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South Africa is far from platform-ready: report

Regina Pazvakavambwa
By Regina Pazvakavambwa, ITWeb portals journalist.
Johannesburg, 27 Jun 2018
SA ranks 14 out of 16 G20 countries on Accenture's Platform Readiness Index.
SA ranks 14 out of 16 G20 countries on Accenture's Platform Readiness Index.

Unless an enabling environment is created, and critical mass attained, South Africa is in danger of missing out on the platform economy.

This is according to a white paper titled entitled South Africa: Winning with Digital Platform, co-authored by Accenture South Africa and the Gordon Institute of Business Science, which focuses on the rise of the platform economy.

Digital platforms are transforming economies, but unfortunately South Africa is far from platform ready: it ranks 14 out of 16 G20 countries on Accenture's Platform Readiness Index, says the study.

South Africa is a country struggling with high unemployment and anaemic growth, with an economy expected to expand by just 1.5% in 2018, one of the lowest rates in Sub-Saharan Africa according to the World Bank. A platform economy would provide a much-needed salve, says the report.

The problem is, the country is simply not platform-ready, despite being home to the highest number of digital platforms in Sub-Saharan Africa. The country's poor physical infrastructure, skills shortages, and lack of a stable government are getting in the way the country's platform readiness, says the study.

To succeed in a platform economy, South African companies will need to address not only these technology and societal issues, but also their own business value and competitiveness, it adds.

"From Apple to Amazon to Alibaba, digital platforms are more pervasive and powerful than ever. That's why South African companies must consider developing a platform strategy, whether they own a platform or not."

The report states not every company needs to be the platform provider in SA. While some organisations may have this opportunity, most will find it cheaper and faster to leverage existing platforms as their means to enter new ecosystems and become enablers or collaborators to build new products, services, and customer experiences.

Yet, regardless of whether they are providers of platforms or participants in others' offerings, all companies will have to excel at leveraging the strength of platforms in their ecosystem to maximise their success.

That way, they will successfully capitalise on the innovation of the entire ecosystem instead of only using the resources within a given company or even industry, notes the report.

"Leaders should explore how platform-enabled business models can complement the traditional modus operandi of their organisations," says Jeff Yu-Jen Chen, faculty at Gordon Institute of Business Science.

Over a quarter (27%) of the 3 000-plus executives that responded to the Accenture survey said that digital ecosystems are transforming the way their organisations deliver value, says the study. And 81% said they expect platform-based business models to be core to their growth strategy in 2018.

Globally, most executives know they need to capitalise on new relationships and develop a network of digital partners to position their businesses in emerging ecosystems," notes the report.

"All industries are exposed to disruption, and established companies are among the most vulnerable," says Rory Moore, innovation lead for Accenture in Africa. Those businesses that are well prepared for disruption are building their growth strategy on platforms."

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