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Picture: 123RF/TAKASHI HONMA
Picture: 123RF/TAKASHI HONMA

The dichotomy of purpose and profit is becoming increasingly important and a source of differentiation for many organisations. There is a greater possibility that successful organisations of the future will not only be those that strike a balance between these two important concepts but excel at “humanising” their businesses through integrating and collaborating closely within and beyond their ecosystem to deliver more meaningful solutions to their customers. This approach also helps fuel innovation.

Africa’s financial landscape is undergoing a dynamic transformation, driven by a deeply human desire: connectedness. We all have a fundamental need for belonging and social connection. This desire is fuelling a revolution in Africa’s financial landscape, where companies are finding innovative ways to connect people and empower them financially.

As companies strive to remain relevant and impactful, addressing these real human needs becomes imperative. According to Harvard Business School professor Rebecca Henderson, most of the companies tackling the world’s biggest challenges are purpose driven. Companies such as Patagonia lead the way by demonstrating bold commitments to sustainability and environmental activism. However, purpose can manifest differently for different organisations.

Within the African context, where critical needs like financial inclusion and bridging the digital divide persist, there’s a pressing need to move beyond traditional ecosystems.

Traditionally, organisations have focused on specialised services or products, often viewing external players as competitors. This inward-looking approach can sometimes hinder collaboration and limit the potential for broader impact. However, a new paradigm is emerging where consumer-centric companies recognise that purpose is paramount. They understand that designing personalised products and services that prioritise the human element and meaningfully enhance people’s lives is not just good for society but also good for business.

This customer-centric approach mirrors the broader trend of companies transforming into “ecosystem players”, expanding beyond their traditional industries to meet a broader spectrum of human needs. Initially, these ecosystem players often focused on offerings that leveraged their core strengths and existing capabilities, such as e-commerce platforms expanding into digital payments.

However, as they grow and mature, many ecosystem players are now expanding into new territories and exploring new markets and opportunities. This evolutionary process has led to the emergence of powerful conglomerates such as Amazon, Apple, Google and Alibaba, demonstrating the potential for long-term success through strategic expansion.

Within the African context, where critical needs like financial inclusion and bridging the digital divide persist, there’s a pressing need to move beyond traditional ecosystems. We must emulate the very nature of human connectedness through increased integration across industries to collectively innovate and provide solutions for our people and the planet — beyond profit. This requires a mindset shift, one that seeks to collaborate and partner for the greater good as opposed to strict shareholder value maximisation.

Africa has a population of 1.3-billion today and, according to UN figures, is poised to grow to 1.7-billion by 2030 and 2.5-billion by 2050 — double what it is today. We are already a continent teeming with youthful energy and untapped potential, boasting the world’s youngest population, with more than 60% under the age of 25.

This youthful population presents both a challenge and an opportunity for Africa’s future. If the Global South, with Africa at its heart, is to drive global progress and address social challenges such as youth unemployment and infrastructure development, innovative approaches to connectedness, coexistence and co-operation across sectors, industries and interests will be essential.

Today, African economies are largely driven by small businesses, with SMEs accounting for 40%-50% of emerging economies and up to 80%-90% of employment in some regions, according to the World Bank in 2023. However, the growth of these SMEs is often restricted by insufficient access to finance or infrastructure for scale. Partnerships are critical in fuelling the necessary innovation to solve societal challenges, improve the livelihoods of customers and drive economic growth. These partnerships can take various forms, but the central ingredient is the deliberate leveraging of cross-industry strengths and expertise across verticals to create a connected society and address planetary issues.

This requires big businesses to intentionally seek opportunities for collaboration to enhance the quality of life for the customers they serve. Fortunately, such collaborations are already emerging across industries, with banks, technology companies and telecom companies making inroads through sector-agnostic partnerships and fintech collaborations.

These efforts are solving issues related to agricultural productivity, sustainable and clean energy, logistics and financial inclusion. An example is the partnership between IBM and Hello Tractor, which connects farmers and facilitates a digital wallet, allowing access to and sharing of farming equipment via a lending model. This model uses internet of things-driven software to turn regular equipment or tractors into “smart tractors”. The app-driven solution has led to significant boosts in farmers’ income and job creation, contributing to economic upliftment and food security across Africa, increasing yields and improving crop quality while also reducing labour and time costs.

By moving beyond traditional industry boundaries and fostering partnerships that leverage cross-industry strengths to deliver purpose-driven solutions that meet the critical needs of their customers, African organisations can unlock immense potential for innovation.

This new mindset of “co-opetition” (co-operation and competition), with companies collaborating even as they compete, requires a shift from solely maximising shareholder value to creating shared value for all stakeholders, including customers, communities and the environment. Such a shift will be a defining characteristic of future innovative companies.

Embracing this model, Africa’s youthful and entrepreneurial population is uniquely positioned to spearhead this collaborative movement and pioneer new approaches to solving problems for the greater good.

• Dutuma is a strategy and banking executive and board adviser.

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