be controlled.

Greater RegulationSoros represents the very capitalist

threat he ls warning against. It is difficultfor Soros to evade thecharge of hypocrisy by hiscritics. For even as hewarns against the capital-ist threat, he not only con-tinues to be the consum-mate capitalist but as aconsultant continues toadvise others how tomake money out of theunstable markets, perhapsUiggering the collapse ofthe market. Apparently,for as long as the capital-ist system allows them,the foreign currency mar-ket is fair game for thespeculators. And specula-tion, Soros says, can aiter"fundamentals" and de-stabilize economies. Andso he suggests not less butmore regulation of the in-ternational financial sys-tem to control excessesand preempt the destabilizing power of the specu-lator of the likes of Soroshimseif.

Even as Soros warns

against the capitalist

threat, he not only

continues to be theconsummate capitalist

but as a financial

consultant continues

to advise others how

to make money out of

the unstable markets,perhaps triggering

the collapse of the

market

But if it is difficult for Soros to escapethe charge of hypocrisy, it is also difficultfor capitalist economists to argue againstSoros. He could ask his crilics: I saw thecrisis coming and became dch(er), didyou? Apparently not even the IMF or theWorld Bank saw it coming, not even thebig capitalist players, like GM which in-vested big in Bangkok just months beforethe economic meltdown there. And to thehindsight economists who claim theycould read the coming crisis in the eco-nomic figures, Soros would simply ask:Well, were you sufficiently convinced byyour analysis to put your money whereyour mouth is? Did you perhaps start buy-ing dollars when the buying was good?

Now, what has all this got to do withthe management of human resources? Ihave chosen Soros as a link to my topic,first of all because he represents a prob-lem uppermost in our minds these days ofeconomic instability, but also becauseSoros brings up a point that is very rel-evant not only to the financial crisis but tothe management of people in general.How sound his interpretation of capitaiisteconomic's is, I leave it to the economiststo ooss swords with Soros. What is rel-evant to us is the distinction between thenatural and the social sciences on whichSoros bases his own thinking about themarkets.

This distinction is not original to Sorosbut is at least a hundred years old, a reac-tion against the attempt to apply the sci-entific method of physics to the study of

93

6oo

u?

ao

o

Soros strikes a pose: Making the most of the worst

September-October 1998 | The Asian Manager 7

That a hands-on

capitalist and

speculator like Soros

has come to take

seriously into

account the mental

component of social

reality might be

taken as another

sign of a paradigm

shift in the study and

management of

social reality

the social sciences. It is therefore not aquestion whether management should bescientific. But in what sense scientific? Forthe method of the natural sciences (physics, chemistry, biology) applied to the so-cial sciences (politics, economics, psychology) systematically omits the most cdticalcomponent of a human event, its mentalcomponent. This systematic omission, forinstance, takes place in the capitalist eco-nomics which Soros criticizes. The systemis considered to be self-regulating, inde-pendent of the whim oI wisdom of people.The common good is achieved by individuals attending to their own self-inter-est. The prime mover of this seilcorrect-ing system is therefore not somethingmental but reduced to something biological, self-interest as instinct, not as some-thing distinctively human but as somethingcommon to all animals, an objective, uni-versal, determined as well as determiningprinciple that can therefore be studied andmanaged by the method of the naturalsciences.

established and the crucial relevance ofthemind is more and more recognized in hu-man events, then we may expect thathuman resource management will be approached less and less with methods andcriteria used in the study and managementof natural events and more and more withmethods and criteria that are appropdateto human events.

Restoring ConfidenceHuman resource management will then

be iess and less dependent on formal au-thority of elitist experts and the coercivepower of social engineers. Declsions w111be less and less uniiateral, less and lessdependent on legislative fiat. Motivationwi11be less and less dependent on the car-rot and stick, and more and more com-municative, more and more dialogic, moreand more participative. If that is nothingnew to us, it is because the shift is in factalready takingpiace in management theoryand practice. And Soros, as we said, is butanother example, ambivalent as it mightbe, of that shift. We take the shift alreadytaking place as a signpost to the future di-rection of human resource management.

Making lay offs easier by legislative fiathas brought the unlons to the streets inKorea. In the end, it could not be doneunilaterally. The leglslators had to talk withthe unions. And that is the point. Therewill be more talking to each other, per-

haps more spontaneously then and lessgrudgingly than now, in good t imesand in bad times. There will be more talk-ing between management and labor, between manufacturets and suppliers, se11-ers and customers, creditors and debtors,toward more creative resolution of prob-lems, during normal times and in timesof crisis. In times of financial crisis likeours, there will be less recourse to themax im "Le t the ch ips fa l l where theymay," which tends to aggravate rather thanremedy a panic situation. Some economiststoday are arguing rather heatedly that thisis exactly what happened in the flrstmonths of the Thai financial debacle.For the maxim used in an economic cr i -sis rests on the belief that the system wouldnaturally and automatically correct itselfby itself, thereby disregarding the impor-tant mental component of the financialsystem we call confidence, not only offoreign creditors but also of the deposi-tors and the public in general. Withoutthis confidence no financial system is vi-able.

If lndeed we do not want to deal witheach other by force or by fiaud, if we wantto pursue the common interest ratherthan of a segment only, then we must talkwith each other about what is on ourmind. For it is the most appropriate wayamong humans, in good times and inhard times. T

That a hands-on capitalist and specula-tor like Soros has come to take seriouslyinto account the mental component ofsocial reality, admitting the inadequacy ofthe system that has been the maior sourceof his wealth, might be taken as anothersign of a paradigm shift in the study andmanagement of social reality. That is theconnection to our topic on human re-source management.

As the distinction between natural andsocial sciences becomes more and more

8 The Asian Manager lSeptemberOctober 1998

Instant communication is making the

common good'more and more common in

the emergent global village. Atomistic self'

interest is becoming more and more obso-

lete, perhaps especially in the economic

sphere, not because it has ceased to fire pas-

sions but because paradoxically the space it

operates in is becoming smaller and smaller.

The modern ftnancial pirates may soon find

out that the wealth they are plundering in the name of market

forces is their own. The pfioverbial rat of the sinking ship has

nowhere to iump out to.

konailok9J/ir4 "ManagenalandtheTao:)rynintionuConmunity' (ManilalMChva,l99S), p' 84'

'NAIIAOEIIIElITAIID IHI 'AO0rgonirdlm u Nonnrrify

Leonardo R. Silos

thry

Breaking the

ffiwffiwwetu $ffiffiSocial etiquette is not the cultural valuesystem-as any crosscultural negotiatormust know

e aii can agree that there is an ex-cellent future for cosscultural ne-gotiation because of the followingreasons: (1) we live in a shrlnking

world that requires us to dealwith peoplebeyond our cul tural boundaries: and 12)the globalization phenomenon, which pro-vided the stimulus for g1obal interactionabout a decade ago, will continue. Theeconomic crisis we face today provides aneven moie cogent reason for us to lookfor new markets, new products and newpartners.

Cultural IcebergWhen oeonle sneak of crosscultural

negotiation, what comes foremost to theirminds? They think of the superficial con-sideratlons-using the proper words ofgreeting, showing appreciation of exoticfood either by making audible sounds orexpressing admiration, learning to drinklots of sake or rice wine, or whiskey orbrandy, remembering spat ial consider-ations when interacting with the oppositesex, using appropriate gestures and bodylanguage. The list of cultural do's anddon'ts is endless and pervasive in the cur-rent literature of the business world. Asuruey of this literature indicates volumi-nous material on negotiating with the Japa

clally in the consumer electronics business,and the Chinese, because of their over-a-billion potential market for every conceiv-able consumer product.

You can be a top-rate negotiator yetpowerless in a crosscultural negotiation ifyou are not familiar with the cultural spe-cifics of the country of your negotiatingpartners. And being well-fersed in thecultural specifics does not mean merelyknowing the superficial manifestations ofculture. This notion is best illustrated inthe iceberg, a metaphor commonly usedin the social sciences to depict what isevident and not evident in human behav-ior. Social etiquette is what you see 0nthe surface, or the so-called tip of the ice-berg, and does not constitute everythingthere is to know about a cul ture's values,its patterns of communication and think-ing. For those of us who have been trainedin the Western style, we are at times sur-prised that there are varying patterns ofthinking among our Asian neighbors.

A true appreciation of another's culturestarts wlth the understanding, and thelearning of the values, patterns of think-ing and patterns of communication thaty0u see constirute the rest of the iceberg;the next step is for us to accept that thesecultural elements are different from our

Chan: Know thy culture

n e s e a n d t h e C h i n p s p ' t h eteason for this is apparent:the Japanese because of theireconomic dominance espe-

very own. As for patterns of thinking, myexperience teaching a diverse group ofAsian students at AIM for many years tellsme that the Chinese thinks differently fromthe Indonesian, the Malayslan and theThai; the Filipino, on the other hand, istrained to think in the Western tradition^ ^ i L ^ - ^ ^ L ^ ^ ^ l i F t p r p n t n 2 t l p r n n fq l l u r r s i l L g , l l d ) d u l l l _ .

thinking than his Asian counterparts. Thevarious patterns of thinking among thenon Filipino Asians is reflected in theirnat ive language and in their unique useof English.

Negotiating FrameworkIn focusing on the cultural elements of

values, patterns of communication andpatterns of thinking, I want to stress thatthe crosscultural negotiator must not stopat the superficial cultural manifestationsof his counterpart but musr go beyondthese to succeed. It is not an easy task forthe crosscultural negotiator to learn aboutthese underlying cultural elements but inrecent years, cultural fiameworks to ex-pedite and facilitate understanding andlearning have appeared. And one suchframework has been suggested by rhescholar-reseacher Geert Hofstede. It is aframework useful in reiation to crosscul-turalnegotiation and has implications forbehavior at the negotiating tab1e.

Hofstede's fiamework was based on theevidence gathered from 116,000 IBMemployees in 40 countries all over theworld. Hofstede's intent was to determinethe impact of culture differences on man-agement sfyle. From the data, Hofstedeidentified four value dimensions that ditferent iate one country from another.

September-October 1998 | The Asian Manager I

Negotiators from

collectivist

countries are

likelier to

develop and

sustain long-term

relationships than

those from

individualistic

countries

These value dimensions are: power dis'tanc e, individualism / c o lle c tivis m, masculinity /femininity, and unc e rtainty avo id'ance.

Power Distance dimension describes"the extent to which the less powerfulmembers of organizations and institutlons

[ike the family] accept and expect thatpower is distributed unequally" IHofstede,1989, p.195). This means that cultureswith large power distance are likely tohave decision-making concentrated at thetop and all important decisions are final-ized by the leader. In large power distancecuitures, inequalities among people areboth expected and desired; less powerfulpeopie are dependent on the more power-fu1, centralization is popular, subordinatesexpect to'be told what to do, privilegesand status symbols are expected and popu-lar. Implication for crosscultural negotia-tion? Negotiators fiom large power dis-tance cultures may need to seek approvalfrom their heads more fiequently thanthose from sma1l power distance cultures.This further means a slower negotiationprocess. If you are therefore negotiatingwith someone from Malaysia, Guatemala,Phillppines, Panama or India, expect aslower negot iat ion process. Germany,Great Britain, Norway, and Sweden arecountries with low power distance so ne-gotiations are expected to proceed faster.

I ndlvtdu alism / C o lte c tivis m de -

scribes how a society focuses on either theindividual or the group. Individualistic so-cieties encourage their young to be inde-pendent and look after themselves. Col-lectivist societles stress lhe pilmacy of thegroup over the individual. In collectivist

cultures people are born into in-groups,identity is based on the social network towhich one belongs, harmony should always be maintained and direct confionta-tions are avoided, management is a man-agement of groups and relationship preva i l s over task . imp l ica t ion fo rcrosscultural negotiation? Collectivistsocieties stress the need to build thatare crucial in negotiations, which maytake months and yeats, and changingnegotiators may mean changing relation-c h i n c r l r r t r r l . n r I n n 4 t i m a t n h r r i l dJ l l l P ) L l l d t L d N ( d l u l l B r r l u r r u u u l r u ,

In individualistic societies, negotiatorsa r e m o r e i n t e r c h a n g e a b l e , a n d c o m -petency. rather than relat ionships isa more important consideration in choos-ing negotiating partners. Negotiators fiomcol lect iv lst countr ies l ike Indonesia,Singapore, Taiwan, and Thailand arelikely to develop and sustain long-termrelationships than those fiom such indi-vidualistic countries as the United States,Australia, Great Britain, and the Beneluxcountries.

Mas culinity /fe minintty are valuesidentified with such traditional masculinequalities as assertiveness, competitivenessand materialism, or feminine qualities suchas being nurturing or belng concernedabout quality of life and relationships. Infeminine cuJtures, men, l ike the women,are allowed to be tender and concernedabout relationships; there is sympathy forthe weak, managers use in[ui t ion andstrive for consensus and conflicts are re-solved by compromise and negotiation.

On the other hand, in masculine cul-tures, men are tough, ambitlous and as-sertive while women are tender; thesecultures have greater sympathy for thestrong ln whlch managffs are expected tobe decisive and assertive and stress is givento equity, performance and competition;conflicts are resolved by fighting them out.Implication of this dimension on negotia-tion? Negotiations becomes more competi-tive when negotiators come fuom mascu-line cultures such as the continental Eu-ropean countries: Austria, Switzerland,West Germany, and Japan; negotiatorsfiom feminine cultures such as Sweden,Norway, the Netherlands, and Denmarkfmost feminine) and Asian countries likeThailand, South Korea, Taiwan, and Indo-nesia are likelier to empathize with theirnegotiation partners and ate more recep-tive to compromlse. Uncertainty Avoid

ance refers to a culture's discomfort withuncertainty, preferring stability and predict-ability; In cultures with weak uncertaintyavoidance, ambiguity and uncertainty area way of life; aggression and emotionshould not be shown, and precision andpunctuality have to be learned.

Uncertainty Avoidancets fear of un-certainty and ambiguity, and in cultureswhere this is prevalent; unfamillar tasksare not appreciated. There is a strong in'ner urge to work hard, and precision andpunctuality come naturally. Implicationfor negotiation? Negotiators who comefiom strong uncertainty- avoidance cul-tures such as Germany, Switzerland, andAustria are not comfortable with ambiguous situations and would rather have stablerules and procedures when they negoti-ate. On the other hand, negotiators fromweak uncertainty-avoidance cultures suchas India, Indonesia, Philippines, and theScandinavian countries are comfortablewith ambiguity and can easily adapt to^ L ^ - ^ i ^ ^ - i + " ^ + i ^ h .L l I d r r B t l l B ) l L U d L r U L r J .

The Hofstede fiamework provides a^ ^ ^ r ^ + ^ - + f ^ - ^ ^ - ^ 1 n p o o i n q i n l oB U U U ) L d l L l U l ) U l l l q L . - - o - - - . o . - - . -

crosscultural negotiation; earlier I hadhinted at the tremendous task for some-one who wants to explore and understandthe subterranean portion of the culturaliceberg. In proposing this fiamework, I'malso suggesting that crosscultural negotia-tors take some lime to understand this andother similar fiameworks for the light theycan shed on negotiators' behaviors thatrather often appear odd or incomprehen-sible.

Asia is a rich minefield for research oncrosscultural negot iat ion. In the west,research on negotiation has been ongo-ing for the past four decades. There ismuch in Asian negotlation style, expecta-t ions, interact ions, etc. that need tobe researched on and more important,documented and val idared not just forthe purpose of sharing these researcheswith the West what they need to learnfiom thelr Asian negotiating partners, butalso for the purpose of developing theAsian negotiator. Negotiation skill isdefinitely one of the skills needed for theworkplace of the future. The crossculturalnegotiator, because of his ability to negotiate and because of his crossculturalknowledge, will have an edge over otherswho do no t posses the same sk t l l s

I

10 The Asian Manager I September-Octobef 1998

and knowledge.

PUBUC PRoF|LPRIVATT SERVICE

Public rcsues will come and go; increasinglyconstituencies are here to stay

Price Waterhouse team, in a bookabout managing public resoulces,says that the increasing scarcity ofresources and a very discriminat-

ing public have prompted the public sector to become more concerned about theway it manages its money, personnel, fa-cillties and equipment. The object is howto make effective use of resoulces to re-spond to the needs of the citizenry (no-tion of accountability) and how to usethese resources more efficiently (notion ofptoductivify). The goais of Public ResourceManagement are to ensure that availabletesources will be used to satisfy the mostimportant public needs; that the resourcesare managed effectively to meet the goalsand objectives established for specific pubiic programs so that they may be used efficiently to maximize the output of workper unit of expenditure. A lot has beenwritten about the difference between man-agement ln the public vis-a'-vis the pri-vate sector. In both sectols you perform

the same business or enterprise functionsof production,/operations; maiketing; human resources development; and finance.You also perform the same managementfunctlons of planning, organizing, direct-ing, controlling, leadership, and settingdirection.

The Big DifferenceThe difference is in the fact that in the

public sector you have more and variedconstituencies. For example, we have thefollowing in the Public Sector:

r The Commission on Audit (COA) isthere to help management make decisionsor to help facilitate decision making. Thereare times, however, when its rules, or thenarrow interpretation of rules, result instraitjacket-type situations that prevent onefiom exercising creative or imaginativemanagement.

r The Civil Service Commision pro-tects the ordinary civil servant. Sometimes,however, parties use this protection to

Juico: The here andnow demands trust

camouflage their inefficiency or laziness.One must go through a long and tediouslegal process to remove the bad eggs.

I Congress gives life to our laws or topolicies contained therein, to implementthem. If one interprets them not in accor-dance with the wishes or interpretationof the lawmaker, one can be haled tocourts for criminal offenses.

r The Executive Branch is the Officeof the President, or the Department of Bud-get and Management.

r In the media, one spends more timeexplaining why one did what he or shedid.

r Other Public Sector constituenciesare loca l government un i ts , nongo-vemment organizations, stock /stakehold-ers, suppliers, creditors, and customers.

The issues to be raised by the differentconstituencies will deflnitely change, butthe constituencies will remain the same,and new skills (e.g., iTrelated ski1ls) willbe needed. In addition to the present ones.

September-October 1998 | The Asian Manaser 1l

ln the

vocabulary of

management,"accountability"

is threatening to

become one of

those

buzzwords with

multiple

meanings,

depending on

who's talking

"old" skills (human relations; negotiatingskilis) will be very much needed. Someissues that are very popular today but towhich no one or very few paid attention20 years ago are environmentalism, em-powerment, gender equity, or the rightsof of the disabled.

Both the public and private sectors facet h a c e m p n r n h l a m c T h p n r r h l i r c p r l n r ' (

chiefpurpose is generally to provide (andnot nroducel needed services and facili-ties rather than generate products for sale.

All these point to a need for sponsor-ing,zinitiating change wlthin the organiza'i lon, whether publ ic or pr ivate. A Price

Waterhouse "change team" says that toq n n n q n r c r r c c o c s f r r l r - h : n o p n n p n p o d s

an attitude described in four values asfollows:

I A new level of honesry. The pain andhard work accompanying real change necessitates a level of candor too many of usfail to achieve.

I A new level of courage. There is toomuch talk of slaying the sacred cows butfew are actually slain. Most die of old age.In large-scale organizational change, manytough decisions are encountered. Boldness is called for.

I A new respect for diversi ty. Theworkforce is changing a1l over the world.B r i l l i a n t m a n a g e r s w h o h a p p e n t o b ewomen, members of a mlnority, or are for-eign nationals, are becoming major players in companies, and their numbers areincreasing.

r A new sensitivity to all stakeholderuand constituencies. Just as markets are be'ing continually refined into narrower andm n r p c n p r i f i c n r n o r z m q n n e ' s . c h : n o p

program w111 need to segment stake,/stock-holders and cont i tuencies, and acknow-l e d g e t h e i r i n d i v i d u a l a n d u n i q u eCONCEINS.

The Price Waterhouse change team alsocautions us that in the vocabulary of man-agement, "accountabi l i ty" is threateningto become one of those buzzwords withmultlple meanings, depending on who'stalking. For rhe record. accountabi l i ty in

cludes mission statements, pinpointing ofresponsibiliry results measurements, te-porting and evaluation.

The accenred indicaror of ef fect ivenessi n r h p n r i v : r p q p a l n r i ^ ^ * ^ { i '

- - - . . J P l U l l L r d l l u l l -

: m h i o r r n r r q m p ) c l r r p C , n r r p r n m e n t n n

rhe other hand. aims to provide the highesr qual i ry services and goods but with-in the constraints of i ts resources, a-m o n g w h i c h a r e . e x i s t i n g l a w s a n dpolitical and social pressures.

A . ; - ^ 1 1 n r - r n i z n r i n nAs ln al l 0fganrzdrrons. resource man-agement is affected by a multitude ofi n t e r d e n e n d e n r a n d o f t e n v o l a t i l efactors. Different conditions and needsdemand different solutlons. Whatever) nn r r r r . h i c r hncon i t r p f l p r t s t hp m : i n r

r n n d i r i n n c r h a n r r h l i r p v p r v u r h a r e

i r r c t l v r ^ r r r n f n r t i r n : t p l r i f n r r h p) - " " 1

" . - l m i - i c r " ^ r a r " n i " c r l r r l j p q i q l q l l n n n .d u l l l l l l l J t l d t U l . u l l J U J l l y l " ' J T J L J u p w r i .

A e r n r r n t r h i l i r v f n r r a c r r l t c l n r ; r t i n n. / , " , ,a t r h e I e a s r p o s s i b l e c o s t l a n d p r o -d r r c l i v ; r v r i m m e d i a t e a c l i o n a n dn r n d r r r t i n n l

Fine l l v rhp p , i , ^e warp lhouse team a lsoa r a r u a a / t

s a i d t h a t a c c o u n t a b l e o r g a n i z a t i o n sand persons know their purposes andresponsibilities and are able to distin-o r r i s h h p t w e e n p s s e n t i a l s a n d n o n -

e s s e n r i a l s . A c c o u n t a b i l i t y m e a n sh p i n o r p s n o n r i h l p f n r a n d r p s n n n s i v p

r o a c t s a n d r e s u l r s r e l a t i n g t o t h emiss ion . For to a t ta in resu l ts i s tor e a l i z e t h e m i s s i o n o r o b j e c t i v e s o flhe organization.

Profit or service? ln the private sector, the former is the yardstick. ln the latter, constrained attempts at serving the public

ry{Q . !{r;

!'- $\ .-1

$s

l2 The Asian Manager SeptemberOctober 1998

Early warning signals foreconomic turning points can come from BCI that measures business attitude change.

Developing

ry J;:ilRsneCONHDTNCT

INDTXol icy Forum's motivat ion indeveloping a Philippine businessconf idence index {BCI} is to pro-vide businessmen and managers

with a useful forecasting tool, helpful inanticipating critical economic tufningpolnts.

A turning point can be an upturn or adownturn in business activities. In eithercase, BCI statistics give early warning sig-nals. They point to the direction and char-acter of preparation that businessmen andmanagers must make to take advantageof emerging opportunities or to guardagainst impending hardships.

The BCI LogicCanadian businessmen who use the

"lndex of Business Confidence" providedby the Conference Board of Canadaquarterly say: "The Index of BusinessConfidence quantifies for us what we allknow as true. How much business investment we'll see ln the future is dictated

by today's business investors' outloolcWenwe're all pessimisttc, the Indexteilsus how much and when a dip in industrysales is likely to come. When we're bull-lsh, it tells us how much surge in saleswe can expect at a particular monthlater this year. Thereb almost no waythat the Index ofBustness Confidence cango wrcng. It's saying a very simple thing:what a bus[nessman wills is what willhappen."

These suggest that the BCI obviouslydraws i ts logic from some socialpsychological behavior principle. Itspremise is actualiy a well-known andaccepted behavior model which says:"Every external change in behavior ispreceded by an internal change. It isattitude change that precedes behaviorchange."

We can paraphrase this principle forBCI to stale: "Every external change inbusiness activities is preceded by an lnternal change of business outlook. It is

business attitude change that precedesbusiness activity change. "

BCI can be made flexible enoughto predict other business act iv i tycategories. For this extended use, itssurvey can just be replicated in otherbusiness sectors and the appropriatesurvey questionnaire items modified oradded.

Toward the "Ideal" BCIThe more accurate in timing and mag-

nitude the BCI predictions of businessdownturns and upturns become, the closerthe Index'gets to the users'ideal. This ac-curacy is a function of the survey's owntiming and index component variables.

In any given business sector, an eco-nomic turning point can take place in anymonth of the yeu. This occurrence shouldbe preceded by a corresponding BCI turn-ing point. By how many months the BCIturning point will precede the economicturning point will vary according to the

September-October 1998 | The Asian Manaser 13

category of business activities oI businesssector being predicted. But it is cleal thatit is the monthly monitoring that is bestset up to do the kind of turning point prediction that we want fiom a BCI. The Ca"nadian and the U.S. BCI service are quar-terly surveys. So it can be said that theyhave a three-month "blas" and can missthe turning point by that much time.

The choice of three months as theintersurvey time interval is an economicchoice. Surveys cost money. Over theyears, survey price increases have beenexceeding inf lat ion rates. But thereare ways of making the survey costaffordable. One popular way is syndication.This consists of recrui t ing severalinterested paying subscribers to thesuruey. Through this approach, monthlymonitoring suruey services have beensuccessfully offered by several largesurvey organizations such as TRENDS/MBL, Frank Small & Associates, andConsumer Pulse.

These monthly tracking surveys makeuse of the so called roliing envelopesampling. Every week, 25 percent of thetotal survey sample respondents are re-placed by a new sample. After four weeks,a completely new total sample is obtained.This makes for an every-month survey. ThePolicy Forum BCI survey proiect can pat-tern its sampling to this procedure so thatit can, in effect, offer the business com-munity a continuous tracking of economicactivities and business confldence.

On the issue of the Index's componentvariables, what confidence index variableswill work and predict well is a matter ofrepeated surveys and predictions. Ofcourse, theories about what variables de-termine the state of business confidencein a particular sector will help in inltialformulation of the Index's equation. Butthese variables' predictive ability and explanatory power will have to be tested overtime to finally qualify them as the Index'sfinal component predictor variables.

The matter is not an issue of testingfor cause-and effect. It is only a predictionissue and therefore merely a question ofcorrelation. We know fiom past forecast-ing studies that what predicts most is notnecessarily what is logically the most plau-sible "cause." In fact, there have beenmany predictive equations whose best pre-dictor valiable is difficult to relate or is re-motely related to the criterion or depen-

dent variable. Al1 these make the timlngissue the more critical one to resolve.

TWo Sectoral Surveys, Three Is-sues

Before looking at the survey results forthe banking adn electronics export sectors,let us examine three issues relating to re-search design, survey methodology andsurvey results with the end in view of im-proving the next wave of surveys.

During the reseatch design phase of thebanking sector survey, this issue wasraised:

"For developing countries, bank lending portfolios are an indicator of economicprogress because growth is [nvestment orindustry driven. In developed countries,housing stats are a good indicator becauseWestern economies are consumer driven.so in the banking industry survey, weshould ask the following information:

[1) what the current distribution ofloans by industry is, and

(2) what the expecteddistribution six months orone year from now willbe.

We're assuming herethat the answers to thesetwo questions will vary.But is itfair to ask the re-spondents why the var[ation exists."

The issue comes fromunfamiliarity with surveydata collection as well assuryey data analysis sys-rem First of al l . i t is notv r q r r t r ! ] v r 1 !

an issue of fairness. It is amatter of the quality of theanswers that comes frolnasking that "why" ques-tion. This is one of thoseoccasions in survey datagathering when all thatthe interviewer gets arestereotyped and generalanswers. what this suggests is that if one is afteran explanation, then thatshould not be squeezedout of the survey respon-dent. The explanat ionshould be drawn by analysis. It cannot come by design, that is, by asking ad i rp r t n r r pq t i nn

The by analysis solution involves ana-lyzing the data under a propositlon thatruns like this:

"The variation in expected versus cur-rent loan to manu;t'acturing is afunctionof: ( 1 ) the variation in expected versus current loan to agribusiness, r2) the variation in expected versus current loan toconsumers, etc."

Then a simi lar nronosit ion can be for-mulated for each variat ion in the indepen-dent variable, treated in its tutn as a de-pendent criterion variable.

Tha n rnnnc i t i nn i q i n mr r l t i n l p r eo rps -r r r r " ' " r v r ! r r

sion format. So, data anaiysis must pro-ceed along a multiple regression process.The independent variable varlation thathas the largest beta coefflcient becomes"the explanation" sought. Ifthis provokesa concern for the independent variablesbeing intercorrelated, then the regressionsuffers fiom multicollinearity. This problem can be handled by using the stepwiseregression procedure. An alternatlve is to

How is the 'p r inc ip le t rans la ted fo r va l ida t ionthrough a survey procedure? A closer look ofthe Conference Board of Canada's Index of Busi-ness Confidence survey design for machineriesand equipment shows:

First, what external business activi ty change ismeasured and monitored? The survey does notmeasure this variable. l ts data are regularly pub-l ished economic stat ist ics.

Second, what about the internal business out-look or business att i tude change? This consti-tutes the index i tself . l t has four survey compo-nent percentages namely: the percent of sur-veyed businessmen saying that:

I Over the next six months, they expect theirf i rm's f inancial posit ion to improveI The present i s a good t ime to under takeexpenditures to expand their plant or add tothe stock of their machinery and equipmentI Their current level of operations relat ive tooptimal capacity is above capacityITheir current level of operations relat ive tooptimal capacity is at, or close to, capacity.

The index is computed as the summation of thesefour percentages (P) divided by their summationduring the base year ( i .e.,1977 when the servicestarted) and then mult ipl ied by 100. In equationform:

BCI = (Pl + P2 + P3 + P4) for this vear x 100lP1 + P2 + P3 + P4) tor 1977

14 The Asian Manager I September-October 1998

f i rsr subiecr the independenr var iables roa factor analysis. Then the obtained fac-tors can be used as the independent vari-: h l p s i n r h p m r r l f i n l p r r. Jgressl0n.

For the survey of electronics exporters,another issue was raised:

"ln the export sector suruey, we wantro match expectations from the exporters agalnst actual results as well as aga[nstthe Philippines 2000 Plan which retiesheavily on exports."

This is a validation issue and concetnsthe concept ofpredictive vaiidity. Its ques-tion is: "Did the prediction of the studyabout the timlng and magnitude ofchange or turning point actually happen?"

To obtain this vaiidation, at least twowaves of the BCI survey musr take place.In survey wave #1 , the Policy Forum andits BCI investors must limit themselves tothe forecast of the expectations. Compari-son with actual results must wait for thepredicted timing of the turning point. Thismeans that presentarion of the survey re-sults for wave #1 cannot include the validation of the BCI prediction.

Comparison wirh what acrual ly hap-pened can be done in survey wave #2.Here survey wave #l forecast or expecta-tions can be compared with actual results.Also, survey wave#2 includes the nextpenod's forecast or expectations.

A thlrd issue asks:"How can we include other related

items in the survey? That is, what if wewant to measure the performance of different kinds of banks? 04 what if we wantto compare 'sunrise' and 'sunset'indus.

tries? How can we dfferentiate thegrowth rates of independent exportersc o mp are d wit h mu ltin a tio n al su bc o ntractors and so on."

Once again, rhis issue comes out of sur-vey ill iteracy particularly wirh regard rosurvey data analysis. The survey lireraturemanages this issue by the subsampie analy-sis approach. Each subsample wi l l repre.sent each kind of bank or the sunrise orthe sunset industry or independent export-ers. etc. This will yield the sought.for dif-ferentlating and comparison data.

However, this solution has implicationsfor the survey sample size. Having severalc , , h c r m n l a . ^ ^ 1 " . ^ - L ^ , , i ^ -J u u J o i l r p l r d l l d l y J r J L l l c d l t ) i l d v l t l g )

analyzeable subsample bases or sizes. It isthe Malthusian Law intruding into surveysand it states: "As you arithmetically increase the number of subsamples you

want to analyze, you must geometricallyincrease your total sample size so you canget statistically significant results;'

Let us now look at the survey resuits.

BCI and Commercial BankingPolicy Forum's first sectoral business

conf idence s r r rvev nn the cOmmerc ia lbanking sector was a census of the 32 10cal commerciai banks. I t succeeded in get-ting28 of these banks to cooperate repre-senting an BB percent response rate. Butth is i s ac tua l l y h igher . Of fournonresponding banks, only two refused toparticipate in the survey. One of the othertwo had merged with another bank andanother turned out not to be a commer-cial bank. This made the true response ratea very high 93 percent.

The survey obtained the high responserate because it chose the face-to-face in-terview technique of data collection. Thiscontrasts with the self-accomplished ques-tionnaire approach thatother business confidencesurveys employ.

Positive Expectatio ns.As can be seen in Table2, the data indicate thatcommercial banks weremore positive about theeconomy 's nex t s ixmonths' condltion thanabout their own sector's.Except for asset growth,banks had intensity posr-tive expectations aboutother aspects of their financlal posilion that werelower than their intensitypos i t i ve expec ta t ionsabout the economy's next'six monrhs' overall srarus.In layman's terms, thismeans: the percent of re-spondents who expectedthat thefu bank's peso andp e r c e n t e a r n i n g s i n -crease, past dues, andcapital increase would bemuch better than the pastsix months' was much/ess than the 36 percentwho expected that thec o u n t r y ' s n e x t s i xmonths ' overa l l economic condit ions wouldb e " d e f i n i t e l y b e t t e r

than" in the past six months. It is for assetgrowth where banks have a higher posi-tive expectation than for the economy: 50percent "much better" response versus the36 percent.

Lending Activities. Moving on to Table3, the very high positive intensity expec-tation about bank asset increase comesfiom the just as high 82 percent in Table2 who saw the presenr as "definitely" agood time to expand bank lending activities. This is inspite of the fact that only 21percent of these banks saw the past sixmonths as registering a bank asset growthrate that was "way above the bank's ob-jective or target."

This way above-target rating for assetgrowth was not that much higher thanthose for the banks'other financial posi-tions. These other financial positions re-late, for example, to thefu peso amount ofearnings increase (with an 1B percent way-above rating) and percent earnings in-

r ' l t is c lear that the BCI is a t ime-bound comparat ive and composite sta-t ist ic. The longer the t ime period i t cov-ers, the more useful i t becomes. Toserve i ts target user audience, the BCIsurvey as a project must therefore per-sist over t ime.

r/ l t should also be clear that themore categories of business act iv i t iesthe index is able to predict , the wideri ts ut i l i ty becomes.

r/ Being survey-based, the intentof these surveys is to obtain measuresof the expectations of leading sectorso f the Ph i l ipp ine economy.

r/ The intent of Pol icy Forum BCIsurvey is to obtain measures of the ex-pectations of a leading sector of the Phil-ippine economy. These expectations areabout the future shape of the sector i t -sel f and the larger economy in which i tis a leading part ic ipant. When obtainedover a long enough per iod , the mea-sures are usable to predict the l ikelyshape of the sector 's condit ion and thatof the larger economy.

September-October 1998 The Asian Manager 1 5

crease (with a similar 18 percent way-^ l - . ^ " ^ r a + i n a ld u u v c r c u l r 6 . i ,

Tab\es 2 and 3 survey data analysis in-timate a story of all 28 banks expectingtheir total loans to increase over the nextsix months. At the present time, currenttotal loans, on the average, go to the sec-tors as follows:

Manufacturing is the banks' leadingmarket for their asset products. Servicesare a far secondary market segment. Con-sumer spending for both durables (that is,for real estate) and nondurables, whencombined, are the banks' true secondarymarket segment for their lending activi-ties. Agriculture takes a minor if not a mar-ginal position.

Geographically, some two thirds ofcurrent total loans go to the NationalCapital Region. This makes it clear thatthe banks' market for its loan productsis largely Metro Manila. The rest of theremaining loan funds went to the other14 regions.

Factors Behind Expectations. The sur-vey asked respondents about the factorsthat affected their expectations.

The close-ended question presentedeight preselected factors with a provisionfor "othels": ( 1 ) foreign exchange rate, (2)labor strikes, (3) unemployment, (4) in-terest rates, (5) competition like foreignbanks'entry (6) new Bangko Sentral rulesand regulations, (7) new laws and legislations on banking, and (B) changes in gov-ernment policy and thrust. The surveyasked respondents to "check all fthe factors) that apply" in their particular case.

"lntetest tates" and "competition" werethe number 1 and the number 2 mostchecked influencing factors for both theeconomy and the bank loaning aclivities(See Table 4.)

When asked open-endedly about thesefactors in relation to their expectationabout the economy, a different set andordering of factors were obtained. The topthree most mentioned were:

I ) Mote investments,/foreign invest-ments (35% mentions)

2) Political stability (20% mentions)3) Stable foreign exchange rate(20% mentions)It is more representative of actual busi-

ness sentiments to rely on these voiun-teered "reasons" than the checked listedones.

The optimism about the economY and

lending activlties comes in spite of the 68percent expectation that current inflatlonrate (as of the r ime of the survey) of8.4 percent would be higher over thenext six months. The average expectedincrease was a plus I .6 percent or anexpected 10.0 percent l= 8.4 percent +I h n p r . p n t l i n f l : t i n n r a t e h v e n d o fr . v y ! ,

1 OO6'c f i rs i r r r r r tpr

The three most mentioned forcesperceived as raising the inflation latewere:

1) The llkely oil, fuel or gasolineprice hike l58% mentionsl

' ) l T h a n r i r o i n r r o a c p : n d s r r n n l v

crisis in commodities especiallYflce (53% mentions)

3) The likely wage increase(21% mentions)

Electronics Export SectorThe second Policy Forum sectoral sur-

vey was on the electronics export sectol,with 50 random represen-tative electronlcs exporters.The survey used as sam-pling frame the verified listof the Board of Investments(BOI ) . Ver i f i ca t ion byphone, actual site visits andinterviews proved that us-ing alternative lists fiom theDepartment of Trade andthe Directory of Exporterswas illadvised. The lists hadtoo many companies whoturned out not to be actualelectronics exporters. Theysimply wanted to be listedor had exited fiom the busi-ness and entered a new one.Even the BOI list was notper fec t . Many namesturned out to be "tempo-

rarily" not exporting andwere doing something else.

The delay that develop-ment of an acceptable listcaused was lengthenedby two additional factors:( 1 ) the high incidence of un-qualified respondents, and(2) nonresponses in lnter-viewing the sample respon-dents from the final BOI list.Faced with a stict timetableand budget, the survey hadto limit itself to completing

only half of its orlgtnal target 100 quotasample.

The exnerience sussested that in the' " * @ '

Phi l ippine sett ing, a BCI survey is moreeffectively and usefully conducted with a" P r r o t n " c e m n l p T h i c i c t h p s e m n l p o f

J q r r L y ' ! .

c o m p a n i e s i n a l e a d i n g s e c t o r , w h orepresent the top 20 percent of all compa-nies but account for B0 percent of thesector's revenue. These are the companiesthat also formally forecast and are there-fore more capable than others in answet-ing the forecasting questions of a BCI sur-vey. This should be a consideration fot thePolicy Forum's next round of BCI surveys.

Macro and Micro Expectations. Relat-ing expectations on overall economic con-ditions of the country in the next slxmonths and the respondeni exporter's fl-nancial position also ovet the next sixmnnrhs i r can hp seen that the electron-ics exporters were more positlve about theeconomy than about their own sector. It

. For each of Policy Forum's sectoral surveys, it

engaged the services of eight professional executive

interviewers for data collection. The Policy Forum Sur-

vey Research Desk trained the interviewers, and de-

s igned and pre- tes ted the survey 's s t ruc tu red

questionnaire.The interviews were arranged by writ-

ing first to each of the corporate planning officers of

the sampled companies inviting them to participate in

the survey. Where there were no such officers, the

ones responsible for skategic planning were invited.

Then, the executive interviewers followed up with

phone calls for interview appointments (Table 1).. Data collection from mid-October to the first week

of November 1995 for the banking survey and from

mid-November to mid-December 1995 for the elec-

tronacs export survey.

One was about the overall economic conditions of

the country in the next six months. The other, about

the respondent's financial position also over the next

six months.. Survey S-point scales: On the economy, the scale

used was: 5 = expecl to be definitely better; 4 = ex-

pect to be probably better; 3 = expect to be about the

same; 2 = expect to be probably worse; 1 = expect to

be definitely worse. On the financial position, the scale

used was: 5 = expect to be much better than the past

6 months;4 = expect to be better than the past 6

months;3 = expect to be about the same as the past 6

months:2 = expect to be worse than the past 6

months;1 = expect to be much worse than the past 6

months.

16 The Asian Manager I SeptemberOctober 1998

Expectations about

Expectations about the Economyand the Bank's Financial position

Eusiness Confidence Survey of Commercial Banks(Base = Total 28 Oualif ied Respondents lnterviewed)

When asked about these factors, a dif-ferent set and a different priority of factors were obtained. The rop three were:

I I More invesrmentszforeign invest-ments [55% mendons)

2) Poiiticai stabiliry ( 16% mentions)3) Stable foreign exchange rate{ l6% mentions)Again, this is more representative of

actual business sentiments.The optimism about the economy and

exporr ing acr iv i t ies comes inspire of the42 percent expectation that current infla-tion rate (as of the time of the survey) of8.4 percent would be higher over rhe nextsix months.

The three most meniloned forces per-ceived as raising the inflation rate were:

l lThe r i ce c r is is 133?o menr ions)2) The calamities that continue to visit

the country Q4% menttons)3) The likely wage increase or demands

for it (24% mentions)Export Friendly Banks and Govern.

ment.The survey also asked respondentswhich bank and which government officelhey regarded as export-friendly.

o/o of Base RatingTop-Box 2-Top-Boxes

Overal l economic condi t ions

The bank 's

Asset growth

Amount of earn ings increase ( in pesos) 1 4 82Earnings increase ( in percent) 1 4

Past dues

Increase in capi ta l t c21

Note: Top-Box rat ing = 7o rat ing "definitely better" or , ,way above,,; 2-Top-Boxes rat_ing=y . ra t ing"def in i te lybe t te r " l "wayabove" +yora t ing"probab lybet te r " / "above. ' ,

is 30 percent versus I B percent intensityrating. (Table 3)

The 1B percent expectation of a "defi

nitely better" financialposition in the nextsix months seems optimlstic when con-sidered against the perception of past sixmonths' performance. Only 6 percent ofthe exporters saw their past six months'financial position as "way above the com-pany target." Table 6 shows though that36 percent saw their past six months'f inanc ia ls as "above the companytarget."But this figure is not a top-box scorestatistic and therefore not comparable tothe 1B percent "def ini tely berter" rat ing.

The opt imism cont inues with thejudgment on the present as a good timeto expand export activities. A high 54percenr of the exporters said they feelthis is "def inirely a good r ime ro expand."In responding to the next question ofhow they felt about their growth rate inthe next s ix months relat ive to thePhillppines 2000 target of 20 percent, agood 62 percent said they expect rheircompany's growth rate would be "much

gleater or greatef than the government tar-get." (Tab1e 4)

Almost eight out of ten exporters ex-pect their total export sales to increase overthe next s ix months. Ar rhe present r ime,62 percent of the surveyed exporrers sellto the U.S.; 40 percent to the three Euro-pean countries of Germany, England and

France; 38 percent to the ASEAN countries; 34 percent to other European coun-tries; 30 percent to Japan and 30 percentto other Asian countries.

The expectation of in.creased export sales takesplace despite exporters' an-t ic ipar ion of increases inthe cost of all their pro-duct's component costs es-pecially labor and energyand power. Imported rawmaterials and labor to-gether account for 60 to 65percent of an electrontcexporter's total costs.

Factors Behind Expectations. On rhe factors thataffected their expectationsabout the Philippine economy, the exporters' topthree most checked influ-encing factors from thepreselected list were: laborunrest, foreign exchangerate, and interest rate.

The top three influen-cing factors for their ex,pectat ions about exportsales were the same but ina dr f fe ren t p r io r l t ysequence: fo re ign ex-change rate, interest rate,and labor unrest.

Why intensity expectation data: Intensity datarefer to the percent responding via the "definltely

better" or "much better than," i.e.,the top-boxscore answer in the S-point response scale.Thisis used rather than the "average" rating, giventhe practice to regard intensity data as more ac-curate than non-intensity ratings. Methodologi-cal survey research has determined that respon-dents tend to answer with non-intensity ratingsfor reasons other than what they actually believeor feel. ln the present case, we can expect re-spondents to answer with the "generally" or"probably" better or worse response ratings whenthey just want to be polite to the interviewers, orin order to give an answer for the sake of an-swering. An average rating combines these lessclean responses with the cleaner ones from theintensity ratings. For this reason, an averagescore then is a "contaminated"

score. The sameassessment applies to the use of the "2-top-box"

scores, shown in the second column of statis-tics.

September-October 1998 The Asian Manaper

There were 15 banks named bY theinterviewed exporteru. Not one had a re-a1ly dominant position over others on thisposition. This is readily apparent fiom thesize of the percent mentions garnered byr h p r n n r h r e e m o s l m e n t i o n e d b a n k sL r r ! L v P

named as most export-fiiendly. Thesewere:

lJPCIB (14% ment lons)2) MetroBank (12% mentions)3)UCPB (12% ment ions)

Ir is different with government offices.Exporters were more unanimous. The topthree most mentioned of these were:

1) DTI/BOI (62% mentions)2) DTI/BETP [40% mentions)3) EPZA (26% mentions)

Asked how they saw governmentagency services improving versus last year,most (44 percent to 66 percent of them)were unable to make an assessment. Theexception is with DTIIBOI where 56 per-cent of the exporters said this offlce hadimproved its services over last year.

In retrospect, glven Policy Forum'spreliminary work toward developing aPhilippine BCI, one wonders if Philippine businessmen, can say, with Canadtanbusinessmen: "There's no way that theindex can go wrong. It's saYing a verysimple thing; what a businessman willsis what will happen."

Assessment of the Bank's Financial Position in the Past Six Months

Eusiness Confidence Survey of Commercial Banks(Base = Total 28 Ouali f ied Respondents Interviewed)

Yo of Base RatingAssessment of the Bank's Top-Box 2-Top-Boxes

Asset orowth 21 57

Amount of earn ings increase ( in Peso) 18 54

Earninqs increase ( in percent) 1 8 57

Past dues

lncrease in

32

39

Note: Top-Box rating = % expecting item to be "way above" the objectiv-e or target;2-Top-Boxes rat ing = % expecting i tem to be "way above" plus "above" the oblec-t ive or target.

Factors Checked as Affecting Expectations about the Gountry'sEconomv and Total Bank Loans

Business Confid6nce Survey of Commercial Banks(Base = Total 28 Oualif ied Respondents lnterviewed)

Yo of Base Giting forEconomY - LCnding

Influencing Factors ,Expectation Expectation

lnterest rates 89 7 1

Comoet i t ion 6886

$-Peso exchange rate 75 43

T New legis lat ion/ laws on banking 57 29

Government pol icv changes & thrust 57 29

New BSP ru les & regulat ions 5050

Note: Only those factors with 20% or more cit ings are included.

ReferencesConference Board of Canada 11992), The Relevanceof the Index of Business Conftdence as a Forecastiitg l-ool. Oniario, eanada: CBC.

Kerlinger, Fred N. { I ABol, Foundations of BehavioralResearch. New York: Holt, Rinehart & Winslon.

Labaw, P. (1980), Advanced Auestionnaire Design.Cambridge, Mass: Abt Books.

Leedy, P.D. 119B5l, Practical Research: Planningand Design. New York: Macmillan Publishing.

Mowdav, R.T. and R.M. Steers, eds. 11979), Researchin Orgalnizations: lssues and Controversies. SanlaMoniia, CA: Goodyear Publishing.

Pedhazur, E.i. {1982), Multiple Regression ln Behavioral Researih: Exflanatioh and Prediction. NewYork: CBC College Publishing.

Roberto, E.L. {1996), (lserFriendly Marketing Research. Metro Manila: Life Cycle Press Asia.

Solomon, D. and L.R. Frankel {IQBB), fechniquesfor the Cost Efficienr Sampling of Snall or Rare Popu/arrbns. New-York: Audits & Surveys.

Zeisel, Hans 11985), Say It with Flgures. New York:Harper

Expectations about the EconomYand thti Exporter's Own Financial Position

Business Confidence Survey of Electronic Exporters(Base = Total 50 Oualif ied Respondents lnterviewed)

Versus the Current, ExPect thingsto be over the Next 6 Months

. o/o of Base RatingOverall Own Fin'l

Economy Position

Definitelv/much better 30 18

Probably better/better 46 , 56

About the same 18 20

Probablv worse/worse 4 6

l8 The Asian Manager I SeptembenOctober 1998

Definitely/much worse

By Dato Sri Mohd. Najib Tun Razak

In Search ofTransformational

TEADERSHIP"lnformation explosion" defines the new economy-thus the need for a new breed of leaders

e are in the threshold of a newera. In less than two years, we willdraw the curtain on the 20th cen-tury and step into a new mil-

lennium.We in Asia find ourselves almostswamped by rapid economic development.Prosperity appears to be the norm ratherthan the exception. But we must bewareof complacency because it is up to us tomaintain the present growth and prosper-ify to assure our competitive edge.

I believe the lessons of the 20,h centurv.particularly in the last rwo decades, havealready sowed the seeds of the future,which, in reality, has begun for all of us,and contained in a few key catchphrases:"New Economy," "lnfolmation Tech-no logy , " " ln te l lec tua l Cap i ta l , " and" Globalization. "

As Minister of Education, I find com-fort in the fact that worldwide there is agtowing trend to recognize education asthe key determinant of a country's successor failure. On a personal note, even whenI was still Defense Minister, i have alwaysmaintained that a nation's defense exDen-diture should not exceed that of its education expenditure.

There is probably no better time to re-iterate it than now, having made the trans-formation from a "culture of wal" to a"cultule ofpeace." Some developed coun-tries in fact spend more on their welfaresystem, especially in health care, than oneducation. The implication of this state ofaffairs in the long term is obvious.

British Prlme Minister Tony Blair cam- Governments should thus adoptpaigned on the siogan: "what Britain probusiness policies. In Malaysia, suchneeds for a better future and to be 'gteat' policies include the Malaysia Incorporatedare three things: education, technology fMalaysia Inc.), privatization, tax incen-and enterprise, in that order of impor- tives, deregulation and even the gradualtance. "

reduction of corporate and consumer itemIf the importance of education is recog- taxes.

nizedby developed nations, then the case Governments are generally poor busi-for greater investment in quantitative and ness managers. Most government-ownedqualitative terms for developingand newly or -controlled corporations do not fare asindustrializing countries cannot be under- well as privately owned ones. It would bestated. It is, in fact, the most critical re- a sound rule for government to stay out ofsource for future growth, mote important business and iet the private sector runthan physical resource, capital or technol- these. Government should only collectogy. The accumulation and development taxes fiom them. A 30 percent corporateof intellectualcapitalmustbeaccordedthe tax (top rate in Malaysia) on some thriv-highest priorify. ing business enterprises will earn more

revenue for the government than havingSupporting Business many more government-owned enter-

If it is a truism for nations, then what prises that operate at a loss or on marginalabout organizations? Rosabeth Moss profits.Kanter, in her book when ciants Learn For organizations to flourish, they mustto Dance, concluded with a piece of ad- function in a society ch ancterized,by goodvice to corporate leaders: Have terrific govemance. The English philosopherJerchildren. The seeds of so much of our emyBenthamfoundedtheconceptofutili-future 1ie in our youth, who will determine tarianism and made famous the notion thatthe future ofour nation and our organiza- the proper end of action is to achieve thetions. $eatest happiness of the greatest number.

Governments must, at the same time, J.K. Galbraith advanced a similar notionrecognize the importance of business or- and defined good society as one in whichganizations and the private sector as a "everymemberregardlessofgender,race,

whole. Programs to eradicate poverty and or ethnic origin should have access to aprovide basic amenities require financing, rewarding life." In other words, therewhich can only be realized if the economy must be economic opportunity for all; thecan grow; and the engine of gowth can society must be compassionate and sociallyoniy come from business enterprises. decent. pure, unmitigated and unbridled

September-October 1998 The Asian Manaser 19

Every Asian must

bear his or her own

individual sense of

ethics, values and

social responsibility

growth without conceln for the poor, un-derprivile ged and marginalized communi-ties can only lead to a fiactured and fiagmented nat ion. Only when growth isachieved with equity and socialiustice cana nation be strong and cohesive.

What challenges do Asian managersface?

First and foremost. it is ro understandthe "New Economy." The new economyis a knowledge economy. Knowledge iscreated by human beings, by knowledgeworkers and by knowledge consumers. Tobeg in w i th . the knowledge conten t o fproducts and services is growing significantly as consumer ideas and informationtechnology become part of the sociery.

In Malaysia, we will soon introduce the"smart card" for each and every ci t izen.These smart cards will contain all the nec-essary vital information fiom cradle tograve. There will also be "smart" kiosksln the near future where Malaysians canpay their traffic fines by simply introduc-: - - ' � ! ^ *^ -+ ̂^ - r - { -+ ' "^ k iosks and deb i t -l l r E J ) ' l ' l t d l L L d I U J d L L r r ( .

ing the arnounts fiom their account.On the other hand, organizations will

have their own mission statements andgoals. The challenge, however, for a1l man-agers would be to transform these state-ments into shared goals and shared visionat all levels of the organization.

Info "Explo"

This new era has also been describedas the " lnformation Age," though somewould argue that "lnformation Explosion"is the more appropriate term. During theindustrial revolution, there were perhapshalf a dozen ways in which to transmitinformation. Today, there are somethinglike 37 different ways to disseminate in-formation. Asian managers must thereforelearn and harness information technologyin order to leverape their resoutces andbecome more competitive.

But over and above al l these is perhaps

the most important prerequisite fot suc-cess: leadership. The underlying reason forany success behind an organization ornat i0n is the quest ion ol leadership. I t iseasy to produce managers but it is leaderswho will make the difference. You mustgrow as a person to become leaders ofyourorganization and ofyour society.

True leaders can look beyond the hori-zon. They can motivate and inspire people,but above all, the true worth of leadershipis when it could be ca11ed a "transforma-

tional leadership." Asia will need to pro-duce transformational leaders who willlead their organizations and bring out thebest ln each and every indlvidual, inspirethem, make strategic and visionary deci-sions, go beyond accepting the status quoand transform their respective organiza-tions into world-class enterprises.

Upbeat TrendsAs an Asian and as a member of the

Association of Southeast Asian Nations(ASEAN), I feel that the Phi l ippines deserue to take its place rn the ranks of pros-perous nations. A May 1997 issue of lheAsian Wall Street Journal noted the Philippine economy's GNP growth of 6 per-cent in the first quarter ol 1997. The roadahead for the Phillppines indeed lookspromising.

r - rh i - - ^ -^ . i ̂ - ̂ - :mber o f AsEANl i l L l I l ) t c F ) d r u r d ) d l i l r

and as neighbors, we should engage incooperative policies and ventures that willenhance the prosperity of our neighbors;

after all, we should always remind our-selves that we ate members of a familyca11ed ASEAN.

Asia will certainly be at the forefiont ofthe ) .1 cennrrv and al l of us shoulder adeep burden to make a meaningful con-tribution to our respective countries andprofessions.

There is a need for leaders who willredefine and mold the mindset of organi-zations, corporations and communities torespond to and innovate on new technolo-gies that will continually change. Suchleaders should help create a culture ofconstant learning and adaptation to changewithin organizations. A knowledge-basedmindset can and must play a meaningfulleadership role in ensuring that organiza-tions and communities are constantlylearning and being creative and sensitiveto locai cultures and environment.

Fverv Asian mrrst bear his or her ownind iv idua l sense o f e th ics , va lues andsocial responsibility. Only by constantlyreminding ourselves of the importanceof human values will we ensure thatwe retain our Asian-ness in the face ofconstant change in the 21" century.

We should and must not denigrate^ , , - , . - r , , ^ r ^ ' h e f a c e o f m a _u u l v d . l u ( ) y J L c l l l t r r L

terial progress. We believe in hard work,rhr i f t , family-or ientedness, and fai th inGod and respect for educatlon. As we be-come more affluent, such values shouldcontinue to form the cornerstone of our

w::st{r*u$3*$i"-:;

f

value system.

From ranks to reaches: in the age of information, managers are easY to produce-it's the leaders who make the difference

I

20 The Asian Manaser September-October 1998

An

Apathy and prejudice may prove more fatal than the dread disease

wo decades after the Human Im.mune Virus {HlVl that causes Ac-quifed Immuno Deficiency Syndrone {AIDS) was identified, the

disease has moved flom an epidemic ofsome high risk minorities in the Wesr ro aglobal biological war witi no geographicboundaries. In sub-Saharan AJrica, generations are orphaned as adult membersof the family are lost to AIDS. In troubledAsia, denial and relegation to hospital cor,ridors and laboratory tables are the orderof the day. Even as it continues to devastale communilies, government continueto turn a blind eye on the damage.

Getting SeriousThe implication on the economies of

rhe region is clear. As the Norh beglnsto reap the gains oftheir 2o-year efforts toslow down the spread ofAIDS and lowerAIDS related infant mortality, South Asiahave yet to wake up to the devastationAIDS will visit the region. In rhe days before the current economic ctisis, theUnited Nations Development Programestimated that AIDS will cost Southeast

Asia some [JS$56 bill ion if current trendscontinue. Today. wjrh resources for prevent ive educat jon haived to n i l . rhe lgurewill rise by factors too depressing to contemplate. And yet we must.

When AIDS isn't regarded in medicalterms, it is dealt with in economic terms.Because AIDS treatment is expensive; itmakes more sense to emphasize preven-tion. Indeed, using hard figures is some.tlmes the only way to convince governments and businesses to take AIDS seri-ously. Unfortunately, this presentation ofthe impact of AIDS tends to mask its realimpact on communilies and on peoples'lives. Mary in the medical profession claimthat AIDS is like any other disease. ln saying so they hope to eliminate the stigmaassociated with AIDS and to prevent discdmination. But 20 years of global spreadin the midst of 20th century medical science clearly shows that it is not like anyother disease. It is much worse.

No other disease has drawn responsefrom rhe pol i t ica l . economi( . )oc ia l , legal .ethical, cultural and religious sectors in-deed the entire spectrum of sociefy. Ques-

tions that were not asked about conven-tional communicable diseases were nowasked of AIDS as a matter of course: Arepersons with AIDS immoral and thereforedeserve to suflerl Should an otherwisehealthy person with HIV be refused ajob or a home? No other disease beforeor since has provoked so much contro-versy, even crossing over the ethicalborders of human rights. And no otherdisease has inspired commentaryfrom justabout everyone, informed and otherwise.The singularity of AIDS as a new globalthreat is best exemplified by the settingup of a special United Nations body solelyto manage these different aspects ofAIDS theJoint UN Programme on AIDS(UNAIDS].

At the communi ty leve1, AIDS isclouded by obstructive attitudes specificto the communiry Ar hean, the r ransmis.sion of HIV involves intimate private individual behavior the community itselfwould rather not talk about, and aboutwhich those diagnosed would rather notadmit for fear ofsocial censule, sometimesin the form of the law.

r*t

September.Octobe. 1998 The Asian Manaser Zl

Nobody

had enough

knowledge on

what to do with

people with AIDS,

so everyone

simply reacted

cruelly

Untold StoriesHis workmates found out about this and

fired him from his job in the hospital. Hismother refused to have anything to dowith him. He was kicked out of his rented

Butto prevent transmission, itis clearly house and subsequent landlords threw

necessary to first admit the occurrence of him out after learning his case. Neighborssky behavior This is extremely difficult would come to stare at the so'called AIDS

forAsia, where censure and shame are part Family. At school, the oider son wasand parcel ofbeingA,sian. The region is in taunted by his schoolmates while teach'denial, crisis or no crisis. In the meantime, ers stood by in siiencethe virus spreads with impunity from They finally soughlshelter in a mosque,one person to another The situalion is which only grudglngly let them stay, notfurther complicaled by subcommu- allowingthem to roam the main hallways,nities within already marginalized com' sometimes even forcing them out in the

munities. HIV has especially thrived in rain on certajn religious holidayswhen lhethese subcommunities because lhey mosque was full. The portion of the car

are cutoffftom information. For example, pet they slept on would be sprayed withdrug users comprise the biggest high' disinfectant each morning and the younger

risk subcommunity in Malaysia, yet child would not berarely are they informed about the dan- allowed to play orgers of sharing needles. In facl, the little eat with the otherthey do know about AIDS merely reso' children. In the vil 'nate the prejudices of the general public lage, everybodythat is, AIDS is a disease of homosexuals knew about theand pfostitutes. As a result, the spread family and wouldof HIV among the Malaysian drug users even tell of thewas swift and now contributes lo mole news to totalthan 70 percent of the 23,000 reported strangers who

the encompassing consequences of itsarrival in the region. To illustrate, letme ( i te a care handled by rhe Malays ianAIDS Council last year

A man who wanted to donate bloodtested positive for the virus. He guicklyarranged for his wife and two children tobe tested as well and found that his wifeand their younger child were positive. Hiswi ie deter .orared qui (k lv and roon d 'Pd.leaving him to care for their two sons.

would stop by.T h a f ) r h p r : n

pl ied for housing

the department was concerned.The ex l reme c i rcumstance. faced by

this family finally forced us to take themfrom l l^p ' r v i l lage and Dr ing ther ro KualaLumpur where they got more support andbp rer l rea l -nent . But , car we be re\cL ingfamilies such as these all over lhe coun-f{?

l-rom rhi5 (ase, we !an \ee how ill pre'pared so many sectors of the commu'nity are to face the reality of AIDS. Thefamily, the workplace, the school, the placeof worshjp, and even the governmentwas unprepared for this situation. Nobodyhad enough knowledge on what do andtherefore reacted cruelly.

It is clear that in Malaysia, communityresponse to AIDS is min imal . L i t l lehas been done to encourage disc0urse, oreven just awareness, of AIDS. Rather,the lop-down approach, which is moregeneral and unfocused, has been favo-redwhile specific issues are not addressed.l n e j s s L e s o l 5 t i 8 - n a a n d d i ) c r i m i n ation are not only ignored but also exa-cerbated by advertising campaigns thattalk about "high risk groups." This is interpfeted by the general public as "groups

contact with whom would Put them ath i g h r i s k o f j n f e c t i o n " r a t h e r t h a n' ' i n o i v . d u a . s w h o s e l i f e s t y l e s p u t

cases in Malaysia.

The "Outcasts"The same is true with that other unac from the Welfare

knowledged subgroup: sex workers. Deparlnent, whichl f anyth ing, communi t ies are even t reated the o lderless willing to acknowledge the presence Hlv-negative son asof the sex industry than the occur- an orphan and at 'rence of il l icit drug use. Yet, sex workers tempted to takeare linked to the mainstream commu him away and placenity through their clients, and this two' him in an orphan-way route has contributed to HIV's age. Theywere notspread in to the mainst ream at an prepared to of feralarming rate. any assistance t0

In Malaysia, the impact of AIDS on the the father and thecommunity has not been given thorough sick child. They didth inKing be(ause (o lew have -Pal ized not ex isr as lar ds

22 lhe Asian Manager I SeptembeFoctober 1998

Malaysia AIDS Council Chairwoman Matina Mahathir:we ignorc the sprcad of the disease at out own pertl

tnem algeaterriskof becoming infected."The Malaysian AIDS Council has beenthinking very hard about community responses ro AIDS and believes suongly thardecision making and responsibjlity in themanagement 0t the epidemic in the coun,try lie flrmly wirhin communities at thegrassroots levels and not at governmentievels. The government at best must actas facilitators for this process.

To this end. we are developing an ideacalled Building Safe Communirles similarto an ISO srandard bur applies solely toa c0mmunit),'s readiness to deal with HIV,/AIDS. As an analogy, rhis idea can belikened ro the earthquake pfeparedness0fJapanese cltizens. EveryJapanese krowswhat ro do in the event of an earthquaKe,whetner one eVer strikes in their hfetime0f not. Likewise, every community shouldknow what to do ro prevent HIV from affec ng that community whether it actud lv d0e5 dppoat or rot . l t dped. knowingwhat to do can prevent HIV from ever alfecting the community and can therefore,un l i le "a r tnquake: . o l low Ine co11m Ln t ryto e"er , i . ,e a mpa\ure o 'con ro l orer inown 0esnny.

Ethics TestFu hermore, the ethical dim€nsions or

HIV,/AIDS has to reconcile wirh sociery sa I IUde owatd - ra-Aind, leo popu at ion, .which are the most vulnerable to infec-rion. It would be fait to say that becausesociety is unable to ignore the margjnalizedsectors of its population, its reac on naslargely been to neglect 0r punish thesesectors. Thus, although much has beensaid about the need to focus preventionwork on these groups, this often translatesinto attempts to isolale the infected lromInose wl'to are not and assigning blame tothe least empowered. For instance, bysimple prejudice, culpability is placed onthe lemale sex worker as vector of infec-lion, in the process absolvin€!rhe male client who iniected her in the first place.

Nowhere is ethics more sorely testedthan jn the area of the resting of peoplefor HIV While rhere is a need for surueillance of HIV incidence within the country to know the scope of the epidemic, rhisi s d o n p ' o . r h e p t r p o s " o f i d e ' t n i n gwhich sectors of the population are mostvulnerable and direc nglimited resourcesto whefe they are needed mosl.

In Malaysia, testing is considered a

A Council icon: Reaching out to the global community through universal images

means of prevendon. The idea is to identify those who are positive so others willknow who to avoid. This obsession wtrntesting is often explained as a way tolet people have access to t reatmenrp a r l J b u t \ i t h o L t r t r i ( t c o n l . 0 e n i a l . t y .Mosr people tested in Malays ia areelthef compelled to or are tested without their knowledge and with limiredcounseling. In the case of preemployment test ing for insurance purposes,bfeaches of conf ident ia i i ty is not uncommon and results in the person beingal together denied a job despi te bejnghealthy.

For those who do become infecred,it has been shown that no matter whoyou are before infection, you immediate-ty jo in the ranks of rhe marginal izedupon confirmadon of your positive status.This is why no Hlv.positive member ofmainstream society has ever owned upo h ' r or h"r sra 'u : . Inpy become as in .

visible as officially dlagnosed HIV,person,' h e i r p y i 5 r p n . e u ' a ( ( n o w l e d g p d .thejr righrs to treatment, employment,educat ion, legal ass is tance and evenshelter are as good as forfeited.

On the issue of treatment alone, enrcs

ate compromised when ac(e5s to co\ t .ydrL95 i5 denied. The la tesr d:scover ie .in AIDS treatment mean nothing to thepoor Even the professionallsm of doctorsis compromised when they are fotcedto either provide substandard tteatmenror non€ at all because of economic consideradons.

The argument has been made that merights of those vuinerable to HIV and thosealready HIV positive must be subsumed toprotect the rights of the communiry I findthis dubious and iil informed. There arealready 30 million infected individuals inthe worLd who are infected due to theneglect of their rights. i would argue thatwhen the community seeks to protect therights of the individual to obtain informa- 'oT on AlD5. to Dp p"ov ided (ounre l ng.Legal aid, employment, shelter and otherhuman dghts, the community does muchto protect its own well.being.

The decisions that we make now willmost definitely affect our future. We hopethat these decisions will be based on soundknowledge and understanding of AIDSand its impact, rather than merely on0 l e i u d i c P \ a n d d u b i o u s n o r a . t - 0 9 e .ments. I

&

September'October 1998 lhe Aslan Manaser 23

PASSINGtheAIDS TEST

Itb expensive, humiliating, and doesnt guarantee a iob.But if you want peace of mind, take it, take it!

I n parts of the world where even

I conrracept ives are beyond rhe

I reach of the maioriry HIV testingI comes on as yer another move of the

powerful minority to pry wider the dis'tance from starvation to salvation. If it's adeath sentence, why pay to find outyou'resick of something that has no cure? Andbecause life in these parts is little morethan subsistence roads to cross one day ata dme, charitable resources spent on in-formation Eampaigns are perceived as ar-rogant display of resource squandedng.Why spend on prevention for tomofrowwhen we'll all starve to death today?

ln the boomtown Asia of the '80s,

things looked a little less grim. While con'traceptives were no less expensive, therewete more practical reasons why oneneeded to practice safe sex and why anAIDS test was a teasonable option. Formanpower exporters like Malalsia. Thailand, Indonesia, PaKstan and the Philip-pines, AlDs'testing became an unwrittenmandate for anyone about to cross inter'national labor borders. Three psychologi-cal processes helped make the decision totest become something of a routine in theregion. One, I know I don't have the vi'rus, but to be comperidve in the interna-tional labor market I need that test resultstamped negative and initialed. Two, if Ihave it it's best for me and my family if Ifind out now, while I'm still healthy

enough to recognize my oplons. Three,If I have it I'd be better off away ftom theshame and rejection of my family andcountry. I might even get better teatmentin a counuy with more money.

Weird PremisesAll three went through my mind when

I first got myself tested in 1991. I was ap-plylng for a Saudi iob in a big agencysome'where in Ermita. In a corner of the appli-cation form, to the right of a yes and nobox, was the question Have you ever beentested for AIDS? You know, like Have youever been convicted of a crime? which wasasked on the preceding page. As with longforms requiring signatures, this one closedwith the standard, italicized I swear to thebest of my knowledge and ability that allpreceding information are..etc. You knowthe drill. I checked No. After that cameAre you willing to have an AIDS test vol-untadly? Cudously but not surpdsingly, acolon note said that negative test resultsdid not guarantee a job, and while resultswere kept confldential, I was to pay for itin cash, full amount, on the dayolthe test.Standard medical tests for old quarattinediseases were a separate package andwould only be required il I made it to thefourth and final interview.

I didn't. The test was negative, but onthe thid inteMew the man asked if I couldraise Pl0,000 as initial placement fee so I

could be "prio tized" in the list, given mydazzling writing talents and the pinknessof my health. I told him I was confused. Iapplied for the job so I could make thekind of money he was talking about andnow I'm stuck in a Catch-22 monetaryblackhole. He said salary deduction is thenormal option here but he was ahaid ev-ery applicant and his brother had optedfor that rack and the waitjng list is fromdown rhere up to here, indicaingan imagi'nary watermark on his forehead. I see, Isaid, disappointed but not drowled. So,apologetic but routinely officious, he bademe good day and happy job hunting. Allin all, bus and jeepney fare and xerox andfolder and ball pen and Scott burger andcoke and time and HIV test, I thinned outmy personal savings by P1,300. Nine hun-dred and fifty for the test.

But it wasn't a total waste, of course.At least now I know given the best of testsavailable and a voluminous past I have iustbegan to.document, that I don't haveAIDS. Itwas both a great reliefand a trainrobbery I wasn't going to die, but I didn'tget the job I shelled out good money foreither. Where did that leave me and whatlessons can I lmpart to fellow wage earn-ers of the world?

A party animal from 1978 to 19S0, Iwas one of those whose consciousness ofdeadly dsks in public relations was severelyclouded because ofa unique period in his-

24 The Asian Manager I Septembeloctober 1998

tory, brought to me live by accident ofbirth. From 1983 when Ninoy was shotto 1986 when Cory became president, themedia-and therefore perception-was forall practical purposes devoted to nothingelse. Offhand I cannot recall anything ofcomparable focus and devotion fiom themedia of the time. Even Cory's term wasa chaos of coups and skirmishes to repaira damaged democracy in this part of theworld. A continuation, really, of Ninoy.Then an earthquake. In other words, forall its reasonable, long-term, media-pro-pel1ed obiectives for the good of all, AIDSinformation campaign in rhe Phi l ippinesbetween 1983 and 1990 didn't have aghost of a chance.

In the meantime, AIDS infection andbody count peaked elsewhere in theworld. A risk group subslded on the casu-alty graph, a new one is identified. A vo1cano erupted in our backyard? Why not?And after the mudflows were held backfor a day and the ash cleared from the roadsand alleys of our everyday economic reali-t ies, we resumed disparching our broth-ers and sisters across the sea so they couldsend us the dollar that kept the under-ground economy alive and the visible oneafloat.

No excuse, of course, for playing a dangerous game for so long. But I had thebetter sense to quit while I was ahead. Byp u r e c o i n c i d e n c e . w h i l e r u m m a g i n gthrough the rubble of rhe eanhquake, Ifound my old redbook in which I kept ascore board of my achievements in thefield of public relations. A ray of light ema-nated fiom the sky and guided me towarda tally. Not bad for a party animal of slen-der means, a voice with reverb said. Nowget off that game and be gainfully employed. Declaring myself a respectablewinner, I threw in the towel and pickedup The EightFold Path to Enlightenment.But just to be doubly sure and as a fare-well gesture, I had another test in 1994.A like minded fiiend who had arrived at asimilar crossroad the year before asked meto accompanyhim to Makati Medical Center. He dreaded going anywhere to takean AIDS test alone. If I like I could takeanother one. On Him. I said, sure, whynoI.

Unlike the Saudi job testwhere I formeda line with dozens of men with dead endlooks in an ad hoc backroom in a con-gested employment agency, Makati Med

has parklng. This is more civilized, I saidto my fiiend, who couldn't te1l becausethis was his first test. He was going to theUnited States to get his PhD. Anotherfriend had given him the number andmade the appointment, for two. Sevenhundred and fifty pesos each, results inone week.

Dreadful TestLlke the Saudione, there's no billboard

size notlce with an arrow that said ,,AIDS

TEST THIS WAY'' at the Makati Med. Butdifferences soon emerged. In the agencyeveryone in the line held the same formand faced the same vampire at the fionthoarding blood samples. Jokes that re-quired little content analysis can and werecracked among the voluntary victims. InMakati Med there was no line. But whenwe asked the smiling woman at the deskfor directions, the smile vanished like aphantom, her face draining, visibly, ofblood. Hello. She dropped her eyes andsaid "fourrh floor to the righr" and wenrback to the wonderful task she was tend-ing to before Jeckyll and Hyde interruptedher. I don't remember which was worse,courtesy refused categorically or the effortit rook nor to begrudge a bigor rhe benefitof the doubt. What I remember was thespreading heat all over my face, ears, andthe back of my neck. You could be thePope and I could be Mothei Teresa and

For manpower

exporters like

Malaysia, Thailand,Indonesia, Pakistanand the Philippines,

AIDS-testing becamean unwritten mandatefor anyone about tocross international

labor borders

I'd still feel like a leper, i said to my friendin the elevator. He was scarlet to the rootsof his hair. When we got there, a girl inwhite lab fiock met us with a smile widerthan ours. Upon hearing the words AIDStest, the smile disappeared, too, but thistime a comprehending, metronomic nodslid in its place. Followed by a nice, al-most baby-talking "For a while, ha?" Shethen disappeared behind a curtain blind.We didn't mean to eavesdrop, but underthe circumstances, what couid have pos-sibly stopped us? She was talking to some-one in a hushed, p inched vo ice ,grovelling."Pleaseeee, you do it! "

Prices applicable to all Iadminister HIV test,

YEAR

199119941998

f '

PRICE

P 950P 750P 450

WAIT-RESULTS

14 working days7 working days4 working days

t ions in

t

Septembef-October 1998 | The Asian Manaper 25

A young man in similar lab fiockemerged, followed by the gitl. We wereal l of the same age, i t seemed, but theboundary dissolution that usually happened when people of an age were thrownin proximity dld not. Just the opposite. Likea flight attendant doing pre-flight calisthenics wlth life-support things and brochures,he started to rattle about the pr.ocess ofHIV testing, Elisa and Western blot andall that, beglnning with forms to f111 out,which the gir l magical ly produced andhanded out to us. The first obvlous con-clusion, and therefore the first reason notto be iffitated, was: these are two bloodchemrstry 1ab techs who don't get manyrequests for HIVtesting. In all likellhoodwe were the first males their age and com-parable education to ask for the test' Asfor the girl, we1l, she probably took onelook at a sample that returned positive ayear ago and she's had nightmares eversince. She told us to take the forms to thewindow on the hall to the left and comeback for the sampling. A typeset enumera-tlon 0f standard pre-AIDS blood chemis-try tests were itemized on the form. onthe "Others" blank she had scribbled HIV.The woman at the window took a look atit, scribbled P750.00 on the price column,counted the money and punched lt in theregister, stamped and initialed the forms,kept a copy each for file, ripped the tlckertape and stapled them to our copy and

handed the pile back to us through thehole without a teeny-weeny glance. Offwe went back to the lab, the halrs on ournecks singed with speechless alienation.

Longest DaysThey were both wearinglatex gloves.

Annoyed beyond stress management, Ivol-unteered flrst. As in the agency set up' atray of empty test tubes with its own dis-posable needle stood by ready on the tab1e.My fiiend looked on as if an unanesthe-tized surgery was about to be performed.The girl looked at my fiiend, recognizedthe fear and looked at me. I rolled up mysleeve, the male tech tied a rubber tublngaround my arm above the elbow andslapped out a vein twice. Ouiet and so1-emn, the insertion of the needle sum-moned up further images of illicitness andcriminalify. it was difficult to understandeven the second time around why theyrequired so much bf it-a test tube full-for iust one test about a tiny organism thatwas supposed to multiply by the milllonsa day. I temember that blood-typing andRBC count only required a couple of pin-prick drops from a finger tip. "Why do yourequire so much if there's a million of themin a cubic centimeter?" Obviously, his spielabout the test a while ago dldn't register.It's not the organlsm we're looking for, hesald without looking up, but your body'sreactlon to it. Thev reproduce faster than

I rolled up my sleeve,

the med tech tied a

rubber tubing around

my arm above the

elbow and slapPed out

a vein twice. Ouiet and

solemn, the insertion

of the needle

summoned images

of illicitness and

criminality

the immune system can produce antibodies, so there are fewer antibody particlesper cc. And since it's the immune systemitself they attack, the fight is very unevenfiom the start, although sample test vo1-ume remalns the same for all stages.

We11, thank you for this fiightening lnformation, I said to myself. I feel empow-ered knowing the extent of my powerless-ness. Yeats latet I read some new devel-opments that suggested his expianationwas slightly off the mark, but ln a researchfield fiaught wlth the shortcomlngs of in-fancy, even the chief field resident couldn'thave made me feel less defeated. Inanycase, the tenslon dissipated enough forme to crack a joke about the

'Q0s beingdrought season for Dracula, when it wasmy fiiend's turn. When it was all over, ourtwo young dynamic medlcal technologtstsreiterated that test results wlll be availableln seven working days, and ended with Ifit's positive, we'11 callyou immediately forcounseliing. If it's negative you can pick

up the test result in Person.That week was the longest in my life.

My fiiend's, too. Everytime the phone rangmy life flashed before my eyes, he sald.Finaliy, at 10 am on the seventh day hecalled up, screaming "Negative!, negative!We don't have AIDSI WE'RE ALIVE!"

The next day I gave uP all mY worldlYpossessions, shaved my head, and loinedthe monastic order of Enlightened Celibacy. Just so I don't have to take an AIDS

Iwaiting for test results: "Every time the phone rang my life flashed before my eyes

26 The Asian Manager I SeptemberOctober 1998

test ever again.

lIM PNOFESON$of{

TUN ISMAIL MOHAMED ALIOne had in-

vadably hearda l o t a b o u tTun Ismail be-fore he or shem e t h i m -how TunIsmai l was a"man ofinteg-r i ty" and

such. When I met him this reputa,tion was confirmed. In the brief en-counters I had with him, he struckme as a no-nonsense, professional,straight-talking leader-manager. Hegoes straight to what he wants to talkabout and you know that he's verysedous about his joU ,And with get.ti4& qlingt'dondf He exudeN leadership aild you'll know that the niomentyou meet him.-Dr. Jesus G. Gallegos Jr.San Miguel Corporation Professor inInt&national Enterprise Der/elop-ment, Dean and Chief Operating

Tun Ismail had a reputation for being toughwith his people. I remember back in 1978someone told me to "watch out for Tunlsmail-he'd bite your head off." Then I hadto deal with him because I was in charge oflooking after the board ofgovernors for a con-ference. I found, to my surprise, that he wasactually one of the easiest among the gover-nors to take care of because he didn't like toimpose, never asked for anything other thanwhat he knew AIM was going to do for him.He never put you out of your way. In fact, I thought hewas such a gentle pe$on I found those stories about hima little hard to believe. That one about Tun,being somekind of fire-Sbathing dragon was a gas.

Another anei$ote about Tun was relayed to me by DatuJaffar, Tun Ismail's successor at Bank Negara, Malaysia.'Ihey were traveling from Kuala Lumpur all the way toBoston. Now' Tun lsmail did not want to check his lug-gage all the way through to Boston. He wanted to offloadhis luggage at every stop so he can check his bag, to makesure it didn't get lost. On the other hand, Datu Jaffar de-cided: "l am llot going to waste all that time, I will justchecl$my luggage all the way through." So, every stopthey had, Tun lsmail would get off the plane, retrieve his

I have met manyMalays ians whohave worked withT u n I s m a i l a n dthey all say that hewas a terror towork with becausehe was so straight,intolerant of care'l e s s n e s s , s l o p p i -ness, and unpreparedness. He alwaysexpected a high level ofprofessionalismbecause he lived and worked it everyday. People around him eventually hadto follow his example because he set thetone for doing things. I think he is verycharmingl he never struck me as a fear-some personality. But if you worked witbhim, you'd better be professional oryouwill be in trouble.-Prof. Jose FaustinoGoodyear Tire and Rubber CompanyProfessor of Business Managemenl Pro- 'gram Director ofthe Marketing Sbateg/Course

luggage and check it back in for the next legof the night. Now, what do you think hap-pened? They finally get to Boston, DatuJaffar'sluggage comes out and Tun Ismail's luggage ismissing from at the last stop. Despite every-thing that's been said about him, I knew twothings: he was a very gentle man, and he wasa man of integrity.

I spent a lot of time in Malaysia in the 1980s.doing consultancy work. I met a lot of Malay-sian businessmen, managers, and ordinary

people during the time, and everyone knew Tun Ismail.Every Malaysian living today knows Tun Ismail. I neverheard anyone even hint at any wrongdoing. Wheneveryouask aboutTun Ismail and talk about Tun Ismail, whatwouldalways come out was that he was a very honest man. AndI suppose everyone should want to be remembered that

The fact that he never imposed anything was already asign that this was a person who tended to look after oth-ers before he looked after himself. We'll miss him: hewas always good to AIM.-Prof. Horacio Borromeo Jr.USIPHIL Prolessof of Business ManagementAssociate Dean for MBM

Di Jesus Gallegos

,..*

Prof. Horacio Borromeo Jr.

Proi Francisco Bemardo Jr.

I remember visiting him in Malaysia,with Professors Fil Alfonso and MelSalazar . Mel, I think, was dean of fac'ulty. And we didn't know therc was a ses-sion in Parliament and it was on budgetand finance and he was being pressuredand all that. And so, when we eventuallygot to see him, he kind of blurted: "What

do you want?" We iust told him that wewere just there to pay him courtesy call.After a minute or two he reallzed the elfect of what he said. We were on our wayout when he called us back in, and weended up spending close to an hour of avery nice discussion. He explained he wasundef some pressure and all that. Thething is, he's really a very nice person. Hehas a reputalon for having a temper, buthe's sreadfast in what he thinks and he isvery perceptive. He's a very principledman.

He said he I'ked what AIM was doingwith the middle managers, midway intheir careers who cannot afford the tvvoyea$, but for whom two months is toosnoft.

Credit for the MM, and he liked whatAIM is doing, and he said, what do we dowith the middle managers upway in thecareer who cannot affold the fwo yearsbut the two months is too short. And he'sprobably thinking of Malaysians becausehe was talking about Asians as well.

That's why the faculty had to design theMM course, which is not a shorter ver-sion of the MBM. Thatb how it got started.The faculty took at least foul years to de'sign that.

-Prof. Francisco P. Bemardo Jr.Caltex ProJessor oJ BusinessManagementFormer Dean of the Institute

2a The Asian Managet I September'October 1998

ISMAIL:A Life of Integrity

The Asian Manager repf,nts afticles and photos fron the August 9, 1998 issue ofMalaysiat New SundayTtmes, which carried a tibute to the well-loved Bank NegaQ governot and AIM governot These afticles arc:"lsnail: A Life of lntegity,' 'Fondly Renembercd,' 'The Pincipled Life," and "Tun and the lrcn Ladv"

"Only crooks and thieves fear me," the late Tun Ismail Mohamed A1ionce said rather matter-of-factly when asked about his notoriously highstandards as the first Malaysian Governor of Bank Negara.

Not only crooks and thieves,actually, but, as the joke goes,even the dnggit was so afiald ofhim, it never fell.

His younger brother, DatukJaffar, had a friend who used tocompla in: "Your brother isstraight as a railway line."

Ismai l ran PermodalanNasional Bhd of which he waschairman for 19 years, prettymuch the same way - so muchso that there was nevet even abreath of scandal associatedwith this influential Bumiputerainvestment body. Thus, whenIsmail died at the age of 79 onJuiy 9, it was this side of his chu- .acter-his unwavering adher-ence to ethics like integrity, hardwork, discipline and thrift-thatdefined the obituades carded inalmost every newspaper in Ma-lalsia. What was known of the private lifeof tlis Cambridge-educated gentleman in'dicated that it was not very different ftomthe way he conducted his business-pru'dent, resolute and free of hanky-panky.

A Mellow SideBut, he was said to have mellowed

somewhat in his last decade, especiallyafter becoming a grandfather. Somehow,his five grandchildren brought out the softside of him and he doLed on them, espe'cially the first-born, Kazimir

His seven surviving brothers and sisterslearned of this soft spot ofhis. Thus, whenhe called Jaffar one day to ask him to helphim buy a piano, Jaffar immediatelyjumped to the conclusion that it was for

lntegtity, hard-work, discipline and thriftdefined the man behind the mirccle

lsmail's grandson. Says Jaffar who is ableto mimic his elder brother's gruff tone to aT "He said to me: 'Who said it's Ior mygrandson? It's for me, you know!"'

Jaffar, who never quite believed that lifeshould be lived "suaight as a railway line",was pleased with his brother's new incli'nat ion and broughr h im Lo a shop inSubang Jaya where he managed to per'suade Ismail away from a cheap model aldbuy a better but more expensive one

It's not known whether Ismail did leamto tickle those ivory keys but he definitelyhad a penchant for classical music, goodcigars and leather-bound flrst editions.

Some said his tendency was more to-ward dour expressions and baleful glares.He was known to walk past people with

out any sort of acknowledgement, his headheld upright, his steps soft and even. Thiswell-know facet of him had a most dis-arming effect on those he met. "lt was asthough he was deep in thought... a verypreoccupied sort oflook," says a business-man who has had the experience of smil-ing broadly at Ismail only to get a blanklook in return. Even at social functions,he was unlikely to speak too much 0r makehimself sociable. Often, he sat silentthrough an evening surrounded by achattering crowd. Ismail was basically amar of exacr and formal manners. fhe erp.garious Saleha, on the other hand,enjoyed looking all about her atfunctions. "'Don't be rude', hewould say to me." But, she oncehad a good laugh out ofthis mindyour-own business habit of his.She had arrived at his PNB officeto see him and was shown by thestaffto his pdvate lift. Tun walkedinto the lift seconds later andstood there stiffly, looking neitherleft nor right. The lift stopped, hegot out. Saleha followed behindand this went on until he reachedhis secretary May's desk where hetold her that when his sisterarrived, to show her in. A ratherconfused May pointed out thatSaleha was aheady there, right behindhim. And, when Saleha said she had beenby him since getting into rhe lift, the icyexterior finally cracked. "ltwas one ofthefew times I saw him laugh like that," saysSaleha.

The Famous CharmThis was definitely a side of Ismaii very

few had glimpsed apart ftom family andclose friends. Nevertheless, his door, par-ticularly after he left Bank Negara, wasalways open to his brothers and sisters,as First Lady Datin Sefi Dr Siti Hasmahrecalled during an interview severalmontis ago. "He likes us to go see himto talk, for advice," Siti Hasmah had said.But, adds Saleha: "You had to make anappointment and you'd bettef not tobe late or too early." Beneath the stiffard stern demeanour also lay an almostinstinctive courtesy or, chivalry as theyused to say in the old world. When.ever any of his sisters visited, he would

personally escort them from the carinto the house. The same applied whenseeing them off. "Oh yes, he could be verycharmingwith the ladies," says Lin. Whenthey were alive, Ismail and Maimunahoccasionally met up with Lin and DatukSeri Dr Ling Liong Sik and their wives formeals and, Lin recalls, Ismail wouid standup each time the ladies got up from thelable. 'There wasa loro ik indnessin h im, 'says the younger of his two sons, Kamal,44, a Melbourne- t ra ined archi recrwho now runs his own firm.

However, both Kamal and his brotherIskandar insist thatthei r fa ther gave

mem great values."From veryyoung,we were told:

for me instead." Says Kamal: "l didn'teven own a radio in coilege. He put mein a good college with accommodationand food. I worked as a waiter for theextras. Lookjng back, it helped pur thingsin perspective." What he taught his chifdren he also drummed home to "pro-

teges" he d iscovered in h is yearsat PNB. As PNB chair-man, Ismail oftenhand-picked qual i f ied Malays to s i tas directo$ on key publiclisted compa,nies. Sharizat won his approval to suchan extent that he recommended heras chairman of two top KLSE companies.They had at tended the same socia lfunctions and Sharizat, who had long

admired Ismail, saw him sittingalone. Gathering her courage, shewent overand sat down. After a few mo-ments she greeted h im wi th

salam and introduced herself."l'm afiaid I spoke more than hedid," she recalls.

Role ModelTwo weeks later, someone

from PNB called for her CV and,a month later, she was offereddirectorships at two top compa-nies. She was flabbergasted and,when she later called on Ismail,he told her that he thought shewas very brave. Courage was tJleleast of his considerations. lt isprobable ihe would have cut noice with him had she not beeninte l l igent and h ighly qua,lified. Ismail will always remaina role model for her. "He wastruly ahead of his time. Howmany men would have consid-

stand on your own feet, don't depend on ered a young woman to head a publiclistedme or family connections, don't live company and, I know, he gave similar op.beyond your means. Yes, we were very portunities to other men and women."comfortable but dont expect him to get Many thought it ironic that he openedyou a sports car or anything like that," doors forso many capable Bumiputerabutsays Iskander, 48, who tuns an invest- was as unbending about not hel,ment outfit. The family, they recall, did pinghis own relatives. He expected themnot get a colour ry till well after every to seek help elsewhere and, as a result,one else had one. One bifihday, when still was often accused of treating strangersa boy, Kamal planned to buy something better than his own flesh and blood.special with money he had saved fiom In retrospect, that aspect of his life washis allowance-the way his father perhaps the toughest test of his unhad trained him. "My father was very erring sense of integriry And he passed itpleased to know that and bought it with flying colors. I

Septemberoctober 1998 The Asian Managet 29

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As far as Tun Ismail was concerned, there wereabout right or wrong - only one. For

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I s m a i l w a s o n h o l i d a y a r[ ] rase r ' s H i l l w i th h i s w i fe 'a n d a s t h e y s t r o l l e d p a s tt h e b r a n c h o f a w e I lknown ban l ( . he no t i ced anInd ian woman on the s tepso u t s i d e , p e e r i n g i n t o h e rban l< boo l< . He app roachedher and as l<ed wha t waswrong . I he woman s ban l (b o o l < s h o w e d a p e n s l o nw r t h d r a w a l o f R M T l b u ts h e h a d r e c e i v e d o n l yR l r 4 1 7 . H e i m m e d i a t e l ywen t i n and asked fo r t hemar iage r . ' l ' he c le r l ( d id no trecogn tze h im and t r i ed tob rush h im o fT . Even tua l l y ,t he manager emerged , recogn ized the Bank NegaraGoverno r . t u rned pa le andgo t an ea r fu l . By I sma i l .

Da tu k Paduka Sa le h a ' saccoun t : "My b ro th e r t o ldh i m t h a t b r a n c h e s l i k et h e s e a r e s u p p o s e d t oJe rve the sma l l peop le solheV have to ma l<e the extrai ef fort- My poor srsterr n ' l a w s a i d h e w a s s o u pse t he was In bad mood therest of the day." They ret u r n e d t o K u a l a L u m p u rthe nex f day - Then , i t wasthe ban l< manager ' s t u rn o fto ge t an ea r fu l f r om the( r O V P f h O f .

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H a s h i m M o h d A l i :" W h e n l r e t u r n e df rom Eng land , I as l (ec lh i m t o s t a n d g u a r a ntee for a loan I want( ' ( lf r om a ban l< . He no ton l y sa rd no bu t t o l i jme tha t as ( l ove rno ro f B a n l < N e g a r a , h t ,s e n t h i s b a n l ( s t a t € 'm e n t s t o

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S i e w S i n l r h e n l i rnance N4 in iste r l eve rrm o n t h . S i e w S r nw o u l d i n r t r a l i t a n c ls e n d i t b a c i { . T h a t sw h a t h e w a s l i l < e . '

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. r r i e r .d fh , r t r he cake be. ( n ! bac l ( . l - oss o f f ace ,, , ! r r i i no \ ^ / , i t I sen t i t bac l ( .: r ' . r v h a r d i C I d o ? |; i r aped h i s name o f f t heia l i e . an t l . on Raya day ..hP fP r ve re two b ig ca l<esi n o u r h o u s e . W h e n I s m a i l. a m e . h e a s l < e d : ' H o w! 0 m ( ' f w o o t t n e s a m el t r n d l I s t h i s t h e c a l < e I. r s i < t ' c l vou ro re tu rn? 'Me .! l i t ed rnnocen t .

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Ever strcight: With P me Ministdr Mahathir and Dr. Lin (left)

AN Sri Dato Dr. Lin See Yan andTunlsmail Ali go back a long wayand he was certain he would beasked the question: What is Tun

Ismail really like? So he dug through hispapers and found the speech that Ismailhad personally written and delivered atBank Negara's 10'h Anniversary Com-

memorative Dinner on January26, I 969."There are so many things to be said

about Tun Ismail but it will always comeback to these basic pdnciples outlined inhis speech," says Lin. Below is the pelti-nent segment: '....My chief role and re-sponsibility, as head of the Central Bankin these early years of its existence, is to

attempt to build up a body of traditions inthe Bank: a tradition of absolute integity,a ffadition of competency at the highestpossible level in its organization, a tradi-tjon of continual and dependable exper-tise in economic alfairs generally and inmonetary matters, particularly and aboveall, a tradition of being able readily torecognize and accept absolutely the dic-tates of the national interests, as againstthe interesls of fre individual or particu-Iar groups either within or outside theBank.

"ln the final anal)6is, the respect andinfluence that Bank Negara has on thepublic in general, on the commercialbanks and on the economic and financialpolicies ofthe Government itself, dependson these virtues and standards that theBank is able to develop and maintain."l

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Tu[l"no theIRONLADYTun Ismail had many admirers, but one

person whom he marvelled at was DatukMaznah Hamid, tlle successful business.woman often klown as the "lron Lady."

Ismail and his family got along fa.mously with Maznah's during the eightyea$ or so that the two clans knew eachother Ouite incredibly, this well-knownlady had little idea oI who or what lsmailwas prior to their meeting at a PermodalanNasional Bhd (PNBJ conference in 1991.In fact, for the first 10 minutes of the ac.quaintance, she had 'Encik Ismail ed'himthroughout the conversation until sheheard a waiter address him as "Tun'.

Bur lsmail had been following hercareer for several years with great inter-est. He was impressed with the progressof her security service company, her Wand radio talkshows, her motivation seminars and tapes and, of course, her WomanEntrepreneur of the year Award.

Thus, he tried his damest to get her onthe board of Perbadanan UsahawanNasional Bhd (PUNB), a PNB arm set upto develop Bumiputera in the business.

I t took some persuading becauseMaznah, who was already well-establishedin her business, was simplyswamped withwork and appointments.

She remembers telling him: "No timeTun, I already work 16 hours a day."

She is gatetul today that he changedher mind. "l thought I knew about business but Tun introduced me to a more in-

tellectually challenging side of the corpo,rate world that I never knew."

Bur rhat didn't mean she did everythinghe said. She argued with hirn on the PUNBboard, sometimes forhours, about whichcandidate qualifiedfor PUNB funds.

"Tun was very par-ticular lt's not onlythe qualifications thatmatters... the candi-date must look tidy,too. He did not likeone mall wno wole athick gold chain. Hethought such thingswere a bit vulgar fora man of a cenain so-c ia l s tat ion. Ano-ther met some resis,tance because Tuncompla ined theman's tie was ctoo-ked. A small off'the-mark detail like thatgets h im dera i ledabout the clarity ofyour intentions. Andhe wanted to knowhow many cars andhow many wives youhave. Aiyoh!"

"Very susa,4 to get

money fiom him. But, that's Tun. He usedto say: 'lt's the people's money, you can.not spend it simply like that."

Many believe that Ismail's respect forMaznah stemmed ftom the fact that shewas a sel f .made woman who ran abusiness free of hanky'panlry. More impor,tantly, she never asked for favors from him.

In terms ol personalify Tun and Maznahseemed.as differenr as day.and nighr -r u n w l l n n l s t m p e c c a D t e m a n n e r sand controlled speech; Maznah withher spontaneity and lively kampungstylecongenlaxry

For instance, the first time she arrivedat his PNB office to see him, she wasshocked to see him waiting for her out-side and even more shocked when hestepped forward to open her car door be-fore escorting her up to his offlce."Al1 the time I knew him, he wouldtalk, talk, talk about things like honesty,sincerity, no hl?ocrisy, telling the truth,never sweep things under the carpet, stayc lean. - - "

Maznah joined his family in keepinghim company when he was hospitalizedand insists a little tearfully:"We have iost a good man, full ofwisdom, who left unfulfilled dreams forthe nation." I

The gentleman with Maznah (center) and Maimuna

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September-October 1998 The Asian Managet 33

SMAI t

Tun Isnailwas aLsa known as afanily nanwho had set the sane impeccable standatdsat work and at home. Fa[towing is a rccollection of Tun Ismails selJ canfessed "prodigal

soq," lskdndat 15qait, who put the memoric,togethet withTanSriDato' Dr. Lin See-Yan,CEA of Pacific Bank Bethad and AIMGovenor

Integrity formed the cornerstone of effective management for Tun lsmail. Heused to say that integrity isauniversalvalue itknowsno boundaries; while valued in Malaysia and Asia, itis not just a Malaysian or anAsian value; it is as Ameri-can or European or Afticanas it is Asian or Malaysian.Without it, managemenlanyr,vhere cannot be effective or effiCient. In practice,Tun regarded integrity as anecessary but not sufficientcondition for good manage-ment - a value which all good managersthe world over should, and indeed must,have and promote in order to get a jobdone weil.

Ideas in good managemenl, no matterhow soundly based intellectually, havel i , r l a m a r i r I r h o v r r o. . , , r l o , r . r w ' , ( q u r y

implementable. Tun c0nsidered great ideasas practical ideas. He had always believedin practical management not starlc man-agement but dynamic management sub-ject to constant change, something like"management in mot ion" . Once con-vinced that an idea can work, Tun wouldspare no elfort" n ser-inp . .mplementedpromptly, effectively and elegantly. Tunused to say: do not waste my time on anidea when you cannot put i t on thegound, and get it to work.

wffiBy Iskandar Ismail SMAI T

To realize these ideals he promoted andvalued people he recruited the best andensured they were properly trained andretrained technically, and created a moralenvironment in which these virtues wouldflourish and where senior and peer pres-sure would bring about the required high

fort and money in ensuring tiat trainerscomplied solid case studies as an effectiveteachingtooi. Reflectinghis down-to-earthapproach to management, Tun believedthat practical oriented training should in-corpora le re levant in ternat ional exper i -ences.

As children we may have missed himwhile we were $owing up. I suppose thatwas a price he had to pay for being totallycommitted to his work. But having mylate mother there full time made up formuch of his absence. She was a fiiendas well. He was a good father, althoughhe appeared to be very distant to us aschildren. I thlnk that I began to really ap'preciate his role when I became a fathermyself and had to raise my own children.

My father and I became very closeafter my mother passed away, as friends

than anything e1se. It was a pity,really. My mother would haveabsolutely enioyed seeing us likelhat, especially since Iwas theprodigal son when I was younger

But I suppose itwas just as welthat he had set very high standards of integrity and professionalcompetency for h jmself andexpected no less from us his family. His were very big shoes tofill. The challenge was whether Iwas prepared to live by thosestandards. I think my professionalcareer is a good reflection of howsuccessful both he and my latemother were in instili ing thosevatues ln me.

He had always said there's nostandards. Mosl ofall, he believed in management by example since this vision wasa way of iife for Tun.

Tun insisted that all managers be man'agement literate. Although he believedthat good management js really simplecommon sense, he nevertheless promotedmanagement education by ensuring thatorganizations in which he led set asidesufficient funds for such education, includinga formal Siaff Training Center with thehighest standard of teaching and research.He in5isted rhat managers be rrained bvexperts (local and foreign) with wide ex-perience in good management. Equallyimportant, he insisted that training shouldreflect a pood balance of academic excellence as wellas pragmatic experiences. Heber ieved in cabe srJdies and spared no e l

easy way to the top, except by sheer per'5evp-ance. Nevel compromise your val-ues. And though I think this is not an easypath to take, especially when conventionalwisdom of the time follows a differentroute, once you internalized these valuesyou wi l l f ind thei r appl icat ionusoful in olier facers of your li le. especially ln times ofeconomic or personal ad'versity. It is an honorable code to liveby and a good example to pass downto your subordinates as weli as your chil'dren.

Besides the sacrifices that had to bemade with regard to my father's family,it was also a lonely position for him amonghjs peers. However, his single-minded'ness in maintaining his standards eventually made him the standard. I

Family man: With wife and sons lskander (left) and Kamal

34 The Asian Manaper SeDtemberoctober 1998

A Publication of the Federation of Asian Institute

l-of Manageme

INKAntAlumni Associat ions Inc. Vol . V l l l No.3 September 1998

Philippine ExecutivesDonate FVR Research Chair to AIM

With Mr. Ramos are other Chair donors (seated, fiorn left to right) Antonio O. Cojuangco, Roberto R. Rornulo (reprcsenting Dr.Stephen Zuell ig), Rizal ino Navaro, Washington SyCip. Jose L. C--uisia, Jr., Ciel i to Habito and Maria F lordcl is F. Aguenza (repr-esentingAmbassador Jesus P. Tarnbunting). Standing are Jose T. Quimson, Octavio V Espir i tu, Salvaclor Tirona (represcnting Jose Ch.Alvarez), Raul Anthony Concepcion (representing Raul T. Concepcion). Juan B. Santos, Tomas I. Alcantara, Jose Ibazeta (t-epresentingEnrique Razon Jr.), Carlos R. Al indada, Arsenio M. Bartolome t l l (TMP'86). Alberto Manlapit Jr. (represcnting Arrdres Soriano II I) ,and Benigno N. Ricafort.

LezLclcrs of tl-re l,hilippinc ltr,niness comrlunity lronrtreclfomrcr Presiclcnt F'iclel \l Ranros. cLrlrlrccl the "CEO ofthe Philippines 2000 Enterpdse." by lar-rnching thc Ficlel\{ Rarnos Rcscrch Chail in lblicy Studics ckrnated t<rAIN{ onjlrne 25 at the ACCEED Confi:rence Cenrer.Scvcnteen execLrtives lecl by N.'Icssrs. Rolnto R. Rrxnr_rhrand Rizrlino S. Navanrr, chuirrrren of Philippine L()ngDistance Telephone (PLI)T) ancl the l Io l rse ofInvestrnenls (Hl), respectively, collectively raiseci a seeclclonation rf lrhl, l0 millkrn to stult-up rar.ior_n Cluiractivities that u,ill lr ruanagecl by the Wa.shington SyCipPoiicy Fonun. With Ntr Rrururs having an advisory rrlein all Cllrair activities, the Policy Fotutr u,ill lr condllctinllrcsearch, (()nfilrences arrcl othcr activitics of interest thatMr'. Rrnxrs intencls to pllrsuc. Srxtre rf these activitiesinvolve thc prel-r:uation of sftatcgic policy clirectirx-ts or

1r r l i r ' ) l rc( r ) l l ln tcn( l t t l i ( )ns ( )n l l )J i ( ) r c( ' ( )n( ) l l ) i ( . lu ' ( ' l l \affbcting I'hilippinc crxllpetitiveness sllch as infrustntctLrc,.sr-rbregional e('()nontic aftrrlgcntent.s ancl infitnnationtechnriogy; the rcvierv cf exi.stit-rg or prrprisecl grlicydirections on thc al>ove-nrcr.rtionecl areasl ancl theorganization of f irra ancl worksh()ps alu()ng p<tlicy

sLrkcJxrlclers to clicit feeclltack, kr clcvelolt conscnslnancl aclv<rac1'on the proposals.

As Nlr. Ran'ros acknowleclgcd the tributc fi:tecl hinr, hesaici that thc Chair's csrrltlishrnent g()es byoncl perxrnalrecogr-riti<tn. "ILs transcenclcnt nrelning is to eflirnt thejdea that national succes.s in rtur tirtre clepencLs on thep()wer of analysis ancl clear thinking. It reninds L$ thatinstitlrtions of lerrning, tltink tanks ancl policl' sturclycenters nrtfter gretrtl)' in the illrkimg <if a better |ulti(xtancl u L-tter \lorlc[. Fiu'n< I evcrything Ls lxrlitics. I)rrltlerrrslrlLlst l)e carcfirlly analy'zecl so that \\,e can rulive atef'fective solllti(xt. Policies lltLlst l)c tltc pr<rfrct of'carefullevic\\'ancl stucly. I)rogmrns llllr.st lllcet thc tctst of tlrgclsancl rydorlLu-)ce."

Vhat's Inside ...

AIM Neu's l3ook l -aLrnchingl99f lGrach,rates AAAIN' l l l (J I ) ' l 'urnoverTliple A Awardec Alr-rntni I)r-ofi le

"Quality Means Survival"Launched in Indonesia

Prof. Rene T. Domingo (left), AIM prof'ess()r ()n totalqllality managenrent and autlxrr if the best-selling lxxrk

Quality Means Suruival ptrblishecl by Prentice-Hall, n'as

keynote speaker at a recent ltcxrk launching held at

Shangri-La Hotel in Jakafizr. Inclonesia. Mr. Krisantcl

Santosa (rigl-rt). Director of PQM Consr-tltants andpublisher of the Bahasa Indonesian version of QualityMeans Survival hosteci the launch in Domingo's honor.

Prof. Domingo is the Sime Darby Professor of

Manufactunng and the progrum clrector of irs AdvanceclManufacturing Management c()tlrse. He trains rrnd

consulLs for a nr-rmber of Asian companies in tl-re fielci

of total qllality m2rnagelnent ancl business pr()ccss

reengineering PQM Cctnsultants, on the other hancl, is

an independent training, consulting and rese2lrch

institution on Procluctivity and Quality Managementfor-rncled in 1987 and is among the most erperiencecland the most innovative consr.rlting organizatirlns

specializing in Totzrl Quality Managetnent in lnclonesia.PQM was zrlso the first company in lndonesia that was

awarded an ISO 9001 certification.

Pearl Anniversary GraduationA total of 289 clegree pr()€{ren-} stttclents fiorlr sixteencolrntr ies -- 1i l1 MRM. 68 MM ancl 40 N1DM --

gracluatecl from AIM last summer. Guest speaker

Jaime Augp.sto Zobel de Ayala, president and CEO of theAyala Group of Companies exhortecl the Pearl

Anniversary gracluates and clrew out irnportant lessons

on managetnent fr<tm the ongoing Asian economiccrisis. FAIM chaptcr heacls Rob Chandran, MRM'74(U.S.A.), Pornt ip Iy ir lapun, MBM'92 (Thai lancl) ,

Bimal Chapagain, MDM 96 (Nepal) . ancl Wil ly

Parayno, MllM'77 (Philippines) graccd the occasion

and welcomecl the graduates to their rcspectivc

alumni urrsoci:rtftrns. The di*inction graduatt: ur MIIM wereGauravdeep Shriram Ratra (India), Rodrigo C.

Callit (Philippines), AlcLin N'I. Cenado (Philippines), anclAnna Isalrl F-. Villanr.reva (l'�hilippines). In N{M u'ere

l.r-rcretia Ang Miranda (Philippines) ancl NagraprasadVcnkat Velamuri (lnclia). In MI)NI wcre ALlreli() B.Balaclacl ancl Sinon Petcr Il. Ciregtxio, lxrth F'ilipinos.

1998 AIM Graduates

COUNTRY MBM MM MDM Total o/o

BangladeslBhutanFranceIndiaIndonesiaIsraelMalaysiaNepalNorwayPakistanPROCPhilippinerSri LankaTaiwanUSAVietnam

Tota

I(.)0

r l1 1

I0I

r)I5

1 1 502

0

181

III

9IJ05L106

J500oo

68

2

4

J

2I

5 2) )

I

5)I

I

t 4

r71I

22(t

289

1 .00 .1o.3

18. (7 .60 .31 . 7t . f0 .30 .31.8

59.20 .3o .7o.72 . 1

100.1

GENDER MBM MM M D M Total o/o

Male

Female

1 2 556

5 l

1 1

261 l

208

8 1

.Oo/o

.7o/o

.3o/o

i.0o/o

.6o/o

.3o/o

.7o/o

.7o/o

.3o/o

.3o/o

.8o/o

.2o/o

.3o/o

.7o/o

,7o/o

.lo/o

).Oo/o

7Oo/o

30o/o

Left to r ight, Anand Batepati , MBM'99 student, Ramesh Gell i ,

MBM'72 (whose son Gir ish Gell i was among the MBM graduates),

former FAIM Chairman Bob Chandran, MBM'74, AIM Board of

Trus tees member Ed Dav id . MBM'72 and AIM Dean Jess

Gallesos. MBM'73.

MM '98 graduates during the graduation ceremony.

Prof. Tess dcl Rosario. MDM Prograrn Dirccror, uith N4DN,4graduates during the Cocktails after the graduation cerctrlony.

Pepsic, Executive Talks on IeadelshipHon' top-le'u,el tnanagcrs inspire, lcucl ancl lnunegechange in a tlrie <f transition is cruciul to organizationlrlpclfomrance. A Pepsi Cola l,lri l ippincs crccr.rtivesr-rgg4ested tfrat the plilctice of rrselvaltt leaclcnhip" coLrlclenc()urage empkryees' accephncc 0f ancl crxrpcrlrtio|rn'ith neu' ntanagentent torvarcls thc firliillnrent oftr rrnpany gr uls.

PepsiCrila Phils. chief olrrating <fficer.|orge Sevilla tolclMBM

'99.stLrclenLs enrollecl in the Fltutran llchar,'ior in

Organizations class of Prrf. Denise L<>pez, that scrvantleedenhip demrnstratecl by drc exe.ctltivc te.un had lrentl're key to ef'fectively tr,rrn arolrnd the beleaguereclsoftclrinks company which changecl rnanage'ment handsseven times in a span cf 19 years. Temperccl nith ltasicvirtLles of sincerify ancl hr-rmility, "selvzlnt leaclership isone that is hurmble, not arrogant. Helping, notdernanding. Making a clifference on others, not self--seling," he explainecl.

Sevilla cites rfher letclership values such as prrfi:ssion:rlcreclilri l ity and teamn'ork 2lntong the PepsiCo Phils.nranagel-nent team lncrntbers ltuilt through the years ofr,vorking fbr a rival carl-xrnatccl ln,erage firrn. Peoplcemfx)wen-rcnt, hc acldsl. lr-.clnc the setrncl step t()\\,arclsc-reating algnecl r.'isictn, misskrn, and valtres. At PepsiC<tPhils., the clevelopment of PepsiCo Phils.' ntissi()n-vision sarcnrcnt and crmpany values wals dcne crJlegially,thereby bsowing collective crwnership and crtrnnitnentamong all meml-rrs of the ctrganizatr<n. "Orglnizrtion

vision-mission must be alignecl with the individLral'spemonal rnission. This aligrunent resulls in a pemonalmisskn continurum such that the lrnon's jcir is nct longera job but parl rf his pemonal mission. Values shourlcl betl-re clriving force in the pursuit cf a crmpany's vision,"addecl the firrmer Cocu-Cola cxcclrti\,'e.

Going beyond mere slogans and pp sales rellies, a "Pe1-rsi

Braveheart" convention whicl-r cr-rlminatcd a series ctf

nrission-vision-vahres aligmrent I'n<;rkshops rn PepsiCooflices thnrr-rghout the arctipelago, proviciecl rhe r.,enr-rein reaffirrning organizati<)nal colnll-ritntent to "get Pepsiback on its f-cet. and again, lrc a respectecl cornpetitor inthe inchrstry," saicl Sevil la. l ly also fircr.rsing on otherstrxtcgic urcas suct tN c()nsLlnterr lrrcfcrencc, u,iclcsprcaclaveilabiliq' of Pepsi(ir prrhrc'Ls, l< llv-c'ost o1 rtrtions andrlLraliry inhrn"natirxt, the cornplrny guinccl 2l pcrcentmlrrket share in I)eccntlrr last ycar, fhrnt l2 pelcent atthc tirnc of trrnsition ir-r-flrnLrarl' 1997.

"l)eti.t l tps nrore than plttt ing in lt lece thc kcy'strategies,thc lcaclership vultres ancl sr-rccessfirlly rnanlging change,rr'e luvc slrc'ceeciecl in pnx'icling f'uith, lxrpe uncl love inthc organizttion. Feith in orrmclvc.s, tllet \\'e can clo theirt'rpossibie. Lftrper, tlrat therc is rr lrftcr trxl<llrow, andl<;ve that forrner cnct'nics can l)c fl'icncls ancl nuftners."Sevilla concluclecl.

Editorial BoardEdi to r - in -Ch ie f . . . . . . . . . . . . . . . . . . . . D igoy Fernanc lezManaging Eclitor Of'el Oclileo-BisnarFeatures Ecl i tor . . . . Drncly CleudioAssociate Eclitor Michellc LirvanagC o p y E d i t o r . . . . . . . . . . . . . . . . R o s e C a s r r oLayor:t Eclitor Arnel FerrerC o n t r i b u t o r s . . . . . . . . . . . . . . . . . . . . . . . . . M a r k B a g a t s i n g ,

Yvette Bautisla, Donna C:rlt:rlkr, Sahlee Cerino,Dulce Casarclang, \Weng Corlcxlez, My.la Fabre,ancl DayceeMagaling.

AIMLinkCommunications Board

l langlaclcshHong KongIncliaInckrnesiaKoreaNcpalMalavsia

PakistanPhi l ippines

SingalrorerTaiu.ztnThaila nclU.S.A.

Milon l l . PuulLrrcius Lai King l)ui

.fuzar KhorakirvalaLeonarcl TantrlrrataChul-.fin LeeIlirnal ChapagainTan Sri Dato'ir TllhaHaj i Mohcl. FlashinrN{. Farooq Raja

-fose Maria FcrnanclczDtrlce P. CasuclangGan Chcong FlngChristopher 1..F, LinPornt ip Iy imaplrnRolrert V. Chanclran

MM'flf3MRM'80MUM'75MRM'77

MM'76NIDM'96MBt\4 76

ItMP'7flMBM'73NIIIM'73MBM'82T\MP'77

MI]M'92MT]M'74

Alumni Share Nuggets of Wisdomwith Students

tastJuly, the Placement Office organized the first series

of Career Oveliew Talks for AIM students. Invited

alumni from each degree program shared theirpostgradllate job hunting expteriences, career highlighrs

an moving up the ladder of success. Str-rdents were also

provided tips on surviving campLls life, coping with

academic demands and enhancing interpersonalrelationships to maximize their stay on campus. Three

alumni speakers were invited for each career talk.

MDM CareerOverwiewTallc Gina Lopez (MDM'93),

General Mzrnager of ABS CRN Fou-rdation and President

of the Southeast Asian Foundation for Children's

Television discussed key success factors in identifying

and managing the foundation's various development

ppxAgrams (such a-s ktnt(U ktt(t and Siru:k'tuela), rcme rf

which have gained local and intemational recognitions.Former AIM prcrfessor Ed Coronel (MDM'92), now \?'

for Corporate Affairs of \XMC Philippines, Inc. pointed

out the value of Social Marketing in his various career

challenges as a representative of the Depaftment of

Finance for peace negotiations with the Moro National

Libeiation Frrcnt (MNLF) and as an executive at a mining

company. Finally, Ramesh Bhujang (MDM'91),

Director for Operations of the Asian Finance andInvestment Cotporation Ltd. gave his personal insighrs

on AIM and perspectives on career and life.

MM Career Overview Talks. This component dealt

more on. profound topics such as attrturde towards work,

decision makingand prionties in life. Prof. Tommy InWz(MM'83) illustrated his career and advised the str:dents

that the only way to succeed is to "enjoy and like whatyou are doing". Former professor Ruth Callanta (MM'86), consulant of the Asian Development tsank (ADB),

the United Nations Development Program and other

Seated from left tor ight, Ofel Odilao-B i s n a r , M B M ' 8 8 ,AIM Di rec tor fo rP lacement andAlumni Re la t ions ,and the MBM CareerOverview Talk guestspeakers, Tilak Sen,MBM'77, TonyYa ldez , MBM'88,and Melody Hwang,MBM'98, and MBMstudents.

organizations, strcssed the need to practice values such

a.s honesty, hard work and truthfulness while struggling

at AIM ancl at the workplace. She also alked alxrtt how

her studies at AIM brought her to a iourney of self-

discovery and consequently changed her goals in life.

David Chang (MM '93), Chief of the EngineeringDepartment at HLttama-RSEA Joint Operations Inc.

discussed practical tips fbr overseas students while

narrat ing l t is own cxpericn( 'es.

MBM C.areer Overwiew Talk The most junior among

the pprest speakem, Mekxly Hwang (l'4BM'!8), crurently

a Management Associate of Citib:rnk, shared s()me ofher most unfirrgenable job hr.rnting experiences amidst

the Asian financial cnsis by stressing the importance of

positioning and rnarketing oneself in order to succeed

during these clifficult times. Likewise, Tony Valdez(MIIM '88) cited the irnportance of developingcommunication skills to ]r altle to stuvive ancl competein the real world. Tilak Sen (MtlM '77), Senkrr Proiect

Gina Lopez, MDM'93, tells students: "Media is so powerful. lf

you have access to it, use it to your advantage to bring out the

good."

Specialist fbr Asian l)cvekrpntcnr l l l ink citccl AIN,I'smulti-cultur:rl environment n hich he lps to clevcloplnore open-rnindecl stuclents. Hc aclr.. isccl N,l l i \,Istlldenls, particularly ovclsets stuclents to intcnrct r.r.itltother llccple a.ncl clevekrp netr,r,'orks. Hc ulso cncor-u:rgeclthe stuclents t() ventl lre int() their o'rr,.ri l tr-rsincssshourld opporttrnit ies arise. Nlr. Sen sharecl sonte ofh is most r - rnf i r lget table erpcr ienccs i ts un AI \ ,1s t t t d r ' n t l r n r l : r s t r l ' l t r s i ncss r r r r rn .

Ove ra l l , t hc Ca rcc r Ta l ks u ,e rc up l i f t i ng unc linspiring. The Placement Ofticc plans to conclucrthese regularly to irelp stlrclcnts early on cltrringtheir stay at AIM in achicving tl leif shor.t-tcrnt ancllong-terrn goal.s in lif-c.

Prof. Tommy Lopez, MM'83, talks to students during the MMCareer Overview Talk, with Ruth Callanta, MM'86, behind him.

David Chang's (MM '93) posit ion as thc Senior Engineer/Chief ofEngineering Dept. of the RSEA Philippines for the Skyway projectin Metro Manila, Phi l ippines, is just onc of his many overseasassrgnments. He has worked in lreland. Saudi Arabia, and U.S.A.besides his own country, Taiwan R.O.C.

AIM reps finish Asia-Europe ProgramF<ul putticiltarts fr<rn-t NI4 gr:rc[ratccl fiont the inatrgr-rdAsia-lJlrrope Prognrntnle et the Institrrt cl ' EtrrclesPolit iclues cle Paris (Sc'iences Po) n hich commcnceclon. | r - rnc 22 encl conc|- rc lcc l on - f t r l1 ' 31. I )on PintoqN'IU\,{ '9u, tc4rpccl t l ie progllun's rnaiclcn batch bygurncring high honors. n'hile Rajeslt Shar.rtra, NIIIN{'913 lncl Nlvlu Fabre, AIN1 Placerne nt Program Oflcer,f inisl-rccl w'ith honors. \ 'ang Fcng. rrnother MRM '9u

ah,rmna. pur-ticipatecl rs u Frenclt Nlinistrl of ForeignAffhirs ltr()grlut't scirolur ltesicles l)on ancl Nlvla.

Tr.r 'entv-onc pxrticipents front Korca, lnclia, Chin:r,' Iein'an.

N1acalr,-f rrpun, N{aluy'sia. Singapore ancl t l 'rePhil ippincs joinccl the sir-u,'eck intensive, English-taLlgirt progrant thrrt proviclccl thern u mlrlt i fhceteclLncle$timcling rif Eun4x- ancl dre Elur4ran t Inkn kxLry.All progranr pafticipents gaincd r,'ah-raltle insights alnr-rtErlnrpcan integration uncl its irnplications for ltusinessstlltcgies, the l,< rrlcl cc\ x-l( x)1),' ancl intematirnal relations,thrruglt a r.arieq.' of lealning lnethocls ancl cnr.ichtnentactivities such as lcctrres, rrlc pllry'exercises, c()lnpanyr.,isits, a tu,'o-clay trip to Flt_i institutions in l}rr.rssels,Ilelgir-un, ancl musennt visits arouncl Pari.s. Internshipswcre optional. Irctr coutpletion of thc coluse, dtey' w.ererccl-riecl to w'rite, sr-rllnit ancl clefcncl a research paperrcler,'ant t<t llLl lrusiness trencls ancl issr-res, ancl to passa writtcn exartrinatirin udrtrinisterecl ltr, ' Scienccs Po.

Ifousecl in 17th ancl 18tlt centl l l ] 'munsions, SciencesPo is locatccl at thc St. Cienlain clc l)r 'es clistrict. inthe heart of Paris. TI-re institr,rt ion's Asia-EurctpeProgramme Director i.s 1)r. Davicl Cantroux.

Scienccs Po Asia-Europe Programme parl icipants at the Inst i tutD'Etudes Politiqucs de Paris with Prograr-nme Director Dr. DavidCamroux (second row. lar lef i) . AIM representatives to theinaugural Asia-Europe Programnte are Myla Fabre, AIM PlaccmentProgram Otllcer (fiont row, third from left), Yang Feng, MBM'98,(beside Dr. Camroux), Don Pintor. MBM'98 (third row, secondfrom left) and Rajesh Sharma, MBM'98 (third row, third f iomr igh t ) .

Triple A Testimonial DinnerIn Honor of Dean Jess Gallegos

The Trfle A Ch,rl; hostccl a testint()nill climrel firr this

year's NLulni Achicvettrent Au'atcl (Triplc A) rccipier-rt,

AINI l)eanjcsus G. Gallegtx.fr. (NI}3NI'73). ' l 'her clinner'

r.r.'rn hclcl on April 16 at thc.T.\'. clel R<isario lltxrttr ttf the

ACCtlFll) ancl vn'as rtttenclc(l ltv the pest ' l i ' iplc

A

An,arclces. AINI Alturli Assor.'iati<lrr's lloalcl of I )in-'cttlt:,

pa.st drairpcrstxrs, clirecttlt's ancl gltestsi. AlNl l'�resiclent

Fil Alfirnso citecl thc valuc of thc ef'fet:t ive rr'orkit-tg

1-xutnership lretn ect-r his ofl lce ancl I)ean Gallcgos in

attairril"lg thc goals of thc lnstittrte . IANI)CO Prcsiclcnt

Frc 'c ld ie Xctcz- l lu t t 'gos (Nl l lN{ '71) ar lc l ( ,hou'k ing

l)rcsiclcnt l lobclt Kr-ran (Nll lN'l '75.] 'NlP '93) rerc'allecl

mernolies of thcir J)l lst rlss()("i lrt i<ln u.' i th.Jcss anci u'lt1'

thcy' lrelicvc he tntl l ' cleserves thc ' i \ ' iplc

A Atvarcl.

Standing from lef i to r ight: Prof ' . Phi l ip Juico (MIIM'73). 1987

awaldee. Dean Ga l legos . Mrs . ( i ig i C ia l l cgos , JC and Jay 4

Cia l l cgos , A IM Prcs ident F i l A l fb r rso (pa l t l y h idc len) , FLcdd ic

Xerez-Burgos J r . (MBM'71) , 1994 awardec , and Mar io Ncry( N . 4 8 1 \ 1 ' 7 3 ) . l 9 l l 5 a u ' a r d e c . S e c o n c l r o w : D a n d y C ' l a u d i o(MDM'93) , FAIM Coord i t ta to r , Du lce Casac lang (MtsM'73) .

AAAIM F.xccutive Director. Eric l lernandez (MtsM'96). Bobby(jarcia ( M BM' 7 3). | 9'7 9 arvardcc, Abet Vi l larosa ( M BM' 7-l ) , I 982

awardee, D igoy Fernandez (MBM'73) , AAAIM and FAI Iv I( 'ha i rman, Rober t Kuan ( l \4BM'75) , 1980 awardee. and ( l i l

Vcndiola (MBM'76), 1996 awardce.

(continuedfrom page 8... Alu.mni Profile)

recklrncl to the govenrnent, lvhic:h <r;r.'trecl dre lancl helcl

by Pr,rblic Estates Ar-rthority ancl t ltc Financial Center.' l 'hen,

therc u'as this nrtrch-ignorecl proposal --

c()lrplete l l ' i th a tinre valttc analysis -- to sirupl,v

leasc orrt the Roppongi pl '()perty at attractive ratcs

instcacl of sc'lling it, ancl getting fr-ee living qualtcrs ancl

an elnl)a\sy tlrse f<x fiec. Next tinrc aottncl I got to lorfi

with hvo other AINI grads helping in the establisltntent

of thc (ixlclinating (iruncii tf tlre Philippine Arsistitt-tcc

Pnrgram, u'ltich, firt'r'uriotLs rcts()ns. l'es cr.tvisionecl t<r

str pplant thc Natr nal I'lconr ltrit' I )c'r'eloltrnctrt Ar-rtlx rrity.

Thc CCI'�AP u'As to ha'' 'c lreern tl-rc velticlc l ir l all-

mrrltihteral amll-rilateral eid ancl loens. n,ith thc Nlll)A

secretariat prrvicling lta<,'krxrtn supp(x't. 'Ihings

clicl n<{

nlrn ()Lrt as plunnecl ancl I lcft after a year l)ccause ()ttr

lxrss, ltollcfio ll VillanLreva, a ckrsc fl-iencl of thc AINI

tiuril\', srrliLml a cle'lilitating lurrt pnirleut n4tich rccpiml

hirn trr stop n'orking ancl lear.c for an operttion altrttacl.

\'lv last lrssigmlent in gor''ertltrent firtttrcl tle acccciing

to ckring lrll thc necessaly spilde\\/olk ltncl tlt theorcticai

fi-.rnrcuru'k ultidr lccl to the organiz:ttion tf tlie l)hili1-rprne(.lr a rity' Sn'ec;rstakes Oflice C)n-l inc L( )tteD 1'rrojcct,n'lt iclt is popLtlltr lv -- l l ttt crrone<tltsly -- knou't-t tts

thc lrrtt<r.'flre cotlptttcrizecl kttcr1,'is t-torv a rcsotncling

suc('css, blrt crrr-rlcl clo rluch lo-ttcr if tlte p:tcc tf tentinal

rikrLrt is irnl'lrrv'crl atrcl if innovatire gJnrcs atc intrx[tctrl

cvc'r) ' I\\ () \/eltfq ()r s().

Non'. togctlrel with clilll'rent sels rf fiie'ncls, I ckr financial

prrckagi r - rg - - t ry ing. as L lsLr? l l , t ( ) present ln( ) l 'e

inn<x ativc prxh-rcts. 'Itre

Asian uteltclou,n ha..j pllt s(xtte

sort of a crinp <n this, lut gr.,es tlr cleative drinker nruc-h

l r1 ( ) re f ( ) ( ) u r I ( ) l nancL l ve r t han c lesk -b< t r . t nc l

t rac l i t ional is ts .

Wl-iat thngs ckr I hlieve in ancl rvltat lx:lief.s ckr I hold

clear? Aftel all thesc .vcars ancl c1-titc a lrit of n'relkrrving,

rny mclicelisn is nou. firr-necl on pt:rcticing r-rniry of lifc,

pnrvicling cnrphasis to Gtxl, fanrily, rvork, ancl cotmtry

in tl'rirt ordcr. I pr,uposely reject doing things that n'oltlcl

recprire n'rc to spncl t<xr tnr-tch tit'tre away fkln lnllre and

the fZunily', or utrich ll<nilcl ntf alknv mc ellxtw rxnt fitr

the nonnal obscn'ance ancl practice ttf notms of piery.

While this ruay sor-tncl c()m) k) sotle. lttttting tl-re Lord

at thc centel of nry lif'e has pux'iclecl ltalance ancl frrr.rs.

ACT Holds Bowling Tournament

The AIM Club of Thailand held a bowling tournament on May l6

at 1he Brunswick Seacon Scluare Bowl at Bangkok. Klun Pramual

Nurach, MBM'96 (back row, second fiom lefi, partly hidden), was

llre top scorer of the 1un-fllled activity which was participated by

alr.rmni and their f 'arni l ies. Khun Porntip Iyimapun, MBM'92,

ACT Presidcnt (fiont row, standitrg), are shown with other alur-nni

who attended: Khun Tanavadee Kasetsuvan, MDP'94, Khun

Prakarn Dherapratuangkul, M BM'9 I , Khun Preecha Prasatwattana,MDP'g l , Khun Than Sir ipokee, MM'95, and Khun Pornpirnol( ha ichar rakr jo rn . BM P 'q7 .

AAAIM Board of DirectorsTurnovef and Appreciation Dinner

On-fune lB, oLltgoing AAAIM officers ancl clirectors anclthe inc<nring set of ncwly-elected ahtmru lxnrd memlrnpafticipatecl in the annual tllmover c-erenr)ny held atthe Concepcion Room of ACCEED. The cleclicatedinvolvement of members in the Associationrs activitiescLrring the last fiscal year lr,ere also given due recognition.

Seated from left to right are Dulce Casaclang, MBM'73, ExecutiveDirector; Connie Parungao, MBM'88 (incoming); Nahnee Monje,MM'76 (outgoing); Evita Florendo, BMP'76 (outgoing); DigoyFernandez, MBM'73 ( incoming cha i rman) ; Berna Lomotan,MBM'74 (past chairperson); Ofel Odilao-Bisnar, MBM'88, AIMDirector for Placement and Alumni Relat ions; and Alex Eva.Executive Director, AIM CEO's Club. Standing from left to right,John Simon, Prof. Titos Ort igas, MBM'83;Marvee Celi , MBM'95,L,xecutive Director, AIM-SRF; Bueno Casti l lo, MBM'86; JingAlampay, MBM'74; Willy Parayno, MBM'77 (outgoing chaimran);Eric Hernandez, MBM'96; Alfred Xerez-Burgos, MBM'71; MarGatus, MBM'75 (outgoing); Jet Magsaysay, MM'89 (outgoing);Fr. Soquino, MDM'99; Nanding Ramos, MDp'79 (incoming); GaryGrey , MBM'74 (ou tgo ing) ; and Mark Bagats ing , MBM'96,General Managers, AIM Tigers Club.

Blessing of the New AAAIM Office

Fr. Tito Soquino, MDM'99, blessed the AAAIM offices at the 4thfloor, ACCEED in simple ceremonies attended by current andfbrmer off icers and directors of the associat ion. With God'sblessings, it is hoped that the projects of the association will besuccessful for the benefit of AIM and its alumni.

Alumni Trivia:Revisiting AIM Yearbooks

The Thernes, Some Facts, and Familiar Excerptson AIM Alumni

By Mctrk Bctgatsing, MBM,96

197 5 -The Year of DiscontinuityNory Reyes-I-ao. MIIM'75, "I live an orclinary life,srking oclirnry q)fxlrtluitirs, zurl lkrling orltnary h.4pirns.'Ncr one u'as elected SA chairman in i975, Due to thecleadlock between sections 1-A anci 1-B. the SA wasrepresentecl by a three-man leadership. The famousSA lioika as they were known was composed ofRobert Suarez, Sid Consunji and UdayApte.

1976 - MM'76: A Class Ttrat Defies Forgetting"Gattling Gun" Vic Narayan - Cor-rld talk a mile amlnllte..."Mystery Man" Yacob Isa - Spins an Asian proverbat every oppornrnity and spent his last clays applyingmanagerial skills trying to beat the Manila Ray Casino..."Chuck" Tolbert - whose idea of carnaraderie was toyell in class...

1978 - A Decade of Entrepreneurial LeadershipPedro S. Ruano, MM'7il - "To make a decision. wcmust make a deci.sion."Geoffrey Uyrnatio, MM'7U - "The original .JEPROKS"AntonioValdez, MM'78 - "singrng is nrf my frrrte...beeris."

1980 - Challenge of the EightiesMBM'80: A Proflle - "YoLt know that I know that youknow that I know."Auge Palisoc, MIIM'8O - Well rememlrcred for hisnTheory of the \7or1d"...Gary Anderson, MRM'flO - Stubborn and adamantwith his a++menf,s, qrcially when he crfftot s,rbstantiatehis points. His last resoft is to conclusively concludethat there ain't sufficient case facls to arrive at a solution.',

1985MBM'85-A,: "A Class <tf ils Own,'Ferdinand Castillo - The compurter g,rru...,'His lovefor his profession is overwhehning. ProoP Ask for apoftrait of his love, and he'll show you a picture of atransformer."MBM'85-B: "\What a Great Vacation'fhat Vasl',Joaquin Singson: "His wardrobe would shame anywoman's closet..."

Alumni Profile: Irigoy Fernandez&pittrtinq thi; Ls:trc, AI\IIAK latnrch6 a rtgttku"secticttt

fbantnnS4 an ohmntl$ or dlttttttt(t shaitry hLs u'ha'lilb(ctfter AIll) sktr1'. l"ttr irrstctnc't:. clicl .)'r.ttt ktrn'thctt FAIM

I'-ottrtclirtg Cbairmun urtd Si\t'er .lttbilariun ./oseMct. FLmmrufuz L; n rrtrtlti ktktrrk:tl kt? ytttnunrrc it: lxtttJ*:r:

ln rsin ess nt cu t. Ro tct iar t, C'a t h I ic ( " h tistuut. c r I t t t t t tt ist,

ent )ir( )n m e n t u I is I. . I ttl' c' ee ru uJ m r.t s t e r o I p h o k4 ru lt h.y.

A crertlrn'arrcl relinner tbatt merc plttn irrryilcntenk,tr,

Digt4' cLscriht; irt r,nuftshell. hrs rn Lltifirceled pntlixsfu trnl

antl perxntdl dchieuetnettls thut hat'e rlt intized

the use ct'his Gorl ,qit'ert talt'rtts. Accttstttntetl trt the

pngr*:itv uttys of'ptitrtte s.rkr btsitttxs. he alst., tlisckxt;

tbctl his sbu't stit tl ir t Ruvtt tntertt vtuice hrul lvr,trt it tshtrcthe.

I l'nve always Men citltet'a cirearncr or a fellor'v rvhtl

woulcl clate go egait-tst the claily grincl, <xrc lvllo tlxrugllt

rhat thing; curlcl lxr nltclc to u ork l'rtter or cliffc'rcrrdy. This

trait wruld rfien crntre to thc fi-xt in xlxxi, at w()rk, ()r ill .

the difldt-nt s( xi<xivic < 41aruzrti< ns I lrYullgeal to get lr1'x'lf

entangletl in. I rerturtlrr lrc\turg pirt oltt il Lulllx x n is.sllc

for <lr high sclxxrl palxrr - thc tflrer e{itcrn lting-fe'ss

Ciallegx, now AIM I )ean, ancl 1V 2 g"etl D.rncling Lltc'en r.

Tlre clinclrer\\':ri oLu' l'lat* crtvcr plxto rf tire ethttxrai

lxvarcl, whicfi fe.rtr.uc-cl lLs it't variotrs stltgc's <f Lndrctis.

I was lrrdrtl at<p tfu cr-rbic'lc cliviclen cLtcl only ir-r an

lnmaculate white torvel

Then. therc n 'ere t ' t r ioLts ef fo l ts at rac l ica l l l '

assefiing ourselves r,ia the stLlclent lll()\/elllent ancl thc

establishnlent of the first left-rving grortp in a

Cathriic schixrl. F-<tlkrwing that n'as ottr 1'rarticiplttion it.l

nrrtr-rmal visits ltncl pitchecl lnnles that tturkccl the Irirst

Q,nrter Stonn. ctntinttor-s striclent clettnrnstrations agdnst

thc martial lau' tcgiltre, acceleratecl strect-pK)tclsls after

Nincry Aqr-rinos llsvt-ssinatitn, 1-rh-s nuny trhet acive'ntures

tcxr crrlol1itl to telate in a seclttct ltleclilull sltch as this.

AfterAIM t paid nry ch-te; ancl wokctl cltrtifr.illy fbr 13 yem;

:.r.s a bankcr-tit{t<r dre clrilyginclrfn'tltri, wrxk, and trxle

wrlltl<. Nf clre t< r get I x xJ with r niline, I I nvever, I n ruugcd

to get rr\sgtlcl t<r'natirt ts intercstrng 1ix, tilc fint tf ll4-rich

waLs lielping rr41.u-tizc lar Frrst llurk lurcl estaliish ne'\\'

units tlrat u< trlcl :rlkx' dre I v.urk fi r h xh pn p1t:.s a-rd upwzml

mobiliqr. An rplxrr-rnity pt:iente'cl itself jLLst tlrn: r rmagng

the newly crurti l}anch I )evct rpttrent I )ir,'isi< n tlnt lv lilcl

ovelsrr tlre lvank's expansi()n. lt clicl nct trlie kng trr str: drat

the key ftr expansitn \\'iLS nrtnp()s,'er cler''ckrpurent ancl

training. kr, wc chcn' trp ()Llt'()\\'tl inJrlrse pn6tr.utr which

had as runy lr^s X)0 tr:rine,rs tr <ilic'en in vuior,s

sugl <f cler''ekpment :rncftl' inrprn'enrcnt. -l-his

wzls alxr

the time that \\ 'e stltrtccl se ncling fir lrr to

sx nidclle ancl senior1)r i - ln lrgers to AIMt o w i c l c n t h c i rpcrspec t ives anc lthink progrcssivell'tou'arcis enrichingtheir careers.

'l'uecl rvith tlut, I u'asnert assignecl to takcr r.,,er tlte l llilrYlgeltl(rnt

o f a c l o s c d - e n c l

nl-ftnl h.rncl n'hich ()ur te-at]r gx bac-k (n atck mcl ckrublecl

ir-i ternrs of net asset value. Thcn firlkrw'ecl a secc)nd stint

in Corpl:rn that sa\\r the formr-rlation of a ten-year plan

fbr the l'rank which is still hing fctikrlvecl t() this clay. As

e.idy as 1985, it \\'as clear tl'rat nuny institurtkxrs still hacl t<r

nraximize the lrcnefits clcrivecl fionl thcir IT rescl-trces.' l 'he

core of the plan envisionccl evolving thc' bank

into a lean and mean, people-- ancl technology-

cll ivcn organization lty p151ng sttch tcchnokrgy t<r

acl'u,antage. Ry nctt luvng kr sltncl hcavill'(n real estate,

w'e thought of dispcnsing n'ith tl 're tr:rclit ional bank

branch ancl setting up nrarketing platfirrms tlf three trr

fivc people insteacl, linkecl to thc urother llranches and

the head oflice try c(nnpLlter. 'We also thor-rglrt of cloing

alr''ay r,vith tlte backnxrll encl the extremely k-lng weitrng

times for traltsactic)ns. Mctre ATN4s rvoltld be set r:p.

After lcal'ing thc trank t<l u'ork rvith government. I saw

J'ito Santos cluuing ()ne of the AlN4 2lllllllni rer-inions ancl

passccl along the germ of an iclea I nalrghtill' thor-rght

that s()nre other lr:tnkers shrltt lcl pttt into l l l()t i()n.

This iclea lccl to tlrc setting r,tp of Nlegalink. I 'n'hich

J'ito ancl his groul-r er.'entually' lefi llel'rincl t() set Llp

Ilancnet. The objectir.c \\'es t() etlirrcl access to nrany

nrore {I 'N'ls rvithoLtt having to inrrcst in to, ' rtrany of

these r,rnits, whiclt, to this clay, are or. 'erly cx1>ensivc.

(krvemmcnt sen'ice ptrtre.cl to lx'm"stnrclive ht somewhat

baflling to sonreone sclxxrlecl in the ways of the private

sect()r. The flrst tinte aroltncl IfirLrnd mysclf in tirarge of

the Phil ippine'Itrurisnt Authority. At that t ime. tnany

of the government's assets, iqclucling the presiclential

houses, \\'ere telnporarily hor-tsecl with nle.

Annng nry ftl[trels was tltat ll]y lcc()nlmcndatkn fbr the

legislatr-rre t() m()ve into the Philippine Nzrtional Bank

llrilcling lrcanre a political anclnreclia ftxxball instead.

F.spccially n'hen the cost of renovating the structure

ballcxrnecl to tl-ree tirnes thc original estilnate. The logic

then wzrs that tlre crrncrxnitant in<-re.rs-'in land valtrl wtlild

(continued on page 6)

MEAN

"The future of women in busines.s rs so bright. we mighthave to open our eyes wider, if to see is to believe Licuanan: Watch out for the best

closely match managenal styles that comenaturaliy to women than they do to men.So leadership qualities of women stressOpenness, trllst, oltgoing education , com-passion and irnderstanding. Women alsoIely more on connections, and they liketo be more personal in terms of their man-agement style.

Women are also more apt to try andchange people rather than control them.Because of this, we will see a new genera-tion of women ieaders and managers whoare we l l educated and techn ica l l y p repared, but who are not afraid to use theirfeminlne instincts and creativity.

Consequently, another area to exploreis the effect of having a larger number ofwomen in the workplace itself. Womenin the workplace change the workplace.The impact of women on gender roles inthe organization's sterotypes actually stillpersist in jobs that are still perceived as"right" for women. Very often women arestill slotted into supporting occupationsthat are deemed extensions of thef domest ic sphere: secretar ial support , admi-nistrative, bookkeeping, accounting. Thenthere's the matter of stereotypes with re-gard to behavior. On the whole, womenare stil l expected to be decorative, sweet

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he factors that have contributed tohaving a growing number of womenin the workforce will continue interms of demand, once Asian econo-

mles get back on track after our brief dis-traction wlth currency problems. The tran-sition fiom an agricultural economy to acorporation, commercial and industrialeconomy and, subsequently, to a post in-dustrial knowledge-,based economy willcontinub to demand workers both maleand female.

In terms of supply, women workers willbe available as access to education andhealth has more or less equai ized. Weshould be thankful that in the Philippinesthere are fewer cultural barriers to womenworking outside the home. Also, we en.foy stronger support fiom the family nowthan even a few decades back. For ex-ample, women are mote confident to iointhe workforce in order to augment thefamily lncome, even when they know it'srisky business to be an overseas contractworker. The subject of women having ca-reers outside the home is really no longeran issue. But look at the managerial impli,cat ions. A dualcareer and dualfamilywi l lcontinue to fuel the demand for manytlpes of products that, collectively, help

keep the community's economy vibrant.An equally interesting aspect of the emer"gence of women in the business arena isHuman Resource Management. As the traditionai peacekeeper and nurturer of thehouse, women in business becomes a forceof commerce once they reach a criticalnumber. The impact of this on men, onother women, as weli as ori the reiation-ship between men and women is yet tobe thoroughly dealt with given yet anotherdawning of an era in business.

Changing EnvironmentWe all know that the environment for

organlzations has been changing in recentyears. We are shifting to an informationAge, which is also more global. Clearly it'sa time of rapid and sometimes intractablechange. We are also operating in a moreegalitarian society in which workers aremore educated, more aware of personal$owth and self-actualization. The result :the management organization is generallylooking less at the pyramid command andcontrol type of structure than one that isflatter and of a networking model. Whatis required of a manager in such an envi-ronment? Tnterest ingly enough, descr ip.tions of the manager of the future more

Tobet te rapprec ia tegender issues inAs ianmanagement . t t ' i J f f i

September-October 1998 ) fhe Asian Manaser 43

and demure. As such, actlons regarded as"decisive" in men ate sometimes seen asbeing impulsive in women, or worse.

The persistence of sex roles at homemeans that, by and latge, women whowork fulltime for wages also shoulderfamily-care responstbilities.

Fina11y, there's the way work is orga-nized. Conventional wisdom dictates thathaving a working father and a mother whostays at home and takes care of the domestic front. Overtime, the need for travel,after-hours bonding and socializing, fixedwork hours-these are all part of currentwork arrangements and for good reasons.However, this poses a lot of probiems forwomen who also have to make sure thatdinner is on the table, and that the kidshave done their homework. In fact,womenwill agreewith me that "Whatwe

need is to have a wife at home." As moreand more women rise up in the manage-rial ranks, we will s1owly see changes inthese aspects of work and organization life.We need innovations to meet the needsof both the organization as well as the em-ployee. This is doubtless sti11a time of tran-sition. Willwe see a rise in the percentageof women in the most senior positions?Wi11we oversee it to become 50 50 in theforeseeable future? Highly unlikely. I recently came across an interesting item re-garding the president and CEO of PepsiCola in North America. Thls is a large or-ganizatlon with sales of US$7.3 billion. Italso happens to be headed by a female

president and CEO. A 43 yem o1d motherof three and a wife. The item mentionedthat she had decided she was going t0 re-tire to devote more time to her childrenand to the family.

What will companies do? Global com-petitiveness requires that companies keepthe bdghtest and the best whether theyare male or female. In the future, we willcontinue to see women's issues being discussed. will or should women try to fitinto the existing corporate structure andmake all the adjustments to a male-domi-nated culture and work arrangements? OIwill companies adjust in order to keep thebrightest and the best?

Transforming the ModelWomen want to contribute to the build

ing of a new type of sustainable otganiza-tion that will enable everyone-men andwomen to contribute to the fullest to findself-fu1fi11ment. Many women want totransform the model, not just fit in. Traditional work affangements were formedunder the o1d model of husband works andwife stays at home and takes care of thefamily. But these are not immutable 1aws.We recognize that the demographics of theworkplace are changing. It is too late tosend the women back to the home; wecan't turn back time. This would requirechange in the very way production is or-ganized and in the way the economy runs.When we talk about the need5 to sharefamilv responsibilities, it doesn't mean

The need to

share family

responsibilities

doesn't mean

women want to

get awaY from

family care-giving

women are not trying to get away fromcare-giving. Women do like caring for fam-i1y members, but to do this and still fulfilltheir function in the workplace, womenneed to be able to move in and out of theworkplace and respond to changes in fam-i1y needs, typically the needs of children^ - l ^ ^ i - - h ^ r ^ h + -d r l u d B r r L 6 P d r c l l L J .

Entrepreneurshlp answers a lot of theseneeds. In fact the United Nations estimatesthat in developing countr ies, women run70 percent to B0 percent of small busi-nesses. But to go back to the corporateworld, companies can foster balance ofpolicies that underscote flexibilitpmaybeleaves of absence, part-time professionalr r r n r k i n h - q h . a r i n o f l p v i t i m p r p d t t c e dv Y v r r \ , l v u

hours, sabbaticals, and other such cteativearrangements.

All worklng people, men as well aswomen, need choices in the way they willspend their lives and then equality of opportunity to do whatever they choose todo. Top leadership is not for everyone-nor is it for everyone at every stage in theirlives. Some need flexibility, olhers wantto go fu11 speed ahead.

In a survey carried out at DuPont, 56percent of male employees also favoredflexible schedules whlch allow for morefamily time. Corporations that recognizethe need for flexibility and how much itimproves employees work will attract thebest people and will come out ahead.

Sociery is changing. Changes such asthat in the relationship between men andwomen are one of the most Profoundchanges a society can undergo. And it is achange that is being negotiated in everycountry and every home across the g1obe.Take it fiom the tich, famous, black andfemale TV personality, Oprah Winfiey:"The future of women in business is sobright I have to close my eyes." I

The Asia-Pacific Economic Cooperation (APEC) will hold the 1998 APECMinisterial Meeting on Women: Women in Economic Development and Coop-eration on 15-16 dctober 1998 in Manila, Philippines' In line $;ith this, theConfederation of Women Business Councils in APEC (CWBC-APEC) and theAsian Institute of Management {AIM) are conducting a study entifled Womenin Business: Contribution to APEC Member Economies & Impact of the AsianFinancial cnsis. Funding for the project is undertaken through the united Na-tions Development Programme {UNDP) efforts of Promoting Gender Equalityin the Asia Pacifc Region

Dr. Victoria S. Licuanan, AIM Professot' acts as Economics Consultant to theeconomies of People's Republic of China, Philippines' and Thailand in prepar-ing a poliry paper and conducting country' and APEC- wide policy advocary ontfri nienti6ried theme. This paper is used in focused group discussions andworkshops.

The studyhopes to recogtize economic activities and policies affectingwomenand men differently, the value of and support for women's paid and unpaidwork contribution, Cupport of women's role in business, and the need for rep-resentation of women in APEC forums.

To better appreciate gender issues in Asian management, this section is sponsored by the UNDP.

44 The Asian Manager September-October 1998

By Jose Ma. Fernandez

ATTACK

GLOBffiSpECUrATOnS

ust when everyone thought thatAsian currency markets had sta-bi l ized iusr a bir , providing precioustlme-no matter how little-for bat

Asia and Europe cry "foul" against world-class rogues in coat and tie

tered currencies and economies to catchtheir respective and collective breaths, thefinancial markets reeled once again dueto the yen's persistent weakness, confusedsignals over the direction of the Chineseyuan, and the devaluation of the Russianruble. This has placed pressure on theoverlords of the US Fed, with ChairmanAian Greenspan resisting calls for interestrate hikes in order to keep fimds fiom flow-ing fiom the already weakened economiesof the Far East into dollar instruments. Infact, the recent technical corrections in theUS capital markets have prompted specu-lation that the Fed wlll actually considerreducing interest rates, making the dollarless attractive as a refugee currency.

More interesting, however, is the increasingly strident call for a review of theeffects of globalization on the world'seconomies. This call, coming fiom boththe battered East and the ever-affluentWest, recalls arguments posted by oppo

nents of the World Trade Organization andliberalized trade. This early, some ASEANleaders and economists are openly testingthe waters and suggesting.that the planfor the AFTA be shelved in the meantime.Left unsaid is the inevitable return to aregime of protective tariff walls and othernontariff barriers shoLrld such a plan gaincurrency.

No Simple AnswersIt is painfully obvious that a return to a

protectionist regime may not be the happyanswer to f inanclal and currency cr is is.After all, the crisis is touted as just punish-ment for the many sins committed by dif-ferent countries in the name of economicgrowth, among them mony capitalism, du-bious investments in white elephantproiects, and ego-driven diversification.

Who would wish to go back to the timewhen shoddy goods were foisted upon un-wary and,/or unwiiling consumers, withlittle or no chance for redress? Who wouldprefer to have very few choices of a par-ticular good or product, with producerscharging premium prices to captive mar-

kets? Who could forget the times whencurreucy controls provided opportunitiesfor graft? No one, obviously.

What rankles, however, is the thoughtthat some twerp of a deskbound financialanalyst, with little or no knowledge abouta country or its institutions-much less anentire region with its myriad currents andundercurrents-actually has the power andthe means to undercut national and re-gional policies. lVhen more and moreanalysts say that funds should stay out ofthe region or divest from their current po-sitions, these analyses become self-fulfilling prophecies. This is especially ulle inthe case of financial and capital flows thatcan move massive amounts in the blink ofan eye across borders through electronictransfers.

Thus, money flows have a tendency tobecome what Peter Drucker refers to asdestabilizing infuences as they force coun-tries to undertake debilitating programs indefense of their currencies. Or, devalua.tions that often go below either purchas-ing-power parity or trade parity; maybeeven astronomical interest rate hikes that

September-October 1998 The Asian Manager 45

strangle business actlvity and force evenhealthy companies to go be1ly up. Druckercontrasts world money flows with themore benign and stabilizing influence ofportfolio investments-those made for thesake of short-term flnanctal income suchas d iv idends or in te res t ' tha t go f romeconomies with low short-term returns t0those providing higher retulns. Buttress-ing the point, portfolio investments havetended to react to countries' financial poli-cies or economic conditions, whereas themovers of financial and currency marketshave tended to shape or override nalionalpo l i c ies . F inanc ia l marke ts a re la rge lymotivated by immediate speculative prof-its rather than the mote mundane and lim-i ted interest income, encouraging them tocreate opportunities where none may havenrar r in r rc l r r ow ic tpd

Radical SolutionT t i e nn t c r r r n r i q i no rho re fo ro r h2 I I hpJ u , P ' r J i l r 6 !

world's f inancial centers- mainly in Lon-don, NewYork, Zurich, and even batteredTokyo f l ip tr i l l ions of dol lars a day. farmore than what is needed to fund actualtrade and investment accounts. Each dayf inds f inancial and currency analysts mak-ing 1lfe-and death decisions that permeatethe nooks and crannies of the countrieswhose curtencies they stalk and make pro-nouncements on. Ali these have made

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believers of some people who would haveonce considered proposals like a tax on allforeign currency tlansactions as heretical.That the idea has not caught on lies mainlywith the problem of implementation, sinceit requires 100-percent compliance amongall counuies and the inability of currencytraders to take advantage of the many taxhavens that exist all over the globe.

Then, there is the radical solut ion pro-posed by Paul Krugman-who was the firstto point out the weak foundation of theAsian miracle to have the ailing Asian^ - ^ - ^ ' _ i ^ . ^ ^ h - - 1 , r ^ : r p o i m p O f p y -( L U l l U l l l l r J

F ) U U d L A L v u ' L 6 " r r \ v , L 1 r

change controls in direct contravention tothe policy of open markets.

Can rhe oen ie be nr r t back in to thebottle?

Krugman admits that foreign-exchangec o n t r o l s o f t e n n r o v e d i f f i c u l t t o i m -plement: bureaucracy, paperwork, andabuse tend to downgrade such programs.The general consensus is that exchangecontlols do not seem to work, but giventhe current rock-bottom situations obtain-ing in Asia, they would seem to be attrac-r ive i f onlv as npcessarv evi ls thar wouldn r n v i d e r p s n i t e f r n m o u t s i d e a t t a c k s .Krugman precisely points out the case ofChina wh ich has heen ab le to res is t a l l

forms of attack simply because its currencyis nonconvertible. (ln fact, another econo-mist points out that, despite tumots and

Money flows have a

tendency to become

destabilizing

infuences as they

force countries to

undertake

debilitatingprograms

in defense of their

currencies

cal ls for a devaluat ion of the yuan, thereis no compelling reason for that currencyto float-as of this wtiting anpvay).

Desnite havinp heen derided for his in-flammatory remarks made against cur-rency speculators, Malaysian Prime Min-ister Mahathir was certainly not the firstto react to these so-called rogues in coatand tie. when the European Monetary( r r c r o m r r r q h o d i n t h p c - - r , , ^ ^ - r ^ { + L i .J y J L ( l l l ! l o J l r L u r l r t l r ! ( d l l y

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decade, Jacques Delors declalmed thatEurope should be allowed to defend itself.He railed against bankers doingwhat theyliked to the detdment of currencies andeconomies, going so far as to propose thatrules be set by the European Communityto curb speculative behavior. During a re-cent G-7 summit, French PresidentJacques Chirac went further and describedfinancial traders as the "AIDS of the worldeconomy", and cal led for "control led

g loba l i za t ion . " German Chance l lo rHelmut Kohl picked up the cudgels andalso advocated tighter controls on finan-cial and money markets, but could notmake headway against determined oppo-si t ion from the US and Bri t ish govern-ments.

In the neantime, even the main Pro-ponents of open malkets, namely Wa11Street and the US Treasury, have becomepainfully aware that unfettered flnancialand capltal flows have not always providedthe beneficial effects touted by open-mar-ket supporters. While remalning support-ive of liberalized trade of goods and ser-vices, they are now mulling possible waysro keep the predators at bay. East Asiaawaits with bated breath. I

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Total eclipse of gtobal economies: Will Alan Greenspan reduce interest rates to make thedollar less attractive as a refugee currencyT

46 The Asian Manager I September-October 1998

By Mila Lea C. Fener

wewwMwGet-TOGTTHER

The key to family corporationmanagement, say the experts,is "letting go and taking charge"

event-a handing over of control, a trans-fer fiom one leadership to another.

According to statistics on the succes-sion rate of family corporations, about 70percent of family-owned companies DONOT make lt to the second generation.Similarly, only one third of the successful30 percent will eventually make it to thethird generation. However, such figuresshould not be interpreted as a failure forthose that do not enter the 30 percentbracket. Rather, it can be perceived as thebusiness changing form.

Succession PlanningHampton stressed that as the company

goes through the process of transition, thesenlor generation should take an activeleadership in the process, adding that itis best done if it happens over a long pe-riod of time where there is discussion,planning and thinking. The ideal timefiame is a period of at ieast 10 to 20years.This means that even as the personwho takes over the company is consoli-dating his leadership, he is already think

ing of what's next, that is, how does heset it up so that if he will have childrenwho wiil run it, how can he make it pos-sible for them to be there?

There are cases when he is reluctant togive up control. But the challenge of suc-cession in this case is to convince him thatfor the business to continue to be success-ful, he has to give it up. He must see theneed to al1ow for different leadership models and styles to emerge in the company.

The senior generation's dilemma in theevent of succession is finding the idealsuccessor. Hampton describes this ideal assomeone who loves the business, knowsit well and can control the ownership part.The choice must be someone who reallywants the job and has earned respect-aclear choice among all the different stake-holders. As such, he must fit the strategicneeds of the business.

She adds, "There are two sides to thismanagement di lemma. on the oldergeneration's side, the key is letting go. Forthe younger generat ion, i t is takingchalge."

tat ist ics show that abour Q5 per-cent of all the businesses in theworid are either family-owned orprivately held companies. Both fuel

their countries' economies and both facesimilar problems as well as situationsunique to each. A dilemma shared by allfamily-owned corporations is the transferof control or leadership fiom the seniorgmeration to the next. How should thetransition go about without affecting thecompany's performance and viabiliry?

Dr. Marion McCollom Hampton of Bos-ton University, and Dr. Jacinto Gavino, Jr.of the Asian Institute of Management, inthe Management Forum co-sponsored byMakati Business Club, BusinessweeN andAIM offer some answers.

Hampton said that as families in busi-ness together proceed fiom the presentgeneration to the next, continuity and suc-cession are interchangeable in the process.Continuity refers to the sense of processtha t f inds the bus iness conduct ingsmoothly over a period of time. Succes-sion, on the other hand, refers to an

September-October 1998 | The Asian Manaper 47

Letting go remains to be the biggestchallenge and resistance.There's always adesire to accomplish more. It's never theright time to retire. It is very difficult towalk away from an enterprise where onehad spent so much time and energy build-ing it.

Retirement StylesHampton cites four different retirement

styles identlfied from various research con-ducted. One is the Monarch, the personwho never retires, the one who feels thatthe day he stops working is the day hestops living. It is a very difficult retirementstyle as far as succession planning goes.Another is the General, the person whoacts like he is retiring, and chooses a suc-cessor and then flnds all the reasons whythe successor is not doing a good job andcomes back in and takes over again. Thethird is the Ambassador, the person whomakes a smooth exit and is available forconsultation. This is the positive model-somebody who plans ahead, turns it overand then leaves communication linesopen. The fourth is the Governor, some-body who leaves fust abruptly. When heis gone, he's really gone and you're on yourown. That person goes off and does some-thing entirely different.

Gavino's point of departure was under-standing family corporations as being nodifferent fiom other businesses. To betterappreciate family corporations, one must

have a better handle of the dynamics ofthe faml1y businesses first.

Gavino tackled problems encounteredby Filipino family corporations. He saidthat conflicts are present withtn the cor-porat ion. On the one hand. there is thefamily that wants to nurture, support andprotect. On the other, there is the busi-ness in which competence and merit areimportant. As these roles and interestsconverge, problems arise as family mem-bers often fail to understand which hatthey are wearing when they make a state-ment. Again, the segregation of businessfrom family issues remalns an importantstep in handling and understanding theproblems they face.

Hampton adds il is necessary to keepthe relationships in the business at theprofessional level and the family issues outand into an arena that can be dealt withas a family, which is also a step towardprofessionalizing. Professionalizing thefamily business means understanding thatthe business must be run according to pro-fessional standards and not allowing toomuch of the family matters to get into it.

Gavino says that in many family firms,there exist unclear organizational roles.When the son speaks, does he speak as amanager of a particular department, as apart-owner, or as the son of an owner? Thedifficulty also lies in other people who can-not tell which hat the family member iswearing at the time.

It is necessary

to keep the

relationships in

the business at the

professional level

and the family t'ssues

out in an arena that

can be dealt with

as a family

Gavino adds that there's also a problemwhen the founder is very successful andcannot change with the times because hehas become too reliant on tradition, is con-seryative, and lacks innovation.

r . , - r ̂ - i * ^ ^ . 1 ^ - f i . + h e i s s u e o f i n d iJ U ) L d J I l l l P U l t d l r L l ) L

viduation, which is very much embeddedin the Filipino family. In the Philippines,the close-knit famlly hatdly allows childrenautonomy.

The family business does not view com-pensation simply as a Human Resource(HR) issue. The compensation to a child isseen differently from the compensationgiven another member of the business. Itis interesting to note that situations likethis very clearly shows how family dlnamics affect business management.

Succession RulesSuccession, in this context, is undet-

standing who takes on the tole of thefounder, the pafiarch or the matriarch.The successol was traditionally the flrst-born son, otherwise known as the primo-genitor. Inheritance issues arise when thebuslness is big and there is a problem indeciding which child is going to handle acertain part of the business, or a familycorporatlon so blg it becomes a conglom-erate.

Hampton says a family corporation is acomplex and complicated entity, and thatplans and important advisers can be help-fui. A willing and prepared next genera-tion is essential. But it all starts with some-one who helps succession happen. it allcomes back to leadership, fiom the peoplemost affected who are now in charge toset the example, to start the planning, tostart the conversations and to allow thetransition process to run smooth. I

What is the future of the Asian family conglomerate in the changingworld economy?

The Conference Board of America Inc. and the Asian Institute ofManagement will answer that question-and more pertaining to thefamily corporation-at a Senior Executive Forum on Oct. l-2,1998, atthe Peninsula Hotel in Makati City. The theme of the important two-day conference is "The Asian Family Conglomerate in Transition: Is-sues of Succession, Professionalization and Governance. "

Among the conference speakers are AIM's Washington SyCip' FilAlfonso, Patricia Denise Lopez, Francisco L. Roman, and JacintoGavino; Oscar M. Lopez, Chairman and CEO, First Philippine Hold'ings Corporation;Jaime Augusto Zobel de Ayala, President, Ayala Corp;and Khun Chanin Donavanik, executive director, Dusit Thani PublicCompany Ltd.

conference participants are encoufaged to engage in roundtablediscussions. The conference itself is intended for chief executives'presidents, chairmen and managing directors of multinational firmsand family conglomerates.

48 '[he

Asian Manager I September-October 1998

WratlVlakes

A GOOdt ; ' ,

All leaders are not equal, but some are more successfut than others

I d e n L i f y i n g e f f e c r i v e l e a d e r s h a sI ,

I been an essent iai aspecr of human

I survival and development. We oft-i l en s rudy management leadersh ip

in specific scenarios, dissecting the qualities of the individual and components ofthe setting to learn the secrets of success-ful management. The question that lingersin many peoples' minds is "What makes agood leader?" How do we go about choos-ing good ieaders?

This is a run down on some of the theo-ries that have arisen, then gives the mod-ern version of ident i fy ing leadership effec-t iveness based on a part icular approach.

The Great Person TheoryThe belief that leaders are born as such

underlies this theory. The Great PersonTheory professes that there are key traits

that dist inguish leaders from others i i .e.the followers). Furthermore, these traitsare suppose ro be shard by ai i grear lead-ers across time and place. Thus, Lee KuanYew, George Washington, KonosukeMatsushita and Bill Gates are supposed toshare key trairs rhat make them great lead-ers. However, research (Geier, 1969)shows otherwise. There are no clear andc0nsistent differences between leaders andfollowers when it comes to having distincttraits.

The Situational ApproachResearch does suggest that those with

certain patterns of motivation [e.g. highneed for power and high degree ofselfcon-t ro i ) a re more success fu l as managers(McClelland & Boyatzis, l9B2). Second,pol i t ical leaders show a higher degree of

self-confidence and dominance than non-leaders (Constantini & Craik , 1980). Also,individuals wirh certain trairs. i ike adapt-ability to changing conditions, tend to risetoward leadership positions (Kenny &Zacearo, 1984). Thus, it seems fiom re-search that certain traits play a role in lead-ership, but are not shared by all leadersnor do they differ clearly and consistentlyfrom traits of foilowers.

The Transactual ApproachThis is rhe most accepted approach on

viewing leadershlp by social researchers.This approach has developed the role andimpact of the followers on the leaders.Leaders and followers reciprocally influ-ence each other (Hollander, 1978). Lead-ers are strongly affected by the attitudes,preferences, perception and values oftheir

September-October 1998 l he Asian Manaper 49

followers. Here, wise leaders ale thosewho are interested in and take into ac-count the feedback from the group.

l f leaders a re nor equa l , then tvha tmakes some more successful than the oth-ers in achieving high levels of performanceand morale on the part of their followers? What determines their success? Afield of research in contlngency theorleshas evolved to address these questions.

The Contingency ApproachFred Fielder ( 1 978) fitst developed the

first of the contingency theories. He de-veloped a personality scale called the "es-

teem for the Least-Preferred Co-worker"or LPC sca1e. A person is asked to ratesomeone he or she had difficulty withaccomplishing an assigned task. A per 'son who rates this poor co-worker verynegat ive ly shows a h igh concern fo rachieving tasks successfully and is thuscategorized as "task oriented". Someonewho rates the difficult co-worker relativelypositively is more concerned with the in-terpersonal versus task aspect of the situ-ation and is categorized as "relationship-

oriented." Who is more effective as a

l p a d p r ) W p l l i r d p n e n d s . . . o n t h e s i t u a -

tion.Leadership effect iveness. measured by

the leader 's group performance, is depen-dent on the leadership style and the siruational control present. Situational con-troi has three features:

I r Ieader-member relat ions-trust andsupport of followers for the leader

2) Task structure-degree goals and pro-cesses are cleatly defined

3) Position power-leader's formal au-thority to punish and reward followers

Task-oriented LeadersTask-oriented leaders do best when the

si tuar ional control is ei ther low or high.In low situational control scenarios, theygive guidance and directron that is muchneeded by the group. In high situationalcontrol, task-oriented leaders tend to takea more relaxed and hands-off style that isappreciated by the followers. However,in scenarios where there is more situ-ational control, research shows that thetask-oriented leader may be viewed as au-tocratic and directive. thus eliciring a nega-tive reactlon fiom the followers.

The study of

leadership

scenarios help

unlock the secrets

of successful

leadership,

which in turn

help avoidperformance

failure due to

mismatches in

leadership style

and scenario

Relationship-oriented LeadersRelationship-oriented leaders tend to do

well in moderate situational control sce-n a r i o s b e c a u s e t h e i r i n t e r p e r s o n a lapproach works effectively in mixed con-d i r i n n c . n r n r r i d i n o c r r n n n r r i n s i i t i n q

through ambiguous tasks and procedures,or gaining worker trust and support toful f i l l tasks. However, they are not aseffective when the situation control iseither low or high. In low situation con-trol scenarios, the relat ionship-or ien-ted leader may not provide enough spe-cific guidance and direction in accom-plishing the task necessary. In high situation control scenalios, this leader's incli-nation to ptovide guidance to the follow-ers is seen more as meddl ing by thefollowers.

Keeping Fielder's work and contlngencytheories in mind in examining leader-ship scenarios helps unlock the secretof understanding successfui leadership ex-periences. It can also help avoid perfor-mance fai lure by avoiding mismatchesin leadership style and situational controlscenarios. I

Texl and jl lustration reprintedwi lh permis \ inn f rom:AIM Alanatentertl lortrrtalApr i l I oo8" W h a t M a k e s a l e a d e r "

By Abe Sv(ljp, pp. 3 .1

r r r Low LPC Leader (Task-oriented)

Moderate

SITUATIONAL CONTROL

50 The Asian Manager September-October 1998

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