Digital Transformation perspectives for use in business processes in Latin America


Digital transformation is not a mere application of technologies in the business environment. It is a continuous process of change that involves changing business models and changing the culture within any company.

Digital transformation is something that companies must undertake as a path to achieve aggiornare to changes in business and consumer demand, to maintain competitiveness.
Digital transformation is something that companies must undertake as a path to achieve aggiornare to changes in business and consumer demand, to maintain competitiveness.

Mexico is one of the countries in the region that represents one of the most dynamic economies in Latin America. Through the conditions it offers, countless companies find here the possibility to establish themselves and develop their growth.

In this sense, it is no coincidence that the country has become one of the main technological capitals of the region. It is in this scenario that the Business Digital Transformation has taken on special relevance.

This process -which involves the use of technology, the incorporation of agility practices and the strategic direction to improve productivity; the speed to adapt; in addition to the experience of the final clients of any business- is becoming a trend that more and more companies are adopting. However, the road is still long.

According to IDC, only 23% of the country's large corporations have initiated this technological change in their processes. The same source reveals that, by 2021, 40% of the region's GDP is expected to be digitized, so companies in the national territory cannot lag behind in this change. In this evolution, the Latin American region is advancing by leaps and bounds.

Business digitization

Prospects indicate that, for the next few years, in Mexico and the other countries of Central and South America, there will be growth - in each productive sector - driven by digitally improved offers, operations, and relationships.

According to data also provided by IDC, worldwide investment in technology and services necessary for companies and organizations to achieve this change will reach US$2.3 billion by 2023. Thus, process manufacturing and discrete manufacturing (automobiles, domestic industrial equipment or computers), in addition to retail, are expected to be the fastest-growing industries. But that's not all.

Within five years, nearly 70% of all IT spending in the region will go to "third platform" technologies and services (cloud computing, big data, social business, and mobility), as more than 75% of companies will create "digital native" IT environments to thrive in the digital economy.

In this context, the business model may adopt different formats. One of them is the "peer to peer", which directly contacts the two parties carrying out the transaction. Services such as Airbnb and Uber are among the most outstanding in this classification.

For its part, the economics of subscription also gives rise to initiatives of another nature - known as "freemium" - that advertise products or services for free and, in parallel, offer another variant "premium" for those who want content of a higher quality or free of advertising (as is the case of Spotify).

It is obvious that traditional companies do not have to immediately incorporate all these Digital Business Transformation practices. But if they don't open up to this trend, they run the risk of their business being "consumed" by Tech initiatives with greater flexibility and capacity to respond to what customers are looking for, said América Retail.



The most recent study, elaborated by the Laboratoria startup and called "Transformación en la era digital y los 5 motores del cambio" (Transformation in the digital era and the 5 engines of change) deals with the current situation of the digital transformation process that Latin America is experiencing.

The report, based on the opinion of nearly 1,300 workers linked to more than 900 companies in Latin America, found that 72% of workers in large companies talk about "technology" or "digital" when explaining what the digital transformation is, while only 12% refer to "culture", according to an article on the American website. Sixty-five percent of those surveyed say that the process of transformation in their workplaces began with an investment in technology or in methodologies for digital development.

The existence of traditional organizational culture was the most mentioned obstacle, followed by company policies, the lack of a clear strategy and the need for qualified talent. More than 80% said that one of these factors is the main brake to transformation in their organization while only 5% of the answers point to the lack of adoption of technologies as one of the obstacles in this process. The main result of the survey was that there is a limited understanding of what digital transformation really means.

Laboratoria is a social startup whose mission is to train women and companies for a more diverse, inclusive and competitive digital economy.

"Culture, talent, strategy and organizational structure must stop being barriers to become engines of transformation. Technology must continue to play a role, but in conjunction with these other factors," said Ana María Martínez Franklin, Partner & CMO at Laboratoria.

Regarding the level of digital transformation in companies, almost 70% of large companies claim to be "in progress", while in relation to SMEs, this number reaches 50%. In turn, the proportion of SMEs in the "early" stage reaches 33%, a much higher indicator compared to large companies, which only reach 15%.

One relevant aspect is that the study reveals the need to broaden the shared understanding of the digital transformation. Aspects such as talent, culture, strategy and organizational structure must cease to be obstacles to become true drivers of this process that will allow organizations to maintain and increase their competitiveness in today's fluctuating markets.

By Mexicanist