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The Honolulu Advertiser
Posted on: Monday, February 13, 2006

Leadership corner

Full Interview with Lito Alcantra

Interviewed by Dan Nakaso
Advertiser Staff Writer

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Age: 68

Title: Owner and president

Organization: Group Builders, Inc.

Born: San Vicente, Ilocos Sur, Philippines

High School: Ilocos Sur High School, 1955

College: Mapua Institute of Technology, B.S. in civil engineering, 1960

Breakthrough job: Acoustical Insulation & Drywall, Inc. in Honolulu.

Little-known fact: Sold house in Royal Summit in 1982 to repay a bank loan to keep Group Builders afloat during hard financial times and moved in with family in Kalihi. "When my wife arrived from the Philippines, I cannot tell her the truth. I first take her to breakfast. You don't want to hear bad news when you're hungry."

Mentor: Charles I. Cook, 92, the former executive director of the state contractors licensing board.

Major challenge: "There's no people, manpower-wise. The labor market is very tough. We have 450 employees but need a minimum of 50 more. And material costs are rising while there is also a materials shortage."

Hobbies: "Working. That's what I do. I don't have any other hobbies. If I am not working, I am not happy."

Books recently read: "Life Extensions." "That's a book about extending my life like Charlie, to 92 years old. You have to watch what you eat, what you do."

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Q. Tell me about your breakthrough job with Acoustical Insulation.

A. I joined them from the lowest bottom as a janitor at age 36, just after I arrived from the Philippines. In 1972, martial law had just been declared in the Philippines (by then-President Ferdinand Marcos). I had my own general contractor business in the Philippines and at the same time I was also the dean of the college of engineering for Northeastern College (in the city of Santiago, Isabela).

Because martial law was declared, there's nothing you can do because of the limits on trade and everything like that. Business people were being kidnapped and you had no freedom. So I came to Hawai'i because my parents are here and my brother and three sisters are here. I left four kids and a wife back in the Philippines.

At Acoustical Insulation, I only told them I had a high school education because I did not want them to say that I was overqualified to be a janitor. Well, after six months our chief estimator was transferred to Guam. During the six months, I was studying the project plans after I sweep the floor and do my duties.

From the bottom, I apply for the chief estimator job and I show my credentials. I said, "Sir, I am overqualified for my current position." They say, "We'll let you bid on a job to see how you do." I bid the first job and I was $2,000 under for a $6 million job and by the grace of God I won the bid.

The next lowest bid was from a big contractor and they offered for me to go work for them and I say, "No. Because they are giving me a chance." I became the chief estimator. Back at work, people would say, "What are you doing looking at those plans? You need to be sweeping the floor." Then they made the announcement that Lito has been promoted to be chief estimator and everybody look at me. "Who are you?" Six months after I was promoted to chief estimator I was promoted to executive vice president. Then I was running the whole operation.

Q. How did you get started with your own business?

A. Acoustical Insulation was sold in 1979 and Hawaiian Dredging offered me a job as a project engineer. Charlie Cook (the former executive director of the state contractors licensing board) called me up and said, "Lito, let's go have breakfast." I don't even know the guy except that he is executive director of the state contractors licensing board. He told me, "I do not want you to work for somebody else. You need to start your own business." I have only $1,000 in my savings. I am sending my kids to college in the Philippines. We parted the restaurant and he gave me an envelope. I open up and there is a $30,000 cashier's check in my name. He said, "You work too hard for somebody else. Lito, go ahead and form your company. This is your money. I have been watching you, Lito, and I do not think you should be working for anybody." Charlie is now the CEO of the company.

Q. Two weeks ago, the Hawai'i Carpenters Union gave you the 2006 Outstanding Union Builder Award, only the second time the union has given out the award. Please explain your attitude toward your union employees.

A. (Except for 28 office workers and project engineers), we are 100 percent union workers. A lot of people are against the unions. But the union does a good job. These union people are trained. They have better quality and better workers.

Q. Ron Taketa, the head of the carpenters union, said in his speech presenting you with the award that you have a cooperative approach toward labor-management relations. What is your approach to dealing with union employees?

A. We respect their allegiance to the union. And we respect them as our employees so they respect us as their employer. I am proactive with them and I tell them the truth. Communication is the key.

Q. You give your non-union employees a maximum 25 percent of their gross salary in profit sharing, plus bonuses that can add up to several thousand dollars more. You also pay non-union employees for sick days that they do not use in a given year. What perks, if any, do you offer union employees who already enjoy what some people consider generous benefits?

A. We give them annual bonuses, based on their performance, that can add up to several thousands of dollars. We send an average of 10 employees to seminars on the Mainland for their further study about three times per year. We pick up their transportation, allowance, everything. If they go to training in Vegas, we also give them gambling money, too. We want to show appreciation for the people.

Q. In a construction industry struggling with a labor shortage, that approach would seem to help you recruit workers. But your approach predates the current worker shortage.

A. Right. But now it's paying off because people want to work for us from other companies. So we can choose.

Q. But since you worked your way up from the bottom in Hawai'i, why do you give union employees above and beyond what you're required to provide?

A. I put (myself) in their shoes so I know how people feel. You cannot tell somebody to do more when they are hungry. You have to feed them. The relationship is No. 1. They may be in the union but their loyalty goes to us. And they are very loyal.

Reach Dan Nakaso at dnakaso@honoluluadvertiser.com.