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Processes, Technology and Skills:
The Experience of a CFO in Africa
by Nelly Akoth, Chief Financial Officer, IBM Sub-Saharan Africa
Every day, we balance risk and opportunity, making calculated risks where appropriate whilst leveraging the full extent of the IBM community and group-wide skills base.
In March 2010, we undertook a survey of 1,900 CFOs in 81 countries. The survey revealed how the CFO’s role is changing, with an increasing focus on efficient processes, such as global integration, and a greater ability to provide insights into the business. For example, if you have effective processes and transparency of data, the business can be analysed in more detail, contributing to better business decisions. This has been an important factor for success based on my experience as IBM’s CFO in sub-Saharan Africa.
Organisation and segmentation
Headquartered in New York, IBM was founded in one hundred years ago in 1911, and now has operations in 170 countries globally, encompassing research & development; financing; services; storage and semiconductors, and software. The company supports the full range of the company’s activities in southern Africa, with the exception of research & development which is centralised in the United States. The company has divided its distribution into two key segments: major markets, comprising developed markets in North America and Europe; and growth markets, including Asia, Latin America and Africa. This segment is headquartered in Shanghai, PRC.
Within this segment, Africa and Middle East has been identified as a core region, with considerable expansion in the region over recent years. For example, in 2000, the company had 10 branch offices located in South Africa, Tunisia, Morocco and the Middle East. By 2010, this had extended to 23 branches, across the African continent and the Middle East. Servicing the fast-growing needs of 20% of the world’s population, with an anticipated increase in IT spend each year, Africa and the Middle East represents a key growth market for IBM, with the aim of opening 40 branch offices by 2015.
Partnering for success
For our multinational clients, we see Africa as the next major target region, so we are positioning ourselves to support both international companies investing into Africa, and domestic companies that are expanding their activities. Given IBM’s combination of a global presence and local expertise, we are sought as a business partner by firms of all sizes who share our international culture and stakeholder expectations, whilst leveraging our appreciation of local culture and business practices. International and domestic companies working in Africa have very different needs to their counterparts in mature markets. Not only are they seeking innovative technology to meet their ongoing business needs, but they also need to tap into skills, local capacity, networks and bandwidth. Despite the cultural, language and regulatory differences across countries, companies in all industries are seeking to establish some commonality across countries in terms of infrastructure, distribution and service delivery networks and access to skills.
Forming partnerships with multinational and domestic companies to achieve these objectives is a key element of IBM’s strategy in Africa and the Middle East. To achieve this, it is essential to demonstrate excellence in our own infrastructure, which our clients can then leverage. For example, we have established a ground-up approach to the development of our operations in each country, with the right skills and local insights, processes and customer focus. We recognise that building infrastructure per country is not efficient, and in today’s globally integrated enterprise, we adopt common tools and systems wherever possible. For example, we have centralised our accounting operations in shared service centres in Germany and Malaysia. Consequently, rather than building separate capabilities, we are leveraging existing capacity, therefore freeing up resource for more value-added functions locally.