The printer.

"Carvajal does things right." This simple slogan embodies the corporate culture of flexible entrepreneurship at one of Colombia's biggest and most respected companies. More than a century ago, Carvajal began as a small printing company in the city of Call Today, it's the biggest printer in the hemisphere with more than 15,000 employees, operations in 18 countries and annual revenues of more than US$1.1 billion. Carvajal continues to belong to the same family that turned it into the largest publishing house in Latin America. LATIN TRADE Editor-in-Chief Greg Brown and Spanish Editor Andres F. Velazquez spoke with Carvajal President Alfredo Carvajal about how a little family business got huge.

How did Carvajal begin its process of internationalizing?

Our strategy for internationalization began in the decade of the '60s, when we were invited by a government agency in Puerto Rico because they had no printing services at the time and the country was beginning to industrialize. They had a canning industry and needed labels, but the other reason is that the markets in Latin America are very fractured and limited in terms of growth in each country. The way to grow is to cross your own borders.

You've diversified a lot over the years. Talk about that strategy.

There are connections between businesses. The printing business is very mature and has turned into a commodity. We have been moving toward services. For example, why are we involved in call centers? We do the yellow pages in several countries, so we got into call centers because the telephone companies asked us, in addition to making their phone books, to also provide information services. Our first call center, in fact, was outside Colombia, in Guatemala. Today we have the largest call-center operation in Colombia, we employ more than 2,500 people and we are growing at a considerable rate. One of our characteristics as a company is that we are very entrepreneurial and very open to change. In the organization there are always two, three, or four new, different businesses that are related in some way to what we do. For example, we have advanced quite a lot in the business of printing photograph albums. We have a Web page where you can send photos in order to have them placed in a physical album. This business makes a lot of sense since there has been a diaspora of Latin Americans to the United States and they want to share these kinds of things with their families elsewhere in the world. We are always trying to find new lines of business.

Which of the businesses are growing the fastest?

There are several businesses in growth stages. For example, our business of office supplies in Colombia and Venezuela. Today, large companies get their office supplies by outsourcing. We are not a big-box retailer, like Office Depot or Staples. We are exclusively in the business of outsourcing. We get contracts with the businesses and they order supplies by Internet or by phone. We do the distribution in a way that they have their supplies the next day or in two days. Staples, Office Depot and others also do this, but they also have the big stores. The business has several advantages and strategic points. One is buying, as you say, in large volumes, which allows us to have greater negotiating power, but there are other important factors, such as logistics and distribution. But we have something they don't, which is that we do digital printing on demand. We supply this need, which is critical to the businesses.

Any other businesses that are growing significantly?

The yellow pages business is one of our biggest now. We have them in several Central and South American countries, and there's a lot of growth in northern Brazil. Another growing business is Propal, a paper producer that uses sugar cane waste, headquartered in Cali. Other business is our notebook and paper company, called Bico, and we have another business that makes credit cards and checks and so forth.

Do you think paper is on its way out, thanks to technology?

Paper is being replaced by electronic communications, effectively. However, there are niches where paper is still dominant. And, curiously, there is new demand for paper thanks to electronics. A good part of the demand on paper mills now is for printer paper. We see this shift, and we are trying to develop services for it, although most activity still revolves around the industrial part of the business, since we have factories in 10 countries.

What is the secret to managing all of the various cultures that make up a single company such as your own?

One has to think globally and act locally. Our organization is headquartered in each country of operation. Each country has its own domestic manager, in addition to managers in each business, although normally the country manager is also in charge of one of the businesses. Initially, the managers were nearly all from the Colombian company. Having begun our businesses with people from the heart of the company has permitted us to have a business culture. Last year we put together a mission, vision and values statement. We carried out the first exercise in which everyone participated. Next year we are going to dedicate ourselves to taking it from theory to practice. How to make it so that people live and breathe the mission, vision and values of the company? lf you are talking to people from the different countries you'll find that there is one corporate culture they share. This has been achieved over time. Permanent dialogue in a business makes it possible for this to spread.

In Latin America, it's not typical for a company to remain under the control of a single family for such a long time.

We're in our sixth generation. There are more than 200 partners in the business. The single largest shareholder is the foundation. The entire family is in the holding company, but we have 23 companies with partners in different countries. We are flexible in the sense that we understand that to grow you have to have an open mind.

One of the reasons we have grown so much during the past 100 years is that we're open to opportunities and change. As a company we have grown quite slowly. The growth we have seen has been, in large part, due to reinvesting our earnings, a long-term vision, and low levels of debt. This is the advantage of being a family company, not being tied to a share price, so you can look at the long term and make short-term sacrifices. Such is the case in terms of technology. The investments we have made on the E-Business Suite [business-process automation software] from Oracle won't provide any advantage for at least three years. It's an expense, but we're are preparing ourselves for the future. In addition, we have taken advantage of opportunities during crises. lf we hadn't, we would not have been able to make purchases like Propal nor would we have been in a position to buy businesses like BellSouth's yellow pages in Brazil. Crises are very important because they present opportunities to grow--if you are not heavily indebted and have liquidity.

What is Carvajal's plan for business in China?

At the moment we are in China only on the commercial side. China is important to us and we are interested in having better relations with the country. Obviously, it also helps us to find opportunities as they present themselves. We still have a lot of possibilities for growth in Latin America to build upon. In Mexico, in the publishing field, we are textbook makers for the schools. We want to continue to grow in our notebook business. Today we are the largest manufacturer of notebooks and we are going to continue to build that business. We are merging two or three yellow pages businesses that we have in Brazil in order to have total coverage in that market. Currently, we only cover the states of Rio de Janeiro and Minas Gerais and with this move we will completely cover Brazil in yellow pages. We are the biggest yellow pages company in Latin America. We are the biggest publishing company in Latin America.

What is the future of the yellow pages?

Paginasamarillas.com is clearly going to grow more than the paper version. But the telephone directory is still very much in use. Six years ago a very large consulting firm told us that yellow pages business was going to shrink very rapidly and we even were in the process of selling the business. Fortunately, we didn't sell because one of the ways that telephone companies financed themselves during hard times was selling their yellow pages businesses, and there were several interesting sales. This is still a relevant business. There are businesses for which a yellow pages ad is very important, like the moving business. When one looks in the yellow pages, 80% of people have already decided to buy, the only question is from whom? We have testimonials from a Colombian company that failed and later said that one of its mistakes was to no longer appear in the yellow pages.