WorldCity Business Magazine

In the fast lane

by Doreen Hemlock

From its South Florida office, Brazilian construction powerhouse Odebrecht is taking on the world, building new businesses in the United States at the same time it makes inroads in Africa, the Middle East and beyond.

Drive through downtown Miamiand Odebrecht’s work stands out: the Metromover mass-transit system, the American Airlines Arena and the long-awaited Performing Arts Center now taking shape. Frequent fliers to Florida may also have seen the Orlando Airport taxiway that the company helped build or Odebrecht’s biggest U.S. project in progress, the $658 million South Terminal at Miami International Airport.

Brazil-based Odebrecht is a global conglomerate, posting overall sales nearing $8 billion annually, principally through its petrochemical company Braskem, which saw revenues of $5 billion last year, and, increasingly, through its veteran construction arm.

In Brazil, Odebrecht construction is a household name and the country’s largest exporter of services. In Latin America, it is a powerhouse while worldwide it is the biggest builder of hydroelectric power plants. Odebrecht’s construction arm records annual revenues topping $1.5 billion.

Yet few in South Florida know the contractor and its local office, which oversees operations that span the United States, Mexico, Europe, the Middle East and beyond. For even as it pulls in major coveted contracts including a communications facility in Kuwait and transmission lines in Iraq Odebrecht keeps a decidedly low profile.

Managers in Miami say they avoid publicity, instead focusing on customers, following a philosophy that dates to the company’s beginnings in 1944. Company founder Norberto Odebrecht, the grandson of German immigrants to Brazil, always preached service first “to dream the client’s dream.”

In the lobby of its understated 14th floor office in Coral Gables, there are signs the company is getting notice where it counts. On one wall, a plaque from the U.S. Army Corps of Engineers honors Odebrecht as its 1999 Contractor of the Year for its work, including an exceptional safety record, on a massive dam in California. On another wall, a certificate from Miami-Dade County proclaims March 3, 2005 as Parsons-Odebrecht Day and praises the partners in airport construction for “effective diversity practices” and outreach to small business.

How did the South American company gain such stature in the large and competitive U.S. construction field? Managers in its South Florida office credit the vision of the founder, now 85 and the company’s honorary chairman, for nurturing what he calls “future generations of entrepreneurs.” Norberto Odebrecht takes a long-term view and embraces new technologies. Along with an emphasis on service, he also encourages teamwork and openness with his staff, clients and suppliers. That attitude extends even to the handling of bids.

“We don’t take a contract at face value and bid. If it says 12 months, we plan ahead and find, through innovation, ways to be more productive,” says Paulo Suffredini, executive vice president of the U.S. unit, which operates as Odebrecht Construction Inc. “We come up with two or three options on how to build. We look at all the angles.”

Paulo Rocha, a native Brazilian and founder of business consulting company HRM International on Key Biscayne, says foreign companies like Odebrecht carve a space in the U.S. market by doing “everything by the book and even better.” To compete head on with established U.S. companies, he says, “you have to be a super company, offering excellent quality, on-time delivery and competitive price.”

Multi-part formula

Teamwork clearly matters, too. Heading the Coral Gables office are a trio of Brazilian engineers steeped in Odebrecht philosophy. Each has at least 22 years with the contractor and speaks three languages fluently: Portuguese, Spanish and English. All have experience with the company in different countries.

Luiz Rocha serves as chief operating officer for the growing roster of international locales overseen from Florida. Gilberto Neves is CEO for the U.S. unit, specializing in private sector and municipal projects. And Suffredini handles contracts with the U.S. government, including the projects in the Middle East. Together, they command about 50 employees in Coral Gables, 135 across the United States, plus thousands directly employed by Odebrecht and indirectly by its subcontractors.

Even the group’s strategy for seeking new business demonstrates its focus on teamwork and entrepreneurship.

“When we bid on work, it’s the leadership of the team that will do the work that bids. We’re not like other companies where a bid team hands off the contract to a construction team,” explains Neves.

Suffredini adds: “So if nothing else, that cuts short the blame game.”

The group also strives to practice Odebrecht’s motto of “Survival, Growth and Perpetuity,” working closely with partners to build long-term relationships. That includes offering classes to its subcontractors at Miami International Airport to boost their skills in blueprint reading, accounting and other construction basics.

“If subcontractors have the sense you’re coming to stay, there’s a sense of loyalty,” says Neves, adding that too many builders look strictly at their short-term gains.

Crossing borders

After evolving from a company focused on projects in Brazil’s northeast into a national contractor active across the country and, then, throughout Latin America, Odebrecht decided in the 1980s to try its hand in bigger and tougher markets beyond the southern hemisphere.

In 1988, Odebrecht staked out a European foothold through an acquisition in Portugal, a country that shares its home language. It bought road-builder Bento Pedroso Construes and quickly scooped up major contracts in Portugal, including a bridge project and construction on segments of the Lisbon subway system.

Entering the United States in 1990, the company took a different approach, opting to build through partnerships. As a first step, it teamed with well-connected Church & Tower Inc., a specialist in telecommunications engineering contracts. That company had a client list including BellSouth and a top executive influential in South Florida: late Cuban exile activist Jorge Mas Canosa. The partners won the bid to construct Miami’s Metromover.

“We wanted to associate with a local minority firm to start. And we did a second project with Church & Tower after Metromover,” recalls Neves, “the South Dade landfill.”

The Brazilian firm chose South Florida as its U.S. base because the area’s cultural and business ties with Latin America made assimilation easier. And it opted to leverage its Latin American experience with public works projects in transport, dams and the oil industry by pursuing mainly government projects in North America.

In 15 years, the strategy has yielded more than $3 billion in business for the U.S.-based unit. Indeed, the company has earned such a solid reputation with the U.S. Army Corps of Engineers that it followed the corps overseas. Since 2003, Odebrecht has won contracts on projects in Kuwait and Iraq sometimes completing them ahead of schedule and under budget.

Building trust with good suppliers helps, Rocha says. In Kuwait, for example, Odebrecht teamed with a promising subcontractor, even though the firm hadn’t submitted the lowest bid. Both sides knew the other offers on the table. Odebrecht asked the supplier to pare its price, but the firm refused, citing its reputation for quality. They agreed to do business anyway. “Now, this guy is our loyal partner,” Rocha says. “Openness made all the difference.”

Odebrecht aspires to have the U.S.-based unit double its revenues to $1 billion over the next three years. Growth is targeted in at least three major markets where Odebrecht already operates: United Arab Emirates, where the company has been working on airports and seaports since 2003; Mexico, where it is building two refineries for state oil company Pemex; and Portugal, where it is working on about 500 miles of toll roads.

Odebrecht’s Portugal operation also is setting up a satellite office in Romania to bid on work there, Rocha says.

The growth will mean adding staff in Coral Gables and beyond. Top managers likely will come from within, from staff groomed in Odebrecht’s values of service and teamwork.

For Miami residents, Odebrecht is changing the face of the local landscape. But the Coral Gables office is quietly making its mark far beyond Florida. “We’re becoming a new strategic base for growth for Odebrecht,” says international manager Rocha.