An answer to the digital divide

When it comes to spending on Black Economic Empowerment, the corporate and government spirit is willing, but the flesh can be weak, so to speak.

As legislative pressure rises on business and government to step up empowerment spend and bring small, medium and micro enterprises (SMMEs) into the economic mainstream, South Africa`s biggest spenders are increasingly stumbling on the same hurdle: a reliable way to identify and then interact with SMMEs.

"Compliance with procurement reforms has become a major factor in the purchasing decisions of government departments, state enterprises and big business. But the missing link for many is a common point of contact where buyers and black suppliers can come together," says Nobusi Shikwane, CEO of one-year-old e-business services company, B2BAfrica.

"More often than not, emerging entrepreneurs lack the means to invest in a PC or Internet connection, making it difficult for them to do conventional e-commerce in the tight timeframes that business dictates," says Shikwane. "We believe we`ve found the answer to that digital divide."

Using the Internet as the basic communications infrastructure medium, B2BAfrica has designed an SMME-enabling portal that supports unified messaging, thus enabling buyers to instantly reach small black suppliers, even if all they have is a prepaid cell phone contract.

If a buyer in Pretoria, for instance, wants a supplier in Port Elizabeth to quote on a contract, B2BAfrica`s portal can translate the message into whatever format - SMS or voice - the supplier can access. The supplier can then respond through a third party, such as one of the hundreds of communication kiosks being set up by private postal operators.

B2Bafrica, incidentally, already has a working partnership with one of South Africa`s most ubiquitous private providers.

Transport giant, Transnet, has been the first to benefit from B2BAfrica`s collection of business-to-business portals and platforms, which cover the full supply chain spectrum, from sourcing through to fulfilment and payment. On the buy side (e-procurement), B2BAfrica is the sole Southern African agent of US-based Ariba`s Spend Management software. For e-logistics, B2BAfrica uses i2 Technologies` FreightMatrix solution.

The transport link is no coincidence, considering B2BAfrica is a wholly owned Transnet subsidiary, set up just over a year ago specifically to enable the parastatal`s e-business strategy. B2BAfrica has already implemented a fully-fledged e-procurement project for Transnet, effectively consolidating the group`s spend across sourcing and procurement activities under one electronic roof.

With the buy side in hand, B2BAfrica is now tackling the e-logistics angle, aimed at streamlining and synchronising the movement of freight that Transnet handles. The aim is ultimately to put down a national e-logistics platform for Trade and Industry in South Africa.

Having tried and tested e-procurement within Transnet, B2BAfrica is seeking to spread its net wider, into both government and the private sector.

"Others may say they`ve got the same capability, but what differentiates us is that we are not focused on the infrastructure layer or the internal ERP systems," says Shikwane. "Our sole focus is at extended enterprise level - where the organisation interacts with external parties, meaning customers and suppliers. So, while we may have competitors, they`re not in the space we`re in."

But B2BAfrica is not coy about collaborating with competitors, says Shikwane, who claims the company`s integration platform is well geared for interconnectivity with competing offerings. "You have to open your platforms so your customer can get the service they want." She uses the banking analogy, pointing out that ATMs had very little critical mass until banks had interconnected facilities.

Shikwane is also keenly aware of prospective customers` wariness of making heavy capital investments without guaranteed returns. Hence, B2BAfrica`s approach of undertaking pilot projects first, on a pay-as-you-go basis.

"These pilots give organisations the opportunity to test-drive e-procurement on a small scale, for a small monthly fee and no capital cost, before they commit and invest," says Shikwane. "Show results and the commitment will come."