In a frantic technological context (led by Artificial Intelligence), where Latin American companies struggle to adapt to an increasingly digital global market, the need to optimize processes and improve operational efficiency is greater than ever. However, the region still faces significant barriers related to technological infrastructure and access to advanced resources.
In this context, data-driven digital transformation emerges as a clear path for companies to adapt and thrive. Using advanced analytics to convert large volumes of data into actionable information offers a strategic approach to identify opportunities for improvement and generate sustainable growth.
Technology lag and regional challenges
Despite growth in investment in emerging technologies in some sectors, much of Latin America continues to lag behind other regions of the world such as Europe, Asia, and North America, with the main barrier being a shortage of specialized talent in critical areas such as engineering and data science.
However, traditional approaches to addressing these challenges – such as simply upgrading infrastructure or adopting off-the-shelf solutions – often prove ineffective in the long run due to a lack of capacity needed to stay on the cutting edge of technology. In contrast, companies that embrace a digital transformation focused on their data strategy and advanced analytics processes succeed in creating a robust foundation to leverage new and better solutions in the future.
The role of data in digital transformation
When we talk about data-driven digital transformation, it's not just about making the most of the data you already have, it's about changing the mindset for all business processes and the data they generate.
Through a rigorous process of defining data governance, companies must first generate their business data. This, then allows them to use it to improve decision-making, optimize their resources, and anticipate market trends.
For example, advanced analytics allows food companies to identify inefficiencies in their production lines and adjust processes in real time to reduce operating costs. But this would not be possible without real-time data infrastructure, which requires specific sensors, cloud services to store them, and processing clusters to generate the insights at the moment they need to be actioned.
Identifying opportunities through advanced analytics
The first step in harnessing the power of data is identifying the key drivers that influence business performance. These drivers provide detailed insight into how different areas of the business interact with each other and how to optimize each of them. By defining the data strategy considering these interdependencies, organizations can identify information gaps, performance, and opportunities for improvement. When this is not taken into consideration, the main visible symptom is duplicated and inconsistent information within the company.
An analysis based on unified data allows costs to be broken down by production unit, transaction, or any other relevant indicator across the entire production process. This provides a deeper understanding of operations and reveals pockets of inefficiency that would otherwise remain hidden.
Strategies for capturing the value of data
Once opportunities have been identified, it is essential to develop customized implementation strategies. In Summa's experience, there is no one-size-fits-all solution that works for all companies; each organization needs to tailor its digital transformation strategies to its context and industry.
Identifying the areas where the greatest impact can be achieved and defining solutions for these priority areas should be the basis of the strategy.
It is also important to remember that, beyond identifying opportunities, true digital transformation depends on the organization's ability to effectively execute the proposed strategies. Organizational culture and commitment to change play a fundamental role in this process.
Overcoming technological barriers in Latin America
The challenge does not end with identifying opportunities or designing strategies. Companies in Latin America must face the reality of their knowledge limitations, prioritizing recruitment aligned with growth ambitions.
At Summa, we have worked side-by-side with numerous regional companies that have seen the benefits of investing in advanced analytics capabilities and overcoming these obstacles. For example, one retail company we collaborated with was struggling with high operating costs and declining profit margins. Through in-depth analysis of their cost data, we identified critical areas for optimization, such as energy consumption and travel expenses. By implementing specific cost optimization solutions, we reduced these operating costs by 15%, improving the company's overall profitability.
Monitoring and continuous improvement
Implementing data-driven digital transformation strategies is not the end of the process-it's just the beginning. To ensure that improvements are sustainable over the long term, it is essential to establish continuous monitoring mechanisms. This involves defining key performance indicators (KPIs) that measure the impact of the strategies implemented and allow adjustments to be made within reasonable timeframes.
In our experience, continuous monitoring is essential to ensure that strategies are not only implemented correctly but also generate the expected results. This also helps prevent new inefficiencies from appearing over time, which is a common risk when adjustments to strategies are not made regularly.
Conclusion: Latin America's digital future is data-driven
Data-driven digital transformation represents a unique opportunity for Latin American companies to overcome technological barriers and increase their competitiveness in the global marketplace. Through a rigorous, analytical approach and the right professionals, organizations can identify and address inefficiencies that limit their growth, while customized strategies will capitalize on specific improvement opportunities.
At Summa, we are committed to accompanying companies in this process, helping them implement advanced data analytics solutions that will drive their digital transformation and enable them to achieve sustained long-term success.
Contact me and let's talk.
About the author
Jorge Salas, Phd is a Data Analytics Associate at SummaPartners and has extensive experience in data science consulting.