From BizTech Africa

Africa’s emergence as a growth area is attracting interest from businesses all around the globe. SouthAfrican businesses are showing particular interest as they are on the spot and might be supposed to have a built-in advantage. For that reason, in fact, many overseas companies are seeing South Africa and South African companies as natural launch pads into Africa.

However, says Pete Frielinghaus, a Senior Business Continuity Management Advisor for ContinuitySA, companies need to be aware that Africa is not a single market, and that its economies are extremely diverse. This heterogeneity must be taken into account, and South African companies in particular must make a concerted effort to understand a very different set of risks, and not assume they “know” Africa.

“Expanding into new markets is intrinsically a risky business and so has to form part of the business continuity management cycle,” he suggests. “As Africa’s leading Business Continuity Management company, ContinuitySA has a bird’s eye view of risks that are common to many African economies. These 10 should certainly be considered when putting a business plan together and when thinking about entering the African market.”

Infrastructure. Overall, reliable infrastructure remains a key risk in Africa and there are no uniform standards deployed to measure quality. Roads are poor and in some cases extremely congested, with inevitable impacts on supply chain operations and movement of personnel. In addition, theft and vandalism further undermine the infrastructure while natural disasters also take their toll—for example, flooding in some parts and earthquakes in the Rift Valley in particular.

Power. Africa’s energy grid is chronically underdeveloped, something that’s worsened by increasing demand. Companies should therefore prepare for power outages and spikes, with the constant drone of backup generators rumbling on through the day and the night. Ensuring a regular supply of clean diesel should also form part of the risk-mitigation strategy.

Communications. As with the power grid, the communications infrastructure is inadequate for the growing demands placed on it. Even when fibre and VSAT infrastructure is in place, performance is not consistent due to incorrect specifications and poor maintenance. “A good example of an African country making tremendous inroads into correcting and strengthening this vital Achilles heel is Rwanda which is right at the top of the list in terms of cheap and reliable communications infrastructure,” Frielinghaus comments.

Political issues. Overt conflict is ongoing in a number of African countries but often apparent political stability masks undercurrents of contention. The direct impact of political turmoil is obvious—what may be less so is the link between conflict and corruption, which in turn affects the business environment in many subtle ways. Staff evacuation plans should be in place with a reputable service provider.

Read more at BizTech Africa