Shared Value in the 4IR Opportunities for the TMT industry
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
"The COVID-19 pandemic has illuminated the opportunities and challenges that the 4IR brings, in ways no recent event in history has."
Shared Value in the 4IR | Foreword Foreword The COVID-19 pandemic has hurtled the world into a future that was only previously imagined. It has brought debates on the Fourth Industrial “Technology is rapidly Revolution (4IR) and its impact on society to the forefront. In the last 18 weaving itself into the months, we’ve seen changes at every level of society. The way we approach education, healthcare and social services, and the way we do business has fabric of human life. This been transformed. has brought about an Technology is rapidly weaving itself into the fabric of human life. This has enormous leap in quality brought about an enormous leap in quality of life, consumer choice, convenience, globalised trade and socio-economic development, but it has of life, consumer choice, also brought with it deepening inequalities and societal divisions, as well as convenience, globalised concerns about the intrusiveness of technology companies and our right to privacy. trade and socio-economic development, but it has In light of this magnificent transition, the South African telecommunications, media and technology (TMT) industry finds itself in an interesting position. also brought with it It is both a perpetuator of change and a responder to change. This also puts the industry in a unique position to ensure that the potential benefits deepening inequalities of the 4IR are maximised and that it is shared as broadly as possible. and societal divisions, as This report illuminates how a shared value (SV) approach can assist TMT well as concerns about companies in using technology to solve societal problems. The report the intrusiveness of focuses on three opportunities for high impact: digital access, digital inclusion and “tech for good”. It also sheds light on the innovative work technology companies being done by the World Economic Forum (WEF) in ensuring an inclusive and our right to privacy.” 4IR. The WEF will soon launch Centre for the Fourth Industrial Revolution in South Africa (C4IRSA) – a so-called “do tank” – where it will aim to enhance the benefits of technological progress through collaboration and entrepreneurialism. Technology is not inherently good or bad. It is up to us to harness its potential for good. And as we look back on a year of unprecedented change, we see there is more potential than we ever thought possible. 01
Shared Value in the 4IR | COVID-19: A catalyst for 4IR COVID-19: A catalyst for 4IR The COVID-19 pandemic has illuminated the opportunities and A number of the large telecoms and technology companies challenges that the 4IR brings in ways no recent event in history followed suit. Vodacom pioneered a free virtual school with has. It is no longer something we are anticipating; it is here with educational content for all grades. MTN provided zero-rated us and here to stay. It has become so ubiquitous that some of online resources on Siyavula.com, while Microsoft offered the transitions we have made as a globalised society took place students free access to Office365 at Mahala.ms1. seemingly undetected. Education In response to social distancing measures, the education sector launched the largest digital education programme yet, comprising of online learning material and revision classes distributed on radio and television. 02
Shared Value in the 4IR | COVID-19: A catalyst for 4IR Retail small, medium and micro enterprises (SMMEs). This was Online retail grew by approximately 40% during nationwide articulated by DTIC Minister Ebrahim Patel when he stated that lockdowns. The growth was largely attributable to consumers the department “look[s] forward to future engagements with who may otherwise not have adopted online shopping2. the [retail] sector to address how to create more jobs in the Omnichannel retailers experienced a similar surge, although sector and retrain workers displaced by the shift to online gains have been partly offset by declines in e-commerce”. He also committed to “ensure that there is space brick-and-mortar trading. for local small businesses and youth-owned enterprises as suppliers of goods and providers of digital platforms and The rise in e-commerce brought with it a growing disparity delivery services”4. between powerful global manufacturers and local traders. According to a survey conducted by the United Nations Conference on Trade and Development (UNCTAD), small merchants were least equipped to sell their products online3. The Department of Trade, Industry and Competition (DTIC) has recognised the need to provide more systematic support to 03
Shared Value in the 4IR | COVID-19: A catalyst for 4IR Healthcare The South African healthcare industry has tried for many years to scale up telemedicine as a means of distributing health-related services, but healthcare regulations hindered progress. Social distancing measures necessitated a relaxation of guidelines by the Healthcare Professions Council of South Africa (HPCSA), which made largescale virtual consultations possible. A partnership between Discovery and Vodacom offered free, virtual consultations to the public. One tele-triage provider, which offered COVID-19 screening services, reported that 97% of interactions with users took place without a face-to-face referral5. 04
Shared Value in the 4IR | COVID-19: A catalyst for 4IR Mobile technology This enables data subjects to have control over the manner and Many governments and healthcare providers across the globe method in which their personal information is kept6. This raises introduced contact tracing apps in an attempt to gauge the questions about the precedent being set regarding data rights spread of the disease and adjust lockdown restrictions in the future. accordingly. In the same token, the South African government partnered with the University of Cape Town (UCT) to develop a contact tracing app called Covi-ID. The app signalled the largest human geo-tagging project in South African history. The app presented a shift in the way personal data is stored and managed. According to Norton Rose Fullbright, the app “collects users’ personal locations and their infection statuses and stores the data on the individual’s phone using a technology called ‘self-sovereign identity’”. Data is therefore not stored on a centralised government or private-sector database. 05
Shared Value in the 4IR | COVID-19: A catalyst for 4IR Social services The initiative brought about R53,379,830 in contributions The use of technology permeated relief care and social services towards food vouchers, resulting in 26 406 vouchers being surprising speed. Within a month, digital food relief initiatives issued by November 20208. were being rolled out by pioneering organisations such as the DG Murray Trust. The trust partnered with retail technology service provider, Flash, to create a R2 million electronic food voucher system named “CoCare”. The system enables a more efficient allocation of food by eliminating the risk of food waste and feeding vulnerable communities simultaneously. The CoCare voucher programme works with local and regional Non-Government Organisations (NGOs) to determine which communities are most at risk of food shortages7. 06
Shared Value in the 4IR | COVID-19: A catalyst for 4IR Technology and society The COVID-19 pandemic has catapulted technological progress There are many organisations working towards the beneficial forward and put us in the throes of the fourth industrial application of technology. Tech For Good9, for instance, is a revolution. Technology is not inherently good or bad. It is for movement that focuses on the intentional design, development this reason that the pandemic-driven modernising leap is willing and use of digital technologies to address social challenges. us to think more deeply about our relationship to technology at Similarly, CODE4SA10 is a local group that uses data and a personal, societal and government level. technology to promote informed decision-making towards social change. The World Economic Forum (WEF) is driving How do we harmonise the technologies and digital tools we use initiatives like “Internet For All”11. The initiative seeks to use with our personal beliefs? When are we comfortable, for multi-stakeholder partnerships to facilitate the establishment of instance, to share personal information with technology physical and digital platforms at a global level in an attempt to companies? At a societal level, will this meteoric progress help millions of the hardest to reach people to access the enable us to bridge disparities like economic inequality or will it online world. exacerbate the marginalisation of the most vulnerable? Will governments be able to strike a balance between creating a more progressive framework to promote innovation and holding the powerful accountable? 07
Shared Value in the 4IR | Shared Value (SV): Re-enforcing meaningful transformation Shared Value (SV): Re-enforcing meaningful transformation Deloitte’s Value Beyond Compliance (VBC) practice is built on The next section outlines three key opportunities for the TMT the premise that there is the potential for synergy between industry to create shared value in a technologically driven economic performance and social progress. The principles African future: providing digital access, improving digital underlying the practice is aligned to Michael Porter’s concept of inclusion, and driving “technology for good” initiatives. “shared value” (SV): the idea that profitable business models can be designed so that they solve social problems. To achieve it, businesses must go beyond simply ticking boxes to comply, but "The Telecommunications industry actively drive strategies that promote social progress. can become the connecting force In the TMT industry, companies need novel ways to manage through which we achieve rising stakeholder demands and increasing regulation requiring developmental impact. Companies in the TMT industry have inclusive and sustainable growth recognised this, and as a result have prioritised digital access, in the 4IR." digital inclusion and environmental sustainability in their corporate strategies. Studies have shown that mobile ownership combined with internet connectivity is associated with wellness improvements. According to the International Telecommunication Union (ITU), a 10% increase in mobile broadband penetration can lead to a 1.8% increase in gross domestic product (GDP) in the case of middle-income countries, and as much as 2% in low-income countries12. There are a number of opportunities for companies in the TMT space to be a force for good in the 4IR. Their involvement is particularly critical in light of the developmental challenges occasioned by the ever-expanding “youth bulge” in Africa. The number of young people on the continent is expected to rise to 830 million by 205013, and in South Africa, the youth presently make up 30% of the population14. The Telecommunications industry can become the connecting force through which we achieve inclusive and sustainable growth in the 4IR, because it is uniquely positioned to drive impact through technology and to contribute to key outcomes outlined in the National Development Plan (NDP), such as raising employment through faster economic growth, improving the quality of education, skills development and innovation, and building the capability of the state to play a developmental, transformative role. 08
Shared Value in the 4IR | Opportunities in the TMT sector Opportunities in the TMT sector (1) Digital access with awareness campaigns to ensure goodwill towards the Digital access is the ability to fully participate in a digital society. brand is generated broadly. Lastly, when it comes to battery The response to the COVID-19 pandemic led to the closure of theft specifically, companies should consider investment in physical places of interaction. Internet access has become the private solar power solutions for communities without reliable primary vehicle for collaboration and the exchange of access to the grid. This would remove the criminal demand for information. An estimated 4 billion people across the globe are batteries and will play a developmental role in marginalised not connected to the web15. In South Africa, only 51% of the communities. population enjoys internet access16. Organisations like the WEF, alongside a number of advocacy groups across the world, are (2) Digital inclusion championing “internet for all” in order to mitigate the The issue of digital inclusion is closely related to digital access. compounding effects on socio-economic indicators brought Where access focuses on connecting the unconnected, digital about by a lack of internet access. inclusion is centred on empowering underserved communities to participate in the online world. Where access relates to According to a white paper by the WEF and the Boston technology and infrastructure, inclusion relates to people. Consulting Group (BCG), some of the barriers to digital access are a lack of infrastructure and affordability. The demand for technology-related jobs is set to increase by 1.2 million in South Africa by 203019. According to a report by Infrastructure is a tremendous hurdle to digital access in the the International Finance Corporation (IFC), 230 million jobs in developing world, especially in countries with large rural Sub-Saharan Africa will require digital skills by 2030, resulting in populations and dwindling investor confidence. In South Africa, almost 650 million training opportunities20. infrastructure vandalism remains a marked concern. Cable theft alone has led to estimated losses of R5-7 billion a year17, and Many multi-national technology companies, such as Microsoft, battery theft has reportedly increased significantly in periods Hewlett Packard (HP) and Amazon Web Services (AWS), are where load-shedding was applied. opting to invest in skills development programmes such as AWS free cloud computing skills training and HP Life, a free A number of telecommunication companies have launched skills-training programme. initiatives to battle infrastructure vandalism. MTN launched a community tip-off initiative which has led to some success. A marketing campaign encouraged ordinary citizens to report “Efforts at ramping up security theft, vandalism, or any suspicious behaviour on a toll-free alone have not succeeded in anonymous line. MTN, in collaboration with security teams and the South African Police Service (SAPS), was able to recover over deterring theft and vandalism. R1 million in stolen batteries18. Many telecommunication Efforts at ramping up security alone have not succeeded in companies who have spent deterring theft and vandalism. Many telecommunication companies who have spent excessive amounts on cameras, excessive amounts on cameras, geo-trackers and security personnel have little to show for it. It geo-trackers and security is clear that reactive approaches are not as effective as preventative approaches. personnel have little to show for it. It is clear that reactive When we view infrastructure vandalism from an SV perspective, a number of strategies emerge that addresses the root cause of approaches are not as effective the issue. In order to incentivise communities to assist against infrastructure vandalism, community ownership schemes can as preventative approaches.” be explored. These schemes have the additional benefit of improving BBBEE scores. Telecommunications companies can increase brand loyalty in host communities by increasing corporate social investment (CSI) spend and scaling up local development initiatives. This should be done in conjunction 09
Shared Value in the 4IR | Opportunities in the TMT sector However, these programmes only begin to scratch the surface (3) Tech for good of what is possible to meet local demands. When viewing the “Tech for Good” is the intentional design, development and use situation from an SV perspective, it is clear that organisations of digital technologies to address social challenges24. TMT like these needs to not only focus on developing basic digital companies can play a key role in creating and promoting skills but need to review the rules for entry level positions. technological – and uniquely African – solutions to the Companies need to recruit and groom talent beyond those with continent’s developmental challenges. university or TVET qualifications, especially since higher education is inaccessible to the majority of young people due to Nowhere is this better illustrated than by the South African unaffordability and being historically disadvantaged in terms of government’s technology-driven engagement solution for quality of education21. Moreover, making remote working COVID-19-related queries. When the first few COVID-19 cases positions available to new entrants can reduce transport and were recorded in South Africa, the Department of Health (DoH) housing costs, increasing take-home pay. Lastly, multi-national set up phone hotlines to deal with queries from the public, but telecom and technology companies can take collective action to soon call volumes became too large to manage. To address this absorb young talent into entrepreneurship initiatives that foster problem, the DoH partnered with technology non-profit innovative thinking and provides the necessary support to Praekelt to develop an interactive WhatsApp chatbot that transform good ideas into commercially viable products and responds to common pandemic-related questions regarding services. The added benefit of supporting local entrepreneurs is symptoms, treatment, statistics and preventative measures. that it has a multiplying effect because successful Within 10 days after the bot went live, more than 3.5 million entrepreneurs will inevitably become employers and buyers of South Africans had engaged with it. The initiative was so other goods and services. successful in South Africa that the World Health Organisation (WHO) adopted the technology for its own global helpline25. In the 4IR, there are close links between digital inclusion and financial inclusion. A study by the Tufts Fletcher School22 A space to find technology-driven solutions examined the likelihood of 6 African countries to “leapfrog” The WEF is driving a number of initiatives to positively shape the ahead of its economic growth trajectory with the spread of relationship between technology and society. The WEF Centre mobile technology. Although South Africa stood out as a for the Fourth Industrial Revolution in South Africa (C4IRSA) will regional leader in creating digital jobs and the deployment of soon be launched and is intent on serving as a catalyst for emerging technologies, it fell short in its digital money score. In collaboration in the age of digital transformation. According to 2017, 60% of South Africans engaged in digital payments, but the WEF, the centre will function as a “do-tank” and will be a the number drops to 30% for the population’s poorest 40%. champion for ethics and values in technology. The report recommends that digital payments capabilities be made more inclusive. Similarly, an article by Forbes23 on the The centre will furthermore support curated projects and ability of technology to address South Africa’s pervasive engage with diverse stakeholders, including regulators, to inequality highlights efforts by technology companies to make it develop policy frameworks that can be applied across easier and more affordable to send money. Innovative solutions industries. such as the simple point-of-sale device pioneered by Yoco and the peer-to-peer payment app developed by Slide are making it easier for South Africans to access, and become part of, the formal financial system. 10
Shared Value in the 4IR | Opportunities in the TMT sector Affiliate centres across the globe will be connected by the C4IR Conclusion Network, which aims to join together governments eager for The scope for the TMT industry to play a role in increasing tools to shape the trajectory of technology with businesses digital access, digital inclusion and the use of technology for the eager to accelerate the benefits of new technologies to society. societal good is boundless. The time to bring SV strategies into It provides a unique platform to cultivate communities of core business strategies is now – as we find ourselves on the thought leaders, the world’s foremost technology companies, cusp of a new industrial and economic reality. Good start-ups, investors, public authorities, and leading academic momentum has been created, and the groundwork has been institutions. laid for initiatives that drive real results. All that’s left now is for the world of TMT to adopt it. One of the first projects to be launched by the centre works with a cohort of SMMEs to improve their productivity by using Internet of Things (IOT) technologies, enhancing cross-SMME collaboration and providing ongoing financial and expert support to the cohort. The WEF found that there are a number of barriers that inhibit the adoption of new technologies by SMMEs, including lack of access to capital and few skilled employees. The objective of the project, therefore, is to increase the ability of the SMMEs to participate in local markets and supply chains, and to eventually compete globally. The project is linked to the ‘Policy Protocol’ developed by the WEF, the Ministry of Economy of Brazil and the Brazilian State of São Paulo, which aims to help policy-makers deliver on a more inclusive Fourth Industrial Revolution26. 11
Shared Value in the 4IR | Contributors References 1 Mokhoali, V. (2020). "Lockdown lessons: SA pupils turn to 13 Chatterjee, S. (2017). " Promise or Peril? Africa's 830 Million 24 Roberson, J. (2018). "What is Tech for Good", Techforgood. online learning to keep studies on track", Eye Witness News. Young People by 2050", UNDP. (Available online at: (Available online at: https://techforgood.global/) (Available online at: https://www.africa.undp.org/content/rba/en/home/blog/2017 https://ewn.co.za/2020/04/01/lockdown-lessons-sa-pupils-tur /8/12/Promise-Or-Peril-Africa-s-830-Million-Young-People-By- 25 Anderson, H. (2020). Insights From Africa’s Covid-19 n-to-online-learning-to-keep-studies-on-track) 2050.html) Response: Tech Innovations, Tony Blair Institute for Global Change. (Available online at: 14 Stats SA. (2019). "SA population reaches 58,8 million". https://institute.global/advisory/insights-africas-covid-19-resp 2 Research and Markets. (2020). "South Africa Online Retail (Available online at: onse-tech-innovations ). Industry Report 2020: Market Grew by Approx. 40% During http://www.statssa.gov.za/?p=12362#:~:text=According%20to COVID-19 Lockdown". (Available online at: %20the%20mid%2Dyear,and%208%2C80%20million%20fem 26 WEF. (2020). “Accelerating the Impact of Industrial IoT in https://www.globenewswire.com/news-release/2020/09/29/2 ales) Small and Medium-Sized Enterprises: 100471/0/en/South-Africa-Online-Retail-Industry-Report-202 A Protocol for Action”. The World Economic Forum. 0-Market-Grew-by-Approx-40-During-COVID-19-Lockdown 15 WEF & BCG. (2016). "Internet for All A Framework for .html) Accelerating Internet Access and Adoption White Paper", WEF. (Available online at: 3 Netcomm Suisse Ecommerce Association & UNCTAD. (2020). http://www3.weforum.org/docs/WEF_Internet_for_All_Framew "COVID-19 and E-commerce. Findings from a survey of online ork_Accelerating_Internet_Access_Adoption_report_2016.pdf) consumers in 9 countries". UNCTAD. (Available online at: https://unctad.org/system/files/official-document/dtlstictinf20 16 Kemp, S. (2019). "Digital 2019: South Africa", Datareportal. 20d1_en.pdf) (Available online at: https://datareportal.com/reports/digital-2019-south-africa) 4 South African Government News Agency. (2020). "Online shopping now open for all". (Available online at: 17 Dzansi DY, Rambe P, and Mathe L. (2014). "Cable Theft and https://www.sanews.gov.za/south-africa/online-shopping-now Vandalism by Employees of South Africa's Electricity Utility -open-all) Companies: A Theoretical Explanation and Research Agenda", Journal of Social Sciences, 39:2 (179-190). 5 Percept. (2020). "Reflections from the South African telemedicine market in light of Covid-19". (Available online at: 18 Moyo, A. (2020). "Suspects nabbed for suspected stolen https://percept.co.za/wp-content/uploads/2020/12/Percept-T electronic devices", ITWeb. (Available online at: elehealth-Report-Final.pdf) https://www.itweb.co.za/content/JBwEr7n5lYzv6Db2) 6 Norton Rose Fulbright. (2020). "Contact tracing apps in 19 Magwentshu, N & Rajagopaul, A. (2019). "How to harness South Africa". (Available online at: technology for growth in South Africa", Mckinsey & Company. https://www.nortonrosefulbright.com/-/media/files/nrf/nrfwe (Available online at: b/contact-tracing/south-africa-contact-tracing.pdf?revision=6 https://www.mckinsey.com/featured-insights/middle-east-and c0f4b04-b793-4399-8037-5c561cfeb2ed&la=en-za) -africa/how-to-harness-technology-for-growth-in-south-africa) 7 Moyo, A. (2020). "R2M electronic food voucher system to 20 International Finance Corporation (IFC) & LEK. (2019). feed SA's poor", ITWeb. (Available online at: "Digitial Skills in Sub-Saharan Africa Spolight on Ghana", IFC. https://www.itweb.co.za/content/lwrKx73KwbG7mg1o) (Available online at: https://www.ifc.org/wps/wcm/connect/ed6362b3-aa34-42ac- 8 DGMT. (2020). "Digital food vouchers for social relief of ae9f-c739904951b1/Digital+Skills_Final_WEB_5-7-19.pdf?MO distress". (Available online at: D=AJPERES) https://dgmt.co.za/food-vouchers/) 21 Wangenge-Ouma, G. (2012). “Tuition fees and the challenge of making higher education a popular commodity in South 9 Techforgood. (2021). (Available online at: Africa”. Higher Education. 64, 831–844. https://techforgood.global/) https://doi.org/10.1007/s10734-012-9531-6 10 Code for South Africa. (2021). (Available online at http://code4sa.org/) 22 Chakravorti, B & Chaturvedi, R S. (2019). "Research: How Technology Could Promote Growth in 6 African Countries", 11 WEF & BCG. (2016). "Internet for All A Framework for Harvard Business Review. (Available online at: Accelerating Internet Access and Adoption White Paper", WEF. https://hbr.org/2019/12/research-how-technology-could-pro (Available online at: mote-growth-in-6-african-countries) http://www3.weforum.org/docs/WEF_Internet_for_All_Framew ork_Accelerating_Internet_Access_Adoption_report_2016.pdf) 23 Moed, J. (2018). "How technology can make South Africa a more equal country', Forbes. (Available online at: 12 International Telecommunication Union (ITU). (2019). "The https://www.forbes.com/sites/jonathanmoed/2018/08/15/ho economic contribution of broadband, digitization and ICT w-technology-can-make-south-africa-a-more-equal-country/? regulation Econometric modelling for the Americas". sh=583dda0aa86f) (Available online at: https://www.itu.int/pub/D-PREF-EF.BDT_AFR-2019) 12
Shared Value in the 4IR | Contributors Contributors Khutso Sekgota Andrew Lane Judy Hofmeyr Director, Strategy Director, Strategy Manager, Core Business Operations Deloitte Africa Deloitte Africa Deloitte Africa ksekgota@deloitte.co.za alane@deloitte.co.za jhofmeyr@deloitte.co.za Lungile Mahluza Harsha Desai Christine Chetty Director, Human Capital Senior Manager, Strategy Senior Consultant, Core Business Deloitte Africa Deloitte Africa Operations lmahluza@deloitte.co.za hardesai@deloitte.co.za Deloitte Africa cchetty@deloitte.co.za 12
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of No representations, warranties or undertakings (express or implied) are given as to the accuracy member firms, and their related entities (collectively, the “Deloitte organization”). DTTL (also or completeness of the information in this communication, and none of DTTL, its member firms, referred to as “Deloitte Global”) and each of its member firms and related entities are legally related entities, employees or agents shall be liable or responsible for any loss or damage separate and independent entities, which cannot obligate or bind each other in respect of third whatsoever arising directly or indirectly in connection with any person relying on this parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and communication. DTTL and each of its member firms, and their related entities, are legally omissions, and not those of each other. DTTL does not provide services to clients. Please see separate and independent entities. www.deloitte.com/about to learn more. © 2021. For information, contact Deloitte Touche Tohmatsu Limited. Deloitte is a leading global provider of audit and assurance, consulting, financial advisory, risk advisory, tax and related services. Our global network of member firms and related entities in more than 150 countries and territories (collectively, the “Deloitte organization”) serves four out of five Fortune Global 500® companies. Learn how Deloitte’s approximately 312,000 people make an impact that matters at www.deloitte.com. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms or their related entities (collectively, the “Deloitte organization”) is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser.
You can also read