|Latin America 2009
|Staying competitive in today’s economy
|Mary E. Livingston
|Vice President, Canada, Caribbean and Latin America
Mary Livingston is the Vice President of AT&T’s global sales team in the Canada, Caribbean and Latin America (CCLA) region. Ms Livingston has held various leadership positions in sales and sales support; most recently, as Vice President of Sales Operations for Enterprise Business Sales. Ms Livingston spent half of her tenure with AT&T as a Region Vice President in the Premier Client Group. Ms Livingston also served as a national account manager, a branch manager, and ran AT&T’s international and private line center and was a key member of the digital services product team. Ms Livingston was highlighted in Katzenbach’s book on Real Change Leaders, and NJBiz magazine named her one of New Jersey’s 50 Best Business Women for 2008. Ms Livingston is on the Summit Area YMCA Board of Trustees, President’s Circle for NJ All Stars/Developmental School for Youth, the Greater NY Explorers Leadership Council, and is an active member of the International Women’s Forum. She is also the founder of Team 101. Mary Livingston received her MBA from the University of Missouri.
As companies prepare to recover from the recession, ROI is critical and IT executives are pressured to deliver in half the time. Cost cutting, productivity and revenue building are top priorities; the timelines for long-term planning have shrunk until there is little distinction between short-term and long-term strategies. Business continuity and security solutions are most sought, closely followed by enterprise mobility and Web delivery solutions. Third party managed services can provide IT services and solutions that rapidly deliver cost-savings and efficiencies.
Recovering from the global economic slowdown is a challenge that all multinational companies face today, but it is equally important to build a solid business strategy, particularly in light of the fact that an extraordinarily competitive landscape is expected to follow the current harsh business environment. IT’s contribution to an organization’s bottom line has pressed CIOs to evaluate their businesses’ core processes and applications to look for value-driven strategies that deliver lower operating costs, faster returns on their investments and better overall results. Having a presence in Latin America and the Caribbean has become increasingly important for organizations that want to take advantage of the opportunity that the recovery from the current global economic crisis will offer. Leveraging advanced technologies – from the core network connectivity to unified communications and managed networks, applications and systems – will provide enterprises with the competitive edge they need to efficiently overcome the current economic challenges, while maintaining the requisite capacity to address new opportunities. Cost-efficient collaboration As we have seen with many of our customers, the current economic scenario in Latin America and the Caribbean is driving the deployment of cost-efficient technologies that facilitate remote collaboration, increase business productivity and minimize travel costs – all of which have quickly become top IT priorities for multinational companies. The advancements in technology, broadband access and video quality, among other elements, foster the development of innovative solutions, such as telepresence, allowing businesses to interact and providing an ‘in-person’ experience by connecting people in multiple locations around the world. Whether closing potential deals, up-selling or cross-selling to current customers, training and developing employees or recruiting the best talent in multiple countries, collaboration solutions allow companies with operations in Latin America to speed up their time-to-market and business transactions and streamline decision-making. The Road to Growth Companies are now preparing for economic recovery in the first half of 2010. An important recent study, ‘The Road to Growth’, found that with recession ROI is more critical than ever before, and IT executives under pressure to deliver in half the time. The 2009 Road to Growth Study is based on interviews with a total of 77 IT executives employed with multinational companies with an approximate annual revenue of at least US$1 billion, including 47 U.S.-based IT executives and 30 European-based IT executives. All participants have responsibility for making decisions about IT strategy and budget allocations (CIO, CTO, or person who reports directly to the CIO/CTO). All US-based IT executives work for a US company or a US subsidiary of a foreign company based in the US. Overall, the US IT executives interviewed worked for multinational companies represented by 25 industries with median 2008 revenues of US$4.75 billion dollars and operations in an average of 28 countries (range, 2 to 122 countries). The Europe-based IT executives worked for multinational companies represented by 21 industries with average 2008 revenues of US$1.7 billion dollars and operations in an average of 20 countries (range, 3 to 60 countries). The interviews were conducted between April 16 and June 19, 2009. Key findings of ‘The Road to Growth’ The time horizon to achieve ROI narrowed by 50 per cent – In today’s economic climate, US companies have significantly shortened the time frame over which return on investment (ROI) is delivered. More than half of US IT executives interviewed stated they are under pressure to deliver a return on investment in half or less than half the time. As a result, two-thirds cited that the change has affected their IT budgets, strategies and priorities. The study found that companies are less willing to invest in longer-term projects or projects where the return does not come quickly. One CIO stated that the added pressure has forced the company to focus on IT projects that give at least 100 per cent ROI in 12 months; otherwise, the projects are dropped. Cost cutting and improving productivity are top priorities – cost cutting and increasing revenue remain the two primary business goals cited by companies. To achieve the goals, survive the recession and move towards growth, IT strategies are focused on: • reducing operating costs – 87 per cent cited “reducing operating costs” as “extremely or very important”; • improve collaboration with customer and partners – 85 per cent cited “improved collaboration with customers and partners” as “extremely or very important”; and • enhancing workforce performance and productivity – 83 per cent cited “enhancing workforce performance” as “extremely or very important”. Short and long term strategies are similar – The Road to Growth study found that US companies employ multiple strategies to address business goals, and do not distinguish between short-term and long-term strategies. It appears that US companies are reducing the period for their long-term forecasting until after the recession is over. The role IT plays in helping US companies achieve long-term strategies is very similar to the role IT plays in supporting the companies’ short-term business strategies. Business continuity and security solutions have the highest positive impact – IT investments and priorities will go towards lowering cost, reducing risks and improving productivity and efficiency. The study found that “business continuity and security solutions” will have the biggest positive impact on business growth as US companies prepare for an economic turnaround. This is closely followed by “enterprise mobility solutions” and “Web delivery solutions”. Areas of IT investment that are expected to have a high to moderate impact on businesses are “unified communications services” and “hosted solutions.” Managed services Given this business environment, the decision-making for IT systems driven by shrinking budgets has motivated businesses to increasingly look for ways to maximize their capability and extend the power of their investment. In Latin America, many companies have already completed, or are in the process of completing, the convergence of their networks into an IP-based network to leverage state-of-the-art technologies. As a natural next step, enterprises are now focusing their efforts to ensure they have the core applications to help them be more efficient and successful, such as those applications that run their businesses, content distribution, collaboration and security, among others. As business applications become more pervasive, companies are challenged to maintain the technical expertise and best-in-class technology required to deliver on user expectations. This is leading businesses to consider an outsourced approach to hosting and applications, thereby supplementing their in-house staff and infrastructure with third parties’ resources and expertise. Moving to a managed service model can lower costs by reducing or eliminating capital expenses, as well as by reducing operating costs related to facilities, management and labour. Managed service models allow companies to provision new services into Latin America and the Caribbean more quickly, which helps their customers keep pace with the rapid technological change, especially in this region where the industry tends to leap frog on new technology deployments. As multinational enterprises continue to deploy a centralized, cost-effective approach to their networks, systems and applications, connecting Latin America and Caribbean markets into their global map will continue to play an important role in their overall business growth. To address tighter IT spend, telecom service providers are now offering an on-demand, utility computing model for managed services. The best example of this is synaptic hosting. Synaptic hosting is a turnkey platform with a pay-per-use infrastructure that can be customized to adapt to changing demands from users or applications. It fundamentally changes the way organizations manage IT operations by delivering network, computing and storage capabilities in a complete package on an as-needed, pay-per-use basis. In sum, the key for an organization to staying competitive in the current business environment, from my perspective, is through leveraging IT services and solutions that deliver cost-savings and greater efficiencies in three major areas: their core network connectivity, managed solutions and collaboration services.