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Colombia’s Digital Transformation

In his debut book Malcolm Gladwell defines a tipping point as “the moment of critical mass, the threshold, the boiling point”. Colombia, which has experienced strong economic growth and reductions in poverty over the past decade, may have reached just such a digital ‘tipping point’.
As a paper published by Brookings Institution, the Washington-based think-tank, notes, “The government has also embarked on an ambitious plan to increase the uptake and use of digital technologies, expanding internet access, promoting the development of local online content, and emphasizing government use of the internet and data to improve service delivery, transparency, and governance.”
Peace accord helps lay foundation for change
The recently concluded peace agreement with the Revolutionary Armed Forces of Colombia (FARC) is another reason for optimism about Colombia’s economic and social prospects, says the Brookings paper which was published in October.
But challenges remain. The commodity boom that fueled large increases in Colombia’s exports is over and unlikely to return, leaving the Latin American nation with a commodity-weighted economy. Meanwhile income inequality remains one of the highest globally, and poverty is still widespread.
This makes Colombia’s embryonic IT-fueled digital transformation that much more urgent. “Trade in digitally deliver- able services—services that can be provided online already represent over 12 percent of Colombia’s total exports and this increases to over 17.5 percent once digital services embodied in goods exports are included,” say the Brookings paper’s authors.
“Businesses are also using the internet and data to provide digital services as part of more traditional goods offerings, thereby increasing their overall value. This includes using sensors and data analytics to trace agricultural products and improve the efficiency of mining and manufacturing operations.”
Coffee, Power and Retail
Among IT companies, SAP is playing a major role in enabling this digital transformation. For example, the company has partnered with the Federación de Cafeteros de Colombia on an innovative project designed to improve the lives of coffee farmers in Colombia, the fourth largest producer of coffee in the world. As a result, 5,000 coffee farmers will have mobile tablets in their hands, providing anywhere, anytime connectivity to information vital for better decision-making.
Similarly, Empresa de Energia de Bogota (EBB), a public utility company and the second electricity transmission corporation in Colombia, is using the SAP Digital Boardroom to better manage its operations and gain valuable insights.
Colombia-based Grupo Éxito, the largest retail company in South America, understands managing its procurement strategy is a key factor for success in the retail industry. So the company decided to invest in SAP Ariba solutions to digitize their supply chain and strengthen relationships with their providers. The unique integrated platform of SAP Ariba allows Grupo Exito to generate continuous growth and development opportunities and be more transparent and profitable.
SMBs set the pace
SAP is also helping small and medium-sized companies – the backbone of Colombia’s economy – become more efficient and deliver better services to their customers. For example, Dunkin Donuts Colombia uses Business One, the SAP star solution for SMEs, to improve its administrative, finance and sales processes.
In the public sector, the University of Los Andes, commonly self-styled as Uniandes, is considered to be one of the best universities in this region. Uniandes is using SAP SuccessFactors software to better manage its workforce and optimizing its supply chain operation with SAP Ariba.
(These and other examples of SAP’s expanding role in Colombia’s digital transformation will be highlighted in SAP’s Run Digital Tour and conference taking place this week in Bogota.)
Colombia, like other developing nations, has an opportunity to leapfrog the legacy systems that can hold back companies and other entities in more developed markets – and use digitization to help shape the future of this Latin American nation and change the lives of its nearly 50m residents.
As the Brookings paper said: “Deepening and broadening the capacity of government, business, and people to use these (digital) technologies will be a key determinant of economic prosperity. The pervasive impact of the internet and data on all economic sectors—industrial, manufacturing, agriculture, services, and government—underscores that building a digital Colombia can lay the foundation for more sustainable and inclusive growth going forward.”

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