Business

ICT will drive the economy but first we need solid foundations

2017-11-08 23:21

In a world where technology continues to change our lives on every conceivable level, remaining up to date and relevant as an economy has never been more crucial.

The impact of technology has made the world smaller than ever before, so much so that being competitive in what the experts have termed the fourth industrial revolution means competing on the global stage.

This was the genesis of the discussion at the recent Gauteng Business Collaborative Forum for the ICT sector, with the focus clearly on setting the province up as an African leader and global player.

During the course of the forum, Professor Brian Armstrong, Telkom chair digital business at Wits Business School, made a point around being competitive. He said: “Being first doesn’t matter, but being first to compete on a global stage does.”

This begs the question: How does the province, and South Africa as a whole, compete on the global stage?

The answer is not a simple one, and a few key areas were highlighted during the day’s discussions, notably: skills and education, job creation and empowerment, driving social change, and regulation.

The genesis of the debate was consistent with Gauteng ICT sector strategy, that ICT is critical to drive sustainable growth and has shown strong output and investment in the past decade. Today South Africa has 95% broadband and digital penetration and Gauteng has the highest coverage and intensive spectrum capacity. However the Gauteng government recognises that access, affordability and high costs could be binding constraint for the provincial economy including slow broadband speeds compared with peer countries.

Policy constraints, weaknesses in institutional arrangements, conflicting policies between responsible departments, and regulatory failure have led to poor outcomes and slower development. Many of these policy issues arise at the national level.

Despite these drawbacks there are several interventions that can improve the impact of ICT in Gauteng – which has three goals:

1. Productivity: To improve the role and impact of ICT among small and medium-sized enterprises and larger firms; to improve service delivery through electronic government services; and to support measures for ICT research and development.

2. Connectivity networks: To foster the diffusion of ICT fixed and mobile broadband infrastructure; to improve the connectedness of small, medium and micro-sized enterprises, schools and households in ways that contribute to reducing the cost of communications; and to increase economic participation.

3. ICT skills: To address the demand for skills in the broad ICT infrastructure and ICT services sectors, as well as in the society at large; and to provide for online learning in every primary and secondary school classroom.

In addition we believe that ICT can also play a larger role to support the both township economy and government developmental objectives. The township economy revitalisation strategy already sets out several interventions which are in line with the Gauteng ICT strategy. The most important is broadband access and skills development, developing a systematic approach to identify talent in business for enrolment in township economy revitalisation projects, improving government services through ICT, and sharing information about existing government (and private sector) programmes.

The was consensus that skills and education within the technology space urgently need to be addressed and it should take place at all levels of education. However, merely stating that education needs to be addressed is not enough. As a country we must take a strategic approach to the development of skills. The government, in collaboration with business, universities and research institutions, has to lead a focused interrogation of what skills are needed and then implement a long-term strategy for the country’s learners to ensure that the right skills are being created to grow the ICT industry in the right direction. It is also vital to understand that the most ideal time to get people on the technology train is from early childhood. Programmes need to be targeted, so as to contribute to a growing a generation of technically competent youth so that we build a globally competitive economy and use ICT innovation as a differentiator.

But even more important than training people around the technical knowledge of coding, app building and cyber security, to name a few, is the development of creative and innovative thinking.

As technology continues to evolve rapidly we cannot always build on what has gone before, we need to be creating our own identity and finding new and novel solutions to the country’s unique challenges.

Once we have those solutions we need to whittle out the ones that are scalable and exportable. So it is crucial that we are actively creating a generation of thinkers, creators and innovators. This requires a new approach to education, one that challenges the youth to go beyond the parochial and become more inspired.

South Africa’s official unemployment rate is 27%, the idea of the fourth industrial revolution – a place where technology is ultimately going to replace jobs – comes with its own challenges in our context. The urgency of this is highlighted in the World Economic Forum report titled The Future of Jobs and Skills in Africa, which states that 41% of all work activity in South Africa is susceptible to automation. But, in a nation battling inequality, poverty and the legacy of separate development policy, creating a competitive economy through technology cannot come at the cost of employment.

It is in this context that both the public and private sectors need to work together to ensure that people – and especially the already disenfranchised – are not left behind. It is in this context that skills development outside of the formal education system becomes critical and increased virtual universal access to skills development and educational tools for school leavers.

A critical aspect of job creation is the issue of transformation in the sector, especially in the arena of development of entrepreneurship and small, medium and micro-sized enterprises. Successful enterprise development again falls under the collaborative banner, but growing businesses in the tech space requires a certain degree of ingenuity and innovation.

That said, finding inspiration in a country like South Africa should not be hard. Participants observed that advances in technology are not about the technology but rather about the social change that it facilitates. Using the healthcare system as an example, technology could change the face of South African healthcare through holistic systems that speed up the process from diagnosis to treatment, saving time and eliminating costs in the process. If, as South Africans, we sought to change the lives of the country’s citizens through the use of technology then this is where we will find the inspiration to create solutions that can ultimately allow us to play on the global stage. South Africa has the capacity to create these solutions; we have certainly seen such ground-breaking thinking to come out of our country time and again.

Of course, technology – especially when we are looking at servicing the greater good – requires regulation; but regulating adequately in a world that is changing so fast becomes a challenge. So the question that needs to be asked is: who does the regulating? Do we rely on an industry to self-regulate or is government required to step in and set the regulation agenda? This was a topic that was robustly debated.

Ultimately, industry self-regulation is the most efficient form of regulation, but when it comes to ensuring that the interests of the greater population are always kept top of mind, there needs to be a degree of government involvement where the regulators are looking out for the greater good, as opposed to the industry good. It is also in this regulatory space that South Africa has an opportunity to play a greater role in the global tech space.

Armstrong observed: “I think the cradle of humankind has an opportunity to position itself in a thought leadership position … What is appropriate ethical conduct in this future world? What are the regulatory boundaries? Where should we be regulating? What are the legal frontiers about liability and ownership? I think that is a discussion we should start.”

So as South Africa finds itself staring into this evolving tech world, with the ability to become a global player beckoning, it is now that making crucial decisions about the direction of our ICT industry is so essential. Without this blueprint we will have no idea where we are going, nor how to get there. What is needed is more than just a plan. Creating a healthy and viable industry requires vision, leadership, collaboration and, most importantly, action from all players. In the future, ICT will become a leading driver of the South African economy; now is the time to build solid foundations.

Abdullah Verachia is director of the Centre for Leadership and Dialogue at the Gordon Institute of Business Science

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November 12 2017