Leadership for Sustainable Organizations by namo dhammaya

Leadership for Sustainable Organizations Sooksan Kantabutra, PhD College of Management Mahidol University

Class Activities Sustainable Leadership Leadership concept concept Sustainable SufficiencyEconomy Economy Philosophy Philosophy inin business business Sufficiency organizations organizations Applying Sustainable Sustainable Leadership Leadership inin organizations organizations Applying case ofof Sa Sa Paper Paper business business AA case

Leadership for Sustainable Organizations you are are aa CEO CEO of of aa large large multinational multinational company, company, IfIf you what makes makes you you afraid afraid of of leading leading the the company company into into what bankruptcy? bankruptcy?

Globalization & the Changing Business Environment Changesintroduced introducedby byglobalization globalizationthat thatbusiness businessorganizations organizations Changes mustrespond respondtotothem themtimely timelyand andeffectively effectivelyininorder ordertotosurvive surviveare: are: must

technologydevelopment development technology changesininworkforce workforcecharacteristics characteristicsand andconsumers consumers changes foreigncompetition competitionand andnew newforms formsofofcompetition competition foreign greaterdemand demandfor forhigh highquality qualityproducts productsand andservices. services. Consumer Consumer greater protectionlaws. laws. protection changesinininternational internationaltrade tradelaws lawsand andgrouping groupingofofcountries countriesfor fortrade trade changes benefits benefits advancementinintransportation transportationand andtelecommunication telecommunication advancement politicaluncertainty uncertaintyboth bothinside insideand andoutside outsidethe thecountry country political terrorismand andepidemics epidemics terrorism

Anglo/US v.s. Rhineland Capitalism Approaches to Business The Anglo/US Anglo/US Capitalism Capitalism The Focus on on short-term short-term maximization maximization of of shareholder shareholder Focus value ONLY ONLY value The European European Rhineland Rhineland Capitalism Capitalism The Focus on on long-term long-term sustainability sustainability of of an an enterprise enterprise Focus and its its relationships relationships with with aa wide wide range range of of and stakeholders (e.g. (e.g. community, community, future future generations) generations) stakeholders

Impact of the Changing Business Environment on Thai Corporate Leaders

High risk from the unpredictable environment Over utilize natural resources y Promote immoral and unethical activities, icausing lt i unpleasant and violent society ab n i Undermine the family institutiontwhich a is the s foundation of Thai society and su business because n people migrate to big cities U & Take advantage iofa labor from provinces by r foreign businesses li ib that invest a lot for short-term economic qugains without utilization of natural e s and labor in a sustainable way resources Di Expand the social gap between the rich and the poor, which has a negative impact on all aspects of business, social and economic development

Change Impact on Thailand

Impact of the Changing Business Environment on Thai Corporate Leaders

Business organizations cannot survive and thrive under these difficult conditions.

Leadership for Sustainable Organizations The prime prime question question for for every every corporate corporate leader. leader. The HHoow w ccan an t ddeessppiite thheeiirr oorrggan te ddiiffffic a i icuulltt ssocnizzaattiioonnss ssur urvviivvee a ociiaall && e anndd tthhr eccoonnoom riivvee miicc ccoon nddiittiioons ns??

Leadership for Sustainable Organizations Research found found that that an an important important factor factor to to sustain sustain an an Research organization was was the the need need to to seriously seriously embrace embrace the the needs needs of of organization range of of stakeholders, stakeholders, not not just just shareholders: shareholders: employees, employees, aa range customers and and suppliers suppliers as as well well as as society, society, the the environment environment customers and future future generations generations are are all all important. important. and Innovation and and long-term long-term thinking thinking are are highly highly prized prized in in the the Innovation sustainable enterprises. enterprises. They They have have managed managed to to retain retain the the sustainable loyalty of of staff staff and and customers customers to to the the extent extent that that most most of of us us loyalty can often often only only dream dream of. of. Staff Staff development development and and retaining retaining can knowledge are are also also central central to to sustainable sustainable leadership leadership (Avery, (Avery, knowledge 2004). 2004).

Leadership for Sustainable Organizations The range range of of potential potential stakeholders stakeholders of of aa business business isis wide. wide. The Employees Employees SSuucccce essssffuul Customers Customers o r orggaan l,, ssuust i n z Suppliers s a Suppliers ggeennuuinizaattiioonnss taiinnaabbllee Managers i e Managers aanndd arnellyy ccaarre Board members members aree rre e aabbou Board essppoon outt tthheem m.. Shareholders nssiibble Shareholders le ffoor r Society, environment Society, environment Future generations generations Future Trade partners partners Trade etc. etc.

Sustainable Leadership: The Broad Framework Successful organizations organizations that that have have been been around around for for decades decades Successful adopt aa system system of of self-reinforcing, self-reinforcing, sustainable sustainable leadership leadership adopt practices (Avery, (Avery, 2005). 2005). They: They: practices operate under under aa long-term long-term perspective perspective operate really value value their their people people really genuinely focus focus on on aa range range of of stakeholders stakeholders (including (including genuinely future generations) generations) future Embrace ethical, ethical, social social and and environmentally-friendly environmentally-friendly Embrace practices. practices.

Leadership for Sustainable Organizations Grid Elements

European Rhineland

Anglo/US

CEO concept

Top team speaker

Decision maker;hero

Decision making

Consensual

Manager-centered

Ethical behavior

An explicit core value

Pressured because of short-term considerations

Financial markets

Resist and challenge them

Follow them

Innovation

Continuous in process, service and product

Limited, emphasize on radical innovation

Knowledge management

Shared

Difficult to achieve; low staff retention

Long-term perspective

Yes

Mgmt. development

Grow their own

Import managers

Org. Culture

Strongly rooted in history

A challenge due to short-term perspective

People priority

Strong; heavily invest in people

Lip-service; development is staff responsibility

Quality

High is a given

Limited; cost cutting and speed

Leadership for Sustainable Organizations Grid Elements

European Rhineland

Anglo/US

Retaining staff

Low turnover rate; staff development focus

Downsizing and outsourcing common

Skilled workforce

Strong; Continuously develop firmspecific skills

Unstable workforce acts as a disincentive for upskilling employees, except for managers; employees bring generic skills to the firm

Social responsibility

Permeates organizational thinkings and actions

Often seen as reducing shareholder value and profits

Environmental responsibility

A given, bring competitive advantage and savings

Not widely considered, often seen as reducing profits

Stakeholders

Broad focus

shareholders

Teams

Teamwork is core process; often selfgoverning

Effective teamwork is a challenge; requires management invention

Uncertainty and change

Change is considered and managed process

Fast adjustment

Union-management relations

Employees, unions, management share power; employees represented on boards of large companies

Normally adversarial relationship; boards and management typically hold the power

Impact of Globalization on Thailandâ&#x20AC;&#x2122;s Development Which model model of of capitalism capitalism isis itit that that isis widely widely adopted adopted Which in Thailand? Thailand? in Anglo/US or or European European Rhineland? Rhineland? Anglo/US

Sustainable Leadership in the Thai Context: The Sufficiency Economy Philosophy

Sufficiency Economy Philosophy “...RoyalSpeech: Speech:Sufficiency SufficiencyEconomy Economyisisnot notlimited limitedto tofarmers farmersbut butfor for “...Royal everyoneand andall allprofessions professionsboth bothininthe thecity cityand andininthe thecountryside. countryside. For For everyone example,an anowner ownerof ofaafactory factoryand andcompany companyguided guidedby bythe theSufficiency Sufficiency example, Economy. IfIfhe hewants wantsto toexpand expandhis hisbusiness, business,the thereason reasonwould wouldbe bethe the Economy. normal,gradual gradualgrowth growthof ofthe thebusiness. business. IfIfhe hewants wantsto toloan, loan,he hecan, can,but but normal, hasbe bewith withgreat greatcare careand andconsideration. consideration. ItItisisnot notto toloan loantoo toomuch muchthat that has thereisisno nosecurity. security. He Hemust mustknow knowhow howto tospend.” spend.” there Dr.Sumet SumetTantivejkul Tantivejkulinin Dr.

“ใตเบืเบื้อ้องพระยุ งพระยุคคลบาท” ลบาท” “ใต

The Sufficiency Economy Philosophy Framework Three Components

Equilibrium & Sustainability Moderation

Reasonableness

Self-immunity

Knowledge & Morality

Two underlying conditions

Examples of Business Activities Inconsistent with the Sufficiency Economy Philosophy Example ofof business business activities, activities, not not consistent consistent with with the the Sufficiency SufficiencyEconomy Economy Example Philosophy, that that do do not not support support business business organizations organizations toto survive survive inin rapid rapid Philosophy, changes from from globalization. globalization. changes

Businessexpansion expansionononloan, loan,ininresponse responsetotomarket marketdemand demand Business Unethicaluse useofoflabor labortotoproduce producemore morewithout withoutcaring caringfor forthe thelabor’s labor’squality qualityofoflife life Unethical Noskills skillsand andknowledge knowledgedevelopment developmentfor foremployees employees No Carelessutilization utilizationofoflimited limitednatural naturalresources. resources. Do Donot notcare careabout aboutthe thelong-term long-termnegative negative Careless impact. impact. Carelessuse useofoftechnology, technology,bring bringabout aboutnegative negativeconsequence consequencetotoemployees, employees,customers customers Careless and their families and their families Factoriesharmful harmfultotothe theenvironment, environment,employees employeesand andnearby nearbycommunities communities Factories Cheatingononcustomer customerorortelling tellingthe thetruth, truth,but butnot notthe thewhole wholetruth truthtotosell sellproducts productsand and Cheating services services Investmentininunethical unethicalbusiness businessororcareless carelessinvestment investmentininthe theSET SET Investment Expansionininnon-core non-corebusinesses businesses Expansion Focusonly onlyononmaximizing maximizingshareholder shareholdervalue value Focus

Sustainable Leadership versus Sufficiency Economy Philosophy Commonalities between between Sustainable Sustainable Leadership Leadership && the the Sufficiency Sufficiency Commonalities EconomyPhilosophy Philosophy Economy

Suggestan anapproach approachtotosustain sustainorganizational organizationalperformance performanceand andensure ensureitsits Suggest longevity longevity Focuson onthe thelong-term long-termperspective perspectiveofofthe theorganization organization Focus Focuson onthe theinterests interestsofofaawide widerage rageofofstakeholders stakeholdersincluding includingthe the Focus environment,society societyand andfuture futuregenerations generations environment, Embracesocial, social,ethical, ethical,and andenvironmentally-friendly environmentally-friendlybusiness businesspractices practices Embrace Dealwith withthe thefast fastchanging changingenvironment environment Deal Highlyvalue valuehuman humanresource resourcedevelopment development Highly Retainorganizational organizationalknowledge knowledge Retain

Applying Sustainable Leadership in Business Organizations

Factors in Applying SL in Business Organizations Whether oror not not aa business business will will succeed succeed inin Whether applying SL SL depends depends on on two two main main factors: factors: applying leadership leadership

values and and culture culture values

Factors in Applying SL in Business Organizations Leaders are are required required toto achieve achieve their their Leaders organizational vision vision by by adhering adhering toto the the SL SL organizational Broad Framework. Framework. They They should should use use the the Broad framework toto guide guide their their business business activities. activities. framework Overtime, organizational organizational values values and and culture culture Overtime, consistent with with the the framework framework will will be be developed developed consistent ensure organizational organizational equilibrium equilibrium and and toto ensure sustainability under under the the rapid rapid forces forces ofof sustainability globalization. globalization. e.g. managers who are concerned of staff quality of life and environment, instead of focusing on short-term profits or trying to achieve the vision without caring for staff and the environment. Or when a company calls for a return of defect products.

Organizational Values & Culture Sharedorganizational organizationalvalues valuesare arevalues valuesthat thatorganizational organizationalmembers membersshare. share. Shared Withthat thatreason, reason,the thevalues valueswill willform forman anorganizational organizationalculture, culture,aaguiding guiding With frameworkfor forall allorganizational organizationalmembers. members. Indeed, Indeed,applying applyingthe theSL SLinin framework businessorganizations organizationsmeans meansthe theadoption adoptionof ofthe thebroad broadframework frameworkas aspart partof of business theshared sharedorganizational organizationalvalues. values. the Guiding values

Value a long-term perspective

Really value their people

Genuinely focus on a range of stakeholders (including future generations)

y rne u Jo y r a ion s i V

Embrace ethical, social and environmentally-friendly practices.

Thai Rice Co.

Vision of being the leading Thai rice trader in Asia in 2010

Organizational Values & Culture Shared values are core to organizational culture which indicates how people work in the organization. In other words, organizational culture is the guiding framework for organizational members in working toward their organizational vision. Guiding values

Value a long-term perspective

Really value their people

Values & Commitment

Genuinely focus on a range of stakeholders (including future generations) Embrace ethical, social and environmentally-friendly practices.

SL Organizational Culture

Org. Norms

Sustainable organization

Leader’s Roles in Creating Organizational Culture LeaderatatSWA, SWA,aahighly highlysuccessful successful Leader business,plays playsaasignificant significantrole roleinin business, developingorganizational organizationalvalues values&& developing culture. culture. Createaavalue valueofof“work “workisisfun” fun” Create Actasasaarole rolemodel model Act Usethe thevalue valuetotoguide guideallall Use businessactivities activities business

Applications of SL in Business Organizations TheSL SLcan canbe beapplied appliedwith withthe thefollowing followingareas areasofofbusiness businessorganizations. organizations. The Finance Finance Manufacturing Manufacturing Marketing Marketing HumanResources Resources Human Customers Customers Etc. Etc.

Applications of SL in Business Organizations Manufacturing Manufacturing Donot nottake takemore moreorder orderififthe theproduction productioncapacity capacitycannot cannotaccommodate accommodate Do Useraw rawmaterials materialsfrom fromlocal localcommunity communityand andwithin withinthe thecountry countryasasmuch muchasaspossible possible Use Usemanufacturing manufacturingtechnology technologyfrom fromlocal localwisdom, wisdom,harmless harmlesstotothe theenvironment environment Use Effectiveand andefficient efficientuse useofofresources resources(e.g. (e.g.recycle recycleofofraw rawmaterials) materials) Effective Donot nottake takeadvantage advantageofofstaff. staff. Quality Qualityofoflife lifeofofthe thestaff staffcomes comesfirst. first. Do Focusononemployment employmentcreation. creation. No Noreplacement replacementofofhuman humanlabor laborbybytechnology, technology,ifif Focus notnecessary. necessary. not Effectivemanagement managementofofraw rawmaterials materialsand andinventory inventory Effective Effectivemanagement managementofofwaste wasteand andthe theenvironment environment Effective Honesttotosuppliers suppliers Honest

Applications of SL in Business Organizations Finance Finance Spendmoney moneyfor forfuture futuredevelopment, development,not notasasaasunk sunkcost cost Spend Investfor forlong-term long-termbenefits benefits Invest Investininethical ethicalbusinesses businessesthat thatare arenot notharmful harmfultotothe thesociety society Invest Diversifyinvestment investmentportfolio portfoliototoreduce reducerisk risk Diversify Donot notexpand expandthe thebusiness businessrapidly rapidlyononloan loan Do Loanasaslong longasasthe thepayback paybackisiswith withininthe thecapacity capacityofofthe thebusiness. business. Do Donot notcreate create Loan toomuch muchdebt. debt. too Fairprofit profitsharing sharingtotoemployees employeesand andshareholders shareholderswith withthe thehope hopetotomaximize maximizethe the Fair benefitsofofcustomers customersand andsuppliers suppliers benefits Contributeback backtotosociety societytotoensure ensurethe thecontinuation continuationofofbusiness businessininthe thefuture. future. Contribute

Applications of SL in Business Organizations Marketing Marketing Alwaysassess assessthe themarket markettotoensure ensureappropriate appropriateand andtimely timelyresponses responsestotomarket market Always changes changes Reasonablyprice priceproducts productsand andservices. services. Not Nottoo toohigh highaaprice, price,although althoughbeing beingaasole sole Reasonably producer producer Developnew newproducts productswith withreasonableness, reasonableness,focusing focusingononcore corecompetency competencyofofthe the Develop business business Realizethe theweakness weaknessofofproducts productsand andtrytrytotomodify modifyorordevelop develop Realize Donot notlielieabout aboutproducts productsororservices servicesfor forshort-term short-termsales sales Do Tellthe thewhole wholetruth truthabout aboutproducts productsand andservices servicestotoconsumers, consumers,asasopposed opposedtototelling telling Tell onlythe thegood goodsides sides only Activelylook lookfor formore moredistribution distributionchannels channelsfor forproducts products Actively

Applications of SL in Business Organizations HumanResources Resources Human Focusononemployment employmentcreation. creation. IfIfnot notnecessary, necessary,nonoreplacement replacementofoflabor laborwith with Focus technology technology Donot nottake takeadvantage advantageofofemployees employeesininallallaspects aspects Do Developskills skillsand andknowledge knowledgeofofemployees employeestotoallow allowthem themtotomake makeinformed informed Develop decision-makingregarding regardingtheir theirwork. work. This Thisisistotobenefit benefitcustomers customersand andorganization. organization. decision-making Developcareer careersuccession successionplan plantotoensure ensurebusiness businesscontinuity continuity Develop Givepriority prioritytotoemployees employeesdevelopment, development,because becauseemployees employeesare arekey keytotosuccess successofof Give theorganization. organization. Capable Capableemployees employeeswill willbebeable abletotoeffectively effectivelyrespond respondtotochanges changes the theenvironment. environment. This Thiswill willbring bringabout aboutorganizational organizationalsustainability. sustainability. ininthe

Applications of SL in Business Organizations Customers Customers Honestwith withcustomers. customers. Do Donot nottake takeadvantage advantageofofthem. them. Honest Givebest bestadvice adviceabout aboutproducts productsand andservices servicestotocustomers customers Give Keepcustomer customerinformation informationconfidential confidential Keep Maintainlong-term long-termrelationship relationshipwith withcustomers customerstotoreduce reducecost costofofacquiring acquiringand and Maintain maintainingcustomer customerbase base maintaining Usesuggestions suggestionsfrom fromcustomers customerstotodevelop developnew newproducts productsand andservices services Use Usefeedback feedbackfrom fromcustomers customersininemployee employeeperformance performanceevaluation evaluation Use UseITITtotobring bringabout aboutthe thebest bestbenefits benefitstotocustomers customers Use Developemployees employeeswho whohave havedirect directcontact contactwith withcustomers customerssosothat thatthey theycan canrespond respond Develop immediatelyand andeffectively effectivelytotocustomer customerrequests. requests. Also Alsodelegate delegateappropriate appropriateauthority authoritytoto immediately theemployees employeessosothat thatthey theycan canmake makedecisions decisionsregarding regardingthe thecustomer customerrequests requests the immediately. immediately.

Case Study on Sustainable Leadership in the Thai context Sa Paper Preservation House

The Business Environment Industry & Competition

paperfactories factoriesare aremostly mostlylocated locatedininthe thenorth northand andfamily familybusinesses. businesses. There Thereare are66 SaSapaper industrialpaper paperfactories, factories,but butmany manysmaller smallerfactories factorieslocated locatedininChiangmai, Chiangmai,Lampang Lampangand and industrial Bangkok Bangkok Domesticmarkets marketsare areininlarge largecities citiessuch suchasasBangkok, Bangkok,Chiangmai, Chiangmai,Songkla, Songkla,and andChonburi Chonburi Domestic Majorinternational internationalmarkets marketsare areAmerica, America,Canada, Canada,Germany, Germany,Sweden, Sweden,Australia, Australia,Japan, Japan, Major Koreaand andTaiwan Taiwan Korea Slowtechnological technologicaldevelopment developmentsince sinceititinvolves involveslocal localwisdoms wisdomsand andskills skillsdeveloped developedover over Slow timesince sinceancestors ancestors time Totalexport exportvalue valueisissmall, small,ininrelation relationtotoother otherhandicraft handicraftproducts, products,but butisisgrowing. growing. Total Competitionisisfrom fromChina, China,Laos, Laos,and andBurma Burma Competition

The Business Environment Challenges & Obstacles

Dispensableproducts productswith withshort shortlife lifecycle. cycle. Requirements Requirementsfor forproduct productstyles styleschange changeoften. often. Dispensable Easytotoproduce produceand andcopy. copy. Anyone Anyonecan cando. do. Easy Similarproducts productsininthe themarket. market. Therefore, Therefore,innovation innovationininproducts productsisiskey keytotosuccessful successful Similar competition. competition. Mostraw rawmaterials materialsare areimported importedfrom fromnearby nearbycountries. countries. Therefore, Therefore,cost costisishigh. high. Other Other Most competingcountries countriesalso alsospeed speedupuptheir theirproduct productdevelopment developmentasaswell. well. competing Themain mainproblem problemisisimproper improperwaste wastewater watermanagement managementand andnon-lasting non-lastingcolor color The Foreignmarkets. markets. Therefore, Therefore,need needpeople peoplewith withforeign foreignlanguage languageskills. skills. Foreign Inconsistencyininpaper papersmoothness smoothnessbecause becauseititisishandmade. handmade. Inconsistency Technicaldevelopment developmentisisslow, slow,lacking lackinginnovation innovationininterms termsofofproduct productdesign designand andquality quality Technical

The Business Environment Government & External Forces

Unionprotection protectionbybyraising raisingchild childlabor, labor,environmental environmentalissues issues Union memberofofWTO, WTO,Thailand Thailandcan canexport exportmore moreoverseas, overseas,but butthis thisalso alsomeans meansThailand Thailand AAaamember hastotocomply complywith withWTO WTOpolicies policiesand andmore moreand andmore moreintense intensecompetition competition has Technologicaldevelopment developmentfrom fromforeign foreigncompetitors competitorswhich whichraises raisesthe thestandard standardofof Technological products products

The Business Environment Local Community

Thecenter centerofofhandicraft handicraftproducts productsininthe thenorth northwith withreputation reputationininsasapaper paperproducts productsand and The souvenirs souvenirs Citylife lifestyle. style. Main Mainoccupation occupationofofpeople people(80%) (80%)isissasapaper papermaking. making.The Thesocial socialstructure structurewas was City changedfrom fromfarming farmingtotomaking makingsasapaper paperand andsasapaper paperproducts, products,because becausethey theycan canmake makebetter better changed income. income. Ricefarming farmingcan canonly onlybebedone doneonce onceaayear yearbecause becauseofofdrought. drought. Therefore, Therefore,people peoplesold soldland land Rice andchanged changedtheir theiroccupation occupationtotosasapaper papermaking. making. and Certainpeople peoplewho whoare arerespected respectedbybythe thecommunity communityare areAunt AuntFongkam Fongkamบุบุงงคํคําาตาอ ตาอาายยหลหลาาปปนนตาตา Certain ยายเตียยมมยานั ยานันน และและยายเตี Peoplewho whoare areperceived perceivedasasgurus gurusininmaking makingsasapaper paperproducts productsare areAunt AuntFongkam Fongkamand andher her People husband husband

Sa Paper Preservation House Communitybusiness businesswith witharound around500 500members. members. Has Hasbeen beenaround around Community formore morethan than4040years. years. Managed Managedand andled ledbybyAunt AuntFongkam Fongkamand andher her for husband. husband. Startedsmall smallwith withthree threefamily familymembers. members. Gradually Graduallyexpanded. expanded. Started 80%ofofproducts productsare areexported exportedinternationally internationallyfor formore morethan than2525years years 80% Rawmaterials materialsare arefrom fromlocal localcommunities communitiesand andnearby nearbycountries. countries. Raw Eachmember membermakes makes3,000 3,000––10,000 10,000baht bahtper permonth. month. Each Receivedmany manyawards awardsfor forexcellence excellenceininproducts products Received OTOPfive-start five-startproducts products OTOP “ในหมูบบาานต นตนนเปา เปามีมีกการทํ ารทําากระดาษสาหลายที กระดาษสาหลายที่ แต ่ แตคคุณ ุณภาพไม ภาพไมเหมื เหมืออนกั นกับบปปาาฟองคํ ฟองคําาลูลูกกคคาาเลยไม เลยไมคคออยย “ในหมู งคูแแขขงงจึจึงงไม ไมมมีปีปญ ญหา หางานเราทํ งานเราทําามาเรื มาเรื่อ่อยยๆๆพยายามพั พยายามพัฒ ฒนาให นาใหททันันสมั สมัยยตามความนิ ตามความนิยยม” ม” มีมีเรืเรื่อ่องคู สมาชิกก–– –เกษร คํ า สอน –เกษร คําสอน สมาชิ

Highlight: Manufacturing Localwisdom. wisdom. Mastery Masteryatatproduction productionprocess process Local Benatural naturalasasmuch muchasaspossible possible Be Goodplanning planningofofraw rawmaterials materials Good Recycleraw rawmaterials materials Recycle Respondtotodomestic domesticand andthen theninternational international Respond demand demand Productdiversification diversificationtotoreduce reducerisk risk Product Realizethe thenegative negativeimpact impactofofchemicals chemicalsonon Realize employees. Therefore, Therefore,use usenatural naturalmaterials materialsasas employees. muchasaspossible. possible. much

“จะเนนนแต แตคคนที นทีช ่ อบธรรมชาติ อบธรรมชาติออยยาางเดี งเดียยววถถาาคนที คนที่ ่ “จะเน ่ช ไมชชอบธรรมชาติ อบธรรมชาติเราจะไม เราจะไมรรับับบางคนมานี บางคนมานี่บ่บอกว อกวาา ไม ผมจะให อ อเดอร ค ณ ุ นี ส ่ องแสน ภายในเดื อ นเดี ผมจะใหออเดอรคุณนี่สองแสน ภายในเดือนเดียยวว เราก็จจะไม ะไมรรับับเพราะเขาจะเอาด เพราะเขาจะเอาดววนนถถาาเกิ เกิดดมีมีฝฝนตก นตก เราก็ มามันนก็ก็ททําําบบไไดดแต แตททําําเท เทาาทีที่ท่ทา ํ ได ไดบางคนบอกว บางคนบอกวาา ขึขึ้น้นมามั ํา ป า วั น นี ส ้ ง ่ ั กระดาษสั ก ห า พั น เน อ อี ก สองสามวั มา ปาวันนีส ้ ง ั่ กระดาษสักหาพันเนอ อีกสองสามวันนมา เอาเน อ ป า ก็ บ อกว า ทํ า เท า ที ท ่ า ํ ได อ า ว ทํ า ไมถึ ง เอาเนอ ปาก็บอกวาทําเทาที่ทําได อาว ทําไมถึงววาา เลาาออาาวถ วถาาสัสั่ง่งวัวันนนีนี้ แล ้ แลววสองวั สองวันนฝนเกิ ฝนเกิดดตกทั ตกทั้ง้งสอง สอง งังั้น้นเล วั น มั น ก็ บ ไ  ด ท า ํ หน า ฝนนี ท ่ า ํ ได แต ท า ํ ได บ น  ก ั ได วัน มันก็บไดทํา หนาฝนนี่ทําได แตทําไดบนัก ได ครึ่ง่งเดี เดียยว” ว” ครึ –ปาาฟองคํ ฟองคําา–– –ป

Highlight: Raw Materials Management Purchaseraw rawmaterials materialsfrom fromthe thelocal localand andnearby nearby Purchase communities. Some Sometimes timesfrom fromLaos. Laos. communities. Plant“sa” “sa”trees treesininChiangrai Chiangraionon400 400rais raisofofland landasasaabackup backup Plant forfuture futureexpansion expansionand anduncertainty. uncertainty. And Andhire hirelocal localpeople peopletoto for takecare careofofthe theland. land. take Payfor forraw rawmaterials materialsand andlabor laborfirst. first. Honest Honestwith withtrade trade Pay partners. partners. Reducecost costbybyrecycle recyclethe thewasted wastedsasapaper paperproducts. products. Reduce “ปาาคิคิดดไปถึ ไปถึงงเมื เมื่อ่อกกออนนี นนี้ กระดาษสานี ้ กระดาษสานี่ค่คนกลางจะได นกลางจะไดเงิ เงินนดีดีอย อยาางเปลื งเปลืออกสาซื กสาซื้อ้อมาจากที มาจากที่น่นูนูนพวกไป พวกไป “ป เก็ บ เปลื อ กสานี ก ่ แ ็ ม ว อี ก อ  มู เ ซอ ไปเก็ บ ในป า บนภู เ ขา...ใช เ วลาเป น คื น ได ส ก ั สิ บ กิ โ ล กิ โ ลละ55 เก็บเปลือกสานีก ่ ็แมว อีกอ มูเซอ ไปเก็บในปาบนภูเขา...ใชเวลาเปนคืน ไดสก ั สิบกิโล กิโลละ บาท ได แ ค 50 บาท สงสารเป น  ก็ เ ลยขึ น ้ ราคาให อย า งที เ ่ ชี ย งใหม สามี เ ยอะแยะแต ไ ม ม ค ี นไปเอา บาท ไดแค 50 บาท สงสารเปนก็เลยขึ้นราคาให อยางที่เชียงใหม สามีเยอะแยะแตไมมีคนไปเอา งวันนละร ละรออยยั ยยังงไม ไมมมีคีคนทํ นทําาเลย เลยปปาาก็ก็เลยไปปลู เลยไปปลูกกไว ไวททําําเอง เองเป เปนนทีทีด ่ อยเป อยเปล  ประมู ประมูลลเอา เอาพอปลู พอปลูกกเสร็ เสร็จจก็ก็มมี ี จจาางวั ่ด ล คนมี ง านทํ า ตอนหลั ง ใครสั ง ่ ออเดอร เ ราก็ ส บาย เพราะว า เรามี ว ต ั ถุ ด บ ิ แน น อนแล ว ” คนมีงานทํา ตอนหลังใครสั่งออเดอรเราก็สบาย เพราะวาเรามีวต ั ถุดิบแนนอนแลว” –ปาาฟองคํ ฟองคําา–– –ป

Highlight: Product Management Focusononnatural naturalproducts products Focus Highcreativity creativityininterms termsofofnew newproduct productdesigns designssuch suchasasnote note High book,ICU ICUgowns, gowns,flowers. flowers. book, Takecustomer customerfeedback feedbackononproducts productsseriously seriously Take Keepcustomer customerproduct productdesigns designsconfidential confidentialfrom fromcompetitors competitors Keep

“บางทีฝฝรัรั่ง่งมาบอกว มาบอกวาานีนี่ส่สธ ี รรมชาติ รรมชาติเนอะ เนอะใส ใสเปลื เปลืออกมั กมันนดดววยใส ยใสออะไรด ะไรดววยย “บางที ีธ อยาางนี งนี้ม้มันันออกเหลื ออกเหลือองงมัมันนบบคคอ  บขาว บขาวเป เปนนจํจําามาบอกว มาบอกวาาทํทําาไมมั ไมมันนไม ไมคคออบขาว บขาว อย อ ป า ก็ ว า  มั น บ ไ ด มั น เป น ธรรมชาติ ฝ น กั น บ ไ ด มั น เป น งานที ส ่ ม ั พั น ธ ก บ ั ปาก็วามันบได มันเปนธรรมชาติ ฝนกันบได มันเปนงานที่สัมพันธกบ ั ฟฟาากักับบ ฝน มั น เป น ธรรมชาติ แ ท ๆ นะ บ ไ ด ด ด ั แปลง” ฝน มันเปนธรรมชาติแทๆ นะ บไดดด ั แปลง” –ปาาฟองคํ ฟองคําา–– –ป

Highlight: Customer Management Honestwith withcustomers. customers. Understand Understandthe thebenefit benefitofof Honest buildinglong-term long-termrelationship relationshipwith withcustomers customers building Takecustomer customerfeedback feedbackininproduct productdevelopment developmenttoto Take reducemarket marketrisk risk reduce Respondtotodomestic domesticcustomers customersfirst. first. Then Then Respond internationalcustomers customers international Foreigncustomers customersinitially initiallyhelped helpedininexporting exporting Foreign productsoverseas overseasbecause becauseofofthe thelack lackofofEnglish English products languageskills. skills. Even Eventhe thename name“Sa “SaPaper Paper language ReservationHouse” House”was wasgiven givenbybyaaforeign foreign Reservation customer. customer.

Highlight: Environmental Management Theonly onlyplace placeininthe thecommunity communitywith withself-invented, self-invented,proper properwaste wastewater watermanagement management The Recycleofofraw rawmaterials materials Recycle Minimizethe theuse useofofchemicals chemicalsininthe theproduction productionprocess process Minimize

Highlight: Finance Management Gradualexpansion. expansion. Expand Expandonly onlywhen whenthere thereisisenough enoughprofit profitleft. left. Gradual Initially,there therewas wasnonobank bankloan, loan,although althoughbankers bankerscame cametotothe thefactory factorytotooffer offerloans. loans. Initially, Regularsaving savingfor forfuture futureuncertainty uncertainty Regular

leftover Income Expense

$$$

Cash for daily use

$$$

2nd reserve for long-term use

1st reserve for short term use

leftover

Highlight: Human Resources Management Employmentcreation creationbybyhiring hiringpeople peopleininthe thenearby nearby Employment communitiestotoplant plantthe the‘sa’ ‘sa’trees trees communities Trainstaff stafftotohave havemoral moraland andethical ethicalprinciples. principles. Preach Preach Train themnot nottotoborrow borrowtoo toomuch muchmoney moneythat thatthey theycannot cannotpay pay them back. This Thisisisbecause becausewhen whenstaff staffare arenot nothappy, happy,they they back. couldimpact impactnegatively negativelythe theproducts productswhich whichrequires requiresaalotlot could creativity. ofofcreativity. Treatstaff staffasasififthey theywere werefamily familymembers. members. Give Giveout out Treat loanstotostaff staffwithout withoutinterest. interest. Teach Teachthem themtotosave saveone one loans bahtevery everyday. day. baht Focusononemployment employmentcreation. creation. Do Donot notreplace replacestaff staffwith with Focus machineorortechnology technologyunnecessarily, unnecessarily,because becausesasaproducts products machine areananartartwork. work. are Honestwith withstaff. staff. Do Donot nottake takeadvantage advantageofofthem. them. Pay Pay Honest themfirst firstevery everytime timethere thereisisaabill billpayment. payment. them

Conclusion Equilibrium & Sustainability Theresult resultofofpracticing practicingalong alongthe theSL SLatatSaSaPreservation PreservationHouse: House: The 9Canrun runthe thebusiness businesssuccessfully successfullyfor forover over4040years, years,nonomatter matterhow howupupand anddown downthe theThai Thaiand and 9Can world’seconomies economieshave havebeen. been. This Thisshows showsthe theability abilitytotorespond respondtotothe thechanging changingconditions conditions world’s fromwithin withinand andoutside outsidethe thecountry. country. from 9Createemployment. employment. People Peopleininthe thelocal localcommunities communitieshave haveaabetter betterquality qualityofoflife. life. Therefore, Therefore, 9Create theycan candeliver delivermore morecreativity creativity&&innovation innovationtotothe theproducts, products,which whichisiskey keytotocompete competeininthe the they world’smarket, market,particularly particularlyfor forthis thiskind kindofofbusiness. business. world’s 9Bringabout aboutthe thecontinuation continuationofoflocal localThai Thaiwisdoms wisdoms 9Bring 9Readytotoadapt adapttotothe thechanging changingrequirements requirementsofofforeign foreignmarkets marketsbecause becauseofofhighly highlyskilled skilledand and 9Ready creativestaff staff creative 9Canalways alwaysbring bringabout aboutinnovative innovativeproducts productstotodifferentiate differentiateitsitsproducts productsfrom fromother otherproducts productsinin 9Can themarket market the

Conclusion Next Steps to Advance SL

9Technology Technologydevelopment developmentininnatural naturalcolors colorsand andwaste wastemanagement. management. The Thegovernment governmentsector sector 9 canlend lendaahelping helpinghand. hand. can 9Management Managementdevelopment developmentfor formangers mangersand andstaff stafftotoensure ensurebusiness businesscontinuity. continuity. AtAtpresent, present,itit 9 seemsthat thatevery everydecision decisiondepends dependsupon uponMae MaeFong FongKam Kamand andher herhusband. husband. Again, Again,the the seems governmentsector sectorcan canalso alsohelp helpdevelop developmanagement managementskills. skills. government 9Since SinceSaSaPaper PaperPreservation PreservationHouse Houseisisfar farahead aheadofofother othersasapaper paperbusinesses businessesininthe the 9 community,ininterms termsofofproducts productsand andtechnology, technology,there thereisisaawide widegap gapbetween betweenthe the community, PreservationHouse Houseand andthe therest restofofthe thebusinesses businessesininthe thecommunity. community. People Peoplestart startdisliking disliking Preservation MaeFong FongKam, Kam,causing causingdifficulty difficultyininliving livingpeacefully peacefullyininthe thecommunity. community. Therefore, Therefore,Mae Mae Mae FongKam Kamshould shouldseriously seriouslyconsider considerhelping helpingother otherbusinesses businessesininthe thecommunity communitysosothat thatthe the Fong gapcan canbebebridged. bridged. gap 9Moreover, Moreover,ininthe thefuture, future,allallsasabusinesses businessesininthe thecommunity communitycan canwork worktogether togetherasasaacluster clustertoto 9 negotiatepricing pricingand andetc. etc. This Thisisistotostay staysmall, small,but buttake takeadvantage advantageofofbeing being“big”. “big”. negotiate Eventually,the thewhole wholecommunity communitywill willbebesustainable, sustainable,achieving achievingthe theSL SLprime primeobjective. objective. Eventually,