Internet of Things trumps AI and blockchain for SMEs in South Africa

31 May 2018 Consultancy.co.za

Although the integration of technology into business is gaining momentum in South Africa, a new report from research consultancy World Wide Worx has revealed that small and medium enterprises are more open to internet of things (IoT) applications in their business than other technology such as blockchain and AI.

The fourth industrial revolution has landed in many countries across the world, but perhaps the most accurate measure of integration levels is the degree to which small and medium enterprises (SME) have transformed their operations, given that competitive multinational corporations have been the drivers of the revolution in the first place.

In South Africa, analysis of the SME sector has revealed varying levels of preparedness and willingness to advance, depending on the type of technology in question. For instance, a recent interview with two senior executives working at a software solutions firm revealed that migration to cloud platforms is one area where SMEs were previously hesitant, but are now displaying intent.

A recent report from Big Four professional services firm Deloitte revealed how a handful of firms across South Africa have begun planning for the integration of the latest technology – particularly blockchain – into their operations. These tools are being considered not only to expand service offerings and reach, but also to optimise internal operations.Internet of Things trumps AI and Blockchain for SMEs in South AfricaHowever, according to a new report from World Wide Worx, this intent has not yet extended to the SME sector. Based in Johannesburg, World Wide Worx is a research-based consulting firm, which leverages its in-depth analysis on market trends to devise strategies for its clients.

As per the firm’s ‘SME Survey 2018,’ which analysed inputs from 1,400 respondents across South Africa, IoT is the only aspect of technological advancement that is gaining momentum amongst SMEs in the country. Over the next five years, 83% of those surveyed said that they would integrate IoT into their business over the next five years, while only 29% said the same about AI and 27% about Big Data.

“This is not too surprising, considering that these technologies are mostly beneficial to businesses with large customer bases or complex logistics,” said Arthur Goldstuck, Managing Director of World Wide Worx and the primary researcher for the survey. He went on to explain the divide that exists between SMEs andbigger corporations regarding the adoption of technology.

“It has become obvious over the years that only technologies that directly benefit the SME, by helping it to save or make money, or become more efficient, will be adopted. IOT clearly fits the bill here. SME decision-makers are generally only willing to embrace a new technology if there is a clear business case to do so.”

“Many SMEs have already been exposed to the benefits of the IOT in some form or another, thanks to technologies for vehicle tracking and asset management, so they are already aware of its benefits. This is the most likely reason SMEs foresee this as an area of major investment in the near future.”

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Smartphones are the device of choice for ecommerce in South Africa

08 April 2019 Consultancy.co.za

As the online retail market continues to expand in South Africa, customers are reporting that smartphones are their devices of choice when shopping online, more so that PCs and tablets. These numbers are detailed in analysis of the global consumer market conducted by global professional services firm PwC.

South Africa’s consumer retail sector has been among those that have remained the most stable throughout a relatively turbulent period for the country’s economy in recent years. The sector has grown at a steady rate of 5%, driven by growth in the operations of some of its largest retail companies.

Nevertheless, much like the rest of the economy, the retail sector is being heavily affected by the advent of digital tools, leading to a thriving ecommerce segment and significant transformations in the traditional retail segment. The latter includes the ‘digital retail’ experience, which offers customers data-driven insights in real time.

Outside of the retail sector, South Africans appear to have moved on to the digital sphere to conduct a range of other economic activity, including monetary transactions. According to Anton Hugo, who is the Leader of the Retail & Consumer Segment for PwC Africa, South Africans are rapidly becoming tech savvy.Smartphones are the device of choice for ecommerce in South Africa

Hugo describes that the devices used to conduct online transactions have undergone a transformation. Where consumers traditionally used a laptop or a PC for online purchases, 18% of the respondents to PwC’s survey in South Africa use smartphones for online shopping, which only 14% use a PC and 11% use a tablet.

More than 63% of the respondents, meanwhile, revealed that they had used their smartphone to clear bills and invoices over the last year, while 67% had used the devices to transfer money. South African consumers lead the global average in the usage of smartphones for the above functions.

“Not only are consumers the strongest link in the global economic chain, but PwC's Global Consumer Insights Survey shows the technological tools available to them have put them in a position to demand a tailored, seamless and multichannel shopping and social-media-powered experience. Retailers can achieve this by using a blend of both physical and digital approaches. The result for companies will be a greater return on experience with the customer and gaining a competitive advantage,” said Hugo.

Partner at PwC Rashaad Fortune commented on South Africa’s digital maturity, saying “In SA, having access to a computer with Internet access has been a challenge for many people, but with smartphones becoming cheaper and readily available, people have bypassed PCs and gone straight to mobile.”