From Start-Ups to Digital Darwinism: Algeria’s Views on Innovation
Start-ups may not dominate the economy in Algeria, but nearly three-quarters of surveyed business executives in the country said the start-up ethos offers the ideal model for creating a culture of innovation – regardless of a company’s size.
It’s no wonder the start-up model is revered, given that 75% of Algerian executives expressed apprehension regarding “Digital Technology Darwinism” – the fear that their company could become obsolete as technology evolves faster than they can adapt.
The fifth-annual GE Global Innovation Barometer also found that half of Algerians surveyed said their companies have an innovation policy in place, compared with 68% of companies globally and 88% in France, the country with the highest response. In Algeria, 60% say they are looking to drive incremental innovation with that policy. Eighty percent said their innovation policy seeks to harness existing skills and resources within the company, while 60% percent identified improving existing solutions and products as an innovation goal.
Innovation in Algeria is being driven by multinationals, local SMEs, and local universities and research institutions, according to the 97 Algerian respondents, who came from the manufacturing, industrial, healthcare and energy sectors, and both the public and private sectors. They were among 2,750 business leaders surveyed across 23 countries in this year’s study.
Challenges to innovation
Algerian businesses face a number of obstacles to innovating more efficiently. These include the ability to acquire and integrate external innovation within the company (mentioned by 62% of respondents); difficulty identifying effective business models to encourage new ideas (mentioned by 60%, up from 48% in 2014 and compared with 36% globally), and lack of sufficient investment funds and financing options (53%, compared to 50% globally). Algerian organizations’ inability to take risks was cited as a constraint by half of respondents. Only 38% of respondents said difficulty coming up with “radical and disruptive ideas” was a challenge to innovation. That’s way down from 51% in 2014.
Impact of current disruptions on business
While 78% of the Algerians interviewed were optimistic about the transformation of industry that would come as a result of advanced equipment and evolving production processes, only 62% thought the digital revolution would positively impact employment, lower than the 83% who feel this way globally.
Although the digitalization and the automation of the economy are set to radically change the labor market, Algerian executives are very optimistic (84%) about the impact of this new era. Respondents believe this “Fourth Industrial Revolution” will improve work safety (mentioned by 61% of Algerian respondents, compared with 43% globally); enable employees to take on new jobs with greater value-add (58%, compared with 48% globally); create new jobs and increase demand for some job categories (72%, compared with 53% globally); and increase the “mobile worker” or “teleworker” phenomenon (43%, compared with 71% globally).
The survey took a special look at innovation in the energy sector, where it found that Algeria’s respondents were the most optimistic globally regarding how significantly innovation could impact the energy sector. Eighty percent of respondents anticipate innovation will drive improvements to energy efficiency and energy distribution, 69% saw impacts to energy consumption, 47% saw effects on the country’s carbon footprint and 43% thought it would impact energy costs.
GE supports innovation across the region through a wide range of activities, including developing patented technologies in Saudi Arabia, building innovation centers that nurture collaborative thinking and new region-focused approaches, launching innovation challenges that address issues with specific relevance to MENAT, and working with customers to overcome their unique challenges.