A wave of innovation is sweeping Latin America. Not just from start-ups and venture-backed businesses but also through the transformations that businesses are undergoing as they seek to adapt to the pandemic.
An executive of digital innovation at a strategy consultancy operating across Latin America commented, “There have not been more startups than usual created during the pandemic. The main source of innovation has come from small businesses that are agile enough to transform. For example, the LGBT club that became a supermarket within the first few weeks of the first lockdown. The companies that have survived are the ones that adapted quickly.”
“There have not been more startups than usual created during the pandemic. The main source of innovation has come from small businesses that are agile enough to transform.”
Executive, strategy consultancy, Peru
A digital transformation executive at a partner of Google in Colombia believes that government could have done more to promote innovation, “The Government has had some initiatives to promote innovative companies in the country, for example, all those companies that base their business on innovation and are a SAS (Simplified Stock Company) are exempt for 7 years from paying certain taxes. However, apart from this and certain funds created several years ago to invest in companies that have technology as a platform (such as Innpulsa), there are no other government initiatives.”
The pandemic has obviously resulted in a boom in digital adoption, for example in relation to remote working, third-party engagement tools and user identification processes, but not necessarily in innovation. The digital transformation executive explained, “Many companies in Latin America were not capable or did not have the real will to make an innovative transformation of their processes and business models.”
“Many companies in Latin America were not capable or did not have the real will to make an innovative transformation of their processes and business models.”
Digital transformation executive, Colombia
What we are seeing now is that some companies have been forced to use digital technologies but now these tools are embedded in their workflows. The digital transformation executive agreed, “What happens is that companies start with the essentials but then they realise the advantages (for example, they have more structured and systematised information that allows them to improve their service or develop new products) and begin to walk the path of innovation.”
Some of these digital trends seem irreversible but as vaccination programmes begin and the world dares to dream about a return to normal, will they persist?