Strategies for Positioning Nigeria in the Global ICT Market

Being a paper presented by Dr Jimson Olufuye, ITAN President and Board member WITSA at the 2010 eNigeria Conference with the theme: Nigeria’s ICT4D Plan and Global e-Payment …

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Jimson-OlufuyeBeing a paper presented by Dr Jimson Olufuye, ITAN President and Board member WITSA at the 2010 eNigeria Conference with the theme: Nigeria’s ICT4D Plan and Global e-Payment Adoption Ranking: Implications for Vision 20-2020.  

 

1.0 Preambles

 I would like to thank the Director-General of NITDA and members of the eNigeria 2010 Planning Committee for inviting me to the Conference and to make a presentation on Strategies for Positioning Nigeria in the Global ICT Market. I would also like to use this opportunity to thank all my professional colleagues that worked relentlessly on the Nigeria’s ICT4D Plan and on the revised National Information Technology Policy.

 In this paper, I’m to concern myself with the strategies for positioning Nigeria in the global ICT market.  In the normal sense of going to the market like the stock market, it presupposes that you have something that you want to sell. In stock markets, stocks are traded. If you have stocks to sell you simply go to the market and dispose them. The same thing applies for yam market. When you go to the yam market, it is expected that you have yams to dispose or you want to buy some. In the case of global ICT market, it means people have ICT products and services that they want to dispose to get an income or products and services to buy. In case of Nigeria, one then can ask, what do we have to sell in the global ICT market place? What peculiar competitive ICT advantage do we have that the world wants? (The answer is obvious nothing significant yet!)

 

 An old proverb says that ‘If you want to sell a rabbit skin, you do not talk about it until you have caught the rabbit’. However, I do know that in a Nigerian culture, long before the masquerades come out, the sound of the drum would have been in the air, loud and dominating. It is like preparing the ground and setting the pace for what to come.

 

 In this light, I subscribe to the strategy of deliberate positioning of Nigeria for reckoning in certain field of competitive advantage in the global ICTs marketplace in lieu of actual delivery.

 2.0 The Global ICT Market

 

 The global ICT market is worth more than US$4trillion according to the WITSA 2008 Digital Planet Publication. There are four Technology groups in the global ICT market namely: Hardware, Software, Services and Communications. The communications services and equipment group has by far the largest share of total ICT spending with about 45% in 2009. The services group has the second largest share at about 25%, while hardware and software hold about 18% and 12% of the market, respectively.

 

 The services sector readily guaranties economic expansion as it has the capacity to quickly expand and scale up more jobs. Nigeria is currently around 30% of its Service potential. A 78% Services level is critical to the attainment of the Vision 2020 target. Services component includes Business Process Outsourcing (BPO), IT consulting, Research, Education, Hospitality etc.

 

 There are six key drivers of the global ICT market. They are Innovation, Investment, Intellectual capital, Information flow, Infrastructure and Integration. Nations desirous of playing major role/s in the global ICT market place must engage the six ‘i’s above to be taken seriously.

 

 2.1 Questions

 

The questions can then be asked; In what Technology Groups are we now? …. And in what Technology Group can we play?

 

2.2 Answer

 

 In BPO and Software development!

 2.3 Why?

 

 We have the key ingredients in abundance viz

 1.   Human Capital. More than 150m people with vibrant youth population.

 2.   Language advantage. English language

 3.   Geographic location: Same time zone with Europe. So real time processing practicable. And to the United States just 5-6hrs difference.

 4.   Investment: World Bank ICT Project funding to the tune of about US$180m, National Information Technology Development Fund, EU funding support and massive private capital.

 

 2.4 Drawbacks

 

 

1.   Absence of critical mass of talent, skills and competencies

 2.    Infant process-people-technology (PPT) cycle. This needs to mature. For Example- there is no certified company in Nigeria on the CMMI model- which is a global process and quality standard for Software Companies

 3.   Poor Electric power. This drives high the cost of doing business

 4.   Lack of instrument of law

 2.5 Solution

 

ITAN has partnered with a QAI Global (a global leader in Process, Quality and Operational Excellence Consulting and Workforce Development) to prop-up our PPT curve into maturity in the area of IT/BPO services. World Bank has engaged Hewitt (another leader in BPO industry development) to step up our BPO industry to attract big BPO businesses to Nigeria. The BPO service industry is a US$500b market and it is ONLY about 25% engaged.

 

 The leading BPO nations India, China, Malaysia, and Philippines etc are getting increasingly expensive and it’s time to explore cheaper opportunities as business is concerned with minimizing cost and maximizing profit. South Africa and Egypt are current African leaders in BPO. However, if we rejuvenate the momentum, we can readily come from behind to lead again just as we did in telecoms from 0.05% to 50% density in less than 10years. ITAN and QAI are ready to partner with NITDA and key stakeholders for critical PPT service excellence and workforce skills.

 The issue of electric power did not stop the telecom sector why should it stop the IT/BPO sector? The alternative being the generators, turbines and independent power are to the rescue. The omnibus Senator Iya Abubakar IT Bill which handles cybersecurity/ cybercrime, electronic evidence and digital signature may be lobbied to passage.

 

  WE MUST GET IT RIGHT AGAIN IN IT/BPO services!

 3.0 Importance of Positioning

 

Position determines relevance, prominence and leadership. Position can be likened to visibility. The more visible you are the more your degree of influence, reckoning, value and dependability. These are critical to business.

  If we truly want to be one of the 1st 20 biggest economies in the world by the year 2020 (V20-2020[3]), we must seriously begin to position ourselves for digital competiveness.

 3.1 Rand Corporation Report

 According to a recent Rand Corporation report: “For the past 30 years advances in biotechnology, nanotechnology, materials technology and information technology have advanced at an accelerated rate with no signs of abating.  The technology in 2020 will integrate developments from multiple scientific disciplines in ways that will dramatically impact the quality of human life even more than can be imagined today.  It is sure to change the face of work, education, economics, energy, the environment, medical care and global political power.

 

 Rand points out however that this technology revolution will play out differently around the world as not all countries will be capable of taking advantage of it.  Some countries will not be capable because they will not have the necessary infrastructure or resources to integrate the technology applications within their societies.

 

 We have entered into a new global, knowledge based economy- where independent economies have merged into an inter- dependent economy.  We are witnessing an ongoing process by which regional economies, societies, and cultures have become integrated through a globe-spanning network of communication and trade enabled by Information and Communications Technologies (ICT) thus recognizing that ICT is THE key driver of global economic growth and development.  Almost everything that we know and do today is about to change again and again.

 It only stands to reason therefore that those economies and societies that are not fully engaged and integrated into the global economy by embracing ICT will surely fall further and further behind those that are. 

 

 To make matters worse, the rapid rate of change is making it more difficult to catch up.  So the longer economies delay the more difficult it will be for them to catch up. 

 SHOULD WE STILL DELAY?

 3.2 World Economic Forum

 

 In 2009, the World Economic Forum reported that Information and Communications Technologies are increasingly moving to the core of national competitiveness.  Deductively, unless a country embraces ICT as its key enabler and centers ICT at its core of operations in all aspects of society it is near certain that in this new age these countries will not be able to compete. 

 4.0 Strategies for positioning Nigeria in the global ICT market

 

Our respectability in the global ICT market depends on what we do and what we do not do.

  4.1 What is it that we must not do?

 

 1.   We must not standby and allow the digital revolution pass us by

 2.   We must not be an on-looker.

 3.   We must not allow internal wrangling to slow us down

  Let us be determined to move forward!

 4.2 What do we do?

 

The bottom line with regard to whatever we do is to create jobs and enhance the prosperity of our people. Here are a few things I think we must do:

 1.   Have an IT Policy to set direction

 2.   Have a strategic plan of action to develop the industry – ICT4D[4]

 NITDA must proactively engage ICTs with solid strategic plans in phases to drive Vision 20-2020. There should be a Committee or a group (powered by NITDA) charged with this task. If there is none in place, ITAN hereby volunteers to join the group that would make that possible whenever it is constituted.

 3.   Concentrate on low hanging fruits: That is BPO, software development, African contents development just as with Nollywood etc. We must boost our service sector.

 4.   Enact laws to assure confidence in the economy. The omnibus Senator Iya Abubakar bill may be revived. (The above Committee or group can be charged with this mandate as well.)

 5.   Stream line taxation. Multiple tax regimes cripple business.

 6.   Generate industry data. Data is the life blood of any digital economy after human capital. If there is no data, you cannot measure progress and if you cannot measure progress then you cannot attain your goals talkless of your vision.

 7.   Create IT Public-Private Institute. NITDA as an IT development agency needs to push for the creation of what I can call its research and innovation arm – the IT Public Private Institute (IPPI). NITDA needs this institute akin to Digital Bridge of Nigerian Communications Commission (NCC) to focus on research and innovation that shall be the blazing engine for the fulfillment of its development mandate. The IPPI should engage mostly PhD holders to assure research and innovation quality and integrity. It could draw strength from works of innovation scattered around research institutes around the country and also collate and provide cutting edge training methodologies and contents to University dons who will in turn impact knowledge of current technology tools and practices to students who are the supply line for the service sector and the general ICT ecosystem.

 8.   Use NITDEF fund to

 i.       build awareness amongst Nigerian IT organizations regarding various aspects of Operational and Business Excellence

 ii.     Assist IT organizations to develop and implement a comprehensive ‘Operations Excellence’ roadmap that enhances their global competitiveness.

 iii.   Deploy global frameworks, standards and certifications for the IT industry such as: Capability Maturity Model Integration (CMMI®), People Capability Maturity Model (PCMM®), ISO 20000, ITIL, CoBIT, 6-Sigma and others, in order to improve competitiveness, attract outsourcing  opportunities, and promote Nigeria as a ‘high quality ICT destination’.

 iv.   Create and implement industry wide projects for ‘Enterprise Capability Building’ in areas such as, but not limited to Software Process Improvement, Business Process Improvement, Outsourcing Management, Quality Management, IT Governance, Innovation Management, Human Capability Management, Program & Project Management, Software Engineering, Software Testing Centers. Create workforce development initiatives such as training and certification of students and working professionals in the IT-BPO industry, and upgrading of University curricula as well as Professors, for creating mass-scale pool of industry aligned and ready graduates, and working professionals.

  Egypt for example has already taken several initiatives in the above areas, where all the stakeholders in the ICT ecosystem are working together (such as the Ministry of ICT, Ministry of Education, local industry association, IT/BPO companies, Training companies etc. are working together towards building capacity and positioning Egypt as an Outsourcing Destination.

 The strategy has delivered results, with several global MNC’s such as IBM, Oracle, Vodafone, Microsoft, etc have set up operations, investing capital and generating employment, while Egypt is touching 1 billon USD of IT/BPO exports.

 9.   Be visible. There is need to engage international trade bodies like the World Information Technology and Services Alliance (WITSA), Computer and Electronic Association (CEA) etc as a way of attracting more visibility. ITAN is already a member of WITSA. NITDA can leverage on this to become a global partner of WITSA. The US, Malaysia, MexicoIT and Taiwan are members already. Global partnership with WITSA has enhanced in no small measures the economies of such partners. For example, the partnership gave Malaysia an unprecedented leap as a major BPO destination in the world behind India and China. I am glad that NITDA will be present at the upcoming World Congress on IT (also known as the ICT Olympics) in Amsterdam. It is a veritable environment to begin to position Nigeria as a serious destination for BPO. Though there is no plan to have Nigeria country pavilion and displays but it would be a good presence all the same.

 5.0 Conclusion

 With our positioning strategy in view, I hereby in conclusion propose that NITDA

 i.       Becomes a global partner of WITSA, CEA and other important global bodies

 ii.     Set up an IT Public-Private Institute (IPPI) to drive the IT Public-Private Forum and spearhead NITDA research and innovation drives. The IPPI is expected to be the blazing engine for NITDA in the fulfilling of its developmental mandate.

 iii.   Sponsor trade missions for Nigerian hardware and software companies overseas

 

iv.   Hold West African IT trade exhibitions for Nigerian IT services and products in collaboration with key trade associations

 v.    Use the NITDEF Fund to assist IT companies build Operational and Business Excellence and some promising software companies to achieve international certification such as CMMI for global competitiveness.

 vi.   Projects to host the Global Public Policy Summit by 2016 and

 vii. Projects to host the 2020 edition of the World Congress on IT – WCIT 2020.

 Again I say, if Nigeria in less than ten years could record the telecom revolution, then there is nothing stopping us from cheetapolevaulting with ICT by the year 2020.

 Let us make the Digital Nigeria happen. Let us make it a reality as WE WORK TOGETHER!

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