Yahoo Finance Bain's Maceda shows how a new generation wants to be led
The younger generation want to be heard and they want to hear too.
The way businesses function has changed much over the last couple of years, no thanks to the pandemic. What has stayed true, nevertheless, is the mission of Bain: to dish out the best advice it can to its clients, no matter how that’s delivered. “If anything, the need by clients for good consulting partnership to help to achieve their mission has gotten higher,” says Emmanuel “Manny” Maceda, CEO of Bain and Company.
A congruence of factors - the uncertainty of the overall business environment, the rapid changes in digitalisation, the task of dealing with the pandemic – has in fact created such unexpectedly strong demand for the services of Bain. The firm is not only riding on its highest growth period in more than two years, its consultants are all booked up that the firm has declined work for the last couple of years. In short, Bain couldn’t take on new assignments unless it hires more. “We have a supply-led problem,” says Maceda, in an interview with The Edge Singapore.
Besides a roaring business, Maceda has other reasons to feel good about – not just the firm he leads, but his own career. He is the first Asian to head Bain, ranked together with McKinsey and Boston Consulting Group as the “MBB” of the hallowed world of management consulting. He is the eldest son of the late Ernesto Maceda of the Philippines, a former senate president and chose to join Bain in 1988 over a competing offer from General Electric, which was then one of the most powerful US conglomerates and whose CEO then, was the legendary Jack Welch.
Relationships
Back in March 2020, when the pandemic spread globally, all travel halted and following the initial adjustment, Bain’s consultants realised that they’ve actually become more efficient, as they were able to still work with their colleagues virtually and engage their clients, “instead of waiting for Manny or somebody to fly 16 hours from San Francisco to Singapore. We didn’t know that it would be that an easy adjustment,” says Maceda.
However, that’s not saying the whole business has turned virtual forever as a result. In fact, given how homo sapiens is still very much a social species, the fundamental activities of building relationships, inking business ties and so on, are being carried out face to face as they used to be with the relaxation of travels. “Businesses like mine that are based on mentorship, apprenticeship, feedback, training - well, some of that could happen, virtually, but it was just hard to do,” says Maceda.
He believes that certain aspects of the industry will go back to the old ways – even for new recruits. “A bright young graduate didn’t sign up for a job that says ‘I’m going to do this entirely from my bedroom. Whether you call it glamour, they want the experience, they wanted personal growth. My firm, with this culture, doesn’t really necessarily attract people who want glamour. But it's definitely a firm that wants to attract people who want to make a difference, want to learn, want to build relationships globally,” says Maceda.
Indeed, relationship building is an integral part of what Maceda is doing. During one of his visits to Singapore, Maceda found his schedule packed with meals with key clients. True to the sanctity of client confidentiality of his trade, he won’t name who they are, except that they are honchos of the leading corporates here. His interactions with them, made possible by the recent break in restrictions, has reaffirmed the importance of relationship building within the business world, pandemic or not. “I don't know what you will eliminate, but it is clear to me, you can't eliminate personal interaction,” says Maceda.
However, there’s a balancing act of sorts. Maceda believes that the frequency of such in-depth interactions might become lower. One key reason is to be part of the broader decarbonisation trend most responsible corporates are adopting.
An individual’s share of carbon generated as a result of a round-trip business class flight can go up to seven tonnes. Travelling is still taking place, but the agenda of each trip has to be increased – stay longer days, but not fly more frequently. “Those are the kinds of changes that I could see happening,” says Maceda.
Business reality
Besides consulting for companies, a big segment of Bain’s clients are investors. Companies are going through the uncertainty of the business environment and want to reset their business strategies. Similarly, for investors, they need some counsel on how to deal with the world today and bet on the world tomorrow. “We are now in a post-globalisation world; we are growing our digital transformation even faster; we fully embrace ESG – all these and all the changes that are being created,” says Maceda, and, following a momentary pause, note that all these considerations were before Russia’s invasion of Ukraine.
The ongoing fighting between Russia and Ukraine has clearly triggered implications on multiple fronts beyond the obvious impacts on energy and food. For leaders of multinational corporations with employees in the affected countries, that’s something that they have to take care of as well – that’s something Maceda can empathise with either personally or when he talks to his clients. “While I think of Russia and Ukraine, in macro-economic terms, that's a very intellectual way to look at it. But, my first thought is our teammates on the ground in Kyiv and Moscow,” says Maceda.
In fact, there’s a Bain consultant, a Ukrainian who was working in Sweden. When the fighting broke out, he went back to defend his homeland. “That’s the reality of business as an idea, versus business as the reality of people you and I know, that's worth sums together and we can't lose as business leaders or as members of the firm, or our basic humanity,” says Maceda.
Taking a stand
Now, besides dealing with the usual external business pressures such as geopolitics, companies, and CEOs, Maceda observes, are facing challenges of another kind. As it stands, they are answerable to their boards. Increasingly, they find themselves compelled by their own rank and file employees as well as members of the public to make a stand on issues not necessarily directly linked to the business of the company. It is not just about criticising Russia, for example, over Ukraine, but on local political and social issues.
For example, last year, the US state of Georgia passed a law to restrict voting access. Major companies with a presence in the state, namely Delta Airlines and Coca-Cola were compelled to state their opposition after they had earlier kept silent. In a somewhat similar issue, Disney was criticised by certain quarters for publicly opposing Florida's new parental rights bill. “That’s become part of the job,” says Maceda.
Why is this something Bain, a business consultancy should bother itself with? For Maceda, it relates to the ability to recruit talent and retain those sharing the same values with the companies their work for.
To Maceda, CEOs need to pay attention to this aspect because they have to deliver “value" to a broader range of stakeholders and not merely their shareholders. In other words, the traditional definition of stakeholder capitalism no longer applies and companies’ mission statements have gone from delivering merely “economic value” to “value” as defined in the broader sense.
An issue that’s of interest to employees might be the same one that interests the community this company is in. And the community includes both employees and customers and not just investors and by extension, has a bearing on a company’s share price. Even for privately-held companies, there’s an implied valuation.
For the younger generation of colleagues, a company’s leadership, by staying silent on an issue, is deemed as being complicit. They want to be heard – and they want to hear from their leaders too, as they want to be proud to be associated with companies that they belong to so that they can find a stronger purpose and ultimately, deliver more value for the company and its stakeholders.
Pretty good place
Now, given Maceda’s heritage and background, does it suggest he will steer the firm towards paying more attention to growing its business in the regional economies of southeast Asia? After all, this region is seen as a safe haven for investors feeling the volatility in other markets.
For Maceda, the answer is “yes, absolutely”. There’s both his innate familiarity with this region, and the region’s further growth potential to be tapped, and for Bain, it is in an industry that’s enjoying underlying demand growth for top-notch strategic advice. “Southeast Asia has so much going on with underlying great demographics,” he says.
Maceda acknowledges that individual Asean markets are unique in their own way but the region as a whole has plenty of commonalities as well as key advantages such as Singapore at the centre, with a regulatory and political regime that the global business community can count on.
In contrast, the pandemic has made it relatively tougher to invest more in China, and Asean economies have been seen as a credible alternative be it as a manufacturing and supply base, or consumers in their own right. When Maceda joined the firm, there were five offices in total. Bain’s more recent offices are in this region, including Manila. “This is a pretty good place to be in,” he says.
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