Market leadership in Brazil’s ICT sector: the cases of Totvs and Positivo

The purpose of this paper is to examine the explaining factors of the market leadership of two Brazilian companies in specialized fields of the Information and Communication Technologies (ICT) sector. Whilst Totvs is a software house, dedicated to the Enterprise Resource Planning (ERP) segment since its foundation, Positivo is an assembly line of personal computers (PCs), which emerged as a spin-off from an economic group originally focused in educational services. Throughout the paper, case studies of both companies are performed, based on literature review, financial statements, press articles and in-depth interviews. In both cases, national idiosyncrasies have supported the emergence and consolidation of each company as a market leader. Notwithstanding economies of scale and scope are essential sources of competitive advantages in the ICT sector in general, both cases exhibit a combination of two other factors that counterbalance their initial disadvantages with respect to their international competitors. First, governmental support has been crucial, although using different approaches. Totvs’ leading position has been reinforced by financial support from the Brazilian National Development Bank (BNDES), while Positivo has benefited from trade protectionism, under the “infant industry” argument. Second, both companies have achieved market leadership through the development of customized products and solutions to specific market segments that have not been properly addressed by world industry leaders, combining some technological capabilities with marketing capabilities. Recently, both companies have made efforts to enter the global market. Up to now, they both have focused on Latin America, in order to explore cultural, idiomatic and institutional similarities with Brazil. O objetivo deste trabalho e analisar os fatores que explicam a lideranca de mercado de duas empresas brasileiras em campos especializados das tecnologias de informacao e comunicacao (TICs). Enquanto a Totvs e uma empresa de software, dedicada ao segmento de sistemas de gestao empresarial (enterprise resource planning – ERPs) desde sua fundacao, a Positivo Informatica S/A concentra-se na montagem de computadores pessoais (personal computers – PCs), tendo surgido como empresa derivada (spin-off) de um grupo economico originalmente focado em servicos educacionais. Este trabalho efetua um estudo de caso de ambas as empresas, com base em revisao da literatura e entrevistas semiestruturadas. Em ambas as situacoes, supoe-se que as idiossincrasias nacionais foram responsaveis pelo surgimento e pela consolidacao de cada empresa como lider de mercado. Nao obstante que economias de escala e escopo sejam fontes essenciais de vantagens competitivas no setor das TICs, os dois casos estudados apresentam combinacao de dois outros fatores que contrabalancam suas desvantagens em relacao aos seus concorrentes internacionais. Em primeiro lugar, o apoio governamental tem sido crucial, embora tenha sido realizado por meio de abordagens diferentes. A Totvs foi fortalecida pelo suporte financeiro do Banco Nacional de Desenvolvimento Economico e Social (BNDES), enquanto a Positivo se beneficiou de protecionismo comercial, com base no argumento da “industria nascente”. Em segundo lugar, ambas as empresas alcancaram a lideranca do mercado por meio do desenvolvimento de produtos customizados e solucoes para segmentos de mercado especificos – que nao haviam sido devidamente atendidos pelos respectivos lideres mundiais –, ao combinar competencias tecnologicas e mercadologicas. Recentemente, as duas empresas tem realizado esforcos para entrar no mercado global. Ate agora, ambas tem foco na America Latina, com o objetivo de aproveitar as similaridades culturais, idiomaticas e institucionais com o Brasil.