Control-alt-delete, A.C.: technology industry associations must be reset to promote competitiveness. (Tech Talk).

Imagine you are an owner of a Mexican company seeking to promote your software or outsourcing services to new national and international markets. You decide to join an industry association, or asociacion civil (A.C.). In return for your membership fees and participation, you receive access to a network of peers and potential partners, market knowledge, strategic practices and promotional services. At least, that's the theory.

In reality, many of the country's technology industry associations are plagued by a traditionally political nature, economic conflicts of interest and counterproductive regionalism. As a result, the vast majority are simply not effective in an increasingly global economy, hurting Mexico's international competitiveness in some of the faster growing sectors. The time has come for technology-focused companies to consider starting over.

REMANANTS OF A POLITICAL PAST

Almost a decade has passed since the legal obligation to belong to an industry chamber has been lifted from the backs of Mexican companies. Until then, most associations were basically political entities, existing solely to provide its directors and (presumably) member companies a voice in public and economic policy.

Since every Mexican company was legally required to belong to a chamber or other industry association, such organizations were assured a healthy fixed annual income and had no incentive to provide affiliated companies with value-added services.

Today, both the guaranteed income and political clout of industry associations have disappeared, but most--even the ones that emerged after the repeal of the "chamber tax"-- still act a lot more like government agencies than client-focused service providers.

When the easy money of required membership dues dried up, industry associations began a desperate search for funds to ensure their survival. Since then, some have begun to offer professional services that are in direct competition with many of the providers they should be serving.

For example, in a recent conversation with an outsourcing industry chamber, I inquired about the services it offered to its member companies. The answer included "consulting, training, quality certifications and publications."

If a technology business owner were to design an industry association from scratch, would he/she include any of those activities in its charter? Of course not. There are real businesses that already fill these needs, and should be participating in, not competing against industry associations.

Not only do such services turn away potential members, they also divert critical focus and resources away from what such organizations should be doing: helping members build stronger businesses through market expansion.

REGIONAL POWER PLAYS

A final, important impediment to the effectiveness of industry associations is the lack of national coordination in promoting Mexican industries abroad.

By my count, there are at least eight regional clusters of export-focused software firms scattered throughout Mexico, each of which is trying to plant its flag in the United States. Unfortunately, while Baja California, Aguascalientes and a host of other states are promoting their interests, no one is promoting Mexico.

The real loss here is that in a market that doesn't know the difference between Queretaro and quesadillas, a one-dollar investment in the promotion of Mexico's national technology industry could probably generate as much economic benefit as a 100-dollar investment of any particular state.

I have yet to encounter any other country that tries to promote its states rather than its national brand. Without a unified national voice, it's no wonder Mexico has a lower technology-industry brand recognition than small players like Costa Rica.

In short, many of the country's technology industry associations simply are more concerned with their own wellbeing than that of their members. Without a clear strategic focus, economic model and service culture, many of these may be beyond repair.

If the goal is to create associations that truly aid Mexican firms, it will be much faster and easier to benchmark effective organizations abroad, rewrite by-laws, raise dues and start from zero than attempt to fix a business model proven not to work.

Bruce Sinclair 

([e-mail]) is the Technology Industries Director for Infoamericas, a multinational research and consulting firm specializing in Latin American markets.