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Digital Transformation - Opportunities and Threats in Latin America

By now, the buzzwords and ideas are familiar to most if not all; Industry 4.0, IIoT, Machine Learning, Artificial Intelligence, Edge, Fog Computing… The technologies and processes that are driving the waves of change in industries for manufacturing to agrobusiness and everywhere else represent the greatest opportunities for advancement in decades but they also present a potential threat to a great number of businesses in developing markets and particularly in Latin America and the Caribbean. Many of the firms throughout this region are small-scale, family owned employers which are critical to local economies. Without these enterprises, the quality of life and availability of jobs and services would be greatly impacted.

Until recently, smaller enterprises such as manufacturer’s of both domestic and exported goods have relied on labor cost differences as well as proximity to local markets to remain viable against more global competitors. Even so, the participation in the value chain of companies throughout the region has been low and under even greater threat as technologies allowing improved efficiency and speed allow large manufacturers to move outsourced production closer to the end user.

For regional companies serving both export and local markets, the option to put off adoption of technology is no longer viable and it is no longer necessary. As technology continues to develop rapidly, costs are coming down at an equal rate. The key now is in applying these technologies in a way that has a nearly immediate value to the business.

One advantage to manufacturers that have been slow to adopt automation, is that there is now an opportunity to leverage small scale technology and cloud service offerings to make a leap forward and to be more agile than larger enterprises that have previously invested in legacy infrastructures. The model requiring large investment in factory automation systems with payback measured in years is no longer the norm.

The ability to innovate and to take advantage of these new opportunities already exists, what most of these companies need now is support in identifying the use cases and the technologies that will allow them to quickly and economically impact their businesses.

#LatinAmerica #DigitalTransformation #Industry40