Wednesday, May 27, 2020

How can the ICT sector in Colombia was affected by COVID-19 and how can it be recovered?

Authors: Bryan Bohorquez (bbohorquez@eafit.edu.co ); Miguel Ceballos, Maria Jose Franco Mejia (mjfrancom1@eafit.edu.co ) & David Muñoz (Ethics and Social Responsibility undergraduate course at Universidad EAFIT).


1. Introduction


The relationship between this assessment and ethics and social responsibility is to be able to see how different companies of different sectors are being affected by this huge issue that is COVID-19. This will also help to see how the different sectors are working to overcome this issue and if they are helping to overcome this pandemic in Colombia or maybe if they are doing the opposite and not making ethical decisions in their organizations. 

Data collected from the daily reports of the Colombian Ministry of Health at its twitter account (by 16th May 2020)



Description of the sector:


The information, communication and technology sector are “made up of the manufacturing and service sectors whose main activity is linked to development, production, commercialization and intensive use of new technology” ("What is ICT Industry | IGI Global", n.d.)and the companies in this sector provide services related to broadcasting, computing and telecommunications, all of which capture and display information electronically. In Colombia, this sector is extremely important to the economy because of the different organizations in the sector that are round 5.400, and in 2015 the employment rate in the sector grew to 90.978, but more important on mobile telecommunications and internet access which has shown a penetration rate of more than 100%. In this assignment we will be describing the different companies that take part of this sector and how they have impacted the community during the pandemic. 

2. Impacts of COVID-19 in the ICT sector in Colombia 


Vulnerabilities of the sector: The ICT sector has been affected in both ways, good and bad. The weakest point they are presenting on this difficult time is the customer service because sometimes the internet and other sources of communication like phones or cellphones can suffer different issues because everybody is using them, so they can collapse. For the different industry companies is very difficult to attend and solve the problems of all the homes, companies, and people problems. Other vulnerability is the earning from advertisement and events, during the year the different companies sponsor events and make a lot of money from advertisement, but a lot of companies need to be very careful and they cannot invest in advertisement. to finish they are vulnerable in an economic way because some people will not pay the bills because they are not having earnings.

Short term: During the short term, the sector of ICT has had a lot of different impacts. The demand of customer service increase a lot, internet consumption in homes increase in an important number, internet consumption in most of the companies decreased, low internet speed, more users will demand the different services, create different plans to help people with economic problems, create campaigns and advertisements to prevent the virus.

Long term: Its evident that the sector has been benefited during this situation because the demand has increased in an important number but in the long term the impacts will be very bad and serious, a lot of companies and users will not be able to pay their bills because a lot of businesses are finishing, a lot of people is not having their regular wages so it will be very difficult to pay this services.

Pace of recovery: If the Pandemic continues for a long time the recovery of the sector will be very slow, the sector will recover when people start working in a regular way and all the industries recover and start paying the fair wages.


3. Responses to COVID-19 crisis


National government:

  • Identifying the vulnerable: government announced that people with low resources are most vulnerable to this situation so the older people, also said that ethnic groups and people with incapacities have more risks. 
  • Social distancing: according to Tikitakas. (2020, april 13). they said “1. Wash your hands frequently, 2. Don't say hello to people with kisses or handshakes, 3. If you cough, cover your mouth with your elbow bent or with a disposable handkerchief, 4. Avoid touching your eyes, nose and mouth, 5. If you have a fever or shortness of breath, seek medical attention, but call line 123, 6 first. Follow the instructions of the local authorities and nation”. 
  • Travel restrictions: El Tiempo. (2020, march 19). In the 19 of march of this year Colombian government said that from 23 of march the country closed all international fly’s to Colombia in order to contain the spread of the virus for 30 days, with the exception of international fly’s that brings resources like food and medicine and other supplies. Also, transportation of supplies and interstate transport is allowed, but only to adolescents and kids, older population have to stay at home. They still close until day 
  • Closing borders: Acording to Francesco Manetto, F., 2020. the government of Colombia closed all borders in 17 of march until the 30 of May to all neighbor countries in order to stop de coronavirus from speeding 
  • Lockdown: acording to Tikitakas. (2020, april 13). Colombian government declares lockdown t 24 March until the 13 of April, but the 13 of April they extended to the 26 of April with the possibility of more extensions, this due to the increase number of infected. 
  • Financing responses: acording to Semana. (2020, april 10). Created the “Fondo de Mitigación de Emergencias (Fome)” in order to help economie issues, 
  • Recovery plans: Non-Available. 
  • Business continuity measures: according to El Tiempo. (2020, march 19) the government announced thar from the 23 of March all business must be closed until 15 of April and the food commerce may work but only in a digital way and by delivery. Also establishment that produces and provides main necessity products don’t have restrictions to operate, to this day this restrictions still operates 
  • Donations- front-line medical services: according to Republic P. (2020, april 10). thanks to the campaign “Ayudar nos hace bien” the government could donate 3 million pesos for food to vulnerable people. Donations according to Tiempo, T. E. L. (2020, april 9). multiple companies made collaborations for covid 19 like Postobon who donated 9.000 to health and Argos 10 million pesos in materials and Exito group donated food packages for the one who needed most 
  • Social distancing: according to Tiempo, T. E. L. (2020, april 9 companies like amazon, Postobon and Argos they have very restricted rules and punishments for those employees who not take care of themselves and comply with the restrictions that government and the minister of health dictated. 

4. Comparison of impacts and business responses:

Other sectors in Colombia:

  • According to the International Air Transport Association (IATA), Latin American companies will lose revenues of $ 15 billion this year. 
  • It's estimated that this pandemic will take 314,000 million USD from the sector, thanks to the drop of the 90% of world passenger traffic. 
  • The captain Jaime Hernández, in representation of the Colombian Association of Civil Aviators (Acdac) they decided to offer their services for cargo and humanitarian flights, during the world emergency due to the coronavirus pandemic. 
  • The more than 750 pilots who are part of Acdac, from controls such as Avianca, Latam, and Copa Airlines, announced that they will make the collection of their payments more flexible to help a little in the financial health of their companies. (Leal, 2020) 
  • According to Anko van der Werff, CEO of Avianca Holdings the effects of the COVID-19 have confronted them in the most challenging crisis of their 100-year history as a company. ("Avianca pidió la quiebra en EEUU por el impacto del Covid-19", 2020) 
  • Avianca declares bankruptcy due to the impact of Covid 19 
  • Avianca has reported a drop of 80% of its income. 
  • They reported that 14,000 of the 20,000 employees were discharged without pay. 
  • Thanks to New York Chapter 11, Avianca will be able to try to restructure their debts in a better way. 
  • They did a committed saying that they will do everything possible to preserve all their jobs 

Same sector in Latin America: 

Brazil: 
  • Claro and Nextel informed that they will not reduce the data speeds of their clients although the plan is already finished. 
  • TIM gave free access to cloud work packages like Microsoft Office. 
  • Claro, Net TV, Sky, Oi, Vivo and Algar Telecom opened access to several television channels that previously required to cover additional fees. 
Chile: 
  • Claro, in alliance with Cisco Webex, Google and Microsoft, made collaborative tools available to SMEs and large companies in the country, with up to three months at no cost for the first two, and six for the last (Contreras, 2020) 
  • Movistar, Claro, Entel, WOM, VTR, and noGTD enabled access to official educational platforms in the form of zero-rating. 
Ecuador: 
  • The government and the sector expanded bandwidth to support growth in consumption. 
  • No company will suspend its services from any client.
Peru: 
  • Companies will not interrupt services, even if customers do not cover invoices. 
  • Claro, in alliance with Cisco Webex, Google and Microsoft, made collaborative tools available to SMEs and large companies in the country, with up to three months at no cost for the first two, and six for the last (Contreras, 2020) 
  • Claro and Movistar released premium pay television channels until March 31 
Argentina: 
  • Telecom activated zero-rating on government educational content and prepaid recharge gifts, as well as more data. 
  • Movistar offered more gigabytes at no additional cost, free SMS, free-roaming, extra video content and online games, and balance loans for postpaid customers.
Colombia 
  • Claro increased data for postpaid customers and converged landlines by 50 percent 
  • Some companies are still using their personal # to remember their clients to be home the most possible. 
  • Claro, Movistar, Tigo, DirecTV, ETB y EMCALI enabled zero rating for government applications on the pandemic. 

Same sector in the rest of the world:

  • The main UK mobile networks suffered disruptions as millions of people started working simultaneously from home. 
  • Vodafone stated that its systems crashed 4 hours in some parts of Europe. 
  • WhatsApp was forced to increase coverage by 40%, incurring huge expenses. 
  • The UK regulatory agency OFCOM advised its residents on limiting downloads and the use of landlines rather than mobiles 
  • The UK was forced to invest much more in fiber optic technology. 
  • Several companies in Spain have increased the power of their services at no cost to their clients. 
  • Analysts from the consulting firm IDC Canada predict that several companies in this union will present losses. 
  • Safaricom has supported the government of kena in the establishment and operation of a 24-7 COVID-19 Information Centre. 
  • Safaricom has donated thermal cameras with a cost of 10 Million KES to the Ministry of Health (kena). 

5. Best practices in terms of social responsibility, recovery, and long-term sustainability:


  • The minister of the TIC´s Karen Abudinen announced that families with lower incomes will have the opportunity to apply to access subsidies that will allow them to have low cost internet in their homes. This project will help 500 families in Colombia. These families can access this help via a link or via phone call. (Hernández, 2020) 
  • Organizations in this sector have developed different initiatives to maintain connectivity during the pandemic ("Empresas del sector TIC proponen soluciones para garantizar la adecuada conectividad", 2020): 
  • Increasing internet capacity to nearly 400,000 homes with no additional cost 
  • Virtualization of services so people do not have to go out to pay their bills 
  • CoronApp for free with educational content to complement education sessions 
  • This sector became the perfect tool in Colombia for virtual education, working from home, commerce and even helping the congress sessions to take place virtually. The sector has provided tools for all these things to take place virtually an allowing interaction between people without having to meet up in person. This sector is also helping to re-open organizations and economic activities helping to accelerate the economy. ("“El papel de las TIC durante la pandemia ha mostrado su potencial”", 2020) 
  • The ICT sector are helping to keep the economy going, but it is also benefitting medical professionals who are taking lessons in the global community to inform themselves more of COVID-19. (GHOURALAL, 2020) 


6. Recommendation for restoring economic activity, employment, and social well being: 


Recommendations for policy makers (government):

  • The government that it’s in charge of the work and companies’ sector should create better policies that help companies to sustain during the pandemic. 
  • Government should work in better ways to create consciousness to the citizens that still thinks that this situation it is not serious. 
  • Companies and the government should work together to create a system that can work during this pandemic so the citizens would be affected by its consequences. 

Recommendations for business (managers, entrepreneurs and employees): 

Start creating coupons that customers can use after the pandemic comes to an end. Start using social media and technology to increase their earnings during quarantine. Freeze debts until the industry recovers. Train employees to start using technology in a more efficient way to work from home. Managers should give free programs to monitor people to prevent the virus like in Korea, start creating tele medicine where people from far places to be diagnosticated.

Recommendations for civil society (business organizations, customers, NGOs, media):


People should follow the orders of staying at home to flatten the curve, business should provide information to their clients about the pandemic and enforce this stay at home rule if they can on their employees. The media should inform of how this pandemic is affecting the community not only the economy and provide information on how people can prevent it from spreading. 

7. Conclusions:


This study analyses the risk management and social responsibility responses associated with the pandemic outbreak of COVID-19 by ICT sector in Colombia from the moment the pandemic was announced by the Colombian Government, until it was declared controlled. The findings of this study show that in places where institutional measures are most drastic and adopted earlier, there were many different ways government tried to lower the contagion rate by encouraging and donating technology to the people, so they can work and study from distance avoiding physical contact and the spread of the virus, they are going hand to hand with technology and for a long term since we don't know how long the Covid-19 will last. The ICT sector has benefited because the demand of their services has increased a lot since the mandatory quarantine has been applied. On the other hand, the customer service sometimes collapses because a lot of users are complaining. The environment is the most benefited during this issue because people are staying at home so, pollution has decreased and the air quality is almost perfect because a lot of companies stop production and there are no people using cars, bikes or trucks.

The best practices in this sector provided by the sector in Colombia to mitigate the impacts of the Covid-19 pandemic were:
  • Facilitating employees with tools to work from home 
  • Giving their users incentives such as faster internet, premium tv channels, all for free. 
  • Providing tools to understand the pandemic for free 
  • Providing subsidies to help families in need access the internet 
Measures that could have helped during the pandemic. These measures were implemented by other places in the world that could be set as an example in Colombia:
  • The most significant thing that we found very useful was the donation of thermal cameras by Vodafone in Kena. 
  • Some companies should increase the time giving to inform more about how we can prevent in a better way this illness. 
  • Some companies should give more free access to cloud work packages like Microsoft Office.
In order to provide a successful response, and having an early recovery, managers should have ethics based on making decisions that will not only affect in a positive manner their own employees, but the community around them, and they should count with the following personal values: 
  • Integrity 
  • Honesty 
  • Compassion 
  • Determination 
  • Responsibility
This to work in an ethical manner and provide tools to help the people around them overcome this pandemic. 

Based on the evidence, the social responsibility of business in the ICT sector in Colombia are:
  • Giving the opportunity of less fortunate families access to internet services at a low price 
  • Giving families educational tools to learn about the pandemic for free 
This study concludes that to be a sustainable business in the ICT sector companies must:
  • Companies must provide tools for their costumer to pay easily through internet services 
  • Make ethical decisions to protect their employees and the community where they are located and preventing the disease from spreading 
  • They must improve their customer service  

References:










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