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By 5 March 2020 | Categories: Events

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By: Jon Tullett, Senior Research Manager, IT Services, IDC sub-Saharan Africa

The market growth is stagnant, the landscape is volatile, and the future is as uncertain as it gets. And that’s not just in South Africa. Volatility and uncertainty have become the gold standard for measuring business sentiment and market outlook. However, this doesn’t mean that there isn’t opportunity and potential for the organisation to succeed, rather that it needs to adapt its outlook and reinforce its agility.

The problem is that everything is unpredictable. Even the experts are battling to find predictability within politics and economy and the Rand has become the most volatile, highly tradeable currency in the world. Events like Eskom, the February financial results, the South African Reserve Bank, Moodys and the ANC National General Council meeting are packed with risk and limited visibility into what conditions they will trigger within the country. The government is under pressure to reduce business risk and create space for organisations to thrive. But while that happens, what can business do now to ensure a sustainable tomorrow?

IT services and cloud computing are at the centre of the storm. Africa is finally receiving direct investment by hyperscale providers as multiple global providers settle down in the country and more continue to come in.  The South African Reserve Bank has given its green light for banks and there has been guidance released by SITA for the public sector. Things are happening, change is afoot.

For many companies looking to leverage this opportunity, rapid time to market and an aggressive channel will become standard practice. The mantra ‘adapt or die’ will dominate business behaviour as organisations look to cloud innovation and investment to revisit their foundations and strategies. It’s not a bad place to start, either. The Software-as-a-Service (SaaS) market has seen 31.2x five-year compound annual growth rates (CAGR), showing steady growth across all markets, particularly on-premise software with a 4.8% CAGR.

Hybrid cloud services and infrastructure are areas that have become essential value opportunity for service providers. The technologies that currently impact on business productivity and cloud relevance are tactical, inconsistent and siloed while investment into multiple environments escalates complexity and risk. Data governance is under increased scrutiny and a lack of coordination is dampening innovation. This is further affected by the skills imbalance that’s having an impact across company and industry.

Service providers that can tackle these pain points with relevance and cost-benefit are well-positioned to ride some of the turbulence that lies ahead. If they can show tangible benefits to digital transformation and how organisations can use this as a springboard into the future, then they’re looking at the opportunity, not a calamity. According to the IDC South Africa CIO survey 2019, organisations have seen the biggest benefits to their digital transformation in productivity, revenue generation from existing products, process cycle times, revenue generation from new products and cost efficiencies. The data is proof – digital delivers.

Innovation does have measurable outcomes.  Cloud can reshape ICT infrastructure management, business processes, deployment and optimisation, security and industrial processes. Datacentres need to revise their approach to be more focused on optimisation and upgrading existing systems. And partnerships have become critical success factors in the realm of commoditised ICT.

The ecosystem of partnerships has become a dominant trend in the market. Partnerships, collaborative engagements, ecosystems – these are the ways in which companies can expand their growth into new markets and deliver to their clients. By 2022 it’s expected that 78% of enterprises will partner with technology service vendors that are capable of orchestrating technology innovations into business use cases that can drive transformation at scale.

From partnerships to innovative implementations to optimisation and stabilisation, organisations can find opportunity within the complexities of the market today.  It just takes a shift in focus, attention to what the market really wants, the ability to build partnerships for sustainable growth, and a clear vision as to how cloud and digital can support growth for customer and market.

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