Building innovation is one of those hot topics that yield all sorts of discussion about disruptive technology—the cloud, 3-D printing, social media, digital infrastructure, et cetera. But what spurs innovation may come down to something much more basic: talent. And at the World Economic Forum on Latin America (WEF LATAM) last week, it was clear that participants from this region agree.
Two sessions at WEF LATAM were completely devoted to the topic of talent and it came up often throughout the event, including during the session I participated in, “Innovating for Competiveness.” When the moderator asked a panelist, a minister for information technologies and communications from Colombia, what three areas he would invest in to build innovation in his country he answered: “Talent, talent, and talent.”
Talent, according to the World Bank, is one of the major challenges to building innovation-driven businesses in the region. There appears to be plenty of entrepreneurship, but of these, very few are innovation-driven—and that’s where the real quality of growth comes from.1
Many Latin American countries have improved in terms of education over the past decade. Their levels of investment into education and graduation rates are steadily improving.2 But as the President of Costa Rica said in one session on talent, the number of graduates is not so important as what students are graduating in. Are they graduating in engineering, the sciences, the all-important information communications technology fields? And are the institutions that educate students aligned with what job markets really demand? According to The Economist magazine, “Countries with the lowest youth jobless rates have a close relationship between education and work.”3
Talent as it relates to innovation also has an impact on competition. For those companies competing for limited talent resources in these markets, having an innovation edge is critical. That’s particularly true with millennials: eighty-nine percent of these in Latin America are strongly influenced by how innovative a company was when deciding if they wanted to work there, says Deloitte’s Millennial Survey. So it’s a virtuous cycle: the right talent creates innovative cultures within a company and, therefore, can attract more of the best talent.
Undoubtedly, when discussing how to build innovation, the conversation needs to be broad and deep. This is especially true when it comes to a region like Latin America that is only just embarking on innovation-driven growth. But talent is a good place to start—and it may be the only place.
1 Latin American Entrepreneurs: Many Firms but Little Innovation, World Bank Latin American and Caribbean Studies, 2014; 2 Is the Glass Half Empty or Half Full? School Enrollment, Graduation, and Dropout Rates in Latin America, Inter-American Development Bank, 2013; 3 “Youth unemployment: Generation jobless,” 27 April 2013, The Economist.
Gary Coleman is Managing Director, Global Industries, of Deloitte Touche Tohmatsu Limited. He is a member of Deloitte’s Global Markets Committee and is the lead partner in Deloitte’s strategic relationship with the World Economic Forum. Follow him on Twitter @gcoleman_gary.