Monday, 26 October 2015

Outlook Cloudy in Africa

If you want to expand your business overseas, your choices are limited. Europe and other developed markets are debatably saturated though economic growth is not strong; so the biggest opportunity lies in the undeveloped, but burgeoning markets of Africa. Africa is seen as a land of opportunity, with masses of people desperately in need of limitless numbers of products and services, and land rich with untapped natural resources…

But doing business in Africa brings its own challenges, including a massive lack of infrastructure at most levels. Flights are few and unreliable. The distances you need to travel are often impossible to cover without going from plane to train to bus to taxi over days; which is not only inconvenient but also prohibitively expensive in both time and actual cost.

There are large portions of the African continent that have security issues – from war zones, to theft born out of poverty and desperation, to a lack of physical infrastructure to protect people from natural disasters such as flooding and fire. These physical discomforts and threats are obstacles to convincing skilled professionals needed to run businesses and implementations to travel to these places.

Once you have managed to safely reach your destination, you then face the difficulties of actually doing business there; from slow to non-existent connectivity to juggling the legal and cultural diversities prevalent throughout the continent and even within individual countries on the continent.

Cloud-based services offer an obvious way to expand your business offerings to new clients near and far. There are the benefits cloud brings to all businesses – cost savings of no longer owing the infrastructure and software, updates, faster integrations, customisations, fixes and even additional products and features that can be implemented without physical presence.

Sounds like manna from heaven in the African context, addressing many of the pitfalls addressed previously; removing the constraints of extensive travel, increasing security and redundancy in areas where both physical safety and natural disasters are commonplace, and providing world class products to those that otherwise might never have access to them.

Yet, the lack of infrastructure that makes cloud such a perfect solution for Africa is also the biggest obstruction to it. There have been enormous developments in the ICT industry in East and West Africa; but there is still a massive lack of infrastructure to support the high speed connectivity needed to make cloud a fully viable option. So although the infrastructure is growing, Africa still needs on-site products.

With many companies focusing their development on moving away from on-site installation and into the development of cloud, soon the only thing they will have to offer is cloud… Is that not delivering first world solutions to a third world continent?  

*As published in Accountancy South Africa in February 2015


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