Latin America: once again, a natural market for expansion

For many Spanish companies, internationalisation is a key turning point that is reached once a certain level of growth has been achieved. The current landscape has been changing in recent years, and the market now demands a more agile, more secure and, above all, highly specialised approach to carrying out this process.

A new cycle for Spanish management talent

When considering expansion into Latin America, it is essential to understand the current socio-political and economic climate in the region. In this regard, Patricio Gil Olmedo, Managing Partner at EPUNTO Interim Management, states that “many executives have resumed the role that Spanish companies historically played in Latin America. We have gone through a period in which our presence was somewhat maligned, but now, with the political and social changes taking place in many countries across the region, a great opportunity is opening up once again”.

For these reasons, Patricio emphasises that “now is the time for Spanish management and its outstanding executives to once again play a leading role in all the processes of change and modernisation that are set to take place in the near future in many Latin American countries”.

Spain’s renewed prominence in the region highlights an undeniable reality: Latin America is undergoing a profound transformation. Against this backdrop, the management experience, adaptability and proven expertise of Spanish executives are assets of immense value for leading modernisation projects in the various countries.

What strategic opportunities does Latin America offer?

The Latin American continent is not a homogeneous bloc, and any expansion strategy must identify where the real centres of opportunity for the services sector lie:

• Mexico: Driven by the phenomenon of nearshoring, the country has an urgent need for consultancy, tourism, engineering, logistics and technology services to support the relocation of North American industry.
• Colombia and Chile: As a result of recent political changes, both countries maintain and foster strong demand for financial, technology and renewable energy services; and require senior executives with experience in corporate transitions and digital modernisation.
• Peru and Brazil: These countries offer significant opportunities in the modernisation of infrastructure and operational management services, where the European model of project management and efficiency is highly valued.

Interim management as a catalyst for a soft landing

The greatest risk of any international expansion is the learning curve in the host country. A lack of understanding of the country’s culture, regulatory framework, local negotiation dynamics or corporate idiosyncrasies can hamper the first few years of establishment and/or development. This is where interim management stands out as a highly valuable tool for a safe and accelerated ‘soft landing’. Executives with proven experience in these processes who have already faced similar situations and challenges in the past.

To tackle this entry into a new market, Spanish companies can rely primarily on two complementary roles:

• Expatriate interim manager: A trusted temporary executive from Spain, whose main mission is to transfer the parent company’s DNA, processes and culture to the new country. A professional with extensive prior experience in the country and knowledge of business relations there. This is the ideal person to launch operations, finalise agreements with third parties, establish quality standards and develop corporate guidelines.
• Local interim manager: A high-level professional from the host country. Their value lies in their network of contacts, their in-depth knowledge of local regulations, bureaucracy and customs, and their ability to overcome barriers to entry. They can accelerate customer acquisition and the consolidation of the company.

Operational advantages for the Spanish company

Bringing in interim managers during the internationalisation phase offers significant benefits over traditional recruitment:

• Financial flexibility: It converts the high fixed structural costs of an internationalisation process into variable costs associated with a project with a defined start and end date.
• Knowledge transfer: The interim manager lays the foundations, trains the team that will take over, and ensures an orderly transition.
• Risk mitigation: The interim manager’s prior experience in expansion processes drastically reduces strategic errors during the first 12 to 18 months – the most critical period of the soft landing.

Patricio Gil has led, and currently leads, interim management services across a wide range of countries in the region and believes that “Latin America and Spain must once again view each other as key allies for operational and technological modernisation”. He therefore believes that “having the right managerial talent to capitalise on this window of opportunity will make the difference between a successful entry and a failed attempt”.

At EPUNTO Interim Management, we understand that the success of any internationalisation process ultimately lies with the people who lead it. If your company is considering making the leap into Latin America or needs to restructure and consolidate its current presence in the region, we offer you our network of interim executives.

Let’s discuss how we can support you in your next major phase of international growth.