Four local CEOs say change is permanent embrace it
By: Bryna Stankiewicz
7/17/2009
Executives who run four of the state’s biggest enterprises Thursday told the annual meeting of the Chamber of Commerce of Hawaii the economic downturn will end, not with a return to the way things were, but with forward movement to a new economic climate some of whose conditions can be seen already.
At the annual meeting of the Chamber of Commerce of Hawaii at Hilton Hawaiian Village, executives from retail, banking, health care and transportion spoke of permanent new conditions likely to last beyond the end of the recession and perhaps beyond the subsequent recovery.
“What consumers are looking for today is value,” Hawaiian Airlines CEO Mark Dunkerley said, sounding a theme each executive touched on. “If someone else undercuts our price, we have to match it.”
With its margins cut to the bone, Hawaiian itself has focused on value, looking for even the most incremental savings, while maintaining certain customer services that other airlines have scrapped but which Hawaiian considers essential to keeping loyal customers.
“Consumers who can’t afford new dresses are instead buying new cosmetics,” said Deena Nichols, Macy’s senior vice president for Hawaii and Guam. “The same thing happened during the Great Depression.”
Macy’s reinvented its management, merging four divisions into one and cutting more than 9,000 jobs. Nichols used to report to San Francisco but now works with people in New York.
Macy’s has also embraced greater variation in product offerings from store to store. The downtown store caters to business needs; the Kailua store offers casual products.
For Art Ushijima, president of Queen’s Medical Center and CEO of its parent system, value means moving more health care work into prevention and doctor visits, away from hospitals.
“By the time a problem has to be dealt with at a hospital,” Ushijima explained, “the cost will be much greater. There is no more costly place to deal with a medical issue.”
Change in health care, he said, includes a magnification of current funding problems caused by the aging of America’s babyboomers, who are just getting old enough to have major health issues in large numbers. Medicare already costs half a trillion dollars a year, or 5% of U.S. GDP.
For Al Landon, CEO of Bank of Hawaii, part of value is stability, and he sees banks edging back toward more conservative behavior that most Hawaii banks never abandoned.
“Hawaii may be the only place in the Union with more healthy banks than unhealthy ones instead of the other way around,” Landon said.
Bankoh recently came in first in the nation by one measure of return on equity, and made a nationwide top 10 list of the most stable banks. Landon got an ovation when he mentioned that his bank did not take bailout loans.
Dunkerley’s applause line was this: “Hawaii is doing considerably better than most other states.”
“Don’t be a deer in the headlights,” Nichols said. “We need to become comfortable with being uncomfortable.”
Howard Dicus Sunrise on KGMB9
Additional Articles:
|
