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Non-profits falling behind in digital era

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Despite 98% of non-profits indicating that technology is very important to their operations, the sector still faces challenges to its digital transformation, compared to other industries, writes SIYA MADYIBI, Head of Corporate, External and Legal Affairs at Microsoft SA.

According to a recent survey conducted by Microsoft polling NGOs across South Africa, which found that the non-profit sector is fast having to play catch-up when it comes to fully embracing digital transformation.

Out of the 55 non-profits surveyed, only 12 said that 80 percent of their employees and field workers have access to devices, and 16 reported that their field workers are using technology to better serve their cause.

A lack of funding and poor internet connection were cited as the biggest barriers to adoption. Several respondents indicated that there was often an internal belief that technology is too expensive and they face challenges regarding weak team structures and collaboration, and restricted funding models.

Why non-profits need to digitally transform

Non-profits operate in much the same way as do big businesses and enterprise. Each tries to maximise a return on investment of often limited resources in order to satisfy the objectives of various stakeholders or customers.

Just as successful enterprises must constantly innovate to meet and shape customer preferences, so too do non-profits need to adapt to meet the demands of today’s digital world. Finding new and innovative ways to reach customers and shareholders, or beneficiaries and donors, is one area that both enterprises and non-profits respectively share.

In the survey, non-profits indicated that technologies like cloud computing can help them keep detailed databases of their beneficiaries, update records easily, search for records faster and back up information on servers that are not on their premises. Other respondents reported that they use mobile technology to capture and share pictures and reports for evidence of implementation. This allows their team to share progress with funders, opening doors for more funding.

Overcoming the obstacles

Organisations that are agile enough to effectively adapt will be well positioned for the future; those who aren’t, risk becoming redundant as new models emerge that better serve beneficiaries and match donor interests.

Rise the connected non-profit

Here’s how non-profits can digitally transform their organisations:

1.     Become a digital-first organisation

A digital-first organisation is one that embraces technology across business functions, rather than treating IT as a separate department.  It must become a culture that flows from top managers to all levels of the organisation, not just the IT department.

2.    Choose the right tools for the job

Traditionally non-profits have used a variety of disparate technologies to store, manage and analyse data. However, the emergence of cloud computing has unlocked a vital resource for addressing the world’s problems. Cloud services utilise data to create new insights and lead to breakthroughs, not just for science and technology, but for addressing the full range of economic and social challenges and the delivery of better human services. Cloud also improves communications and productivity, and is much more cost-effective than traditional software.

3.    All staff need to become digital staff

The reality is that digital intersects the work of all staff in any organisation. Non-profits need to create digitally-savvy, mobile workforces who are well equipped to flourish in a mobile-first, cloud-first world. They can do this by arming staff and field workers with adequate devices and equipping them with the necessary skills to serve the broader needs of the non-profit community and the beneficiaries they service.

At Microsoft we are committed to helping non-profits use cloud computing to solve basic human challenges. One of our ambitions for Microsoft Philanthropies is to partner with these groups and ensure that cloud computing is accessible to a greater number of people and meets the widest range of societal needs.

This is why Microsoft recently announced that it will be making Microsoft Azure available to eligible non-profit and non-governmental organisations, by offering Azure credits. This offer adds to the existing comprehensive suite of Microsoft cloud services that are available to non-profits to empower their missions.

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Online retail gets real

After decades of experience in selling online, retailers still seek out the secret of reaching the digital consumer, writes ARTHUR GOLDSTUCK.

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It’s been 23 years since the first pizza and the first bunch of flowers was sold online. One would think, after all this time, that retailers would know exactly what works, and exactly how the digital consumer thinks.

Yet, in shopping-mad South Africa, only 4% of adults regularly shop online. One could blame high data costs, low levels of tech-savviness, or lack of trust. However, that doesn’t explain why a population where more than a quarter of people have a debit or credit card and almost 40% of people use the Internet is staying away.

The new Online Retail in South Africa 2019 study, conducted by World Wide Worx with the support of Visa and Platinum Seed, reveals that growth is in fact healthy, but is still coming off a low base. This year, the total sale of retail products online is expected to pass the R14-billion mark, making up 1.4% of total retail.

This figure represents 25% growth over 2017, and comes after the same rate of growth was seen in 2017. At this rate, it is clear that online retail is going mainstream, driven by aggressive marketing, and new shopping channels like mobile shopping. 

But it is equally clear that not all retailers are getting it right. According to the study, the unwillingness of business to reinvest revenue in developing their online presence is one of the main barriers to long-term success. Only one in five companies surveyed invested more than 20% of their online turnover back into their online store. Over half invested less than 10% back.

On the surface, the industry looks healthy, as a surprisingly high 71% of online retailers surveyed say they are profitable. But this brings to mind the early days of Amazon.com, in 1996, when founder Jeff Bezos was asked when it would become profitable.

He declared that it would not be profitable for at least another five years. And if it did, he said, it would be in big trouble. He meant that it was so important for long-term sustainability that Amazon reinvest all its revenues in customer systems, that it could not afford to look for short-term profits.

According to the South African study, the single most critical factor in the success of online retail activities is customer service. A vast majority, 98% of respondents, regarded it as important. This positions customer service as the very heart of online retail. For Amazon, investment back into systems that would streamline customer service became the key to the world’s digital wallets.

In South Africa online still make up a small proportion of overall retail, but for the first time we see the promise of a broader range of businesses in terms of category, size, turnover and employee numbers. This is a sign that our local market is beginning to mature. 

Clothing and apparel is the fastest growing sector, but is also the sector with the highest turnover of businesses. It illustrates the dangers of a low barrier to entry: the survival rate of online stores in this sector is probably directly opposite to the ease of setting up an online apparel store.

A fast-growing category that was fairly low on the agenda in the past, alcohol, tobacco and vaping, has benefited from the increased online supply of vapes, juices and accessories. It also suggests that smoking bans, and the change in the legal status of marijuana during the survey, may have boosted demand. 

In the coming weeks, we can expect online retail to fall under the spotlight as never before. Black Friday, a shopping tradition imported “wholesale” from the United States, is expected to become the biggest online shopping day of the year in South Africa, as it is in the USA.

Initially, it was just a gimmick in South Africa, attempting to cash in on what was a purely American tradition of insane sales on the Friday after Thanksgiving Day, which occurs on the third Thursday of November every year. It is followed by Cyber Monday, making the entire weekend one of major promotions and great bargains.

It has grown every year in South Africa since its first introduction about six years ago, and last year it broke into the mainstream, with numerous high profile retailers embracing it, and many consumers experiencing it for the first time. 

It is now positioned as the prime bargain day of the year for consumers, and many wait in anticipation for it, as they do in the USA. Along with Cyber Monday, it provides an excuse for retailers to go all out in their marketing, and for consumers to storm the display shelves or web pages. South African shoppers, clearly, are easily enticed by bargains.

Word of mouth around Black Friday has also grown massively in the past two years, driven by both media and shoppers who have found ridiculous bargains. As news spreads that the most ridiculous of the bargains are to be had online, even those who were reticent of digital shopping will be tempted to convert.

The Online Retail in SA 2019 report has shown over the years that, as people become more experienced in using the Internet, their propensity to shop online increases. This is part of the World Wide Worx model known as the Digital Participation Curve. The key missing factor in the Curve is that most retailers do not know how to convert that propensity into actual online shopping behaviour. Black Friday will be one of the keys to conversion.

Carry on reading to find out about the online retailers of the year.

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Reliable satellite Internet?

MzansiSat, a satellite-Internet business, aims to beam Internet connections to places in South Africa which don’t have access to cabled and mobile network infrastructure, writes BRYAN TURNER.

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Stellenbosch-based MzansiSat promises to provide cheap wholesale Internet to Internet Service Providers for as little as R25 per Gigabyte. Providers who offer more expensive Internet services could benefit greatly from partnering with MzansiSat, says the company. 

“Using MzansiSat, we hope that we can carry over cost-savings benefits to the consumer,” says Victor Stephanopoli, MzansiSat chief operating officer.

The company, which has been spun off from StellSat, has been looking to increase its investor portfolio while it waits for spectrum approval. The additional investment will allow MzansiSat’s satellite to operate in more regions across Africa.

The MzansiSat satellite is being built by Thales Alenia Space, a French company which is also acting as technical partner to MzansiSat. In addition to building the satellite, Thales Alenia Space will also be assisting MzansiSat in coordinating the launch. The company intends to launch the satellite into the 56°E orbital slot in a geostationary orbit, which enables communication almost anywhere in Africa. The launch is expected to happen in 2022. 

The satellite will have 76 transponders, 48 of which will be Ku-band and 28 C-band. Ku-band is all about high-speed performance, while C-band deals with weather-resistance. The design intention is for customers of MzansiSat to choose between very cheap, reliable data and very fast, power-efficient data. 

C-band is an older technology, which makes bandwidth cheaper and almost never affected by rain but requires bigger dishes and slower bandwidth compared to Ku-band connections. On the other hand, Ku-band is faster, experiences less microwave interference, and requires less power to run – but is less reliable with bad weather conditions.

MzansiSat’s potential military applications are significant, due to the nature of the military being mobile and possibly in remote areas without connectivity.  Connectivity everywhere would be potentially be life-saving.

Consumers in remote areas will benefit, even though satellite is higher in latency than fibre and LTE connections. While this level of latency is high (a fifth of a second in theory), satellite connections are still adequate for browsing the Internet and watching online content. 

The Internet of Things (IoT) may see the benefits of satellite Internet before consumers do. The applications of IoT in agriculture are vast, from hydration sensors to soil nutrient testers, and can be realised with an Internet connection which is available in a remote area.

Stephanopoli says that e-learning in remote areas can also benefit from MzansiSat’s presence, as many school resources are becoming readily available online. 

“Through our network, the learning experience can be beamed into classrooms across the country to substitute or complement local resources within the South African schooling system.”

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