The 3rd Annual EAC SG Forum

1. The 3rd Annual EAC SG Forum Integrating ICT, BPO and Mobile Platforms in the region: Opportunities, Challenges.Jean Pierre NIYITEGEKA / GOR

2. I Contents • Introduction (ICT, BPO) • Trends in ICT, BPO & Mobile technologies • Opportunities & Challenges • Towards integration

3. 2 Highlights on ICT • The EA countries have strong will to position ICT as a key enabler for social economic transformation. • Several key developments in ICT have been realised by each member states, however, there is to further leverage on ICT capabilities to accelerateregional integration. • The integration has to be aligned from strategic positioning, projects and at operational level. • Infrastructure, Application Systems, Policy formulation, * EA Citizens should benefit from the same user experiences among all the member states *

4. 3 Highlights of Rwandan’s best practices As of today: • 20% Internet penetration • 65% phone penetration in population • 4G coverage of 75% Kigali 95%4G Country wide coverage by 2017 • Country wide coverage of ICT infrastructures • Smart Rwanda Master Plan Clear Strategy with concrete actions • All Govt Services to be served online. Started with 100 common services

5. Potential areas of intergration/Harmonization 4 Integrated Broadband Strategies Harmonized Services/E-Gov Strategies Harmonization of Policies (Smart Rwanda) East Africa Integration Financial Services EA wide Cyber Security Harmonization of Telecom Tariffs Citizens Registry Centralization EA exchange point

6. BusinessProcessOutsourcing(BPO) 5 • Some Definition of BPO: • Outsourcing is when a company contracts with an outside provider for services or other business processes, rather than employing staff to do these services in-house. • Typically outsourcing is done with an eye toward efficiency and cost-saving for the company. • Typically, the BPO services are provided in the area of logistics, Sales and Marketing, Customer Care, Finance, Human Resources but many other traditional business processes are being converted into BPO. • BPO is now global with the advent of ICT. Taking advantage of various different factors (e.g.; time difference, skill sets, languages, prices, etc.), many private sectors and public institutions are utilizing services which do not conform to traditional market pattern.

7. 6 Advantages of BPO for organizations Advantages of BPO: Targeted approach to meet the needs of demanding customers. Figure 7: The key benefits of outsourcing[ [1] Source: OTF Group BPO market survey, 2010: n=136

8. BusinessProcessOutsourcing(BPO) 7 • Current Status of BPO Market and Opportunities: • Global BPO market is forecast to increase at a 5.7 % annum (CAGR) to $209.4 billion by 2017 (IDC 2013) • Logistics, Sales and Marketing, Customer Care, Finance, Human Resources represent 98% of the BPO Services (IDC 2007) • EA BPO market is expected to grow from $485 million to $1.9 billion with an annual growth of 25 percent from 2010-2015 (OTF 2010). • Rwanda estimates that the current domestic demand for BPO services is $50 million, with a target to increase to approx. $274 million in 2020 (OTF 2010)

9. 8 Key highlights • This growth of BPO is driven by an overall change to business models worldwide. BPO has a limited presence in East Africa; however, the growth forecast suggest to surpass the global growth rate • In the recent survey conducted by OTC, 70 of the respondents are based in Rwanda, 43 in the East African Community (EAC) and outside of Rwanda, and 23 are international firms. The median company size was twenty-four employees and the average size was 282 employees. This difference was due to several large companies that participated in the survey. • Gross Domestic Product (GDP) growth in East Africa led African growth in 2008, with an average of over 7%, according to African Economic Outlook. As East Africa swiftly expands and enters the global marketplace, corporations are outsourcing more of their business.

10. 9 BusinessProcessOutsourcing(BPO) • BPO Challenges for the region:. • Workforce skills: Low skill levels among professionals • Infrastructure: High energy cost, telecommunication costs, low band-width • Funding: Difficulty in accessing working capital/funding for growth • Procurement Policies: Government tenders do not promote competition • Marketing outreach: EA still lags behind marketing itself as a destination for BPO • Management skills: management lacks globally competitive operational experience • Investment: Additional targeted investment required for sustained industry growth • Lack of distinct services: Inability to pursue services that are unique but at the same time very standardized and high in demand globally.

11. 10 BPO Enabling factors • Skills Development • Address the Academia – Private Sector disconnect • Reduce the cost of existing ICT certification courses that is prohibitive to students • Reduce the prohibitive cost of training Rwandan employees • Infrastructure • Create reasonable energy and telecommunication costs • Access state of the art labs/ cutting edge information • Increase access to finance • Create working capital • Increase start-up funding • Increase access to public and donor procurement • Language training initiatives • Management training initiatives • Attracting the expertise and investment necessary to create anchor firms

12. BPO Suggested EA Position for discussion 11 • Suggested EA position to take advantages of BPO:. • Need to create distinctive yet highly sought after services to be globally competitive • Avoid price competition (move existing BPOs to higher valued services) • Create regional market for the BPO sector to be competitive (e.g.; South Africa) • Create appropriate skills in the region to enable distinctive BPO services from EA • Take advantage of members such as Rwanda and Brundi to connect West African Market and EA (especially in the linguistic advantages – French, Lingara, etc.) • Create regional BPO Strategy to include above points which will be coherent and take advantage of regional integration • Etc.

13. 12 Mobile Applications/Services E-Services M-Services As we develop E-services, lets think of M services. Other countries no longer talk abut E but M

14. Definition of Mobile Services (m-Services/applications) 13 Sample definition of Mobile Services and Mobile Applications: Any services which are intended and created for, distributed and disseminated by, transacted and consumed through various different devices which are transportable in nature. With the advent of ubiquitous mobile devices and interconnections, Mobile Services are quickly becoming mainstreamed in both developed and developing countries as most efficient ways of providing and consuming services between the service providers and the consumers. Mobile Applications are tools (often software based) which enable mobile services to be delivered through devices which are transportable in nature.

15. 14 Why Mobile Services? • Current outreach of Mobile Services: • Portio Research (March 2013) estimates: 1.2 billion people worldwide were using mobile apps at the end of 2012. This forecast is to grow at a 29.8% per annum and reach 4.4 billion users by the end of 2017 • Huge mobile penetration in Africa (253million unique mobile subscribers), Annual growth rate of 18% CAGR-2007~2012 (GSMA 2013) • Nearly 94% of the users access Internet via Mobile devices in Middle East and Africa (eMarketer 2014)

16. Why Mobile Services/Applications? 15 • Some Advantages: • Huge subscriber base (nearly all Internet based services are accessed through mobile devices) • Cost effective to both develop and provide services through Mobile based applications • Transactions are less prone to corruptions and other hindrances • Monetary transactions can be performed with relative ease with mobile banking and mobile payment systems (e.g.; m-Pesa) • Etc.

17. Why Mobile Services? 16 • Some Challenges hindering m-services/applications penetration: • Stagnant Mind set from traditional service delivery and consumption • Cost of accessing Internet and SMS • Existing policies/laws/regulations do not support mobile services/applications • Low penetration of Internet and mobile devices in rural areas • Low skills in development mobile applications • Etc.

18. How could we encourage growth of m-services/app 17 • How to encourage growth of m-services/applications: • Change of mind set for the service providers (e.g.; Government institutions) • Low skills development • Outsource various different Government services to private sectors • Reduce Internet and SMS costs and encourage penetration of low cost smart mobile devices • Provide capital for investment in mobile application development (e.g.; contests, loan scheme, etc.) • Create EA framework for m-services (for seamless transactions) • Encourage skills development in the area through targeted approach • Facilitate legal frameworks which are conducive to m-services/applications • Etc.

19. Asante……Discussions !