Data from the Dell Technologies digital transformation index 2020 indicates what many already suspected: that the pandemic has accelerated SA’s digital journey, despite the economic pressures of the lockdown. It’s a silver lining in the flurry of otherwise dire statistics as SA and the world count the costs of 2020.
The index, released last month, is a global study of about 5,300 C-suite respondents from 23 countries. It indicates that 79% of SA organisations have fast-tracked their digital transformation (aligned with 80% globally), and 84% are "reinventing their business models" around digital, against the global average of 79%.
Examples of this digital transformation include using chatbots to answer routine customer inquiries.
The index report finds that SA businesses have been investing in edge computing and artificial intelligence (AI), on-demand digital services, and — naturally — converting workplaces to be more digital.
The top three barriers to digital transformation cited by SA respondents are: lack of budget and resources (45%); not having the right tech (35%); and the lack of economic growth (39%).
Doug Woolley, MD of Dell Technologies SA, says there has been "substantive, measurable progress [in the category of] digital leaders in SA". These are organisations with "digital ingrained in their DNA": 8% of SA respondents are classified as such, two points above the global average.
"Digital adopters" are organisations that "have a mature digital plan, investments and innovations in place", and the index shows a 20 percentage point increase in this category locally, since the previous survey (43%, up from 23%) in 2018.
Woolley says the pandemic has "placed technology front and centre of recovery", with 84% of businesses in SA recognising the need to be more agile with scalable IT infrastructure that allows them to cope with the unexpected.
But not all local industries are so far advanced.
Data released last week by the International Data Corp (IDC), in the "Middle East and Africa Chief Innovation Officer Survey 2020", found that 64% of insurance organisations in the region are "stuck in the early and middle stages of digital transformation". The IDC says a mere 11% are at the advanced or "optimised" stage.
Clickatell CEO Pieter de Villiers tells the FM that insurers have focused on "tactical implementations of AI over strategic deployment" because of cost savings, among other things. He adds that "some more established insurance companies are also challenged by decades-old legacy core systems".
Chatbots have the potential to make a big impact, due to the widespread adoption of chat apps in the country. Citing "Digital 2021 SA", a January 2021 Hootsuite and We Are Social study, De Villiers says WhatsApp is SA’s top app, with almost 94% of SA internet users using it in the past month.
He adds that local insurers are now using chatbots in their call centres and on the web for sales and service, but successful implementations tend to have bots and humans working in tandem.
"People know when they are dealing with a bot. [Largely] when it comes to high-frequency, low-complexity issues, we are more than happy to deal with a machine. But [for] solving complex business problems, a handover to a live agent is still vital," he says.
Finally, smaller companies can use digital tools to compete with bigger, better-resourced companies. Jesse Weinberg, head of the SME customer segment at FNB, says smaller businesses "will only ever be as digital as the basic systems that they use to run their businesses".
An example he offers is the use of software for accounting automation. Next, he expects these smaller businesses to embrace online banking, e-commerce storefront software, couriers and even customer service management software.
"With the pandemic forcing SMEs to fast-track their adoption, we can expect a rapid increase in their digital transformation as a result," Weinberg says.
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