The CIO, Information Technology and Africapitalism: Creating a Better Future for Africa
Whilst all eyes are, rightfully, on Africa as the next big economic growth story it is vitally important to ensure that this growth benefits all Africans and not just a select few. What is needed is a new form of capitalism; some would call it Africapitalism, others Capitalism 3.0 or Social Capitalism. Regardless of the label there is no doubt that a new, more inclusive, transparent and sustainable approach to both government and business is needed if we are to see Africa’s bounty being more equitably exploited. Neither the rampant greed, financial chicanery and lack of governance that led to the 2008 global financial meltdown,
nor the corruption, nepotism and rent-seeking that characterise the older generation of Africa’s political economy will ensure a successful future for current and yet-to-be-born Africans.
This might seem like an unusual topic for a CIO (whether public or private sector) to be contemplating but it shouldn’t be – especially in Africa. In the post-Industrial epoch where old business models are being demolished by the forces of digitisation, where new ways of communing and collaborating are made possible and where technology-led innovation holds the key to growth and competitive capabilities, Information and Communication Technologies are going to be as vital as electricity, sanitation, roads and rail and clean water to ensuring Africa can command the high ground of the global economy.
The recent past holds some instructive lessons when it comes to the role of technology (for good or bad depending on your point of view) and vividly illustrates how African CIOs can leverage technology to create a better life for all. Here are a couple of examples.
If you are an African government with too many self-aggrandizing, corrupt, rent-seeking, dictatorial kleptocrats your government can be swiftly brought to its knees by the concerted actions of civil society – their efforts coordinated and amplified through social media and mobile access (Tunisia and Egypt being just two examples). Or, you can choose to use technology to operate more efficiently and transparently and to get closer to your citizens by delivering better services more quickly.
If you are an African innovator you can leverage mobile technology build a financial system that bypasses the conventional banking system, creates huge value for more than 66% of your country’s adult population (the vast majority of whom were previously unbanked) and captures around 25 % of your domestic market’s Gross National Product (GNP) as has been the case in Kenya with Safaricomm’s M-Pesa mobile money system.
Or, you may be a conventional, full-service bank looking for a better way to capture the “unbanked” market without the incurring the costs of building and operating branches in unserved areas. This is what Standard Bank South Africa (the country’s biggest banking group) has done. By integrating SAP CRM, SAP Banking Services and SAP Mobile Platform it is now able to open fully compliant accounts, anywhere in South Africa where there is a mobile network, in minutes. It is not only capturing market share but more importantly it is bringing people into the mainstream economy where they can now participate more fully.
Or, as is the case with the Mara Group and Mara Foundation you can recognise that Africa has some unique advantages in terms of labour costs, a youthful workforce, language and time zone affinity with Europes and that you can leverage technology to provide Business Process Outsourcing and Call Center services to Europe whilst also contributing in a big way to skills development in Africa.
Or, you may be a small retailer, like Nano Appliance Centre in Zimbabwe where, by leveraging SAP BusinessOne in the Cloud (from a local partner called
Cumulus) you are able to grow the number of stores despite tough trading conditions, optimise your inventory, understand your customers more deeply and
improve staff morale by calculating commissions more rapidly and accurately.
These are just a few examples of how technology is changing the economic landscape of Africa; there are many more and the potential to help Africa RUN BETTER through technology is enormous. Here are a few thoughts on how SAP’s solutions can be applied to effect change for the better:
A quick glance at Transparency International’s index shows that too many African countries languish at the bottom of the tables when it comes to perceptions of corruption. These are perceptions that governments and businesses need to change if Africa is to attract (and keep) investment, trading partners and talent. SAP offers an array of possibilities in this regard ranging from an SAP ERP system being used to embed good policies in automated business processes, to SAP GRC Access Control being used to ensure correct separation of duties, to Disclosure Management quickly and accurately publishing financial results to Real-time Fraud detection using Predictive Analytics and the power of In-memory computing.
If you are a government you will want to ensure that you are collecting the revenues due to your citizens from a wide variety of stakeholders and applying them for the public good. The Extractive Industries Transparency Initiative (EITI) sets a global standard for transparency in oil, gas and mining. It is a coalition between governments, companies and civil society working together in an effort to make natural resources benefit all. It is a standard for companies to publish what they pay and governments to disclose what they receive. EITI requires the gathering, analysis and dissemination of information and therefore
needs systematic support.
In Africa, SAP has empowered the Ghanaian government’s compliance with the Extractive Industries Transparency Index with a proven and flexible solution (based on SAP Enterprise Performance Management) that enables the elimination of most of the paperwork and keeps track of payments and revenues
through a centrally managed system. The solution was collaboratively developed in Africa with members of the EITI. It provides extensive functionality for identifying discrepancies and reporting on payments at local, regional and national level. EITI Compliance with SAP gives governments and corporations the transparency that is a prerequisite for good governance and economic and social progress in resource-rich countries and is a great example of how a CIO can use technology to create significant societal impact.
If you look at the GINI Coefficient of African countries you will often see a fairly dismal picture depicting some of the most unequal societies on earth. High levels of GDP Growth are not translating into a better life for all but, too often, extraordinary privilege for the connected few. Africa has to find ways bring more people into the economic mix. Again, SAP can help in many ways and on many fronts. For an established company it may be extending the reach of existing systems and empowering your own staff, customers and suppliers better by leveraging new user experiences such as SAP FIORI and / or the SAP Mobile Platform (such as Standard Bank have done).
For companies of all sizes looking to expand it may be by joining the SAP ARIBA Network where, as a supplier you gain access to the world’s largest B2B eCommerce platform and expose yourself to the world’s biggest buyers.
Or, in the micro-enterprise space it may be that you need to run your small business better but cannot afford more than a feature phone; SAP’s BiYP (Business-in-Your-Pocket) is an innovative prototype, to be commercialised soon, that is designed for just this eventuality and takes cognisance of the realities of affordability in the informal sectors of the African economy.
The rest of the world is looking hungrily at the abundance of Africa’s resources. These range from minerals such as platinum, gold and copper to oil and gas to arable land and agricultural products to, latterly, sunshine and big rivers as a source of renewable energy. The reality is that most of these resources are finite and will need exemplary stewardship to ensure their value is optimised. For Africa to truly benefit, many of them will need to be beneficiated in Africa implying the need for world-class manufacturing and logistics systems. This is a domain that SAP excels in and one in which the company brings huge value to African enterprises. An important facet of sustainability is the ability to run a highly efficient enterprise; consuming the least amount of resources for any given unit of output. This is not possible without automation and the adoption of best practice based business processes. These are both areas where SAP, as the global leader in process automation and innovation, can quickly help African organisations to become world class.
The continent of Africa already has over 1 billion inhabitants. Of these, slightly more than 50% are under 19. Given current demographic trends Africa will have 1.9 billion people by 2050 and Nigeria alone will come close to outstripping China’s population. Assuming a more inclusive approach to economic development, sustained investment in infrastructure, widespread skills development, higher levels of natural resource beneficiation, good governance and continued growth of a burgeoning middle class, Africa thus represents an exciting growth market.
Capturing that growth, especially for indigenous companies will require higher levels of insight, efficiency and innovation than typically exist today along with an ability to execute that can counter fierce global competition. It cannot be done without a vastly simplified, scalable and flexible information technology architecture. Here SAP’s ground breaking HANA platform together with the Applications and Analytics that run on it offer African organisations the opportunity to leapfrog their counterparts in developed economies who are weighed down by decades of legacy IT and integration
The African CIO’s time is now
These are exciting times to be a CIO in Africa, contemplating the future of your enterprise and contributing to its transformation and in turn a better life for Africans across this amazing continent. They require you to step up to the plate and to use technology to simplify everything so that your organisation can do anything.
If you are an African CIO wanting to learn more about how to make an impact, join us at the SAP Africa CIO Summit in Marrakesh. 7th to 9th May 2014. The world’s leading Business Software Company and an exemplar of innovation, SAP, brings you an agenda designed to help you learn, network, enhance your leadership capabilities and ensure your on-going success.
If you are interested in reading more about this event, kindly go to: SAP Africa CIO Summit. Marrakesh. 7 – 9 May 2014