My esteemed editor has once again outdone himself. As he has done on several other occasions over the past year or so, he has let his imagination run riot in trying to conjure up as many questions as possible to be answered as part of the featured topic for this month’s issue of his venerated magazine.
Instead of stopping at “What does 2019 hold in store for us?” he goes on to list five more perplexing questions that no self-respecting IT oracle can hope to answer without producing many millions of terabytes of marketing hyperbole that the IT industry is so famous for.
The questions referred to are:
- Will it be another tough 12 months, or is the industry and channel starting to emerge from the doldrums?
- Can we expect more of the same in terms of technology, or are we going to see even more innovative technology coming down?
- What will be the dominant trends for the year and where should companies be looking to make revenue?
- How should they be gearing up and what strategies should they be adopting?
- And just how will the market and its major players shape up as IT continues to evolve quicker than ever?
Perhaps the best starting point in trying to deal with these questions as well as hundreds of subsidiary questions that will inevitably arise in trying to come up with answers that even begin to make sense, is to concede that the entire IT sector in South Africa can hardly be described as a primary or even a secondary industry in the country’s national economy.
From the outset it should be understood that the South African economy, ranked as upper-middle income by the World Bank, is currently one of the largest economies on the African continent.
Historically, the economy was heavily reliant and based almost exclusively on primary and secondary industries such as mining, agriculture and manufacturing.
Although in recent decades, particularly since the lifting of economic sanctions with the advent of independence in 1994 and in line with globalisation trends, the economy has continued to rely on the same three pillars of economic activity but has also shifted towards tertiary industries such as finance, real estate and business services, as well as wholesale and retail trade.
It must therefore be conceded that IT is not an indispensable pillar of the South Africa economy, despite its significant contribution to the viability and smooth-running efficiencies of virtually every other industry sector in the national economy.
With one or two minor exceptions, no hardware or related IT peripherals of any significance are manufactured by local companies operating in the IT sector. To an overwhelming extent, computer hardware as well as telecommunications devices and major network infrastructural components are imported into the country under major multinational brand names from manufacturing facilities across the globe and in particular the Far East.
There are, or have been, some fine examples of locally-developed software applications and other solutions that have succeeded in the international market but not at a level that would define them as contributing to a defined industry sector its own right.
While local assembly of IT equipment remains reasonably active as a minor sub-set of the IT sector, its viability and potential for growth in the face of wildly fluctuating costs based on the exchange rate usually precludes this activity from developing into a primary or even secondary industry worth mentioning.
And so, my dear esteemed editor, one has to realise that what lies in store for the IT industry in South Africa in the year ahead is entirely reliant on factors that have absolutely nothing to do with the IT industry itself.
The IT industry – regardless of any “paradigm shifts” in technological innovation that may be on the way – does not drive economic growth in any way other than as a tool of business. Its fortunes therefore are entirely dependent on the needs of customers in the country’s major industry sectors.
Faced by the political turmoil that is bound to characterise an election year and the whims of financial market speculators playing games with emerging market economies around the world, the year ahead could be particularly tough.
The ability to take advantage of fleeting and ever-changing opportunities that support and help customers survive and thrive in the year ahead holds the key for IT players in this country.