Research Objectives and Methodology

Study Period: 2023

• Frost & Sullivan has conducted an annual survey involving decision-makers in information technology and business areas since 2010. 
• The survey aims to understand the perspectives, choices, and acquisition strategies of organizations concerning cloud technologies. 
• The findings provide valuable insights into the ever-evolving organizational priorities among respondents and assess the role of cloud technologies in achieving their business objectives. 
• This Frost & Sullivan survey covers the Latin American market. The data is derived from respondents operating in the 4 largest markets in the region: Brazil, Mexico, Argentina, and Colombia.

Key Findings

• The adoption of new technologies, such as cloud infrastructure, artificial intelligence (AI), and augmented reality, has emerged as a crucial driver for fostering innovation and growth in the Latin American business landscape.
• While the projected growth of regional economies for 2024 is sluggish, digital transformation is poised to perform well, albeit with growth rates for cloud that are lower than those registered during the pandemic and subsequent 2 years.
• Process automation, AI, machine learning, and cloud computing are the technologies topping the list of priorities for investments Latin American companies will make in the next 12 months
• The pursuit of leveraging these new technologies is leading companies to seek partnerships with external firms, with the primary goal of reducing operating costs. Partnerships provide access to skilled professionals at lower costs and are seen as an opportunity for profit improvement amid slow economic growth.
• Sustainability is also gaining relevance among the region's organizations. Heightened awareness of the environment and carbon footprint mitigation are prompting Latin American companies to adopt more sustainable practices. Mindful of their environmental responsibility, they opt for cloud services that promote energy efficiency and reduce emissions.

Enterprise Cloud Adoption in Latin America

Overview

• In recent decades, Latin America’s macroeconomic crises have led to significant political and economic instability, negatively impacting the development and adoption of new technologies in the subcontinent. However, past volatilities have given way to more robust economies and stronger democracies in most countries in this region in the past 5 years.
• The result is more dynamic economic growth and, consequently, greater adoption of new technologies by businesses. The region has emerged as a focal point for accelerated adoption and development of cloud infrastructure, automation, communication, and other technologies, outpacing the growth rates observed in more developed economies in certain areas.
• Latin American companies increasingly rely on technology to maintain a competitive position and continued expansion. While revenue growth and improving operational inefficiencies remain the top priorities for organizations, becoming a leader in social and sustainability practices, talent retention, quick response to market disruptions, and data centricism are factors gaining increased attention.
• Latin America is grappling with a deficiency in technology education, resulting in a shortage of skilled human capital. Several tech hyperscalers, including AWS and Oracle, have stepped in to bridge this gap by initiating educational programs to groom young professionals.
• The goal to adopt more environmentally friendly operations stems from a deeper social consciousness in the region regarding the importance of environmental responsibility and climate change. Latin America is home to the world's largest rainforest and substantial freshwater reserves. The fight against climate change and ecosystem preservation are increasingly prominent items in the governmental agendas of subcontinental countries.
• Data centrism is a priority, as in other parts of the world, due to the efficiency it brings companies as their operations expand. In a region traditionally dominated by small and medium-sized enterprises, the emergence of digital-native giants is more common. For example, Mercado Libre, an eCommerce giant born in Argentina with widespread operations throughout Latin America, is a dominant market player, surpassing Amazon.