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Is SA’s tech space growing with a false sense of security?

Under-investment in technology infrastructure has added undue pressure on businesses trying to recuperate from COVID-19 disruptions. It has also highlighted the contrast between those companies that did not invest in infrastructure, have now incurred unplanned additional costs and must deal with additional labour requirements, and those that invested in IT continuously to help streamline operations.

It’s one of several issues plaguing the ICT and telecommunications services and supply chain in South Africa.

It also has business leaders scratching their heads wondering how to deal with the challenges, but also tap into obvious opportunities.

Cobus Olwage, COO of managed technology services provider IPT Holdings.
Cobus Olwage, COO of managed technology services provider IPT Holdings.

Speaking on the sidelines of distributor Pinnacle’s recent TechScape 2022 customer and partner conference, Cobus Olwage, COO of managed technology services provider IPT Holdings, said, “I think there are a lot of challenges and a lot of opportunities as well. The opportunities (are) specifically in the automation and digital transformation space … and modernising IT processes, as well as security.”

IPT Holdings focuses on the provision of full turn-key IT services to assist businesses to simplify their technology investment and bolster operations.

Clearly IT has had a significant impact on how businesses have dealt with – and continue to deal with the ramifications of the pandemic.

Pinnacle CEO Tim Humphreys-Davies said according to Gartner, overall global IT spend between pre-COVID 2019 and 2021, there has been 15% growth in end user devices (from US$1.4-trillion to US$1.6-trillion), and 16% growth in IT services, with 38% growth in enterprise software (from US$650-billion to US$900-billion) fuelled by increased investment in IT security solutions.

Despite the growth and surge in supply activity, Olwage is concerned about a false sense of achievement that he believes is creeping into the local tech industry, particularly within the hardware space.

“We can’t really give ourselves a pat on the back and think, you know, sales is up … there was a demand and we supplied that demand. So, in terms of the number of devices sold, that was a short-term requirement to get a lot of devices out there. In terms of the sales process, sales people, value to business… nothing changed, they just needed equipment. So I am almost concerned there is a false sense of achievement because I don’t really think we created value.”

However, the positive that can be taken from the scenario is that the ever-present gap between IT and business within companies has been reduced.

Olwage explains, “There’s been a wider gap between business and IT services departments, and the positive is that these are (now) definitely closer. So business understands dependency on IT and IT is definitely working to understand business better. Usually what we’ve seen is it operated almost in silos … with COVID-19 and digital transformation, IT has been prioritised. Going forward, what we need to do as an industry, the biggest issue that I foresee is the skills challenge in-country.”

This issue of having the requisite skills to handle technology will become more pressing as businesses re-adjust and adopt more technology solutions to support digitisation and automation says Olwage. “… (it’s) about understanding business and not just the technical requirements for business.”

Olwage believes going forward, in terms of channel distribution and enabling managed services providers, there will be continued diversification of services as suppliers look to cloud services, security software services and Microsoft-related infrastructure to reinforce delivery to managed services providers.

“They had a lot of dependency on hardware specifically and software specifically. And what we’ve seen since COVID-19 is that they are diversifying, which is very important in order to assist us to assist businesses.”

So while there is growth, more activity and a sense of optimism, managed services providers and other stakeholders in the technology supply space must be weary of complacency and an unchecked sense of achievement.

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