Digital initiatives could present an R5 trillion opportunity for South Africa
A new report by global management consultancy Accenture – prepared in collaboration with the World Economic Forum (WEF) – has revealed that nearly a hundred targeted digital initiatives spanning a number of public and private sectors could generate value of as high as R5 trillion in the next ten years.
South Africa is a country that stands to simultaneously lose and gain substantially with respect to the rapid rise in digitalisation. The country suffers from a high rate of unemployment – nearly 30% – and is at risk of losing nearly 6 million jobs to automation and artificial intelligence (AI).
On the other hand, the country is home to a number of budding enterprises that are not only looking to embrace an innovative approach to growth, but are also increasingly coming to terms with the costs of implementing industry 4.0 applications within their business operations.
In this regard digitalisation offers a substantial opportunity for the South African market in the near future. Accenture has been particularly active in promoting an innovative spirit in South Africa, and has now come up with analysis of just how much the country stands to gain if digitalisation is done right.
The firm has developed what it terms as the ‘value-at-stake’ model in collaboration with the WEF. The model examines the potential of digitalisation across the government and business sector and offers ten-year predictions of possible benefits therein, offering a framework for strategising for a digital future.
Digital initiatives considered under this model include transport initiatives such as autonomous vehicles, predictive data analysis, “remote healthcare” and even drone technology. Uses for these initiatives span the industrial sector, consumers and overall society.
The model is also comprehensive in terms of its consideration of various levels of the supply chain, and incorporates nearly 80% of all revenue generation systems. “The framework also quantifi es Digital Value to Society (DVS) by aggregating the key performance indicators that measure the impact of digitalisation on health and safety, employment, the environment, labour and consumers,” explains the report.
The areas of potential investment identified by the value-at-stake and DVS frameworks create room for collaboration among various industries and businesses. If such collaboration is conducted in a focused manner, the report predicts that South Africa could add as much as R5 trillion to its economy over the next decade.
Specifically, the report puts forth 96 initiatives that could accelerate growth across all sectors in the country, public and private. In the government domain, the consulting firm identifies five areas in particular that could be lucrative digital markets in years to come.
These include public infrastructure, where the total value at stake is as high as R727 billion, R574 billion of which comprises the value added for society. Other lucrative government areas include public administration, public healthcare, safety & security and social services, all of which combine to contribute just over R1 trillion.
In the private domain, the financial services sector is the most promising area for digital investment, with a value-at-stake of nearly R1.3 trillion. Other sectors that follow at some distance include agriculture, manufacturing, consumer industries, metals & mining, utilities, oil & gas, telecoms and media.
