The learnings of a world traveler
The two biggest challenges Luciano Guidolin, 33, has ever faced arrived at the same time
written by ◦ Nelson Letaif

In mid-2004, he became responsible for the Braskem Polyolefins Unit´s exports area shortly before the K-Fair, the largest plastics trade fair in the world, which is held every three years in Dusseldorf, Germany. This would be Braskem´s first participation in such an important event, and its main international clients, particularly the Europeans, would be visiting the company´s stand to discuss business and future plans. Three days before the K-Fair began, Guidolin became a father for the first time. He spent four days at the hospital with his wife and child in São Paulo, took them home, and flew to Germany in time to take part in the fair. “Taking that flight was one of the hardest things I´ve ever done,” recalls Guidolin. “But nothing comes without sacrifices, and it has all been worthwhile.” He has since taken many international flights and collected numerous stamps in his passport, as well as – and most importantly – broken records for Braskem´s exports: they totaled over USD 500 million in the first half of 2005. Guidolin shares the credit for this achievement with the entire Braskem team, and they are all justly proud, but he has a special reason to celebrate. He joined Odebrecht 10 years ago as an intern fresh out of the University of São Paulo Polytechnic, where he graduated in Production Engineering. In the petrochemicals sector, he worked in the Corporate Planning area, and took part in the merger process that created Braskem, and was responsible for Marketing and Development at the Vinyls Business Unit. He has also spent two years in Boston, Massachusetts, where he earned an MBA from the Harvard Business School, summa cum laude. “I´ve had the opportunity to take on growing challenges that I never dreamed would arise so quickly or be so major. This demonstrates that the Group truly believes in young people and their desire to grow.”

Odebrecht Informa – Braskem has published its results for the first half of the year, including over USD 500 million in exports, which means a projected USD 1 billion for the year. Only a select group of Brazilian companies has achieved that figure. How is this possible?

Luciano Guidolin – First of all, our production units have achieved highly positive performance. Braskem´s investments in the expansion of these units have increased our production capacity compared with last year. Productivity and operational reliability have also increased. Part of that production is earmarked for export. We have developed our logistics structure to support the sales drive focused on the foreign market. In the last nine months, we have also gone through a period of higher prices and margins in the international market. The result of all of these experiences has been that both volume and profitability have grown. Furthermore, Braskem has prioritized some foreign markets, including Argentina and Chile, where the company is taking important steps to increase its market share.

OI – How are these efforts being rewarded?

LG – This year, Braskem has recorded significant export figures for polyolefins. We broke three records in the field of exports in the last eight months. In addition to making us very happy, this has created a tremendous challenge for our sales, production and logistics teams, because the company is working with unprecedented volume.

OI – In addition to growing its export revenue, has Braskem increased the list of buyer nations?

LG – Yes, we are now exporting to over 50 countries and have adopted a strategy of gaining access to international markets that focuses on establishing a closer relationship with each distributor and end client. We have established South America as our natural market, where we provide service that is similar to what we offer our Brazilian clients in terms of proximity and the intensity of services, while establishing regular distribution bases and a constant flow of products to some European countries, as well as Africa and Asia. This year we have seen important growth in South America and increased our presence in the Asian markets. Our aim is to maintain a level of exports that ensures they always represent something like 20% of Braskem´s net income.

OI – Is there any product in particular that stands out among the company´s exports?

LG – One of the highlights is Utec®, the registered trademark for our ultra-high molecular weight (UHMW) polyethylene, which is produced at Camaçari. It is a high-value-added engineering plastic used in technical parts, fibers used to make bulletproof vests and other applications. Braskem is the world´s second-largest manufacturer of the product. It is a high-performance plastic resin developed by Braskem engineers in our own labs, which gives us competitive advantages over century-old international petrochemical companies. This demonstrates that we can also satisfy our clients´ needs in the special resins segment. We want to become the world´s leading Utec supplier by 2010, which will mean doubling our production volume during that period. This presents a highly motivating challenge for the foreign sales team and the Utec business. We recently won the Abiquim Innovation Award for Utec. The Brazilian Chemical Industry Association bestows this award on companies with outstanding performance in the field of technology. It represents the recognition of the entire industry in Brazil for the success of this product and Braskem´s development efforts.

OI – Why did Braskem decide to establish a strategic presence in international markets, instead of relying on circumstance, like some companies, to compensate for downturns in the domestic market?

LG – Braskem understands that exports are always going to be an important part of its production and sales strategy. They already represent about 20% of the company´s total earnings. Exports are key to not only optimizing and maximizing production but to positioning Braskem as a company that aspires to grow into a leading, world-class petrochemical producer. This international presence demonstrates that the company has products of recognized quality and long-term relationships with its clients both in Brazil and abroad. Braskem also has a strategy of gaining more profitability for its operations through long-term contracts. We have already established contractual relationships with clients on three continents. The aim of these contracts is to gain more profitability through a closer relationship with clients when offering products and services. Braskem´s growth plans will definitely make the company a player in the world market.

OI – Will these growth plans eventually benefit domestic consumers as well?

LG – Our Brazilian clients will definitely enjoy the benefits. The international market is highly competitive in terms of prices and the efficiency of the supply chain. This directly impacts the development of products and new solutions, the improvement of logistics processes, packaging and so forth. As a result of all of this, Braskem is developing its processes and becoming more and more competitive. Braskem is also increasingly providing support for those clients who are starting to take an interest in operating outside Brazil. Our sales office for Utec in the United States has also tended to be an “incubator” for Brazilian companies. A major client of ours is being “incubated” by our office in the United States and will develop its operations in that country on the basis of Braskem´s experience there. We are also placing our experience at the service of our other clients. I should stress that the support Braskem provides its clients is making them more competitive and giving them more exposure in the world market, thereby increasing Brazilian exports of manufactured plastic products.

OI – Is the export market as profitable as the domestic market?

LG –The profitability of our South American operations is similar to those in Brazil. These are natural and strategic markets for Braskem. In other parts of the world, results from exports have been lower, but they have also made an important contribution to the company´s cash flow. Furthermore, they have given us access to financial operations that provide export guarantees, which is another way of reducing Braskem´s capital expenses. Exports are creating value for the company and establishing Braskem as an increasingly international company with steadily diminishing business risk in the eyes of the world markets.

OI – Is Braskem prepared to become a global supplier for major international companies?

LG – Absolutely. A major client has compared us to the world´s leading plastic resin producers. That client manufactures packaging, and we are their suppliers on three continents, which puts us in a highly positive position, both from the standpoint of the product´s performance and service, logistics, etc. We are easily able to analyze and provide services for any contract or partnership. However, we must do more than supply products to clients in other countries. We are chiefly interested in establishing long-term relationships with strategic clients. That is what enables us to make increasing improvements to our products, reduce supply chain costs and create value for our shareholders and our upstream and downstream operations.

OI – Have your work routine and life changed very much since you took this job?

LG – They´ve changed a lot. On the personal level, it has been extremely interesting to come into contact with different cultures, people and partners around the world. This sort of work involves a great deal of travel, time spent in airplanes and stamps in my passport; long-haul flights and lengthy stays away from Braskem´s headquarters. But all my travels have been a very valuable and interesting experience in terms of relationships and cultural perspectives.

OI – Is fluency in English the only requirement, or do you need to brush up on other languages before coming into contact with different cultures?

LG – Today, it is vital to have a good command of the English language, as well as Spanish, which is increasingly becoming a key factor. As for other languages, such as Mandarin, Korean and Japanese, we always get the help of an interpreter or a business partner who speaks the language. In the future, Braskem´s members will include people who speak all of those Asian languages fluently, because China, South Korea and Japan are very important markets for us.

“Exports create value and establish Braskem as an increasingly international company with steadily diminishing business risk in the eyes of the world markets”

OI – Does protocol sometimes require unusual behavior by Brazilian standards?

LG – Of all the cultures we have come across, Asia is certainly the most different from Brazil. Protocol requires endless dinners with a long series of toasts, which has been a very unusual experience. In the Chinese culture, for example, the host chooses a complete dinner menu and the guest is specially asked to try every single dish that is put on the table. Sometimes the guest is given a special treat, such as eating a 50-cm fish head with his hands, and the greatest delicacy is the eyes. I experienced that in Hong Kong. It would be impolite to refuse such an honor. Other dishes, such as bird´s nests made from the regurgitated saliva of swallows, are also on the menu, as well as even more exotic tid-bits. In China, one never says no to an offer or rejects a proposal. One says “perhaps,” or “I´ll think about it.” We have to understand what our partner is trying to tell us. And we always have to have one person in a delegation who is identified as the leader of the mission. All of this has been an invaluable learning experience.

OI – Will you have the energy to continue with this challenge for very long?

LG – Being close to the front line of the business and international markets is fascinating and highly motivating. Braskem´s development program and international ambitions present years of opportunities and motivation.