Concepcion Industries Corp. chief executive Raul Joseph “Jojo” Concepcion says a strong focus on people is what sustains the growth of the 54-year-old company, considered the largest provider of cooling solutions in the country today.
“Our strategy is very simple. Position our business to capture growth when it happens and do what we need to build our capabilities ahead of the curve. With an accelerating business growth, we need to start building capabilities. Equally important is raising the bar in our commitment to service excellence to our customers, as well as developing engagement to our company,” Concepcion says during the Anvil Business Summit 2016 organized by the Association of Young Filipino-Chinese Entrepreneurs at Marriott Hotel Manila in Pasay City.
CIC is considered the largest manufacturing R&D investment facility in the Philippines. “Last year, our total revenues reached just under P11 billion with a market capital of P20 billion,” he says.
The Concepcions are now a vast business family. “We have 21 COOs [child of the owners], 69 of what I called COCOOs [children of the child of the owners], 3 COCOCOOs [children of the children of the child of the owners],” he says.
Concepcion, 54, says only 30 percent of the family business survived the transition from first generation to second, only 12 percent from second to third. Now, it is only four percent from third to fourth. He quotes the Chinese saying that “wealth does not pass three generations.”
“This means based on the law of average, the odds are that the statistics are against us. I belong to the third generation of Concepcion—the generation that will destroy the wealth or what we call ourselves the ‘destructors or destroyers,’” Concepcion says. He succeeds his father who took over after the company patriarch Jose Concepcion Sr.
Concepcion, who obtained a business administration degree from Simon Fraser University, says that “the third generation of Concepcion are still very close, believe in the same thing, share common values and still have family equities.”
“Our status in the business is always updated and so we form a family council that consists of different heads of the families to ensure the succession of the business,” Concepcion says.
Apart from his reassurances, Concepcion and his company’s positions and status show CIC as a booming business.
Jojo Concepcion, as what he is known, is the chairman of the board and CEO of CIC. He is also the chairman emeritus of Philippine Appliance Industry Association and president of Concepcion Carrier Air-conditioning Company, Concepcion Midea Inc. Philippines, Concepcion Durables Inc. and Concepcion Industries Inc.
Concepcion Industry Inc. in 1962 has been taken over by siblings Raul (Jojo’s father), Mary and Rene during the ‘boom and bust’ times of the 80s and 90s and has since become Concepcion Industrial Corp. “We are the largest manufacturing R&D investment facility in the Philippines. Supported by nationwide sales, we are allied with two of the largest corporations in the world—United Technologies and Midea. We are the market leaders not only in numbers but also in minds of the customers. We are currently rated as the most trusted brand in the Philippine market,” Concepcion says.
In revenue, CIC went from P5 million in 1962 to P10.6 billion in 2015, which Concepcion describes as a “a big bulk, sizable growth in the past years.”
Concepcion reveals the four phases of the group’s journey starting 2011. He says the first step is “building the strong foundation.”
“Before you can even think of growing, it is essential to build a strong foundation. The transfer of leadership to the next generation of owners and managers is critical for us. It is very important for the Concepcion family to threshold the 5th generation,” Concepcion says.
He says they focus to build leadership, highly-competent professionals, both local and people from abroad mixed with experienced family members. The next step is “redefining a purpose as well as setting guidelines.”
“We look closely in our businesses by examining our business models, redefining what our core businesses were, as well as our market strategy. Key pillars of the foundation that we need to put in place in order to grow our business are equally important so that the growth is sustained,” Concepcion says.
He says it’s important to know how to go to Point B. This will give “a better understanding on where we are now and the steps that we need to take,” he says.
“It’s about beginning with the end in mind. It is about understanding our destination. More importantly, the key to success is higher because you know what has to be done. Less distractions, less mistakes, better focus,” Concepcion says.
For CIC, he says they have already laid out their vision, “big and ambitious goals that will differentiate [them]” for 2020.
The real challenge, he says, is how to get there—the last phase. It is about “developing a road map to plan and the discipline to see the plan through to the end.”
“Getting the organization and yourself to believe in your dream is the first challenge. It is important that you believe the journey to Point B is possible. We change as we go through the pursuit of our goals. The ability and the speed of growth is directly correlated in the organization’s ability to embrace and accept change,” Concepcion says.
Concepcion says CIC charted a road map to guide how they will change their plans, which includes strategic directions and different business models.
He is optimistic about the future. There was never a time when the Philippines’ future is as bright as it looks today, and that the Philippine economy will achieve further growth within the next few years, he says.
“We reached the inflection point—the point where the business and market dramatically change. We expect the Philippine market to triple over the next five years. Already in 2014, 2015 and 2016, we see the market growth accelerate to territories not seen before [15 to 25 percent growth rate],” Concepcion says.
He says the last four to five years saw an expansion of the business, and it will only further increase as the number of families who live without basic appliances remains high but their potential to have one is great.
Concepcion says this is the most exciting time in Philippine history. He encourages young entrepreneurs to explore these opportunities. “There is no such formula or secret but it is the focus in building the foundation to growth. In short, focus on growth, strong foundation and sustainable profit,” he says.
Concepcion says to sustain the growth of the business, it is important that the family passes on strong values to the next generation.
“The only thing you can pass on to the next generation is really strong values. Next one is the education. They need to study. I think that’s what you can pass on to them. It’s not money but it’s the values and education,” he says.
