South Africa’s digitisation faces emerging tech conundrum

igital momentum in South Africa has decreased as companies struggle to apply emerging technologies.

This is according to global market intelligence firm International Data Corporation (IDC).

The company says the South African environment is lacking skills, and companies are struggling to acquire the right talent to implement digital transformation (DX) initiatives.

IDC says DX continues to be a crucial component of the corporate landscape in South Africa, however, the firm says skills remain scarce in South Africa, so local entities must upskill talent, manage internal skills, and enhance skills in critical areas across security, cloud, and line of business.

According to a recent IDC poll, operational transformation is a top priority by 58% of CIOs in South African entities with more than 100 workers, and digital-first experiences are considered important for business resilience by 56% of CIOs.

DX gives the business significant benefits in terms of cost savings, agility, workforce transformation, and customer experiences, but organisations are having trouble maintaining the momentum of their DX journeys, according to Derrick Chikanga, research manager: IT services at IDC.

He says: “South African leaders have challenges around reducing the digital acceleration gap while keeping up with emerging technologies and, unfortunately, the gap has widened due to the digitalisation slowdown in most companies.

“Digital momentum has decreased as companies struggle to apply emerging technologies in an environment that lacks business and technical skills and companies are struggling to acquire the right talent to implement their DX initiatives.”

DX, says Chikanga, offers clear value to the business across cost efficiencies, agility, workforce transformation, and customer experiences, but organisations are finding it challenging to sustain the momentum of their DX journeys.

“It is clear that digitalisation is delivering on its value and benefit promises for local organisations, but the journey isn’t easy,” he continues. “Organisations find it challenging to identify suitable solutions, prioritise investment, balance existing operational costs with budgets for innovation, and to manage internal resistance to change.”

He says overcoming these challenges is a strategic business priority for companies in South Africa, particularly if they want the tools, agility and stability required to ensure they thrive in the current economic environment.

According to Chikanga, for organisations to thrive, they need to overcome these complexities while aligning DX with cost, security, and operational considerations.

He says: “The first step is to identify processes appropriate for automation and to use them to improve efficiencies, consistency, scale and integration across different lines of business.

“They should also ensure their technology investments are assessed for performance and business value. As DX maturity evolves throughout the organisation, analytics should also gain better business relevance, especially as digital processes will add to ever-growing data streams within the business.

“These can be analysed to highlight opportunities and stresses within the business and can leverage AI and machine learning to deepen enterprise intelligence over time.”

Chikanga says companies need to choose the right platforms as this is critical when they reach the inflexion point at which progress slows down.

“Platforms, both in terms of technologies and partners, can tremendously accelerate DX. The right partners can help to align digital strategies and create roadmaps that address immediate needs and long-term demands.

“This approach will also help companies to prioritise AI, automation, security, and innovation in line with their sector and priorities as an organisation.”