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Expect a cycle of ICT investment in SA says Adapt IT

Expect a cycle of ICT investment in SA says Adapt IT

While South Africa remains its largest market, JSE-listed enterprise software and services provider Adapt IT is interested in expansion and believes its partnership-based go-to-market strategy for the rest of the continent will work.

Speaking to ITWeb Africa after the release of its results for the financial year ended 30 June 2019, chief executive officer Sbu Shabalala said following a period of uncertainty, the South African market is experiencing a turnaround and the market should expect a cycle of investment.

He attributes the turnaround to better investment in ICT.

"What we found was that when customers are under pressure, they start cutting IT budgets and they become quite familiar with what they have. So now that the market is becoming more competitive, they are looking for systems to create a value-add for them. So I think we are going to see a cycle of investment by customers into ICT, which will certainly help companies like ourselves in this sector," said Shabalala.

The growth of the country's ICT sector will be primarily driven by business demand for efficiency, he added.

Over the past financial year, the company centred its focus on business efficiency, profitability, strengthened support structures and transformation.

According to Shabalala the company used the year as a period of consolidation, bedding down operations at the new Johannesburg campus, fortifying the leadership team, and focusing on governance.

"Seeing that most of our software is already cloud-based, when customers buy, they can merely get deployment with minimal effort from us.... We're no longer resource-intensive when it comes to software implementation," he said.

Public sector key

Revenue from continuing operations increased by 14% to R1,438-billion and the energy division experienced a 30% decrease in revenue from a decrease in project revenue after several years of strong project revenue, contributing 9% to total revenue.

Shabalala said the company also used the financial year to implement governance within the business to ensure it has the correct people and processes to manage public services.

"We are now at a level where we are comfortable with taking on more public sector business. We've also clearly defined our focus in public services which is predominantly in the governance space, where we manage the development of large projects through our project management solutions and we do financial management reporting... e-procurement management solutions. We believe that focus will give ourselves a sufficient return and also help public service to implement better systems."

In terms of Africa, Shabalala said the aim is to intensify its existing presence within financial services and telecoms in East Africa, with Kenya front-of-mind at this point.

The strategy is to focus on local partnerships with businesses and service providers that are already established in these market segments. Although he confirmed there are potential partnerships in place, he could not divulge with whom, where or when these will be cemented.

"In turn we will ensure that whatever market we are in, we are able to take their solutions into those markets," Shabalala added.

He acknowledged that the company's Africa growth strategy is based on a careful approach leveraging local partnerships utilising local resources, and said that while South Africa is mostly business-centric in its adoption and implementation of software, the East African market is predominantly consumer-orientated in terms of solution s.

"So each market has its own nuances that we look at... there is no cookie-cutter approach around the Africa market. You have study the market, you have to be in the market to understand what will work for each one of these markets. And that's exactly how we approach it," said Shabalala.

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