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South Africa no longer Africa’s obvious leader in innovation

South Africa no longer Africa’s obvious leader in innovation

South Africa’s position as the most innovative nation in Africa appears to be under threat from a reading of the newly released Accenture Innovation Index 2017 which shows only marginal growth in innovation among South African companies.

The Index recommends an acceleration of the pace at which the nation is innovating if it hopes to continue to compete in the 21st century.

William Mzimba, CEO of Accenture South Africa and Chairman of Accenture Sub-Saharan Africa confirms that South Africa is beginning to lose its place as a frontrunner in innovation across the continent.

“The findings are actually telling us that we are in trouble. They show that we are beginning to lag behind. In many other indices that you look at you will be able to see that there are other countries that are beginning to adopt technologies faster than we are, they are beginning to innovate much more intently. This is clear in Kenya for example, in Ethiopia as well and even in Rwanda where you can see the flow of foreign direct investment starting to go into those countries and innovation being exported from those countries into other places.”

Mzimba says South Africa may soon lose the popular view of the country as a “gateway into Africa” and will likely suffer resultant losses in investment that would have aided the country's enterprises and entrepreneurs. He adds that South Africa’s sluggish economic growth which saw a 2.5 percent growth in GDP during the second quarter of 2017 is not necessarily a contributing factor to the innovation slow down.

“Innovation comes out of hardship. At this moment we should be thinking about how we will get ourselves out of the quagmire of low growth, unemployment , poverty et cetera. What is missing in our country is that burning desire to want to work ourselves collectively out of the situation that we are in. You will hear the narrative about blaming the government, about finding white monopoly capital and putting the blame on it but we should be getting our heads down and bring together our collective genius and just solving the problems we have. How long have we been talking about the poor state of education? Every year government puts over R200 billion into that system! Why can’t it find innovation so that we can solve how education is delivered? It is the same in healthcare. We need to just get on with it.”

South Africa’s score on the Index increased by just two points from 2016 to reach 52 points in 2017, and by six points over the last three years. This growth is, however, not advancing at the pace required to translate into stable economic growth according to the Index which Accenture compiled in partnership with the Da Vinci Institute and TransUnion.

“Top line results from our analysis suggest that South African companies at large are taking a defensive stance – innovation is taking a back seat as companies grapple with economic uncertainties. In fact, South African companies are not even spending their allocated budget on innovation: on average, companies are putting aside 45 percent of their annual revenue for the development of innovations, yet actual spending is cautious and conservative at 36 percent.”, details the Index.

The Index also found that in a rapidly digitising business environment where new players are disrupting traditional revenue streams across all industry sectors, it is now more important than ever for companies to be step up their innovation game.

Paul Nunes, Global Managing Director at Accenture Research says innovation can take place in virtually every industry through the power of technology.

“You have to innovate at the pace of the fastest technology in your industry now. What happens is that in rather staid and slow industries like pulping paper or mining because of the technology that come into it, you can't you have to innovate at the pace of autonomous technology.”


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