by Rose Cheryl Orbigo, BMP 2005
WHEN NAPOLEON L. NAZARENO was a small boy, he had a high-flying ambition: he wanted to be a pilot. Little did he guess that he would later hold positions that would enable him―and entire companies ―to soar high.
Polly, as he is called, was born into a modest, middle-class family. “My father was a colonel in the military and was thoroughly disciplined,” he described. “My mother was a negotiator. She had a knack for making the right adjustments in order to keep life moving smoothly.
“The thought of being a pilot excited me when I was young,” he recalled.“I think it was the same for all kids because flying airplanes was cool.”
Polly has six siblings. One is Fr. Gus, a priest with the Ateneo de Davao University. His only sister has retired from the Government Service Insurance System. Two brothers live abroad, and two others are in the Philippines.
Right after graduating with a Mechanical Engineering degree from the University of San Carlos in Cebu, Polly wound up as a salesman driving around Northern Mindanao. Once, when he was in Cagayan de Oro City, his brother Gus asked him, “Why don’t you take up master’s education?” He recommended that Polly take the AIM Admission Test to be given at the Ateneo de Cagayan University, where Gus was teaching.
“I thought there was no harm in taking the test, and it so happened that my schedule permitted it. My problem started when they told me I passed,” he jested. He joined the masters degree program in business management.
“I wasn’t outstanding in class,” he admitted. But being a mechanical engineer, he naturally gravitated toward math subjects like quantitative analysis(QA) and accounting. But he also found a liking for HR, marketing, and strategy subjects.
“This, I believe, helped me in my consultative approach to corporate negotiations. I was impressed by Professors Fil Alfonso, Vic Lim (Business Development), Gaston Ortigas, and Francisco Bernardo, my professor in QA. They have, in one way or another, influenced my thinking and my brand of leadership.”
The most challenging part of his AIM days was the Written Analysis of a Case (WAC). “I was slow in typing,” he explained. Nonetheless, from AIM he acquired the discipline, the attitude, and the thinking process. From his father, he also learned strict discipline, and from his mother negotiation skills. All these would guide him well in his future jobs.
After getting his master’s degree in 1973, Polly joined Philippine Match Co., which makes matches and disposable lighters. He also became a production manager of Akerlund and Rausing, a multinational packaging company later bought by Metro Pacific Corp. At Metro Pacific, Polly rose through the ranks to become its president.
In 1998, he became president of Pilipino Telephone Corp. (Piltel) and took on the task of resuscitating the ailing mobile phone subsidiary of Philippine Long Distance Telephone Co. (PLDT), the country’s largest telecommunications company. At the time, Piltel had $850 million in debt, 2,500 employees, a declining analog mobile phone business and no cash.
After a decision had been made to save the company, Polly opened negotiations with its creditors and took the drastic step of declaring a moratorium on debt repayments.
“We negotiated with the CEOs of 27 banks in the country,” he narrated.“It was a humbling process. At the same time, you really needed to find a middle ground every time and be able to craft solutions that would fit all of the banks. I had a lot of help, in the final analysis. After about a year and a half, we were able to put the major restructuring in place – without going through the courts.”
As he wrote in the book Taking Aim: Asian Management Breakthroughs, it was “the first successful major restructuring agreement in the Philippines completed on a consensual basis.”
Nevertheless, the strain of that effort took its toll on his health. After noticing that his eyesight was failing, he consulted his eye doctor. It turned out he had a hole in his retina caused by stress.
Now, with his eyesight crystal clear, Polly is concurrently president and CEO of PLDT and Smart Communications, the market leader in the Philippine cell phone industry. “You gain that learning curve when you go through the strain and the stress, but in a way you develop the knack of handling it.”
Polly took charge of Smart in 2000, when the Company was at a crucial juncture. Though the market leader, Its dominance in the analog mobile market was being rapidly eclipsed by the soaring popularity of texting on GSM. Smart launched its own GSM service on postpaid in 1999, but by then its rival Globe Telecom had built a huge lead in the GSM market.
Backed by parent firm PLDT, Smart launched an all-out drive to seize leadership in GSM through an aggressive nationwide network roll out and a high-powered marketing campaign. By early 2001, Smart took the lead in GSM and has never looked back.
“We bet the farm in that effort. Money was pouring out the door and for a while we piled up a huge loss. But the wager has paid off. If we had not done it, we would never have won market leadership,” Polly said.
Smart has stayed No. 1 by introducing game-changing service and product innovations. In 2003, for example, Smart introduced electronic airtime loads in sachet packs. Called Smart Load, this world-first service made mobile phone services more affordable to a much wider base of users. Before, many industry analysts thought the mobile phone penetration rate in the Philippines would not exceed 20-30 % due to the low income levels of Filipinos. Because of innovations like Smart Load, over 80% of Filipinos are now using mobile phones.
Meantime, as PLDT president and CEO since 2004 , Polly has led the transformation of the landline business from an overwhelmingly voice-driven service to an increasing broadband data-powered industry.
This involved not only converting PLDT’s legacy landline system into an all-internet protocol next generation network, but also transforming the structure and culture of PLDT into a much more market-driven, customer-centric organization.
Today, PLDT’s transformation program is focused on getting the Group’s fixed line and mobile businesses to work much more closely together in order to better serve customers through converged business strategies.
PLDT’s recent controversial acquisition of Digitel, the third player in the market has given Polly his toughest career challenge yet.
“This will put us in a better position to serve our consumers nationwide,” he said.“If Piltel then was my biggest challenge, the tests we face now are tougher.”
“The industry is not how it used to be 10 or even five years ago. The game has changed dramatically with the entry of new competitors, both traditional and non-traditional like Google and Facebook, also called over-the-top players,” he explained.“The innovations we bring to the market are aligned with these changes. From being a telecommunications company, we are becoming a technology lifestyle company , and this is evident in Jump, our new convergent store.”
Because of his important positions in PLDT and Metro Pacific, its seems inevitable that Polly gets entangled in controversies. How does he deal with controversies?
“My formula is simple: I hide from it. I keep a low profile, and I delegate upwards,” he joked.
“The important thing is to deal with the conflict and deal with it promptly,” he added in a more serious tone.
For Polly, his role as CEO is to make it fun for people to work. “The fun happens when we get together and run after big hairy goals. Every milestone, by itself, is really a journey. When you see people morph and become better individuals, that is the greatest satisfaction you can find in any career,” he noted.
“It’s really [about] how people can shine and achieve greater things together with you. In most cases, they think it is beyond their grasp, but it happens. Being able to have a hand in molding them to become better leaders who will eventually take our place in the organization is not only a responsibility for me, but is something I delight in doing,” Polly said. “ That knowledge that they have been prepared well and they embody the same commitment as you do to continue the leadership legacy is what I consider the most fun and fulfilling aspect of my job.”
In 2010, he was called to keep the flame ablaze on another leadership legacy. Already a member of the AIM Board of Trustees(BOT), he was requested by then-chairman of the board Jose Cuisia Jr. to become co-chairman.
“They’d been trying to convince me to become co-chairman on the pretext that you share a responsibility, but you are not in the hot seat,” he said. But with Mr. Cuisia appointed as Ambassador of the Philippines to the United States in early 2011, Polly has become the lone chairman of both the AIM BOT and Board of Governors. “My intention is to get another co-chair,” he joked.
Seriously though, Polly accepted the chairmanship because “it was an opportunity for me to give back to the school. The school helped put my career on the right trajectory and brought me to where I am today. I wouldn’t have met my wife, and I would have been a salesman all my life had I not entered AIM.”
“But beyond the facts and figures we learned, it is the Asian perspective that had proved invaluable,” he continued.“Management principles are universal, but they must be applied to local conditions. AIM gives you a better sense of what it takes to be a manager in an Asian setting.”
Another life-changing element of his AIM days is the ties built along the way. “Our Class ’73 meets every month up to now, and we are in fact celebrating our 40th year.”
What changes would Polly, as the first alumnus-chairman, like to see at AIM?
“First of all, the five-year plan is in place, approved, and concurred with by the joint Boards of Trustees and Governors, the faculty and the alumni, and the rest of the stakeholders.I would like to see the filed cases settled or dropped for us to be able to start on a clean slate, and therefore provide the new board with an opportunity to take AIM to the next level and regain its original position as a premier management school in Asia.
“In the rankings, I’d like to see AIM go up to the Top 10 in the Asia Pacific,” he added.“I’d like it to be more international not only in the student body but also in the faculty, and to have hopefully greater participation of Filipinos, too.
“The strategic plan clearly stipulates the roadmap as to how to get to this goal,” he explained. “Now is the time to really step up and be a part of AIM’s next phase of evolution. The alumni should be the driving force because there has always been this issue as to who owns AIM. If the alumni step up, then they should be the driving force. It’s not only the alumni. We also need friends to be with us to give us more teeth.
“Academic institutions are supposed to be beacons of light that help illuminate questions and issues that society faces. AIM should perform that role for the Asian region. AIM alumni should be drivers for progress in their respective countries. More importantly, the Institute and its students should understand that the world has changed and will continue to change at a much faster pace. As Thomas Friedman said, ‘The world is flat,’ and we need to be able to adapt to globalization and all the changes that come with it,” Polly said
Juggling these changes and his multiple positions, Polly’s days are usually a long series of meetings that last until evening. But he makes it a point to work out at the gym before running to his meetings and to play golf when time permits. And he starts every day by going to Mass at 7:30 with his wife, Cecille.
“I found out later in my life that you need the strength. You become humble enough to find out that you need God’s reinforcement in all that you do,” he stated.“When you are younger, you feel you can do it on your own steam. As you grow older, you feel, ‘Oh my God…’ Your responsibilities increase as you grow old. But then you begin to know how to handle all of these things you have to go through. And then you realize that things happen not because of you.”
“Whatever happened to me was so good that it can’t be me. I’m just too limited to be able to do what I have done.’ You begin to feel that you need that (time with God). Also it’s good bonding with your wife. Everything comes into place; all of this is just something you have to do. There are more important things in life,” Polly added.
“I take it one day at a time. That’s what it’s all about,” he continued. “I learned from my mentors, foremost of them , of course, is (PLDT and Metro Pacific chairman) Manny Pangilinan. He is a person whose enormous capacity for work is matched by the wide diversity of his interests,” he said.
Polly’s other mentors are CEOs to whom he has been close. One is his former boss, Toto Mapa. “That’s a guy I learned a lot from because he was asking the right questions. He knew how to listen,” recounted Polly. “Most of these people taught me how to listen.”
Another mentor is Juan “Johnny” Santos, former Secretary of Trade and Industry and CEO of Nestlé Philippines. “We’ve been friends for so many years. We are golfing buddies. He ran Nestlé for 30 years. Now he’s the chairman of SSS (Social Security System)… One of the things Johnny taught me was ‘You do not seek power; it seeks you.”
Commenting on the dizzying pace at which the telecoms moves, Polly explained that “there is no time to have big victory parties. The company moves from one struggle to another. At the end of day, the simplest way to celebrate is to go home and be with your family.
“Everything is balanced out with the time I spend with my family and my grandchildren,” said Polly, who has been blessed with two children, Reizhelle and Bryan. “I am at that stage where I am happily indulging my grandkids. I aim to be the greatest grandfather. I’m trying very hard to be a good grandfather because I’m trying to make up for lost time as a father.”
Polly’s five grandchildren are his “preoccupation.”“Spending time with my grandkids is like my fountain of youth. I watch movies with them. I even bring them to Time Zone, and I wait for them there. I spend part of my week with them. I actually look forward to it.”
Is the best yet to come from Polly Nazareno?
Polly says he intends to reinvent himself in the next five to 10 years.
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AIM Leader Magazine 