Philippine Business Magazine: Volume 8 No.2 - Cover
Managing Foreigners
A number of foreign companies are now managed by local executives
By Maricar T. Manuzon

It used to be that multinational corporations would be headed by nationals of the mother company. But now it is becoming a common arrangement that local executives take the rein of foreign companies. Thanks to the talent and expertise of local executives, foreign companies are finding it easier to entrust local operations to local guys. Among the better known cases of MNCs headed by Filipinos are Nestle Philippines with Juan Santos and Procter & Gamble Philippines with Johnip Cua. These two are among the first ever Filipino CEOs of two of the country’s largest foreign corporations. Juan Santos, in fact, not only heads Nestle Philippines but simultaneously served as Managing Director of Nestle Singapore for some period of time.

Shell Philippines' Oscar Reyes

Other MNCs which have turned over the top post to local executives include: Pilipinas Shell Petroleum Corporation (Oscar Reyes), Caltex Philippines (???), Amway Philippines, L.L.C. (Fred Pizarro), IBM Philippines (Ramon Dimacali), ING Barings (Renato de Guzman), and Coca-Cola Bottlers Philippines (Natale Dicosmo). Also, prior to his assumption as Energy Secretary, Isidro Camacho has been serving as the country manager and managing director at Deutsche Bank AG Manila.

Equally significant is the availability of a large number of Filipinos who easily fit in middle- to lower-management positions in these MNCs. Expatriates in these ranks are very few. In a Business Week Online statement, Lawrence Qua, President & CEO of Ionics — a manufacturer of computer components and the top Philippine electronics exporter — notes that Chinese labor is certainly cheaper but Filipino middle managers are more competent.

In a separate online statement, Atty. Ismael Khan, a former president of the Personnel Management Association of the Philippines (PMAP) observes that Filipino executives are among the best in Asia. He adds that Philippine managerial talent is highly prized in Indonesia, Hong Kong, Malaysia, Papua New Guinea, Brunei, Thailand, Micronesia, and the Middle East.

At Ford Philippines, top guy Terry Emrick attests to the quality of Filipino managers in his company. “They’re very good; definitely globally competitive.” He elaborates on his observations about the country’s human resources in the following story:

Terry Emrick considers the Filipino labor force to be globally competitive

Filipinos in Ford
The plan was to have 12 expatriates for Ford Philippine operation but given the expertise of local executives, the expats are down to four
Interview by Maricar T. Manuzon

The predominantly royal blue motif of the Ford Philippines compound in Sta. Rosa, Laguna is as catchy as its quiet and neat surroundings and manicured lawns. We told ourselves that this place can surely inspire a person to work hard for this company. After we met the amiable and cool American expatriate who heads Ford Philippines, Terry Emrick, we were convinced that a good company, good workplace, and good management were key attractions why the local hires of Ford are what Emrick describes as among the best in the world. Excerpts of the interview:

How will you describe your company’s Filipino human
resources?
In the management ranks, we consider the Filipino labor force to be globally competitive. Proof of that is, when we decided to come here, we had a business plan that included a large number of expats, about 24 — this is at least large compared to what we have now. But once we started hiring Filipinos, we only needed to bring in 12 expats and we are already today down to four, including me. I think you’ll find that very low compared to other international automotive companies in the Philippines. That is how you transfer technology. You don’t transfer technology by having the 24 expats here working, running the show. You transfer technology by allowing local nationals run the whole business. This means no expats, no foreigners.

Furthermore, we already have eight Filipinos, whom we’ve hired since we came here, who are in expat positions around the world, only after being employed for two years. We think they’re pretty good; they’re globally competitive. We got more Filipinos working around the world than we do have expats here in the Philippines. We got some in Taiwan and the rest are in the US. I expect more and more of that because Filipinos like working overseas. Besides, Ford Phils. is very small compared to the Ford World. As such, there are a lot more job opportunities within Ford elsewhere in the world.

Also, you will likely see my replacement will probably be a Filipino. Foreign assignment at Ford is usually three-to-five years and I’m on my fourth year. I came here in 1997 when we started doing the study. We broke ground in May 1998. We started production in September 1999.

So, you’re saying that we can expect the next president of Ford Phils. to be a Filipino?
Well, I can’t say that. I said likely. But we do expect that we will be down to like three or two expats next year. Which is very well.

Do you agree that, among other things, one distinct edge of the Filipinos is that they are English speaking?
Yes, absolutely. And we better not lose that. I don’t know why former President Estrada wants to speak in Tagalog. I’m on the American Chamber of Commerce Board and we’re saying don’t do that please. That’s a very strong advantage that the Philippines has. The language of the business world is English. Period.