The State of Digital Transformation in Argentina

Digital transformation is taking place in companies around the world, although in some countries progress is faster than in others. Today we are going to know in greater depth in what situation Argentina is: the current state of Argentine companies, the obstacles they face when carrying out this transformation and the solutions that are being considered.

Digital transformation is a process that, as indicated by the multinational specialized in business management SAP, “is no longer an option, but an essential driver of income, profits and growth.”

In this study, it was concluded that 84% of companies around the world consider digital transformation as “crucial”. However, only 3% have terminated this process within their organizations.

Each country has completely different circumstances, which condition the state of the digital transformation. Today we will focus on knowing where Argentina is located, for which we will first use the Dell Technologies index.

Argentina, a country with great potential and a long way to go

The Dell Technologies index considers a number of factors, such as the performance of companies, the implementation of digital strategies or the forecast of future investments. Thanks to this index, a classification can be made of the position in which the companies are in terms of digital transformation.

According to these results, only 2% of Argentine companies can be considered digital leaders. This means that the digital transformation has been completed and integrated in a complete and transversal way in all the departments of the companies that fall within this small percentage.

In the second position are the digital adopters, who represent 23%. These are in an advanced phase of the integration of digital tools, close to completing this process.

Where most of the Argentine companies are is in the group of digital evaluators (39%). These companies are aware of the importance of digital transformation and are gradually adapting, although with certain precautions.

The penultimate group, digital followers, is composed of 29% of companies. They are those that do not have large amounts of investment because they are still beginning to implement this process.

In the last place are the digital laggards, only 7% of the total of Argentine companies, which do not have any digital plan or their investment is very small.

The conclusion we draw with these data is that the bulk of Argentine companies are in a middle or low position in the table. This means that there is much still to be improved, and actions must be put in place as soon as possible so that the business does not become stagnant and loses competitiveness with respect to the other countries of Latin America.

Main obstacles for digital transformation in Argentina

The current state of the digital transformation in Argentina is due to a series of factors that hinder progress, so it is also important to know which are to solve them as soon as possible. 94% of the companies have stated that there are important obstacles when facing this process.

The main problems mentioned by the entrepreneurs in the study of Dell Technologies are the following:

  • Lack of digital culture (30%)
  • Over-saturation of information on digital transformation (28%)
  • Lack of support from executives (27%)
  • Regulatory or legislative changes (24%)

The other study conducted by Siemens Argentina in this regard generated another point of view regarding the obstacles encountered. The main internal barrier indicated by the respondents is the cost of making these changes, while, as a negative external factor, there is a lack of greater financial advantages for those who decide to take the step and better defined technical standards.

Even if these obstacles exist, at least there is a clear awareness of the importance of carrying out the digital transformation. 80% of CEOs consider this process “critical”, although only 43% have a department exclusively dedicated to digital innovation.

Solutions to overcome the challenges

Companies are looking for solutions to overcome these difficulties to continue progressing and not lose competitiveness in their market. These are the main methods that companies are following according to the joint research of Dell Technologies and Intel:

• Streamline the software development process so that the launch cycles of new applications are shorter.

• Invest more in the training of employees to perform their work more optimally, quickly and efficiently.

• Strengthen the security and privacy of devices and applications.

• Instruct workers in specialties not specific to their field (for example, that the sales team is also trained in information technology and that the IT team also has sales training).

Web developer working on the website

 The companies also plan to invest in the next three years in technologies that improve their daily activity and also in others that protect them and allow them to continue developing and growing. For this reason, 56% of businesses have declared their intention to bet on cybersecurity solutions. The remaining 44% of planned ICT investments is divided into the following:

  • 49%, internet of things (IoT).
  • 38%, artificial intelligence (AI).
  • 22%, Blockchain.
  • 20%, virtual reality and augmented reality (VR and AR).
  • 12%, quantum processing.

Guido Ipszman, General Manager of Dell EMC Argentina, Uruguay and Paraguay, highlights that “it is an exciting time for business” and that “only technology-focused organizations will reap the fruits of the digital business model.”

In short, Argentina is in a slightly delayed position in the digital transformation of companies, which leaves much room for improvement. Fortunately, thanks to the studies carried out in the country, we know perfectly well which are the obstacles that are impeding the progress and the solutions that will be carried out to achieve the necessary progress to achieve the full implementation.