How the taipans trained their second generation successors

MANILA, Philippines — Hans Sy, son of the late taipan Henry Sy, still remembers the first time he was called to work in his father’s Shoemart Makati, then a small department store in what is now the country’s financial district.

He was a young boy of 13. When the Sy siblings turned 13, their father took them to SM stores on weekends to learn about the business.

When it was his turn, Hans was very excited that he could finally go to work. 

“I dressed up for it. I wore new clothes...long sleeves and pants and the first thing, I was told when I arrived at the store was, ‘Hans, please clean up all the trash cans,” he said.

Hans was shocked. He thought he would start as a clerk. He did not expect that would be his first task. 

“At first I felt very embarrassed about it but in the end after throwing away the trash, cleaning the trash cans, I stepped up. Eventually, I became a cash clerk and then a sales clerk and then to where I am today. It actually taught me the value of what my father really wanted,” he said at the recent Family Business Conference in Makati organized by the ASEAN Business Advisory Council Philippines, together with Go Negosyo and the Singapore Management University.

Hans later on realized his father was instilling in them the value of hard work at an early age. 

It would help shape Hans and his siblings to become the second generation business leaders that they are now.

Aside from Hans, the rest of the six Sy siblings have taken over the reins of the Sy empire. Eldest sibling Teresita Sy-Coson is leading all of Sy’s six children, guiding them as they steer SM Group to greater heights. 

The second generation tycoons take the baton

The Sy siblings are among the second generation tycoons who are continuing the businesses they inherited from their fathers. 

In the case of George Ty’s empire, sons Arthur and Alfred have taken over the conglomerate.

Arthur is chairman of GT Capital and president of Metrobank while Alfred is vice chairman of Toyota and chairman of Lexus Manila as well as Federal Land.

For the Gokongwei empire, John’s only son Lance leads the second generation Gokongwei business leaders. He is now the president and CEO of JG Summit Holdings while his uncle James Go is the chairman. 

The Gotianun-owned Filinvest Group is now led by siblings Josephine Gotianun-Yap and Jonathan Yap while Helen Yuchengco-Dee is in charge of the Yuchengco Group of Companies. 

Lucio Tan’s empire, on the other hand, is still led by the taipan himself who is the chairman and CEO of most of his companies. 

His son Michael is president and COO of listed conglomerate LT Group while Lucio “Bong” Tan Jr. headed
many Tan-owned companies until his sudden death last Nov. 11, which has left a big void in the Tan empire. 

Son-in-law Joseph Chua is in charge of Tan’s listed aviation services MacroAsia.

Secrets to success: Hard work and education

Some of these second generation heirs shared their secrets to success.

Like Hans, most of them were taught the value of hard work and at a young age and the importance of starting from the bottom. 

“I guess the big difference is that we were trained young. We understand the value of hard work and this is what really helped us step up. I remember the day when we were going public, and the interest of the investors was not on my father. The interest was on all the second generation and how we were going to step up. And quite frankly I enjoyed it because I made them feel that I know each and every step in the company which they couldn’t believe, and that was what helped us get to where we are today,” Hans said during the conference. 

Hans was president of SM Prime Holdings, the Sy Group’s property developer until he retired in 2016.

Stories of hardships

Tan’s son Michael shared how their father would tell them stories of hardships. 

“While we were growing up as children, my father would tell us many stories. These were stories about himself while growing up, the hardships that he went through during the war and after the war, stories about Chinese history and Chinese parables. So I think what he was trying to do was to try to instill in us positive Confucian values of patience, hard work and self-sacrifice,” Michael said in the same Family Business Conference held in October.

His brother Bong, in a 2018 interview with The STAR’s Millet Mananquil, also said their father always reminded them of his difficult beginnings. 

“Dad’s struggles always remind us of our origin. He started working as a bodegero at age of nine or 10. In college, he was working in the chemical division of a cigarette factory. He saw that one ingredient was totally imported. He said – why do we have to import refined glycerine when we can make it?” Bong recalled in the 2018 article.

During the October conference, Michael shared how his father sent him and Bong to study in Singapore.

“For us, like my brother Bong and I – he went to St. Jude and I went to Xavier – but our dad wanted us to spend more time together so when we were getting comfortable with our high school life, he suddenly yanked us out and disrupted our easy going life and sent us to Singapore. It was to get us out of our comfort zones and to have more Chinese education,” Michael said during the Family Business conference.

He said it was difficult because they missed home.

After finishing their secondary school in Singapore, they were ready to go to the US for college but then their father sent them again to China. 

“So again,  it was getting us out of our expectations. So  off to China we went in 1984. At the time, China was very backward. People were still riding bicycles and it was another difficult adjustment for us,” Michael said. 

Starting from the bottom

After finishing an engineering degree abroad, Michael was called back home to work in one of his father’s companies, Asia Brewery.

“My father said, ‘you come back and work’ so I was sent to Asia Brewery where I worked in the hardest or hottest place -- in the glass factory, in the furnace. It was really difficult but I love the job because it’s technical in nature,” Michael said. 

Bong was also called back home to work in his father’s conglomerate. He also started from the ground, he recalled in the 2018 interview.

When he came back from the US, Bong said his first job was a tobacco checker at Fortune Tobacco. It was not easy, he said.

“There are different grades of tobacco leaves and every grade demands different prices so we have to check them properly before processing them into cigarettes,” Bong said.

Bong was president of Tanduay, Eton Philippines and PAL Holdings until his death. He was also the founder of MacroAsia and vice chairman of Philippine Airlines, among other roles. 

If you don’t work, you don’t eat

Robina Gokongwei, the eldest of the five Gokongwei siblings said their father always said, “if you don’t work, you don’t eat.” 

He also taught them the importance of starting from the bottom. 

“He said if you don’t start at the bottom, you’ll never know who your customer is, and you’ll never know the issues of your staff. He was right. If he didn’t throw me into our Robinsons Department Store bodega when I was right out of college, I don’t think I would be able to manage our business. He even made sure I started in the bodega, the only place where there is no air-conditioning, and he told the HR head that I had to time in and time out,” said Robina in her eulogy for his father who passed away on Nov. 9.

Robina heads Robinsons Retail Holdings, the retail arm of the Gokongwei conglomerate. 

Lance went through the same path, shared Robina.

“When Lance was on summer vacation, he also put Lance in the Robinsons Department Store bodega, where he learned how to tag bras,” she said. 

The Ty brothers also learned the value of hard work early on.

In an interview with The STAR’s Wilson Lee Flores, Alfred recounted that he was 11 and elder brother Arthur was 13 when they were already made to work during summer vacations.

“Alfred recalled that his dad would make him dial the telephone to call up people in the office and he had to keep dialling when the numbers were busy in order to teach him perseverance. As a young boy, Alfred said his father taught him to clean up his dog’s poo, to teach him humility and to kneel down if needed,” Flores wrote in a December 2018 article.

The Ty siblings had to report to work in the offices daily at 7:30 a.m., because meetings would start at 8 a.m. 

“Today, the Ty siblings are known to work and go home later than other executives and staff at night,” Flores also said.

Indeed, the taipans have taught their successors well. 

What happens next? Will their legacies live on with the succeeding generations? Or will their business empires collapse and slowly fade into oblivion?

(To be continued)