American businesses should lean in despite global turmoil, experts say
Despite the geopolitical turmoil around the world, experts in international trade say Utah companies should take precautions but not shy away from doing business abroad.
While there is friction, there are also opportunities.
“Lean all the way in. Do not put your head in a cave, go in a foxhole and cower,” said Miles Hansen, president of The Stirling Foundation, a Utah-based humanitarian organization with projects in more than 35 countries. Because of the momentum Utah businesses had going into the pandemic, they were far more aggressive sooner than companies in other places, and they benefited significantly, he said.
Eric Levesque, COO and co-founder of the strategic intelligence firm Strider, agreed.
“That was tough,” he said of the past three years. “The next three should be, I think, a little bit better.”
Levesque and Hansen were among the presenters at the daylong Utah Business Forward conference at The Grand America Hotel. Utah Business magazine put on the event, featuring sessions on entrepreneurship, international business, marketing, people and culture and strategy to help executives address global challenges.
Hansen previously worked as the president and CEO of World Trade Center Utah, an organization that accelerates global growth for Utah businesses. Levesque’s company uses open-source data and AI to enable Fortune 1000 companies and governments to manage risk and secure their innovation in a new era of strategic competition.
The two of them talked about the risk of doing business internationally amid the Russia-Ukraine and Israel-Hamas wars and the fraught U.S.-China relationship.
Hansen said the most important thing for any business to realize is that the world is fundamentally a different place since the end of World War II and will continue to be.
“This free market that has created so much wealth and prosperity for decades is really in some ways coming to an end,” he said, adding it was “very, very comfortable” for business to take place.
But geopolitical competition is returning in a significant way, Hansen said. That means businesses need to think about how global affairs are going to impact them, he added.
“It’s affecting more companies of every size in more industries than what we’ve seen for a generation,” he said. “You have to pay attention. You have to invest the time and energy to think through how say competition between the United States and China is going to affect your supply chain in one way or another, whether you’re making components for military hardware or you’re making components for a kids’ toy.”
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Levesque noted the meeting between President Joe Biden and Chinese President Xi Jinping this week included a dinner with business leaders.
“Xi is in an interesting spot. The way I read it is their economy is on the edge of a cliff,” he said, adding there was negative foreign investment last year in China for the first time in 25 years. Business leaders, he said, want stability.
Some companies are building capabilities in-house to understand the intelligence landscape, trade routes and cyber issues rather than depending on government or other partners, Levesque said. Dow Chemical, for example, used open-source data, geospatial data and social media to learn Russian troop movements and develop a corporate plan to protect their employees and assets weeks before the invasion of Ukraine.
“They were actually ahead of most governments in predicting that invasion,” he said.
Although that has been expensive, Levesque said he expects those costs to come down so small and medium-sized companies can build those capabilities.
Levesque said critical emerging technologies are the most targeted aspect of industries by foreign governments.
Companies can take legal measures and use cyber tools to protect their intellectual property but the part that doesn’t get talked about is how state actors might offer their employees millions of dollars for trade secrets. Businesses, he said, should educate their workers about the geopolitical landscape and how they could be targets.
“This actually is where we see the biggest risk right now to IP (intellectual property) across every company that we work with,” Levesque said. “Most of these folks are legitimate engineers, scientists and experts in their field. They’re not experts on intelligence operations or how state actors would approach them.”
With 2024 a presidential election year in the United States, Hansen and Levesque talked about what businesses might want to look for in the candidates.
“First off, someone with an IQ greater than a fifth grader. Someone who has an accurate understanding of the substance and cares about the substance,” Hansen said. “Someone who’s got real-world experience, out doing things in the world of meaning that create value.”
Those characteristics should be a given but are not among the current crop of candidates, he said.
“Find somebody who is not an idiot and that would be a significant step forward and that would give me confidence,” he said.
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Levesque said he agrees with Hansen but the counterargument is that five or six years ago the economy was great.
Two things would bring great momentum to industry, he said. First is Congress passing a budget, which would create a lot of predictability. “Somebody that could bring folks together would be great,” Levesque said.
Second, he said there needs to be long-term strategies to engage China, Russia and the Middle East. “We don’t have those yet,” Levesque said. “I think those would go a long way.”
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