An interview with Humberto Ribeiro, former Brazilian Secretary of Commerce and Services reveals how entrepreneurial spirit can be mirrored at the country level.
by Larissa Wecshler, MBA ’15
Humberto Luiz Ribeiro is a Brazilian entrepreneur, who has started and operated various ventures in the IT, outsourcing and bio capacity sectors.
In 2011, he was appointed Secretary of Commerce and Services in the Brazilian Ministry of Development and Foreign Trade and served for 3.5 years. He led a team that promoted major transformational initiatives within the government, such as streamlining processes for opening a business from 120 days to 48 hours and helping to create and formalize 4+ million new businesses. His team also created the Official Catalog for Investment Opportunities, a support instrument that helped to attract a country record of US$200+ billion in foreign direct investment from 2011 to 2014, and directly promoted public policies to foster entrepreneurship and achieve the lowest unemployment rate in Brazil’s history. His emphasis on developing new services industries and modernizing local supply chains, resulted in annual growth rates from 4 to 12% during his term for these segments.
In August, 2014 he joined Cornell University as a Visiting Scholar at the S. C. Johnson Graduate School of Management. With the supervision of Prof. Lourdes Casanova, Academic Director of the Emerging Markets Institute, the focus of his research, entitled ‘Emerging Services’, is the growth of the services sector in emerging and developed markets and new perspectives on global trade in services.
Humberto holds a Bachelor in Civil & Environmental Engineering from the University of Brasilia, an MBA in Government Administration and has participated in executive programs at MIT, INSEAD, the Wharton School, and Georgetown University. He has been a member of the National Leaders Forum Brazil since 2001. The World Economic Forum nominated Humberto as Global Leader for Tomorrow in 2002, recognized one of his companies as a Global Growth Company in 2007, and asked him to serve as a Global Council Member in 2012. He is a recipient of numerous awards and recognitions, including the Federal Medal of Victory from Brazil in 2014.
Can you tell me about your experience as an entrepreneur, before joining the government in 2011 as Secretary of Commerce? What are the differences between working in the private sector and the government?
It is very different and both were greatly rewarding, but from different perspectives. The for-profit perspective of the private sector pushes you into shorter-term efforts, tightly tied to market conditions – customer needs, competition, differentiation, etc. – with tangible, down-to-earth metrics for growth and profits.
At the government, the pursuit is different, as you are working for a cause, something bigger. You also engage in short-term efforts, but envisioning long-term consequences that will sustainably benefit the nation. It is a national cause that you are developing and you want to bring results. Sometimes you cannot do everything that you wanted, but you do as much as you can. There are different stakeholders that you have to take into consideration and help them converge into a common decision, and different political interests that should also be considered. There are also different mindsets as the culture is not the same across the government in a country as big as Brazil. Despite these and other strong constraints, such as budget, infrastructure and outdated laws, many transformations were implemented.
I am fortunate to have had the chance, in both private and public sectors, to be part of awesome teams, and together we were able to accomplish relevant results and make many dreams come true.
What are the accomplishments in your career that you are most proud of?
In 1997 I was 25 years old and full of aspiration. In that year we designed a platform that would bring together companies in a B2B ecommerce, procurement solution, putting in practice a website called “Superobra.com”. From 1997, going through the Internet bubble, up to 2002, we managed to grow it, surpassing over 100 direct competitors in Brazil to become the largest portal in the country in that segment. The initial website would bring together construction companies and their suppliers not only to negotiate their procurement solutions, but also to optimize their supply chain. At that time, we were not only competing against direct competitors like other portals, but also competing against fax machines and phone calls.
In 2001, with our solid penetration in Southeast and Midwest parts of Brazil, we decided to take the platform to other segments, such as food and energy companies. In 2002 we were recognized by the World Economic Forum as one of the most successful Internet cases throughout the world. In 2002 we also started working with state and federal governments as the Brazilian government was interested in using electronic procurement systems aiming cost reduction and transparency. So, from 2002 to 2004, we customized e-procurement platforms for multiple public institutions. This is actually how I became familiar with Politec, who happened to be a strong IT service provider for many of our governmental clients. Later, in 2004, they invited me to the company to work as their Chief International Officer, designing and implementing their Global Reach strategy.
Can you tell me a little about the projects that you worked on at the Brazilian government that you believe really made a difference?
Our term in the Brazilian government marked the consolidation of the Service Industry into the national public policy. Measures taken and policies launched covered international trade, tax alleviation, reduction of red tape and others, and helped to provide one of the most fruitful periods for investments, job creation and growth for the tertiary sector in the Brazilian history.
In that scope, I think one initiative deserves a special highlight. It is known that the Brazilian government currently has a very strong social inclusion mindset and dedication, which, in a country still with contrasting inequalities like Brazil, I totally support. So, we always considered how this social inclusiveness policy could be mirrored in the private sector. Together with then Minister Fernando Pimentel, who is now Governor of Minas Gerais state, and multiple federal and state-level partners, like SEBRAE, we augmented measures to reinforce the formalization practice for SMEs. Therefore, we redesigned the process behind opening a business in the country, reducing governmental requirements and tax burden, thus favoring entrepreneurship for every company, but mostly for the smallest ones. In fact, these measures helped not only the establishment of start-ups, but also brought many existing businesses from the grey market into compliance. Over 4 million companies were registered in Brazil during that period, an impressive result!
What challenges do you believe the Brazilian government is going to face in the next few years?
I think that the macro agenda of Brazil transitioned from laminar into turbulent flow due to the more recent political and social unrest. On top of ongoing endeavors for public and private sectors, a corruption scandal at Petrobras, the country’s largest corporation, impacted credibility of leaders. The challenge for the country is now how to proceed implementing its economic emergence agenda amidst this strong internal turmoil.
Actions recently taken towards anticorruption and law enforcement are important, but I think it will take some time for the population to understand and embrace an increasingly transparent and compliant way of living. Transformations must take place in the media, financial and government sectors, to name a few.
In the meantime, I hope that the transition towards a more services-driven economy does not stop. The service sector is by far the fastest growing in Brazil and it should continue to be the protagonist in investments, despite the usual governmental privileges for the manufacturing and primary sectors. The growth of services represents increased well-being for the population, innovation for entrepreneurs and efficiency for local supply chains.
Just to bring up one example, to be competitive with other cost efficient countries, Brazil needs to proceed renewing its logistics system, through investments and concessions for roads, airports, ports and rail. Also, the country should improve policies for entrepreneurial investments, such as renewal of its truck fleet, currently with an average of 18 years-old. Having efficient logistics networks and capable operators is essential to be competitive and to promote the country’s development.
Can you tell us about your experience at Johnson Graduate School of Management?
On top of being part of Cornell University, which provides a unique opportunity for cross-learning in an incredible array of knowledge, Johnson is in a very interesting moment, expanding its presence and partnerships in the US and beyond. Also, with Cornell Tech, in New York City, Johnson has an incredible opportunity to leverage the city’s financial and entrepreneurial capacity with knowledge in business and global connectivity. The school is moving in the right direction, invigorating the curriculum and preparing students for a more competitive, digital and global environment.