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Posted by Mteto NyatiManaging Director, Microsoft South Africa
Broad-based Black Economic Empowerment (B-BBEE) is an initiative launched by the South African Government to address the restrictions that exist within the country for Black individuals to participate fairly in the economy. As part of its BBBEE programme, Microsoft is to invest R472 million - as well as skills, time, knowledge and best practices - to build several sustainable, independent majority black-owned software companies over the next seven years in South Africa.
We didn’t really need to be told by The Economist, of all publications, that black economic empowerment has been less than a resounding success in South Africa (http://www.economist.com/world/middle-east/displaystory.cfm?story_id=15824024).
We already knew that. As the article points out, even President Zuma seems to agree that BEE has resulted in a small core of super-rich black people who benefit from most BEE deals, while the intended beneficiaries – the millions of black people excluded from the mainstream economy by the apartheid government – have once again been left out in the cold.
Trade and Industry Minister, Rob Davies, says the country can only be transformed if empowerment plays its rightful role in business. Empowerment is not just a financial hand-out: it’s a vehicle for giving people the skills they need to make their way in business.
That’s why I’m particularly proud of the equity equivalence deal announced by my company, Microsoft SA, on 23 April. In short, we’re going to choose between five and ten small, black-owned software development companies, and pour a good deal of time, energy and resources into helping them become decent-sized companies that can stand independently on a global stage.
The highlight of this deal is not the amount of money that we intend to spend, although at half a billion rand, it’s not insignificant.
For me, what makes this deal different is a few things. One, there’s not a usual suspect in sight. This is not a box-ticking exercise. We’re not selecting these companies because of what they currently do, but because of what we believe they can become. We believe that if we pick good people, they will find their niche. We want to give smart people the break they need to fly.
Two, it’s got the potential to create an entirely model of entrepreneurship in this country. We’re looking to build businesses here.
Three, it’s going to create skills and jobs in a sector – and an economy – crying out for them. The country faces a significant shortage of technology skills, as well as chronic unemployment. This investment will tackle both by building a sustainable, black-owned technology ecosystem.
And four, it’s unique in that we’re not just throwing money at a generic problem, but backing it up with expertise, support and mentorship. In other words, we’re putting some real skin in the game here.
Obviously, there will be the cynics. There have been too many BEE false starts for people to be entirely convinced. But the fact is that this deal, at its heart, is a good business deal. The impetus for Microsoft is to be more locally relevant, and locally responsible in terms of social investment and BEE. Relevance and responsibility are critical aspects of being a local, committed corporate citizen, and this investment underlines our intention in a big way.
While development is key, we are balancing this with the commercial opportunities for all involved. The companies that grow out of this investment, and the software that they develop, will help Microsoft and its partners reach new markets. The investment should galvanise the local software economy and leave a legacy for other entrepreneurs.
Posted by Cheick DiarraChairman for Africa Microsoft Corp
Welcome all to the new Microsoft on the Issues Africa blog where leaders from across our company – as well as key industry partners - will be discussing the role of ICT as a driver of Africa’s development. It is the tool that will help and drive moving African citizens out of poverty, by supporting the creation of wealth and sustainable growth in the region. We can only do this, however, if we, in Africa, create the right policy environment, invest in the necessary infrastructure and act decisively and in a timely manner.
Investment is an integral part of the process, as we need to ensure that the local economy has the right financial infrastructure model in place to be able to effectively drive business capabilities. Of late, organisations such as L’Organisation pour l’Harmonisation en Afrique du Droit des Affaires (OHADA) have recognised how consistent policy making and legal structuring are crucial in establishing congruent, stable development and economic growth.
In addition to this, we at Microsoft are actively championing regional support of and attendance at meetings such as the Africa Union (AU) Summit, and the EU Africa Business Forum, which provide the opportunity to communicate the importance of ICT to Africa’s growth potential, to develop key business partnerships and to discuss ways in which companies can leverage ICT to overcome the barriers to trade and investment that they currently face.
Through all of this, Africa’s greatest resource is its people. It is an untapped reserve of one billion people, 60% of whom are under 30 – with huge potential to transform the continent towards prosperity if the right tools, knowledge, structures and policies are put in place. For Microsoft, this means delivering access to the relevant ICT tools, technology and hardware by partnering with other organisations and governments, both regionally and internationally, to facilitate entrepreneurship and business growth through sharing information, best practices and skills.
What is clear is that technology is going to play a long-lasting and meaningful role in addressing many of Africa’s challenges and that Microsoft, through working both with partners and independently, is committed to playing a key role in making this happen by taking advantage of the untold possibilities and untapped potential for wealth creation. If we work in partnership to provide the right infrastructures and the right opportunities then the citizens of Africa will do the rest.
I look forward to hearing your feedback and encourage you to share your thoughts and opinions on this subject.
Posted by Ali FaramawyVP Middle East and Africa, Microsoft
When Microsoft opened its first office in Africa in 1992, computers were a rarity and the majority of users either worked in multinational companies or at very senior government levels. Since then, we’ve seen IT play a crucial role in transforming Africa and its impact can now be seen at every level of society by empowering governments, businesses and people throughout the continent.
Throughout the last 18 years, Microsoft has become increasingly more active in contributing to Africa’s IT journey. Today, we have 600 full-time staff and developed over 17,000 partners from Alexandria to Cape Town. We have been working with our partners on the ground and listening to the voice of the local people in order to encourage their own remarkable entrepreneurial spirit towards the potential for ICT to transform society for future generations to come.
Today I’d like to invite you to participate in the next step of our commitment to Africa’s development journey by introducing the launch of a dedicated Africa portal. It will serve as an active communication forum to highlight the immense impact ICT is having on Africa and its people. Built on the success of “Microsoft on the Issues” launched by our colleagues in Seattle last year as well as the growth of the African blogging community, the “Microsoft On the Issues: Africa” blog will showcase the work that Microsoft and its partners are doing to help the continent thrive and grow. It will serve as a forum to discuss how we can best harness African innovation to help the continent advance to the next stage of development. This platform should also strengthen participation in wider discussions that support policy formulation to encourage an environment that welcomes the benefits of ICT.
I’m truly looking forward to the launch of this portal as a platform for discussion and an open forum for debate. It is a place for ideas and experiences to be shared with one another with the aim of promoting even better solutions to help accelerate Africa’s development journey. I strongly encourage you to share your own valuable experiences and unique perspectives by adding comments to the various posts and articles that will appear over the coming months.
To officially launch the blog, I would like to welcome our African chairman, Cheick Diarra, who will be discussing how successful partnerships are driving ICT in Africa. I hope that you will take the time to read and reflect on his valuable insights. Thank you in advance for your support and input and I look forward to reading your own thoughtful comments on our new “Microsoft On the Issues: Africa” blog.