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Firms like Jumia and
Konga are creating
innovative solutions
to overcome the
difficult operating
environment.
January 2017 African Business 31
FEATURE NIGERIA
Nigeria’s
e-commerce
infrastructure
challenge
E-commerce is growing in Nigeria, but
problems with power, transport and
communications are holding it back.
Many Nigerians do not feel secure in making payments
online and prefer to pay cash on delivery, with the
relatively low number of credit and debit cards further
curbing online purchasing.
At a more local level, unlike in more developed
countries, Nigeria lacks comprehensive address re-

cords, which can massively increase the number of
delivery mistakes and delay packages from arriving
at their correct destination.
“The infrastructure challenges facing e-commerce
in Nigeria are substantial – timely and affordable de-
liveries are central to the business model and Nigeria’s
poor transport infrastructure and unreliable power
supplies are key impediments to achieving that,” says
Richard Marshall, senior infrastructure analyst at
BMI Research.
E-commerce companies will not find it easy to over-
come these hurdles, but some difficulties are to be ex-
pected as the industry is creating a path for itself from
scratch. These issues drive up the cost of moving goods
in the country and can make it extremely expensive to
transport everyday items. Creative solutions, like using
drones to make deliveries, can be found throughout
the continent, but there is yet to be a development that
addresses fundamental infrastructure gaps.
Creating a massive e-commerce company in Af-
rica that is able to leverage economies of scale, like
Amazon in the US, will simply not be possible due to
fragmented markets. Problems around cross-border
payments, tariffs and intra-country differences mean
the “Amazon of Africa” may not appear for many years.
Trailblazing a new industry
Leading e-commerce firms are working to create reli-
able and cost-effective transportation networks across
Africa. Nigeria’s biggest online mall, Konga, recently
launched an ambitious warehouse infrastructure pro-
ject called Fulfilled by Konga, aimed at fixing some of
the country’s most persistent infrastructure problems.

As part of the initiative Konga is set to double the size
of its main distribution centre in Lagos to 120,000 sq
ft in 2017 and embark on a country-wide scheme to
build fulfilment centres in Abuja and Port Harcourt.
For Konga, now is the right time to launch this
elaborate project. “Nigeria’s lack of infrastructure has
really been a hindrance to all e-commerce companies
in Nigeria, not just Konga. We are all operating and,
essentially, trailblazing a new industry. We are attempt-
ing to bring millions of consumers who are used to
only shopping offline, online. This is no mean feat,”
says Shola Adekoya, Konga chief executive.
N
igeria’s widespread infrastructure
challenges are well known. Long-
standing issues from inadequate
roads, patchy power supplies and
substandard telecommunication net-
works are limiting the potential of its
burgeoning e-commerce market, with major firms
like Konga and Jumia creating innovative solutions to
overcome this difficult operating environment.
According to management consultancy McKinsey,
e-commerce is expected to become big business in
Africa, with the continent on track to generate yearly
e-commerce sales of $75bn by 2025. Although estimates
for the size of Nigeria’s e-commerce sector vary widely,
the industry is growing rapidly as incomes rise and a
middle-class is slowly being established in the country.
No quick fix
There is no quick fix that will see Nigeria’s most press-

ing e-commerce infrastructure challenges resolved.
Africa’s Premier Infrastructure Summit
Transcorp Hilton, Abuja, Nigeria
27-28 March 2017
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AFC New Concept2b.indd 7 13/12/2016 17:23 AB0117.indb
31 18/12/2016 18:53
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32 African Business January 2017
FEATURE NIGERIA
The Western e-commerce market is structurally
different to those in Africa’s many countries, with Ni-
geria being no exception. “We’ve been fanatical about

identifying challenges and solving them, as there are
no off-the-shelf solutions from Western counterparts
that we can apply to our business here in Africa,” adds
Adekoya. If all goes to plan, thousands of online sellers
in Nigeria who sell their goods through Konga will be
able to use Konga’s new and improved warehouses to
store their merchandise – resulting in a 90% reduction
to merchant order processing times from 40 hours to
three hours.
Prospects are improving
Recent capital injections by multinational companies
in Nigeria’s e-commerce scene are a clear sign that
prospects in this sector are improving, with these
investments also providing vital funds for capital-
intensive activities, like infrastructure development.
Even relatively small advances will reduce costs for
e-commerce businesses, make prices more competitive
for consumers and increase online shopping uptake.
“Receiving, processing and monitoring orders all
require electricity in the e-commerce space, and every
hour spent stuck in traffic means the convenience of
e-commerce is undermined. However, e-commerce
vendors actually have more advantages in this envi-
ronment than regular business, given their ability to
adapt quickly and having less of a ‘fixed’ footprint. For
example, companies are not relying on government
investments to support their delivery networks,” says
Marshall. The Nigerian government still has a key
role to play in improving transportation systems and
remedying logistics issues, even if its financial capacity
to solve these problems is limited. The slowdown in
Nigeria’s economy has reduced the country’s ability to
borrow and raise funds to meaningfully address the

infrastructure deficit. However, the Buhari adminis-
tration can help support infrastructure development
in other ways.
“As we have seen in the port sector – privatisation
and a strong regulatory framework can really unlock
efficiencies in Nigeria’s infrastructure and this is go-
ing to be really important over the next few years. As
such drawing in private finance into rail and road
projects, unblocking infrastructure bottlenecks and
allowing the free movement of goods will be crucial,”
according to Marshall.
Potential is there
The difficulties in creating a successful e-commerce
ecosystem in Nigeria should not be downplayed but
the nascent e-commerce market has the potential
to noticeably improve the lives of Africans up and
down the continent, through lower prices and greater
product choice.
“The business-to-consumer market in sub-Saharan
Africa is growing with the emergence of e-commerce
and the increased demand for consumer goods. The
rise of the SME has also resulted in greater variety
and accessibility to new and competing products.
Goods are now just a click away, and can be sourced
and ordered from anywhere in the world,” says Randy
Buday, regional director for West & Central Africa at
DHL Express.
Finbarr Toesland
A Jumia worker scans a
product.

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Development Southern Africa Vol. 21, No. 2, June 2004
Development Debate and Practice
The future effect of e-business on
treasury and risk management
systems and treasury management
in South Africa
Johan van Rooyen & Willem Reitsma1
’Internet’ and ‘e-business’ are words that have become part of
today’s business world.
Invariably we hear of the effect thereof on the way we used to
do things, due to the shift in
paradigm from command and control to a more open globalised,
multi-polar world. Traditional
ways of doing business are fast becoming redundant, as they are
not able to cater for the needs
of a business in cyberspace. New technology has helped create
new risks and more volatility in
the financial environment due to the ease with which
information is spread. To benefit from the
many new developments that allow more efficient marketing,
improved productivity, lower costs,
better service, and better access to financial resources, a rethink
or re-engineering of the way
we used to do things will be necessary. Doing business in
cyberspace means getting involved in
an environment where all rules have not yet emerged and where
breach of security is a very real
threat. E-business has important implications for South Africa
as an emerging economy, as it
creates the possibility for better access to various financial
resources and eventual increased
economic activity. This will affect all sectors in the economy
and may lead to generally improved

business infrastructure for the country as whole and for
individual businesses, local authorities
and government treasury departments. This is especially
important for South Africa as a
developing country as it may lead to a stronger economy, which,
in turn, will make an important
contribution to more rapid alleviation of poverty and more rapid
reform in the long run.
1. INTRODUCTION
We often pay a great deal of attention to developmental issues
such as land reform,
education and the establishment and financing of major
projects. While no one can
dispute the importance of these issues for the long-term
development of an emerging
economy, we must not lose sight of other important
developmental issues that are in
the ‘background’. These may make important contributions to
the development of the
country over the medium to long term, eventually contributing
to more rapid alleviation
of poverty and a faster pace of reform.
The Internet is one such issue, and has brought about many new
implications for the
business infrastructure of the country and the way we do
business. It is fast becoming
a feature of normal business (Forster, 2000). More importantly,
the way in which the
Internet links many different entities in a vast network creates a
pool of information
that is accessible from any location in the world. The computer
screen is a small

1Respectively, Associate Professor, Department of Business
Management, University of Stellen-
bosch, Stellenbosch, South Africa; and Deputy Group Treasurer,
Nedcor, Sandton, South Africa.
ISSN 0376-835X print/ISSN 1470-3637 online/04/020399-
2004 Development Bank of Southern Africa
DOI: 10.1080/0376835042000219613
400 J van Rooyen & W Reitsma
window into this pool of information, allowing us to interact
with other participants in
cyberspace.
The most important aspect of the Internet is that it facilitates
the flow of business
information, called e-business, between businesses and
consumers, allowing business-
to-business and business-to-consumer interaction.
One of the possibilities created by the Internet is that of trading
online, called
e-commerce. This opens up a new world by allowing trade with
global markets from
any location. The ease with which we change things in this
environment may cause us
to be indifferent to the parties with which we do business – as
long as we are able to
verify their secure identities. Specifically, the Internet allows
greater control over
resources and creates the possibility, especially in the case of
government treasuries, to
intervene more easily in the event of market failures

(Macmillan, 2000:51). There is
greater access to information on the economic activities that
affect the living standards
of the population (Dilnutt, 2002:79).
The modern corporate treasury environment in a company, a
bank, local authority or
government department will also be affected materially by the
Internet. How treasuries
will be affected in the future is important for South Africa. If
we do not keep up with
developments, the cost of catching up (which may be
substantial) will place further
unnecessary strain on the economy and will cause growth
potential to be lost.
E-business is seen as one of the most important enablers of
business, and South African
companies already appear to be about 18 months to two years
behind their counterparts
in the United States (Gordon, 2000:10).
Generally, treasurers in South Africa have not yet fully
exploited the business
advantages of new technologies (Duffield, 2001:18). These must
be seen as opportuni-
ties for the country to establish business practices that will
accelerate business and
development. As a developing country, we need to take note of
important changes in
the global environment and make a concerted effort to ensure
the development of
business practices that are in line with the rest of the world.
Apart from making the
country more accessible for investment purposes, greater
technological advancement
will give investors in developed countries a more positive view

of South Africa. This
will, of course, lower the risk associated with investing in the
country.
The main objectives of this research were threefold:
• To determine the anticipated impact of the Internet and web-
based technologies on
corporate treasuries in South Africa
• To determine the commitment and anticipated timing of
development of e-business
systems by corporate treasuries
• To determine which components of treasury systems will have
to be converted to a
web-based environment
The secondary objectives of the research were:
• To give a theoretical overview of the development and
purpose of information
systems in recent years
• To determine and describe the possible benefits of e-business
for treasury and risk
management and treasury systems in South Africa.
The research was conducted by way of a theoretical survey of
available literature on
information systems and e-business, as well as a survey
questionnaire sent to all
The future effect of e-business on treasury and risk management

systems 401
Figure 1: Decision levels and planning horizons of management
activities
members of the Association of Corporate Treasurers of Southern
Africa (ACTSA) via
email. Although the emphasis in this research is on the business
environment, many of
the issues may, to a greater or lesser extent, apply to treasuries
in other organisations.
For this reason, the survey included only members of ACTSA in
the population.
This study attempts to determine the importance of the Internet
and web-based
environment as a delivery vehicle for e-business from the
(corporate) treasurer’s point
of view. The study is therefore about the Internet and no other
networks. A Likert scale
(of 1 to 10) was used to record the responses from respondents
to questions about
specific treasury systems and treasury management issues.
2. THE HISTORIC DEVELOPMENT, PURPOSE AND
FUNCTION OF IN-
FORMATION SYSTEMS
To develop an appropriate understanding of the effect of the
Internet and of e-business
on corporate treasuries and risk management, we first need to
have a general
understanding of the purpose and functioning of information
systems as such. Corpo-
rate treasury management may briefly be defined as the
safekeeping and disbursement

of negotiable value. Risk management in this context refers to
the management of a
company’s exposure to financial risk, such as interest rate risk,
currency risk, liquidity
risk and capital risk.
When steering a company towards its short-term and long-term
goals, management
needs information about the state of the enterprise. This
management information is
used at different levels in the enterprise (Figure 1) – the
operational level, tactical level
and strategic level (Robson, 1997:85). Information at each of
these levels differs in
terms of accuracy, frequency and completeness:
At the operational level, information is detailed and accurate
and relates only to internal
transactions or accounting. This information is used for short-
term decision making. At
the tactical level, information is more summarised and has to do
with the allocation of
resources. It is mainly internal information (although external
information can be
applied), and is used for short- to medium-term decision
making. At the strategic level
information is summarised across the enterprise. It is composed
of internal and external
information and is used for long-term planning and decision
making.
Computers are especially suited to support management

decision making at the
different levels due to the speed with which usable information
can be extracted from
large databases. Computerised systems summarise, organise and
store information in
such a way that it has value for the management of the
enterprise.
An information system may then be defined as a set of
interrelated components that
collect, retrieve, process, store and distribute information for
the purpose of facilitating
planning, control, coordination, analysis and decision making in
organisations (Laudon
& Laudon, 1998:5).
According to Robson (1997:86), an information system serves
as:
• Instrumentation from which the general state of the enterprise
can be read
• A gauge measuring the performance of the enterprise
• A framework within which corrective action can be taken
The management information system should therefore satisfy
the need for information
at each of the different management levels indicated in Figure
1. Generally, a very
important prerequisite of an information system is that it should
add value to the
enterprise by, for instance, improving its competitive position
and streamlining busi-
ness and decision-making processes. It should improve
productivity, which should lead
to reduced costs and improved earnings.

A number of different issues can be identified as common
problems that inhibit the
success of information systems. In the past, one such issue was
that enterprises simply
climbed on the technological bandwagon, spending money on
computer systems
because everybody was doing it. Very often unjustifiable
amounts of funds were spent
on computerisation, which did not add a commensurate value to
the business.
Currently, there is much more emphasis on getting a return on
investment
in information technology (IT). Fortunately, current technology
can be more
easily justified in terms of the value it adds to the business, as
is discussed in the next
section.
3. NEW DEVELOPMENTS IN INFORMATION
TECHNOLOGY
In the past, systems were mostly fragmented – a major
drawback that limited their
efficiency and usefulness. Computers operated in isolation as
closed systems, using
mostly limited internal company information. In many cases,
information could not be
transferred from one computer to another, mainly due to
compatibility problems; or, if
it could, the process took a great deal of time and effort.
However, this has now changed due the dramatic advances in
computers in recent
years, which has made their application in enterprises far more
efficient. This was
mostly brought about by (Laudon & Laudon, 1998:12):

• The possibility of integrating systems
• Greater processing speeds
• More sophisticated software
• Improved accessibility
• Using computers as part of a larger communications network
and therefore widening
the technological foundations of information systems
The largest manmade network in existence is the Internet,
linking individuals, busi-
systems 403
nesses, governments, and scientific and educational
organisations (Laudon & Laudon,
1998:12). The Internet creates an immensely valuable
information pool from previously
fragmented pockets of information with limited application
value scattered all over the
world. The user in the enterprise can access a vast amount of
external information.
However, the same software used to access the Internet also
allows the user to access
internal enterprise corporate data sources, and is therefore
called the Intranet (Edwards
& Finlay, 1997:361).
It also opens up many new possibilities, such as allowing access
to new markets and
creating electronic business opportunities. This is precisely the
sort of opportunities that

we should be pursuing in this country.
E-business may be defined as the flow of (business) information
across electronic
networks (Allan, 2000:6). For the sake of this study, the
Internet is taken as the network
that gives stakeholders access to information via web- or
browser-based screens. This
means that technology creates an environment into which
information can flow from
two sides – from the user or the person accessing the
information via the Internet, and
from the person or company placing the information on the
Internet. This information
on the Internet is usually called a web page and is developed in
a web language called
Hypertext Mark-up Language (HTML). It allows viewing of
pictures and text only, and
does not allow interaction with users. The next-generation
language for use on the
Internet is called Extensible Mark-up Language (XML), which
allows interaction
between users, and enables complex computer systems to talk to
each other (Els,
2001:57). With this language it is possible to transfer data
between computers and other
devices. XML allows text-based data streams to become
interactive conduits of
information between humans and computers and, more
importantly, among computers
(Els, 2001:57).
Other important developments involving the Internet include
accessing the Internet via
cellphones through wireless application protocol (WAP) or
bluetooth technology, and

interactive television for doing business on the Internet.
When relying on data, it is important to consider certain
characteristics such as security,
cost of access and use, accuracy and timeliness. In this respect,
the Internet is not
without problems. In Table 1, Edwards & Finlay (1997:364)
classify six possible data
sources according to certain characteristics indicating the
likelihood of experiencing
problems with the data. The Internet is not rated highly. This is
due to data sometimes
being unavailable, data access problems occurring (download
formats are incorrect;
data transmission is interrupted due to line problems; input
controls to ensure data
integrity are limited), or major concerns about security.
Although a manager may
bookmark a website as being useful today, the next time he or
she wants to use it, it
has been changed, relocated or removed from the Internet.
It did not take long for businesses to realise the importance of
the Internet from a
business point of view and as a productivity tool used
internally. Marketing, trading
and business (electronic business, or e-business) via the Internet
soon became import-
ant, opening up many new possibilities for marketing, service
delivery and trading.
It is often said that if businesses do not prepare themselves for
e-business, they will be
left out in the cold and may eventually suffer financially and go
under. But what are
the real reasons for doing business on the Internet?

Table 1: Classification of problems with different data sources
Likelihood of problems with:
Internet/
Corporate World WideCharacteristic Commercial
DatabasesPersonal Online
data databases databasesdataof data Webon CD-ROM
Security and NegligibleLow High Negligible Negligible
Negligible
privacy
Volumes Moderate High Moderate High HighLow
Formats Low ModerateHigh LowLow Moderate
Cost Negligible Negligible High HighHigh Low
Integrity High HighModerate LowLow Low
Accuracy Low High Low ModerateModerate High
Timeliness High Low Moderate HighModerate High
Source: Edwards & Finlay (1997:361).
4. IMPLICATIONS OF THE TECHNOLOGICAL CHANGE

FOR THE EN-
TERPRISE OR DEPARTMENT IN GENERAL
All these developments underline a very important issue from a
business or operational
point of view. We are seeing a paradigm shift from the old-style
command-and-control
to an open environment that is oriented towards quality,
innovation and service
(Robson, 1997:273). People are better educated and willing to
contribute to the overall
well-being of the enterprise, department or organisation.
Modern-day information systems allow people to be
empowered, enabling them to
work together in groups – here the Intranet is a prime example
of an empowerment
tool. An information system allows easy, consistently formatted
distribution of infor-
mation, thereby empowering employees and increasing their
productivity. Organisa-
tional structures are constantly becoming flatter (due to work
groups and greater
participation in management) and repetitive tasks are reduced as
they are taken over by
systems.
The implication is that businesses have to look at improving or
re-engineering old
business processes to take advantage of the new, improved
computer systems. Business
process re-engineering implies a radical rethink and redesign of
existing computer
systems (Robson, 1997:272). It is not always possible merely to
adjust old systems, as
the changes needed are usually too drastic, and existing

hardware may be outdated.
5. IMPLICATIONS OF E-BUSINESS FOR TREASURIES
Although e-business is still relatively new, it has many
implications for the future
strategy of businesses and where they want to be in five years’
time. In general,
e-business will probably not change a company’s core business,
but will add important
and valuable new dimensions to an existing and well-established
business model.
Businesses need to remember that the Internet does not bring
about immediate success
and changes in client behaviour. The greatest benefits are to be
seen in terms of
tremendous cost saving (The Economist, 2001:10). Management
therefore needs to
systems 405
Figure 2: Transfer of data between user and operational systems
via the web
environment
evaluate the impact of the web-based environment on its
business and long-term
strategic position.
E-business information is passed on to the environment for
access by users and clients.
Figure 2 illustrates how software may be used to facilitate the
exchange of information

between various operational systems and the web-based browser
environment. In
principle, operational systems do not have to change much to
adjust to the web-based
environment. User screens that were previously used only
internally by treasury staff
should now be redeveloped to run in the web-based (XML)
environment. This
information is then accessible for use on the company’s Intranet
and the Internet.
The information in the web-based environment has to be
interpreted so that it may be
fed through to the operational environment for processing or
storage purposes. Figure
2 highlights the important issue of security. Allowing users and
clients access from any
location outside the enterprise means that unwanted access is
also possible. This is
especially important where clients are allowed to transact online
via the Internet.
Some of the more significant changes that affect treasury
management and treasury
management systems involve important new management issues
that can be identified
from literature available to the enterprise.
Baddeley (2000:16) argues that the impact of e-business will be
material, and will
probably affect data flows and decision making the most. This
statement agrees with
what Thurston (2000) says about the integration of treasury
systems where links are set
up between:

• Any, yet disparate financial information systems within a
corporation
• Corporate subsidiaries and business units
• Corporations, their suppliers, and customers in e-marketplaces
• Banks and all the other players in the supply chain
In addition to integration, the extension of services for access
by the clients across the
globe, as well as spreading costs over a widening market, seems
to be the next logical
addition that the web-based environment offers (The Economist,
2001:10). The inte-
gration and development of systems in a web-based environment
may have the
following important benefits:
• Setting up various new web-based e-finance services means
that clients can be
web-enabled for self-service (Thurston, 2000).
• Web-based e-services lead to a reduction in overheads and
increased productivity as
resources can be reallocated to critical areas.
• E-business gives rise to much more data (even for the
medium-sized business) that
can form the basis of decision information through statistical
analysis (Wood,
2000:13).
• Web-based treasury management and financial services will
lead to a broader and

more global client base for e-finance service providers
(Thurston, 2000).
• There is a better integration of cash flow into back office
operations (Thurston,
2000).
• There is better access to information via the Internet from any
location, which
improves efficiency and shortens the management cycle.
Treasury managers also
need many types of information, such as economic forecasts,
sales and purchase
forecasts, actual cash flow, data on corporate planning, and
market rates for many
types of financial transactions (Forster, 2000). These are
supported in an unpre-
cedented way by the Internet.
• Electronic billing (invoices) and payment will open up new
marketing and communi-
cation channels with clients (Marjanovic, 1999).
• Browsers are more universally used, and development in this
area tends to be
cheaper than dedicated software for treasury management
(Jones, 1999).
• Many web-based development tools make use of object-
oriented programming
techniques that facilitate updating and maintenance of code.
• Due to the lower cost of development and the use of browser-
based technology,
smaller companies can also participate in electronic data
interchange (Jones, 1999).

• As web-based software resides in one location, less
maintenance will be required to
update or change software (Markovic, 1998).
Integration of systems and development in a web-based
environment leads to the
following disadvantages:
• Setting up various links and expanding business through e-
business creates new
problems, such as greater exposure to financial risk. This,
again, emphasises the need
for better risk management (Thurston, 2000). On the other hand,
more efficient
integration of treasury systems means that risk can be better
managed at corporate
level.
• Security becomes an issue, because integrated systems give
greater access to much
more data and thereby increase the operational risk.
• Lack of security tends to prevent some companies from
moving their financial
activities to the Internet (Wood, 1999:26).
• The speed and reliability of web-based delivery channels may
be suspect. The
treasurer is dependent on the service that the Internet service
provider (ISP) can
offer.
It is therefore evident that better integrated, web-based treasury
management systems
may hold many benefits. However, serious disadvantages are

lack of speed and
reliability. Even though all the benefits suggest an environment
that will lead to
significant business progress, few of these benefits will realise
if the Internet delivery
channel does not stay open, or is slow. Furthermore, there is the
question of which
components of the treasury should reside in the web-based
environment.
To understand the extent of changes to treasury systems, the
different components of
treasury systems have to be considered (adapted from Large,
1999:40):
systems 407
Front office (transaction execution)
Market management
• Trading systems
— Dealer support
—Electronic deal-capturing systems
—Automated real-time position-keeping
—Valuation
—Straight-through processing
• Pricing systems
• Market data feeds
Middle office (risk identification)

Middle office administration and management
• Risk, and profit and loss
• Management control
Back office (settlement and administration)
Back office administration
• Cash liquidity management
• Workflow management
• Safe custody
• Accounts and database
6. RESEARCH FINDINGS
As mentioned, questionnaires were sent to the members of
ACTSA. The response rate
was 17,63 per cent, which is lower than the accepted norm of 20
per cent. Of a total
of 278 members, 49 questionnaires were returned, of which
three respondents indicated
that they were no longer involved in the treasury environment
and therefore were not
in a position to complete the questionnaire.
The overall response rate is relatively low because persons
employed in a treasury
environment generally work under pressure and therefore have
difficulty in finding time
for additional tasks, such as completing a research
questionnaire. However, according
to ACTSA, the response rate is much higher than for similar
surveys done in the past.
The better-than-usual response rate may be attributed to the use
of email for despatch-

ing and returning questionnaires.
Note that responses were received mostly from corporate
treasuries and banks and
financial services with a turnover of more than R1 000 million
per annum. This
research may therefore be representative of large companies.
Due to the similarity of
risk management processes in companies of all sizes, it is not
unreasonable to assume
that the findings would apply to smaller companies as well.
The research findings were discussed with a corporate entity
that conducted similar
research independently. This was done to determine whether the
outcome of this
research could be confirmed by the results of other studies. The
discussion indeed
confirmed the overall outcome of this research and no testing
for non-response bias was
therefore carried out. The tables and text that follow reflect the
arithmetic mean of the
scale values obtained from the returned questionnaires.
Table 2: Sectors of the economy in which the respondents are
involved
Frequency
23Financial: Banks and financial services
Financial: Other 8

4Industrial: Consumer
Industrial: Electronics 1
Industrial: Food 1
2Industrial: Retail
Industrial: Service 1
1Industrial: Steel and allied, building and
construction
Industrial: Telecommunications 1
2Insurance: Short-term insurance
Mining resources: Metals and minerals 6
1Mining resources: Mining holdings and
houses
1Non-mining resources: Chemical
2Non-mining resources: Steel
1Non-mining resources: Paper
Parastatals 2
Note: Some respondents indicated that they were involved in
more than one sector.

Consequently, the responses in this table add up to more than
the total number of
responses received.
The responses were from ACTSA members in corporate
treasuries in various sectors
of the economy, as indicated in Table 2.
Respondents indicated that they were involved in some or
several aspects of treasury
management (Table 3). This further underlines the importance
of the Internet and
web-based technology from the point of view of the treasury
decision makers.
The respondents were further grouped according to the level of
responsibility. Most
were at management level (27 respondents), with three directors
and 16 in the category
‘other’.
Respondents were requested to indicate the size of the treasury
operations in terms of
money turnover. Apart from the 38 companies with a turnover
of more than R1 000
million per annum, two had a turnover between R200 million
and R1 000 million p.a.,
and one less than R200 million p.a. Four respondents filled in
‘not applicable’, and one
gave no response.
The next section wished to establish how important respondents
rated the Internet from
a treasury systems and management point of view. The
questions asked were:

• To what extent has the Internet and web-based technology
already influenced
treasury management systems in your company?
systems 409
Table 3: Treasury area of involvement
Frequency
11Administration/accounting
Asset-liability management 1
Corporate finance 1
16Dealing
Marketing 3
Operations 1
9Systems
Treasury/risk management 28
1Research
Other 3
Note: Some respondents indicated that they were in-

volved in more than one sector. Consequently, the
responses in this table add up to more than the total
number of responses received.
• To what extent has the Internet and web-based technology
already influenced
treasury management systems in South Africa?
• Do you think that the Internet and web-based technology will
have a material
influence on treasury management systems in the future?
• Do you think the Internet and web-based treasury systems will
have a material
influence on treasury management in the future? The average
scale values of the
answers were calculated, and are shown graphically in Figure 3.
Table 4 reflects the responses to questions as regards the
benefits that the Internet and
web-based treasury systems may offer. Note the consistently
high values of the
responses.
Figure 3: Importance of the Internet to respondents
Table 4: The effect of the Internet and web-based treasury
systems on treasury
management

Benefits Average value
6,111 Improved system integration
2 Web-enabling of clients (frees current resources) 6,43
5,243 Reduction of overheads
4 Increased productivity and therefore lower operational costs
5,81
5 Web-based systems or e-business produces more data or
management information 6,12
6,426 Better integration of cash flow into back office operations
7 Better access to systems from any location shortens
management cycle 6,96
6,818 Electronic billing and payment systems open up new
markets and communication
channels
6,649 More universal and more user-friendly screens
10 Object-oriented web development tools make updating and
maintenance easier 6,96
6,4411 Lower cost of development; small companies can now
also participate in electronic
data interchange
6,9312 Web-based software easier to maintain as it resides in
one location

In addition to the benefits listed in the questionnaire, individual
respondents listed and
rated the following benefits (Table 5).
Table 5: Additional benefits listed by respondents
Benefits Value
81 Greatly reduced cost per transaction when utilising Internet-
based systems to
remit payments to foreign suppliers
92 Improves interaction with the public and on a business-to-
business basis
3 Lowers costs of setting up wide area networks Not rated
4 Transparency 8
65 Speed (not bandwidth) of use
6 Web-based training and development of people 7
77 Better able to trade at finer rates
108 Will overcome previously felt geographical and physical
boundaries
9 Sharper and more effective focus on money, cash flow, key
corporate values 10
and policies
10 Shift away from accruals to immediate payment for goods

and services will 10
promote simpler accounting principles
711 Lower capital costs
512 Lower maintenance costs
713 Quicker implementation
914 Promotes global cash management/funding activities
15 Automated trading exchanges and platforms in unregulated
markets 10
16 Ease of integration into the globalisation of resources and
procedures 10
systems 411
Table 6: Components of the corporate system to be converted to
a web-based
technology environment
System components Yes – will be/has been converted (%)
1 Market data links (for rate feeds)
68,9• Reuters
• Bloomberg 37,8
55,6• I-Net Bridge Telerate
2 Trading systems 77,8

80,03 Deal-capturing systems
4 Pricing systems 73,3
5 Exposure limits
• Available to clients 55,6
51,1• Dealer limits
6 Risk tools 57,8
60,07 Middle office, back office management information
8 Availability of treasury management information
66,7• Movement reports
• Cash management information 57,8
48,9• Portfolio risk information
• Simulation/modelling information 60,0
62,2• Client risk exposure
• Exception reports 57,8
55,6• Safe custody
62,2• Accounting/portfolio information
Respondents were requested to indicate which components in
their companies should
be converted, or had already been converted to the web
environment. The results
obtained are shown in Table 6. Note the high percentages in the
table for specific
components to be run in a web browser or to be accessible on
the Internet/Intranet.

(This does not mean that back office systems will run in the
web environment or should
be converted to do so.)
Respondents were requested to indicate how committed their
companies were to
converting to, or developing web-based treasury systems. On a
scale of 1 to 10, an
average value of 6,14 was obtained for all respondents. They
also had to estimate how
long this conversion or development process would take. The
average period of 2,78
years indicated is surprisingly long, especially in view of the
opportunities that the
Internet may offer. The length of time required may possibly
underline the complexity
of treasury management, and the fact that these systems are not
easily developed and
implemented. It may also indicate reluctance on the part of
corporates to move too fast
on this issue, or may point to a wait-and-see attitude. The
question of security and
bandwidth may also play an important role here.
Respondents (who generally entered low-scale values in
previous questions in the
questionnaire) were requested to rate, on a scale of 1 to 10, why
the web-based
Table 7: Reasons why Internet or web-based treasury systems
might not be used

Average valueReason
6,241 Security risk
5,192 Uncertain reliability (allowing easy and constant access at
any time of the day or
night from any location)
5,113 General suitability of the Internet and web-based
technology for use in the treasury
environment
Table 8: Other reasons why the Internet or web-based treasury
systems might not be used
ValueOther reasons
91 Bandwidth
2 High cost of development 9
103 Problems with agreeing on one system (such as the Internet)
4 High cost of existing systems 9
5 Market acceptability 8
76 Personalised needs: company and clients
7 Acceptance by users Not rated
108 Sophistication of clients
9 Clients’ need for immediate information 10

environment might not be used by corporate treasuries. A high
value indicates that the
specific issue is an important reason why the web-based
environment might possibly
not be used (Table 7).
Individual respondents also added further reasons to the above
(Table 8).
7. SUMMARY AND CONCLUSIONS
Although this research generally focused on treasury
management, the importance of
this issue must not be underestimated for South Africa as a
developing country. The
more we take advantage of opportunities to develop our
business, political and social
infrastructures, the more we will be seen by the international
community as a country
in which to invest. Embracing technological change offers the
potential for high growth
and high returns due to progressive changes taking place.
The following are the main conclusions of this study:
South African companies generally see the web-based
environment and its advantages
in a positive light, and recognise its possible benefits for the
business environment of
South Africa as a developing country. There is consensus that
the Internet will have a
material influence in the future, but that the benefits, for South
Africa, will start
realising only in the next two to three years. Although
companies realise the import-

ance of the Internet, they seem to adopt a wait-and-see
approach. Many benefits of
treasury management systems in the web environment were
identified. The extent to
systems 413
which these benefits will be realised for individual companies
or institutions will
probably depend on the nature of the business or operations.
However, respondents
generally agreed with the benefits listed. Remote access to
systems, extension of
systems to clients, and lower development and maintenance
costs are highly rated
benefits. Various reasons were given why companies might not
decide to move their
treasury systems to the web-based environment, namely
uncertain security, limited
bandwidth, lack of agreement on one system among participants
in the marketplace,
cost of systems, and specialised client needs.
Although issues such as bandwidth and security are important, a
significant degree of
functionality has been established on the Internet, which may
already lead to greater
efficiency in treasury management now. However, the matter of
bandwidth as such is
outside the scope of this research.
Existing treasury systems may not necessarily have to be
redeveloped. They merely

need to be extended to provide additional functionality and
accessibility through
web-based, object-oriented program code and software that
allow switching of infor-
mation between the operational systems and the web-based user
interface. The same
functionality that can be provided internally to treasury users
via the Intranet, can also
be provided to clients.
Although it may be argued that treasury management systems
need a totally reliable
network, this argument applies equally to all companies and
institutions running
corporate treasuries and allowing remote access through
networks. This means that the
ISPs should be capable of providing totally reliable services,
otherwise (corporate)
treasuries need to set up their own ISPs.
Further research may be conducted to gather more information
about the technical
issues or needs of the industry as regards web-based treasury
systems and treasury
management. This should specifically deal with aspects such as
the following:
• Bandwidth, and how it affects the current and future business
situation in South
Africa – this is especially important and should receive serious
consideration
• Issues concerning security of remote access
• The specific web functionality that treasury managers in South
Africa require, i.e.

what web software should support from a management point of
view
• Software development issues (in-house development or
acquisition from external
suppliers)
• Cost of software acquisition from local and foreign suppliers.
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Mbarika et al./Neglected Continent of IS research
Journal of the Association for Information Systems,
Vol. 6, No.5, pp.130-170/May 2005 130
The Neglected Continent of IS Research:
A Research Agenda for Sub-Saharan Africa∗
Victor W. A. Mbarika
College of Business
Southern University and A&M College
[email protected]
Chitu Okoli
John Molson School of Business
Concordia University
[email protected]
Terry Anthony Byrd
College of Business
Auburn University
[email protected]
Pratim Datta
Department of Information Systems

Washington State University
[email protected]
Abstract
Research with a focus on Sub-Saharan Africa (SSA), a major
region within the world’s second
largest continent, is almost non-existent in mainstream
information systems research. Although
infrastructures for information and communication technology
(ICT) are well established in the
more developed and industrialized parts of the world, the same
is not true for developing
countries. Research on developing countries has been rare in
mainstream IS and, even where
existent, has often overlooked the particular situation of SSA,
home to 33 of the world’s 48
least-developed countries. Ironically, it is such parts of the
world that can stand to gain the most
from the promise of ICT with applications that would help the
socioeconomic development of
this region. In this study, we present the need for focused
research on the ICT development and
application for SSA. The information systems research
community has a unique and valuable
perspective to bring to the challenges this region faces in
developing its ICT infrastructure,
∗ Detmar Straub was the accepting senior editor for this paper.
IS RESEARCH PERSPECTIVES ARTICLE

Journal of the Association for Information
Systems, Vol. 6, No.5, pp.130-170/May 2005 131
hence extending research and practice in ICT diffusion and
policy. We present here a research
agenda for studying the adoption, development, and application
of ICT in SSA. In particular,
teledensity, telemedicine, online education, and e-commerce
present important areas for
research, with implications for research, practice, and teaching.
Keywords: Sub-Saharan Africa, telecommunications
infrastructure, information and
communication technologies (ICT), ICT development, ICT
application, telemedicine, online
education, electronic commerce, information systems research,
ICT diffusion, socioeconomic
development
Introduction
In his letter of introduction as president of the Association for
Information Systems (AIS) for
2002-2003, Philip Ein-Dor commented:
AIS did not cause the digital divide, but it is certainly very
much a reflection of it.
A few numbers may highlight this. Region 2 comprises Europe,
Africa and the
Middle East. There are 287 members with Region 2 e-mail
addresses. Of these,
only 17 are in the Middle East and 19 in all of Africa. If we

subtract 15 members
in South Africa, there are just 4 members in all the rest of
Africa! This compares
with 31 members in Germany and 72 in the UK alone. (2002)
Ein-Dor’s comments strikingly highlight the under-
representation of African researchers in the
world’s premier academy of information systems (IS)
researchers. It is somewhat surprising that
this region of 633 million people—10% of the world’s
population—is so neglected in the
important contemporary domain of IS research. Sub-Saharan
Africa (SSA), a major part of the
world’s second largest continent, is the region with the lowest
level of technological
development in the world. The importance of low ICT
development in SSA, also the
economically poorest region in the world, is that considerable
research has shown that ICT is a
key for economic growth and development in virtually all
countries in the present information
age (Dutta, 1997; Dutta, 2001; Gilbert, 1996; Jensen, 1999;
Mbarika et al., 2001; Meso and
Duncan, 2000; Odedra et al., 1993; Odedra-Straub, 1993;
Petrazzini and Kibati, 1999; Press,
1999; Raman and Yap, 1996; Salem, 1986; Splettstoesser and
Towry-Coker, 1999; Wolcott et
al., 2001).
With the development of complex and modern ICT, both
developed and underdeveloped
countries are exploring ways to enjoy the many benefits of these
technologies (Dutta, 2001;
2002; Goodman, 1994; Mbarika, Byrd, and Raymond, 2002b;
Straub, Loch, and Hill, 2001).

Sadly, however, a digital divide between developed countries
and underdeveloped countries
looms large. The digital divide is defined as the “differential
capabilities of entire social [or
regional] groups to access and utilize electronic forms of
knowledge” (Straub, 2003 p. W477),
segregating the “haves” from the “have-nots” in the information
society. While much discussion
on the digital divide has focused on that which occurs among
different social groups within a
single country (Hoffman and Novak, 1998), we note here the
international digital divide between
different countries (Straub, 2003). This digital divide is
abundantly clear when comparing ICT in
SSA with the countries of the West like the United States or the
United Kingdom. For example,
while the US and the UK have been enjoying Internet
connectivity for more than two decades,
Eritrea had its first Internet connection only in 2000. Similarly,
and closely related, while the US
boasts more than 60 telephone lines per 100 people, many SSA
countries still share less than 1
Vol. 6, No.5, pp.130-170/May 2005 132
line per 100 people. The use of ICT in SSA also lags
considerably even when compared to
other underdeveloped regions, such as those in Central America.
The region we call SSA in this paper consists of 49 countries

that, along with their 633 million
people, have some of the fastest growing populations in the
world. These countries are
demarcated by their geographical location. A map is shown in
Appendix A. SSA begins
immediately south of the Sahara Desert below the Tropic of
Cancer (latitude 23½o N) through
the Equator down to 35o South, just north of South Africa.
North Africa is not included in this
region, as it resembles the Middle East much more than the rest
of Africa. South Africa is not
included in this present study because of its confounding
socioeconomic situation, where
Western European influences are much stronger than in the rest
of the region. The table in
Appendix B shows the disparity when comparing North and
South African countries to SSA
countries.
The countries of SSA are typically low-income nations suffering
from long-term constraints
against growth. These constraints include low levels of human
resource development and
severe structural social, political, and economic weaknesses
(Austin, 1990). However, SSA has
a scarred history, exploited and ravaged both from within and
beyond. After a long and grim
colonial period, the region plummeted into subsequent crises in
governance, economy, and
healthcare. More than 8 million people in SSA have been
victims of civil wars and tribal feuds
over the past few decades. More than 40% of the population is
illiterate, with reported gross
domestic products amounting to less than $1 a day for more
than 50% of citizens. HIV infection
has grown to epidemic proportions, with 70% of the world’s

HIV cases occurring in SSA. From a
technological standpoint, SSA represents the least developed
region of the world in terms of
telecommunications infrastructure development (Mbarika, 2001;
Odedra et al., 1993). As a
result of these problems, it is home to 33 of the 48 least-
developed countries (LDCs) of the
world (OHRLLS, 2003). These dismal statistics are but a sample
of the many afflictions plaguing
the region and necessitating immediate intervention. In this
paper, we are not addressing the
reasons why SSA countries are in their present condition, but
rather we focus on how the IS
research community can contribute to alleviating some of the
ills of SSA.
Most of the theoretical frameworks that have been reported in
the top IS journals like MIS
Quarterly (MISQ), Information Systems Research (ISR), Journal
of MIS (JMIS), and Journal of
the AIS (JAIS) are based on ICT research that has been
completed in Western countries like
the United States and England. SSA is highly tribally
segregated, offering a rich variety of
languages, social mores, and cultures. The cultural, political,
social, and economic uniqueness
that SSA presents could provide researchers with fertile ground
for fresh extensions of existing
theoretical paradigms and sometimes entirely new and different
research frameworks. Because
of their uniqueness, the cultural, political, social, and economic
traits are likely to moderate the
relationship between ICT investments and performance
outcomes differently from in Western
countries, or even in the more “developed” developing
countries. Using these traits as

moderators in research projects on ICT in SSA will almost
assuredly force changes in the
underlying theoretical frameworks on which these projects are
based. Such research projects
could provide researchers and practitioners a rich and insightful
template of fundamental IS
applications and offer potential tentative generalizations for
developing nations. This paper
attempts to set a research agenda for IS researchers who are
interested in doing research in
SSA. We review several ICT research areas through the lenses
of the cultural, political, social,
and economic traits of SSA countries. Specifically, we develop
and examine an ICT ecosystem
for SSA and explore the research implications using these traits.
In many ways, at least
economically, Sub-Saharan Africa offers the polar opposite end
of the spectrum in terms of
diversity of research setting, thus offering an opportunity to test
the limits of generalizability of
many theories.
Development researchers have hailed new ICT as the “great
equalizer”, revolutionary
technological tools that can enable efficient transfer of
information on a global scale
(Brynjolfsson and Smith, 2000; Travica, 2002). This global
information can be used for

international trade (UNECA, 1999c), online digital libraries
(Rosenberg, 1998; Rosenberg,
1999), online education (Light, 1999), telemedicine (Mbarika,
2003), e-government (Becker,
2001), and many other applications that can potentially solve
critical problems in the developing
world. These applications could help push SSA up the economic
ladder and possibly make it a
critical trade partner in the international community. Because of
the great schism between ICT
infrastructures in SSA and many other countries of the world, it
is critical that modern
technological infrastructures be initiated, developed, diffused,
and routinized in SSA. Otherwise,
SSA may be permanently excluded from the technological
community and, thus, the economic
community in the world markets.
Although the SSA region holds much promise because of its
natural and other resources,
solutions must be found to its technological problems in order
for its economic destiny to
change. IS researchers can be an instrumental component in
helping to solve problems
associated with the implementation of new ICT infrastructures.
Developed countries take for
granted sources of widespread public information such as
television broadcasting, telephone
services, educational institutions, and public libraries. In
developing countries, however, such
infrastructure is seriously deficient, and this cripples citizens’
ability to gather information and
coordinate with each other to solve their problems (Odedra-
Straub, 1993). Through efficient
information dissemination, ICT infrastructures promise a
quantum-leap boost in internal

communications in developing countries. Previous research
argues specifically that such
infrastructures are fundamental to the socioeconomic
development of developing countries
within the SSA region (Chifwepa, 1996; Mbarika, 2001; Odedra
et al., 1993; Odedra-Straub,
1993). The Vice President of Finance and Private Sector
Development of the World Bank noted,
“Low-cost telecommunications and information systems are
simply not luxuries for developing
countries in today’s world. On the contrary, they are strategic
factors of production central to the
development process and to poverty reduction” (Rischard,
1996).
Based on the positive impact of ICT in the most
technologically-advanced nations, leaders from
both developed and developing nations have increasingly
realized that ICT infrastructure
development is vital for the socioeconomic well-being of
developing nations. In a plea at the
World Summit on the Information Society, the United Nations
Secretary General Kofi Annan
(2003) called for the U.S. information community to involve its
innovative dynamism to bridge
the digital divide that threatens to marginalize development
prospects. The UN has approved $6
million for the “Internet Initiative” in Africa and a further $11.5
million for ICT projects under the
banner of “Harnessing Information Technology for
Development.” The Africa Growth and
Opportunity Act is a step in that direction, triggering the
creation of 190,000 jobs and
investments of $340 million within three years of its inception.
Foreign direct investments have
jumped from less than $1 billion in 1995 to $7.2 billion in 2003

(USAID, 2003). Referring to SSA
as the “last great emerging market of the world,” President
George W. Bush, in his July 2003
trip to Africa, committed to a “trade not aid” policy. In a
resolution to help developing countries
take full advantage of the Internet, the G-8 members (Britain,
Canada, France, Germany, Italy,
Japan, Russia, and the United States) declared: “Countries that
succeed in harnessing
information (and communications) technology potential can
look forward to leapfrogging
conventional obstacles of infrastructure development,” and,
“Everyone should be able to enjoy
access to information and communications networks” (CNN,
2000). Such access could be an
Vol. 6, No.5, pp.130-170/May 2005 134
impetus to bridge the digital divide between the developed
countries and developing countries
such as those in SSA. In 1987, Felix Houphouet Boigny, the
former President of Ivory Coast,
warned, “since Africa missed the Industrial Revolution, we
can’t afford to stand aside and let the
communication revolution go by too” (Rahedi, 2002 p. 19).
The marked disparity between SSA, an underdog, and other
world regions adds credibility and
relevance to our research focus in tying together the region’s
ICT infrastructure to its

consequent socioeconomic betterment. We, as a community of
IS researchers, are arguing for
these underdogs, contending that access to information is a
prerequisite to sustainable
development. Take for example IDRC’s (International
Development Research Centre) ICT
project called Acacia, and its impact on Senegal’s villages
(IDRC, 2002a). Acacia introduced the
Internet to rural villages in Senegal to improve information
accessibility. The results have been
dramatic. Local elected representatives can access the latest
land reform legislations and
inform themselves on natural resource management. Local
health officials are looking up
information for diagnostic assistance and preventative medicine,
as well as using ICT to
maintain medical inventories. Peasants are learning about
weather forecasts, land reform
initiatives, and funding options. The informating of rural
Senegal provides a glimpse of how the
power of information can be harnessed for considerable impact
on the environment and for
social spillover benefits. Because of this relationship between
ICT and its socioeconomic
environments, we use the “information ecosystem” metaphor to
bring ICT to the forefront and to
visualize their intrinsic environmental benefits as a single
encompassing system.
Even the private sector has moved in. Sun Microsystems, AOL
Time-Warner, and HP have
pledged $10 million toward using information to better the
quality of life in SSA
(Kowalczykowski, 2002). At the center of it all is the belief that
only access to information can
allow SSA to leap-frog its way to become a participant, rather

than an onlooker, in the
information society. From the World Bank to HP, there is a
unanimous recognition that
information systems can lead to improved governance, better
management of human capital
(including education, healthcare), a more congenial institutional
climate for investment, and
further debt reduction and development assistance. As Odedra et
al. (1993) note, the need for
an information ecosystem for SSA is not presumptuous, but
rather a precursor that can usher in
a new era of growth and opportunity. Maintaining that SSA
needs to assess its technological
needs before taking a leap of faith by looking toward the
western world, Odedra et al. (Odedra
et al.) contend that a prudent choice of technology, along with a
focused infrastructure
development, is the key to overcoming the odds that have
plagued SSA over decades. In this
vein, proposing an ICT ecosystem for SSA seems a logical and
actionable approach to uplift the
region from being a technological desert.
Using the contexts of the countries of SSA and their distinctive
cultural, social, political, and
economic characteristics in ICT research may force a change in
the research paradigms that
have been reported in our top IS journals. A shift in many of
these paradigms themselves could
serve as a compelling incentive for researchers, allowing them
to uncover, revisit, and
operationalize constructs anew. At the very least, we may
discover a clear distinction between
the development, use, and implementation of ICT in the least
developed countries, under-
developed countries, and more developed Western nations.

SSA Research in Key Information Systems Journals
We searched a number of key information systems journals for
publications concerning Sub-
Saharan Africa. This is not by any means meant to be a
comprehensive survey of IS research
on SSA (for such reviews, see Okoli (2003), Okoli and Mbarika
(2003), and Mbarika (Mbarika,
2001)), but by selecting a few important journals, we can get a
rough idea of the highest caliber
of information systems research that has focused on this part of
the world to date. Based on the
Lowry et al. (2004) extremely comprehensive ranking of IS
journals, we selected the three top-
ranked journals dedicated to research in IS: MISQ, ISR, and
JMIS. These are widely
acknowledged as the premier journals in information systems,
representing the highest quality
of research that is carried out in this field. Vessey, Ramesh, and
Glass (2002) empirically
analyzed the nature of publications in five leading IS and
decision sciences journals from 1995
to 1999. In this representative period, the three leading IS
journals mostly published research at
the organizational and individual levels of analysis. ISR and
JMIS had nine and four articles,

respectively, at the societal level of analysis, which would be
very applicable to much of the
research we propose in this agenda for SSA; MISQ, being
dedicated to organizational research
(Zmud, 1995), avowedly does not publish such articles. All
three journals published a few
articles on societal concepts (ISR, three; JMIS, three; and
MISQ, two). Nearly half the articles in
the three journals adopted a positivist research approach, albeit
they all published several
interpretive studies, as well as other research approaches, such
as those that focused more on
description or model formulation.
We also searched the Journal of the AIS (JAIS)—the flagship
journal of the Association for
Information Systems—and the Communications of the AIS
(CAIS)—the Association’s general-
interest journal. These two journals have an explicit goal to be
innovative and creative—
including embracing unconventional as well as general themes
that encompass the full breadth
of the information systems discipline. Out of 1,833 research
articles published in these five
journals, as of April 2004, we found only one article (in JMIS)
related to SSA (de Vreede, Jones,
and Mgaya, 1999). This sole top-journal publication used a
grounded theory approach to
develop a cultural model based on the Technology Acceptance
Model of how group support
systems are accepted in East and Central Africa. In a field study
of 11 projects in three
countries, de Vreede et al. (1999) found that, while the high
power distance of East African
culture did not stop managers from using groupware, they did
neglect some of the democratic

decision-making features of the software in order to retain their
authority when they deemed it
necessary.
Table 1 presents a listing of SSA-related research publications
in key information systems
journals, including three other journals that were developed
specifically to cover global IS
research: Journal of Global Information Management (JGIM),
the Journal of Global Information
Technology Management (JGITM), and the Electronic Journal
on Information Systems in
Developing Countries (EJISDC). These three additional
journals already have a history of
publishing such research, as Table 1 illustrates. The articles that
these journals accept span all
levels of analysis, methodological approaches, and topic areas
(within their stated scopes of
global IS or IS in developing countries).
There may be several reasons to explain this deficiency in these
five leading journals. Perhaps
many of the studies that focused on the SSA region did not
carry the level of rigor and relevance
required. Perhaps scholars in the developed world find it
difficult to venture into research based
on a part of the world they neither have visited nor intend to
visit. Moreover, scholars that reside
within the SSA region do not seem to be active in mainstream
information systems arenas due
to several reasons such as lack of financial incentives to do
research. Relative to the
distinctively different “research” and “teaching” universities in
North America, most universities
within the SSA region would be considered to be “teaching”
institutions with very little pressure

to publish in order to “survive” within their higher education
sector. Therefore, very few scholars,
even within the SSA region, are involved in research that
focuses on this “forgotten” region of
the world. From the perspective of the top IS journals, research
with the society as the level of
Vol. 6, No.5, pp.130-170/May 2005 136
analysis might not be so readily accepted as a meaningful
contribution. Moreover, while they all
do publish a few papers with societal topics, these do not seem
to be core.
Journal MISQ ISR JMIS JAIS CAIS EJISDC JGIM JGITM
First
Issue 1977 1990 1984 2000 1999 2000 1993 1998
# articles
(Apr.
2004)
624 283 622 48 306 98 140 81
Sub-
Saharan
(except
South
Africa)

None None (de
Vreede
et al.,
1999)
None None (Braa et al.,
2001; Idowu, Alu,
and Adagunodo,
2002; Mbarika,
2002; Mbarika et
al., 2003; Mbile,
DeGrande, and
Okon, 2003;
Soriyan et al.,
2001;
Splettstoesser
and Kimaro,
2000; Yavwa and
Kritzinger, 2001)
(Odedra-Straub,
1993)
(Mbarika et al.,
2002b)
(Hasan and Ditsa,
1999; Wresch, 2003)
(Splettstoesser
and Towry-Coker,
1999)
(Mursu et al.,
1999)
(Darley, 2001)
(Okunoye and

Karsten, 2002)
(Brown and
Licker, 2003;
Mbarika et al.,
2002a; Okoli and
Mbarika, 2003)
South
African
(Miller and
Doyle, 1987;
Money, Tromp,
and Wegner,
1988)
(Brown, 2002;
Cloete, Courtney,
and Fintz, 2002;
Fleming, 2002;
Licker, 2001;
Mbarika et al.,
2003)
(Karlsbjerg,
Damsgaard, and
Scheepers, 2003)
(Erwin and
Blewett, 1999)
North
African
(Nidumolu et
al., 1996)

(Chandani and
Breton, 2001;
Mbarika et al.,
2003)
(Hill et al., 1998;
Kamel, 1995; Khalil
and Elkordy, 1997;
Rose and Straub,
1998; Straub et al.,
2002; Straub et al.,
2001)
Total
African 3 None 1 None None 13 11 8
Journals
MISQ MIS Quarterly
ISR Information Systems Research
JMIS Journal of Management Information Systems
CAIS Communications of the AIS
JAIS Journal of the AIS
EJISDC Electronic Journal on Information Systems in
Developing Countries
JGIM Journal of Global Information Management
JGITM Journal of Global Information Technology Management
Having explained the need for a research program such as we
call for in this paper, the
following section presents a framework for an information
ecosystem in SSA that can serve as a
guide for research on ICT in this region. Subsequent sections

discuss different aspects of this
Table 1. Africa-Related Research Publications In Selected IS
Journals
Key to Table 1
infrastructure in detail, highlighting their potential for research
in ICT issues in SSA. In particular,
we examine teledensity as a means of adopting ICT; ICT
development; and telemedicine, online
education, and e-commerce as socioeconomic applications of
the information ecosystem. After
these overviews we list suggested research questions that would
give important new insight into
these areas, and then we follow with implications.
An Information Ecosystem Framework for Sub-Saharan Africa
Worldwide ICT investments, currently billed at about $1.2
trillion and expected to rise by 8-10%
in the next few years (IDRC, 2002b) are overtaking global
economic growth. This is evidence
that technological investments are assuming a leading role in
the development of global
economies. However, harnessing the power of such investments
is dependent upon a multitude
of interrelated and interacting factors that work together to

define the ICT ecosystem. The
factors include precursors, mediators, moderators, and outcomes
fueled by ICT investments.
Based on several models for national ICT (Meso and Duncan,
2000; Wolcott et al., 2001), we
present here an ICT ecosystem model for Sub-Saharan Africa
that can serve as a high-level
research framework (Figure 1).
As mentioned earlier, the ICT ecosystem for SSA is examined
as a community of pertinent and
cohesive factors within the SSA environment, functioning as a
unit. The framework of the ICT
ecosystem is developed as a complex relationship including
infrastructure investments,
infrastructure development, and infrastructure applications that
lead to social and economic
outcomes, which further affect both infrastructure investments
and infrastructure development.
In addition to the recursive relationship between the outcomes
and infrastructure investments
and infrastructure development, the two outcome dimensions
(social and economic) are
mutually related.
Figure 1. An ICT Ecosystem for Sub-Saharan Africa
ICT Infrastructure

Investments
Infrastructure
Adoption
Economic National ICT Social
Outcomes Infrastructure Development Outcomes
Infrastructure
Diffusion
ICT Infrastructure
Applications
Vol. 6, No.5, pp.130-170/May 2005 138
According to the resource-based view of the firm (Barney,
1997), socioeconomic differentiation
is achievable when individual economies manage “unique” and
difficult-to-use resources.
Resources can be tangible (e.g. financial and physical assets),
intangible (e.g. asset quality), or
personnel-based (e.g. asset support and management skills)
(Grant, 1991). These resources
are difficult to imitate in their combination, which makes them
unique in their use. According to
Bharadwaj (2000), ICT resources serve as basic units of
analysis to create differential
advantage by their assemblage, integration, and deployment to
create capabilities.

Our proposed framework begins with ICT infrastructure
investments, commonly prompted by
capital outlays. Once the investments are in place, the challenge
becomes a matter of
translating the investments into resources that can provide rents
to an economy. However,
translating investments into resources is contingent upon the
degree of infrastructure adoption
and governance. Infrastructure development theories provide a
glimpse into the preconditions
and contingencies of developing infrastructure resources. For
example, Cogburn’s (2003) study
of how regimes are transformed to cater to emergent ICT trends
is indicative of governance
structures in both developing and developed countries.
Governance has to cater to institutional
pressures (Shirley, 1999) and diverse stakeholders (Cogburn,
2003), and is sometimes forced
to sway to accommodate dominant stakeholders. Such scenarios
abound in SSA where
particular investors can sway governance regimes.
However, if able to combine strategically, the countries of SSA
can harness their tangible,
intangible, and personnel resources to offer unique resource
capabilities. To elaborate, SSA is
trying to emerge as an economy built upon a regional alliance of
more than forty countries.
Together, they have the ability to wield a collective resource
potential. In other words, resources
are basic inputs; it is the socioeconomic differentiation that can
yield distinct resource outcomes
from internal resource combinations. In the context of SSA,
regimes and institutional influences
make the combination of these resources unique and inimitable.

Economic proposals in SSA
such as the Growth and Opportunity Act, along with
institutional pressures from emerging peer-
reviewed governance, have increased transparency, and the
development of objective ICT
policies allowing for the pooling of resources. Supportive
regimes (national and international)
and economic and policy restructuring, especially in relation to
ICTs, can streamline governance
and facilitate cooperative decision making in SSA (Cogburn,
2003).
While resources in SSA are ill-developed, proper governance
mechanisms can harness them
for innovative application and use, guided by social and
regional culture. For example, cellular
and satellite networks are gaining popularity as surrogates for
fixed landlines that lack
maintenance and are often severed during conflicts. Cellular and
satellite networks are
becoming the media of choice for delivering local, regional, and
international content. In SSA,
regimes and institutions are slowly organizing resources
(tangible, intangible, and personnel)
with an eye on local and global needs, changing the way people
“live, work, and play.”
Together, emerging regimes and institutional forces in SSA can
allow collective pooling of
resources and collective bargaining power, thus creating unique
resource combinations that are
difficult to imitate.
In terms of ICT development,tangible, intangible, and personnel
resources can work in
combination to provide a degree of inimitability. Once ICT
resources are developed, countries

must primarily focus on developing “capabilities” for the
diffusion of such resources. Bharadwaj
(2000 p. 171) defines capabilities as the “ability to mobilize and
deploy [ICT] resources in
combination or co-present with other resources.” The
mobilization of resources is thus
contingent upon how effectively infrastructure resources are
diffused through application. A lack
of capabilities has been the unfortunate case in SSA. Unplanned
ICT investments have led to a
predominance of standalone PC systems with no network or
LAN access. Among them, PC
users in a workplace might compete for only one or two that are
connected to the Public
Switched Telephone Network using modems, leading to severe
underutilization of the rest.
Most SSA countries have only lately understood that application
and use of existing ICT is a
prerequisite to the diffusion of information. Fidonet in Africa
serves as a prime example. Fidonet
grew as a bulletin board, “store and forward” system running on
PCs using dial-up lines and
legacy systems for exchanging email, files, and news briefs. It
was from the Fidonet gateway
that the South African UNINET-ZA, Worknet/Sangonet evolved
as one of the early academic
networks using this “low-cost,” “low-tech” approach (Thapisa,

1996). Unfortunately, few such
applications have emerged. In an attempt to blindly emulate the
west, SSA has capitulated to
acquiring technology while lacking the capability to apply
technology in solving real problems. IT
policies or strategic buying plans that are necessary to relate IT
acquisition to socioeconomic
benefits are generally non-existent (Odedra et al., 1993). Unable
to utilize or mobilize existing
infrastructure resources, SSA seems to be caught in a “scarce-
knowledge trap” (Thapisa, 1996).
As Odedra et al. (1993 p. 28) had rightly remarked, “At present,
the most pressing need in SSA
is not new systems, but rather the know-how to effectively use
what is already there.”
However, mobilizing existing resources requires a strategic
assessment of their potential
benefits. For SSA, such an assessment lies at the core of
developing ICT capabilities and
escaping the “scarce-knowledge trap.” The proposed
information ecosystem framework (Figure
1) addresses that very issue in the context of SSA and other
LDCs. The common threads that
bind SSA and other LDCs are based on the underutilization of
ICT, lack of prudent investments,
problematic governance, and failure to develop and apply ICT
for socioeconomic growth. This
ecosystem for SSA provides a cohesive representation of ICT
together with salient
socioeconomic consequences
The ecosystem framework begins with ICT investments,
intended toward the acquisition of
infrastructure, mainly in the form of gross national technology
budgets. Once capital is

committed to ICT, national technology strategies must drive
infrastructure adoption; that is, they
must determine strategic infrastructure priorities for
developmental objectives. Strategic
directives set the course for ICT policies that come into play in
infrastructure development. In
this stage, SSA must rely on the involvement of a critical mass
of users as well as development
and support personnel for the adopted infrastructure. With the
requisite number of users and
support and maintenance personnel, SSA must then take
measures to diffuse the infrastructure
for newer and more innovative applications. In the context of
SSA, infrastructure application
needs to be directed toward specific socioeconomic objectives.
Social development must look
toward outcomes such as telemedicine and online education.
Similarly, economic development
objectives must emphasize objectives such as electronic
commerce. These socioeconomic
outcomes derived from the application of ICT resources will
then affect future investment
considerations and future infrastructure development.
Furthermore, social and economic
outcomes both affect each other. For example, increasing
awareness about, and the use of,
telemedicine may prompt the growth of ancillary telemedicine
industries. Similarly, electronic
commerce may help increase access and use of telemedicine and
online education by using the
Internet as a conduit, thus narrowing the digital divide. The
information ecosystem framework
sets up a cohesive partnering of investments, development,
application, and socioeconomic
growth. For SSA, understanding the ecosystem would be a first
step toward any concerted

socioeconomic initiative.
With an ICT ecosystem as a guiding framework for researching
the impacts and potential of
ICTs in SSA, we now proceed to discuss each of the underlying
dimensions of the framework.
Vol. 6, No.5, pp.130-170/May 2005 140
We discuss the important role played by each of these
dimensions and identify some of the
important research issues that surface. We begin by
understanding how ICT is initially adopted,
specifically through ICT investments aimed at increasing
teledensity, and then by examining
how these investments can be converted to tangible and
intangible national ICT assets. The
subsequent sections then examine some important social and
economic applications of ICT
resources, specifically, telemedicine, online education, and e-
commerce.
ICT Infrastructure Investments, Adoption, and Development
Colonial rule in SSA allowed occupying countries to install
telecommunications infrastructures to
serve their ad-hoc administrative needs. Post-colonial rule was
an exercise in conflict,
prompting world powers to make decisions through aid efforts

and developmental advice.
Influenced by expatriate consultants, SSA has embarked on a
perilous attempt to mimic the
Western world in its ICT initiatives. Computerization has been
a function of the multi-national
expatriate community, aid agencies, or blind acquisition.
According to Odedra et al. (1993), in
the mid 1980s, more than 50% of Africa’s computer
installations were donated, and the
percentage in SSA alone was considerably higher. Other
installations have been leftovers from
expatriate projects. The rest have been pushed by vendors who
have found SSA an attractive
market where questions about ICT concern the latest design,
rather than the sophistication of
use. Many times the countries of SSA have seen ICT handed to
them free of cost, with little
instruction on their operation and effective use. Foreign aid has
not only forced SSA to
unconditionally accept what is given, but also complicates the
situation by failing to provide
training or support while bearing the recurrent costs of
equipment maintenance, all of which cost
money. To make matters worse, the implementations of ICT are
generally tied to donor
countries, implicating additional capital provisions for future
maintenance, support, and
consulting (Odedra et al., 1993). The findings unanimously
point toward a total failure in
technology transfer, leading to ICT dumping rather than
concerted adoption. As Odedra (1993
p. 43) laments,
Many of the internationally well known manufacturers and
suppliers that have set

up shop in Africa are notorious for manipulating management
and decision-
makers into buying their equipment, providing very poor after-
sales service,
especially maintenance and training, and often providing
obsolete technology.
Their main concern is in selling “boxes” at inflated prices and
not in transferring
technology.
Consequently, SSA, already afflicted with paltry ICT, suffers
from serious underutilization of
equipment. Such factors have contributed to questionable
adoption practices, resulting in dismal
teledensity statistics.
The lack of basic telecommunications infrastructure is a severe
hindrance to the growth of the
ICT in any country (Jensen, 1999). Previous research has
associated the level of a country’s
basic telecommunications infrastructure with its teledensity
(Mbarika et al., 2002b), defined as
the number of land telephone lines per 100 people. While
telephone lines have been
traditionally used for voice communications, in virtually every
country of the world, when the
market sufficiently matured for such a need, they have
eventually formed the national backbone
of data telecommunications. Thus, teledensity remains an
important indicator, if only a proxy, of
national telecommunications infrastructure. For example,
research on Latin America has
identified low levels of teledensity as the main bottleneck for
growth of ICT (Hunt, 1997;
Pegasus Research, 2003; Wellenius, 1984). Although wireless

telecommunications media such
as cellular telephony and VSAT are in the early adoption stage
in SSA, research to date still
views land line teledensity as a fundamental factor for ICT
development.
SSA significantly lags behind other regions of the world in
terms of teledensity, and with this
disadvantage, the prospects of catching up with more developed
countries in terms of ICT
adoption look grim. While there are only 2.77 main telephone
lines per 100 persons in all of
Africa, there is less than one telephone line per 100 persons for
most SSA countries (see
Appendix B). These figures are substantially lower than even
the 1998 figures of 7 per 100 in
Asia, 10 in Latin America and the Caribbean, 37 in Europe, and
66 in the United States
(UNECA, 1999a). Notwithstanding the fundamental role of
teledensity for the SSA region, a
focus to develop just the teledensity infrastructure will be a
major mistake, given the rapid
growth of wireless infrastructures; hence the need to re-visit the
teledensity concept arises.
Although teledensity has traditionally only regarded land-based
telephone lines, with the rapid
adoption of wireless telecommunications media such as cellular

telephony and VSAT, this
concept will need to be expanded to include other measures of
the state and extent of
telecommunications infrastructure (Kibati and Krairit, 1999;
Peha, 1999). SSA’s size and
topography makes landline installation and maintenance an
expensive proposition. In contrast,
wireless connections such as VSAT and cellular infrastructure
are physically independent. Yet
the research to date has almost exclusively employed the
traditional measurement that
considered only landlines. Traditional teledensity counts the
number of landlines, whereas a
contemporary calculation would consider each mobile telephone
subscription to be a wireless
“line.” Appendix B lists the teledensities of all the countries in
SSA, distinguishing between
landline and mobile-phone teledensities. While SSA’s landline
teledensity doubled from 0.4 lines
per 100 citizens in 1991 to 0.9 per 100 in 2002, the mobile
teledensity shot from virtually zero in
1991 to 1.9 mobile phone subscriptions per 100 citizens in
2002. Many of these are digital
connections, which pave the way for access to ICT in countries
where most citizens cannot
afford personal computers. In the future, it is likely that
wireless communications will be more
relevant than wired means for the development of SSA’s data
communications networks.
Even though most countries in Africa have established ICT
networks, access is mostly restricted
to the major cities, and it is quite expensive. In 1999, the
average total cost of using a local
dialup Internet account for 20 hours a month in Africa was
about $68(US) per month. These

costs include usage fees and local call telephone time, but not
telephone line rental. When
compared to SSA’s 2002 per capita GDP of US$29 per month
(compared to the United States’
monthly per capita GDP of $3,019), it is obvious that personal
Internet accounts are out of the
reach for the vast majority of citizens. The monopolistic and
parochial culture of
telecommunication providers in Africa is reflected in the
exorbitant tariffs charged in an age of
diminishing costs (Adam, 1996). In addition, a considerable
portion of African telephone
switching is still done using analog equipment that makes it
even more difficult to network digital
traffic using computers. Furthermore, government-run
telecommunication monopolies view
telecommunications as a low priority issue only available to a
select few, typically the urban
“elite.” Such restrictive practices have isolated a major part of
the population (which is about
70% rural) from being able to access information. Misdirected
telecommunication investments
created an absurd situation where intra-African communications
were routed via Europe,
leading to transit charges in the hundreds of millions of dollars.
In addition, restrictive regimes
and practices have stifled emergent technologies, especially
wireless telecommunications,
making the issue even more acute in the case of Africa’s vast
rural population who remain
captive to their inability to access information. Overtly
regulated and covertly restrictive,
information inequality is markedly high due to unscrupulous
business practices and capricious
public policy (Adam, 1996). This further contributes to high
telephone, and by extension, high

Vol. 6, No.5, pp.130-170/May 2005 142
Internet connection costs (Figure 2). While average access costs
for SSA are approximately
$55 for 20 hours per month, access costs in Western Europe and
USA average approximately
$20 for unlimited monthly use (ITU, 2001).
SSA has seen some potential ICT adoption problems because of
capricious business venturing
and restrictive governance. AT&T’s Africa ONE high capacity
undersea fiber optic cable was to
encircle Africa and provide it with a high-speed backbone, but
the project was rejected by
landlocked countries that refused to cooperate, feeling that they
would be left out of the
development. The adoption of GMPCS (Global Mobile Personal
Communication Systems) in
Figure 2. Dialup Access Costs And Teledensity In SSA

SSA also met strong resistance. GMPCS is a satellite-based
communication system designed
to use fewer infrastructure resources and service providers than
other satellite systems. The
idea of a single gateway to serve a region rather than a country
would presumably be a
welcome option for SSA. On the contrary, the lack of a
domestic interconnection point
infrastructure for communicating with the existing network was
perceived as a regulatory
impediment. As a result, an antipathy for the technology grew
among SSA regulatory
authorities, who equated the loss of country-specific licensing
revenues with the loss of control.
According to Adam (1996), governance problems that have
impacted ICT adoption were related
to a gamut of problems stemming from a distinct lack of
coordination among SSA countries with
equivocal ICT agendas to language barriers, unyielding
monopolies, and obsolete regulatory
practices. Altogether, this has resulted in disparate practices,
with SSA countries working
against each other rather than cooperating.
However, SSA is proactively questioning its governance
patterns as it stands poised between
development and decay. The drawing up of the New Partnership
for Africa’s Development, a
peer review process aimed at improving governance and
integration, has been welcomed as a
step toward economic and political stability. Having overcome

politics to a certain degree, Africa
has been able to involve 36 telecommunications operators and
various governments to help
combine three telecommunications initiatives for increasing
teledensity: the SAT3 cable
between South Africa and Europe; the SAFE (South Africa Far
East) cable between Africa and
the Far East; and the West African Submarine Cable (WASC),
in an attempt to link the whole of
Africa. Such bold steps are a sign that SSA is taking the
information revolution seriously. These
progressive maneuvers are reflected in ICT growth rates. In
1997, fewer than 12 countries in
SSA had Internet access; in 2000, with the exception of Somalia
and the Republic of Congo, all
of SSA had access to the Internet, capitalizing on about a 20%
growth rate between 1999 and
2000 (World Bank, 2001)—today, all countries are connected.
However, even with such
dramatic improvements, Internet access remains a distant reality
for most SSA citizens.
In addition to fixed lines, wireless technologies can
significantly improve the teledensity
statistics. Fixed lines need the physical laying of copper cables,
telephone poles, and switches,
all of which are subject to disruptions in the events of severe
weather and human intervention
(for example, civil conflicts where telephone wires are severed
to cut off communications). But
the privatization or liberalization of telecommunications across
most SSA countries is offering
opportunities to use newer forms of technologies that are
unimpeded by typical landline service
disruptions, and simultaneously utilizing the available radio
frequencies for communications.

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