Digital initiatives hold the key to unlocking over R5 trillion in value in South Africa, according to new research from Accenture based on a value-at-stake framework – developed by Accenture and the World Economic Forum (WEF) as part of WEF’s multi-year Digital Transformation Initiative (DTI).
The research, titled Unlocking Digital Value for Business and Society in South Africa, reveals that by implementing key digital initiatives across government services and key industry sectors, value to society and industry amounting to R2 trillion and R3.6 trillion respectively could be unlocked by 2026.
“The research highlights major areas in which South Africa can unlock value – both financially and in terms of creating meaningful outcomes for citizens in their daily lives. A specific set of digital tools underlies that value creation,” said Vukani Mngxati, CEO for Accenture Africa.
The analysis, based on the ‘value-at-stake’ framework and coupled with expert interviews, local statistics, industry reports and other inputs, measures the impact that digital technologies and enablers such as analytics, blockchain, Internet of Things (IoT), and artificial intelligence (AI), could have on South Africa’ s industries and society.
The study assesses both financial value as well as ‘digital value to society’ (DVS), a measure encompassing the effect of digitalisation on factors such as health and safety, employment, the environment and labour.
The research also lays down groundwork, stimulates dialogue, encourages public-private sector collaboration, and proposes recommendations for national digital transformation strategies and investments to effectively power economic growth.
Unlocking value with digital
To 2026, the report estimated a total of R2 trillion at stake for government services. Digitalisation of public infrastructure maintenance, administration and healthcare alone can add over R1.2 trillion to society (environment, government and citizens) over the next decade.
Similarly, embedding key digital initiatives across nine industry sectors could deliver a further R3.6 trillion, the research highlights, the majority of which (R2.5 trillion) will accrue to industry, with the rest to societal outcomes. Transformation across agriculture, manufacturing and financial services presents the highest potential for gains, the report concluded.
In the agricultural sector, for example, the combined use of autonomous vehicles, drones and sensors has the potential to enable precision agriculture, improving the use of resources and increasing yields.
In the manufacturing sector, the implementation of technologies such as IoT and connected devices, and AI throughout the value chain has the potential to improve responsiveness to demand and enable the introduction of many value-adding services, effectively turning product companies into service companies.
For financial services, some of the key initiatives for unlocking value are platform businesses, new technologies replacing legacy systems, shifting channels and ways of interacting with customers as well as intermediaries, and lastly the move to driving real outcomes for clients rather than products alone.
The value at stake from digital transformation across five government services is just over R2 trillion
Digital transformation of nine industry sectors could deliver over R3.6 trillion, the majority of which (R2.5 trillion) will accrue to industry.
Three core digital technologies and enablers – IoT, AI and Platforms
Although far-ranging in its analysis (covering a total of 96 digital initiatives), the research revealed that three core digital technologies and enablers – IoT (Internet of Things) and connected devices, AI (Artificial Intelligence) and platforms – have the greatest potential for value creation, accounting for 68% of the total value at stake to 2026.
The value potential of IoT is likely to be the highest, due to the combined effect of the increasing affordability of smart devices and the widespread adoption of such tools by individuals and companies.
Progression and development are by no means automatic. Unlocking the value from digital transformation within the South African economy will necessitate efforts by both the public and private sector, the report notes.
For example, physical and digital infrastructure will require investment, with ubiquitous and unified access to physical connectivity (ports, roads, airports, etc.) and mobile connectivity (e.g., 4G, 5G) equally imperative. Skills development will also be critical, as well public-private partnerships.
The research provides an incentive to advance cross-sector collaboration on digital transformation efforts, and a compass to guide strategies. These could help drive economic growth and improve the way South Africans work and live, setting the pace and trajectory for the country’s economic growth for the next decade.
Source : businesstech.co.za