The Edge, December 1, 2008
By Emily Tan
For Tan Sri Francis Yeoh Sock Ping, the strength and value of the YTL brand lies in its ability to deliver on its promises. It may sound basic, but YTL’s emphasis on quality and consistency has won it numerous awards, and built a brand so strong it now has 12 million customers on three continents.
"YTL has been around since 1955. It stands for integrity, and our customer's faith that we have the ability to deliver. From a humble beginning - we have grown on a reputation for being able to build things on budget and on time,” said Yeoh in a recent phone interview.
For the financial year ended-June 30, 2008, YTL Corp Bhd announced a net profit of RM848 million. This represented an increase of RM231 million or 11 % compared with the previous year's result. In an Aug 19 statement announcing the results, Yeoh credited the group's overseas operations for contributing the bulk of the earnings.
Where Yeoh is concerned, it is the brands that have helped take YTL international that hold pride of place in his heart.
“I am most proud of these three brands: Pangkor Laut Resort, Starhill Gallery and Wessex Water,” he says. “Pangkor Laut, for example, has won a slew of awards including the title of “number one resort in the world” from Conde Nast Traveller, UK (2003). Now we have just reached arrangement to open one in Dubai, and the brand is so awesome that the name (Pangkor Laut) is to be retained and not renamed for Dubai.
Starhill Gallery, an upmarket shopping mall located in Kuala Lumpur’s Golden Triangle, was rebranded in 2005 by Interbrand as a premier mall. Since then, Starhill has led Forbes Traveller’s 2007 list of “Asia’s Amazing Malls”. Last year YTL signed an agreement with ETA Star Property Developers LLC of the United Arab Emirates to launch the concept in Dubai.
Dubai's Starhill Gallery, set to be completed in the second quarter of 2010, will be part of the US$410 million (RM 1.4 billion) Starhill Towers & Gallery complex being developed by ETA Star. It will occupy 250,000sq feet and is the first development outside Malaysia to carry the Starhill brand.
"When you consider that Dubai itself is one giant mall, it is impressive that they are willing to invest in differentiating Starhill Gallery,” says Yeoh, who is also interested in launching the Starhill brand in Singapore and London.
Wessex Water, a utility that supplies water and sewerage to parts of south-west England, represents a shining achievement for YTL. YTL Power bought it over for £1.24 billion (RM7.89 billion) from a bankrupt Enron in 2002. Since then, Wessex Water has gone from strength to strength.
"Since our ownership, Wessex Water has ranked first in operating efficiency by industry regulator Ofwat for three years running (2004-2007), and has recently been awarded a Queens Award for Enterprise in the sustainable development category,” says Yeoh.
Sustainable development is something that YTL Corp is championing. This takes two forms, the first of which is its commitment to running environmentally sound operations across the YTL group – from its water and power generation activities, to hotel development and management and homes, such as its decision to maintain a 35-acre green lung in the heart of Kuala Lumpur for its Sentul project.
The second is YTL's advocacy efforts in environmental protection. In March last year, it sponsored Climate Change Week, a week-long initiative to raise environmental consciousness among Malaysians and get them involved in the fight against global warming. "Climate change has emerged as a challenge faced by every citizen in the world; we are currently at a crossroads, and if we don't face it now, it will be at a dire cost to ourselves, to the environment and to the health of future generations,” said Yeoh at the launch. This year, YTL also sponsored Climate Change Week.
Its efforts have not gone unrecognised. YTL won the "Best Social Reporting in an Annual Report" in the ACCA Malaysia Environmental and Social Reporting Awards (Mesra) in 2006, and a commendation for Social Reporting at the 2007 ACCA Mesra awards.
For the future, Yeoh plans to take yet another company under the group international. He has plans to reposition YTL Land & Development Bhd as a global business.
"It has many sought-after properties such as Sentosa, and on Orchard Road [both in Singapore]. The launch of the company as a new global property developer will take place sometime at the end of this year. More on that, I can't say, ask me next year!" says Yeoh.
Part of YTL’s branding success lies in Yeoh's understanding of the marketing mix, and his efforts to ensure that the brand stands for something substantial.
"Each company is authorized to spend up to the industry standard of 2% to 3% of the turnover on advertising. What they choose to spend on depends on the company. For example, with Starhill and the hotels, advertising is all about telling people why they should shop or stay there. But with YTL Corp, advertising is all about maintaining our image. It's a different matrix, designed to convey a the company's DNA.”
Yeoh also believes that a brand is successful only if the company behind it masters the ‘three languages’.
“There’s the language of God: Integrity, honesty, morality. The language of man: Be articulate, be a leader, a manager with vision. And the language of machines: Be fully equipped with computer and tech skills,” he explains.
These values are expressed internally as well as externally in YTL Corp. According to Yeoh, the group has one of the lowest turnover rates in the industry; the Ritz Carlton Hotel in Kuala Lumpur, which is owned by the group, was a Hewitt Best Employer in Malaysia award winner in 2003 and 2005.
"We believe in internalizing the company culture by offering staff options in the YTL parent company as well as generous rewards and performance-based bonuses across the group. It helps employees feel passionate about the company's performance and reputation,” says Yeoh.
But ultimately, for Yeoh, his investment in the brand must show returns in terms of profits and revenue. "Return on investment is best answered through sales, and being able to reward our shareholders with generous dividends,” he says.