Layoffs last option as RP firms try to cut expenses

MANILA, Philippines - All manner of Philippine companies — big and small, domestic and multinational — said laying off workers for financial survival is their very last option. This was, among others, the preliminary result of a survey undertaken by the Management Association of the Philippines (MAP), a group of business executives that promotes best management practices. Besides avoiding retrenchment, its 800 member-firms are also doing their best to prevent closures, thereby precluding the transfer of operations to other countries, MAP said, citing its survey. Companies also intend to cut all sorts of costs, including travel, logistics, fuel, facilities, marketing, and advertising, said the survey, which has yet to be released formally. As a result, more businesses are focusing on where the money is and are considering procurement contracting, Jesus Carlos P. Villaseñor, vice chairman for MAP Information and Communications Technology (ICT) committee, said. "These are very sensitive areas for many organizations especially for private entities. Anything that you could save actually boosts your productivity. Gone are the days when companies would like to increase revenue by increasing market share and price," he said in a Makati briefing held on Tuesday. "If we promote best practices in procurement, it will proliferate in different segments of the country," Villaseñor added. MAP’s Tuesday briefing also emphasized companies inclination to improve productivity by using automation and ICT and redesigning organizational processes, and outsourcing. At the same time, many of the survey respondents also expressed their support for lower taxes and cheaper electricity. However, Mark Watkinson, committee governor-in-charge, said the organization would not necessarily approach the government to reduce tax rates. "The government has quite interesting schemes to encourage investment to which they provide tax breaks. We want to encourage our members to know what these tax breaks are. The government has these programs not everybody is aware of," he said. Although the poll has yet to be completed, the group considered it necessary to release “partial but significant results" to proactively align the group’s programs that will benefit the business community, a MAP official said. The survey’s results will give businesses “the opportunity to lower their business costs to survive the crisis and become more competitive," said Elizabeth H. Lee, MAP’s committee chairman of trade, industry, and ICT. The survey is subsumed under MAP’s Cost of Doing Business project, which is currently being handled by Lee’s committee. In turn, the said committee aims to encourage MAP members to focus on reducing non-people-related costs instead of cutting jobs. The group said it will seek the support of government agencies such as the Bureau of Internal Revenue (BIR), Bureau of Customs (BOC), Department of Environment and Natural Resources (DENR), Department of Energy (DOE), Department of Tourism (DOT), and the Department of Trade and Industry (DTI). The committee also bared plans to coordinate with other business organizations such as Bankers Association of the Philippines, Financial Executives Institute of the Philippines, Makati Business Club, Philippine Chamber of Commerce and Industry and Philippine Institute of Certified Public Accountants. Businessmen seek “accurate and updated industry economic data to benchmark their company's performance and expenses," Lee said. Companies will be able to “predict and manage exchange rate trends" with “better and more reliable and realistic information from the government or research institutions on infrastructure projects and the economy," she said. - With Ruby Anne M. Rubio, GMANews.TV