Business Transformation in Mexico Is Happening Right Now

In my last blog post I looked at the Mexican appetite for large-scale business transformation and the five key considerations businesses should take into account when making the transition from industrial age (static, slow and immovable) to digital age (nimble, fast and innovative).

In this blog I’ll take a closer look at some of the companies leading this charge, all of whom I was lucky enough to meet on my recent trip to Mexico City, and examine some of challenges they are facing.

Big Data Analytics – Pulling Value and Insights from Data

One of Latin America’s largest service providers is sitting on a goldmine of data. It has a clear focus on driving real and measurable business value from analytics and exploring how to maximise the impact of this on customers and the business itself. The next key step is for it to figure out:

• What services?
• What insights?
• What can we charge and whom should we target?

Software-Defined Infrastructure at the Heart

Network function virtualisation (NFV) and software-defined networking (SDN) are central to this organisation’s strategy for change – a theme we are seeing accelerating in the service provider market segment. Broadly speaking NFV takes a previously fixed network function and allows you to run it on a virtual machine (VM), while SDN separates management from the fixed appliance and allows you to manage resources centrally from one location. Ultimately this move towards a more Software-defined Infrastructure (SDI) should significantly increase network agility whilst reducing cost – a key business outcome that is critical to this company’s transformation. It’s clear to me that it is keen to push forward with both NFV and SDN at high speed. If you’re after more detail on NFV and SDN then I’d strongly recommend you read this excellent blog from Jim Henrys. The organisation is also planning a large-scale private cloud, along the lines of our own OpenStack model here at Intel. The key consideration for it here is how to roll this out in an orderly and secure manner. Challenge of privatisation – how companies need to stay competitive and transform Government regulations are opening up the public sector in Mexico allowing for more competition and creating an opportunity for state-owned businesses to revisit how they stay ahead in markets that will be changing fast. One such organisation we met with knows it has to transform its business dramatically:

• Firstly, agility is high on the agenda as is diversification into communities
• Secondly, it also plans to further improve its customers centricity by driving further into people's home, adding to the one million smart devices it already has installed across the country.

Cultural Change Goes Hand-in-Hand with Technological Change

It recognises that technology will play a key role in this modernisation but it is also under no illusion as to the importance of cultural change in this process. It won’t be an easy mountain to climb, but it certainly isn’t an insurmountable one.

Energy giant E.ON started out as a state-owned organisation before making the transition to a privately-owned company in the 1980s. Over more recent years it has transformed itself from a traditional utility to a modern, agile brand. It is now a key player in the digital home, offering a range of smart value-add services to attract and retain more customers in an increasingly competitive market segment.

Moving from Retail to Lifestyle Brand

One of Mexico’s most prestigious retail chains has already rolled out initiatives to drive customer stickiness and loyalty through tiered credit card programs and has ambitions to make the full transition from retailer to lifestyle brand.

Its vision is to create a full sensory customer experience, from physical stores to online, at every point in the omni-channel journey. It is very progressive and very exciting to see this level of innovation underway. The delivery of immersive, connected and safe experiences is a great way to win and retain customers – a key business outcome many enterprises are trying to achieve.

Inspirational, Emerging Lifestyle Brands

This organisation recognises that technology has to underpin this transformation and is fully bought into the SMAC stack model I discussed in my last blogpost. The full transition to lifestyle brand will not be easy, but there are companies it can look to for inspiration.

BMW no longer views itself as premium car manufacturer but rather as “a leading supplier of premium products and premium services for individual mobility”. It is re-imagining every aspect of its business - from how it designs and manufactures vehicles to how it engages with customers to better integrate products and services into our increasingly mobile lives. The car is only one small part of this.

How to Convince a Nation that Cards Are the Way Forward

Another company I met with has a goal to get its cards into the hands of the 60 million cardless Mexicans. Traditionally consumers and small businesses have been somewhat resistant to this. The opportunity lies in it being able to work out the best way to persuade this untapped audience that cards, rather than cash, are the way forward.

One example looks at getting cards into the 100,000 taxis operating in Mexico City. These drivers are currently facing stiff competition from Uber, which has taken the city by storm. Technology – and specifically the use of SMAC – is integral to this company’s business model, meaning its drivers are more traceable and customers are able to directly read other customer feedback. The organisation I met with will be looking to replicate this sort of success for its customers and partners.

From Traditional to Digital Business

Overall, my conversations with customers in Mexico City were fascinating. It became clear to me over the course of my trip that the train towards digital business has well and truly left the station in Mexico. Many of the customers I spoke with are now looking at how to remove the obstacles on the track that are preventing them from putting their foot fully on the accelerator. I believe this is an area where Intel can help a great deal.

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