Doing Business in Africa

DOING BUSINESS IN AFRICA...................STRATEGY TO EXECUTION

FIVE CRITICAL SUCCESS FACTORS

African markets are increasingly open for business. Despite perceptions of elevated  and uniform risk, in many ways, the continent is no different to others. Sound business  practices enable well-run firms and funds to convert business strategies into actual  results. Yet the continent’s rich diversity and undoubted complexity make it possible  to identify five strategic critical success factors that will likely distinguish success from
failure when executing an African growth strategies.

Perspective

The eye of the beholder: African business ventures can be risky, but  no more so than those in much-hyped emerging markets in other  regions. Giving substance to your Africa strategy involves a choice:
one can emphasize a search for opportunities and then factor in  risks accordingly, or take a “risks-first” approach and only weigh  opportunities after first filtering for risk. Successful entities have  tended to do the former.

Planning

Patience and persistence = results: while it is often said that  rewards go to the bold, in African investing it is also true that patience  is a virtue (and pays). Experienced foreign investors repeatedly note  that nowhere else is there such a direct correlation between careful  planning (and flexibility about plans once formed) and a successful  outcome.

Places

Seek platforms and hubs: Africa’s hallmark is diversity; the barriers  to creating bigger and deeper common markets and trade areas are  considerable, but are arguably receding. Strategy making around  African growth opportunities involves positioning oneself at key  nodes; executing such strategies then involves thinking in less  conventional ways, both below the country level (African opportunity  as turning on various key cities) and beyond the country level  (African opportunity framed in terms of regions and other potential
groupings).

Partnerships

Relationships matter: perhaps more than in any other continent — fostering good, proper relations with all levels of government will continue to be vital to realizing strategic aims. Similarly, we believe that strong local partnerships are critical to success. There is much the scope for cooperative partnerships harnessing different players’ strengths.

People

No strategy is self-executing: sustainable success in Africa will increasingly turn on identifying, nurturing and retaining talented and committed local staff. Meanwhile, for firms focused on reaching Africa’s many underserved customers, effective strategy execution is people focused in another sense: not allowing top-down approaches (informing new consumers of their options) to obscure bottom-up
receptiveness (being responsive to the needs and wants of Africa’s consumers.

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