Business
Winning in Africa
Collectively, these forces have promoted the development of more diversified and sustainable national economies. “Africans have good reason to be optimistic and enthusiastic about their future,” said Stefano Niavas, a BCG partner and another report coauthor. “The continent has undergone a revival that few people were predicting 15 years ago.”
Winning in Africa lays out an approach for companies to take advantage of these trends by addressing 5 specific African realities.
– Africa is the final frontier. Africa is the last sizable area of untapped growth in the global economy. But given the operational challenges, companies will need to bring Africa into the boardroom to ensure continuity, commitment, and persistence. Unless Africa is a C-suite initiative, the effort will be wasted.
– There is not just one Africa. Clusters of African countries share language, culture, borders, and trade and financial agreements, but they all require vastly different approaches to strategy, organization, and business. Companies need to address this diversity.
– Talent, market knowledge, and risk are bottlenecks. More so than in most other emerging markets, talent and market knowledge are in short supply in Africa. Political, economic, and governance risks remain in many markets. Consequently, companies must invest aggressively in people, market intelligence, and risk management.
– The African customer is rising. Companies must develop products, services, and brands that resonate with consumers and business customers. Because distribution is so challenging in Africa, companies need to have sufficient control to ensure that goods and services are delivered as promised into the heartland and not just along the coast.
– Africa has an ambitious development agenda. African leaders are diligently working to improve the social infrastructure of their nations, to create jobs, and to generate higher-value economic activities. Consequently, companies should figure out how they can help countries achieve their development goals while also making a profit.
“Success in places like China or India will not necessarily translate into success in Africa,” said Tenbite Ermias, a BCG partner and coauthor. “But companies that figure out how to build deep and lasting businesses in Africa will be handsomely rewarded because the barriers to entry remain formidable.”
