From Business Excellence to Sustainable Excellence

Okay, this is the second day of the PSQ World Quality Week. So, welcome once again. So, I'll be your host for today. I'm Ray, the current president of the Philippine Society for Quality and I'll be your speaker as well for for today. It's really amazing. Um the webinar yesterday was success and thank you so much for being with us and I hope that you learned something from yesterday's session and you're able to apply it in your in your own organization. So the topic for today is definitely something that let me just move this chat box that I can see right here but you know you can always use the chat box as I mentioned it yesterday. Um, should you have any questions or any of the takeaways, any insights that you may have, please use the chat box in here. I'll definitely answer all those questions or if you have some questions, please put it right here in chat box during our Q&A. By the way, during the or for the next five days or for the next four days or three days at this point, so PSQ will bring you different um webinars or series of free webinars designed to strengthen the capability of our community um when it comes to quality, sustainability um to systems and even to human centered excellence all leading to the culminating activity on November 21st which is the general membership meeting and the year end party. So, we're going to have that on Friday, right? They are at Richmond Hotel in Ortigas. Um I can see here, may I request reading materials from yesterday's um session? Okay, we'll definitely send you over um it can be within the week or after this week in terms of the materials that we are using for the entire week. so we can send it over to you guys because at this point what we're focusing more on is the webinar but we'll send over the materials um after this we so most likely we can send it over to you guys um by the way for the certificate that you're going to get it's automated um it's verifiable as well it's a digital certificate that you can get after our session please make sure that you subscribe to the Viber community of PSQ um at the same time our secretariat is not going to accomp accomodate any of the or those ones who are requesting for the links via email. So you have to stay right here in our webinar so that you can get that link later on. So I'll be sharing that link where you can um access the the post survey at the same time you can access your certificate uh via email that's automatically um done with our partnership with Philpass. So make sure to access your make sure to to be here up until the end of the session so you can get the certificate because we're not going to accommodate any more any any requests after the webinar. Okay. So just want to make sure that we are aligned that I set the proper expectations when it comes to the certificate uh certificates. Is the yesterday's link still available? Unfortunately, it's not available anymore um in terms of the link for yesterday. So you have to wait for until the end of this session for you to get the certificate for today's session. Okay. Okay. So let's move forward. Um this is a very important topic. This is from my perspective. This is both urgent and transformative in terms of this topic from business excellence to sustainable excellence. I got inspired actually with uh or some of the presentations um of one of the tenants of the international academy um for quality on sustainability and I believe that this is one of the key things that I need to to share to the community because this is something that I'm super passionate about when it comes to sustainability. If you look at like years years ago like organizations have pursued excellence through efficiency um through productivity and through performance and those principles remain important right these principles are definitely important but today's world definitely demands more. So if you look at the surroundings that we have, if you look at the environment, climate reality, societal expectations, the generational shift, the rise of the intelligent technologies, these are the ones that are reshaping what it means to be excellent organization today. So when you look at excellence day is totally different. The reason why we crafted a different theme for the entire year which is all about sustainable excellence or it's really centered around sustainable excellence is because we are redefining what excellence is all about. Excellence is no longer just about how we or how well we operate. It's really more about how we responsibly create value for the people that we serve or for the people for the society and for the planet. And that's what this session is all about. So as the Philippines site for quality continues to grow, evolve and lead, we always say that quality is not only standard, it's definitely a commitment. It's a responsibility. It's a journey. It's a journey toward purpose-driven and sustainable excellence. That's why all throughout the year, you've been hearing you've been hearing from PSQ, right? You've been hearing from us um those different terms um purpose- driven excellence of sustainable excellence is because that's the new term. It's that's just a new term but it's really the new definition of excellence. So in the next hour I will take you through the first one is why traditional business excellence must evolve. That's the number one. The second one is how sustainability reframes value creation. I'll also share with you the systems view of enterprise society and environment and how AI and intelligence amplify sustainable transformation. And the last part of it is what leaders must do today to prepare for tomorrow's realities. So again, welcome everyone to this webinar. Let's begin with uh with this webinar with um with the purpose. Why are you here today? Just make sure that it's intact in terms of the purpose. Why you are here today? You're here today not just because of the certificate, but you just you you're here. It's because you want to learn something something new from the quality realm because this is something that's evolving and I want to share with you more insights all throughout the webinar. I want to to what do you call it to awaken that consciousness within you when it comes to this topic. I'll I can I can promise that you can get something coming from this webinar. So, let me start with a very um simple example, something that we all relate to here in the Philippines, air con, right? Air conditioning. We all know how guts it's um I mean how hot it gets now, how or or when you look at the the the environment right here in the Philippines, it's much hotter than 10 or 10 to 15 years ago. So, what do we usually do when it gets hotter, right? What we usually do is we optimize it. We set the the thermostat for example to 25 um degrees CC. We clean the filters. We try to reduce the electricity bill. And then I've been seeing that to a lot of people from a lot of people. And from my perspective, that's what business excellence is all about, right? We improve the efficiency in the way we currently operate. So that's business excellence. But when you look at the bigger truth, even if you optimize the settings of your air con, it will never solve the larger problem. What is the larger problem that we're talking about in here? Right? It's the rising heat caused by bigger environmental shifts. So, we now begin to ask deeper questions. Why is it getting hotter? Why or what is contributing to this? How do buildings reduce heat load? Or how do we design for energy efficiency from the start? Or how can we use renewable sources to power cooling? So these are different questions, right, we need to ask now, right? Deeper questions that we need to ask now. We're no longer talking about performance, right? We're talking about sustainability, resilience, and the long-term impact. So this is why excellence need to evolve, right? Excellence needs to evolve. The world has changed significantly, right? What used to be considered excellent is no longer enough. We can no longer just optimize the existing systems. We need to rethink. We need to redesign and regenerate that system. In a usual context, when you look at business excellence, we ask how do we do things right? Right? But when it comes to sustainable excellence, we ask how do we do the right things for today, for society, and for future generations, right? And that is the shift. That shift is why we are here today. So when we talk about why excellence needs to evolve, it's not theoretical at all. Right? We are living through the different global shift as you can see in here on the screen um that every organization is already experiencing whether we acknowledge them or not. For example, the first one right super typhoons. Super typhoons is a new normal. So we see we see it every year in the Philippines. It's not just like the recent super typhoon that came here in the Philippines, but we're seeing it like on a yearly basis, right? Typhoons are becoming stronger. Um you can see a lot of flooding as well. It's more frequent when it comes to flooding and the cost of the recovery keeps rising as well. And this is no longer a once in a decade event. It's the new normal, right? If you think about it, it's really the new normal. It impacts everything. it impacts your operations, your safety, your supply chain, your employee well-being and so forth. Right? If it doesn't change how we define excellence, I don't know what will, right? So the second one is investors requiring ESG reporting. So globally when you look at it, investors and the boards are demanding um ESG disclosures. Uh for those who are not familiar with ESG yet, ESG stands for environmental, social and governance, right? So which is all about sustainability. We need to start um reporting or tracking monitoring all of the sustainability initiatives that we have. So why do we need to do that? It's because risk today is not only financial, right? It's also environmental. It's also social. It's also reputational. And organizations that cannot demonstrate sustainability or responsibility may soon lose funding or partnerships because it's uh it's what they require now, right? It's an imperative to to most of the businesses to all of the industries. So excellence must now include transparency. The next one is the Gen Z, right? Um Gen Z demanding ethical companies. I love Gen Z because they're they're very clear about what they want. I love the authenticity coming from the Jensen integrity that purpose I love that I mean these are the the terms that I've been hearing coming from the genesis because I've been um teaching as well from um Delasal College of St. Benil. So that's the only like undergrad um where I teach but the the rest I teach at the graduate school but I see it like a lot coming from the GNC of today right they want employers who care about well-being who care about impact who care about social responsibilities and they will not join or stay in a companies that do not align with their values. So talent is choosing culture over compensation and that changes everything, right? I love this. I love uh I'm I'm I'm reading the the comment from Roberto. Thank you so much for sharing that excellence is not an act but a habit that sustainable excellence comes from making responsible um valuedriven choices is part of everyday behavior not to facial efforts. That's amazing. Thank you so much for that. So let me move forward. Number four is customers choosing sustainable brands. Um look at how we buy today, right? You can see a lot of the echofriendly packaging, the cruelty-free cosmetics, the reusable um products, the low-waist options. Customers vote with their wallets. They are rewarding brands that act responsibly and they actually punish those that do not. And excellence cannot be purely operational anymore. If you think about it, it must be ethical, right? And number five, AI, right? AI amplifying everything whether good or bad. And we've been talking about AI for the past years, I think three years or four years now. We've been talking about the generative AI, agentic AI now. So so many things, so much discussion when it comes to AI. But one thing that I know of about AI is that it accelerates everything. AI accelerates everything. If a process is flawed, AI will amplify the flaw. Right? If a process is inclusive and sustainable, AI makes it scalable. So the question is no longer are we using AI, right? That is not the question anymore. The real question now is what kind of system are we amplifying? Right? What kind of system are we amplifying? Because good systems become great but broken systems become dangerous. And that's what happened. I mean that's what's happening now with our government. There's a lot of broken systems in there. So it's pretty dangerous. What are we amplifying? What kind of system are we amplifying? It's very dangerous. Um so these types of global shifts, right? These are signals. They are telling us that the world has changed and our definition of excellence must change with that. Right? Otherwise, we are optimizing for a world that no longer exist. So that's the takeaway of this specific slide that you can see right now. Now let's zoom out and look at the bigger picture because excellence makes no sense unless we understand the system we operate in. So this is the system view, right? We often assume that our work happens only at the level of the enterprise. And this is what I want you to think about at this point because most of the time this is what we think about. We're part of a company, we're working for a company or we have our own company. So we thought that it's all about the enterprise, right? It's all about the KPIs, the processes, the people, the profit targets that we have, the profit margin that we need to to hit. But the truth is the enterprise does not exist in isolation. It exists inside the society and the society exists inside the environment. So think about that. It's very simple if you think about this but this is the truth right? This means that every operational decision has societal consequences and every societal shift has environmental implication and every environmental eventually becomes a business issue. Right? Let me break it down. So let's look at the enterprise. So when you look at the enterprise to the society, the relationship between the two, the enterprise affects society through what? the jobs you create, the stress levels of the employees, the community engagement, the accessibility of your products, the safety, the fairness, the equity and so forth, right? And if society collapses, market collapse too, right? A lot of the markets would collapse. So if society collapses, markets collapse. If communities weaken, talent weakens as well. So business cannot succeed in a community or in a society that is failing. So I want to repeat that that businesses cannot succeed in a society that is failing. So let's look at the society to environment right society to environment. Our society depends on environmental stability. You have the clean water, stable weather, um safe food, reliable energy, livable cities. I I believe we've been talking about the livable cities for um x number of years now. And if all of these are threatened, society becomes vulnerable and the enterprises feel the impact instantly. Now if you look at the environment to the enterprise, if you think about the Philippines, if you think about our country, maybe some some of our participants are coming from um abroad or or these are not Filipinos who who join in our session for today and you are welcome definitely to this webinar. If you think about our country, the Philippines, right, we have power outages, uh we have um the heat waves, we have a lot of the flooding, infrastructure damages. We also saw that for the past um for the past years. One environmental event can shut down an entire industry for how many days or for how many weeks, right? So if you think about this, this is no longer external risk. This is the operating system of every organization now. So what is the message that I want to share with you? What I'm trying to say is that you don't fix the system by optimizing the parts. You fix the system by understanding the relationships. And this is why sustainable excellence is non-negotiable. It reminds us that enterprise exists to serve the society and then the society relies on a stable environment and when the environment suffers everyone suffers organizations included enterprises included your companies included right so what I'm trying to say is that excellence must evolve because our system has evolved and if we continue improving only the enterprise like we like learning um attending to a lot of the conferences and all of the things that we've been hearing is really more about um the best practices, how do you automate processes and these are all like enterprise level. If we continue improving only the enterprise while ignoring the society and environment around it, we are building excellence on a collapsing foundation. Do you agree? So I think that's the message I want to say that I want to share with you when it comes to this topic. So let me share with you a couple of examples where you can see the systems view the enterprise the society and then the environment. So let's start with something we all see every day. That's the delivery riders. Um Laamu, you have the Grab, you have the food panda, right? On an enterprise level that for the platform, the Grab, the Laamu, and then the whatever, right? Food panda. The rider is part of the operational efficiency, right? You have the delivery time, you have the customer satisfaction, you have the ratings, the daily quotas, and so forth. And that's the enterprise perspective. When you go to the society level, when you look deeper, the rider is actually part of the society. His safety on the road, his income is stability, his working conditions, his role in keeping the the items or keeping the goods, the orders moving, right? And when the motorcycle accidents increase, when fuel um prices rise, when the heat waves affect their health, that's no longer just business. That is a societal issue already, right? And when you go deeper, when you go to the environment level, right, the weather directly affects the rider, the strong rain, the extreme heat, the poor air, I mean the the the pollution, the air pollution or the poor air quality, the flooded roads. So environmental changes alter his work. It also alters his safety and customer expectations. So you see the layers right from the environment, the society to enterprise or vice versa, the enterprise, society, environment. So this is the systems view in action. If you only optimize the enterprise, you're missing the real system that sustains it. So let me give you another example. This one is like the BO operations right here in the Philippines. This is the sector that the Philippines depends on massively, which is the BO operations. At the enterprise level, BPOS's focus on you have the uh what they call the HT average handle time. You have the customer satisfaction or the seesat, you have the SLAs's or the service level agreements work for scheduling process compliance and so forth. But again, the system is much bigger than the enterprise, right? So when you look at the society level, BO employees usually face night shift stress, commuting safety. You have the mental health pressures as well. Um the family dynamics because of the work hours. So if public transportation is unreliable or unsafe, attendance drops. If communities are affected by flooding, agents cannot log in. And this is not an operations issue anymore. This is a societal issue manifesting inside operations. And when you look at the environmental level, if you go deeper, right, if you think of the power outages, if you think about the typhoons, the long heat waves increasing electricity failures. So one typhoon can shut down an entire site of a BPO company. One week of heat wave can overwhelm power grids and one flood can prevent 200 agents from reporting to work or more agents. They cannot report to work, right? Your absentism definitely will go higher. So we often treat these as external disruptions, but the reality is the environment is part of the business model, right? Whether we acknowledge it or not, it's actually part of the business model. This is why excellence must evolve. We cannot manage operations effectively if we ignore the system surrounding these operations. How about this third example I want to share with you? It's a simple cafe. Um we're talking about like a restaurant or a cafe, something we all love, right? At an enterprise level perspective, the cafe manages um your customer service, the quality of the food and the drinks, the cleanliness, the profit margins, inventory and so forth. That's the usual thing that they manage from enterprise level perspective. But again, the cafe sits inside the bigger system, right? The society level, if you look at it, they provide jobs to baristas and service. They influence community culture. They shape the customer's life um lifestyle of customers. So they respond to societal expectations like healthier options, ethical sourcing and fair employee treatment. So customers today they do not ask anymore, they also ask responsible ba right. So expectations definitely coming from the customers are changing. And if you look at the environment level, a cafe is directly affected by environmental factors. Um the coffee bean supply depends on the climate, right? If you think about that, the food quality depends on the sustainable sourcing. Energy cost affects or affects your operations. Waste management affects community cleanliness. So even the simple choice that we make for example the singleuse plastics the compostable materials the recycling bins they contribute to sustainability. So if I want to bring it um together when it comes to this example this cafe they not only they not only serving the coffee anymore it's serving the society and the society is shaped by the environment and this is the interconnected system where sustainable excellence must operate. When we look at organizations through the system lens, whether it's the writer that we were talking about earlier or a BO agent or a cafe, we begin to see the truth that excellence isn't only about running the business well. It is about understanding the world the business lives in. So now we've been um we've seen the system C right the enterprise inside the society and the society inside the environment and I want you to pause and ask you a very important question at this point where does your organization spend most of its energy today within the enterprise or beyond it? So I want you to pause and think about this question that you can see right here on the screen. Where does your organization spend most of its energy today? Within the enterprise or beyond it? So let me explain why this question um matters to a lot of us because most organizations spend 90 to 95% of their time and resources inside the enterprise layer because we love to talk about the processes the highole the KPIs the benchmarking the cost control productivity um customer experience the tools and different systems the compliances but I'm not saying that that's wrong right that's not wrong it's actually necess necessary. But from my perspective, while it is necessary to talk about those things, to look at those things, it is incomplete because the real forces shaping performance, the things that can shut down your operations or accelerate your growth often live outside the enterprise. So if you think about outer layers, right, the society layer, so these are your customers, your workforce, your communities. So if society is unstable, disconnected or it's stressed, your operations feel it immediately. Your workforce wellbeing, public transportation, your community safety, these are not external issues anymore. They are part of your performance ecosystem. When you look at the environment layer in here, uh we talked about the climate change earlier, climate, energy availability, the weather, the resources. Um, one super typhoon can do more damage to operations than 100 process defects, right? One heat wave can increase absentism and power outages and one motor scarcity issue can close a plant. And yet few organizations allocate time and governance or strategy to this outer layer. We usually focus on the inside one. So this is the heart of sustainable excellence. Sustainable excellence. Ask organizations to look beyond their four walls and ask what societal pressure uh what societal pressures shape our operations? What environmental forces threaten our sustainability? What responsibilities do we have beyond profits? And what value can we create for future generations? So again, please reflect on this. Are we spending our energy only on what is convenient to measure or on what really matters for long-term success? So, enterprise, society, environment, where does your organization focus today? So, I want to give you um couple of seconds if you can share right here in the chat box. Be honest. There's no there's no harm in sharing at this point. At least you know where you are at this point. I mean with the companies that you're part of. Where does your organization focus today? Are you just focusing on the enterprise? Are you just focusing on enterprise of society? Or are you now looking into the environment? So let me give you a couple of seconds for you to think about it. Are we still focusing on the enterprise? Are we focusing now on including the society or are we now including environment? So you can use the chat box in here. I'm curious what are your thoughts from Roberto. From architectural engineering design point of view in Dubai building designs depend heavily on market demand society. We also look at sustainability, sustainable design, care to environment. That's amazing. Thank you for that. Uh for Rafino, I think our company focus its energy within the enterprise specifically in maintaining and growing its core business or product um distribution, performance, innovation. Thank you for that. How about the others? And there's no um um there's nothing wrong in terms of just focusing on the enterprise at this point. What I'm trying to say is that perhaps you now need to start considering talking about the society and then the environment is because later on that will be imperative. If you don't act on if you don't start talking about it now you'll you'll not only lag behind you'll be out of the market because a lot of your suppliers a lot of your partners a lot of your customers will demand that you need to focus on that. So for Paul is the mandate of BSP to incorporate sustainability into organization. Um JP um as an ISO practitioner I now advise my assisted organization to look into the environment factor as ISO now includes environment management in every um ISO outside um ISO 14,0001. That's great. So now it's a mandate. I think that's a that's a great one. Our university incorporates environmental sustainability in every aspect of its planning and activities. That's great. Okay, it's really nice. So, please share right here in the chat. Please keep on sharing um any of your insights or what they're currently doing now. So, so I'll just want to cap off this like systems view right that we're talking about before I proceed to my the next slides. Um for me just to summarize the points that I'm making is that when we shift our focus beyond the enterprise we stop reacting and we start leading and I believe we want to make sure that we are leading. So we now need to rewire business excellence from the traditional model to sustainable model. So let's talk about the core transformation. The start would be the primary shift focus in here right for so many years business excellence is centered around the three things usually it's about efficiency it's about profitability it's about process improvement and as I mentioned earlier there's nothing wrong with that in fact these are essential right but here's the issue when it comes to that because these priorities were designed for a world where resources were um abundant your environmental stability was assumed and your societal expectations were much lower. When you look at today's world, it's completely different. That's why we are having this kind of webinars. It's totally different. So, I'm challenging you to look at things from different point of view because the question now becomes what does excellence look like in a world facing climate risk um inequality or rapid technological disruption. And this is where sustainable excellence shifts the focus toward your shared value, long-term impact and societal contribution. So let me go deeper like a little bit. When it comes to the shared value, it's not the value for me but value for the customers, value for the employees, uh value for your suppliers, for the communities, the environment and recognizing that prosperity is actually interconnected. Right? When I when I say long-term impact, I'm trying to say are our decisions contributing to resilience and continuity or are they creating short-term wins but long-term risk. Right? Societal contribution when you look at today companies are expected to be more than profit engines. They're expected to be citizens with responsibility and purpose. And that shift is not um being charitable. I believe I just want to reiterate that that that particular shift is not about being charitable. It's not making companies becoming more charity organizations, right? It's about being future proof. It's because organizations that embrace sustainable excellence create loyalty. They reduce the risk. They attract talent. They build long-term competitive advantage. And this brings me to one of the best examples right here in the Philippines. If you're familiar with this one, um, this is the Jollibee Farmer Entrepreneurship Program or FPP. So, by the way, Jollibee is known for what? If you can type in right here in the chat box, Jollibee is known for what? You can use the the chat in here. Jollibee is known for it's a Filipino pride. Yes. Giving happiness. It's really known for chicken joy, right? So most people know Jollibee for chicken joy, right? The family bonding and so forth. But it's really more about the chicken joy that we all love. So but behind the success of Jollibee is a powerful sustainability story. So years years ago, so Jollibee realized something. So instead of relying solely on imported or large scale suppliers, they thought why not empower local small um holder farmers to become part of their supply chain. And that led to the FE to the farmer entrepreneurship um program where Jollibee um trains a lot of the farmers to become agreneurs. So these are not you know um just suppliers anymore. But they are partners of Jollibee in growth. So when you look at business excellence, business excellence would say how do we secure supplies at the lowest cost, right? If that's your point of view always from business excellence perspective and as I mentioned earlier, there's nothing wrong about it. How do we secure supplies at the lowest cost? That's business excellence. But when you transition from business excellence to sustainable excellence, you will now ask how do we create shared value, right? Where the business wins, where communities win and the country and the country as well wins, right? And that's what happened with the FAP program of Jollibee. So let's look at it um in a more um closer or deeper look. Um the first one is shared value. farmers they gain stable income they gain a lot of the technical skills coming from Jollibee and definitely when you look at it right the dignity of being part of a national supply chain it also increased coming from the farmers so Jollibee gets a reliable local high quality supply of fresh ingredients because of that partnership right second one when you look at the long-term impact definitely the communities is grow the farmers move out of poverty the local agriculture strengthens the and at the same time from Jollibee perspective they now secure long-term supply resilience and when you look at the societal contribution that FEP that uh program it uplifts the entire um farming families so it supports the national food security it reduces the reliance on imports and it it stimulates the rural economies no longer just about the business excellence or if you ever pure play business excellence that we that we've been talking about for many years, this is already sustainable excellence in action. So sustainable excellence is not is not a buzz word anymore these days. It's a shift on the mindset from doing the things efficiently to doing things meaningfully. And companies like Jollibee, they show us that when organizations choose to uplift people and protect the planet, excellence becomes more than a metric. It becomes a legacy to the country. It becomes a legacy to the world. So let's move to the second major shift expanding who we consider as stakeholders. Um so from from customers the employees to shareholders for a lot of years for decades right organization define their stakeholders as customers employees shareholders and that was the entire universe by then right during those years but these were the these were the only groups that leadership strategies revolve around but here's the big realization that decisions organizations s make today impact for or far more than these three groups more than customers, employees and shareholders. We now understand that businesses exist in a much bigger ecosystem and because of that sustainable excellence broadens to stakeholder lens to include your society, your communities, your planet earth, your future generations. And maybe you would ask why does this matter, right? Because every business decision has ripple effects, right? Your supply chain affects the farmers, your transport workers and their families, your waste affects neighborhoods and ecosystem. The the the carbon footprints affects climate conditions and that future generations definitely will inherit it. Your hiring and development practices influence talent mobility and societal well-being. So in sustainable excellence, the question is no longer how do we satisfy customers, how do we satisfy our employees, um how do we retain our employees and shareholders, but rather the question is how do we create that impact that uplifts the broader system we operate in, right? Because when we widen that definition of stakeholder, you actually widen that sense of responsibility, your potential for positive impact. So, let me give you a real example of what this looks like in action. So, this one is from IKEA. IKEA um is one of the best examples of a company shifting from that linear excellence to sustainable excellence. Traditionally, the furniture industry, they operate on a linear model. When I say linear model, they make, they sell, they dispose. That's a linear model. But IKEA asked a bold question. What if our responsibility does not end at the checkout counter? So with that, this is what they launched. They launched the IKEA circular shop, which is a concept where customers can return their old furniture. Um they can um they can have their items repaired, repurposed or refurbished, buy pre-loved IKEA products at more affordable prices, extend product life cycles, reduce waste and carbon footprint. So this completely transform the business model of IKEA from that linear to circular. So what makes it sustainable when you look at it as number one society as a stakeholder right for um for the society it's affordable pe of furniture supports a lot of the low-income families and students and it reduces the financial barriers to home improvement the second one communities stakeholders now because we are ex expanding our definition of stakeholders type on communities is part of that so when you look at communities repairs and refurbishing creat create local green jobs. So skills in craftsmanship, the skills on the restoration and the waste management are developed because of that. And when you look at the planet earth as stakeholders, the circularity significantly cuts um waste. It cuts a lot of the carbon dioxide emissions and the landfill contribution and so forth. And every refurbished product means one less raw material extraction. So that's what it means. And the last one is the future generation of stakeholders. Uh when you look at IKEA, they're investing in a world where resources remain available. So they ensure that the next generation inherits a healthier planet, not a depleted one. It's because there's a lot of harm that we're doing to our environment. Now, I don't know what will what will be left to the future generation. So sustainable excellence is not only about doing less harm. It's about redesigning how value is created so everyone benefits. When I say everyone, we're talking about the company, the people, the communities and the planet. So next one, this is the third major shift. How organization define and create value. Because traditionally organization ask how do we create value for our stakeholders, right? But a word stakeholders was narrowly interpreted as customers, employees and shareholders only. Say similar with our um argument earlier. But the problem on that is that the definition is too small for the world we live in today. Um the ones that I shared with you, the climate change, the pressures from the society, the community needs, the technological disruptions, all of these they require organization to widen how value is measured. Sustainable excellence reframes value creation into a much bigger um perspective. So from the shared value um or from the value to stakeholders to shared value for all key stakeholders, right? So from value for stakeholders to shared value for all key stakeholders. And that means making decisions that benefit the business, the workforce, the society, the community, um the environment and even the future generations. And I mean that's what we uh we talked about um earlier. Um the traditional value creation usually ask how do we improve our KPIs? But a shared value creation usually ask how do we create positive impact while achieving our KPIs. totally different in terms of how you um frame the question and an example of this one is this a lot of the universities I know a lot of a lot of the universities or some of the leaders are here today they started their journey on ISO 210001 or EO EOM by the way um there's a specific webinar specific to EOS that will be facilitated by Dr. Prasadra Manz um who's also one of the officers of PSQ. So stay tuned. Please take a look at the the materials or the posters that we have. Please also register on that if you believe that you will benefit coming from coming from the that then please make sure to register. I think that will be on Thursday or November 20th. Um so please make sure to register on on that. So going back to to that example right the ISO 21,01 um a lot of the a lot of the universities now they adopting that ISO not because it is required but because they recognize the role um or their role in a much larger ecosystem and it asks a powerful question how can an education institution create value not just for the students but for society and future gener generations and that standard elevates universities from being centers of learning to being institutions of societal impact. So, and here's how this ISO 21,0001 creates shared value. So, for a student, it means a more consistent learner focused experience. It means better curriculum design, stronger support systems, and then for the educators and staff just like us. um because I do teach at a part-time basis but while I'm still connected with the industry, while I'm still connected with a nonprofit organization. So for the educators and the staff of the um of the universities, it means clear expectations. It it means better alignment, reduce chaos and then improve capability building. And then when it comes to the communities, it means that universities align programs to the needs of the communities um to the health um technology, agriculture, public service and for the society. The graduates now become more employable um they become now more ethical and equipped to contribute to the national development. And when you look at the future generations, sustainable educational practices, um long-term quality systems and responsible leadership, um development. So this is the shared value. The value created doesn't stop with the students paying that tuition, right? It extends to families, extends to industries and communities and employers and the country. And this is education as a societal engine not only an academic institution. So another shift that I want to share with you, this is the fourth major shift, the shift in the voices that guide our decision. Because for many years, our organizations, our companies are built um their strategies around one primary voice, the voice of the customer. And there's nothing wrong about that, right? That's um this is perfectly okay. Customer is definitely essential, but that is the world that we live in. Um I even remember a lot of the courses that I took years ago that you know um customer is the center of everything and so forth right but then again now it's not only that right is now only about the voice of the customer um the world today is shaped by the forces far bigger than customer feedback the one I mentioned with you earlier the climate disruption the pollution especally right here in the Philippines, the plastic pollution, the mental health crisis, the scarcity when it comes to water, energy instability and the gener generational expectations for ethical action and so forth. So these are the different forces that we now have. So if organizations listen only to customers, they miss the voices that shape whether a business can survive in the long term. And that's the truth, right? So when we speak of sustainable excellence, we're now talking about not we're not talking about the VOC anymore. We're talking about VOC plus VOP. Meaning when we say VOP, we're talking about the voice of the planet and voice of the society. It's because today's organizations must answer questions like um how does this decision impact the environment? How does this decision or how does this product affect communities or does this process contribute to a sustainable future? What will future generations say about what we are doing today? So this is the evolution from a marketdriven organization to a responsible future ready organization. Because the truth is customers tell you what they want today, but a planet and society tell you what will keep you alive tomorrow. Okay. So let me give you an example. if you're not sold into that idea that I'm sharing with you now that VOP should be part of it. I mean sustainable excellence is really more about VOC plus VOP, right? And one of the simplest but most powerful examples that I can share with you is this the paper straw the the voice of the customer right or customers would say repeatedly would say loudly and repeatedly we don't like paper straws. They got saggy, right? Which is the truth. But if companies listened only to VOC, paper straws would disappear overnight. But the voice of the planet, the voice of the society, the VOP says something different. Take a look at this number that you can see on the screen. 8.3 billion plastic straws pollute the ocean every year. Microlastics now appear in fish, in food, and even human blood. Marine life is choking to death from singleuse plastics. So, organizations faced a decision. Do we prioritize short-term convenience, which is that VOC, right? Or the long-term environmental responsibility, right? And good thing that a lot of the companies they chose the VOP or the voice of the planet. So it's a very good example which can tell you that it's not only about VOC what the customer want right what the customers want um but it's really a combination of the VOC as well as a VOP and sometimes they conflict but leadership means balancing the two and this is not about ignoring the customer experience it is about improving it responsibly so the future generations still have oceans um they still have the forest they still have livable climate, right? So listening to the VOC um keeps you competitive while listening to VOP keeps you alive. Sustainable excellence definitely requires both. So the next shift that I want to share with you is this. So one of the most shifts or one of the most important shifts sustainable excellence is the shift in what we measure. So before we're talking about the CTQ the critical to quality and usually we measure the accuracy the speed the defect cycle time um cost per unit and same thing these are definitely essential these are very important but here's the limitation CTQs measure performance inside the organization it's still inside the enterprise right but CTS measures um impact beyond the organization CTS meaning critical to sustainability Um, it answers questions like, are we minimizing our environmental footprint? Are we elevating communities around us? Are we operating responsibly for future generations? Or are we futurep proofing the business in a changing world? Right? So, CTQs tell you if you're doing things right, but CTS tells you if you're doing the right things. CTQs usually ensures operational excellence but CTS can ensure long-term um survival, long-term relevance in the market and the companies that win today measure both right so you can have a perfect CTQ scores but um but still have or still be an an unstable or unsustainable organization. So that's why CTS must enter the dashboard. So let me show you what CTS look like or CTS looks like um in some of the companies today. And here are some of the most CTS metrics organizations are now starting to adopt. Um and these are like must haves right. These are not only nice to haves but these are the musthaves already of organizations these days. These are becoming um core indicators of performance for a lot of the boards, the the investors, the employees, partners, um customers. Um if you can see in here, these are some of those metrics or CTS metrics like reducing single-use plastic, how much waste are we preventing, um how many disposable materials have we faced out and so forth. Second was transition to renewable energy. So we're also measuring what percentage of operations runs out on solar or on hydro or on wind. Um community impact metrics as well like how many people or communities experience uplift because of our presence. Are we contributing to their education to their livelihood um to the health or to the resilience of the community that we u that we're operating in? And then the last one is a lot of the companies are starting to measure DEI, right? The diversity, equity, inclusion score. Is our workplace equitable? Do all groups feel represented? Do they feel included? Do they feel respected? So that's what DA is all about. So that's the that's a shift. Next one is the evolution of performance indicators. So what organizations choose to measure as proof of success. So before this is the usual things that we measure like defect rates, cost of poor quality, the process efficiency, but um that's good, still good. Um but here's the limitation of those indicators that I mentioned with you is that this measure um these indicators measure what happens inside the organization still inside the enterprise. What we want to happen is we want to measure like up until the environmental perspective. So that's why we now shift to also measuring the carbon intensity waste to landfill um reduction diversity inclusion index community engagement and digital inclusion. So one of the examples of that is the sari store right um even sarasar stores are now embracing sustainable performance indicators like for instance like in San Huan and in other cities some sarasara stores have launched what they call the refilling stations where people can buy dishwashing liquid um detergent and shower gel in in a what do they call it thingy t thingy quantities um using re reusable um containers Um this is a small innovation but um its impact is actually enormous. It's because the traditional KPIs for for as store used to be um your inventory turnover, your sales per um SKU or the stock keeping unit, the margin per item most likely and these are all important but this is incomplete because today the micro entrepreneurs are embracing the new performance measures like for instance the waste reduction or plastic avoided like every refill that they do that means It's one less plastic bottle in the landfill and that directly contributes to the sustainability KPIs like your um waste to landfill reduction. When you look at community engagement as well, customers become partners in sustainability like barangis begin to participate and which means that the awareness actually grows in all of the barangis. Um if a lot of the sarasar stores are doing it then that would be amazing. Next one is about the access and inclusion. Meaning that refilling makes essential goods cheaper, more flexible and more accessible especially to the lowincome families. And then the last one is the carbon footprint reduction. When you look at it, right, the fewer plastic bottles produced that would mean that lower carbon emission in the manufacturing or um manufacturing also in terms of transport. And that's what sustainable excellence at the grassroots level. If that sari stores can shift their indicators, imagine what corporations, universities, hospitals and governments, offices can do, right? So when we evolve, when performance indicators evolve, behavior evolves too. And when behavior evolves, systems change. And this is the essence of moving from business excellence to sustainable excellence. So I I still have a couple of slides that I want to share with you. So you may now ask AI because definitely everyone is talking about AI what is its role in terms of the in terms of sustainability. So um before we talk about AI and sustainability and business excellence, it's really important to make one um one thing clear that AI is not the goal, right? AI is not here to replace our strategy. AI is not here to replace us, to replace leadership um or to replace the frameworks that we have or to replace our values. Instead, AI is a catalyst. It usually amplifies our ability to think long term so we can respond um faster. we can govern smarter and design systems that not only that are not only efficient but really regenerative and human- centric. So AI helps us move from reactive to predictive. So when we talk about using AI, it's not about chasing technology, it's about using intelligence so we can elevate strategy governance and we can design towards a sustainable future. And let's break this down into three areas where AI becomes a powerful accelerator for sustainability. First one, when it comes to strategy, AI strengthens the strategic direction of an organization by giving leaders foresight they never had before. And through predictive analytics for um climate risk, organization can participate disruptions, not react to them. So you have the prescriptive analytics for energies for example where AI can recommend the most efficient choices. They can help companies reduce both the cost and carbon. Um you can also do scenario planning and so forth. So that's from strategy perspective. From governance perspective um AI enables governance that is transparent, realtime and adaptive. So imagine having that unified sustainability dashboard where all your ESG metrics, your energy, your waste or carbon community impact and so forth, they update in real time. With impact visibility as well, leaders can quickly see whether their actions are producing meaningful progress, which is a great thing, right? And with that adaptive governance, organization can adjust policies and controls um as fast as the world changes. And from design perspective as well, AI can empower us to rethink how we design systems, how we design products, how we design experiences for our customers or for the communities, right? From AI powered digital twins that simulate um the entire system, the entire operations before you invest in a single pessle. um to circular design principles that can eliminate waste from the start or to continuously learning um loops where the system becomes smarter every day based on real data and this is where AI truly becomes transformational. It can redefine how we imagine how we create and continuously improve sustainable business models. So AI makes systems more intelligent but humans must make uh humans must make them more humane. I think that's a this a very um important thing that we need to make sure that it remains with uh with people because a can definitely optimize a lot of the processes. It can predict a lot of the risk accelerate a lot of the decisions that we do but only humans can make them humane. Only humans can embed empathy, can embed ethics, fairness and accountability into the way these systems are designed and used. So sustainability requires definitely um it requires more than the algorithms in the world. It requires human judgment. It requires human values and human responsibility. So let me share with you the takeaways before I close my session for today. Actually there are more on the slide that I I input in here including some of the FAQs but we will be sharing with you the material for for today. Um so by the way please join our Viber community in here. Um so this is the first takeaway that quality and sustainability are no longer separate they are one transformational agenda. So in the past quality focused on reliability, consistency and a lot of the customer satisfaction as we mentioned earlier while sustainability sat somewhere else often under CSR usually right and we usually put it right there at the um social responsibility or the corporate social responsibility or we put it right there at the compliance. We put right there at the environmental teams but today these two agendas have merged. Why? It's because the highest form of quality is sustainability, which is the ability of a system or a business or a community to endure and to regenerate. The product is not truly high quality if it harms the planet. In a process is not truly worldclass if it leaves society behind. So as leaders, we don't choose between quality and sustainability. Our task is to integrate them into one unified transformation journey. So takeaway number two, um excellence models must definitely evolve. Um if it doesn't include environmental and societal impact, it's outdated, right? So many of the excellence models we grew up with. Um they were designed for a different era, an era where unefficiency and um competitiveness were the priority. But if the model today does not incorporate environmental impact um if it does not incorporate the societal well-being or the long-term regeneration then it is simply outdated. So the world has changed that's what we mentioned there. The world has changed significantly. Climate risk are now being business risk. Social impact affects brand trust and talent retention. Stakeholders now include communities and even the planet. So excellence definitely must evolve beyond the internal performance that we measure inside the company. It must reflect how our decisions shape the world outside our walls. Because true excellence is not only about being the best. It's about building a better future. So takeaway number three. So when we talk about transformation, it's not it's not only about the the the new tools, the new technology. It's about reframing the foundations of how organizations operate. So three core elements must shift, right? Your stakeholders. They must expand our lens from customers and and owners um owners view to include employees, communities and uh future generations. From value creation perspective, value is no longer onedirectional. It has to be shared where businesses grow while society and the environmental or the environment thrive. And the third one from metrics perspective, what we measure shapes what we value. So we shift from the short-term efficiency to long-term sustainability indicators. So and then takeaway number four, we are entering in an age where uh AI can accelerate everything. Um the things that we do from analysis perspective, the decisions that we're making, operations and even innovation. But the truth is that we have to remember is that AI only amplifies the direction we set. Right? If the purpose is unclear, AI will simply accelerate that confusion. So if the purpose is misaligned, AI will accelerate the wrong outcomes. But when purpose is strong, AI becomes a force multiplier. So the question is not how advanced is your AI. The real question is what purpose is your AI serving? Because technology gives you speed but purpose gives you the direction and leadership gives you that meaning. And the last takeaway that I want to share with you is that the real measure of success is regenerative um capability, not just um efficiency. Um efficiency is still important but it's no longer enough. As I mentioned earlier, the new benchmark is regenerative regenerative um capability which is the ability of the organization to create more value than it consumes to replenish resources not deplete the resources to uplift communities not to exhaust the communities but and also to serve the future future generations not just the current generation. So regeneration is the next frontier of excellence because sustainability is not simply reducing the harm. Sustainability is really enabling the life to flourish. So if your company disappeared tomorrow, this is one of the question I want to leave with you. Um let me ask you this. Um this is a brutally honest question. If your company disappeared tomorrow, who would actually miss you and why? Not your shareholders, not your board, but the people whose lives are touched by your products, your services, your presence. And this question is really reveals your real value. If the answer to this question is unclear and unclear, it's a signal that the organization must revisit its purpose, its impact and the legacy it is building. So one of the question I want to leave with you is this one. So another question I want to leave with you. Which sustainability risk threatens your operations the most at this point? Um it's not just about doing good right it's about protecting your ability to operate. So every company today um it's facing at least one of these risk. So what is that risk? Another question is what wasteful practices or practice does everyone know is wrong but nobody question. So I believe every organization has that like elephant in the room. Um a wasteful practice that everyone sees, everyone complains about quietly but nobody challenges. And that question matters because sustainability begins with courage. The courage to confront inefficiencies and habits that drain resources that drain the the money of the organization or the morale of the organization. What is that practice in your organization? And last question is how would your decisions change if future generations were in the room? So if you imagine in every major meeting right one seat is reserved for someone from the year 20150 a future employee like a future customer a future child who will inherit the consequences of what we're doing today or any of the decisions that we're doing today. If they were sitting beside you would the choices you make still feel right? Sustainability becomes real when we extend the decision- making horizon beyond ourselves. So, and last one, what is one small action you can take tomorrow? Um, because transformation definitely does not begin with the grand strategies. Um, it begins with one small step as we all know, right? One tiny shift that moves you closer to that sustainable excellence. It could be eliminating um one form of waste or redesigning one workflow, improving one policy or influencing one conversation. So what is that one action you commit to? So let me skip the frequently asked questions in here. But let me end my presentation with this. Uh let me leave you with this thought that excellence today is no longer measured by how perfectly we follow a process um or how we efficiently execute like any of the tasks that we do because for me that was the old world sustainable excellence as something deeper from us. So it ask us to do the right things not just the easy things that we can do not just the profitable things but the things that honor people the things that honor or protect the planet that can prepare the next generation. Sustainable excellence from my perspective is really something that challenges us to elevate our purpose so we can rethink our impact so that we can design our decision with tomorrow in mind because the real measure of excellence is not how well we perform today but how responsibly we shape the future and this is the journey we all that we're all part of at this point and that is the leadership of our time requires um and I encourage you to do more um research leave to be part of the sustainability efforts that we're doing. If you have some questions, by the way, you can always reach out with me. Um, these are the social media channels that I have. You can always get in touch with me. And please also sign up to the next webinars that we have for the rest of the week. I never thought I already consumed an hour. Sorry about that. I love I love speaking. Um um so but we already had over time but I can definitely answer all of the questions online. I mean it's offline. So please um register to to this webinars that you can see right here. And I want to share with you the link right here in our chat box. just one moment so that you can take the you can fill out the survey at the same time you can get automatically the um the certificate in your email. So by the way just choose um continue as guest when you click on that link that I'll be sharing with you. Just give me one moment. This is the link for the post evaluation and just one moment. Please put that in here. So I'll give you a couple of seconds for you to access this. Um click on that and then it will route you to specific um site and then choose continuous guest so that you can get your certificates. But we will not allow anymore any of those ones who are emailing us regarding the link because the link will only be shared right here during the session. So thank you so much for joining this session. So did you have any of the questions? Those are the things that we can accommodate right there uh via email. You have questions that we can answer. Uh you can also u get in touch with me directly to my social media channels. You can also email me directly. So let's give it a more time. Let's give it one last minute for everyone to access that link that you can see right here on the screen. Choose continue as guest and then once you're done, check your email. It will be there as quickly as possible. As I mentioned, it's not just an email. It's a it's an email. is not just a certificate but a verified digital certificate. Okay, for the last time, I'll be sharing with you the link where you can access the post survey. And once you're done, please check your email right away. And for those members of PSQ and even non-members of PSQ, I'm inviting you on November 21st on Friday. So we'll celebrate on Friday uh at Richmond Hotel Ortikas. So we'll have the general membership meeting. At the same time, we'll have the year end party for VSQ ah online setup. We'll open definitely the online um setup for on Friday. that will open the zoom on Friday for those ones especially for those on those ones who are far. Okay. So looks like everyone is now good for the last time. Let me share with you the link and then at exactly 3:15 minutes I'll be closing the Zoom. Yay. Thank you so much, Anna, for joining.