Although the Nigerian IT infrastructure market is in its infancy, key sectors such as the financial, telecommunications, and oil and gas industries have begun outsourcing elements of their IT functions to third parties. Technological developments, government promotion of ICT and Nigeria’s exposure to the global stage have provided additional growth stimulus.
New analysis from Frost & Sullivan finds that the Nigerian IT infrastructure outsourcing market earned revenues of $58-million in 2007 and estimates this to reach $330-million in 2014.
“The unreliable power supply in Nigeria is promoting the growth of outsourced services such as disaster recovery and dedicated hosting,” notes Frost & Sullivan ICT analyst Mpho Moyo. “This is because companies need to have contingency measures in place to ensure business continuity during power failures.”
Some business requirements may demand 24-hour access to networks or e-mail. Therefore, frequent power outages can be extremely disruptive. IT outsourcing services such as disaster recovery provide backup systems for companies to ensure business continuity.
However, the growth of IT outsourcing services is constrained by the limited number of companies that offer these services. The lack of aggressive marketing by IT outsourcing providers poses a further challenge to market expansion.
“Existing market participants need to take advantage of the growing awareness of the benefits of outsourcing in key sectors,” advises Moyo. “This will ensure that companies have a head start as competition intensifies and the Nigerian IT market develops.”
Experience and accreditation will be important, as Nigerian companies are highly brand-conscious. It is also important for market participants to build strong customer relationships through the provision of consulting services to boost awareness of their IT outsourcing services.
“IT outsourcing service providers need to be able to anticipate customer requirements and design appropriate solutions,” comments Moyo. “They need to engage in a close consultative process with their clients to guarantee success.”