Companies investing heavily in artificial intelligence (AI),a trend that is increasingly being seen across the continent, could fall into the trap of assuming that new technologies are a plug and play solution to bolster profitability.
By Dr Helena van Wyk, dean of postgraduate studies at the IMM Graduate School.
This isn’t the case, as recent research by McKinsey shows that only 39% of organisations worldwide report enterprise-wide bottom-line impact from AI, despite substantial spending on software, infrastructure and digital transformation.
African enterprises are likely to face the same challenge because measurable returns still depend on whether new technology is aligned to business models, improves customer satisfaction, and aids operational efficiencies.
And therein lies the problem: AI, with all its vast iterations, is too often treated as just another software upgrade instead of using it to rethink how decisions are made, customers are served, and markets are won.
The businesses creating a lasting advantage are doing something different. They are combining technology, customer insight, market understanding, and commercial judgement to create sustainable business value.
Algorithms don’t decide
One of the best examples of a company leveraging technology for commercial advantage is Shoprite’s Checkers Sixty60 platform. By the end of last December, Sixty60 had surpassed 100-million cumulative orders, with sales of R11,9-billion for the second half to December.
While AI-powered demand forecasting and inventory management underpin the platform, technology alone did not create Shoprite’s competitive advantage.
The real innovation was commercial because Shoprite redesigned its operating model around changing customer expectations, transforming stores into local fulfilment hubs, reconfiguring its supply chain, and bringing last-mile delivery largely in-house through a fleet of approximately 10 000 Pingo drivers.
AI helped Shoprite anticipate demand, but algorithms could not redesign the organisation, reshape customer experiences, or make the strategic trade-offs between investment, operations, and long-term growth. That took commercial leadership.
Likewise, Safaricom used AI to rebuild its M-Pesa platform to handle up to 12,000 transactions a second, helping it protect its base from further erosion by Airtel Money, which had been gaining ground.
Then there’s the example of Jubilee Holdings, which used an AI-supported fraud detection system to identify 536 suspicious claims in 2024, While the technology did not create a new insurance product or replace the business model, it strengthened a core commercial function by helping the insurer find losses it might otherwise have had to absorb.
MTN, meanwhile, measures its AI programmes separately rather than lumping them into a single strategy. It runs three: one to cut its own costs, one to sell more to consumers through a recommendation engine already live in six markets and reaching 44 million customers, and one to rent out computing power to other businesses.
Each MTN tool is judged on a different measure, because a cost-saving tool and a revenue engine don’t succeed the same way.
The human edge
However, to ensure commercial capability is reached, marketing must be viewed as a commercial function that helps inform decisions, grow the business and build capability.
For too long, marketing has been treated as a communications function concerned primarily with campaigns, advertising and promotion. But as technology becomes more deeply embedded in business, marketing needs to have a much bigger role in how companies understand and respond to their customers.
Technology can generate huge amounts of customer data, but marketing has to make sense of it and work out what actually matters. It connects what businesses know about their customers with the decisions they make about where to compete, which opportunities to pursue and how technology can deliver value.
We need a generation of business leaders who understand this, and educational institutions are best placed to instil it.
As AI automates more routine execution, postgraduate study becomes less about acquiring another qualification and more about developing the capabilities organisations cannot automate such as systems thinking, commercial reasoning, strategic judgement, and the confidence to make complex decisions in uncertain environments.
Shoprite, Safaricom, Jubilee Holdings, and MTN did not win because they had better algorithms than their competitors. They won because they knew what to do with them.
Africa’s future competitiveness will not be determined by how quickly organisations adopt AI, which will eventually become commonplace, but rather how they use technology strategically to develop a competitive advantage through creating commercial capabilities.