PREVIOUS ARTICLENEXT ARTICLE
NEWS
By 27 January 2021 | Categories: news

0

The global pandemic remains an ongoing part of business reality in 2021. IDC notes it is time for organisations to reset their expectations and their goals to ensure that they can thrive in the next normal; that they can embed strategies that allow for their organisations to enable the digital enterprise of the future. For Mark Walker, Associate Vice President for Sub-Saharan Africa at IDC Middle East, Africa, and Turkey, unique environmental and commercial requirements will drive investment and growth in 2021.

“The sub-Saharan African region does have positive macro-economic growth prospects with GDP in Southern Africa expected to grow by 2.5%, East Africa by 4.5%, and West Africa by 3%,” he adds. “While South Africa, Nigeria, and Kenya continue to show an increase in unemployment thanks to the pandemic and quashed economic growth, there are still solid foreign direct investment flows that offer the continent opportunity for growth and both South Africa and Kenya’s Business Confidence Indices show a significant positive upswing.”

As change continues as the only constant, C-suite executives are looking at different priorities when it comes to technology investment over the next year. For the CIO, shifts in competition, growth, and revenue have meant revising approaches to IT spend. Sectors such as transport, energy, resources, and tourism were heavily impacted by the pandemic and are expected to make a slow recovery – mining, and oil and gas at a more positive pace than transport and tourism. The production and trade value chain, including manufacturing, retail, and wholesale, were heavily disrupted by the virus, but they have been quick to adapt to the next normal and their recovery will likely be quicker.

“The finance and government sectors are continuing focus on digital transformation (DX) to drive efficiencies and reduce costs as the months ahead are expected to put pressure them to do more with less while catering to customers through digital channels and business models,” adds Walker. “Professional services and telcos, less impacted by the pandemic, will continue with their technology investment as the pandemic has increased demand for IT and business services, and continued digital transformation momentum is critical to remain competitive. Healthcare and education were the only sectors to see increased spend in 2020 with years of digital transformation compacted into only a matter of months. This trend is likely to continue.”

The key areas of growth within the technology space are anticipated to be robotic process automation (RPA), analytics, artificial intelligence (AI), and the Internet of Things (IoT), primarily due to their potential to optimise system and process efficiencies. Cloud adoption is at an all-time high – already Microsoft and AWS are based in South Africa and more hyperscalers are on the way. There are multiple data centres being built in Kenya, Nigeria, and South Africa, and Software-as-a-Service growth across the sub-Saharan region is expected to be 23.8% through to 2024. In the security space, automation and cloud are significantly changing the face of security operations as there is a growing preference for outsourcing security to managed service providers to reduce internal costs on skills development, talent, and resources.

“South Africa, Nigeria, Kenya, and Rwanda have been leading the way in the adoption of third platforms and innovation accelerators,” says Walker. “FNB and the South African Police Services in South Africa have been using AI and analytics to stay ahead of risk, the Rwandan Ministry of Health developed an AI-powered digital platform for healthcare, and the Kenyan Ministry of Tourism and Wildlife with Alibaba are using IoT and AI to track and protect wildlife from poaching. Overall, there has been significant investment in technology, and this is likely to continue over the next 12 months.”

Uncertainty, acceleration, and reinvention. These are the three keywords that are set to shape digital transformation investment.  The pandemic has accelerated around 46% of digital initiatives by at least a year, and by 2021 at least 50% of organisations will be launching new lines of business that are driven by DX investments. The digital-first approach will underpin African ICT investment as 7% of enterprises invest heavily in business process transformation to enhance customer engagement, employee productivity, and business resiliency. This investment into robust and agile technology will help companies future-proof their business and transform relationships between partners, competitors, suppliers, and employees.

“As a result of these market forces, there is also a shift in CIO and line of business priorities as companies look to revamping operations (77%), developing new business models (52%), and creating new products and services (45%),” concludes Walker. “Around 50% of companies are focusing on operating a digital enterprise in the new normal to ensure stability as things remain in flux, globally and locally as a result of the pandemic.”


As South Africa continues to wrestle with past and current challenges, brought on by COVID and those pre-COVID, there is hope and opportunity for organisations to grow.  Organisations can look to building rich ecosystems of partners and alliances that allow for them to prepare for the upcoming spikes and troughs and that will emphasise and reward business agility. Organisations and public enterprises need to invest in technology that can help them adapt quickly. This is the future, which will require both public and private sector to step up and lean in to ignite economic competitiveness and continue investment into future proof technology.

USER COMMENTS

Read
Magazine Online
TechSmart.co.za is South Africa's leading magazine for tech product reviews, tech news, videos, tech specs and gadgets.
Start reading now >
Download latest issue

Have Your Say


What new tech or developments are you most anticipating this year?
New smartphone announcements (11 votes)
Technological breakthroughs (14 votes)
Launch of new consoles, or notebooks (9 votes)
Innovative Artificial Intelligence solutions (9 votes)
Biotechnology or medical advancements (16 votes)
Better business applications (6 votes)