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U.S. Energy Production Is a Bright Spot The financial crisis ended up having a ripple effect on all aspects of the global economy, says Doug Baker. Demand for products and services lagged, employment levels fell, access to capital became more difficult, and aid to developing nations slowed. These impacts first hit the developed markets and then spread throughout the world. “Businesses slowed the implementation of growth and capital improvement projects to focus on strategies to effectively navigate the economic conditions,” Baker says. “Ecolab was able to manage these challenges well, but not all enterprises were as fortunate. The economic downturn led to great fractures in global trust, and the heightened uncertainty has impacted almost all business decisions, especially those related to investment, hiring, and growth.” However, there was one bright spot during this period—the unprecedented rise in U.S. energy production. “It has significantly improved the attractiveness of the U.S. market,” Baker says. “The industry’s shift toward the U.S. and related increase in capital will provide economic benefits for decades to come.” Globally, trade and capital flows are starting to improve, but they are still a concern, Baker says. “Moving forward, how each country chooses to manage trade will affect the global economy. Countries that choose to enact protectionist trade policies will significantly limit growth of the global marketplace,” he says. “At the end of the day, I do not believe the impacts of the recent economic downturn will be major factors in our long-term competitiveness. We operate in a global marketplace, and the global markets will recover and accelerate.” Doug Baker Chairman and CEO Ecolab Agility is Key to Sustainable Growth As the world and its consumers have changed dramatically since 2008, organizations have had to move quickly and strategically to position themselves for sustainable growth. “There are several demographic trends driving growth opportunities, including women’s increasing role in the economy and the progress of emerging markets,” says Thia Breen. “In many countries around the world, more women are entering the middle class and enjoying higher disposable incomes. This increased purchasing power is changing the dynamic of global business; impacting the consumer base for many organizations and how they innovate, market, and sell to women.” Breen adds that strong market growth is coming from emerging markets such as China, the Middle East, and Latin America, which have a lot of space for innovation. “The middle class is growing and consumers are younger,” she says. “Consumers’ expectations in these markets are advanced and they expect the newest groundbreaking technology and products.” However, because the world economy is continually in a state of flux as emerging markets grow rapidly, many established markets experience softening at the same time. “The key to sustainable growth during economic turbulence is agility—the ability to grow in both strong and soft markets,” Breen says. “Many organizations that do this well are able to quickly read and convert market information into insights and balance their investments across consumer demographics and geographies to maximize high-growth opportunities.” SPRING 14 CAR2L0SON SCHOOL OGFE MENMTA NA 15 Thia Breen, ’72 BS Group President, North America The Estee Lauder Companies


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