Aboitiz embarks on transformation journey

Businesses worldwide are all pacing for a very fragile post-pandemic recovery and they’re in that crossover while competitive playing fields of corporates are also undergoing tectonic shifts, according to a report by Manila Bulletin.

By far, the turning points for businesses have been chaotic and complicated as they also wade through consequential events such as an intractable war; the turbulence in energy markets; the ignited panic button for ‘stagflation; as well as the need for industries and economies to embrace digital reshuffling as well as transition to lower carbon emissions.

Amid these economic and geopolitical shocks, one multi-industry company in the Philippines that has been successfully traversing its ‘great transformation journey’ as a ‘techglomerate’ is Aboitiz Equity Ventures (AEV), which has businesses in power, food, banking, telecommunications, real estate and other infrastructure development platforms.

“Our Great Transformation into the Philippines’ first techglomerate sort of ties together all our achievements and goals,” AEV Chief Executive Officer Sabin M. Aboitiz shared, adding that the group “used the pandemic as an opportunity to pivot and transform” and that was also the major stimulus for their business to “continuously strengthen emphasis on people and innovation.”

Pillars to ‘techglomerate’ transformation

Aboitiz highlighted that there are four main anchors to the group’s metamorphosis as a techglomerate — these delve with: cultural transformation; technological transformation; operational transformation; and financial transformation.

“All these four pillars of our great transformation are dependent on each other, so they work in synergy across the single ecosystem of the group. So they not just affect all production centers, but affect them synchronously in the ways they are individually required,” he said.

The cultural transformation of mindsets, attitudes and behaviors, Aboitiz explained, is appended towards “a more progressive, entrepreneurial, creative, sort of startup critical thinking and acting,” while technological transformation marks off the degree “to which we take advantage of innovation and the latest technologies.”

The realm of ‘operational transformation’, the AEV CEO qualified, redefines paradigm on “the way we run our businesses to reflect this new culture and optimize these new technologies and innovations.” And ultimately, the goal of the digital trailblazer-conglomerate will be for its business model conversions to result in financial transformation or concretizing targets to post substantial hike in bottom lines.

Great strides on digitalization and decarbonization

The digitalization sphere is unequivocally a business space in which the Aboitiz group has been successfully leading ahead in the race – primarily in the acceleration of digital service offers of its Union Bank. Certainly, that is the master stroke that the group is now scaling up across its other business chains – be it with its food venture via Pilmico; in Aboitiz Power (AP); or in manufacturing and infrastructure developments.

Aboitiz indicated the transformation strategies could be underpinned by various initiatives and ventures already started by the group – including its startup Aboitiz Data Interchange (ADI); the DigitaLeap which is a ‘robotics process automation’ being carried out by Aboitiz Power; as well as the ExO Works Sprint which is the firm’s bid “to leverage disruptive technologies,” that in turn could “increase business agility, accelerate digital innovation and further cultivate a future-ready mindset within the organization.”

“The innovation explored by our 1AP sprinters were both core and edge in nature – meaning those are related to our current businesses and new potential business opportunities,” he conveyed.

The ExO Works Sprint, he noted, was designed “to guide Aboitiz Power and its select high potential team members through the process of creating repeatable innovation initiatives and processes resulting in exponential gains or up to 10 times return on investment.” – and that’s done through series of workshops and coaching sessions from reputable ExO advisors, Aboitiz Power mentors and domain experts.

In the broader network of the group’s power business, Aboitiz enthused “we also started installing operational technology (OT) cybersecurity systems to ensure that the minimum security levels are met in its power plants,” – and the proof-of-concept to this undertaking was carried out in AP’s Therma Visayas power facility.

“Ensuring plant availability and reliability not only allows Aboitiz Power to minimize losses, but more importantly, enables the company to deliver adequate and stable power supply to its customers and communities, in a responsible and sustainable manner,” he pointed out.

Aboitiz added “to effectively and efficiently and sustainably drive this transformation, we continue to strengthen our workforce by equipping them with the skills and tools necessary to boost productivity and performance.”

Another focus of the techglomerate’s transformation is on substantially trimming its carbon footprints – with an aim to rebalance its energy portfolio to a 50:50 ratio of thermal and renewable energy capacities by 2030 – and that entails adding up RE capacity investments of roughly 3,900 megawatts within the timeframe.

“We are cognizant of the challenges as far as environmental sustainability is concerned. We continue to apply the innovation mindset and launch transformative projects throughout the organization,” Aboitiz stressed.

He emphasized “our energy transition ambition is in support of the Philippine Energy Plan of the Department of Energy. We are constantly on the lookout for opportunities to increase our contribution to our country’s renewable energy goals -such as exploring new technologies like batteries, as well as studying the feasibility of RE as baseload. These are the key enablers to future proof our generation business.”