Organizing for execution

Lim

Nic Lim is a seasoned people manager. He was VP of San Miguel Corp. and Director for HR of Kraft before joining Universal Robina Corp. and becoming SVP for Corporate Resources of its holding group, JG Summit.

Lim was named People Manager of the Year in 2007 by the People Management Association of the Philippines.

Here, he shares his thoughts on how to help people execute business plans.

Q: What is your typical day like as SVP for Corporate Resources?

A: How do you squeeze in an almost 10-hour workday a role that juggles three direct functions: Corporate HR, Corporate Outsourcing, Corporate Security and Safety while overseeing functionally the people doing these functions in the different Business Units in the Philippines, Asean, China & HK and Oceania?

Key is having Action Registers for all the groups—to ensure alignment and proper monitoring.

I call on bimonthly meetings to thresh out contents of these Action Registers.

A typical day for me: as I have always been a morning person, am at the office early before 8 am.

Most of my day is spent on scheduled meetings (jam-packed schedules) and walk-in meetings for urgent/emergency matters. I am always called for meetings/always on the phone with my bosses and the other members of the Excom for business discussions/decision-points.

The most important part is alignment with my bosses and my people’s alignment with me.

Q: There is a belief that HR should be the 2nd CEO or chief execution officer. What can you say about this versus the state of HR today?

A: Indeed, HR leaders are the 2nd CEOs or chief execution officers. For the past 39 years, these are my top 3 mantras:

1. Human resources is at the center of organizational transformation.
2. Behind every business issue is a people issue.
3. As we grow the business, we grow the people.

With these said, the most pivotal role of HR Leaders is to be Leader Builders. Leaders are the primary reinforcers and transmitters of culture.

They are as well the primary movers and shakers of an organization’s bottom line.

Therefore, HR should help build / develop them on these primary mechanisms:

– what they pay attention to

– how they measure and control business movements

– how they react to critical incidents and crises

– how they role model, teach and coach

– how they allocate rewards and how they    recognize

– their criteria for recruiting, selecting, promoting, and separating people

HR is transforming—it is undergoing continuous evolution to be more than excellent in HR delivery but also as reliable strategic business partners.

Q: How do you describe JG Summit’s organizational structure and how do you know it is the right one?

A: JG Summit’s current corporate governance consists of the following:

1. An Executive Committee (Excom) which provides Business Unit (BU)/Corporate Center Unit (CCU) oversight and focus on growth opportunities.
2. Decentralized and empowered Business Unit Heads.
3. Lean but high-powered Corporate Center Units.
4. Clearly defined authority limits to ensure appropriate checks and balances
5. Comprehensive audit system allowing focus on significant variances
6. Watertight operational procedures
7. Systematic and standard planning process that will generate strategies and produce firm targets. BU/CCU champion strategies/plans, Excom challenges and approves.

This has been in existence since 2002 with the help of McKinsey Consulting.

This year, starting January, we are reinforcing further the decentralization and empowerment of the Business Unit Heads as the CEO role is transitioned in three years from JLG (James Go) to LYG (Lance Gokongwei) with the appointment of presidents and CEOs/ COOs and CFOs in the core BUs and the further rationalization of the Corporate Centers.

This governance structure has been working well for the conglomerate since we are able to hit our growth targets while we ensure alignment across.

Q: When is the right time for a company to restructure or reorganize?

A: You only restructure and reorganize if a business strategy has significantly changed. In JG Summit, the red flags for restructuring and/or reorganization are our growth and business strategies:

1. Establish and maintain leadership across all of our businesses

– Strengthen JG Summit’s strategic positions in the businesses it is engaged in

– Capitalize on its entrepreneurial culture, successful track record in introducing innovative products and services, and building strong brands

– Continue to provide value to customers and consumers of its products and services

1. Maintain the strength and diversity of our business portfolio

– Continue to explore opportunities in businesses that serve large and growing markets with high returns, and where JG Summit has or can acquire, a sustainable competitive advantage

– Look for opportunities to drive synergies between JG Summit’s different businesses, and invest in new businesses that can complement or augment the strength of our current businesses

1. Continue to invest for sustainable growth

– Grow the existing businesses organically by expanding current operations, maximizing asset utilization and increasing international footprint, while looking for strategic acquisitions

1. Pursue disciplined growth into selected international markets

– Retain focus on the Philippines as its base market while looking for opportunities to diversify its current business interests in Asean, China and Oceania

What should essentially change after restructuring and reorganization are the other 5S’s in the McKinsey framework on top of Strategy and Structure, starting first and foremost with Shared Values—mindsets/perspectives especially of leaders should change to support the strategy/structure.

The other S’s should be reviewed and revisited to support the change: Systems, Style, Skills, Staff.