Acquisitions, synergy, and technology headline Aboitiz Group’s Great Transformation

From left: Aboitiz Equity Ventures’ Chief Synergy Officer Eduardo “Dudes” Aboitiz, Chief Strategy Officer Chris Beshouri, and Transformation Head Dea Franko-Csuba discussed Aboitiz’s transformation journey and the next steps to evolve the Group into the country’s first techglomerate. Onstage with them is Master of Ceremonies and UnionBank Co-Brand Product Manager Jerrica Pastor.

The Aboitiz Group reinforced its transformation goals for 2024 and beyond as it put its partnerships, acquisitions, and interbusiness opportunities front and center during its 8th annual Leaders Conference (LeadCon) held this month. Over 500 Aboitiz leaders gathered for the conference at Solaire Grand Ballroom, where the Group not only unveiled its growth strategies, but also presented its cutting edge innovations including its first pair of AI-powered virtual team members.

With the LeadCon’s theme ‘Unlocking Techglomerate Potential’, the Group took stock of the steps that have been taken in recent years in order to transform itself into the Philippines’ first techglomerate. As the Group experienced massive growth in recent years, it is poised to form a sustainable business ecosystem among its many diverse companies that will become the core of its strategy in the coming years.

Aboitiz Group President and CEO Sabin M. Aboitiz called on Aboitiz Group leaders to be models and spread the values of transformation to their teams.

The Aboitiz Group is in the third year of its Great Transformation initiative, with everything from its culture, to processes, to technology evolving at a rapid pace. Aboitiz Group President and CEO Sabin M. Aboitiz emphasized the need for team leaders to imbibe the value of transformation and be the examples for their team members.

“Our people will never change unless our leaders do, and our leaders will never change unless they know why they’re doing it and why it’s important. It’s our responsibility as leaders to make sure everyone is supported. When we genuinely care about our teams, we create a leadership that inspires more than motivates,” Sabin Aboitiz said. 

Sabin Aboitiz added that the LeadCon is an avenue for the Group’s team leaders to learn the key factors to unlocking techglomerate potential for their teams — namely strategy, synergy, and transformation — directly from Aboitiz’s top brass. Each key speaker in the event offered a view of the Aboitiz Group’s transformation journey and the opportunities that lie ahead.

Chris Beshouri, Aboitiz Equity Ventures’ (AEV) Chief Strategy Officer, presented how the Aboitiz Group has rapidly transformed in the last decade after divesting its shipping and transport business. In such a short timespan, the Group has expanded to become a major conglomerate, diversifying its business interests with big-ticket acquisitions such as Citibank’s Philippine consumer banking business, the operation and management of the Mactan-Cebu International Airport, and a 40% stake in Coca-Cola Beverages Philippines, Inc., among others.

The Group has also entered into major partnerships. One is with Japan’s largest power generation company JERA, and a separate partnership with Meralco PowerGen and San Miguel Global Power Holdings for the country’s first and most expansive integrated LNG facility in a deal worth $3.3 billion. In just three and a half years, the Aboitiz Group had entered into P255 billion worth of deals. According to Beshouri, this is the clearest sign yet of the Group’s transformation.

“The goal of transformation is to have impact. And the potential for this Group to have economic impact is enormous. If you add up the market value of the (Aboitiz) Group, we represent an estimated 4%-5% of the total PH stock market capitalization as of 2023,” Beshouri said.  

Meanwhile, Eduardo Aboitiz, AEV Chief Synergy Officer, discussed the important role synergies will play in the pursuit of the Group’s goals. Eduardo contextualized synergies as activities wherein Aboitiz businesses work together, enhancing value creation and making the whole Group to be more than the sum of its parts.

He shared that the Group is not starting from scratch. The Aboitiz story began with abaca production. From abaca, the Group started producing rope and mainly selling this to the shipping industry — which eventually became the Group’s flagship business for over 80 years.

Today, the Aboitiz ecosystem is wider, resulting in more synergy opportunities. A straightforward example is AboitizPower (AP) reliably providing 100MW of competitively-priced power to its sister companies such as Republic Cement, Pilmico, UnionBank, Aboitiz Infracapital, and Coca-Cola. The Group also leverages on synergies to strengthen its Economic Estates. The Group combines its various assets such as power, water, construction, and banking to create a stronger offer to estate locators, enhancing value for all parties involved.

There are other initiatives being pursued. Still, despite these, Eduardo emphasized that massive opportunities remained untapped. He challenged everyone to maximize synergies and integrate the thinking in every team member of the Group.

“Synergies do not start and end with the people in this room. Everyone can contribute. As we embark on this journey, we will start to see more connections appear. When we maximize these connections, that’s when we can become a fully-integrated ecosystem and be fully transformed,” he said.

The Group’s businesses are not the only ones called to transform, but the individual team leaders as well. AEV Head of Transformation Dea Franko-Csuba called on the leaders to be adaptive and open to technologies, processes, and behaviors that can improve themselves, their teams, and the business. She cited the need to embrace emerging technologies that will assist teams in automating and optimizing work processes, such as artificial intelligence (AI).

“The Transformed Aboitiz Group is not an end destination. The future of our industries is unfolding in front of our eyes and we have to constantly reimagine ourselves on the fly. To build an adaptive, intelligent organization, we need to change the way from command and control leadership to an agile, empowering leadership style, where the leaders define where we are and where we are heading but the team figures out how to get there as a collaborative effort,” Franko-Csuba said.

Transformation Head Dea Franko-Csuba (rightmost) unveils Elsie and Albert, the Aboitiz Group’s first virtual team members.

As a highlight of her discussion, she introduced the Aboitiz Group’s first-ever virtual team members, Elsie and Albert. The AI avatars were presented onstage, and gave helpful summaries of the presentations throughout the conference. They were also available to answer queries outside the event entrance, showcasing the ability of AI to assist the leaders and their teams. 

The LeadCon also welcomed guest speaker Michael J.T. Steep, Founder of the Stanford University Disruptive Technology Program, who cited the need for innovation to facilitate transformation. He advocated for the use of AI in order to assist in the growth of businesses, and encouraged leaders to not only focus on being efficient workers, but also to foster people and networking skills to find the experts that their businesses need.

The Aboitiz Group’s Leaders Conference gathers team leaders from across the Group’s various business units in order to set direction and strategy as well as share best practices and achievements within the Group. This year’s conference makes a return to a grand in-person event after several years of being held virtually or on a hybrid basis.

Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.

Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.