In 1997, the Mexican technology company Softtek signed a contract with a marketing firm to evaluate the viability of exporting its services to the United States. “It cost $300,000 that we didn’t have,” recalled Blanca Treviño, the company’s CEO. The outcome of the research clearly showed that the project wasn’t worth pursuing. Despite this conclusion, she stuck with her plan of conquering the biggest and most sophisticated IT market in the world. “Thanks for your study, but I’m going to disregard it,” she told the consultants.
That’s the way Blanca Treviño is. Her energy seeps into all corners of her conversation. Maybe that’s why the Softtek decision was not only to enter the United States, but also to serve its 100 largest companies. “In 1997, I said I was going for the big market where only the giants play.”
That’s why she looked for a way to differentiate. Her offer at the time was to provide IT services from a nearby location: they called it nearshoring. “It has the same advantages of price and talent as offshoring, but with the extra benefit of being nearby: the time zones and compatibility.” Nearshoring is a word that gets a lot of use in the business world, but it was a trademark that Softtek invented and registered, Treviño said.
There were still skeptics. Softtek was dominant in Mexico, but had barely a marginal presence in South America. “They told me, you’re going to compete against a country and against companies ten times bigger,” she said. In fact, to compete against companies from India was to compete against the country that had converted support for IT companies into a national purpose. That’s why they didn’t pay taxes and were able to enjoy a clear leadership in pricing.
The company couldn’t hope to match costs with India and knew that being close wasn’t a big enough advantage. Then they sweetened their offer with a proposal of more efficient and productive processes.
It was in New York at GE, one of the most mature companies in contracting this type of services, where they made this aggressive business proposal. They promised to improve their efficiency every year and to share the profitability they produced with GE. “GE is a demanding customer. There was no rest. They told us: I’m going to open the doors, but you had better be on your toes. The Latin market is more tolerant,” she said.
She thinks that, more important than having gained the account, the most valuable thing was that Softtek was confronted with very high expectations and demands. “You’re forced to be better every day.” She believes that many Latin American companies offer ways of working that are convenient and simple for them. “They haven’t done a good job,” she said. “They don’t offer anything to differentiate themselves other than cost. They don’t understand that it is an extremely demanding market, that they can’t make the same offer as the one they make in their local markets.” She emphasized that no Latin American company has distinguished itself in this country.
As a result of her efforts, today Softtek does business in 30 countries, including China and Brazil – which is a larger operation than the one in Mexico – but her proudest achievement is still the office in the United States where Softtek competes against the best in the world. There, her clients consist of 50 of America’s largest companies. More than 80 percent of her customers have been with Softtek for at least 10 years. “The good financial results are the payoff for what we have done,” she said.
The future of Softtek appears more secure now. Treviño predicts changes in the perceptions of businessmen and governments. She believes that more of them understand that access to broadband is a right because it democratizes access of citizens to education and health. Also, there is more government support for technology exporting companies.
There will still be new difficulties, but it’s a near certainty that Treviño will manage them. One can almost say that if challenges don’t arise, she will find them, because as she says, she needs challenges to maintain the high levels of adrenalin. “If you like challenges, you’re going to create them and you’ll work in an environment that has them,” she said. This ensures that the future of the largest Mexican IT services company will continue to be interesting and an attractive example to others, and for those who follow Softtek’s development, it will always be surprising.
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