The 4 challenges that Argentina must overcome to conquer Industry 4.0

To really take advantage of digital transformation, as a country we have four major challenges to overcome:

1) Shortage of skilled labor

According to the Ministry of Productive Development of Argentina, one of the main restrictions that the sector has to continue growing is the availability of trained personnelespecially in the more complex task segments. There is a broad consensus, both in the public and private sectors, on the need to promote computer training. On the other hand, the lack of local supply of companies that provide specialized services in the maintenance of the 4.0 technological package can become a limitation for its implementation. But at the same time, companies can find a market niche in this area to progress.

In addition, Argentina presents relatively favorable conditions regarding its scientific subsystem, in the leading role of research institutions and with good performance in scientific publications. The Science and Technology ecosystem is a favorable asset to work in the dimensions of training, diagnosis, development and absorption of technologies. We have the tools to overcome the weaknesses caused by macroeconomic instability and the reduction of the financial system.

2) Connectivity

The second automation challenge is related to the connectivity and delays in terms of data infrastructure. A UNSAM investigation reveals that industries that develop automation processes and incorporate robotic machines maintain an integral connection throughout the production process. That is why they will have a great challenge in protecting this connectivity from attacks. These cyberattacks can occur for different reasons, since today they are not only intended to steal information, but there are also malwares specially designed to affect manufacturing processes. Therefore, investing in software and technologies with high security standards must be essential.

3) Cost of innovation

The third challenge to overcome is the high cost of innovation. It is a fact that innovating here costs more than in other countries. The Global Competitiveness Index 4.0 also illustratesArgentina’s performance in each of the pillars that make up the indicator. Among the challenges, there are macro factors, such as infrastructure and investment that hinder the necessary conditions for Argentina to be a facilitating platform for innovation; however, it should be noted that the main strength lies in human capital, in particular with regard to educational level, the quality of vocational training and general and digital skills that provide workers with considerable potential for skills and development. It is not in vain that Argentina is the second country with the most unicorns in Latin America. Could we be the first if more companies adopted the technology? How many of them are benefiting from competitive productivity?

4) Productive gap

The answer is in the huge productivity gap, Argentina’s fourth challenge, which the index also highlights and the CIPPEC survey confirms: about half of the 307 Argentine companies interviewed use first and second generation technologies and seem inactive in the face of technological change; the other 45% of the sample is characterized by the use of medium development technologies; and only 6% are close to the technological peak, although they are not quite 4.0. An important gap, and who stands out in the market is who takes advantage of this opportunity.

And now?

All this shows that there is still a long way to go to truly become a 4.0 country, but at the same time, it represents a wide range of possibilities to grow, invest, plan – and above all – learn to solve. The successful entrepreneur is distinguished by the ability to see opportunities in the midst of difficulties. Do not wait for the perfect conditions to transform your business, because there is no such scenario.

However, remember that by investing in technologies that facilitate the adaptation of your company to industry 4.0, you position yourself as competitive or even as a market leader.

So how can companies prepare for Industry 4.0? In practice, there is no single answer. But the essential first step can be defined as knowledge. It is necessary to know the subject, to study, to understand how each company and industry fit in the context of innovation, automation and data processing. It is up to the manager to look at his client, to understand how to reformulate his processes, so that there is no money wasted along the way.

The ideal is based on more basic technologies, such as integrated management systems, which unify business sectors and make structural analysis more transparent, agile and assertive. Industry 4.0 will gradually become a reality here, I believe in an Argentina that makes this movement even more present in the business routine, promoting optimizations never seen before.

Director of the South, North and Andean hubs of TOTVS.

Leave a Comment