Leadership Excellence Award: PTT
Leading an organization in a tumultuous time of crisis and digital disruption is of the greatest challenge. One must demonstrate both resilient leadership and digital literacy to navigate the hardship, not just to survive but also to be ready for the next normal.
With uncertainties looming large, an organization needs a leader who has the courage to confront uncomfortable realities and the confidence to deal with the problems at hand. Leadership in a time of disruption bears great responsibility not only to take care of the people but also to set a stage for business recovery. Optimal leadership qualities to navigate the crisis and recovery may include organizing businesses via effective networks of teams, making clearsighted decisions and updating new insights as they emerge, demonstrating empathy and maintaining attention on your own well-being, and most importantly, communicating effectively.
Critical leadership abilities in the time of disruption are to exhibit clear communication, have a strategically-transformative vision of an organization, be forward-looking and innovative, and be change-oriented and agile. This year, the Leadership Excellence Award goes to PTT Public Company Limited (PTT) for its strategic leadership quality.
PTT envisions to be Thai premier Multinational Energy Company with the aim to maintain its strength in core businesses along with initiating new businesses to achieve sustainable growth. The company aspires to drive national future through the use of advance technology and innovation that contribute to the quality of life for the community and society, a concept called “Powering Thailand’s Transformation.”
PTT directs its integrated energy and petrochemical business as the national energy company whose mission is to respond to all stakeholders in a balanced manner to ensure long-term energy security for Thailand. PTT defines the corporate core values as “SPIRIT” – deriving from Synergy, Performance Excellence, Innovation, Responsibility for society, Integrity and Ethics, and Trust and Respect – that are weaved into the corporate culture where the company’s management and employees are cultivated and engaged in work with their best efforts and high moral standards.
The annual strategic thinking sessions (STS) are organized to analyze trends, identify opportunities, and develop strategic directions resulting in the 5-year business plans, action plans, risk management plans, and corresponding KPIs. In 2020, PTT adds on the “PTT by PTT” approach featuring the (P)artnership and platform, (T)echnology for all and (T)ransparency and sustainability. The company emphasizes the formation of business alliances, integration of know-how, innovation and digitalization, and administration of corporate transparency and accountability together with a sustainability goal.
PTT establishes the 4R strategies (Resilience, Restart, Reimagination, and Reform) to drive its businesses. These strategies are to ensure operational resilience and business continuity, to resume the business for future competitiveness, to initiate and reimagine business models for the next normal, and to reform the organization to accommodate the regulatory and environment change.
Organizational and Talent Development
Talented workforce is repositioned to support the new business direction and energy solution. A newly redesigned organization structure is resilient to a multitude of situations. A blend of traditional and hybrid structures allows for an agile organization to undertake new projects and startups. PTT not only recruits new talents directly from the market but also rotates the talents among its affiliates.
Innovation and Technological Advancement
PTT places technology as one of the corporate agenda with focus on open innovation and technology-driven initiatives. PTT Innovation Institute has a leading role in research and development (R&D) to support the company’s businesses. Commercialized products are, for example, the diesel-CNG conversion kit, automated system for pipeline corrosion monitoring, EV wall charger, high precision air model database for environmental impact assessment (EIA), and other 30+ new products of fuel and lubricant per year. The innovation results in a business impact of 2-3 billion baht per year in both forms of cost saving and revenue increase. The company receives the best innovative state-owned-enterprise award for 11 years in a row since 2010.
A recent innovation roadmap sets forth the promotion of operational excellence for existing business and the creation of new business opportunities (new s-curves) in the new energy and life science. The company appointed Chief Technology Officer (CTO) as an innovation executor. The company also uses venture capital and invests directly with tech startups to acquire new technology to support new growth opportunities in the targeted businesses. The investment for innovation in 2019 is 3.2 billion baht in total.
Financial Management and Strategy
To support the company’s strategic direction, financial management strategy aims to promote financial resilience, balance stakeholders’ expectation and enhance operational efficiency through the use of technology. Specifically, PTT’s finance and accounting (F&A) strategic objectives are to support business growth with financial competitiveness and cost optimization (e.g., green bond issuance), enable seamless integration for ease of doing business (e.g., standardized guidelines), and embrace a new normal and drive future workforce (e.g., Chatbot and RPA).
PTT exhibits a solid record of financial strength with stable returns to the investors and strong credit rating throughout the business cycle.
PTT introduces a comprehensive stakeholder management framework (i.e., AA1000 Stakeholder Engagement Standard) addressing on the (1) impact of a business plan on each stakeholder group, (2) development of management strategy, action plan and indicators, (3) plan implementation, and (4) monitoring and survey.
The Corporate Plan and Risk Management Committee is appointed for a progress and performance report of the stakeholder engagement. The Enterprise Risk Committee is set to review the effectiveness and efficiency of the system. The stakeholder engagement results are used as an input in the annual corporate strategic planning and sustainability management and presented to the relevant internal functions for acknowledgement and reaction.
PTT puts the emphasis on seven items of the United Nations’ Sustainable Development Goals (i.e., UN SDGs 7, 8, 12, 13, 14, 15 and 16) and outlines accordingly a strategy and business direction in line with the environment, social and governance (ESG) dimension. The company aims to create sustainable growth for all stakeholders by (1) developing human resources, creating quality livelihoods and having inclusive business growth with the community and society, (2) conserving natural resources and the environment and caring for community and society, and (3) creating sustainable growth for the Thai economy and society.
One nominated company is worth mentioning in details. This company strives to be a leading digital company that connects people, organizations, conomies and societies to achieve sustainability. Its corporate strategy concentrates on delivering advanced technology and comprehensive digital platforms to enhance customer experiences. The company puts strong emphasis on talent management with a renowned sourcing protocol including holistic profile screening, interviewing with executives, psychometric assessment, assessment center, and onboarding process to ensure the right profile for future workforce. The company is committed to being an innovative organization with the Innovation and Sustainability Committee, innovation center and open innovation management. For its financial management, the company aims to maximize value to shareholders, diversify sources of funds and optimize financing costs. Lastly, the company develops a framework for corporate sustainability based on the 17 UN SDGs and publishes its own st rategies and sustainability goals.
Other nominated companies also exhibit sustainability vision and core value. Their business strategies aim to add value to all stakeholders. They state that talent management and leadership development are essential. Finally, they all emphasize sustainable development as a must.