MTN Ghana CEO, Selorm Adadevoh has said the post-Covid-19 normalization period promises a flood of investment across Africa but small and medium scale enterprises (SMEs) would need to position themselves strategical to benefit from that flood.
Selorm Adadevoh made the remark in a virtual forum organized by UBA Bank under the theme “Re-strategizing business to remain competitive post Covid-19”.
He observed that due to the pandemic, loads of investors interested in Africa held back their money because of the obvious risk, but they did not invest anywhere else either because the risk was everywhere.
For most businesses, the demand side went down and the supply side also suffered due to low liquidity and stalled investment due to the pandemic risk.
According to him, the situation led to a huge hoarding of cash by investors who would begin to look for attractive opportunities on the continent to invest, and it would take SMEs strategically positioned to benefit thereof.
Explaining how SMEs can strategize and attract a chunk of the investment flood, he said investors would be looking for SMEs with a certain degree of skill that can create a global presence and global product to meet the need of customers across the globe.
“Indeed, SMEs with skills to create global products are largely lacking in African economies and so those who would focus on that and transform themselves into global players would attract the necessary investment post-Covid,” he said.
Selorm Adadevoh noted that SMEs in Africa are a bit too country specific – so, their products quality hardly meets global standards and that is a put off for investors because export potential is low.
“The sub-skill mentality needs to change among SMEs in Ghana and Africa – the culture needs to shift to a global one because post-Covid, many more businesses would be competing for investor funds on the continent,” he argued.
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He also urged SMEs to take advantage of the Africa Continental Free Trade Area (AfCFTA) to help drive the ambition of SMEs to become more of pan-African, regional and global players rather than just local local players.
The MTN Ghana CEO noted the pandemic has also exposed the reality of the digital divide and the survival of every business going forward depends largely on how they transition from a less digital to a more digital player.
He said the key factor that will push SMEs from local to global players is digital transformation, saying that investors would expect to see SMEs which are taking advantage of the huge global market on digital platforms to expand their reach digitally.
“Customers are going digital and they expect to be served in that space so investors would view SMEs with aggressive digital strategies as the ones with global potential and worth investing in,” he said.
He urged SMEs to quickly respond to consumers’ changing taste and needs in the market place, saying that the survivors post-Covid are those who are meeting the changing demands of the consumer today.
“People want to be served digitally and your competitors are there serving them, so you better get there quickly,” he said.
According to him, beyond being a survival strategy now, digital transformation is also key to creating a business that is future shock-proof because digital is no more a luxury but a necessity.
Confident in SMEs
Selorm Adadevoh however stated that he is excited about the SME space because it represents a huge potential for Africa, adding that “if we think of how we can grow African economies it really lies with the SME sector so there is a lot we can do with them.”
He noted that contribution of SMEs to the economy is very significant, so impact of Covid-19 on SMEs ultimately affects the entire economy. But he is confident that as SMEs begin to transform to attract investment during the recovery period, African economies would be impacted positively.
Emphasizing the need for businesses to be ready for different types of shocks, he urged them to focus on creating portfolios that would ensure revenue diversification – so that if one revenue line is down, the other can support to ensure sustainability.
He also stressed the need for SMEs to invest into the health of their workers and create environments where the workers can be more efficient to ensue maximum result in the face of the changing consumer demands.
Partnerships on Consumer Data
Selorm Adadevoh said the shift to digitization has also thrown up the need for partnerships in consumer data generation, management and sharing.
“The value of data cannot be overemphasized in this whole drive. The collection of consumer data is becoming very key now in order to serve them better – If you don’t have good consumer data, it will be to your disadvantage. Your customer value management will be poor,” he argued.
According to him, personalizing offers has become very key – and Facebook, Google are way ahead of the game, but African businesses need to catch up through partnerships because it is an imperative for competitiveness and relevance in the market place.
He explained that partnerships would mean various businesses could have access to one set of data and derive different dimensions of value from it to serve their specific needs.
“This save cost and the hustle of every individual business having to collect and or generate their own data only to use one or two aspects of that data,” he said.
In line with that, MTN is for instance, pursuing a a strategy dubbed Ambition 2025, where it will open up its platforms to various businesses to plug in and use the available resources, including the customer data to create and provide solutions outside of MTN.