Digital Transformation’s Impact on Businesses within South Africa

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Digital transformation is changing the ways businesses operate throughout the world. New technologies like cloud computing, artificial intelligence (AI), machine learning, and predictive analytics, already have had a profound impact on the world’s economies and continue to disrupt industries.

Recognising this potential, government strategies today are emphasizing the role of digital in accelerating economic diversification, promoting sustainability and ensuring citizen happiness. Digitalization has been identified as a pillar that will support the future digital economies on the continent.

By placing new digital and ICT transformation programs at the heart of their national plans and through collaborations with leaders and entrepreneurs committed to building a better future, governments across the region are already leading the way in securing a viable future for their citizens while also raising their national competitiveness profile at a global level.

Within South Africa, The National Development Plan 2030 (NDP) published in 2012 emphasizes how ICT will underpin the development of a connected information society and a vibrant knowledge economy that is more inclusive and prosperous.


Similarly, the Government of Morocco introduced the Morocco Digital 2020 strategy, a set of policies and reforms which promote the effective use of and access to technology in various sectors to position the country as a digital economy.

Nigeria has also taken significant steps to drive economic transformation, sustainability and future skills development through technology.

Businesses reaping the benefits of 4IR

Digitisation spurs the development of new industries as in the case of e-commerce, mobile financial services, IoT, and cloud computing. These contribute to national GDP in multiple ways while also promoting growth of allied industries such as logistics, infrastructure, and payments. These opportunities are not only limited to the ICT industry, but also disrupts traditional industries to unlock speed, lower costs, and ensure higher quality.

While many businesses are fuelled by competition and adopting new and disrupted forms of technology, many organisations are still using legacy IT and have shied away from digital transformation. Digital transformation essentially involves a fundamental change in how an enterprise uses its technology, its workforce and business processes to improve its performance and value to customers. 

While businesses can gain massive value opportunities in these areas, companies undertaking these efforts quickly learn that the technology in digital transformation is often the easiest part of the change. Development gains from digital transformation are not automatic and can result in new divides and widen inequalities.

Building internet infrastructure and digital skills

A major obstacle to the development of internet infrastructure within Africa is a lack of experienced network engineers. Without these engineers, national internet investment, policy and regulatory decisions may lack the technical foundation that will ensure an open, affordable, scalable internet.

If South Africa had the required mass of network engineers who are able to shape the future of network infrastructure at both a local and national level, businesses and organisations would be able to unlock their full potential and fully utilize Fourth Industrial Revolution (4IR) technologies, like the Internet of Things (IoT), artificial intelligence, blockchain technology and big data.

Knowledge building and future-ready curricula 

Apart from access to affordable connectivity and devices, there is also a need to digitally upskill people to operate or work with the advanced and/or emerging technology in 4IR. Investments in human development and digital skills are necessary to build a pipeline of future talent that can embrace this dynamic and increasingly digitised environment. This will require a massive educational overhaul that addresses basic education backlogs at all levels, from basic to tertiary education.

The World Economic Forum has highlighted the importance of African educators to design future-ready curricula that accelerate the acquisition of digital and STEM skills to match the way people will work. African governments, with the help of private sector stakeholders, have an opportunity to develop tailored approaches to understanding the region’s evolving skills base and emerging jobs scenarios. The need for schooling and re-tooling of the African labour force to find occupations less susceptible to automation, needs more recognition.

To take advantage of what 4IR has to offer business, governments must be able to develop, attract and retain the skills and capabilities. Ministries of Education need to re-think how skills can be obtained. Governments and communities need to take a fresh look at how they develop emerging technology skills and knowledge.

Where SA can grow 

South Africa can become a technology hub within the region, by applying new technologies in various sectors where it has a traditional advantage over its neighbours. These include mining, agriculture and financial services. A successful example of this would be South Africa’s Mining Sector, which has been transformed with the incorporation of sensors and devices into equipment and machinery within an IoT network allowing for the speedier analysis of data and increased efficiency.

Winning in the digital economy requires a combination of technical understanding, pioneering leadership, and a sense of vision and determination to encourage an ecosystem of innovation. Leaders who engage with these possibilities today could be reshaping the economy of 2030 for the greater good.

By Deirdre Fryer, Head of Solutions Engineering at SYSPRO Africa