Globalization is going backward Richard M. Brandt (Iacocca Institute, USA)

1. R I C H A R D M . B R A N D T
D I R E C T O R
L E H I G H U N I V E R S I T Y
I A C O C C A I N S T I T U T E
SENZATIONS
September 1, 2015

2. RICHARD M. BRANDT
Director, Iacocca Institute
Dick Brandt is an international consultant, advisor and accomplished public speaker. He has had over 15 years of experience in managing international business
operations, while serving in various Vice Presidential positions during a 25-year career at AT&T and Lucent Technologies. International operations for which
Mr. Brandt assumed responsibility included all activities associated with sales, project implementation, technical sales support and staff in over 25 countries in
Asia, Western Europe, Eastern Europe, the Middle East and Africa. These responsibilities led him to direct discussions of international business issues with
world leaders such as the former President of the PLO, Yasser Arafat and Jiang Zemin, former President of the PRC. Mr. Brandt also served on the Board of
Directors for five international ventures in Singapore, the PRC, India, Poland and Russia. He assumed the position of International Sales Vice President in
1989 and concentrated on opening up the Asia/Pacific market for AT&T starting with Korea and Taiwan. Dick then established several joint ventures and
expanded operations to 15 countries in Asia by 1994. During this time, Dick led several hundred sales and support staff with hundreds of millions of dollars in
annual sales.
In 1970, Dick Brandt began his career as a sales manager for Ohio Bell. Ten years later as a principal consultant for AT&T International in Dublin, Ireland, his
international work began with the establishment of AT&T's first international company. Mr. Brandt spent over 14 years living and working overseas, beginning
in Ireland and continuing in Italy, Australia, New Zealand, Hong Kong, and the Netherlands.
His personal and professional experience in marketing, team leadership, joint ventures and global business architecture and management has given him depth
and perception that he brings to both the training room and his advice to corporate clients. Mr. Brandt has developed extensive seminar materials on various
aspects of international work in the global marketplace. He earned his BS Degree from Kent State University, and he is a graduate of the Advanced Management
Program at the Harvard Business School. He also served as a First Lieutenant in the United States Army immediately after his years at Kent State in the ROTC
program. He spent two years on active duty at Fort Bliss, El Paso, Texas, and received the Army commendation medal for his work as the Public Information
Officer. He then spent five years in the Army Reserves in Ohio.
Following his tenure at AT&T, Mr. Brandt has been able to devote himself to speaking and training engagements, having delivered lectures at Erasmus
University in the Netherlands, Rome University in Italy, the World Economic Forum in South Africa, and Loyola University in Europe, plus training for Warner
Lambert (The Sales Process in Japan), Bristol-Meyers Squibb (Doing business in Australia/New Zealand), Rohm & Haas (Asia Pacific Business Training), and
Baruch College (Establishing International Joint Ventures).
Dick has been employed by Lehigh University for the past 18 years. He serves as the Director of the Iacocca Institute in the Office of the Vice President of
International Affairs, and has been the Director of the renowned Global Village Program for Future Leaders of Business and Industry for 15 years. The Global
Village Program delivers its learning through interactive courses, multi-cultural teaming experiences, business and organizational visits, executive round table
discussions, themed panel and seminar sessions. Since its inception, this program has welcomed 1750 young leaders from 133 countries – all of whom are part
of the Global Village worldwide alumni network.
In addition to delivering the International Business courses at The Iacocca Institute at Lehigh University, Mr. Brandt has also taught Business One for seven
years at Lehigh’s College of Business and Economics. He currently facilitates a session on international negotiations in the innovative Integrated Business and
Engineering Honors Program. Additionally, Mr. Brandt has taught the Business Policy course in the Executive MBA Program at The Zicklin School of Business,
Baruch College, and The City University of New York. He has also taught executive education programs for Long Island University.

3. WHAT I HAVE DONE AND WHERE I HAVE DONE IT
 Started with the first international company for AT&T in 1980
 One year in Ireland to develop a Strategic Plan for An Board Telecom
 Two years in Italy to structure a Major Accounts Sales Organization for SIP
 Two years in Australia to establish a National Sales Organization for Telstra
 One year in New Zealand to create a National Sales Organization and nationwide
distribution chain for the New Zealand Post Office
 Three years in Italy and Greece to establish the first AT&T offices
 Four years in Hong Kong to run the Network Systems (Lucent) sales force for Asia
 Two years in The Netherlands for sales and product management in Eastern Europe,
Middle East and Africa

4. If you could fit the entire population of the world into
a village consisting of 100 people,
maintaining the proportions of all the people living on Earth,
that village would consist
60 Asians
15 Africans
13 Americans (North, Central and South, Caribbean)
11 Europeans

5. There would be:
50 women and 50 men
1
33 Christians, 23 Muslim, 14 Hindu, 7 Buddhist,
12 other religions
2

6. 6 people would possess 59% of the wealth
80 would live in poverty
70 would be illiterate
50 would suffer from hunger and malnutrition
1 would be dying
1 would be being born
1 would own a computer
1 (yes, only one) would have a university degree

7. If you currently have money in the bank, in your wallet and a
few coins in your purse, you are one of 8 of the privileged few
amongst the 100 people in the world.

8. Globalization is Going
Backward

9. Globalization-“The Times They Are Changing”
 Past seven years presented Globalization Going
Forward
 Rise in Connected Countries (Political, Security,
Economic)
 BRIC’s are the rising new markets (Brazil, Russia,
India, China)
 World broken into CORE (connected) and GAP
(Disconnected) countries

10. Move Over BRIC’s—Here comes the MIST’s
 BRIC’s are still the largest emerging markets
 Investment Banks are supporting new fast-track
economies
 Mexico, Indonesia, South Korea, and Turkey
 Young populations of educated young people get
attention
 Add Nigeria, Bangladesh, Pakistan, Philippines and
Vietnam

11. Why the shift from the BRIC’s
 The BRIC’s are turning inside instead of outside
 Investment in new MIST markets up 12%
 Investment in BRIC’s is up 3%
 Investors are withdrawing Billions from BRIC funds
 Ease of doing business still up in BRIC’s

12. Countries Unable to control inside their borders
 Magnet for terrorists, drug cartels, pirates, human
traffickers, and criminal enterprises
 Short list of Yemen, Somalia, Lebanon, Libya,
Nigeria, Pakistan, Mali, Nicaragua, Haiti, Central
African Rep., Mauritania, Afghanistan, and Syria
 Data from Council of Foreign relations – 2014.

13. America is not in decline
 Most formidable military anywhere
 World's largest Economy and better in 2015
 Workforce not aging like China, Japan and Europe
 World's best tech companies are here
 Next generation of technology is here
 Cloud computing, artificial intelligence, advanced
manufacturing and nanotechnology
 Entrepreneurial culture--What is next?

15. USA foreign policy in decline
 More governments with resources to shrug off US
influence
 Less coalitions and less trade agreements
 Less influence to lead other nations into conflicts
 Some countries move away from US Trade
dependent.

16. The Rookies take the Field
 They are birthing the new middle class
 New growth is significant
 After 2008 free markets lost some position in world
 Developing countries have different agendas and
priorities
 Democratic governments may not be the rule
 60 + countries
 Monarchies, one party governments, dictators, transitional,
countries not controlling territories

17. Globalization Has a Reverse Gear
 Sluggish Economic Growth rates
 High Unemployment
 Economic turbulence is with us
 World Trade Figures are worrying

18. World Trade—Binding our Planet
 Last 20 year trade is ahead of GDP
 GDP Grows at 4% but Trade Grows 8%
 Last 12-24 months-Trade slowing not doubling
 Some trade areas below GDP
 World Investments overseas dropped 10%

19. Largest trading nation is now PRC
 Xi Jinping wants Free Trade Area for Asia Pacific (20
countries)
 USA still working on Trans-Pacific Partnership (12
countries)
 In 2014 USA is Trade Partner for 76 nations
 In 2014 China is Trade Partner for 124 nations
 China Economic Reform Policy is Stronger State Run
Companies

20. Relationships with traditional allies are shaky
 Unhappiness with Putin is not universal
 USA Spy Agencies listening to Merkel
 Revelations of USA Prison torture anger many
 Middle East Policy in confusion-back to Iraq
 UK influence in EU will lesson
 Rise of China will cool Asian Ally support
 USA Poll says "Mind our own business
internationally" (62%)

21. What are the Signs of Going Backward?
 China’s past 20 years driven by connecting outside
 Next 10 years will be fixing the inside
 Global Financial Model was connecting outside
 Strongest banks financially are strongly local
 Even what we eat and wear is moving to local brands

22. Manufacturing costs per hour
Country Labor
Costs per
hour
Indonesia $.50
Vietnam $2.06
Philippines $2.44
Malaysia $2.97
China $3.25
Russia $3.26
Turkey $5.29
Mexico $6.83
Brazil $9.88
U.S. $38.13

23. Have we gone Too Far Too Fast in Connectivity?
 Do we understand the dynamics of what we built
 Facebook, LinkedIn and Twitter may see the reaction
first
 Too much outside exposure
 Are your “Friends” shutting down
 Are we burdened by a world with no privacy

24. US dollar dependency is changing globally
 $ has served for decades as Central Bank Assets
 USA is always "The Safest Port on the Storm"
 Attracts investment to USA and helps currency
conversion
 China, Brazil and Russia are moving away from $
 Today 25% of China trade is in RMB
 Autocratic Leaders don't promise democratic
reforms

25. More foreign nations can change globalization
 Nations may even block USA Plans
 Strongest emerging nations don't need IMF/World
Bank
 Nations creating their own lending institutions
 BRICS Created a 2014 Development Bank ($50 Bil.)
 China Development Bank and Brazil Development
Bank increase lending
 IMF ($52 Bil), CDB ($240 Bil.), BNDES ($85 Bil.)

26. The new rule for globalization
 Globalization will not promote American Values or
Best Practices