Tech Guru Alvaro Lamé’s Crusade for Telecommuting in Latin America

"Living here, but working there; making money there, and spending it here." That is the phrase entrepreneur Alvaro Lamé and his team use to define the phenomenon of telecommuting. In Latin America, telecommuting began to take hold during the social crisis that affected Uruguay and Argentina in 2002, when unemployment rates were close to 20%, and unemployed people dealt with the lack of opportunities near their homes by telecommuting to jobs in other regions.

Nowadays, telecommuting provides the main source of income for some 100,000 Uruguayans who sell products and services to buyers in more than 54 countries worldwide, either on behalf of their own companies or others. Lamé was the first person to promote this style of work thanks to his vast experience in the area of technology.

It started when he was very young and his father, a public accountant, encouraged Lamé to play a role in the early history of technology by studying various courses offered by IBM. By the age of 17, he was already a programmer. When he was 25, Lamé created his first software company. In 1995, he created Netgate, a pioneer among private-sector companies when it came to offering Internet access.

During the crisis of 2002, Lamé proposed to his fellow Uruguayans that they work for firms based in other countries through new platforms that enabled them to sell products and services over the Internet. One of the principle barriers was a general lack of knowledge and training in the area. In 2009, Lamé responded by creating Epistele, a platform for specialized e-learning in what he calls "personal electronic commerce and telecommuting." The company focuses on providing educational training online.

Lamé, now 53, believes that telecommuting is not only an industry in itself but one of the keys to an emerging new economy in which paper printing will disappear. Thanks to telecommuting, people can readily hire themselves out as architects, designers, journalists, translators and artisans. Lamé recently discussed his efforts with Universia Knowledge@Wharton.

An edited version of the transcript appears below.

Universia Knowledge@Wharton: What did being an entrepreneur mean for you when you started out? What were the main challenges you faced and how have you dealt with them?

Álvaro Lamé: It was a very intensive period of learning. My entrepreneurial experience had been relatively limited, and it was all in very small companies. When I was 25, I had to learn to manage a company that was growing very rapidly, but I had a lot of trouble doing that because of my shortcomings as an entrepreneur.

However, two things helped me deal with those problems. First, I trained myself by participating in a program for corporate managers at the University of Montevideo. Second, I hired specialized professionals in the areas that were my largest shortcomings.

In particular, I brought in a financial manager whose salary was twice as high as mine. The decision to hire him wasn't an easy one, but the results were excellent.

UK@W:In 2002, you undertook a crusade for the development of personal telecommuting in Uruguay. How and why did this crusade emerge?

Lamé:In 2002, Uruguay was experiencing a very intense crisis as the result of a financial problem involving both Uruguay and Argentina. Unemployment rates were above 20% in Uruguay, which has only a little more than three million people, and has a very small domestic market as a result.

The country had to innovate in order to find other ways to generate revenues for its people, and so autonomous and independent telecommuting surged as a result.

UK@W:What advantages could the country rely on at that time to promote telecommuting? And what disadvantages did it have?

Lamé:The advantages were the same things we normally considered disadvantages. The crisis and the small domestic market forced people to move toward new models.

Our disadvantage was a cultural one. It was hard for people to visualize that they could sell products and services to the whole world. On the other hand, there has never been such an intensive and natural usage of technologies as there is now.

We began by giving talks and conferences that were based more on our intuition that we could sell products and services worldwide than on any knowledge about how to do that. Without doubt, the way to overcome our challenges was to rely on training. We also devoted a lot of resources to promoting our success stories in the mass media.

UK@W:Was the lack of training one of those disadvantages?

Lamé:Yes, our disadvantage at the time was a lack of knowledge about what we could do and how to do it.

So in 2002, we created brief, four-hour in-person workshops; a total of six workshops for various kinds of purposes. We created a research and development department with content for training people. This personal initiative was supported by Netgate, the company that ultimately financed the project, because we had no support from the government.

In 2009, we created Epistele, which was the natural result of always using technology to make life easier for people, both while they were working and when they were studying. With respect to telecommuting, online education was the main tool that we relied on for training people, including when conditions required us to present face-to-face workshops.

UK@W:What role do you play today with respect to online education in your country, and in the area of telecommuting? How has the online educational sector evolved, and where do you believe that it is headed?

Lamé:It is gradually changing. Uruguay has the advantage of having completely implemented the Ceibal Plan (based on the "One Laptop per Child" plan; Ceibal is the Spanish-language acronym for "Educational Connectivity for Basic Computing for Learning Online.") It involved delivering a personal computer to every primary and secondary student in the public education system. I believe that education in this generation is moving inevitably toward an online model, and that the newest generation is demanding that process.

UK@W:Returning to telecommuting, what kind of people are typical telecommuters in Uruguay? How many telecommuters do you calculate there are in Uruguay and in the region?

Lamé:When it comes to self-employed online workers who sell their own services and products or those of third parties, there are a broad range of age groups and an equal distribution of males and females. Fifty percent of them live in the interior of the country and the rest live in the capital [Montevideo]. At the moment, we estimate that there are [a total of] 100,000 such people in Uruguay.

There is no exact, typical profile. There are craftsmen, college-trained professionals, product intermediaries, translators, and [various other kinds of] content generators. I believe that the big difference from other countries is that the small size of the Uruguayan market forced our people to search for other markets, whether or not they wanted to do so.

UK@W:My understanding is that Chile led the way in 2010 with the development of a pilot program for training online workers. It trained more than 7,000 people. Tell us a little bit about that experience. Why Chile?

Lamé:We were brought in by the government of Chile, in a project headed by Chile's Office of Digital Strategy. We trained 7,000 people [in Chile], and managed to transfer enough knowledge to enable them to move forward with the program [on their own]. The goal for the current government [of Chile] is to train [a total of] 100,000 people.

As far as I know, no other program exists in Latin America that is focused on self-employed telecommuting. The goal is to wind up with at least 100,000 people in Chile who can opt for telecommuting. Everywhere we've gone, the principal shortcoming has been a shortage of training.

UK@W: How important do you think telecommuting will be in Latin America over the medium term? And how would you characterize the typical telecommuter? What challenges does this sort of employment face in order to keep growing?

Lamé:It is only a matter of time before telecommuting becomes the principal way of working. I believe that it will adapt more and more to what people really want, which is to have more flexibility in their lives. The eight-hour day, the annual twenty days [four weeks] of vacation; getting off work only on Sundays — and so forth; such limitations belong to the Industrial Revolution. Nowadays, we are undergoing the digital revolution, which allows us to see things from another perspective.

The next generation is going to force a change because the digital generation has already realized that it can live life in a different way, especially when it comes to educating itself and working.

There are various kinds of challenges involved in working online, depending on whether you are working for others or for yourself. In the former case, you need a regulatory framework; there are several countries in Latin America that already have their own laws for telecommuting, although this is only part of the problem. The important thing is to make labor laws flexible, and that requires changing the way people think. Meanwhile, self-employed telecommuting is only a question of training. The issues have to do with what you can do and how you need to do it, but you do not need to become an expert in the use of a computer. Obviously, knowing [foreign] languages is an advantage, but it is not [necessarily] an obstacle [if you don't know any.] It is important that everyone be able to make their own decisions [about telecommuting].

I don't know of any other programs that are like ours, focused on the development of autonomous telecommuting, but several countries have invited us so they can learn about our experiences.

UK@W:How did you manage to carry out your idea of installing free Wi-Fi connections in the public plazas and the Montevideo bus project?

Lamé:In order to provide options for telecommuters and users of the Ceibal Plan, we developed Wi-Fi in the public plazas [of Montevideo]. Today, when you walk through those plazas, you see students with their 'ceibalitas' — computers from the Ceibal Plan — as well as adults who are telecommuting; depending on the weather.

All of us face the great challenge of closing the digital divide [between those who are connected and those who are not]. In Uruguay, in particular, the Ceibal Plan has already distributed more than 500,000 computers.

We also did the same thing in the bus system of Montevideo, so that users could navigate with wireless, free Internet. [In 2008, the Uruguayan capital became the first city in Latin America to offer this service.]

UK@W:Can we safely predict the demise of the paper book in the near future? When do you believe that will happen in Latin America? Will the same thing happen among poor people who have no access to new technologies?

Lamé:Yes, without any doubt, paper will wind up being an antique technology, and that's not even considering the environmental damage [that results from using paper]. Already, the digital generations are no longer using paper.

UK@W:What recommendations would you make to young people who enter the business world at an early age?

Lamé:To achieve success, you need to prepare yourself to make sacrifices. Being a successful entrepreneur isn't something that comes free of cost. I recommend that they believe in their own dreams, trust their intuition, and surround themselves with capable people.

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