Optimum profits, prudence, dynamism and prevention are key words that the president of the Thailife Group of Companies, Chai Chaiyawan, has used to drive his family's business, which these days has assets valued at Bt117.6 billion.

The Chaiyawan family is one of the country's low-profile business groups, despite a long history of managing a sizeable cluster of companies covering banking and insurance, alcohol and beverage manufacturing and hospitality services.

Of the group's assets, banking and insurance business accounts for Bt110 billion, alcohol and beverages for Bt5.6 billion and hospitality services for Bt2 billion.

To ensure the businesses are running smoothly, Chai is willing to work 15 hours a day and eat his lunch in the car on the way to his next meeting.

He says the Thailife Group is not really a family business, but a private company run by professionals who make all business decisions jointly with the family.

"We [the Chaiyawan family] are only the major shareholders, which makes it different from a family business," he says.

Chai is president and director of the Thailife Group of Companies, which includes Thai Life Insurance, Paiboon Insurance, Rim Pae Development, Thai Asia Pacific Brewery (brew for Heineken beer brand), Park Nai Lert Hotel and Thai Malaya Glass.

The family also manages the Thai Credit Retail Bank, which opened earlier this year.

Despite the Chaiyawan family retaining top management positions, the group employs professionals and experts to manage the companies. All managements are independent to ensure good operational performance. Although Chai shares his ideas during board meetings, his role is one of approval of business direction rather than intervention.

Chai realised when he was still a student that responsibility for developing the family heritage rested on his shoulders, so he chose to study business administration for his master's degree.

The Chaiyawan family's business originated in distilling alcoholic liquor. It made its own brands of liquor until it became part of a group called "Five Tigers," including other well-known liquor tycoons Charoen Sirivadhanabhakdi, Udane Tejapaibul, Paisarn Cheewasiri, and Viraj Tantivivattanaphand. They made the now-famous liquor, Mekong.

Then, the government restructured the Kingdom's liquor concessions, and the family moved into insurance, namely Thai Life Insurance, Paiboon Insurance and Thai Health Insurance.

Over the past 25 years, Chai has been a key figure in leading the group's expansion and entry into diversified businesses such as property development and manufacturing. The group now makes Heineken beer, jointly manages Novotel Rayong with the Accor Group, and makes glass in its latest joint venture with a Malaysian investor.

"I have enlarged the business not only to make it a proper business but also into related fields so that it has become a business conglomerate," he says. "I don't want to have day-to-day management, but now is not the right time for me to give it up. All the professionals and experts in the group's core management are drawing up business policies to ensure that we are capable of becoming a public company overnight."

However, Chai stresses that although the group has high potential to become a public company, it has no present need to make that change because it has no need for low-cost capital.

Rather, he looks forward for business opportunities leading each of the companies "in the proper direction". For instance, Thai Life Insurance should be the leading company in customers' minds because of their trust in its service. This will achieve customer loyalty.

Paiboon Insurance, the group's general insurance arm, will concentrate on niche markets to guarantee its survival in an environment of tougher competition. "It is not our flagship business, but we are still concerned about trade and opportunities," he says.

Thai Health Insurance has high business opportunities because its products are designed to capitalise upon market trends and customers with high purchasing power. Rising health consciousness has prompted people to seek more medical care services, Chai says. However, management of the business is still problematic because it operates through third parties.

The group's entry into glass manufacturing was intended to support its beer-making business, while rising demand for property and a buoyant tourism industry have attracted the group into property and hotel development.

Chai has set a challenging goal for the group's companies, saying that each business should grow at least as fast as the growth of its industry.

"I've steered the business through a variety of turning points, including good economy, bad economy, worst-case business environment and economic slowdown, and we've survived by standing on our management principles," he says, restating his key words of optimum profit, prudence, dynamism and prevention.

As a graduate from the West, Chai accepts knowledge and technology from developed countries to benefit his companies. However, he also believes in the human development philosophies of the East, which he applies to his management of human resources development.

"I prefer a mixed management style, including top-down and bottom-up as well as an East-meets-West culture to smooth operations," he says.

Chai points out that Thai Life Insurance has developed many systems and services which have lately become standard strategies for other insurance companies. These include care centres, tele-sales, brand building and allowing international rating companies such as Standard & Poors to rate the company's credit.

On the issue of prevention, the group will focus on investment in rising-star businesses so as to offset those that are declining.

Achara Pongvutitham

The Nation