2024 LATAM CPO Report

Executive Summary

The 2024 LATAM CPO Report highlights the current landscape of purchasing operations in Latin America amidst high market volatility due to global, regional, and local macroeconomic uncertainties. In 2023, leaders in purchasing identified strategic priorities including supply chain disruptions reduction, cost and risk management, inflation mitigation, and inventory management efficiency.

Key Findings:

• Amidst Economic Uncertainty: Companies in Latin America anticipate at least a minimum of 5% growth this year, with over 66% of firms expecting moderate to significant growth.
• Strategic Focus on Procurement: Despite procurement roles often being decentralized and focused on tactical activities, only 17% manage more than 80% of their activities strategically, indicating a need for increased strategic involvement.
• Digital Transformation: Over half of companies have embarked on digital transformation, but only 15% have completed implementation phases, highlighting challenges such as data immaturity, inadequate tool integration, lack of support equipment, and substandard database management.

Industry Landscape:

• The report involves professionals from leading companies across various industries, with a focus on Mexico and Brazil due to their status as major regional economies. Participants include Fortune 500 companies' executives and managers across diverse industries such as manufacturing, retail, food, and consumer goods.

Challenges and Priorities:

• Key challenges identified include volatile pricing due to macroeconomic uncertainty, budget constraints for procurement improvement, misalignment with other functional areas' priorities, and lack of awareness about the latest efficient solutions.
• Strategic priorities are categorized into short-term (1 year), medium-term (1-2 years), and long-term goals. Top priorities include supply chain resilience, technology implementation, operational efficiency enhancement, human capital improvement, and environmental and social responsibility.

Operational Maturity:

• The study reveals that companies are developing their purchasing functions, with a notable shift towards centralization. A significant portion manages between 61-80% of strategic purchases, indicating reactive strategies.
• Many companies aim to modernize their procurement models through technology adoption, driven by global technological advancements and the pandemic's impact.

Digital Transformation Roadblocks:

• Data quality is cited as one of the main obstacles hindering Latin American companies' progress towards digital transformation, alongside other challenges like inadequate data maturity, tool integration issues, lack of support equipment, and substandard database management.

This summary encapsulates the main insights from the 2024 LATAM CPO Report, emphasizing strategic priorities, operational challenges, industry participation, and key roadblocks to digital transformation in purchasing operations across Latin America.