Technological advancement is fundamental for economic development. The more accessible the tech is for citizens, the more rapidly the local economy can progress. In South Africa, a commitment to embrace the “fourth industrial revolution” has been a fixture of national government rhetoric for several years. At a provincial level, meanwhile, the Western Cape has been able to leverage the “Silicon Cape” tag to build a thriving startup culture and attract international tech companies.
But technology can also help stimulate micro economies by making businesses more efficient and productive, assisting entrepreneurs to get off the ground with minimal resources, and empowering communities. Embracing technology at the microeconomic level can help reduce inequality and build wealth in areas where it’s needed the most, ultimately contributing to macroeconomic growth.
Growing small businesses
The most obvious area where technology can have a significant micro economic impact is among small businesses. That’s especially important in a market like South Africa, where small and micro enterprises make up 98% of formal businesses and employ between 50 and 60 percent of the country’s workforce.
In addition to providing jobs, these SMEs can help build the communities they operate in by providing opportunities for local talent and even attract other businesses to the area. With the help of technology, these businesses can automate tasks like inventory management, gain real time business intelligence, and leverage e-commerce tools to expand their reach. Through this, small business owners can free up time to focus on doing what they love most. At Zoho, we focus on serving the underserved—and that includes smaller businesses in geographies that are often ignored. That’s why we invest more in R&D and keep our technology affordable.
Fostering entrepreneurship through low-code
Low- and no-code tools can help entrepreneurs easily build applications with minimal need for expensive developer resources. Low-code platforms offer a graphic development environment—and because these platforms use snippets of pre-written code or drag-and-drop blocks, entrepreneurs can build and test their applications far quicker than would otherwise be the case. Additionally, because low-code platforms eliminate some of the more complex parts of the application development process (such as creating frameworks and linking databases), it becomes easier and faster for entrepreneurs to take their solution to market.
As long as they have access to the Internet, a startup can function from anywhere. By opening their offices in small towns or rural areas, they can reduce their operational costs significantly, thereby gaining longer runway to operate. They can also create opportunities for local talent and prevent them from leaving their hometowns to search for jobs in metros (a phenomenon that can be compared to top-soil erosion). When smart and talented youth choose to stay, they can find solutions to local problems and empower local communities.
From afar, the positive shifts that technology brings to individual businesses, entrepreneurs, and community organisations may seem small. But over time, they can start to have big cumulative effects. With enough momentum, these effects can ripple from the community to the municipal, provincial, and even national levels.
So, while there should always be scrutiny around national macroeconomic policies, the impact that technology can have at the microeconomic level should never be underestimated.
By Andrew Bourne, Regional Manager, Zoho