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The revolution of the Internet of Things, a world to discover

The business fabric in Latin America is strongly made up of traditional companies, but how to turn this reality around?

This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process. Opinions expressed by Entrepreneur contributors are their own.

By Gustavo Orjuela, Head of Venture Partnerships Colombia & México

Innovation and new technologies have taken on a very important role in companies and businesses in the last year, digital services are transcendental to avoid a greater paralysis of economies. The restrictions on mobility due to the COVID-19 pandemic have been an important impulse in the transformation of companies, they advanced in months what would have taken them years, the new conditions encouraged CEOs and leaders to make decisions on strategic projects that were on their agendas. However, can we speak of a true penetration of new technologies in the market? Are the efforts made to generate open innovation by companies enough?

According to the figures from the report "The opportunities of digitization in Latin America in the face of Covid-19" by ECLAC, the development of the digital ecosystem has an intermediate level compared to other regions of the world, with an index of 49,925 (on a scale from 0 to 100), the region is in a more advanced position compared to Africa (35.05), showing a significant lag with Western Europe (71.06) and North America (80.85).

The business fabric in Latin America is strongly constituted by traditional companies, exploiting common economic sectors and under obsolete management lines, these characteristics cause less competitiveness and give way in the global economic scenario, but how to turn this reality around? How to develop a new generation of more innovative and competitive companies?

Part of the answer is related to STEM skills (Science, Technology, Engineering and Mathematics) , more entrepreneurs are needed with the ability to understand the technological world, with the ambition to compete in it and with the lever of innovation as a way of manage. The companies that adopt in their DNA the use of technologies to transform not only their operation but also revalue their business model, are those destined to scale in a highly random and competitive world.

A trigger in the world for this technological adoption, due to its applicability, relevance and omnipresence has been the Internet of Things (IoT), which Oracle defines as “the network of physical objects (things) that carry integrated sensors, software and other technologies in order to connect and exchange data with other devices and systems through the Internet ”, it is expected by 2025 about 22,000 million connected devices.

Having the possibility of connecting objects to each other opens a valuable exploration space for companies when moving from analogous and empirical processes, to understanding the operation of their company in real time through data, with benefits in increasing productivity and waste minimization. Today we can see solutions developed in all kinds of sectors such as agriculture, health, retail, education, among others; with a total revenue potential for the region in 2023 of $ 33 billion according to GSMA Intelligence .

Startups such as digital spaces , are leading the development of IoT solutions for different economic sectors. These entrepreneurs, through their smart locker solution in the retail sector, have driven more than 60% growth in their customers' sales, reduced service time 20 times and managed to reduce logistics costs by 46%.

To get more entrepreneurs and companies to enter the world of the Internet of Things, Wayra Hispam and Telefónica Movistar were pioneers in launching IoT laboratories, where tests can be carried out on LPWA networks, in a node enabled in NB-IoT and LTE-M , providing a real end-to-end environment for new technologies, in a controlled environment, where you can experiment with applications and devices in real network conditions, allowing to reduce implementation costs.

Thanks to this type of initiative, an inclusive community is being generated, to share good practices and training spaces with allies, shorten information gaps and use of IoT in companies. The key is to bring together all the agents of the ecosystem to generate, collaborate, test and co-create solutions.