What Are the Opportunities in Brazil?

While SAP achieved exceptional growth in Q3 for its software business throughout the Americas, in Brazil the best may be yet to come. Already cited as instrumental to the company’s outstanding performance in the last quarter, the Brazilian market may be a source of untapped potential for future growth in software sales. The possibility has not gone unnoticed at SAP, which projects its growth for the LATAM & Caribbean region at 30% year-over-year, with Brazil taking a leading role in that success.

But how will SAP meet these seriously ambitious goals?

In July SAP announced its plans for a 20 million euro expansion of its facilities in São Leopoldo, the company’s regional hub and development center. Also, SAP is investing heavily into its ecosystem throughout the LATAM & Caribbean region by assembling new teams to work with partners on channel specialization and co-innovation of new products. SAP Partner Service Delivery (PSD) plays a major role in this strategy by engaging with partners on an individual basis to make sure they have the tools and resources, including access to the right experts, to deliver valuable new products and services to the market. “There are major opportunities in Brazil available right now through partner specialization,” says Carlos Bento, SAP PSD regional head for Latin America and the Caribbean. “In PSD, we are ready to fully support partners as they grow their SAP business through our organizational structure, our understanding of the partner’s business focus, and our new service portfolio. Specializing in innovation is the way forward in Brazil and Latin America.”

In an interview with SAP.info, Valdinei Santana, director of organizational development at Pelissari, shares an SAP partner perspective on what Brazil’s IT market looks like heading into 2013. To learn more about Pelissari, read “Brazilian Perspectives” on SAP Business Trends.

What types of customers are buying SAP solutions?

All sorts. In Brazil, there are small-sized enterprises that are buying SAP Business One Solutions. Mid-sized enterprises with accelerated growth that are buying SAP Business-All-in-One to support their business processes. Large enterprises that already have a consolidated digital platform and wish to innovate business processes are complementing their solutions with mobility, cloud, and analytics applications to create intelligence using Big Data. Companies with greater maturity are using SAP as a base, adding innovative pieces to this platform.

What is the outlook for IT investments resulting from preparation for the 2014 World Cup and 2016 Olympic Games?

The biggest obstacle to business growth in Brazil is a weak infrastructure. It is a huge country, but few transportation alternatives have been explored. Many roads are overloaded and the ports are inefficient. The airports are too small to handle the volume of travelers during the Olympics and World Cup. There are IT opportunities accompanying these business opportunities, but an infrastructure that supports growth is needed.

Next page: What are the hottest sectors in the Brazilian market today?

Valdinei Santana, director of organizational development at Pelissari (Photo: private)

What is happening in the hottest sectors?

Brazil is considered a country of the future, and the future has arrived! There are great opportunities for deep-water drilling for oil, and satellite companies around the Petrobras need to prepare for the challenges that accompany this activity. We cannot however add value to these commodities yet, so we are still exporting many raw materials. There are opportunities to improve the efficiency and productivity of exploration and generate new business to add more value to Brazilian products.

Interest rates are down in Brazil and credit extended to consumers is on the rise. The Brazilian middle class is growing, bringing with it the potential for increased consumption. The future has arrived and we need to make the most of the moment.

What are the regional trends for SAP projects and customer needs? What are customers buying?

The IT market has changed over the past few decades. In the 1980s, managers who needed to improve information systems looked to the IT market but often could not find a solution. When they did find one, it was very expensive and few could afford it. The 1990s were the best time to sell information technology. When a manager had a problem and sought a solution, he found it in the market. It was very expensive but he had options and found one that fit his budget.

After the Y2K bug, the situation changed completely. There were many vendors knocking on the doors of businesses saying: “I have the solution to your problems!”  How could they have the solution if they haven’t yet discovered the problem? The focus has changed. Now we need to listen to customers and then solve their problems together. SAP is the world leader in this market. We can work with clients to co-innovate, but only after we understand the business problems, the pain points in the context of the competitive environment, and the challenges to be overcome in that industry.

What does Brazil’s rapid growth mean for the IT labor market? How is Pelissari affected?

Brazil is a developing country and has a very large shortage of skilled labor, especially in IT. To overcome this deficiency, Pelissari has hired professionals from top universities and invested in helping them attain additional qualifications. The universities have increased the number of qualified people, but there are still too few to perform highly complex services like engineering and other professional services such as IT. The IT market in Brazil has imported a lot of hardware and telecommunication equipment, but in terms of service, it is still very difficult, and companies need to invest heavily in additional training for their employees. That’s what we’ve done! During the next phase of our rapid growth, we need to harness the creativity of the Brazilian people and turn it into ideas for new and profitable products and services.