Being an economic junkie, nothing excites me more than the view of building cranes, ready-mix concrete trucks clogging major arteries, gleaming steel plants, and hurried business people packing airport food joints and flights. So when I get tired of the American and European debate on why neither continent is growing, I head to Brazil for a fix, which is what I did last week. I came back with a cold (it’s winter time in Brazil) and a treasure trove of new insights on the role of business in generating economic growth.
I was particularly amazed by my stay in Porto Alegre, the largest city in the most Southern Brazilian state, Rio Grande do Sul. Porto Alegre is best known for its beautiful women (Gisele Bündchen was born there), but its economic vibrancy is deserving of at least equal attention. I wish I could take low-energy managers of US corporations and members of our dysfunctional US Congress to see how the various parties of Brazilian society build their growth agenda together. Porto Alegre is arguably the co-creation capital of the world, because it brings together enlightened corporate management of individual businesses, a visionary business confederation of industries, and city, state and federal management.
Corporations are the heart of the Brazilian economic system. I participated in a session with the management team of Hospital Moinhos de Vento (literally the Windmills Hospital, also the name of one of Porto Alegre’s neighborhoods). One of the greatest joys of business educators is to see companies achieve great results and tell their stories, improbably giving us credit for having provided some conceptual structure for their tremendous accomplishments. The two leaders of the hospital told stories of doctors in the neonatal ward developing a new awareness of the mother’s emotional experience, or of nurses catering to the patient’s family needs when major diseases such as cancer strike. They described unemployed poor people receiving an education provided by the staff, so that they could become the construction crew for the new hospital, or develop into nurses that vaccinate rural populations, traveling through the pampas on shiny new motorcycles. Beyond the human aspect, the leaders of the hospital were also able to describe how they had doubled occupancy and revenues for the hospital, with profits to boot. I could not help but notice how easily they moved back and forth between the inspiring experiential nature of what they had created, and the economic wealth they had generated for the business.
The leaders of Hospital Moinhos de Vento are not that different from health care executives I meet in the US or Europe (most are equally attentive to the human experience), but they differ on one essential dimension: they believe their business can make a difference at the societal level and therefore refuse to think of themselves as mere corporate care-takers. They’re not solely focused on reimbursement schemes and regulatory negotiations. They role-model what a corporate hospital can do and proactively teach government leaders what can be achieved through private-public partnerships. They want to be actors in a larger societal play, and they view their business as the backbone of an economic ecosystem that helps them personally fulfill their higher, quasi-spiritual aspiration. While many American and European business people have given up on the societal role of business, they firmly believe this is their mission.
Challenged by this corporate vibrancy, the government is responding in kind, reaching for new modes of interaction with business and citizens. In Porto Alegre, citizens are able to propose projects at the grassroots level and debate why these projects are selected or rejected. For the projects that have been selected, they can track and influence progress. The state itself has devised an elaborate multi-stakeholder planning system that engages all constituencies in a live co-creation process. The federal government of Brazil is also experimenting with new co-creative approaches involving industry and the various states.
Of course, Brazil is far from perfect on many dimensions, facing multiple issues such as public corruption, street crime, and some resurgence of inflation. But when it comes to developing the future model of business-government relationship to foster economic growth, my money is on Brazil. Maybe we should all spend a few days a year in Porto Alegre, even if Gisele Bündchen no longer lives there.