By Hendrik Kotze, Chief Information Officer at the JSE
Charles Darwin once said “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.” An old adage that rings true in 2020 as the world agonises over the devastating effects of Covid-19 on business, finance and global markets.
Every sector of business has had to count the cost and gear towards adjusting their businesses model to weather the storm. The financial sector is no exception being one of the essential services and arguably forming part of the backbone of the economy. Dealing with market volatility and uncertainty over the global economy and how they filter into the capital markets, the Johannesburg Stock Exchange has had to activate business continuity plans.
In the midst of uncertainty about what is to come, one thing is clear: the future is digital. Leveraging technology during this pandemic is vital to the survival of any organisation. It is not only necessary but inevitable. In the age of quarantining and social distancing, technology provides the opportunity to differentiate your offering from the rest of the pack. Organisations that view these technologies as critical will be able to drive faster business transformation while also creating advantages for themselves during this time.
The JSE, in particular, is no stranger to technology. With over 125 years of trading history under our belt, we have evolved from a traditional floor-based equities trading market to a modern securities exchange providing fully electronic trading, clearing and settlement in equities, financial, interest rate and commodity derivatives and bonds, as well as FX products.
In line with this, the JSE recently hosted the first fully remote and web-based shareholder meeting of its kind in South Africa. This was in partnership with The Meeting Specialist (TMS) to launch the first virtual AGMs in our country to ensure shareholder engagement through the lockdown. While virtual meetings will in due course become widely accepted, or at least become a routine adjunct to conventional meetings, the immediate availability of this service is particularly relevant in today's volatile economic climate. It also serves as testament to the importance of swiftly adjusting or adapting to the environment we currently find ourselves in.
This new normal also includes remote working, which for us commenced in 2019, with a move to Office 365 and Microsoft Teams. Little did we know that in 2020, this move would be vastly beneficial - a process with many moving parts - when the entire organisation would be forced to move off-site for the lockdown period.
We provided employees with secure laptops and automated operational practices and procedures overnight through collaboration on Teams with traceable and auditable conversations to ensure appropriate governance and oversight were maintained. We also upgraded networks and access infrastructures on short notice, including data packages to minimise top-up disruptions. Volumes escalated beyond what was foreseen in the normal capacity forecasts and in certain cases, additional processing capability had to be sourced on short notice. Our employees responded positively to the changes and are to be commended for how they stepped up to ensure smooth and continued operation of South African Capital Markets. Accolades are also in order for JSE partners and suppliers that assisted in facilitating a smooth transitioning to the remote working model. This level of collaboration and swift action has helped the JSE achieve business continuity and ensure that Africa’s largest stock exchange remains a resounding success.
However, I believe that there is still room to leverage more digital tools and platforms to further ensure that the stock exchange runs seamlessly. The same applies for businesses in South Africa. Now is the time to tap into new and exciting technologies that can further unlock the digital economy and assist businesses in distress. We have seen a shining example in China’s use of the internet of things, 5G communications, artificial intelligence and big data to fight against the outbreak. This innovation assisted various sectors including healthcare, education and logistics and most importantly, saved lives.
Similarly, the use of digital infrastructure can empower the South African economy to integrate the digital world with the physical. Globally, we are already seeing that the digital economy has completely changed the traditional economic ecosystem that has existed for centuries. We can no longer be thinking of digital technologies as add-ons but rather as an integral part of our products and services. However, fully integrating these technologies requires sufficient and widespread access to mobile technology. While this is not a reality yet, a recent Geopoll survey indicates that approximately 51% of South African adults have a smartphone and 40% have a basic feature phone. We are well on our way to using innovation to deliver healthcare and education services via phone – another business and employment opportunity that can be leveraged.
South Africa has the capacity to harness digital technologies to accelerate digital transformation. The way we do business has drastically changed and only the companies that adapt to these changes will succeed during Covid-19 and beyond. Indeed, by embracing digital transformation, businesses can maintain their ability to ensure essential functions during and after the pandemic. Dare I say it… it is time to adapt or be left behind for good.