The Aboitiz Group proves that being more than a hundred years old doesn’t mean a conglomerate can’t reinvent like a start-up. The Group recently unveiled the “Aboitiz Great Transformation,” its newest strategy to jumpstart hypergrowth initiatives and transform its subsidiaries by exploring new businesses and revenue streams, and transforming its services to stakeholders through increased digitalization and innovation.
Several initiatives established in 2021 have proven to be strong foundations for speeding up the Innovation journey across the Group. With these starting points firmly in place, Aboitiz is poised to leap forward in its respective industries, revolutionizing the way it moves within Philippine and ASEAN communities and business landscapes.
In April 2021, the Group launched its newest subsidiary, Aboitiz Data Innovation (ADI), tasked with injecting fresh data science and artificial intelligence (DSAI) models and processes across all Aboitiz businesses. Since its inception, ADI was able to operationalize AI-powered models and data science solutions in close collaboration with a number of Aboitiz business units. Aside from this, the Innovation Working Group was able to develop the Innovation Maturity Framework—an internal model to analyze, improve and accelerate the Aboitiz innovation agenda.
David R. Hardoon, Managing Director of Aboitiz Data Innovation, highlighted the crucial role innovation plays in transforming an organization. “Innovation is rooted in imagination—the ability to see beyond what is, or not, right in front of us. Having an innovative mindset is crucial in creating new opportunities and exploring game-changing solutions to advance business and communities,” he said.
With that in mind, Aboitiz business units took 2021 as the year to dive headfirst into experimenting, revolutionizing, and innovating their own processes, products, and assets. The momentum from last year’s innovation projects has also propelled them to continue on in 2022 and beyond.
For AboitizPower, its Distribution Utilities recently migrated their enterprise and legacy systems from on-premise servers to Amazon Web Services (AWS), the cloud computing platform of tech company Amazon Inc. This innovation provided the company with increased system reliability and scalability, reduced operating costs, and better customer service. Meanwhile, for power generation, AboitizPower has instituted the Asset Performance Management (APM) Predictive Analytics System in its Therma South facility, which ensures plant availability and reliability. It uses advanced pattern recognition (APR) analytics layered with machine learning and artificial intelligence to process data from the machine sensors of critical assets and diagnose early warning signs of equipment failure. On the customer-facing side, AboitizPower continues to work closely with ADI to develop smart tools to help them deepen their understanding of their customers’ energy consumption and other energy-related information. This will allow AboitizPower’s commercial operations team to design more tailor-fit energy products and solutions that are most suitable to their customers’ needs and goals.
The Group’s banking arm, Union Bank of the Philippines (UnionBank), continues to dominate the Philippine digital banking space through its various innovative products, customer solutions, and new subsidiaries. UnionBank has redesigned over 150 branches into “Arks” which are equipped with digital transaction portals and self-service machines that allow their customers a more efficient and contactless digital experience. Moreover, UnionDigital, the recently-launched digital banking entity of UnionBank, was one of only six banks granted a digital bank license by the Bangko Sentral ng Pilipinas (BSP). UnionDigital is fully committed to aligning with the BSP’s roadmap on digital transformation in financial services. It has recently partnered with a global play-to-earn guild to make financial products and services more accessible to the play-to-earn and Web3 communities in the country. Meanwhile, UnionBank continues its digital trailblazing with its initial foray into non-fungible tokens (NFTs) to help artists, buyers, and collectors of digital art gain a better understanding of how NFTs can take part in the art economy. For micro, small, and medium enterprises (MSMEs), the Bank has enabled countless MSMEs to digitize their business–from the way they collect payments, to how they meet their business banking needs. The move into the digital space and to capitalize on the recent e-commerce boom as a result of the pandemic has been easier via UnionBank’s MSME Business Banking App.
Pilmico and Gold Coin Group, Aboitiz’s food business unit, started its innovation program in its Philippine sites much early on and in 2021, took the opportunity to expand it across their ASEAN locations (China, Malaysia, Brunei, Indonesia, Sri Lanka, Thailand, and Vietnam). The sharing of nutrition expertise across its inter-regional companies led to the use of alternative raw materials which helped manage cost and maintain excellent production performance and quality of products. For example, Philippine sites have explored the use of barley as an alternative raw material for its productions, while Pilmico’s Indonesian sites used new locally-available by-products as alternative energy sources in their processing facilities. Through these innovative feed milling processes, the level of inclusion rate (the level at which alternative raw materials are used) is maximized. It gives significant cost savings for feed production while retaining the feeds’ excellent quality. This year, Pilmico is setting its sights on accelerating its product innovation processes by further optimizing and streamlining the processing of its raw materials, and conducting intensive nutrition research to deliver more value-added products.
Lima Water Corporation (LWC), one of the water businesses of the Group’s infrastructure arm Aboitiz InfraCapital, began developing its Smart Water Network in 2020, through the launch of its pilot automation program. Through this program, LWC’s water facilities are able to communicate with each other and automatically adjust its operating setup depending on the requirements. Last year, LWC embarked on the second phase of the Smart Water Network Project, which involves the integration of water network monitoring, including real-time leakage detection and water consumption monitoring. Once fully integrated, the Smart Water Network is projected to lead to even better operational efficiency and savings in terms of deep well operation, auto adjustment of transfer pumps and non-revenue water (NRW) management, aligned with its sustainability objectives.
Meanwhile AboitizLand, the real estate arm of the Aboitiz Group, shows no sign of slowing down its trailblazing initiatives. AboitizLand continues to expand its efficient end-to-end online servicing through the AboitizLand Vecino App. The App has been updated this year to enable online home loan applications and digitized documentation, making property purchasing contactless, paperless, and effortless. This year will also see AboitizLand grow its innovation efforts in design and construction management and customer service. A new system dubbed “Project NOAH” offers efficient digital solutions for procurement, inventory management, and construction. AboitizLand has also ventured into strategic partnerships in the use of precast panel technology that will increase efficiency in construction speed, as well as improve the homes’ durability and thermal insulation, making them more resistant to fire, earthquakes, molds and deterioration.
Aboitiz will continue to champion innovation of all types across the Group as it journeys forward with initiatives and programs developed in collaboration with Aboitiz Data Innovation. The goal is to continue creating opportunities for both business and talent growth, and extending to its stakeholders the benefits brought by true, constant, and impactful innovation.
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