The Buzz from Brazil, As I See It

Having recently taken a new job that gives me responsibility for marketing high tech solutions for network security throughout Latin America, I have the chance to travel from time to time in the region. As of this writing, I am in Sao Paulo, Brazil, where I have been working for four days, interacting with multiple professionals associated with my employer's product line.

What does the world look like from Brazil, on the eve of Carnaval (which starts on Friday, February 20th and runs through Tuesday, February 24th)? Well, in the big city part of Brazil, represented by Sao Paulo, it looks reasonably good. The newspapers and TV news all report dutifully and with significant interest on the news pouring from the USA about economic crises, and multi-billion dollar solutions for the auto industry, the home mortgage meltdown and various other challenges. Brazil, meanwhile, toils away with its own share of challenges, and the government continues to commit significant purchasing power to helping its citizens deal with fallout from up north. Globalization being what it is, however, there is no escape from the forces of demand and credit drying up, all the same, as one of Brazil's premiere companies, Embraer, announced today it's laying off 20% of its workforce, due to a drop in worldwide demand for its airplane product offerings.

Additionally, the buzz in Brazil seems to be about the 30-60 day wait to buy (and receive shipment of) a new car. Even those wanting to buy a used car have a period of time to wait, due to demand outstripping supply. Restaurants appear busy, but mostly during the lunch hour, not so much at night. People seem to be complaining that money is tight, yet you can't find a ticket for entry into the Sambodromo (where Sao Paulo's Carnaval celebration is held) for less than $800 (USD).

Folks that are aligned with high-tech product offerings appear to be forging ahead with growth plans across the board. Their main concern is the fluctuation in the US$/R$ exchange rate, which causes their customers and themselves concerns about exactly how much they'll be paying to their US suppliers when the bill comes due. Nonetheless, as off-shore HQ offices tell them to gird themselves for "economically challenging" times, they respond by gearing up for more usage of technology, such as video conferencing, on-line chat and presentation services, and the security solutions that are needed to make sure business (on-line) is not interrupted by connection failures, security breaches or other QoS (Quality of Service) problems. This is a good market for my employer's offerings, and I'm happy to be engaged in serving the clients and partners that we have in Brazil.

In brief, the buzz from Brazil (at least from a "macro"cosm of the economy, like Sao Paulo) is positive, but not 100% so. It remains to be seen how deep the macro economic problems of the world at large will affect this land of extreme potential and tremendous human and natural resource potential. Stay tuned, and thanks for reading. As they say in Portuguese, "Até mais!"

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2009

Traditions Die Hard

Many years ago, when first traveling in South America, I visited Lima, Peru. It was a fascinating place, due to the historical juxtaposition of Spanish colonial history, indigenous traditions (and people), and of course the ever-present yet incongruous influence of "western" culture (Coca Cola, etc.).

By a serendipitous turn of events, my companions and I found ourselves touring the most famous bull fighting plaza in the country, the Plaza de Acho. As luck would have it, the place was empty, since our visit was many months in advance of the temporada, the season when Spanish and Latin American matadores perform in this centuries-old tradition of tauromaquia.

Our guide allowed us to descend from the seating area of this circular arena, down to the ring itself, where we stood on the sand that serves both bull and bull fighter in this historic and artistic ritual of bravery and sacrifice. With the Peruvian sun shining brightly upon us, we imagined how it must be to see the gate (la puerta del toril) open, and the fresh fighting animal --- raised exclusively for this moment --- come dashing into the ring, seeking to dominate and defend against anything or anyone that might challenge his supremacy.

Having seen bull fights in many famous cities of Spain and Latin America, I must tell you that the art of the fiesta brava is something that has to be learned about. There is a culture and history of this passionate art form, and it is something that escapes many who see only a spectacle of blood and sand. By reading and observing all the elements of this ritual, one becomes more respectful of the bravery and skill that it takes for a single man to face a thundering beast weighing more than half a ton, alone with just a cape in the middle of a ring. To do it successfully, while also showing mastery of the cape, the banderillas and finally the sword and muleta, in all the various moves and classical passes that dominate the fighting animal, is to show what it means to be a matador.

In today's politically correct world, even traditions that are hundreds of years old, and have shown through the ages that they express something ethereal and artistic, are under siege. Even in a city and culture as traditional as Lima, Peru's there are those who would protest and put a stop to this tradition. Let's hope that the world in all of its unique traditions does not become one homogenized culture that eliminates every single tradition, just for the sake of political correctness. Let's hope that traditions as skillful and laden with meaning as those represented in the fiesta brava will not be vanquished by those who hope to make everyone follow their particular view of the world.

To learn more about the tradition of bull fighting, consider seeking books such as:

La Fiesta Brava, the Art of the Bull Ring, by Barnaby Conrad, Houghton Mifflin Co., Boston.

Bull Fever, by Kenneth Tynan , Harper and Brothers, NY, NY.

The Bullfight, A Photographic Narrative with Text by Norman Mailer, A CBS Legacy Collection Book, distributed by the MacMillan Co.

Thanks for reading.

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2008

Seasonality in the Southern Hemisphere

"A funny thing happened on the way to the (U.S.) company's year-end (December) celebrations and quota performance recently when dealing with South America....no one bought any of its product!"

Thus started a sad and fruitless chapter in one particular company's history in Latin America, despite its well-known mantra of Kaizen (constant improvement) and other customer-centric philosophies. You see, for those who have only a limited knowledge of South America, the seasons are reversed, and the selling motion and customer interaction are at times challenging for "northern" firms that think everything in the world operates on "U.S. standards".

Therefore, pay attention to these kinds of realities, when doing your work in the southern hemisphere, particularly in Latin America:

• Budgets for capital expenditures (big ticket software, computers, machinery, etc.) are often set early in the calendar year, and are fully-allocated to vendor "A" or "B" by mid-year.
  
  
• Companies that operate a year in advance for such budgeted items will often be planning their "next year" budget one (1) full year ahead.
  
  
• Expenditures for these kinds of acquisitions will often be completed by December/year-end, however, if you and your firm have not been actively engaged in the "purchase cycle" well in advance of the previous year's budget season, you'll have another year to wait to be considered at all.
  
  
• Additionally, if you and your firm have not earned the right to provide product or services, then for all your excellent marketing and capabilities, folks in South America (and Latin America, generally) will simply not give you the credibility to consider your value proposition.

To be sure there will be happy exceptions to these generalities, but based on this writer's many years of experience in the region, it's critical to take into account the seasonality that affects the southern hemisphere. What's cold and wintry to you in the north, is hot and summery in the south. Buy cycles, decision time-frames and associated operational imperatives are significantly different in the southern hemisphere (e.g., South America), than they are in Europe or North America. Sound simple? It can be, but you have to know, you have to plan and you have to execute appropriately to make it happen.

How does your firm handle this kind of challenge? What are you doing to get ahead of the curve and work your calendar effectively in light of fast-approaching summertime dates in South America?

Thanks for reading, commenting and passing along these tips from LatinAmericanKnowledge.

For other blog topics from this same author, take a look here.

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2008

Lula's Meltdown or Bush's?

Per today's Miami Herald, there is plenty to worry about in Brazil as a result of the current "meltdown" affecting world economies, jobs and industries of all sizes and types. Check this out, based on one particular news source that keeps a close tabs on what happens in Latin America.

http://www.miamiherald.com/business/story/772086.html

Despite what Mr. Lula (Brazil's president) stated earlier about his lack of concern for the economy challenges in the USA and Europe, evidently the Brazilian consumer is showing distinctly different behavior when it comes to spending. This, in turn, like in the USA and other markets, reduces demand, curtails retail sales & purchases, which in turn leads to less jobs, less growth and other deflationary trends.

Again, to quote a number of Brazilians, they are "accustomed to these crises" so this is just one more in a string of such events. Nonetheless, the ebullience of the economy in Brazil for the past 3+ years is such that a great many more citizens in that country are now thoroughly vested in a continuation of sound economic policies, robust job markets, and moderately easy access to credit.

What happens to any economy where the "retail" consumer is responsible for a large percentage of the overall GDP, such as in the USA? How do companies and entire economies cope when that demand is reduced substantially or in some cases, eliminated, due to other economic adjustments? No company and no industry, it appears, is immune to the deflationary aspects of this downturn in demand (for more on this look at: http://online.wsj.com/article/SB122688301012632105.html )

>© Daniel A. Cabrera, TopExec.org, All rights reserved, 2008

Amazing Digital Capabilities in Brazil

Call me a technophile or just someone interested in free markets, but either way, the following anecdote shows some of the innovations going on in our world today. In a recent phone conversation with a dealer/reseller of Wi-Fi Broadband products in Brazil, he described one of his solutions:

For the second largest container/shipping company in the world it is imperative to have maximum efficiency in the handling (loading and unloading) of containers that carry the world's commerce inside gigantic, seagoing ships. To do this the old-fashioned way, the company has to have on-board staff (humans) that tell the crane operator where a particular container is, how it's stacked, and in what order (two levels down, etc.). Using two-way radios this can be done, albeit with some delays as the human staffer has to make his way through the ship to identify and locate a particular container (with its unique ID number).

By using Wi-Fi technology that is linked to each container, the crane operators can easily identify the container, know whether it's vertically or horizontally positioned and find out other important details for loading or unloading. With the cost of labor reduced and the rate of efficiency increased, these shipping operations can move at maximum rates, minimizing the time and cost of having these behemoths of the seas in port any longer than necessary.

This, like many other examples from Brazil (voting on-line, paying taxes on-line, etc.), shows a country that is in the vanguard of technology usage to sustain its amazing rates of growth, its incredible (positive) balance of trade and other leading indicators throughout their economy. What do you think? Do you have an anecdote from domestic or international shores about amazing digital capabilities?

Thanks for reading, and pass it along!

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2008

Making the Case for Credibility - A Latin American Exec Confirms My Comments

As posted in commentary on October 31st of this year, the key to establishing successful business in Latin America is through the hard work and profitable pleasantries of personal relationships.

Recently, I met at length with the G.M. for Latin America of a company specializing in high-tech solutions for security within the Information Technology (IT) industry. The company is on the smallish side, but the products and appliances they offer are excellent, with a fantastic cost/benefit advantage. They compete with some of the biggest and best known companies in networking, security and similar technologies, and they do so without a huge physical infrastructure, local/on-the-ground presence or a well-known brand. As a result, they have to compete with not only the quality and competitiveness of their offerings but more specifically with their commitment to the marketplace.

In what seemed like an echo to the words I wrote here last month, when asked what I thought it would take for his company to expand its success in the region, I told him the following:

• Your company has to be willing to invest for the long-term, in people, talent, product, services
  
  
• You have to be willing to create a presence, and not expect results through once-in-awhile efforts
  
  
• Your credibility is earned over time, with consistency and actions, not words
  
  
• Your brand has to be positioned and nurtured to establish it as worthy of the region's business; you have to earn the right to do business in Latin America
  
  
• You must create value in what you offer, and not just expect pricing or discounting to lead to long-term success
  
  
• You have to become "local" in every sense of the word, and reach your consumers, customers and partners by ways they deem appropriate or useful, not necessarily by your ways

When I finished running down my list of attributes and qualities that in my experience have proven to be tried and true, he said, "I couldn't have said it better! That's exactly what I think about doing business in Latin America." So, in sum, it's not just my experience that underlines these realities in Latin America, but the experience of others that corroborates these realities.

Will every firm take this approach? Certainly not! There will be those that prefer the quicky method, the Wall Street-driven "gotta have it now" approach, but in the end, these will not garner a long-term presence. They will pass through, and their presence will be short-lived. Latin America has changed immeasurably in the past 20+ years, and consumers and buyers throughout the region are far more demanding now about who and how they engage with for commerce, for investment or for any number of other opportunities that continue to arise within the southern neighbors of the United States of America. Which approach is your firm taking? Is it the right one?

Personal Relationships and Business

On a recent radio "article" on NPR, (National Public Radio), the topic was about doing business in Iraq, and all the billions of dollars and euros that are being earned by companies from around the world, mostly non-American corporations. The basis of their earning this business and these revenues? Their willingness to establish themselves, on a personal relationship basis, with the ministries and departments within the Iraqi government, to earn the right to compete for contracts, projects and other investments planned for 2009 and beyond. To paraphrase one commentater: the Westerners are only interested in getting the job done, getting the answer quickly and moving on. The others are willing to stick around and build up the trust and involvement required by these consumers (government or otherwise) even if that means spending a lot more time and effort.

This brought to mind the very real circumstances that exist today in Latin America. It is not simply a matter of having an American executive open up his/her rolodex and start making calls to garner business in the region. Likewise, it's not an effective strategy to drop in for a once-in-awhile meeting or sales call with prospective customers (private sector or government) and expect that meeting or that call to create the necessary elements to winning any substantial business.

Just as in the Middle East, and Asia and most of the world, consumers (executives, corporations, small and medium businesspeople, etc.) are going to insist on establishing with you, your company and your offerings a working, personal relationship. As a friend of mine from Argentina said to me recently, "No one wants to do business with someone who is not committed to the relationship." So, a glad-handing representative from anywhere (even within Latin America) will likely fail to win the business by seeking the quick, easy path to success. Instead, it takes time, effort, actions, investments and a lot of commitment on the part of anyone or any company that wants to earn the right to provide service, products or solutions to customers in Latin America.

Don't believe me? Ask a Latin American what they look for most in a vendor or supplier relationship. Better yet, ask yourself if you're using a long-term approach to building credibility and thus positioning yourself and your company's offerings to best serve the needs and potential wants of your prospective customers in the region. By doing so appropriately, you'll find that success comes to you much more completely, and for the long-term, rather than quickly.

For more information on doing business in Latin America and the world, see:

www.TopExec.org

Thanks for reading, and see you next time.

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2008.