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Africa must take charge of its digital destiny

By CATHY SMITH, managing director at SAP Africa

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Does 2020 mark the year Africa steps into its stride and takes charge of its destiny in the 21st century? 

While we’re still dealing with the disruptive events of this year, I would argue that Africa’s moment has finally come. How we act over the coming months will echo across a generation. Take the correct steps now, and we could unlock the continent’s vast potential. Miss the opportunity, and we could see ongoing instability and lack of prospects for millions.

It won’t be easy. Our challenges are immense, and have only been intensified by this year’s events.

The pandemic has accelerated some of the social, economic and political changes that emerged from the 2008 global financial crisis. According to Deloitte, there remains a growing frustration with organisations that focus only on generating profits without addressing social problems, aiding political stability and mitigating the unintended consequences of the technologies they develop. 

This has created a lack of trust between the public and the institutions that are meant to serve them. The pandemic has worsened the situation by further polarising people along political and social lines. It is not a stretch to say public trust is at historic lows.

Transforming leadership and business

And yet, we need to collaborate and work together to repair the damage wrought by the events of 2020. 

This may require a new form of leadership, one that acknowledges the interconnectedness of purpose and profit, and turn purpose into a core thread of the organisational fabric. It requires greater collaboration between the private sector, government, social enterprises and NGOs. 

And it requires a total transformation in how we build, run and manage our businesses. 

How can organisations reimagine themselves to fit into this wildly different world? 

Companies that prioritised digital transformation before this year’s lockdowns were implemented had a chance at navigating the stormy seas of 2020. Those that hadn’t have been left adrift as constant change and widespread disruption end the prospect of business-as-usual.

Digital transformation a ‘survival tool’

Today, digital transformation simply means one thing: survival. 

Organisations need access to new tools and technologies to deal with new challenges and opportunities emerging from a constantly-changing business environment. 

Looking ahead, organisations will need to approach digital transformation in new ways. All leaders and executives should be well-versed in the language of technology and understand its impact on the organisation. There’s no such thing as a business strategy or an IT strategy: they are one and the same.

It’s not up to IT to tell the organisation where to prioritise its digital transformation next. These decisions will shape the future of the organisation, and should be approached from a business strategy perspective. 

What new markets do we want to unlock? What new customers do we want to find? What new services do we want to introduce to the market? And, importantly, what role does technology play in enabling all of this?

Growing skills crisis

We need to radically transform our approach to skills development and employment. Youth unemployment could quickly become a crisis to rival that of the pandemic. Africa introduces ten to twelve million youth into the labour force per year, but only produces three million new formal job opportunities.

According to the International Labour Organisation, 95% of youth employment on the continent is informal. In South Africa, youth unemployment is at the worst levels of anywhere in the world. Fifty-eight percent of youth are not in jobs, education or training. This is an unfolding tragedy beyond compare.

New partnerships need to be established to fast-track digital skills development among our youth, or we risk widespread social instability. Africa has the largest and fastest-growing youth population in the world. We are the envy of developed nations where population growth has plateaued, creating skills shortages in many countries. 

Our current approaches are not working. The private sector needs to step up by expanding skills development and job creation opportunities to allow more of our youth to access formal employment. We need to work closely with our public sector partners and each other to ensure we mobilise the continent’s vast and largely untapped human capital resources.

Unlocking social enterprise potential

We need to transform how the private sector procures goods and services. Corporate procurement networks command trillions of dollars in buying power – just the commerce value on SAP’s global Ariba network alone totals $3.46-trillion a year. 

Allocating even one percent of that procurement spend to social enterprises could make a tremendous impact on unemployment, especially among the continent’s youth.

In line with that, we need to enhance our support of social enterprises, and we need to make this a core and sustainable part of our business strategy. In the UK, social enterprises account for £60-billion of the economy, contributing 3% of its GDP and 5% of its employment. In France, this jumps to 8% GDP and more than 10% of employment.

Unlocking even a fraction of that potential could have huge positive impact for millions in Africa. There’s no shortage of social enterprises to support – it’s up to us, the private sector, to identify and support suitable social enterprises and fulfil our duty of purpose over profit. 

We face a tremendous challenge over the coming months and years as we repair the damage wrought by the 2020 pandemic. But our challenges are not insurmountable. By transforming how we conduct business, by prioritising skills development, and by unlocking the vast potential of purpose-driven businesses and social enterprises, 2020 could become a catalyst for Africa’s success and growth.

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