JG Summit President and CEO Lance Y. Gokongwei shared his thoughts on running one of the largest and most diversified conglomerates in the Philippines and the factors determining its sustained business success in the Asia-Pacific region during a recent interview with the Boston Consulting Group.
A portion of Gokongwei’s Q&A, wherein he spoke about the conglomerate’s corporate culture, being disciplined about diversifying the group’s portfolio, creating shareholder value, and empowering the organization’s employees, was recently published on BCG’s LinkedIn page as part of its “Asia Leaders Speak” series.
Asked to name the three factors that have most contributed to his successful steering of the conglomerate, Gokongwei pointed to having the right team, knowing which industries or sectors to compete in, and creating the right corporate culture.
“First, assembling the right team, that shares and drives your culture and purpose,” said Gokongwei, is already “half the battle won.”
In elucidating the second part in his formula for successful leadership, Gokongwei says it is critical to know where to play, “choosing the right industries where you can earn sustainable returns, make reasonable profits and continue to grow; and where you can be the ‘natural owner’ for your business.”
Keeping this in mind enables Gokongwei to take a disciplined approach to handling the group’s business portfolio, focusing on industries where it has the potential to lead, and exiting certain businesses when necessary or when they are no longer aligned with the corporate vision.
Those familiar with how the conglomerate is run know that it prizes the Entrepreneurial Mindset, Stewardship, and Integrity—three core values that encapsulate what Gokongwei calls “the founder’s mentality.”
Though firmly anchored on these values, the conglomerate is moving toward the future by embracing digitalization, becoming more agile, and less centralized. “With growth, it becomes increasingly important to have a more decentralized organization that is aligned with you by way of incentives and culture. As a leader, you need to have a strong point of view. At the same time, you have to make people feel like they are leading their own business,” said Gokongwei.
He added, “Creating employee value is important to us. We focus actively on maintaining high engagement, and low turnover.”
In ensuring the sustainable growth of the conglomerate, Gokongwei again emphasized the importance of the entrepreneurial mindset, but also noted that “Agility, collaboration, dealing with ambiguity, quick decision making, and experimenting and failing fast” are necessary in today’s environment. Staying constant for the group is its commitment to customer-centricity. According to JG Summit’s president and CEO, the focus on the customer “is more important now than ever before.”
This was underlined when Gokongwei was asked about the advice he would give to less experienced CEOs. “Listen to the customer,” said Gokongwei.
BCG’s full report, which features 10 CEOs from high-performing companies in Asia, is slated for release in March. According to Neeraj Aggarwal, BCG Chairperson for Asia Pacific, “Close to one-thirds of Global Fortune 500 companies, nearly one-thirds of the world’s unicorns, and three out of seven global patent grants now come from Asia, excluding Japan.”
Despite this, argues Aggarwal, leadership in the Asian context remains “less understood,” with the narrative often shaped by the West, which is not often applicable to businesses in Asia. The “Asia Leaders Speak” series seeks to rectify this situation, bringing a decidedly Eastern-centric view to the fore.
Aside from Lance Gokongwei, the BCG “Asia Leaders Speak” series features Sanjiv Bajaj, chairman of Bajaj Finserv; Xiaohai Hou, CEO of China Resources Beer; Aloke Lohia, founder and group CEO of Indorama Ventures Limited; Jeffrey Minfang Lu, CEO of China Mengniu Dairy Company; Sanjiv Soshil Mehta, chairman and managing director of Hindustan Unilever Limited; Miranda Qu, founder of Xiaohongshu; Jahja Setiaatmadja, president director of Bank Central Asia; Dr. Kiran Mazumdar Shaw, founder and executive chairperson of Biocon; and Wei Wang, founder and chairman of SF Holdings.
Read more from the Boston Consulting Group’s interview with Lance Y. Gokongwei here.