Rex Drilon: Staying focused amid crises
By Judith Balea, abs-cbnNEWS.com | 05/30/2009 10:46 AM
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This is part of our series on the country's movers and shakers in business. Profile stories under"My Biggest Mistake and How I Solved It" portray individuals who have reached a certain level of success, not just by mere luck, but through failures or rejections that helped shape them.
When Rex Drilon II assumed his post as chief operating officer of a wealthy Filipino family's business in 2000, he had to hit the brakes and park the company for an overhaul, before he pulled a major turnaround.
Turning Ortigas & Co. Ltd. Partnership around was a huge challenge for the seasoned executive even if he has engineered a number of corporate rehabilitations in the past. Since he knew first hand that there was no perfect formula for it, Drilon just stayed loyal to his list of work and personal goals.
His first goal was to restructure and modernize what was then an old-fashioned Ortigas, which had 300 employees who were of retirement age, and only about 3 computers with nothing but illegal software installed.
Drilon practically shook things up to catapult the firm into the 21st century.
"It was hard. It had to make a lot of difficult decisions if I wanted to bring in change and create more shareholder value," the 62-year-old COO said.
Without dilly-dally, he retired all employees and brought in more handpicked people who could help him carry out his master plan for Ortigas.
He knew the massive layoffs might give him an internal public relations nightmare, especially because most of the workers had already developed an emotional attachment to the company after having stayed there for 40, some 50, years.
But he said he did what he had to do. And he was prepared.
"I knew there will be violent reactions. I sympathized with them and took the trouble to personally explain to them and educate them about the needs of the company, primarily the need for new talents. The personal touch helped a lot," he said.
Luckily for him, too, Ortigas' remodelling came with a blank check. He was able to hire a top calibre consultant to help him with all the transitions.
He gave the retirees handsome benefits--3 months salary for every year of service--creating more than 30 millionaires.
He also put up a seminar called "Life After Ortigas" to help outgoing employees adjust to their new lifestyle and teach them how best to grow their nest egg.
"Sometimes, you have to take the bitter medicine to heal and move forward. That's what I did with Ortigas."
Making the company fly
Restructuring and modernizing operations, however, were just the beginning of the challenges Drilon had to hurdle. Far more difficult was driving the company towards profitability.
Ortigas has been in the real estate scene for 76 years. It has presence in the residential and now, office space segments, but most of its business is anchored on its mall operations.
When Drilon first came in, the company's finances were in a free fall. Its revenues were down to only about P200 million annually, largely from its old and worn out Greenhills Shopping Center.
That amount was measly for a company that has been around for that long.
So he and his team went back to the the drawing board and decided it was best to tear down everything and build something bigger and better to be at par with other industry players. The hardest part of the transformation though was knowing who their markets were and what they wanted.
"We had a survey done and discovered we have a wide range of markets--ABCDE. So we decided to reposition Greenhills as something that offers more value to each of the customers," he recalled.
"We decided to put up a flea market to address consumers in the lower income bracket. And we also put high-end and classy establishments for the rich consumers."
Ortigas has since evolved into a full-blown property developer whose mall revenues alone amount to over P1.5 billion, more than 7 times what it was making before.
Unknowingly, Drilon said they were able to establish a business model that could weather crunch time. Ortigas still enjoyed an 8 percent increase in revenues during the first two months of the year despite the much-felt economic turmoil.
Track record
Drilon's turnaround story may strike some as just another tragedy-to-triumph tale. Others may think he just got lucky.
But those who know his track record consider Drilon to be a well-rounded and competent manager, who always makes sure his company operates in the black.
He hurdled years in Philtranco, which rebels tried to squeeze revolutionary taxes from by putting on fire several of its bus fleet. He also faced sagging employee morale and productivity as president and CEO of Fuji Xerox Philippines in the early nineties. The company has a history of shaky management and labor union relationship that usually resulted in deadlocks and strikes.
In Ortigas, he faced the ire of wealthy families in the Greenhills Shopping Center's adjacent posh villages when in 2004, an P8 million prayer room for Muslim retailers were included in the facelift plan for the center.
In overcoming all these, Drilon shared that "the key was transparency and personal relations, trust building. There's no shortcut to developing personal rapport."
Initial efforts were difficult, but Drilon said he capitalized on personal relationships, trust and confidence building to address the issues. In Fuji Xerox, for example, he said the possibility of a strike everytime a CBA is being reviewed was avoided through these relationships. "I found out it was best to have regular interactions with employees, share with them the financials of the company, educate and enlighten them on why their demands must be reasonable for the company," he shared.
From Fuji Xerox, Drilon moved to Jardine Davies Inc., then to Ayala Corp.'s Cebu Holdings Inc., then to Ortigas, and he never failed to create success stories.
Keeping the focus
Drilon said he wouldn't surpass the challenges in his life without a clear vision of what he wants to achieve.
He has this habit of making a list of goals, much like the one he had when he was transforming Ortigas.
Drilon keeps his list close to himself, reading it from time to time, whenever he's traveling or a client is late for a meeting.
This way, he said he doesn't lose focus and momentum.
"You have to have a very clear vision of what you want to do, what you want to be, both in your personal and corporate lives. If you focus on your goals and keep them, you can't go wrong," he said.
"My list reminds me of the things I want to do. It works for me," he added.
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