Robust ICT sector vital for digital economy | Fin24

Robust ICT sector vital for digital economy

Apr 11 2017 18:21

Johannesburg - If there’s one thing that South African businesses have become acutely aware of in recent years it is the importance of information and communications technology (ICT) in growing their revenues.

In the past five years, we have seen significant innovations across business sectors - from major banks who offer a wide variety of digital services to small business owners who are marketing their products on social media.

Now fibre is also being rolled out to homes and businesses across the country. However, while there has been phenomenal progress in South Africa’s ICT sector, there are still several challenges that must be addressed to ensure that our digital economy continues to grow, according to David Rozzio managing director of HP South Africa and Africa.

The computer era, coupled with printing, has only increased in popularity since its inception. How to constantly reinvent technology in South Africa has become a subject of public debate, he says.

HP South Africa takes the view that ICT is a key enabler to impact education and within (private and public sector) businesses, to improve and instil new business agility, reach new channels, and improve what they are capable of, through infinite connection capabilities that contribute to digital transformation.


"Education in South Africa has the potential to harness conceivable technology. To some extent, they already are. In many schools, students already do the leg work outside the classroom – researching, reading up on a subject or practising skills in their own time before the lesson begins," says Rozzio.

"This is the 'flipped classroom' in action – a blended learning that combines classroom teaching and online learning. And at school you have teachers - who can collaborate with students - engage them in group work with technology which mirrors the real world. That’s where the real magic happens."

He says in South Africa, arguably this new way of learning aims to provide and make education more flexible, collaborative and dynamic and perhaps, a large portion of state schools are yet to reap the rewards. Though HP South Africa affirms that the biggest factor in successful use of technology is the support offered to teachers (not to make them feel as if they’re being replaced by PCs and tablets), some 60% of teachers say they’d like more support and training on how to integrate technology to their teaching.

"Teachers need to feel empowered and part of the decision-making process, and in doing so, need to feel they understand how to use technology as well as, or better, than the students," says Rozzio.

"Some teachers are understandably wary of technology, while others are huge adopters. Some fear they’ll lose control, or that technology will be too great a distraction. But with the right tools and professional development – having teachers teach other teachers how to use it – is critical for success."

Digital transformation

He emphasises that technologies and services form a pivotal role in the race towards digital transformation, specifically, in computing, which has contributed significantly to the global digital economy. The digital economy refers to an economy based on digital computing technologies, or sometimes also referred to as the internet. It is intertwined with the traditional economy and can have widespread impact on a whole economy.  

"With globalisation, the world has seen countries trade and spread knowledge across landscapes resulting in economic sectors having strong influence as result of the digital economy. Per MIT Sloan Research, companies that are adapting to a digital world are 26% more profitable than their industry peers. Companies like Blackberry, were unable to adapt to the shape shifting digital economy," says Rozzio.

In South Africa, affordability and infrastructure are economic factors that are rated as showing signs of deterioration within the Network Readiness Index Report from the World Economic Forum Report of 2016. It is highlighted in the report that for South Africa to capitalise on venture capital investment in infrastructure there must be significant buy-in from government in the expansion of the ICT business environment – not only in word, but in action.

"As South Africa shifts towards digital trends it is proving to be the most important driver for innovation, competitiveness and growth. Moreover, it holds huge potential for radically changing business landscapes and shaping the nature of work. These trends spur innovation in business models, transfer of knowledge and networking capabilities," says Rozzio.

Powering growth

ICT has also allowed for SMEs to take full advantage of opportunities in powering growth and creating jobs by establishing avenues of reaching foreign markets and potential business partners. Merely by engaging with customers online, SMEs in Europe have experienced a sales growth rate up to 22% higher than the last three years versus countries with little to no internet penetration - in South Africa the picture isn’t quite the same.

"South Africa has yet to understand how important ICT is in creating a hub for SMEs to propel their worth. Within the digital economy there is ample opportunity to transform and modernise many industries simply by improving productivity, sustainability and competitiveness. There are, however, only a few who are privy to such knowledge and are pioneering this space," says Rozzio.

"Serial entrepreneurs like Alan Knott Craig Jr are making strides in wanting to provide ICT capability to all South Africans through his NGO known as Project Isizwe. In this case, learners can use the facility to conduct research for school or having general access to empower them to enrich their own minds and lives – this has proven to be a great success for the organisation."


In the digital age, ICT infrastructure plays a pivotal role in enabling economic growth through increased economic activity, innovation and productivity - a strong message to instil within a developing ICT culture.

"The digital divide that plagues developing countries such as South Africa will need attention for a variety of reasons. Nevertheless, this access requires money, or in this instance data – a grudge purchase for many South Africans. Recently social commentary and activists have expressed their displeasure towards data charges, colloquially known by social media reference as Data Must Fall, and the fight here is far from over," says Rozzio.

"Luckily, there have been some positive first steps in managing the issue of data and access through a government-led initiative known as the Wireless Open Access Network (OAN). This policy recommends that a public-private owned and managed consortium, consisting of entities that are interested in participating, such as electronic communications services, infrastructure companies, private equity investors, SMEs and internet service providers, is formed to ensure that ICT services are available to more people."

Millions of users

As millions of digital users spend time looking to discover more and more what those in the forefront of technology can offer, the new possibilities for South Africa’s technology mix, are premised on an integrated pool of mega-trends such as, cloud, mobile, social, and big data, in his view. All these elements are changing the game for business, work, and life, along with IoT (Internet of Things) the mega-trend of mega-trends.

"These are all positive, vibrant ways to think about technology in South Africa and to welcome change to the usual negative narratives we hear about. Our optimism, however, should be tempered. Advocates need to be in the form of empowered influencers, who can do much more to promote business activities in science, technology and innovation," says Rozzio.

"They can foster the creation of an environment where entrepreneurs can grow their small and medium–size sized companies, improve access to capital and help establish international partnerships."

This is the current state of the IT-related discussion which South Africans are struggling to grasp, in his view.

"It will take a new political will from government to improve its talk-ability among all citizens. Amid socio-economic issues that inhibit the progression of many South African’s, the Gauteng provincial government has recognised that it needs to play a key role in the deployment and use of ICT to deliver the promise of critical services, including quality education," he says.

The National Integrated ICT Policy White Paper talks about radical transformation of the industry to diversify participation by SMMEs, black, youth and female enterprises. The White Paper makes mention of exploring the role of technologies in meeting critical goals in the National Development Plan.

"The question we have ask ourselves, a sentiment strongly mentioned by Vuyani Jarana, chief officer of Vodacom Business at GovTech 2016, is whether South Africa and the African continent will be ready to embrace the digital economy as it’s fast becoming the trend of a new economy driven by robust ICT measures," concludes Rozzio.

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