BUSINESS BEYOND COVID
CATHY SMITH: Four key priorities for Africa’s tech firms in the time of Covid-19
Business leaders need to invest time and energy in imagining life and work post-pandemic
In the Business Beyond Covid series CEOs and other business leaders and experts in their sectors look to the future in the wake of the Covid-19 pandemic. What impact has the novel coronavirus and resulting lockdown had on their industries and SA economy as a whole, which parts will bounce back first, and which will never be the same again? Most importantly, they try to answer the question: where to from here?
It is becoming clear that most — if not all — of our major social, economic and political decisions over the next few years will be made through the prism of the coronavirus and the ripple effects of the Covid-19 pandemic.
Already the economic effects of lockdown can be felt as informal traders and small, medium and micro enterprises (SMME) grind to a halt due to government restrictions. The effects, while impossible to fully predict, are likely to reshape the future of the continent in fundamental ways.
While our current focus is on overcoming the immediate challenge posed by the virus, business leaders also need to invest time and energy in imagining life and work post-pandemic. In my own efforts to see past the Covid-19 crisis and consider what comes next, four key priorities emerge for tech businesses operating on the continent:
Supporting and accelerating SMME growth
Due to the digital skills divide and a number of other factors, most Africans are not actively working in the digital economy. The overwhelming majority of Africa’s citizens are informal traders, smallholder farmers and otherwise engaged in some form of entrepreneurship.
About 60% of Africa’s workforce are engaged in agriculture alone. The continent’s 250-million smallholder farmers, working on plots of about 2ha each on average and earning less than $1,000 per year, produce 80% of all food consumed here. A single smallholder farmer financially supports multiple family members and makes an invaluable contribution to food security. Any intervention that supports this sector has the potential to deliver dramatic socioeconomic returns.
We can see this in Nigeria, where an initiative by the Convention on Business Integrity’s for-profit arm, CBI Innovations, has seen the deployment of a technology tool to support 850,000 maize farmers and connect them more sustainably to the agricultural value chain.
Where countries have invested in building stronger agriculture sectors, the entire economy has been lifted. World Bank data shows that Ethiopia’s poverty levels dropped by a third since 2000 mainly thanks to impressive agricultural GDP growth of nearly 10% per year.
Engaging, inspiring and mobilising tomorrow’s workforce
Africa’s population growth has been on an accelerated path for some time. The latest data shows that the working age population in Africa — those aged between 25 and 64 years — is growing faster than other age groups, which provides an opportunity for accelerate economic growth, also known as the “demographic dividend”.
How we engage, mobilise and equip this demographic dividend in service of the continent’s socioeconomic goals will be instrumental in our collective effort to build a better future. Much of the developed world has been able to quickly shift learning to online platforms thanks to the pervasive high-speed internet connectivity and broad use of internet-enabled devices in those markets. In Africa, too many children simply don’t have that option.
Public- and private-sector organisations will need to build on the success that has been achieved over the past years to bring digital skills learning to more of the continent’s youth. Such efforts should focus not only on expanding access to technology among especially rural communities, but on equipping teachers and educators with the tools and knowledge they need to be effective digital learning champions.
The investments we make in training our youth today will pay huge dividends as we steer through the coming years and decades. And as populations age in more developed countries, the youth we train today may very well become the economic driving force of the future.
Removing (some) uncertainty from customers’ lives
In the immediate term, organisations will need to reconsider how they engage with their customers. We have seen how retail businesses are adapting to the pandemic by introducing social distancing measures in-store, ramping up sanitation and increasing their capacity for home delivery.
For technology businesses, these changes will be less visible to the average person, but no less important. With so much uncertainty, many organisations are looking for partners that can provide some much-needed insight to guide their decision-making.
Supply chain is one such area of uncertainty. How can technology be used to overcome shortages or disruption in the supply chain? How can we help companies find suppliers that can still deliver the goods they need? What tools do we have available to help balance supply and demand, especially in an environment as dynamic as our current one?
Commercial models also need to shift. Large-scale capital investment into new technologies is unlikely. Instead, tech companies should look at models that remove barriers to entry; for example, by offering solutions on a pay-as-you-go basis. Encouragingly, many tech companies are offering free versions of enterprise-grade software tools to help businesses large and small weather the immediate storm.
In many cases it will be these businesses’ first true adoption of such tools. As business leaders see the value that could be generated from technology, we may witness an accelerated process of digital transformation across African businesses and industries.
Establishing a more inclusive economy built on social impact
In the latest Global Entrepreneurship Monitor Women’s Report, Sub-Saharan Africa boasted the highest rate of female entrepreneurs at 21.8%. This against a global rate of 10.2% — in Europe, the rate drops to 6%. This means more than one in five women in Africa is engaged in some form of entrepreneurial activity.
Social entrepreneurship is also gaining ground as a more sustainable and broadly beneficial business model for addressing socioeconomic challenges on the continent. In 2019 Africa hosted the Social Entrepreneurship World Forum, first established in 2007, in Addis Ababa in Ethiopia. In that country alone 55,000 social enterprises have sprung up to address a wide spectrum of challenges. Surprisingly, more than a quarter of social entrepreneurs in the country are women, compared to only 4.5% who lead mainstream Ethiopian businesses.
It is this diversity and multiculturalism that gives us immense strength in innovation and resilience. Three thousand ethnic groups speaking more than 2,000 languages lend the continent an unmatched richness in perspectives and lived experiences.
As a greater share of our daily work output becomes automated by more efficient machines and algorithms, we’re likely to see a shift back to those skills and qualities that make us uniquely human. Empathy, creativity, compassion, the ability to consider and engage with a diverse set of views — these are the skills that will distinguish us as we head into the coming decades.
• Smith is MD at SAP Africa.
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