Opportunities Missed? The "Vision Thing" in Latin America

I had the opportunity to speak with an executive for a major IT systems company headquartered in the USA recently about Latin America. It was a very professional and pleasant conversation, between two people who know the region, speak the major languages and understand how much progress the territory has experienced in the past few years (and decades). The result of our conversation? A bit of sadness, a bit of frustration and a lot of head-shaking as to "why?"

What caused these reactions? After all, this was a conversation about a well-established company that has major activities in the USA, Europe, Asia and other parts of the world. This is a leader in serving customers with sophisticated and complex technology services, and doing so with a great deal of excellence, commitment and long-term staying power. Well, the reality is that somehow, the company is nearly uninvolved in Latin America.

To be fair, the firm does have some projects in the region, and has bought into some existing operations in different parts of Latin America. Nonetheless, when a particular deal came along that would have opened up new capabilities, delivered a strong client portfolio and was to be had at an attractive price, involving two of the most vibrant economies in South America, the judgement was made by a CFO to "kill the deal". The reason? It was in Latin America, plain and simple.

While this discussion went on to other elements about why Latin America is such a strong regional opportunity for high-tech firms (and many others), it remained on my mind, causing just a bit of consternation. After some thought, it seemed apparent to this writer, that the company in question simply has a problem with the "vision thing" (to paraphrase a recent leader of the free world and a leader of a major computing company known by its initials). Latin America is just a "rounding error" in the total numbers generated by this particular IT company. It's not a vital piece of future business, nor is it an essential element in the strategic growth of the organization --- yet. Could that be ready for a change or will this reticence continue and multiple opportunities be missed?

Evidently, at present, they just don't seem to register the phenomenal growth, quarter-to-quarter going on in Brazil, the excellent economic security that has been re-established in Colombia, the strong growth in Peru, the stable, steady-eddy performance in Chile, and even the re-bound in Caribbean nations, and yes, Mexico, too has begun to recover from its dose of swine and economic flu in the past two years.

A key question then, is what is the "vision thing" and what does it take to make a business sit up and take notice of Latin America? Well that's perhaps a post for another time on this same blog, but suffice it to mention that based on my many years of experience in the region, there is a lot of business to be found, profits to be generated, and plenty of customers (and partners) who will commit deeply and for the long-term to your business just as soon as you show your seriousness, commitment, persistence and willingness to work with the "locals". It's a matter of seeing the forest and the trees, or perhaps better said, having "vision" and being willing to use it to see the brilliant future in doing business in Latin America.

Want to learn more about doing business in Latin America? Contact me: DCabrera@TopExec.org

Want to comment? Please do so on this same blog (below).

Thanks for reading.

(c) Daniel A. Cabrera, TopExec.org, All rights reserved, 2010.

Food Shortages in Venezuela

This post was originally drafted in October, 2009.


My travels haven’t taken me to Venezuela in a number of years, yet I remain involved in business activities that include this Andean nation. Recently I was able to spend some time in California and Colombia with folks from that country, and from its neighbor, Colombia. Naturally, our focus was on doing business, dealing with barriers created by the Chavez government in Venezuela, and building our ability to service those sectors still semi-functional in that country.
Anecdotally, here are some of the issues and problems that, while well documented in the press, simply amaze me, and generate simple questions, like “why”?

Thirty eggs today cost about US$3.50 in Colombia. In Venezuela, if you can get them, those same 30 eggs will cost US$20.00. Why?! Supply (or lack thereof) and demand (plenty of).
Venezuelans who travel abroad and buy food stuffs to carry home, (canned or dried goods, etc.) will be warned by the airlines prior to flying from the USA to return to Venezuela to reduce or eliminate the types and amounts of food they are carrying, as the authorities will confiscate them. Why?! People are hungry and Venezuela cannot produce enough for its population today.

Businesses that do legitimate transactions and obey all the protocols and regulations, in order to win and complete their contracts can find at the last minute, the Venezuelan government will “award” these contracts to investor nations, such as China, in the ultimate quid pro quo for hard currency investments from Sovereign Investment funds, which Venezuela seeks for political reasons, mostly. Even huge multinationals with decades of experience and commitment to doing business in Venezuela are left out to dry in these kinds of situations. Why?! Could it be politics?
Employees of major multinational firms in the computer industry are leaving the employ of these firms, when their requests to be transferred out of Venezuela are not forthcoming. No need to ask why, under the circumstances.

Not to beat a dead horse, but it’s clear that Venezuela, for all its heralded oil wealth is simply unable or unwilling to produce or import sufficient food for its own population. Further, in the words of a Colombian colleague, who has consistently and frequently traveled to Caracas over a thirty-year period, the situation has gone from bad to worse to far worse in the past several years. He refers to all aspects of the city and its environs, as well as crime rates, water and electricity shortages, and so forth. When it comes to doing business, what used to be a “process” to repatriate US dollars from the Bolivars earned locally, has now become an impossibility. You may be a millionaire in Bolivars, but you cannot pay your bills to vendors/partners/suppliers who request hard currency (US dollar, Euro, etc.) payment. Only those willing to ship dollars in suitcases surreptitiously can get their bills paid, it seems in today’s Venezuela.

As one who has specialized in Latin American business for nearly 30 years, this is a sad reality, and one that surely will have to change some day, if the Venezuelans who seek a better country have any hope for the prosperity and productivity that exists today in neighboring Colombia. Why?! I suppose that politics trumps common sense and supply and demand economics. Go figure.

Thanks for reading.

©Daniel A. Cabrera, TopExec.org, All rights reserved, 2010.

Colombia Leads in Competitivity – Notes from Andicom 2009

The world stage is always a good place to stand, if you want to be measured, analyzed or compared. In this regard, I found out a lot about Colombia at an event called Andicom 2009, held recently in Cartagena, Colombia.

This event has been held in Colombia for nearly 30 years, and it brings together telecommunications companies, government organizations, TV broadcasters and any number of other players, including more Internet Service Providers, infrastructure firms and others competing for space in the “spectrum” wars that affect all parts of Latin America and the world. At this year’s event, there were 2600 attendees, 160 media representatives and a wide variety of vendors/participants representing more than 26 countries, including France, the honorary “partner” host in this event.

As such, this particular forum is a good one to take measure of what’s happening in the Andean Region. Dr. Alvaro Uribe Vélez, the current president of Colombia, provided some of the highlights in Colombia, in his closing ceremony speech, October 30, 2009:

• World Bank research shows Colombia has moved to 37th in the world in competitivity, from a former position of 160th in the world.
• 
  Colombia has leaped past other big Latin American economies in this ranking, now surpassing Brazil, Mexico and Chile.
• 
  Colombia graduates today thousands of students in M.A. and Ph.D. programs, “on shore” as opposed to “off shore”
• 
  Colombia generates many other thousands of students earning technical or trade program degrees, through various governmental and educational organizations.
• 
  Colombia has a master plan for taking its Internet hubs from one, centralized connection (from Bogota) to a hub and spoke system that serves all major cities and their surrounding cities and towns. A project to lay fiber optic cable under the sea to connect its island provinces of San Andres and Providencia, is starting now.
• 
  New spectrums are being opened up for television, IPTV, government/security usage and private industry, based on both the country’s ongoing commitment to public safety and security (in the fights against terrorism, guerrilla violence and narco-trafficers), as well as its commitment to improving the country’s productivity and future prosperity.

While this list is not all-inclusive of the remarks made by Dr. Uribe, or other speakers at Andicom’s closing ceremony, it is a sample of the vision and the future of this Andean country, which today has a population of approximately 46 million, and a widely-diversified economy, one of the leaders in Latin America. At the same time, Dr. Uribe insisted that the world should continue to bring direct financial investment to the country, as this flow of capital, ideas and collaboration by countries, companies and individuals is a vital part of Colombia’s continued growth and drive to expand prosperity to all parts of its population. A key element of his remarks was the drive to provide social impact to all economic strata within the country through telecommunications, Internet and other “tele-services”. These services today facilitate programs and productivity in education, medicine, agriculture and many other parts of the economy.

Finally, one overriding note from Dr. Uribe’s comments was that of security and public safety. Clearly, this is underscored by the greatly-improved security situation throughout Colombia, which has worked diligently to reduce the spaces and places where the FARC and other guerrilla/narco-terrorist organizations can harm citizens and their means of earning a living.

In light of my current employer, SonicWALL’s network security expertise, and the confluence of voice/data/video and other information flowing over IP networks, such as the Internet, private PBX networks, VoIP connections, etc., it is of particular interest to note how much the current prosperity and productivity that Colombia is enjoying is a direct result of the improved security mechanisms and commitments that the Colombian government is successfully employing throughout the nation.

It makes me think that if ever companies and customers were interested in securing their own networks and VoIP transactions, and such, they would be wise to make sure that security and protective measures for all elements of their network infrastructure were in place and kept constantly up to date. Clearly, the threats that have consumed Colombian society for forty years, when reduced and isolated, as has happened during Uribe’s administration, are parallels to the damage and risk that happen to computer networks when left under- or unprotected. Security on the network is a key to productivity, just as security in a nation like Colombia is vital to productivity and prosperity and, yes, competitivity.

In sum, Andicom 2009, in Colombia last week (Oct.28-30, 2009) was an experience that underscores the vibrancy of both the Andean region and Colombia in particular, as well as the ongoing technology trends that drive productivity and prosperity in this part of the world. Let’s hope that such positive trends continue for all concerned.

© Daniel A. Cabrera, TopExec.org, All rights reserved, 2009.

To read this posting in Spanish or Portuguese, please look on these blogs:

http://sonicwallblog.blogspot.com/ (Spanish)

http://sonicwallbrasil.blogspot.com/ (Portuguese)