Articles, essays, and talks of Rey Lugtu

(Published in the Special Edition of Focus for the 44th World Conference of the International Association of Financial Executives Institutes, October 15, 2014)  Relationships are the backbone of any business, more so in this regional and global economy. Many of these relationships are initiated, maintained, and nurtured at professional networking events. As Metcalf’s Law describes it - the value of a network is proportional to the square of the number connections. Accordingly, the value of your network is related to its size. The value of these events comes from the ties you build - both weak and strong - with a wide array of professionals, beyond just your clients; hence, the value of events like this comes from the connections you build, may it be weak or strong. By engaging with delegates, speakers, and even the organizers of this event will give you valuable insights about the market, prospective partners, competitors, potential employees, and even potential employers ...

(Published in Business Mirror under Free Enterprise column, March 2, 2012) NEXT week, I will be attending a week-long executive education on business, management, and leadership in Singapore. As an adult learner, I am one of those business executives who are sent by their companies to business school and training camps to learn new skills and knowledge, with the objective of applying these on the job, ultimately resulting to enhanced business results. Companies spend tons of money in running training programs. But are companies getting their money’s worth? Are management training programs effective? What if two competing companies used the same training program with the same approach and content? Who will eventually have the advantage? Trainings and executive education are not as effective due to a number of factors: inadequate training materials, lack of qualified trainers, deficiencies in program design and evaluation, excessive reliance on conventional techniques, and others. ...

(Published in Manila Standard Today under the Greenlight Column, February 6, 2012) On January 18, more than 150 million of Wikipedia’s daily users were caught by surprise when they were met with a message: “Imagine a world without free knowledge.” For 24 hours on that day, the site was on a ‘blackout’ in protest of the Stop Online Piracy Act and Protect Intellectual Property Act, which are being taken through the US Congress. No to censorship Other popular sites did not follow suit but posted protest messages on their sites. Google hosted a black patch on its US site and a message urging US lawmakers not to “censor the Internet.” Facebook founder Mark Zuckerberg wrote on his Facebook wall that his company was against the censorship law and urged Americans to further lobby congressmen about the issue. About 7,000 smaller Web sites either joined in the blackout for the day or posted some kind of protest. At 5 a.m. of January 19, Wikipedia service was back and claimed victory, spo...

(Published in Focus, newsletter of Financial Executives of the Philippines, January, 12 2012) Philippine business in 2011 was rife with gains, as well as losses. Some are outright disruptive in business, others are simply entertaining. What matter is that companies and business executives learn from the challenges of last year, and do better this New Year ahead. I have listed top five newsmakers in 2011 that, in one way or another, touched our professional lives and personal lives. Top of my list of newsmakers in 2011 is the real estate boom which the country has been experiencing these past few years and will continue through 2012, according to real estate advisory firm CB Richard Ellis Philippines. The surge in the industry is brought forth by expansions in business process outsourcing business, and rise in condominium developments. Interestingly, the CBRE data and forecasts somehow contradict the CNBC list of the 10 most difficult countries to do business in from 50 of the w...

(Published in Business Mirror under the Free Enterprise column, January 11, 2012) IN 2008, I wrote an article in BusinessMirror titled “Can outsourcing be stopped?” where I mentioned Barack Obama’s repeated spiel in his campaigns that, if elected, he would discourage companies from “shipping jobs overseas” by taking away tax breaks, or by giving benefit to those corporations that keep jobs domestically. From then on, the US government did not have a clear policy on outsourcing; thus, the business process outsourcing industry in the Philippines and elsewhere like India still experienced spectacular double-digit growth, helping spur the economies of the two countries. But just last week, President Obama jumpstarted an effort to urge US business leaders to keep jobs at home instead of outsourcing them overseas as he rolled out a new election-year theme aimed at courting middle-class voters. This has been the long-standing campaign of the US government against outsourcing, which was...

(Published in BusinessWorld under the View from Taft Column, October 26, 2011) My 16-year-old daughter, Frances, eagerly attended the Young Entrepreneurs Summit held at the World Trade Center last September. Thousands, including students, converged in this laudable undertaking aimed at encouraging entrepreneurship among the youth. Interestingly, she along with friends also attended the Franchising Expo in SMX Convention Center during the same period. She was one of the few kids who attended that exhibition which was intended for prospective franchisees. Studies have shown that entrepreneurial qualities, such as initiative, autonomy, risk taking, creative problem solving, and high internal motivation to succeed, emerge in children at a young age. I first discovered these qualities in my daughter when she was five years old, when she wanted to buy food in school and she didn’t have money. She got a Vick’s Vaporub ointment accidentally stashed inside her schoolbag by her yaya, and p...

(Published in Manila Standard Today under the Greenlight Column, August 1, 2011) Every time I drive through MdDonald’s or Jollibee to buy my 5-year old son a burger meal, it’s always heartwarming to see the use of paper bags instead of the lowly plastic bag. In Pasig City alone, more than 320 “quick service restaurants” (QSR) including fast food chains such as have started using paper bags for takeout. The new symbol The paper bag has become the symbol of a new environmental revolution that’s sweeping the country and the world over. Conversely, the plastic bag has become the symbol of environmental scourge. In January this year, the city council of Muntinlupa passed an ordinance prohibiting commercial establishments from using plastic bags and styrofoam. Los Banos likewise followed and other municipalities might follow. Several malls owners have implemented a “no plastic bags’ day” once a week to lessens the use of plastic bags, which Malacanang expressedly supported. The De...

(Published in Business Mirror under the Mirror Image Column, June 20, 2011) It’s all over the press. News Corporation Chairman Rupert Murdoch has obviously metamorphosed from a venerable media mogul to a subject of assault from all sides. Murdoch shut down the 168-year-old News of the World last week after it was accused of hacking and eavesdropping on the phones of politicians, murder victims and other famous personalities. There were also reports and revelations of cover-ups and potential bribery of the police, the resignation of top Murdoch executives and the death of a whistle-blower. A scandal of this proportion is rife with invaluable business, management, and leadership lessons that we can learn from. Clearly, ethical conduct is one of them. It’s obvious that eavesdropping on other people to get information and publish it is absolutely unethical, not to mention the reported police bribery to cover up. But what is glaring is the gap between what Murdoch is publicly preach...

(Published in Manila Standard Today under the Greenlight Column, June 20, 2011) More than 360,000 of Citigroup Inc.’s U.S. credit card customers’ data was breached by hackers according to a statement of the bank posted in its website. This is the latest of the string of large-scale hacking and data breach against high-profile companies, and the cost to them is becoming staggering. In April, Sony’s Playstation Network was attacked by hackers which affected more than 100 million online accounts. Sony expects it will cost it ¥14 billion (US$170 million) this financial year. Earlier this month, Google blamed China of trying to hack the accounts of several hundred of Gmail account holders that included U.S. government officials, journalists, and Chinese human rights activists. These statements from Google could seriously hurt its business. In fact last year, the Obama administration took up Google's complaints about hacking and censorship from China. Afterwards, Google partially...

(Published in Manila Standard Today under the Greenlight Column, April 18, 2011) A local bank recently invited me to deliver a talk to its senior executives about managing change and transitions. This is opportune time for the bank as it is undergoing changes and its attendant transition in areas of strategy and organizational structure changes. My talk centered on how to manage transitions in particular as opposed to managing change. There is a distinct difference. Change is situational, an event. It happens when something starts or stops. Transition is psychological. It’s a psychological process that a person goes through to detach from his/her old identity and become directed to a new one. Transition takes longer than changes, and this is where the complication comes in – the roller coaster ride of emotions involved among those affected by the change. These are the wisdom behind the seminal book of William Bridges, “Managing Transitions”. It was an interesting talk because I r...

(Published in Business Mirror under Mirror Image column, April 13, 2011) Another round of oil-price increase! The Department of Energy (DOE) confirmed this on Sunday due to the continuing rise in global crude prices from $4 to $5 per barrel. If this pushes through, this would be the 12th time oil companies increase their price since the year started, as the unrest in the oil-producing countries of the Middle East continues to escalate. This is the perennial dilemma of our country as an importer of fuels and oil for our energy needs. It means that when the price of oil increases, Filipinos have to bear the brunt of the upward spiral of fuel and power costs. It is opportune time for the government and the private sector to focus on the development of renewable energy (RE). Using RE means that we use energy sources that are not clean and reliable, but sustainable, such that it addresses our country’s problem on energy security. Since the signing of the Renewable Energy Act of 2008,...

(Published in Business World, under the View from Taft column, April 7, 2011) The Fukushima nuclear disaster and the rising oil prices have highlighted the huge and promising potential of renewable energy (RE) around the world and in the region. A raft of news reports on companies investing in RE fill the national dailies almost every day since the start of the year. Since the signing of the Renewable Energy Act of 2008, we have seen a deluge of investments in hydropower, wind, biomass, ocean energy, and solar power. The latter deserves special attention as we see massive deployments of it this year. According to the Philippine Solar Power Association (PSPA), solar power producers are expected to generate a combined 125 MW this year, 130 MW in 2012, and another 95 MW by 2013. One major player is Lopez-led First Philec Solar Solutions (FPSS), which plans to build a solar power plant in Cavite that is projected to deliver 2 megawatts and is scalable to 5-MW in the coming years. The...

(Published in Business Mirror under the Mirror Image column, March 15, 2011) A few hours after the horrific tsunami in Japan, people all over the world flooded Facebook and Twitter with entries trying to communicate to loved ones affected by the catastrophe. Many postings expressed prayers and concern, along with news about friends and relatives in Japan. The social-networking sites also became an invaluable source of information among relatives of Japan migrants on immediate news and real- time updates about the situation and emergency warnings. Corollary to these, a number of Facebook causes have helped raise huge sums of money for Japan’s tsunami victims. The American National Red Cross, through Facebook Causes, has so far helped raise $75,825, donated by 1,770 people aided by 3,757 promoters. The Northern Japan Earthquake Relief Fund, on the other hand, has so far raised $21,611, through 2,104 members through Facebook Causes. In stark contrast, abject indifference and utmos...

(Published in Manila Standard Today under the Greenlight Column, January 10, 2011) I was recently invited by a Communications Arts class of De La Salle University to talk about the ill effects of Facebook among the youth. “Ill effects among the youth?”, I asked. I have studied the good, the bad, and the ugly sides of Facebook in the workplace. We always see its good side because most of us are active users. But the dark side in the work place is apparently the decline of productivity based on a number of studies. But understanding the ill effects among the youth struck me because I have two teenage daughters who spend hours in the veritable social network site; and I oftentimes ask them to stop and instead concentrate on studying. So this topic interested me as I wanted to understand its potential ill effects to my kids. Surveying Facebook users To put some credence in the talk, I asked the student organizers and my daughter to help me to conduct an exploratory study through a...

(Published in Business Mirror under the Mirror Image Column, January 5, 2011) I attended the silver reunion of Batch ’85 of the Manila Science High School on December 29. The ice-breaker the organizers ran was a rock-paper-scissors (RPS) game. This entailed pairs from the 30-plus who attended the reunion to run one round of RPS, with the loser giving P20 to the winner. The winners in the previous rounds were then pitted against each other, and the winnings were given to the victor of the succeeding rounds, until finally there was just one big winner with over P1,000 in prize money. Being a confessed ex-geek, I knew there was a strategy in this game and not pure chance. I read some studies on RPS that the most likely choice of a player was scissors. So my strategy was to always choose rock in the first round. True enough, during the game, I won several times using the rock strategy, until finally only Jude, a batchmate, and I were left. Unluckily, I succumbed to my opponent’s supe...

(Published in Business Mirror under the Mirror Imgae Column, October 19, 2010) After four gruelling years in high school, my eldest daughter is, at last, graduating and entering college. I’ve been trying to prod her to take up entrepreneurship or entrepreneurial management because of her knack for selling things and making money since she was four years old. But, surprisingly, she wants to take up fashion design or interior design. It’s not too bad because she said she wants to put up her own business designing clothes or homes. What is more surprising is that she said the majority of her classmates are taking up arts and hospitality courses—from culinary arts to hotel and restaurant management. This struck my incurable curiosity, and I did my own surveys. After talking to friends and colleagues, they confirmed that, indeed, kids these days are taking up arts and hospitality courses in college apart, of course, from medical technology and nursing courses. The latter courses are u...

(Published in Business World under the View from Taft columng, October 13, 2010) On October 9, I attended the Manila Science High School Grand Alumni Homecoming, where my batch mates and I (Batch ’85) were the Silver Jubilarians. The mood was festive as batch mates, classmates, and friends mingled the whole afternoon until a night of singing and dancing. Our batch had the most attendees, with 50 of the 270 who attended. This high attendance can be attributed to the tight network that our batch had established. From the simple beginnings of an e-mail group in the early 2000s, our network has evolved into a more sophisticated Facebook account. Our network has cultivated not only personal relationships but also business and professional connections. The benefits of social networking to professional life or to the workplace may not be clear to many companies, but they are many. Social networks allow organizations to reach out to and target select groups and individuals. Many sales an...

(Published in the Manila Standard Today under the Greenlight column, September 6, 2010) I recently attended a business meeting in Thailand where colleagues from Asia Pacific countries gathered to present and discuss business priorities. A favorite dinner staple topic among my colleagues was the hostage crisis in Manila. But more interestingly was the observation of many on the speech delivered by President Aquino to the local and international press where he smiled instead of showing grief. Having read the explanation of President Aquino, I quickly defended him. I told everyone that the president’s smile has been misunderstood – he was smiling because of the absurdity of the situation with the police using a sledge hammer and the difficulty of breaching the bus. I also told everyone that the President apologized for having offended certain people. This makes us realize the importance of understanding nonverbal communication in diplomacy and international business. According to st...

(Published in Business Mirror under the Mirror Image column,July 13, 2010) I was listening to a morning AM radio program as the commentators were discussing the latest mandate of President Aquino to stamp out jueteng, coming from a report that the small-town lottery was just a front for illegal-numbers game. Then the commentators interviewed former President Joseph Estrada, where he pointed out that all previous presidents—from the time of President Cory Aquino—wanted to stop jueteng, but all ended up in futility. It was only former President Estrada who wanted to legalize the numbers game, and legitimize the employment of more than 200,000 jueteng minions and for government to collect billions worth of taxes. After hearing the radio-program discourse, it dawned upon me how gargantuan a task President Aquino is facing to eliminate jueteng after failed attempts from past administrations. Jueteng has become so institutionalized in our society that controlling it seems impossible. H...

(Published in Business Mirror under Mirror Image column, June 23, 2010) Sixty thousand barrels of oil a day, according to US government estimates, are being spilled into the ocean as a result of the Gulf of Mexico oil leak, which started in April. According to senior officials, this is the worst environmental disaster the US has ever faced, and there is no end in sight until relief wells come into operation, probably in August. British Petroleum, which operates the leaking oil well, said the disaster has already cost it $2 billion. The number of claimants, standing at 64,000, is still growing as the oil continues to spew from the broken wellhead. The damage to the environment will entail huge amounts to repair. In the investigation of the US House of Representatives, BP’s CEO was accused of being oblivious to the risks of his company’s deep-water operations; he said he was “deeply sorry” for the catastrophic Gulf coast oil spill. A closer look at the root cause reveals a combin...