Karen Bitran oversees IDC’s research practices in Latin America for software covering enterprise applications, analytics applications, infrastructure software and development, and integration tools. Prior to managing IDC’s software practices, Biltran analyzed software and services markets in Mexico and Brazil.
Through her detailed market and customer knowledge of both the software and IT services areas, Bitran is frequently asked to present at customer and industry events about the solutions market in Latin America and the evolving requirements of the leading data centers in Latin America for software and services solutions.
Profit asked Biltran about challenges specific to the manufacturing industry throughout Latin America.
Profit: How can small and medium manufacturers in Latin America better prepare themselves to compete globally?
Bitran: We see a lot of manufacturers going to Asia, including China, Korea, and Taiwan. If Latin American companies want to compete in this market, they have to be faster, they have to have better IT systems, and they have to be able to make decisions much faster than they are accustomed to. In Mexico, for example, small and medium businesses are beginning to consider adopting technology to help them react faster in the coming years.
Profit: What are some of the pressures that keep growth from moving at a more rapid pace?
Bitran: I’m definitely seeing accelerated groth in IT in Latin America among SMB’s; however, these companies don’t necessarily have the same kind of economies of scale or the same kind of power to negotiate high-volume purchases as large businesses do. And that is probably one of the main challenges SMB companies face nowadays.
Naturally small and medium businesses can be very cost-sensitive. It’s not uncommon for a company in a smaller town or city in Latin America to lack the U$S20,000 or U$S30,000 necessary to make an initial technology investment.
This is the first time that Latin America is actually going through a period of steady growth economy, which allows countries to further develop their SMB sector. Many times when we’ve tried to develop channels, we’ve had a crisis and then we have to stop that area of progress because the priorities change. The Argentine economy crisis for instance, had a devastating effect on the country’s economy during the early 2000’s. It has been a little more than two years than Argentina began recovering, and now the SMB sector is also starting to invest more strongly in IT.
Profit: Are there any cultural differences that make SMB’s in Latin America unique?
Bitran: One difference is that in Latin America there are a certain percentage of companies that have been family-owned and operated for one or more generations. Within a family-owned business, people are sometimes used to thinking that the way the business has worked up until now is clearly the way that it’s going to work in the future, , which is not necessarily true.
Sometimes they maintain a false belief that they can sidestep technology and still optimally grow their business.
Today, they’re changing their attitude but within a family business there may not always be somebody who has studied purchasing or manufacturing practices, so the person who makes the decisions might not necessarily be the best person for making forward-thinking decisions about technology.