Digital technologies are transforming African businesses, but obstacles remain
Digital technology is being used to improve rice processing in Nigeria. Shutterstock
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Digital technology has created new opportunities for businesses in sub-Saharan Africa to compete on a more equal footing. However, these businesses have yet to enjoy the full benefits because of a difficult operating environment.
Our recently published , 鈥楧igital Entrepreneurship in Sub-Saharan Africa: Challenges, Opportunities and Prospects鈥�, details case studies of economic sectors where digital technologies are making a positive impact.
In Ghana, digital technologies have had an impact on the agriculture sector. Agri-tech firms like Farmable, Farmerline and Esoko have successfully pursued the creation of new business ventures and renewal of existing, matured corporate business models. These agri-tech firms support farmers with pricing data, crowdfunding and communication activities. They are also connecting farmers with buyers as well as helping them work out what differentiates them from competitors.
Digital technologies are playing a role in Nigeria鈥檚 agricultural sector too. , an engineering company that supplies equipment to rice processing firms, and Al-Wabel Trading Company Ltd, a rice miller, have been working together to invent new technological solutions. These are aimed at improving the performance of rice processing. The innovative solutions the company came up with for rice processing can be applied more widely across the agricultural sector. However, these firms have had to overcome regulatory and institutional challenges in the sector.
Crossing boundaries
Digital technologies have also become a part of arts, media and entertainment, in particular in Kenya and Nigeria.
Case studies from show how small and medium-sized new media players benefit from embracing a culture of experimentation, partnership and continuous learning. These businesses have adopted a 鈥渕obile first鈥� mindset. They do this by using mobile technology as a resourceful, quick and flexible solution to do business, connect and promote their content.
The advertising, game development and media companies that took part in the research had all invested substantially in establishing their own systems for sharing data. These firms also embrace the which centres around social causes and 鈥渁s driving forces of the business鈥�.
Nigeria鈥檚 movie industry, too, has benefited from digitisation. The technology has improved production time and quality. It has also helped extend the reach of movies to wider audiences. Foreign investors are taking in this .
A potential drawback of digital technology in the arts is that cultural artefacts created digitally can also appear in many places at once. So, instead of gaining visibility it is actually lost in the digital crowd. But have managed to use social media networks to build their own 鈥渃ultural capital鈥� and gain access to physical galleries.
Innovation hubs
There鈥檚 also been an increase in the number of digital hubs across the sub continent. But do they really help business to start up and survive?
The number of innovation hubs in Africa has grown sharply. There鈥檚 BusyInternet and in Ghana; in Kenya; and Nigeria鈥檚 Yaba, a suburb of Lagos labelled the country鈥檚 Silicon Valley.
A chapter in discusses the social complexity of engaging these hubs. In Accra, the Ghanaian capital, hubs could not provide support that is relevant to local digital entrepreneurs鈥� circumstances. Entrepreneurs in Harare thought that hubs 鈥渨asted precious resources鈥�. Most hubs on the subcontinent also appear to make little contribution to the creation of new businesses.
Perhaps who are passionate about the region should assist digital hubs to make the necessary changes to how they operate.
Local conditions and culture can shape the 鈥渆cosystems鈥� in which businesses operate. Some of these conditions, such as corruption, are hostile to business efficiency. The are most pronounced in the communications, transport, and energy networks. Much of the region鈥檚 infrastructure is inefficient, and more than three-quarters of the .
Take Nigeria鈥檚 movie industry. It needs more than . It also needs government to make regulatory changes to protect the creative sector. Government should also prioritise the development of movie industry skills. The same can be said about .
Afrocentric digital solutions
Overall, the book highlights that in a region with multiple social, environmental, economic and political challenges there is a need for more interrogation into how both incumbent and new players in sub-Saharan Africa are shaping the landscape with a view to meeting the .
Digital technologies, as some of our case studies show, can play an important role in transforming African economies. However, digital technology solutions must not just be mere adaptations of dominant Western services and products. They must be aimed at meeting the sub-continent鈥檚 needs. In this regard, there鈥檚 a lot to learn from Japan.
Demand for technology after the Second World War resulted in the development of a plethora of advanced solutions which secured Japan鈥檚 status as an innovator. There are promising new ventures such as in Ghana 鈥� the company鈥檚 first in Africa. This is a centre of research into digital solutions to Africa鈥檚 problems.
, Principal Academic in Marketing, and , Lecturer in Entrepreneurship and Innovation,
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