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3 Things to Watch During the Economic Recovery When compared with the shocks associated with the 2008 recession, the circumstances today are a night-and-day proposition, says Bob Duffy. With a Robert Duffy, ’68 BSB modest global economic Partner Emeritus recovery underway, the A.T. Kearney U.S. has reasonably good short-term and longer-range prospects, Europe is pulling itself out of negative growth, and key emerging markets such as China and India are restoring dynamism to their economies. All of these developments have affected international competition in a big way, and Duffy says there are three related factors worth watching. First, advanced economies are staging a comeback. A second factor is that the U.S. has reached an important inflection point when it comes to competitiveness. “At A.T. Kearney we do a global survey of business leaders on their attitudes regarding foreign direct investment—The Foreign Direct Investment Confidence Index. This year, for the first time in a decade, the U.S. was at the top of the list as a target for investment,” he says. The third factor is a return of history when it comes to global capital flows. “The decision by the Federal Reserve System to begin tapering is, no doubt, the beginning of a global shift in the direction and volume of global investment,” he says. SPRING 14 CAR2L0SON SCHOOL OGFE MENMTA NA 17 James Lawrence Chairman Rothschild North America New Players Changed the Economic Game On the global stage, international competition has been intensifying, making new players in the market, says James Lawrence, citing the Chinese company Lenovo purchasing IBM’s mid-range server business and the Indian-based Tata acquiring Jaguar Cars. “There are multinationals now that are not American, not Japanese, and not European, that’s a big change,” he says. Having more players in the global economy has also led to another effect, Lawrence says. “American workers, be they knowledge workers or manufacturing workers, are now competing in a global marketplace. We’ve been bemoaning in this country that we have not seen middle-class wages go up,” he says. “The reason is our middle class is competing against a middle class throughout the world.” Lawrence, however, points to one advantage the U.S. has that he thinks will turn the economic tables again—acquiring new sources of energy and new exploration techniques for oil. “We’re not only going to be energy independent but a land of cheap energy,” he says. “It will lower the cost of manufacturing in this country and give everyone who happens to be an American citizen an advantage over everyone else in the world. The trend is there, and this is something that is going to happen in the next 10 years.” Company Structure Needs to Work Across Variety of Cultures For a company with 3,800 employees in 45 countries, one of H.B. Fuller’s key challenges is managing a global business. In some of its market segments, it serves global customers, and in others, it serves local, but operates globally. “We don’t consider H.B. Fuller to be a U.S. business with operations overseas; we are truly global in how we approach our day-to-day operations,” says Jim Owens. “The challenge for a global business is to develop an organizational structure that both supports achieving the company’s strategy and works effectively across a wide variety of geographies and cultures. Managing a global organization also requires a solid infrastructure to support a more mobile workforce. Investing in technology that can be accessed anytime, anywhere by our employees has been crucial to creating the infrastructure to achieve our goals.” One of the key challenges for any business today is finding, hiring, and keeping the most talented individuals. “We have invested time and resources in developing our employee value proposition, marketing the company in a very professional manner, developing strategic alliances with key universities that produce the best graduates in the disciplines that are critical to our strategy, and creating the working environment that will help us attract and keep these folks,” Owens says. “A key imperative for any leader is to understand the levels of engagement of his or her workforce.” Jim Owens President and CEO H.B. Fuller


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