Author Topic: Nakhon Ratchasima & CPF's successful strategy  (Read 1676 times)


  • Guest
Nakhon Ratchasima & CPF's successful strategy
« on: April 30, 2010, 08:09:29 AM »
CPF's successful strategy

There are many secrets behind the success of Charoen Pokphand Foods, but according to the company's senior vice president Nopphadon Sirijongdee, many of its accomplishment stem from an ability to run the giant conglomerate as if it remains a small enterprise.

Nopphadon said one of the best things he gained from implementing the Thailand Quality Award (TQA) framework at Bangkok Produce Merchandising (BKP) - one of CPF's 75 subsidiaries - was, "it brought me back, as if [I were managing] a small company again".

As CPF has grown very large over the years, Nopphadon said the scope of responsibilities for each executive had been reduced. In his case, for example, he once took care of an integrated line of businesses, from farms to processing factories. Now, as senior vice president for food processing and poultry business, he is responsible for the company's Saraburi and Nakhon Ratchasima processing facilities.

Nevertheless, he found that in implementing the TQA framework, which requires an integrated approach to business, executives and staff from different units were stimulated to sit back, discuss and recognise the same corporate goals, he said.

BKP and three other Thai companies were recently named winners of the Thailand Quality Class Award 2009, based on the TQA criteria, which, in turn, are modeled on the Malcolm Baldrige National Quality Award in the United States, in recognition of their excellence in business management.

Speaking to The Nation in an exclusive interview, Nopphadon said CPF had also thrived on the "two highs, one low" business principle expounded by Charoen Pokphand Group chairman Dhanin Chearavanont. This stands for high investments and high efficiency, but low cost.

Evidence of this was CPF's huge Bt8-billion investment made six years ago in its integrated feed-to-food complex covering 4,000 rai (640 hectares) in Nakhon Ratchasima province - the largest of its kind in the world, he said.

"It was unbelievable at first, but eventually it [the Nakhon Ratchasima complex] turned into a profitable operation," Nopphadon said.

Initial investments in chicken farms alone at the Nakhon Ratchasima complex exceeded Bt1 billion baht, and this was able to provide only 25 to 30 per cent of the processing requirements. CPF chicken farms now employ just one staff member per 100,000 chickens.

Leadership is one of the TQA criteria, and Nopphadon recently demonstrated his recognition that leadership and management visibility are vital to a company's success. He drove from the company's Bangkok headquarters to spend three nights with his staff at the BKP factory in Saraburi after hearing that red-shirt protesters from the North and Northeast would be travelling through Saraburi on their way to the anti-government rally in Bangkok. All he ended up doing was chatting and playing badminton with his staff.

"Company is not tangible," Nopphadon explained. "It's the executives who matter."

The Nation