Stanford Social Innovation Review|June 27, 2014
By Sara Agarwal and Parag Khanna
Since the rise of mobile communications and the Internet, movements have emerged to leverage these technologies for economic growth, social equity, improved education and healthcare, and other public goods. Donor agencies, NGOs, companies, industry coalitions, and other players have clamored to launch initiatives that help countries bridge the “digital divide” or “leapfrog” to the latest—or next—technology standards.
But both the rapid pace of technological change and the cost of adopting new products have proven stumbling blocks. Emerging-market government spending on information and communications technology (ICT) is expected to reach $138 billion in 2014, yet many such investments (and many ICT-related projects undertaken by the World Bank and other donors) fail to result in tangible and cost-effective social benefits. Now a new generation of digital breakthroughs—cloud computing, big data, social computing, and 3D printing—holds the potential to deliver important social benefits, but only if we change how we practice technology adoption.
The advent of cloud computing offers a potential breakthrough in achieving high-quality IT services at far lower cost. In Albania, 14 separate ministries operated their own IT infrastructure, with more than 300 servers spread across dozens of locations and running a multitude of operating systems. This resulted in huge maintenance costs and variable service.
The shared services that cloud computing brings reduces government overhead and can empower entire populations. In the educational sector, for example, better online educational content provided through the cloud can address classic challenges such as large classroom sizes, minimal teacher training, and the lack of lab environments for hard-to-teach STEM topics.
Wherever humans interact digitally, it is possible to find useful insights. The streams of unstructured data (from real-time communications, and from postings on platforms such as Facebook and YouTube) comprise a vast set of data that we can use social computing to analyze. Google Flu Trends is a recent example of using social computing to anticipate public health crises, and pre-position food stocks and flu vaccines; Twitter feeds have provided early warning on food shortages and natural disasters.
More active and targeted use of digital tools and shared findings can also lead to progressive collaborations with significant impact. For example, in 2011, HP Labs made GLOE technology, which maps Web content to geographic locations so that mobile users can access location-based information, available to UNOSAT (the UN’s satellite applications program within its training and research bureau, UNITAR) and the Citizen Cyberscience Centre to support a volunteer-based mapping platform that helps monitor deforestation, assess damage from natural disasters, and identify sources of fresh water.
Big data goes beyond social computing to leverage large datasets and inter-relate them to find correlations that can help countries optimize policy and social welfare. The agricultural sector has already benefited tremendously from data correlations; for example, farmers around the world can now quantify harvests, correlate them to weather patterns and market demand, and maximize revenues. Transportation is another critical area. In Abidjan, the economic capital of the Ivory Coast, Orange Telecom launched a Data for Development program that used 15 million anonymized mobile phone call data-points to correlate commuting patterns to public transportation schedules. This resulted in the redrawing of the city’s major bus routes, reducing congestion and cutting commuting time.
One of the most exciting new areas of technological innovation that has profound implications for developing countries is 3D printing, which allows people to fabricate geometrically complex objects using 3D model data and material printing devices. 3D printed matter could be used to make everything from product prototypes to replacement parts for industrial appliances. Small-scale manufacturers and entrepreneurs can now produce items that would previously have required a much larger upfront investment and potentially climb the competitive value chain far more quickly.
Where to go from here?
Recent breakthroughs in low-cost, high-impact technologies can indeed bridge market failures in infrastructure provision, enable the more effective and equitable provision of education and healthcare, and create new business models to reach the poorest citizens. What then can we do to accelerate the adoption of these technologies across emerging societies?
The first area relates to procurement reform: How do governments buy and acquire ICT systems? If governments innovate their procurement processes to allow newer technologies in cloud computing and virtualization, they can save substantially on costs while getting better performance. Yet most public sector procurement systems across the globe do not encourage this kind of innovation.
One promising approach is Hewlett Packard’s eProcurement System, which uses a pay-per-use model that requires no upfront government investment. Countries like Ghana, which are keen to borrow money to implement e-procurement but have a problem of high indebtedness, could speed up the process by taking a similar route. Development organizations and aid agencies could easily promote the use of this type of innovation among the governments they support as a cost-effective solution to procure more quickly and transparently. Mainstreaming low-cost ICT provides another opportunity to spread the benefits of these new breakthroughs. The World Bank has launched an Open Development Technology Alliance to leverage the broad base of ICT knowledge residing in companies, governments, academia, and civil society, and to share insights with their national clients. With donor support, governments can set up “innovation officers” whose main duty is to spread innovative solutions across public services areas.
A third approach to spreading access to these low-cost technologies is skill building. The private sector can play a critical role in spurring the creation of more market-relevant educational modes. Cisco’s Networking Academies and the HP Institute are examples of such efforts, as are industry groups such as the Volunteers for Economic Growth Alliance.
Finally, we must address the challenge of financing innovative technology adoption through blended funding models that deliver both economic and social returns. For example, Microsoft’s 4Afrika Initiative involves investing in the rollout of lower-cost power generation and Internet access across the continent. Another novel approach is development impact bonds in which private entities (companies or foundations) invest in complex technologies aimed at broad social benefit, and collect financial returns from governments and donors when the results are demonstrated. On the whole, financing must increase and blend, while business models for selling to governments shrink to the pay-per-use level that characterizes the hugely successful “bottom of the pyramid” approach to supplying goods to low-income markets.
The hardware and software breakthroughs discussed here make it possible for developing countries to switch to a more modular and cost-effective strategy for leveraging technology for development. But implementing this spectrum of technologies in developing countries will also require the collaboration of multiple actors—public and private, domestic and foreign. Yet if all stakeholders in the ICT for development (ICT4D) focus on cost-effective and upgradeable technology systems with long-term financial models, then developing countries will indeed catch up and keep pace with global technology standards.