[Column] Hardeep Sound: Cloud, innovation key to East Africa's economic growth
05-12-2022 12:59:00 | by: Nixon Kanali | hits: 3326 | Tags:

When the early days of the pandemic pushed industries across East Africa into survival mode, it sparked a wave of cloud adoption that has swept through the region. 

Focused at first on ensuring business continuity, investment into cloud technologies and digitalisation has since helped organisations in the region build greater resilience and unlock new business models and revenue streams. 

Even the most reluctant businesses and their customers have now come online. One of the reasons is that the benefits of greater digitalisation became clear almost immediately. 

Businesses that took the opportunity at the outset to build new capabilities, establish new revenue streams or transform their business models rapidly gained an advantage over those that were slower to transform. 

Consider how the retail sector embraced technology to adapt to lockdown restrictions and reach customers, sell products and improve visibility over volatile supply chains. Many of the businesses that digitised with speed now enjoy the benefit of more resilient business models that are better suited to the demands of the modern economy.

Cloud at heart of region's future success

For businesses across East Africa, the cloud presents a unique opportunity to innovate, develop new products and services, and scale into new markets or geographies. 

Cloud technologies offer access to services and capabilities that are prohibitively costly for most companies to build themselves. By adopting cloud solutions for key business processes, organisations can drive greater efficiency and optimise their business processes without the upfront capital outlay of on-premise solutions.

Taking advantage of the wealth of cloud-based 'as-a-service' solutions can also augment internal capabilities and unlock access to supplier networks, tech skills and other capabilities that were previously out of reach. 

Many businesses have experienced the benefits of such services when the first lockdowns created the need to enable remote work capabilities. By leveraging cloud technologies, businesses could maintain communication with teams and customers and ensure continuity. Today, cloud technologies play a central role in transforming how organisations measure, manage and motivate their hybrid workforce.

As the ripple effects of the pandemic travelled through the global economy, businesses turned to cloud technologies to improve visibility over their supply chains and assist with planning and risk mitigation. When a different, post-pandemic customer emerged, one that demanded greater personalisation, convenience and choice, organisations could once again leverage the power of cloud technologies to enable new ways of engagement with customers.  

Once-in-a-generation opportunity

Now, the region faces a golden opportunity to drive innovation and achieve new gains across their internal and customer-facing operations by leveraging the cloud. 

A recent study revealed that some East African industries have taken the lead with cloud adoption, including the banking, marketing, agriculture and education sectors.

Considering the importance of manufacturing and tourism to the regional economy, organisations operating in these industries should leap at the opportunity to digitise.

Business-to-business spending in Africa's manufacturing sector is set to reach $1-trillion by 2050, and the sector is well-placed to grow and become more competitive through digitisation. By building Industry 4.0 capabilities underpinned by the cloud, manufacturers could unlock the benefits of AI and robotic process automation with predictive analytics to gain unprecedented control, predictability and operational efficiency.

The tourism sector was one of the hardest hit by pandemic restrictions as international travel came to a total standstill at the peak of the pandemic. Considering the sector contributed 8.1% to the region's GDP in 2019, the impact of the restrictions on local businesses could not be overstated.  

By leveraging the cloud to build new ways of engaging with travellers and removing friction from the travel process, the tourism sector could tap into a global tourism sector hungry for new experiences. 

Three focus areas for cloud success

Businesses will benefit from choosing priority areas for cloud deployment that can deliver the greatest benefit with the shortest time-to-value, and use the learnings to drive adoption in other areas of the business. 

Based on our work helping organisations in East Africa leverage the cloud for business success, the following key focus areas could offer the most valuable starting points for cloud adoption:

1 Innovate, innovate, innovate

East Africa can benefit from greater investment into innovation and research and development to improve the region's global competitiveness and lure foreign direct investment. 

The pharmaceutical sector, for example, holds enormous potential for research and development initiatives that can drive economic growth and create new industries while also reducing our need to import product and service innovations.

Regional innovators could consider to leverage the experience and market insight of cloud service providers with experience supporting pharmaceutical innovation. This can help avoid costly mistakes, close the gap on best practice, and ensure there is an optimal technology mix to support innovation. As an example, 18 of the world’s 20 largest vaccine manufacturers run their production facilities using SAP technology, so any new facility can tap into SAP’s domain knowledge to fast-track success.

2 Remove uncertainty from decision-making

The continued volatility in the global economy has created an environment of uncertainty that is hampering growth and innovation. To remove some of this uncertainty, organisations should invest in enterprise resource planning solutions to achieve greater clarity and control over key business functions and core processes. 

Cloud adoption can also unlock access to data and analytics capabilities that can empower decision-makers with accurate insights over their businesses, enabling them to guide the business through challenges more effectively.

3 Aim for speed

One of the greatest advantages cloud offers is speed. Instead of spending long periods of time building on-premise capabilities, businesses can readily tap into a wealth of cloud-based solutions to immediately enjoy efficiency and innovation gains. 

For mid-market organisations, this could unlock opportunities to quickly test new digital channels and trial new business processes. Successful trials can be rapidly scaled to the rest of the business or to new geographies, powering their growth.

Hardeep Sound is the Regional Sales Director East Africa at SAP.