Sociology of Businesses in the Philippines

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Many industrial parks, either internationally or locally, are now being established in the Philippines. Industrials factories are now growing in size and number around the country.

There are fortunate and successful businesses but there were those that do not thrive in the industry.There are several reasons of failure or closure of the businesses specifically industrial factories. One reason is the unstable economy. The economy is an institutionalized system for production, distribution, and consumption of goods and services. (Dennis, et al, 2005) This has been affected by the threats of political and civil war during the people power revolutions. Investors hold and pull back their investments to secure their capital.

As of today, Philippine government has restored political and social order and, the safety and security of the businesses. Likely, the business process outsourcing in the Philippines is now conceivable.  The world’s BPO market is projected to reach $682 billion by the year 2008, according to research group International Data Corp. (Mugas, 2006)The labor skills of Filipinos are well-known for its polished works.  In 1987, an assessment of the Filipino national values was conducted under the Cory Aquino administration during the time of so-called Quarter Storm (after People Power I). It shows that Filipinos are flexible, adaptable, creative and hardworking.

(Ronquillo, et al, 1995)Labor unions have been another and major reason of business failure. As defined by sociologist, Lucilla Salcedo (1999), these are organizations of worker that attempt to improve wages and working conditions through various strategies, including negotiations and strikes were founded. Actually, no cultural barrier has been a reason for the disintegration of business by foreign investors. The Filipino personality today is the product of a conflux of socio-cultural, political and religious influences by the Chinese, Indian, Malay, Spanish and American. The Filipino personality is both Asianized and Westernized. (Ernest Tan, 1994)Usually, language barrier is the actual problem by foreign investors.

Filipinos has a lot of different dialects. Thus, foreign investors hire local managers to run the company in order to resolve some cultural and language barriers. Filipino managers are handling the workers directly. And they are the one who reports workers’ performance and objectives to the company.

Because foreign investors give full authority to Filipino managers, there are cases of protest of workers against the abuse of authority by Filipino managements. In exchange of this action, labor union tends to ask for even more benefits than the company would be able to provide. More so, lack of attention or ignorance, by Filipino managements, of workers’ concerns usually caused the mass leave in the company. And this results to stoppage of factory production operations which negatively affects the company for the loss of profits.

A specific example, as reported in Virtual Asia dated December 2001, by which Nestle Philippines Incorporated has experienced labor rift when a new collective bargaining agreement, submitted in November 2001, by two labor unions, with factories located in Cabuyao and Batangas provinces, was failed to be approved. The Labor Department issued an order to prevent the two labor unions from staging strikes while restraining the Nestle management from retrenching workers. Although, Nestle is said to be one of the highest paying company, they accepted the suggested move but workers still pursued the strike. As of the present, Nestle factory in Cabuyao province is well-secured by riot police at their main gates.To resolve above problems, foreign companies should have the best knowledge about the Philippine Labor code and, requires management skills for negotiations of the issues on benefits and concerns of its workers.

Also, foreign managements must have constant and direct communication and supervision of the local workers.Big and well-established companies like Mc Donalds and Jollibee, both prestigious food chain, utilizes Filipino culture and taste for the advertising and promotions of their food products. They also ensure the hospitality of their workers, which is another specific Filipino trait, so that consumers will continuously patronize their products.  Close family ties and being respectful to elders are some Filipino character usually shown in the advertisements of their products.According to Cervin Eviota, McDonald’s public relations consultant for Visayas and Mindanao regions, their company is conducting trainings and orientations for managers are franchisee on how to handle crisis, how to handle their customers, and even how to handle media interviews.These fast foods are also accepting suggestions and comments about their products to continuously provide excellent service and create further innovations in their products according to consumer’s taste.

For the benefit of the above workers, the company provides meal allowances in kind of their products rather than in monetary value. Service crews are usually employed under five or six – month contract. Although, regularization of employees are limited by the company, so as to freed the company with the obligations for regular worker’s benefits, but renewals of contact are encouraged among their workers. And promotions of job positions are chosen based on performance, capabilities and length of service of their employee irregardless of educational background.For Pizza Hut and Shakey’s, these food companies automatically include service charge of 10% of the total amount of food purchase as tip or incentives to their service crews.

This is to ensure better service rendered by the workers with each customer.Bottling companies such as Coca-Cola and Pepsi provide yearly profit sharing among their production and management staffs depending on the factory productivity performance.RFM Corporation, a second largest food and beverage conglomerate in the Philippines, generated P10 billion in net sales for the year 2001. The company provides consumers world-class product at affordable prices. Filipinos colonial mentality has been the major factor considered in this food industry since many Filipinos preferred foreign goods and local products are less appreciated.

(Hunt, 1997)Because factories were located in science and industrial parks of farther distance from the housing communities, some companies, such as ROHM Philippines and Toshiba, both semiconductor manufacturing companies, provide shuttle services. These companies also hire production workers at nearby provinces. This promotes workers’ attendance especially on shifting schedules of the manufacturing industry. The semiconductor and electronics industry is the most prepared domestic sector for further global trade liberalization, a study sponsored by the Philippine Chamber of Commerce and Industry showed. (Domingo, 2007)For business process outsourcing, such as HongKong-Shanghai Banking Corporation (HSBC), Convergys and E-telecare, they give health card benefits upon employment by the company.

This is for the security of worker’s health because of the rigid training and night-shift actual work schedules. Night differential and transportation allowance are also part of their benefits.Increasing productivity in the emerging post-industrial economy has depended on a longer workweek averaging almost forty-nine long hours (Berger, 1986). As long as enough benefits are given to workers, based on the nature of work and the tasks to be done, workers will be loyal and hardworking for the success of the business company.

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