The impact of technology infrastructure when doing business in Africa

Leana du Plessis from Deloitte has written a short piece on the impact of technology infrastructure when doing business in Africa. Contact Leana at lduplessis@deloitte.co.za should you have any questions or require additional information.

The Impact of Technology Infrastructure on doing business in Africa

The transformation and challenges that twenty-first-century organisations face are vast and varied. Whilst progressively more pressure is being placed on organisations to continually improve and increase productivity and revenue, the pace of change in the new global economy has brought about its own unique set of constraints and challenges. Integration of information systems, new structures, business processes and the reallocation of functions and powers, to name but a few, have indeed created a new and challenging business environment. ICT is seen as the magic wand that can increase efficiency, provide access to new markets or services and create new opportunities for income generation and improving governance.

But what if you are in Africa? Africa has had its own challenges with inter alia diversity, political instabilities and the lack of proper IT infrastructure. Is this still true, and what challenges can you expect if you intend doing business in Africa?

The South African mobile phone companies’ success stories of mobile technology (200-million subscribers in early 2007) and telephony in Africa have changed the landscape and infrastructure availability radically. Network infrastructure has increased significantly over the past 12 to 18 months, and the cost has decreased as more players entered the market. However, it is still less affordable than in South Africa with limited options.

The lack of proper data centres and management of infrastructure is still a concern, and there is a serious skills shortage in the IT market. Legislation and regulations are limited in most of the countries, and this can open a risk for organisations that operate from South Africa, especially around privacy and protection of data. 

Service providers in many African countries are not used to Service Level Agreements (SLAs) and delivering or managing according to agreed SLAs. A number of organisations are managing the infrastructure from South Africa, but that has its own challenges with the delivery of services from a distance.

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2 comments on this post.
  1. Georg Trankle:

    one option/alternative that appears to work relatively well (at least technically and in an ERP systems environment) is systems hosting via sattelite, with signal drop points in Europe.

  2. David Graham:

    Thank you for your comment Georg. The last time we explored this option for an organisation the costs were pretty high because the country in which they were doing business charged an annual levy per user. Even though the local infrastructure could not cater for their requirements they were being penalized for seeking alternate viable options. I do not know if this issue still stands in most African countries