Business Model Reinvention

The 28th Annual Global CEO Survey – Sub-Saharan Africa perspective reveals a paradox in the region: while economic volatility is a concern, there is a growing sense of optimism among business leaders. This shift indicates transformation in how CEOs approach long-term strategies, viewing uncertainty as a catalyst for reinvention. Rather than holding on to traditional business models, leaders are embracing change and exploring new ways to drive growth and profitability. 

This new way of thinking is spurred on by Business Model Reinvention, a process of fundamentally changing the way a company creates, delivers and captures value. This involves rethinking and redesigning core aspects of the business, such as its value proposition, revenue streams, customer segments and operational processes, to adapt to changing market conditions and emerging opportunities.

Businesses in Sub-Saharan Africa are undergoing a transformation, driven by demographic changes, technological advancement and the rise of entrepreneurial leadership. To reduce reliance on traditional commodity exports, business leaders are embracing strategic diversification, focusing on sectors such as technology, finance and renewable energy, enhancing profitability and global competitiveness. Investment in the region is rising, with significant deals in the energy and mining sectors, driving economic growth and development.

It erodes consumer spending power, leading to reduced demand for products and services. Businesses face higher costs for raw materials, labour and other operational expenses, squeezing profit margins and complicating strategic planning. The uncertainty surrounding inflation makes financial forecasting and investment decisions difficult, diverting focus from innovation and long-term growth. 

Macroeconomic volatility is another major concern, with 30% of CEOs feeling highly exposed. Global economic shifts, political instability, and changes in commodity prices create an unpredictable environment. This volatility impacts consumer confidence and supply chain stability, making it challenging for businesses to implement long-term strategic plans.

These megatrends manifest differently across various regions, each facing unique challenges that shape their economic landscapes.

• West Africa: High inflation and currency volatility, especially in Nigeria, impact cross-border trade and investment. 
• Southern Africa: Low availability of skilled labour hampers growth. 
• East Africa: Cyber risks and geopolitical conflicts threaten stability. 

Despite facing numerous threats, Sub-Saharan Africa CEOs demonstrate remarkable optimism about the future.

This confidence exceeds the global average of 55%, with Southern Africa CEOs showing the highest optimism at 67%, followed by Eastern and Western regions at 59% each.

This optimism is rooted in strategic business transformation efforts to explore future opportunities and address challenges. Political transitions and policy reforms across Southern Africa, including South Africa's Government of National Unity, have created a compelling environment for business growth, contributing to positive sentiment about the region's economic trajectory.

Next steps for CEOs

To successfully transition from disruption to reinvention, Sub-Saharan Africa CEOs should:

• Create unique advantage by optimising operations and enhancing financial performance through effective cost management and revenue generation strategies tailored to regional strengths.
• Invest in innovation and scalability through:
  • Diversify business models by exploring high-potential sectors and balancing domestic market strength with international expansion.
  • Focusing on new products/services, new customer bases and advanced technologies.
• Shift to dynamic resource allocation models to swiftly direct financial and human resources to high-priority projects.
• Effective workforce management by balancing workforce stability with technological advancement to enhance productivity while addressing the skills gaps.
• Implement data-driven strategic decision-making that balances analytical thinking with strategic imagination.
• Foster organisational agility and adaptability to navigate complex market conditions
• Promote collaboration with other organisations and leveraging government initiatives to further support growth and innovation.

Sub-Saharan Africa exemplifies strategic thinking and adaptive capabilities. CEOs are making bold changes, integrating new technologies, exploring diverse sectors and maintaining operational strengths. This region's transformation highlights the importance of flexibility, strategic foresight and a balanced approach to innovation. 

Key insights:

• Flexibility and strategic foresight: Future business success in Sub-Saharan Africa will depend on adaptability and strategic planning. 
• Balanced innovation: Companies must balance innovation with maintaining core operations. 
• Sustainable growth: Thoughtful transformation can unlock new pathways to growth and resilience. 

How PwC can help:

Using PwC’s Business Model Reinvention framework, we collaborate closely with organisational leaders to map out a plan that drives towards value creation and growth.

Our focus is to use our human-led, tech-powered capabilities to address opportunities to help your organisation reinvent your business model and radically transform how you create, deliver and capture value.  

PwC guides businesses through reinvention with a comprehensive approach focusing on four key stages: 

PwC creates impact across the entire landscape of your Business Model Reinvention. From tax and deals to risk and regulation, PwC has the broad capabilities to help clients deliver every part of their business strategy.