Twenty six percent of CEOs in Africa believe their companies will be exposed to cyber risk in the next 12 months – and 33% think it will only happen in the next five years. This indicates that among CEOs in Africa, cyber risks are not considered a major risk compared to other factors such as inflation and macroeconomic volatility.
These statistics are based on the responses of 282 CEOs in Africa who participated in PwC’s 26th Annual Global CEO Survey – Africa Business Agenda: Technology Perspective 2023 – which focused on tech-enabled transformation, as well as CEOs’ concerns of disruption and emerging technologies.
As companies seek to increase their technology adoption, digitisation, and automation many are facing the significant risk of being targeted by cybercriminals. The manufacturing and mining sectors are extremely vulnerable in this regard as, despite there being a focus on increasing adoption of smart technologies and Industrial Control Systems (ICS), cybersecurity investments remain relatively low in these sectors. While organisations across all industries have been traditionally attacked (which results in both financial and reputational harm), the financial services sector has proven to have a more mature cybersecurity posture and has made more investments in this area.
“Across sub-Saharan Africa, we have identified a trend that is leaving more organisations open to cyberthreats,” says Hamil Bhoora, PwC Africa cybersecurity competency leader. “We are seeing that the potential for attacks that affect the operations of an organisation due to the adoption of smart technology is now higher. Previously, attacks were focused on corporate or back-office systems which house technologies such as enterprise networks and ERP core business applications, but this is evidently no longer the case.”
Many companies are also dealing with each incident as it happens in isolation instead of having a holistic approach that looks at overall prevention. Bhoora says this means that many organisations do not have a long-term cybersecurity strategic plan.
“Such a strategic plan is necessary to enable the company to withstand the cyber risks and external threats in an offensive manner, allowing the team responsible for dealing with cybersecurity to manage the situation proactively, efficiently and with appropriate risk mitigations in place,” says Dave Ives, PwC SA technology, data and alliance partner.
He says that once an incident takes place, it becomes difficult to reclaim your company’s interface. Therefore, a big step in the right direction is to appoint specialists. “The role of the chief information security officer is important in this regard,” he says.
New technology adoption in Africa
In the financial services sector, 87% of CEOs in Africa say they’re seeing a significant technology disruption to their business models as opposed to 50% globally.
Mark Allderman, PwC Africa technology-enabled transformation lead, says: “Most organisations are investing in improved technology capability – a process that we typically saw starting during the early days of the Covid-19 pandemic in 2020, due to a rapid shift in customer behaviour to digital capabilities. Organisations were forced to start investing in their digital capabilities and build their client-facing assets, and this focus on client engagement solutions started to highlight the importance of data and the shift to the cloud.”
Through its survey, PwC says it noted that organisations are trying to drive growth and are looking more at adopting cloud solutions resulting in massive investments in front-end capabilities. The report also looks at how digitalisation is impacting business productivity and enabling the workforce to become more efficient and productive, resulting in improved overall performance.
“The impact of digitalisation on business performance is significant, and organisations must leverage digital tools to improve productivity,” says Femi Osinubi, PwC West Market Area technology leader. “However, the success of any digital transformation strategy hinges on performance management, employee upskilling, and a people-first approach.”
Opportunities from increased digital adoption
While technology adoption rates in Africa are low, it is worth noting that increased investment in adoption can result in more opportunities for job creation, new skills acquisition, opening up new business areas, and adding more value. CEOs in Africa are also acknowledging the importance of catching up with the rest of the world in the technology race.
“Organisations can derive value from digital transformation, especially if they understand how technology and data can add value to their business, and do this in a sustainable, manageable, and controlled way,” Bhoora says. “Data can change the way CEOs look at business, especially when used appropriately to understand the value their businesses can drive for their customers. This presents an opportunity to upskill workers and bring them at par with the rest of the global workforce.”
What remains key is that managing technology adoption presents an opportunity to mitigate the risk in safeguarding operations against potential cyberattacks, and CEOs will need to show a willingness to prioritise cybersecurity even with the burden of dealing with challenges that they deem to be more urgent.