How COVID-19 Accelerated Digital Transformation in Peru’s SMEs

The COVID-19 pandemic disrupted life and business as we knew it, forcing rapid adaptations in nearly every sector. In countries like Peru—where over 95% of businesses are micro, small, and medium enterprises (MiPymes)—this disruption exposed deep digital divides while also catalyzing an unexpected digital leap forward. But was this acceleration enough to spark long-term transformation?

A 2021 article by independent researcher Jimmy Velásquez, published in Ciencia y Práctica, explores how Peru’s digital transformation unfolded during the crisis and what it means for future competitiveness, equity, and innovation in the country’s business ecosystem.

SMEs at the Heart of the Storm

Before the pandemic, Peru had already laid the groundwork for a digital future through initiatives like the Plan Nacional de Competitividad 2019–2030, which emphasized information technologies (IT) as a pathway to economic development. However, digital adoption among SMEs remained low due to limited resources, lack of digital literacy, and fragmented infrastructure.

When COVID-19 hit, lockdowns and social distancing forced many SMEs to pivot online overnight—adopting e-commerce, digital payment systems, and remote communication tools just to survive. Velásquez frames the central question: Did the pandemic merely prompt temporary digital fixes, or did it accelerate genuine transformation across Peru’s business sector?

A Research-Based Analysis of Digital Shifts

The article relies on a documentary review of public policies, global consultancy reports, and statistical indicators. Velásquez draws from sources like IDC, PwC, and Gartner, as well as national decrees and sectoral data. Notably, the research highlights:

• 66% of global CEOs now view digital transformation as central to business strategy (IDC).
• Only 16% of CFOs intend to cut digital budgets post-pandemic (PwC).
• Peru’s Decreto de Urgencia 006-2020 established a national digital transformation framework.

Although the study lacks original fieldwork, its strength lies in synthesizing diverse sources to provide a coherent snapshot of digital momentum during the pandemic.

Key Findings: A Surge in Digital Adaptation

1. Rapid Digital Uptake

The shift was swift and widespread:

• Businesses launched online stores, remote support systems, and digital platforms within days or weeks.
• Consumers embraced digital services—from streaming to online shopping—fueling new customer expectations.

In short, digital interaction became a lifeline, not just a convenience.

2. Private Sector Commitment

The numbers reflect a structural shift:

• Most CEOs integrated digital transformation into core strategies.
• The majority of CFOs maintained or increased IT spending even amid economic uncertainty.

3. Government as an Enabler

Peru’s regulatory push through the Decreto de Urgencia 006-2020 created a formal ecosystem for digital transformation. Other efforts included:

• Training programs for SMEs in digital tools
• Creation of digital government services
• Partnerships between public agencies and private firms

These interventions laid the foundation for sustained progress—if implementation is consistent and inclusive.

4. Challenges for SMEs

While large firms adapted quickly, SMEs faced barriers:

• Limited digital skills
• Inadequate infrastructure
• Financial constraints

Despite these obstacles, the article points to isolated success stories and sector-specific gains—especially in mining and services.

Rethinking What “Digital Transformation” Means

The pandemic reshaped how we understand digital transformation. It's not just about technology deployment—it’s about strategic reorientation that touches every layer of an organization: culture, operations, customer service, and leadership.

Velásquez emphasizes a conceptual shift echoed by industry leaders like Salesforce, HP, and Gartner: digital transformation is systemic, not cosmetic. It's not about flashy apps—it's about sustainable evolution.

A Path Forward: From Survival to Sustainability

Policy Recommendations

The study outlines specific actions to strengthen digital resilience:

• Invest in digital literacy, especially among small business owners.
• Develop local innovation ecosystems, including incubators and mentorship programs.
• Align regional and national digital agendas to avoid policy fragmentation.
• Track progress using clear metrics like number of digitized companies or online sales growth.

Social Implications

Done right, digital transformation can close socio-economic gaps. More equitable access to technology means more inclusive opportunities—for employment, education, and entrepreneurship.

Yet risks remain: without targeted support, digital inequality could worsen.

Conclusion: Crisis as Catalyst, Not Just Disruption

Velásquez’s analysis underscores that COVID-19 acted as a catalyst, not just a disruptor. The accelerated adoption of digital tools, supported by regulatory frameworks and sustained private investment, points to a pivotal moment in Peru’s economic evolution.

But the transformation must continue. Digital strategies must extend beyond short-term adaptation to foster long-term resilience, especially among SMEs. The Peruvian experience offers lessons not only for Latin America but for any country navigating the balance between urgency and sustainability in the digital age.

Topics of interest

Technology