Digital transformation is a little understood buzzword for most Latin American companies. It is time for them to react or they risk being left behind.
Digging deep under the surface of the Earth, mining companies could be excused for thinking they will come out unscathed in the digital revolution transforming global business. Angel Izurieta has encountered this mode of thinking among industry executives. "We get rocks from the mountains, transform them, load it on a ship and send it to Asian markets," is their line, says Izurieta, managing director for natural resources for Accenture in Chile.
No matter their industry, companies that think like that are locking themselves out of an opportunity to transform their business. "There is little awareness among them," says Izurieta. "Some companies do not feel threatened (by digital disruption) because they are not operating in the digital realm."
By this point, it should be clear that digital transformation is more than a buzzword or a tech trend. It is a phenomenon that is ready to revolutionize all fields of business--and firms need to understand it as a sea change in culture and operations that can help them expand their business and rethink their processes from the ground up.
A foreign mining concern extracting Chilean copper embraced this endeavor, Izurieta says. Company executives used the transformation process to add value to their existing operations and to discover new fixes to old problems. One of the outcomes was that they managed to increase sales thanks to a new system that allowed them to detect metals other than copper in the ore they had already extracted.
That boost in revenues was brought within reach by a new software platform the company installed. It collected 700 different data points from hardware and software sources placed along segments of the mining process, from dynamite detonations at one end to administrators' desks at the other. Using the technology known as 'Internet of Things,' which brings cloud-connected sensors to an increasing number of machines and devices, the firm was able to make decisions it did not know were possible before.
"Digital transformation," Izurieta says, "has to be approached from the point of view of what business outcome it will deliver."
The business world is filled with big words that are ultimately devoid of meaning, and 'digital transformation' has been one of the most overused buzzwords in recent times. It can mean...