Companies embracing change in Latin America's digital transformation

Mexico, Peru and Ecuador lead a regional digital transformation ranking of businesses, as 73% of companies in those three countries have at least started digitizing their operations.

The regional average is 71%, according to a study published by Spanish business school Inesdi called the Think Digital Report 2023.

The study, for which 537 companies of all sizes from Spain and Latin America were consulted, found that 25% of the businesses now undergoing digital transformation began the process one to three years before the survey took place.

The proportion of companies that started the process in 2023 fell to 17% from the 22% reported in 2022. Meanwhile, the percentage of companies that launched the process three to six years ago rose to 13% from 12%.

In 2023, companies whose transformation processes began over six years ago reached 16%, compared with 11% in 2022.

Also, 72% of companies that have not already started a digital transformation intend to do so this year.

But 48% of these firms that have not yet begun digital transformation have at least adopted social networks, while 35% have big data and analytics, and 34% generative AI.

MEXICO

Some 60% of Mexican companies undergoing digital transformation considered the process to be a success, compared with 57% in 2022.

Mexico is also the country where most companies have prioritized investments in big data and analytics.

However, 59% deem that their human capital is not sufficiently skilled to handle digital transformation, as 23% said a lack of digital skills prevented the start of their digital transformation, while 46% that had begun the process consider deficient digital skills the main obstacle to expanding the transformation.

A commitment to begin digital transformation this year, “reflects not only companies' conscious adaptation to emerging digital demands but also the strategic vision of anticipating and capitalizing on the opportunities offered by the digital revolution,” the study reads.

PERU

Peru saw a steady rise in the number of companies that have begun a digital transformation from 34% in 2021 to 65% in 2022 and 73% in 2023.

Half of the companies surveyed said that culture impeded the start of their digital transformation, while 61% admitted that employees lack the skills to advance the process.

As in Mexico, 72% of companies that have not started the transformation process intend to do so this year.

“The Peruvian market is demonstrating significant dynamism, as 86% of companies have identified the appearance of new competitors in the market,” the study states.

ECUADOR

Ecuador is the country where the largest number of companies have created an area or defined a leadership position specifically focused on digital transformation.

In 2021, 39% of companies undertook a digital transformation, with that number climbing to 58% in 2022 and 73% in 2023.

In addition, the proportion of companies achieving advanced or disruptive digital maturity reached 40%.

Some 64% of companies that were unable to start their digital transformation said a lack of strategic vision was the cause, while 67% considered that their staff lacked training.

However, 82% of companies that have not yet started a transformation intend to do so this year. “Digital transformation is positioned as a key strategic priority, enabling companies to face future challenges and capitalize on emerging opportunities,” the study adds.

COLOMBIA AND ARGENTINA

The proportion of Colombian companies that have not started a digital transformation declined from 81% in 2022 to 69% in 2023, while in Argentina those figures were 74% and 67%, respectively.

Colombian companies are also among the least digitized, as 59% consider their maturity only to be initial to intermediate.

Some 50% of the companies surveyed in that country also said that their digital transformation was hindered by low investments, while in Argentina, the main issue highlighted was a lack of digital skills.

“In Argentina, digital transformation is acting as a catalyst for new job opportunities,” the report reads. “With more than half of companies actively demanding new talent as an integral part of their transformation processes, a growth horizon driven by the incorporation of specialized digital skills is revealed,” it adds.

Some 71% of Colombian firms and 77% of Argentine companies plan to start a digital transformation this year.