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Ideas & Debate

Hurdles facing Africa innovation

Form left: Arab Bank Economic Development in Africa director-general Carlos Lopes, Safaricom chief innovation officer Kamal Bhattacharya and ICT principal secretary Victor Kyalo during the Innovation Summit Africa 2018  in Nairobi last week. PHOTO | SALATON NJAU | NMG
Form left: Arab Bank Economic Development in Africa director-general Carlos Lopes, Safaricom chief innovation officer Kamal Bhattacharya and ICT principal secretary Victor Kyalo during the Innovation Summit Africa 2018 in Nairobi last week. PHOTO | SALATON NJAU | NMG 

Last week, I attended the Innovation Summit organised by The Economist magazine. The event focused on digital transformation for accelerated growth in Africa. There are several points I want to share concerning the interface between the public and private sector, and innovation.

With regards to the private sector, an interesting point raised is that innovation targeting it must have a business case for adoption otherwise the innovation won’t be absorbed.

Innovation must demonstrate that the short-term inconvenience of adoption will pay off in the long term. The private sector is sceptical of ‘model changes’ and any model claiming innovation must be clear on the value it will deliver. So innovation must provide a proof of concept before it can be adopted and scaled.

Secondly, the lack of data in Africa means we don’t really know what the real situation is on the continent but more importantly it means that the data that we have is over-weighted and given extra significance that it not necessarily merited.

We have a real problem with information asymmetry and data bias. Data is the core of innovation so Africa must solve this problem if we are to make informed strategic decisions.

Thirdly, the private sector must deal with the fact that the lack of data on the continent impedes the absorption and spread of innovation. This is because strategies for market penetration and sharing cannot be rolled out since the lack of data means the private sector doesn’t know where the market sits.

So the private sector innovation may have created a valid solution, but the lack of data makes penetration and scaling very difficult.

Additionally, the public sector needs to know that rent seeking and corruption cancel the benefits that could have been accrued by innovation. Africa cannot fully leverage innovation with strong networks of corruption in place. As long as government engages in corruption, Africa will not fully leverage the benefits of innovation.

That said, the private sector is frustrated by the fact that sometimes its innovation is not quickly adopted by government. The state’s obligation to prevent harm leads to the slow adoption, a factor that may not feature strongly in the private sector lens.

Indeed, sometimes government policy is so stringent that it stifles innovation. But the question is, how can government policy be structured to foster innovation while ensuring it won’t inadvertently do public harm?

Another point of concern is what Africa needs to have in place to leverage innovation. How can Africa fully leverage innovation if basics are not taken care of? Sure we can leapfrog things like overhead telephone lines but innovation will be crippled if issues such as infrastructure are not addressed. Some basics have to be in place for innovation to really work.

Finally, often innovation in Africa is spurred by the lack of key services by government. The private sector develops a solution that plugs the gap that government services should fill. So what’s the way forward?

Does government enable the private sector to go on with the innovation or does it adopt the innovation and take over? What are the cost implications? Is there a mandate problem?

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