Winning in Africa: Focusing on Localisation and Empowering Women and The Youth

On Africa Day this year, I published an article entitled What Does It Take To Win In Africa? Some Key Critical Success Factors. The attention that piece attracted showed me the importance of the topic and Africa as an investment destination. So, I decided to revisit the topic to go deeper and provide examples of entities that have made it in Africa and those that have not been so successful. I use these examples to show what it takes to win in Africa. 

I have always said that when it comes to winning in Africa, the beginning of wisdom is the realisation that the continent is a tale of two cities. It is a tale of two cities in that, in the continent, you will find affluent areas such as Lago’s Banana Island, South Africa’s Atlantic Seaboard, and the Seychelles’ Eden Island. In the same continent, you will also encounter the kind of poverty represented by the informal settlements of Kibera in Nairobi, Accra’s  Agbogbloshie, and Cape Town’s Khayelitsha. 

I will provide some examples of businesses that have won in Africa and those that have failed. I will also focus on why an organisation must immerse itself in its target country by working with the locals, leveraging their wisdom, and focusing on women and youth empowerment.

The population of Africa is estimated to be over 1.4 billion, about 18% of the world population.

About 45% (over 650 million) of the African population lives in urban areas.

Africa’s median age is about 19 years.

The African population is expected to rise to over 1.5 billion by 2025.

By 2050, the African population is projected to be nearly 2.5 billion, with around 60% living in urban areas. 

Click here for main data source

I have often noticed that companies that do well in Africa are those with an effective localisation strategy. By localisation, I mean the extent to which an entity can understand the community in which it seeks to operate so that it can speak the language of those communities, participate in their traditions, and operate in a manner that respects their cultures. 

Nestle, the Swiss multinational food and drink processing conglomerate, is one of the best examples of companies that have done well in Africa through understanding the importance of working and immersing themselves in local communities. 

When Nestle says it believes in Africa, it walks the talk. The company’s success in Africa is there for all to see. It has 19 factories in the continent and employs more than 6,600 people in Central and West Africa and 3,700 in South Africa alone. Nestle uses more than 50,000 local suppliers in Africa. 

Generally, Nestle’s success in Africa can be attributed to its understanding of the needs of its customers and suppliers on the continent. It helps farmers embrace sustainable farming practices. This indicates that the company understands that success in Africa depends on patience and willingness to make a fortune, not just for the business but also for the people behind the business’ success.

When I look at examples of companies that failed to read the room when they entered Africa, I think of Airtel. This Indian multinational telecommunications services company found the African market a tougher cookie to crack than its executives had initially anticipated. After several attempts to enter Africa, the business would eventually divest some of its assets, which can be seen as an indication that the company was not doing so well on the continent. 

When preparing for this piece, I tried to find out what went wrong for Airtel in Africa. I came across a Financial Times article by Katrina Manson in Nairobi. She argues that Airtel’s challenges could be linked to the “one size fits all” approach by global companies operating in Africa.

Katrina writes, “Images of the savannah, actors from South Africa, along with the use of coins – when many Africans use only paper money – had limited the advert’s appeal in some parts of the continent, no good for a company with business in 17 African countries.” This indicates that hiring local talent, finding local consultants, and immersing yourself in the community to gain their insights is vital. This should form the core of the localisation strategy.

According to the World Bank’s Director of Strategy and Operations for the Africa Region, Diariétou Gaye, “Africa is the only region in the world where more women than men choose to become entrepreneurs.” Therefore, anyone who wants to win in Africa cannot afford to ignore the contribution of women. Specific initiatives could involve availing leadership training to represent them in all spheres of governance and policy making.  

If Africa’s main advantage comes from its youthful population, we must invest in the youth. The United Nations Development Programme agrees,  “Investments in youth talent are crucial for the continent's development trajectory and for increasing Global South and African ownership over the path ahead.” Youth empowerment involves including them in decision-making and a willingness to provide them with opportunities to gain experience through internships and volunteering, mentoring, and availing of scholarships,  

Mastercard, the global payment processing firm, is a great example of an organisation that understands the importance of empowering women and the youth in Africa. Through the Mastercard Foundation, the company provides funding that supports youth and women-led small and medium enterprises. This initiative is a great example of how organisations that want to operate in Africa should focus on helping communities solve their most pressing challenges.

With its wide range of natural resources and youthful population, there is no wonder why Africa is called “the last frontier.” Many have proposed that if Africa sustains its current momentum, it can emulate the Chinese success story. Those who will benefit from the continent’s full potential are those who are willing to invest now while the opportunity is still open. It is those who understand that while Africa has its pocket of instability and other short-term challenges, it remains the continent with the greatest potential.