Digital Economy, Digital Labour

Digital labour platforms as winner-takes-all markets: implications for fair work standards

A number of contributions in the DIODE blog series have focused on how digital labour platforms such as Upwork and Freelancer provide new economic opportunities for online freelancers, particularly in the Global South. Subsequently, relevant questions have been raised on the precarious nature of digital gig work (see e.g. blogs by Balaji Parthasarathy, August 2018; Richard Heeks, July 2018; Mark Graham, December 2017), and how the regulatory framework for platforms can be strengthened to guarantee ‘fair work’ principles for those active on digital platforms. Initiatives towards third-party monitoring and certification in this field, and how decent work standards can be met, are interesting and should receive broad-based support. However, through the very nature of their functioning, digital labour platforms will always be plagued by a level of unfairness, which will be discussed in this blog-post.

One central but largely unexplored topic in the literature on digital labour is what it takes to be successful on digital labour platforms. As its central features, the competition for work is global, employment relations are flexible, and individuals rely on reviews and performance scores for securing new jobs. In practice, financial gains on digital labour platforms are highly uneven with a small number of freelancers securing the majority of the jobs. In management circles this would be regarded as the 80/20 rule (pareto principle), which in this case refers to the situation that 80 percent of the work is likely done by only 20 percent of the freelancers that are registered on the platform. In a similar vein, digital labour platforms are a typical example of a winner-takes-all market. The concept winner-takes-all markets was originally developed by Frank and Cook (1995, 2013) to highlight the emergence of top-earners in particular professions such as sports, music or other creative professions. In the digital economy the winner-takes-all principle can be identified at two levels: the digital platform industry at large, where platforms such as Facebook, Uber, Amazon.com and Upwork currently dominate their market niches, and for those working via platforms. Formal entry barriers to digital labour platforms are low, which means that anyone literate with a computer and access to the Internet can sign up. However, successful participation in digital labour platforms is a complex game because of the diversity of actors involved.

Whereas in local or national labour markets most buyers and sellers of labour share common grounds in terms of cultural background, education, and their understanding of what represent good work skills, work ethics and decent pay, this is not true on global digital labour platforms. Here, clients posting a job are likely to be presented with freelancers that are based, raised and educated somewhere half a world away in a profoundly different socio-cultural and educational context than the client’s. This creates an assessment challenge for clients, and adds a measure of uncertainty to hiring transactions. An additional measure of uncertainty is created by the digital nature of the working relation between clients and contractors. With clients and contractors at a distance and chances of them ever meeting in person being slim, the embedded relations and social monitoring and sanctioning mechanisms that encourage people to perform well and live up to their promises in offline working environments carry less weight, making it easier for either freelancers or clients to disengage or otherwise fail their counterparts. Under such conditions, contractors with good credentials (or a good digital reputation) are more likely to make it to the shortlists of clients looking for someone to hire. They are also more likely to be rehired and be able to secure higher wages for their ‘proven’ trustworthiness.

Skills-tests via digital labour platforms are the most obvious way for new entrants to show their capacity and to reduce uncertainty of clients. Surprisingly, Upwork (the largest global platform for digital work) announced in July 2019 that it will remove the various skills tests on offer via the platform, as clients didn’t find skills tests important when making hiring decisions. Rather, according to Upwork, clients consider profile introductions, portfolios, and job feedback a better showcase of a freelancer’s skills and experience. This shows the very nature through which digital labour platforms evolve for freelancers into winner-takes-all markets as it favours the more established freelancers with good credentials (for example a high performance rating and positive feedback). When client-generated feedback constitutes an important part of contractor credentials and is used by clients to (largely) base their hiring decisions upon, it favours contractors who have already received good feedback and it puts newcomers that have not yet had their chance to accumulate good feedback and build a digital reputation at a disadvantage. Such effects are likely to be more pronounced if clients in their assessment of potential contractors, have a strong interest in qualities that can be demonstrated only ‘on the job’ and not easily upfront. This increases clients’ reliance on the feedback received by contractors from other clients, and thus reinforces the importance of the feedback loop. This makes the platforms prone to exclusionary effects (in addition to distribution effects) as newcomers will have a hard time establishing a foothold in the market.

To conclude, the greatest contradiction of digital labour platforms is that success is very visible (e.g. through information on profile pages of freelancers) and newcomers are often lured to join (see blog by Niels Beerepoot, September 2017) but securing a position in this market is a major challenge. New entrants need to overcome barriers of uncertainty and lack of a digital reputation. These particularities in the functioning of digital labour platforms are hard to integrate when defining fair work standards but to a large extent determine how freelancers perceive digital gig work. Fair work standards are now oriented towards those who have acquired a seat at the table where joining the table is the hardest task.

Frank, R. & P. Cook (1995). The Winner-Take-All Society: Why the Few at the Top Get So Much More Than the Rest of Us. New York: Martin Kessler Books
Frank, R. & P. Cook (2013) Winner-Take-All Markets. Studies in Microeconomics Vol. 1 (2): 131-154. Continue reading “Digital labour platforms as winner-takes-all markets: implications for fair work standards”

Digital Economy, Digital Enterprise

Data Marketplace as an Enabler for Data-Driven Innovations in Developing Countries

In today’s digital era, data have become a valuable resource for digital enterprise to innovate and stay competitive in the market. This also applies to developing countries, where start-ups offer new digital products and services and transform everyday lives. One way to realize data-driven innovations is by sharing data among parties and even competitors to generate new insights and improve the quality of products or services.

In this context, data marketplaces are emerging, which are described as platforms that bring multiple parties together to exchange data with each other. Data marketplaces could play a key role in enabling data-driven innovations for digital enterprises in developing countries since they face a significantly different challenges in terms of resources and capabilities than digital enterprises in developed countries. More importantly, data marketplaces might generate value for digital enterprises in developing countries, because new insights can be generated by analyzing data from multiple sources.

Various initiatives and pilots on data marketplaces are available (e.g. OpenDataSoft, Azure Data Market, Data Market Austria). However, they often struggle and fail to survive. This is mainly due to lack of trust, fear of losing competitive advantage when sharing data, or the risk of violating strict privacy regulations (e.g. GDPR). To tackle these challenges, in the Safe-DEED project (Safe Data-Enabled Economic Development) we focus on developing new privacy-preserving technologies to enable firms to expose data via data marketplaces without giving access to actual data. We are also conducting multi-actor business model research in order to bring those technologies to the market in a sustainable way so that digital enterprises can generate value from such a platform.

How is this relevant to the digital economy and development? There are several possible use cases within the digital economy and development context. For instance, SMEs could benefit from accessing data and information provided by other SMEs in data marketplaces to support market research, so that they can formulate a better strategy to reach their target market. Digital enterprises providing on-demand transportation services could also expose their data via data marketplaces, and support the government in developing traffic policies without revealing sensitive information. Furthermore, a peer-to-peer lending platform focusing on providing loans in rural areas can also expose data to conventional banks via data marketplaces to get a better picture of unbanked population in a country so that they can collaborate in achieving financial inclusion.

Of course, there are several challenges in realizing data marketplaces that are safe and secure, such as convincing the first couple of firms to join the data marketplace platform, the impact of such an innovation on trust, ethics, security, and finding a sustainable business model for the data marketplace itself. Hopefully, answers to these challenges will be available by the end of this project.

More information:

  1. Safe-DEED website: https://safe-deed.eu
  2. Finding a Business Model for Decentralized Data Marketplaces: https://safe-deed.eu/finding-a-business-model-for-decentralized-data-marketplaces
  3. Safe and secure data marketplaces for innovation: https://www.tudelft.nl/en/tpm/research/projects/safe-and-secure-data-marketplaces-for-innovation
Digital Economy

The Next Billion Users and the Future of the Digital Economy

In an interview with Kai-fu Lee, the former executive at Apple and Microsoft, ex-president of Google China and prominent venture capitalist and AI expert is asked to give advice to startups in Europe hoping to forge a path alongside global tech giants from the US and China. He suggests that, “if you want to experiment, find some truly underdeveloped country where there is nothing [my emphasis] and try your idea there.”

The Global South have long been framed in colonial terms and clearly continues to be so. The empty or vacant land theory was propagated by the European colonizers to justify the seizure and systemic exploitation of sovereign countries and their people. Some tech evangelists and media outlets continue to evoke this rhetoric to emphasize the so called major disruption of technological innovation. Sugata Mitra, the Ed Tech guru and winner of the TED prize has for the last decade emphasized local communities in developing countries as a void so remote and so devastating that any intervention is a godsend. For instance, when Mitra’s team was criticized because their tech experiments did not produce deep learning, they responded defensively by stating that, “we are describing a part of our planet where children with nothing [my emphasis] other than a street-side computer, are able to answer tests on their own. They have no teachers or educational support from their parents or anyone else in the community…”

In May 2019, The Economist released their weekly issue featuring on their cover “The new scramble for Africa” with a byline that read, “…this time, the winners could be Africans themselves.” The language of “scrambling” for land in terms of winners and losers perpetuates a people-less territory ripe for carving, masking the actual bloodied history. The popular usage of the metaphor of data as the “new oil” or data “mining” is inadvertently shaping our discourses on the data economy in terms that are dangerously reminiscent of the colonial past – where the focus is on the data and not on the people who create and consume that data.

Another colonial theory is the infantilism of the natives that require paternalistic enabling for them to progress. In my 2016 UNESCO commissioned research on contemporary digital innovation for emerging economies, several tech start-ups designing applications for social good positioned their innovations as completely autonomous and all-inclusive, and moreover, as legitimate alternatives to “failed” institutions like schools and other vital social agencies. Apparently, the Global South awaits for these tech messiahs to rescue them while amidst their institutional corpses.

The media and the tech industry at large are waking up to the fact that the next billion users are emerging from the Global South and can significantly change the future landscape of the digital economy. The game of commodifying people and vacating of territory begins all over again. All the more reason why we need to move ahead with much caution before we become complicit in feeding certain myths: fictions such as how these users are overtly utility-driven and instrumental in their usage (a major expectation driving funding agencies), that they don’t care about their privacy, that they are far more self-driven and self-organized than “us” in the West and hence can do without conventional institutions, and that they are intrinsically communal, continue to circulate and shape the imagination of many tech corporations, aid agencies, and state actors.

I have argued in my new book The Next Billion Users that if innovation continues to be framed along these lines, then what the global poor need is less innovation. If innovation is a proxy for pilot projects that uses these communities as blank slates, they are better off without them. They should not be guinea pigs for new technology. The simple fact that a given technology is novel should not in itself be a reason to use it to experiment on these people. No new technology can be a stand-alone solution. Without motivated communities, no technology will succeed. The global poor have long been used as test subjects for socio-technical experiments. They are approached in the same way as patients for an experimental clinical trial who have run out of all conventional options—as people who have nothing to lose.

It is more likely that they had few genuine choices to start with. The failure to provide real options to the poor can occur in spite of major commitments by a nation to reduce the social inequalities. Fixing institutions is not an easy or a quick task. Scarce resources, political turmoil, and discriminatory cultural practices are just some of the many obstacles. Sometimes poor nations, driven by national pride, choose shortcuts out of an urgency to “catch up”— hoping that technological innovations will magically erase long- standing inequalities.

Why are failed institutional reforms so unforgivable, while failed technologies are viewed as acceptable trajectories for innovation? This mindset can be tremendously debilitating for communities who need to persist and leverage on new technologies in ways that are often more incremental than astronomical, more marginal than central to social reform. Far from nothingness, we have a complex and rich history of social resilience that should form the basis for envisioning the future of the digital economy with the rise of the next billion users

Digital Economy

Mobile Financial Services for Developing Communities

Guest Authored by: Srihari Hulikal Muralidhar, Aarhus University, Denmark

ICTD research has been grappling with the question of how to harness the potential benefits of technology towards various developmental goals in the contexts of education, healthcare and so on for a long time. Technology’s ‘reach’ gets extended through the diffusion of smartphones and internet, as they enable new possibilities in terms of designing suitable products, services and targeted interventions. The Government of India, taking note of this trend, charted a ‘Digital India’ vision, wherein it wants to enable citizens to avail certain public services via their smartphones[1]. As a first step, under the Prime Minister’s Financial Inclusion Mission, banks were mandated to open at least one account for every household in the country. The next step in this process was linking the beneficiaries’ unique national ID and tax number to their bank accounts. Subsequent to this, the government moved welfare payments (pensions) and subsidies (such as fuel subsidies to poor households) from cash to digital, where the benefits were transferred electronically to the beneficiaries’ bank accounts. Some estimates claim that this reduced corruption and pilferage by more than 40% (Business Standard 2018). The biggest challenge, however, has been with the ‘last mile connectivity’ i.e. making certain essential services accessible to citizens. It is here that smartphones and affordable data are expected to offer novel opportunities.

One of the biggest problems with mobile money usage in India has been the siloed use. Mobile money services have been used only for particular activities because of a lack of adequate support, training, and proper integration with the larger ecosystem within which the technologies are embedded (O’Neill, Dhareshwar and Muralidhar 2017, Nandhi 2018). However, with app-based services becoming increasingly prevalent (such as Uber, Ola, Swiggy), some changes have occurred. One positive spillover is that they have enabled gig workers such as delivery executives and drivers to acquire a certain level of digital literacy wherein they have learnt to use smartphones and become familiar and comfortable using the internet[2]. Rickshaw drivers and Swiggy delivery executives, for instance, now use Google Maps as part of their everyday work. Previous studies on digital payments adoption have shown that there’s a path dependency exhibited wherein people already familiar with and using technology are more likely to perceive digital payments as beneficial and adopt it, and those unfamiliar might be hesitant because of concerns over trust and security (Pal et al 2018). However, with technological innovations changing the socio-economic landscape, benefits from technology use are enabled even for those who might not be comfortable using it through intermediated use (Sambasivan et al 2010), often by family members. 

In this context, certain initiatives such as the BHIM (Bharat Interface for Money) app launched by the Indian Government, which is based on UPI (Unified Payment Interface)[3] show some initial promise. For instance, with this app, a user can create a unique UPI ID (which can be something as simple as their mobile number@upi), link their bank account to the ID, and conduct financial transactions such as P2P transfers, bill payments, and so on. The user can also access their bank account balance on the app itself. In addition to the government-launched BHIM, private players have also entered the mobile payments market in the country, with PayTM, PhonePe, and Google Pay being the most prominent examples. Two important factors need to be considered in this context. First, urban low-income communities such as rickshaw and cab drivers in India have not used devices like desktops or laptops and will probably never use it. Consequently, smartphone adoption and use has been a case of technological ‘leapfrogging’ and enabled digital inclusion. It has also been their first ever experience with the internet. Second, a vast majority of internet users in India use WhatsApp; in fact, India accounts for the largest user-base for WhatsApp[4]. Realizing the potential that the mobile payments market in India holds, WhatsApp is set to roll out its Payments app soon[5].

The idea of a chat application with an embedded payment interface (which allows the user to directly access their bank account from the app, amongst other things) offers new possibilities in terms of development interventions even for low-literate, low-income users. That said, the point is not claim that access alone will be sufficient in achieving financial inclusion. Rather, interfaces built on top of chat-based platforms, with which even low-literate, novice users are familiar, can be a viable way of making digital financial services accessible for them. These interventions can take a variety of forms (such as assisting with accessing financial info, tracking of personal finances, and so on) and by no means need to only be about payments. It also makes sense to think about designing interventions around supporting users’ existing financial practices and not just replace them with digital technology. Previous research has also highlighted the highly collaborative nature of household financial management (Snow and Vyas 2015), and therefore, directions for future work could also include how to design for collaboration than eliminate it.

References

Nandhi, Mani A. 2018. Effects of Mobile Banking on the Savings Practices of Low-Income Users – The Indian Experience. In Money at the Margins: Global Perspectives on Technology, Financial Inclusion and Design. Bill Maurer, Smoki Musaraj and Ivan Small (Eds.). pp. 266-286. Berghahn Books. 

O’Neill, Jacki, Anupama Dhareshwar, and Srihari H Muralidhar. 2017. Working Digital Money into a Cash Economy: The Collaborative Work of Loan Payment. Journal of Computer Supported Cooperative Work. Vol. 26. Pp. 733-768. Springer.

Pal, Joyojeet, Priyank Chandra, Vaishnav Kameswaran, Aakanksha Parameshwar, Sneha Joshi, and Aditya Johri. 2018. Digital Payment and its Discontents: Street Shops and the Indian Government’s Push for Cashless Transactions. In Proceedings of CHI’18. ACM. 

Sambasivan, Nithya, Ed Cutrell, Kentaro Toyama, and Bonnie Nardi. 2010. Intermediated Technology Use in Developing Communities. In Proceedings of CHI’10. Pp. 2583-2592. ACM.

Snow, Stephen, and Dhaval Vyas. 2015. Fostering Collaboration in the Management of Family Finances. In Proceedings of OzCHI’15. Pp. 380-387. ACM.

Standard, Business. 2018. 190mn Indian adults don’t have bank account, says World Bank report. April 19, 2018. Retrieved from https://www.business-standard.com/article/finance/190-mn-indian-adults-don-t-have-bank-account-says-world-bank-report-118041900972_1.html  

Notes

[1] https://www.digitalindia.gov.in/

[2] Our own experience in the field has shown, however, that use of internet is often limited to most popular applications such as WhatsApp, YouTube, Google Maps and sometimes Facebook.

[3] Unified Payments Interface is a real-time payment system developed by the National Payments Corporation of India (NPCI) to enable multiple financial services such as P2P transfers, merchant payments, and so on to be availed through a mobile application. Unlike M-PESA (Kenya), which is a feature phone app only, or Swish (Sweden) which can be used only on smartphone, UPI can be used by both smartphone (via an app) and non-smartphone users (via USSD code). https://www.npci.org.in/product-overview/upi-product-overview 

[4] https://venturebeat.com/2018/07/04/whatsapp-says-collective-action-required-to-combat-the-spread-of-misinformation-in-india/

[5] WhatsApp had applied for a UPI license almost a year ago but the Government is yet to approve because of concerns over privacy and data storage. The Indian Government, in the aftermath of the Cambridge Analytica scandal, was wary of user data from India being stored outside of the country and insisted on local data storage. Facebook, which owns WhatsApp, only recently acceded to this stipulation. 


Digital Economy

Using Digital Advances to Develop African Scholars of Business and Management

Arguably the best way to find out how well the digital economy can support development is to try and use it for that purpose. That is what I did when I in 2013 redesigned the doctoral programme of the Gordon Institute of Business Science (GIBS) of the University of Pretoria in South Africa to follow a blended learning design.

Most of the well-regarded PhD programmes in the world assume that students will be on campus and working on the PhD full-time. Universities need to obtain resources to pay a stipend to their PhD students so that students can support themselves. The PhD students benefit from the time to immerse themselves in the topic, but importantly also from being part of a community of people with similar interests.  

Unfortunately, this scenario does not describe doctoral training in Africa. Many academics in wider Africa do not have PhDs, and although that increases the demand for supervision, it also means that there is a real lack of local supervisory capacity. The few available supervisors are typically overloaded, and work in isolation from what scholars elsewhere are doing.

It is also virtually unheard-of that PhDs on the African continent are pursued full-time; there simply are not enough resources to pay for PhD studies. This is not only because of the direct costs of paying stipends, but also the opportunity cost of taking skilled people (even if only temporarily) out of a system where resources generally and specifically skills are scarce. Faculty in these locations have a heavy teaching load, and often assume responsibilities beyond what would be expected from faculty elsewhere. Committees are a bane in the life of all working professionals, but giving pastoral (and sometimes practical) care to often desperately poor students, and advising government representatives at various levels are additional tasks that devour the time of African lecturers at nominally “junior” positions.

The faculty members at African universities have typically been star students who were asked to assume lecturing duties as soon as they had completed a Masters degree. By the time they realise the importance of getting a PhD, they are professionally deeply embedded in their universities. Although they can resign and pursue a PhD elsewhere, going abroad for a PhD is disruptive from a personal perspective. Many faculty members are responsible for older family members and often also young families. Having to live far away from the people of whom they need to take care and/or having to fund expenses in expensive countries often deter faculty from seeking doctoral studies abroad. 

From a practical perspective, a PhD is needed for promotion in the academic system. More substantively, the research training that is part of a PhD allows people to rigorously examine and make sense of their world. The lack of trained scholars who are from and in Africa contributes to a vicious cycle where only very limited knowledge can emerge from a context that desperately needs a better understanding of its challenges.

But these concerns seem manageable when we take seriously the potential of recent digital developments. The promise of digital is that supervisors and students need not be physically in the same space, that communities can span multiple countries, and that libraries are as far away as a keyboard.

It was with this in mind that I redesigned the doctoral programme at GIBS to be a blended learning programme. There were on-campus sessions for a week every two months, but in the interim students had to deliver a substantial body of work online.

I used the logic of a conference in designing the programme. The on-campus sessions were filled with the energy and engagement that characterise a typical conference, while the “real work” happened before and after then. In between the on-campus sessions, students had to submit work where they showed that they had read and engaged with key texts. Given how important peer review is in the scholarly process, we expected of them to share their work with their peers – and assessed how well they reviewed the work of other PhD students, as well as how well they responded to others’ comments. In a few cases, we expected of students to work in small groups.

Most of the on-campus sessions served to further develop the work that had been delivered in the interim. Students presented (and were given feedback on) their work in progress. They in-person debated the work that they had read beforehand. They sometimes skipped class to sit and work through a knotty problem that had emerged earlier in the week so that they could benefit from the input of the group. And each on-campus had a session with an explicitly social purpose to help strengthen the support networks that kept students going through the multiple demands of the PhD, work and family.

The design works. In 2016, 2017 and 2018 respectively the number of doctoral graduates grew from three to six to thirteen. A number of them won awards – for example, the 2017 overall winner of the best dissertation from an emerging economy for the international Production and Operations Managements Society, and the Emerald award for best the doctoral study in Leadership and Organization Development. Thanks to a grant of the IDRC, we were able to support academics from wider Africa. For the four who have already graduated, it is gratifying to see how the PhD is helping their careers take off. 

But it would be wrong to ascribe the success of the design to its digital component. Not only because every successful intervention has to have multiple elements, but also because the digital element was perhaps the least reliable of all.

For PhD students who need to read (and before then, download) a mass of material, having reliable internet access is essential. For PhD students who engage with their faculty and fellow students through an online portal it is non-negotiable. Internet access exists across Africa, but it is not entirely reliable.

One Kenyan student found that her church had reliable internet, and developed the habit of taking her laptop to church to make sure that she was up to date with her online work. Another Kenyan student who was a development worker who occasionally had to go to Sudan, would simply disappear from view for weeks at a time. The fellow students of a Nigerian student were surprised when he dropped out of a conference meeting without a word of notice, but decided to continue. He showed up again ten minutes later: The power had gone off. He needed to get the generator going and then reboot the router before he could rejoin his fellow students.

Faculty had similar experiences with students from wider Africa, but faculty cannot afford to be as laissez faire as students can. Very soon it was decided that synchronous modes of conversation were simply too risky. Electronic connectedness worked well enough as long as one did not expect immediate responses. And there was a new manifestation of “the dog ate my homework”: Connectivity seemed to disappear just as students needed to submit their work. Of course we could not be sure, but it often seemed as if the less diligent the student, the less reliable the internet… It took some effort before we had developed internal processes that honoured the process of learning as well as the students who were battling with often-unreliable internet access.

Although the learning platform seemed to work well enough – there were outages, but they were planned and outages were clearly communicated – very little student activity happened on the site. Eventually we figured out what was happening: Students had created whatsapp groups and were actively connecting through those groups.

Of course, whatsapp was also made possible by digitisation. It was not purpose-built for learning, and the students’ whatsapp groups exclude faculty. (Yes, we were explicitly told that we are not welcome – that part of the purpose of those groups was to complain about us!) Who knows what happens in those groups. As faculty, we observe what appears to be epidemics of odd methodological decisions, and suspect that the origins of those epidemics can be traced back to a whatsapp conversation.

But what we cannot deny is that there is a community of new scholars who would not have existed without the internet. We know that students are able to get better supervision than they would have been able to get in their home countries, and we know that they feel agentic enough to craft a way of staying connected that makes sense to them.

As faculty, we have had to learn. We still do not know how to accurately estimate the “teaching time” for an online class. Shaky supervisory relationships tend to falter across distance, and we have learnt that managing the delicate balance between challenge and support is harder across space.

It has been possible to train people so that they are prepared for the process of knowledge creation, even when they continue to work and support family in less developed countries. The digital tools did not always work as expected, and in the end, the process worked because the students and faculty were resourceful and able to come up with solutions to technical and other problems along the way. PhD students are not the typical intended beneficiaries of a digitising economy in a developing country. It is hardly surprising that intellectually gifted and motivated people were able to overcome the technical challenges that stood in their way.

But it matters that the intellectual centre of gravity of a region is inside the region. A region where knowledge always comes “from elsewhere” is unlikely to develop. The evolution of digital tools and acceptance of digital practices had resulted in it being possible to – from inside Africa – train a growing cohort of scholars who are trying to make sense of business and management in Africa. There can be no doubt that in that instance, digital’s development potential was realised.

Digital Economy, Digital Enterprise

Surviving in the Digital Era – Business Models of Digital Enterprises in a Developing Economy

A new paper on Digital Business Models of Digital Enterprises in a Developing Economy has been published by the DIODE Ghana Team.

This study aims to explore the business models and strategies of digital enterprises in a developing economy context to understand the nature of their operations, as well as their survival tactics. A review of literature on digital enterprise models led to the adaptation of a 16 business model archetype for analyzing digital enterprises in Ghana. Using a critical realism perspective, survey data from a sample of 91 digital enterprises were used for the study.

The findings suggest that among human, physical and intangible assets, financial assets were the least used assets in the operations of the digital enterprises. This stems from the fact that the online financial business sector is still in its nascent stages in most developing economies. The findings further suggest that all digital enterprises leverage accessible and low-cost social networking services as part of their operations and use them as an avenue to engage with their target customers. The findings from this study provide guidelines to entrepreneurs who wish to venture into the digital ecosystem of Ghana, particularly with regard to the economic, financial and technological factors that enable digital enterprises to survive in the competitive digital economy.

 

The findings also suggest that it is important for governments to realize that there is an increasing rise in digital enterprises in the developing economies and these enterprises are creating jobs and providing business solutions locally that would hitherto be sought from developed economies. There is therefore the need for the requisite legal infrastructure and financial support that will cushion these enterprises from the fierce competitions that stagnate their growth.

The study provides a mapping of the digital business models of Ghanaian digital enterprises. This knowledge is arguably the first of its kind in the context of a developing economy. Hence, it serves as a stepping-stone for future studies to explore other areas in the digital economy, especially from a developing economy perspective.

Access Publication:

Eric AnsongRichard Boateng, (2019) “Surviving in the digital era – business models of digital enterprises in a developing economy”, Digital Policy, Regulation and Governancehttps://doi.org/10.1108/DPRG-08-2018-0046

Digital Economy

Questions about Digital Policies in Organizations

There are several types of IT/IS policies which govern the appropriate and acceptable use of information technologies in organizations. However, in the age of new digital business models and the upsurge of the digital economy, is there a need for specific policies to address the recent trends?

Questions we might need to ask include:

  • Is there any recent research on the digital policies in organizations?
  • What categories of policies will enable organizations to efficiently take advantage of opportunities in the digital economy? And how will these policies differ across industries/sectors?
  • What digital policies (micro, meso and macro-level) will enable organizations to positively impact on development needs in their communities and countries?

In effect, how do organizational policies catch up with the rapid growth and changes in the digital economy?

catch-up