Strategies driving developers forward
Every company has a vision, but it is the corporate strategy that will help it achieve its goal
By Joseph Wong email@example.com
We hear it all the time when companies talk of future plans and how vital it is to get corporate strategies right in order to succeed. Because corporate strategies encompass actions to achieve the company objectives, its endgame is to gain a competitive advantage for healthier financial performance.
But what does corporate strategy mean? Empirical texts describe it as a clearly defined, long-term plan that organisations set, in seeking business success. For listed corporations, it is a continuous process that requires a constant effort to engage investors in trusting the company, thereby increasing the company’s equity.
But like non-listed companies, it is also about reaching goals and targets set as with most developments, especially the townships, it is a long-haul strategy spanning as much as 30 years down the track. Statistics also show that organisations that manage to deliver customer value unfailingly are those that revisit their corporate strategy regularly to improve areas that may not deliver the aimed results.
Little wonder why many developers, in attempting to elevate their reputations, tend to re-strategise after a few years, either to reinvent themselves or to make a paradigm change. UEM Sunrise Bhd recently did just that. It unveiled its new strategy to drive growth and sales for the year 2020, focusing on delivering quality and exciting products to their customers. This was also to continue enhancing UEM Sunrise’s brand value with the recent launch of an immersive rebranding exercise to unveil UEMS 2.0.
As UEM Sunrise embarks on its ten-year business cycle and in conjunction with the 50th anniversary since its founding, the company resets the organisation for the next growth story, said its managing director and CEO Anwar Syahrin Abdul Ajib. The tagline “Find Your Happy” is now an important part of the UEM Sunrise brand moving forward, he said.
The rebranding exercise represents the company’s efforts to design, create and curate spaces for their customers, partners and stakeholders so that they can prosper, grow and find happiness, he said. The company had previously launched its new, colourful and vibrant UEM Sunrise brand values comprising caring, honest, involved, enthusiastic and fun-loving (CHIEF) and all 1,100 staff members were appointed as “Chief Happiness Officers.”
“UEM Sunrise’s brand story is at heart, one of belief, optimism and resilience. As the pioneer developer of Mont’Kiara and Iskandar Puteri, we have shown the importance of a strong vision and strength in execution to create what stands today as transformative developments emulated and copied by many, a perfect example of how we create value through strong vision and mission,” said Anwar.
“Through trials and errors, and years of experience, we have learned that one of the keys to success in the property sector is to be close to your customers.
“We cannot think that we know what is best for our customers all the time. Owning a house involves a lot of money and most of the time, it involves a person’s life savings. We must be sensitive of this fact and ensure there is capital appreciation in the products we sell by keeping ahead of trends and generational shifts.
“When this happens, then there will be brand loyalty and more opportunities will come our way. Furthermore, with an increasing middle-class base in the country, the level of sophistication has grown too, and Malaysians are now more educated and well-travelled both physically and virtually through technology,” added Anwar.
UEM Sunrise’s rebranding efforts are fueled by their desire to do and be even better than before, particularly after their internal restructuring efforts under the new operating model. As a result, the new UEM Sunrise is leaner, flatter, more agile and has changed the way they do work.
In meeting UEM Sunrise customers’ high expectations, the company plans to evolve from being a pure property developer to a full-fledged real estate player – from building houses to a company that operates in multi-asset classes, explore options to grow the business either by expanding geographically, acquire high yield assets or pursue vertical integration, explained Anwar.
“We will work with other strong brands to tap on their competencies and networks, which can help elevate the UEM Sunrise brand; and increase their sustainability efforts which are evident in most of their latest projects,” he said.
Maintaining top position
For SP Setia Bhd, the company is bent on maintaining its position as the top property developer in Malaysia in terms of sales. Over to the new decade starting FY2020, the group will continue to concentrate on launching landed residential products which are in line with the demand of the owner-occupiers, said SP Setia president and CEO Datuk Khor Chap Jen.
The focus will remain on established township developments of Setia Alam, Setia Ecohill 1 & 2, Setia Alamsari, Bandar Kinrara and Alam Impian in the Central region, Setia Tropika, Taman Pelangi, Taman Pelangi Indah and Taman Rinting in the Southern region and Setia Fontaines in the Northern region. In addition, the developer will also launch commercial products such as shop lots with a combined gross development value (GDV) of approximately RM871mil in Alam Impian, Kota Bayuemas, Temasya Glenmarie, Setia Eco Glades and Taman Pelangi.
These commercial products are essential to support and scale up the existing development mix and to ensure the sustainability of these housing areas, said Khor. “Leveraging on the versatility of product offerings of the group, SP Setia is confident of retaining its position as the leading developer in Malaysia while maintaining the sales target of RM4.55 billion for FY2020.
“Nevertheless, with the global outbreak of Covid-19 virus ongoing and its impact on the economic outlook remains uncertain, the group will monitor closely on how the situation unfolds,” he said.
An opportunity for change
Mah Sing Group Bhd’s shift to realign its strategy was during their 25th anniversary last year when it unveiled its new corporate logo and tagline: “Reinvent Spaces. Enhance Life”. The new logo is the company’s third since its inception. It symbolises Mah Sing’s identity — a company that strives for excellence in product delivery, quality, customer service and customer care, according to founder and group managing director Tan Sri Leong Hoy Kum.
In order to achieve its new vision, the group focus on empowering its staff towards personal and professional growth, a move that proved to be a good one judging from their positive 2019 financial results. Like UEM Sunrise, the company introduced its ‘POWER’ statement in 2017, which stands for performance first, ownership, well-being, empowerment and resourcefulness — a continuous learning programme to train staff and uphold the company’s values.
Going forward, Leong is enthusiastic that 2020 is going to be another exciting year for the group. “In view of the rising appetite for mass-market housing, we are confident to achieve our minimum RM1.6 billion target sales this year. We intend to leverage on our healthy cash and bank balances of approximately RM1 billion as at 31 December 2019 to source for new, strategically located landbanks that fits our business model, whist exploring any joint venture opportunities,” he said.
To keep investors happy and ensuring their equity strength, Mah Sing has been consistent in paying dividend rates of at least 40% of net profit over the last 14 years. By upholding its commitment to reward shareholders, the group is able to maintain a prudent and disciplined approach for long-term sustainable growth.
For mid-size players like JL99 Group (JL99), its chairman Datuk Seri Jeff Lee has a different approach to his corporate strategy. As with many companies which have ventured into the property sector, he built up the company from the ground up. Getting the grass-root level’s support was a big part of his building of the company’s reputation.
The developer took a couple of projects that many would have avoided because his stance was to strengthen the goodwill of JL99. Lee recalled one redevelopment project where many of the residents involved had already been disappointed by other people’s promises, but he made an effort to deliver better and bigger homes for this community.
“Sometimes, it is not about just making money but giving back to society,” he said. He also ‘adopted’ a 23-acre lake which was turned into 99 Wonderland Park – a mini zoo, housing many animals loaned by the Department of Wildlife and National Parks Peninsular Malaysia. The park, which currently houses thousands of animals including crocodiles, tapirs, sun bears, raccoons and deer, as well as being able to enjoy fireworks every alternate Saturday.
“We have spent about RM48 million to date, improving on the facilities and introducing animal species for visitors of the park,” said Lee. While there is an entry fee for visitors, much of the expenditure to keep the park operating is funded by JL99. It is through such altruistic actions undertaken by Lee that has given the company a strong reputation and much goodwill. “If you do good deeds, you will receive good things in return,” he told StarProperty of his Karmic belief.
Not surprisingly, it shows as the people in KL North know Lee and his company, and through that goodwill, he has seen strong sales performance of his property launches.
Different strokes for different folks
What can be observed with most companies striving for better results is their acknowledgement for change. This is where getting their corporate strategy right is essential. Each property developer will have their own corporate strategy as one company’s winning strategy might not fit another company’s direction. At the end of the day, it is up to the property developer to find what suits it best.