An MNC with a Filipino touch

James Hardie Phils. has done well in the current economic doldrums in part because its president, John Balass, has touched base with its Filipino workers.

"We have an LDP or lunch date with the president every Monday where we gather about eight to ten people from the different departments like manufacturing, sales, human resource and finance," said Balass. "They can ask me any question about the company or about me."

Balass said the LDPs have allowed him to get a better perspective of what’s happening to the company. It allows him to detect if there is a problem brewing somewhere, simply based on his employees reactions, an eye contact or body language.

Aside from the weekly lunches, the company also holds monthly socials at the cafetorium in their manufacturing plant in Laguna. During these meetings, Balass comes out with a company report on whether the company is earning or losing money. "This way, employees know if there’s a need to further improve efficiencies or to tighten their belt," he said.

Employees’ efforts for the company and for their other social activities like bowling are also recognized in these meetings.

Initially, employees were surprised at the agenda of these monthly meetings. In time, however, these meetings have improved employee morale because they feel that they are an integral part of the company.

Flat organization

Balass does not believe in "power distance" or that gap between the boss and his employees because he sees himself as a leader rather than as a boss.

Since his appointment last year, Balass has flattened the organization with only eight people in management reporting directly to him.

Everybody in the company is called by his or her first name. For James Hardie employees, their president is simply called John.

So far, no one has abused his openness to his employees. In many instances, he is treated as a family member by many of his employees, who invite him to their homes during special events like weddings.

With this cozy relationship, there is no need for a labor union. Efficiencies have improved while sales have gone up. As of end-2000, the company’s market share for the walls and ceilings segment is 17%.

Replacements

The increase in sales could be traced in part to higher productivity and in part to the preference to use James Hardie products under the Hardiflex brand for replacements or repairs in the home.

Hardiflex products use the fiber cement technology. Fiber cement is a composite building and construction material made from sand, cement and cellulose fiber such as pine. Because they are fire-safe, water resistant and cannot be eaten by termites, Hardiflex products are used extensively as a cladding or lining material in residential, commercial and industrial construction.

Next year’s sales will hopefully be better with the introduction of new product lines such as the Hardiflex planks, which are wood substitutes, and increased exportation to countries like Taiwan , Korea, Hong Kong and Vietnam. Exports currently accounts for about 30% of total revenues which is expected to hit P1 billion this year.

While there seems to be a perception that the Philippine is losing out in the competitiveness game, Balass believes otherwise. "If you want to strive for efficiencies, then set good objectives and get good people, of which the Philippines is not lacking in," he said.