Corporate culture makes or breaks the brand

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Don’t Drink And Write

When I went to Taiwan last week upon the invitation of the Dutch truck manufacturer DAF, the first order of the day was a visit to the Formosa Plastics Group Museum. Formosa is one of the biggest (and most respected) corporations in Taiwan — think Ayala — with diverse interests in various industries. It is the manufacturing partner of DAF in the Republic of China, but it was hard to see why else our group had to learn its history and that of its beloved founders, the brothers Wang Yung-ching and Wang Yung-tsai.

During this museum tour, I honestly came to admire Formosa. I was in awe of its humble beginnings, its best practices and its proud accomplishments. What I had expected to be a boring activity turned out to be an almost spiritual experience: I felt a genuine desire to think, work and conquer like the great people of Formosa.

We were brought to the manufacturing facility of DAF on the second day. I can now tell you that whoever planned the itinerary was brilliant. By introducing us first to the local company behind DAF, we had a better appreciation of the truck brand when we went to its assembly plant. It put DAF in a positive light, at least in my mind.

Because I already knew that the organization representing DAF was capable and trustworthy, it was easier for me to believe in a brand I had not been familiar with prior to the trip. It assured me that DAF was in good hands — that these folks wouldn’t cut corners or compromise quality or screw their customers. The products themselves may be excellent, but it’s their association with a professional, ethical and successful team that ultimately earned my respect.

Of all the things we did on this trip, this stood out to me the most. Mainly because the automotive industry that I cover is made up of international brands represented in the Philippines by local importers and distributors, and their performance in our market is largely dictated by the corporate culture that dominates their affairs.

For instance, brands managed by reputable companies tend to enjoy smooth sailing in our market. They may receive bad press every now and then, but even the way they face adversity is nothing short of impeccable. On the other hand, brands backed by questionable characters often run afoul of the law, usually for offenses that are clearly not due to mere oversight but to an inherent ethical flaw.

The thing is, most brands that get into scandals in certain markets are owned by parent companies that have a morally sound corporate culture — they just happened to unwittingly partner with the wrong people. And when they realize the mistake they’ve done, it’s usually already too late.

We sometimes hear about a Filipino company wanting to bring in a foreign car brand or even take over an existing one. But we only get wind of such a development when the deal has already been finalized. What we do not know are the multiple rounds of negotiation before the parties involved even got to shaking each other’s hand. And way before sitting down to discuss, the local company had actually participated in a bidding process, in which it had to convince the foreign principals that it was the best among the candidates wanting to represent the brand in the Philippines.

And even then — even after all the background checks and the screening efforts — unscrupulous organizations sometimes still manage to get picked, setting the stage for a series of misfortunes for the brand in our market.

From a consumer standpoint, a brand’s local affiliation is most relevant. When you purchase a new vehicle, you basically commence a long relationship with its distributor, whether you like it or not. How your after-sales requirements will be served depends on the competence and the integrity of this distributor. I don’t care how exceptional the car is, your satisfaction as a customer primarily hinges on how the local brand steward does its job — which hinges on the company’s corporate culture.

When you shop for a new car, besides test-driving and researching on the model you’re eyeing, try to know the local company distributing it in our market. Try to read up on its history. You will save yourself a lot of headache — and unnecessary expenses — just by being aware of the organization you want to get your vehicle from.