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Digital Transformation: The implications for the African continent (Demo)

There are two schools of thought on the potentials of a digital Africa. Some argue that digital transformation would help Africa leapfrog its challenges and accelerate into the future while others argue that since Africa’s challenges are inherently tied with its infrastructural deficits, digital transformation can only offer some cosmetic solutions.


The most obviously cited example by the leapfrogging school of thought is the case of GSM telephony, a solution that has made communication easy across the continent, a feat that has been achieved without going the route of wired connections as seen in early Europe and America. The other school of thought is however sceptical about the potentials of a digital Africa. This school cites the example of the e-commerce platforms which haven’t really achieved scale in the continent. They opine that though many of such e-commerce platforms appear shiny at the surface, at the backend, they are struggling. Top among these struggles is the issue of logistics problems as a result of the poor and underdeveloped network of roads and other infrastructure.


The good news is that irrespective of whichever school of thought is considered, evidence abounds that Africa has not been excluded from the digital transformation tide blowing across the world as highlighted in this piece.


Today’s Expectations are Global

Though digital transformation offers immense benefits to organizations from an operations point of view, one important driver of digital transformation has been customer expectations.

With every generation comes an expectation that defines it. The new Millennial generation has been characterized as one generation that wants everything on demand and as fast as possible. Fast food, fast fashion, fast cars among many others. With Africa having a predominantly young population (mostly millennials), nothing less is expected. Though many of them may not be widely travelled, the influence of the internet and Hollywood (among other aspects of globalisation) have facilitated a cross-fertilization of ideas that have left this dominant African population with some expectations that are similar to that of their global peers.


As a result of the impact of globalization and the expectations of a globalised service, travellers across various regions now have a pre-defined set of expectations and would choose services that closely match their levels of expectation. Businesses therefore have no choice but to respond to those demands in order to stay in business and remain relevant. From banks that are issuing electronics cards that are globally acceptable, to local airlines that are connecting to global reservation systems, to Governments that are making it possible to fully register a business online in order to ease doing business, African organizations are embracing digital transformation in order to meet these consumer expectations.


Mobility Remains the Lowest Hanging Fruit of all Enablers

While digital transformation is powered by key enablers such as social platforms, cloud computing, mobility, big data, artificial intelligence (AI), the Internet of Things (IoT), and robotics. In my opinion, mobility (and mobile technologies in general) offer Africa the strongest bridge to growth, scale and transformation.


According to key statistical indicators released in 2018, Africa, in just a couple of years has seen more than a billion mobile connections (representing 82% of the population) and 435 million internet users (34% of the population), with both (connections and internet users) growing annually at 20% and 4% respectively since 2017. Along with this growth is an increase in the penetration of improved connectivity solutions (such as 4G). Meanwhile, as the technologies are improving, prices are reducing which makes mobile the easiest enabler in Africa’s digital transformation journey.


One industry that has taken a major advantage of mobile is the financial services industry and this has enabled them to achieve scale in their solutions offering. One of such solutions is electronic banking (e-banking) which is designed based on the availability of mobile devices. For example, a commercial bank in Nigeria of recent has taken a bold step towards digital transformation by going beyond just electronic banking to creating what it acclaims to be Nigeria’s first fully digital bank.


Though social media is another leader among the enablers of digital transformation in Africa, its major purpose has been more of an engagement and interaction platform. The opportunities it presents as regards personalization of services and as an effective tool for business engagements is yet to be significantly explored in Africa.


Unlocking Opportunities from Challenges

Though Africa is showing a lot of potentials, its numerous challenges cannot be ignored. These challenges however represent opportunities that can be exploited by leveraging digital solutions.


Take Kenya as an example. When Safaricom (a Kenyan telco) launched their mobile money solution (MPESA) in 2007, less than 10% of Kenyans had access to financial services. However, today as a result of the MPESA revolution, about 70% of the adult population is now included.


In Africa generally, opportunities have also been created for ride-sharing platforms such as Uber. This in turn has created immense value for both riders and drivers. A significant population of these drivers are people who though are well-educated but have been challenged in the labour market.

Through these two examples, Safaricom and Uber have shown how companies could take advantage of mobile as an enabler to unlock the opportunities available in Africa’s financial and transportation sector respectively.


The Talent Challenge

Africa has a large youth population. But with this population is a challenge of skills.

However, an opportunity exists for governments and corporations to leverage digital transformation to enhance the skills of that population and thus assist in providing a decent means of livelihood for them.

Some organisations have already started taking advantage of such opportunities in order to bridge the talent gap. Prominent among this is an initiative by the African Development Bank, in collaboration with the Rockefeller Foundation, Microsoft and Facebook to launch “the Coding for Employment Program”. This program involves training the youths in some key areas of information technology that are demand-driven and then matching the trained with potential employers. This program is expected to create more than 9 million jobs and also reach 32 million youths and women across Africa thus unleashing the next generation of young digital innovators from the continent and also assisting to solve some part of the talent challenge.


Governments are not Left Behind

Some African Governments have also started responding to the need to embrace digital transformation. For instance, in responding to the need to increase the ease of doing business in Nigeria, the Nigerian Corporate Affairs Commission (CAC) has made it possible to register and incorporate a business online, without paying a visit to any of its offices. This initiative is both commendable and laudable.


Another example is in Morocco. In order to improve and deepens governance and  interaction with the citizenry, the government has developed some electronic consultation platforms where citizens can access legislative materials online, read and download them, and also post their comments and concerns.


These are just a few examples of how Governments across Africa are carrying out digital transformation efforts for improved Governance and engagement. Of course there is always room for further improvement.


Some Vital Sectors need to Catch Up

Some sectors have not really grown much though. Among these are the educational and healthcare sectors.

While we cannot over-emphasize the fact that access to quality education and affordable healthcare remains two critical needs in Africa, it has been observed that these sectors have not enjoyed much success and scale in the drive towards digital transformation compared to what is seen in the financial sector. Yet they remain two major sectors that shape the lives and future of most Africans.


Some countries are however not letting down. An example is Cote d’Ivoire which is working on an African digital school initiative, a program that is designed to improve the quality of education, training and research in the country. Another example is Kenya which has established a national digital learning program in order to drive primary education.


In conclusion, while I agree that digital transformation may not be a panacea to all of Africa’s numerous challenges, I also believe that it needs to be given a lot of focus as a proven way to achieve scale in the continent.

Therefore, as we embark on infrastructural projects as a continent, the insights provided by digital technologies could prove very useful in ensuring that our scarce resources are rightly allocated to the areas in which there would be maximum impact.






https://www.itu.int/en/ITU-D/Regional Presence/ArabStates/Documents/events/2016/DigitalTransformation/Pres/Digital%20Transformation%20in%20Africa%2C%20Kefilwe%20Madingoane.pdf



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