With the advent of the internet and digital revolution, business models and workplace dynamics are being changed by digital literacy. It determines how work is performed and managed, and the kind of skill needed in the workplace. It is also rapidly changing the expectations that people (employees and clients) have of business owners’ traditional leadership skills and business models, which are no longer sufficient to engineer market-leading innovations and bring satisfactory entrepreneurial returns. The digital economy is expanding across the globe, though at an uneven rate in different countries. Nonetheless, in most countries, it is constantly being developed and efforts are being made to migrate traditional business models to the digital economy as much as it can accommodate.
According to a 2016 report by the Oxford Economics, the global digital economy is valued at $11.5 trillion or approximately 16% of the global economy. The global digital economy is also estimated to account for a quarter (25%) of the global economy in the next ten years. While Nigeria does not currently have a large share of the global digital economy, effort is being made to position the country to contribute immensely to the economy. The World Economic Forum (WEF) predicts that over 60% of global gross domestic product (GDP) will be digitized by 2022 and that in the next ten years, digital platforms will be used to create over 70% of new value. Also, according to a report by Ericsson titled, “How Important Are Mobile Broadband Networks for Global Economic Development,” a 10% increase in mobile broadband penetration results in approximately 0.6% to 2.8% rise in GDP.
The digital economy is the way technology has revolutionized information.
We presently live in an information age, where people must manage more information, Google has an overload of information on practically any subject one can think of. The processing of this information requires technological support, which in turn demands and creates more information. These developments have affected everyone’s life. We use digital devices, such as smartphones, digital cameras, and especially computers. Computers are used for almost every aspect of life, such as in banking, mass media, publishing, communications, music production, photography, marketing, film making, etc.
Digital skill (or digital literacy) is a set of skills that enables an individual to operate effectively in information processing and usage in a technology-oriented environment. Digital literacy is critical for a nation’s workforce in today’s digital world. According to UNESCO (2011), digital literacy is defined as the ability to access, use, and disseminate information in the digital age. It is about understanding information which is presented in different formats, and figuring how to use it in secure and productive ways. For example, digital technology can be used to sell goods or offer services (e.g., e-commerce, mobile and computer apps), manage finances and employees, source materials, and market businesses online for entrepreneurial yields, which are the returns or benefits derived by business owners as a result of investing their time, money, and education into their business. These benefits could be measured in terms of more customers, expansion, and more profit.
Businesses have adopted digital literacy in developed countries.
Research has shown that both large and small businesses in developed countries have successfully adopted digital literacy or skills to have a competitive edge, transform business models, and improve their relationship with customers and suppliers. These skills are essential factors for many successful small business owners (SBOs). However, digital literacy continues to be one of the challenges faced by developing countries, one of which is Nigeria. The Minister of Communications and Digital Economy, Mallam Isa Pantami, emphasized the significance of digital literacy to the successful implementation of Nigeria’s digital economy at the one-day virtual workshop organized by the Nigerian Software Testing Qualifications Board (NGSTQB), with the theme, “Role of Software Testing in Nigeria’s Digital Economy.”
The minister noted that for Nigeria to achieve its target of 95% digital literacy level by 2030, “we will need to build the literacy of citizens in order for them to understand and consume digital services.” Numerous studies have been conducted on SBOs, and most findings maintained that despite their significant importance and contribution to economic growth, SBOs around the world—particularly in Nigeria—are faced with numerous challenges that inhibit entrepreneurial growth. These challenges include: lack of funds, low entrepreneurial and managerial capabilities, poor and unreliable infrastructure, harsh business environment, poor service delivery, and lack of access to modern technology.
Agencies were created to stimulate the development of small businesses.
Despite the efforts of the government in creating small business development agencies in Nigeria, small businesses continue to face challenges that threaten their survival. However, several interventions have been launched in Africa (particularly in Nigeria) to assist entrepreneurs to grow sustainable businesses and help them become more digitally literate. These agencies include the Small and Medium Enterprises Development Agency (SMEDAN), the National Directorate of Employment (NDE), Peoples Bank of Nigeria (PBN), Microfinance banks, National Economic Reconstruction Fund (NERFUND), and National Bank of Commerce and Industry.