Challenges that IT-based firms must tackle in 2014

Growth, especially in the region, will form a key plank for strategy teams. FILE

By Mbugua Njihia


That IT is the next frontier for many African economies, promising to deliver big development payloads is not lost on anyone who has been reading the opportunity narrative of the Silicon Savannah, Silicon Cape and the various embodiments of the wave.

Trying to borrow a playbook from other markets may not work due to the unique challenges that one may face in Africa.

At the close of 2013, I took time off to reflect on what challenges the marketplace will present for my companies this year. Some, like access to capital, are the ever constant companions for any growing enterprise but others are coming to the fore as many verticals within the IT sector matures.

Whether as a services company doing integrations or pushing own product, this is my take on some of the issues that many C-level executives will have to deal with to remain competitive and in business over the next 12 months.

Pricing: Everyone wants to jump on the IT services bandwagon, and this cross-cutting demand comes with pricing challenges, as all potential clients want the same world class service and support but on vastly different budgets. Will you carve out a niche and ignore other market subsets? Or will you accommodate everyone with differentiated pricing?

Human Resource: It is not the best product or service that takes the day, but the best executed and supported with the latter being people-centric. The battle for talent will continue to shape up the business landscape this year as the supply of refined talent is yet to meet demand.

I expect musical chairs to drive up the costs for training and retention. How to manage that will be a key consideration.

Competition: Globalisation brings with it fresh market dynamics as foreign players, big and small, angle for a piece of the pie. New local players spring forth daily eyeing the same market.

How will you handle these new dynamics? Do you consolidate and collaborate or play your own game?

Growth: If you have some semblance of traction in your local market, growth often times takes the face of regional expansion.

Multi-country deployment

Are you positioned well, from a process perspective to successfully handle a multi-country, multi-partner deployment infused with execution discipline to allow for rapid response to the business environment both proactively and defensively?

Business has its uncertainties, and hopefully you have given those some thought and are armed with an adaptive strategy to meet these and other challenges as may arise.