Digital transformation can be either a threat or an opportunity and it all depends on how organisations approach this revolution.
So said Mpumi Nhlapo, head of demand management at T-Systems SA, speaking at the ITWeb IT Sourcing and Vendor Management Summit 2016 in Johannesburg yesterday.
According Nhlapo, digital transformation is a threat to companies that are not proactive in innovating and are waiting to see what the big next thing will be and how their industries will be impacted.
This is because more than likely, competitors have already taken on the opportunities presented by the third platform (mobile, cloud, big data and Internet of things) which is driving the digital economy, he added.
These companies are trying to figure out which industries they can disrupt to create new businesses for themselves, noted Nhlapo.
Digital transformation particularly presents an opportunity in the South African and African context, when looking at the projections of Internet and mobile penetration growth, he said.
"We have seen that Internet penetration will continue to grow, driving the Internet economy which will continue to grow the economy."
Referencing a Frost & Sullivan report, Nhlapo said by 2025, there will be four billion connected devices in Africa, 41% Internet penetration with about 600 million users, 1.23 billion cellular connections and 956 million mobile broadband connections.
Africa's digital economy (as measured by total ICT spending) will reach $315 billion by 2025, accounting for nearly 7% of the continent's gross domestic product, he added.
Therefore, businesses and industries on the continent need to position themselves to take advantage of this growth and not wait for disruption to come to them, noted Nhlapo.
They need to ask themselves how pioneering they are and to what extent they are pushing boundaries.
Nhlapo added there are opportunities for businesses to leverage data that is coming from connected devices.
However, he pointed out that local companies are good at procuring IT services but are not thinking of the intellectual property that is sitting in their organisations to create new business opportunities.
Also, if SA is going to drive its digital economy, it needs local platforms, because if all its platforms are offshore, it becomes difficult to be agile and competitive, as it is relying on innovation to come from elsewhere, said Nhlapo.
"To drive local innovation, SA needs to have its own platforms and supporting infrastructure in the country."
Therefore, cloud becomes a really important aspect in terms of competitive advantage from both a country and organisational perspective, said Nhlapo.
"We need to make sure that as we are using international cloud platforms and offerings like Google and Facebook, we are not just giving away our information, interactions and networks but we are also benefiting sufficiently to create our own digital economies."
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