Data Is Not the New Oil: It’s the New Compass for Africa’s Innovation Economy

For years, the phrase “data is the new oil” has echoed across conferences, pitch decks, and tech strategy sessions. It sounds powerful, a metaphor for value, potential, and transformation. But it is also misleading. Oil is a finite resource burned for energy and profit. It is extractive, polluting, and controlled by the few. Data, by contrast, is regenerative, inclusive, and directional. For Africa’s innovation economy, data should not be seen as a commodity to exploit. It should be embraced as a compass, one that helps navigate complex markets, build smarter products, and create long-term impact.

In today’s digital landscape, particularly across African markets, data has become one of the most critical assets an organization can develop. From fintech to logistics, education to e-commerce, data offers the opportunity to do more than just track performance. It can shape decision-making, reveal user behavior, and highlight gaps that traditional business models overlook. Companies that understand this are not only more adaptive, they are more effective.

Instead of chasing vanity metrics or post-launch analytics, data should be embedded from the start. It should guide product design, operational models, customer engagement, and growth strategy. Take logistics, for instance. Real-time route optimization informed by traffic and delivery data can reduce fuel costs, improve turnaround time, and elevate customer satisfaction. In finance, understanding how users save, borrow, and spend can help design more inclusive services for underbanked populations.

This clarity only comes when data is treated as a guide, not an afterthought. Unfortunately, many businesses still see data as a reporting task rather than a strategic asset. They collect it but fail to interpret or act on it. They invest in dashboards but ignore the deeper stories the numbers are telling. This limits innovation and wastes valuable insights.

Equally important is access. Data-driven innovation thrives in ecosystems that democratize knowledge. That means investing in tools that are usable in low-bandwidth environments, promoting open data initiatives, and supporting data literacy from the boardroom to the frontlines. It is not just about hiring analysts. It is about building a culture where asking the right questions is as important as having the right tools.

Contrary to the oil analogy, data should not be hoarded. Its true value emerges when it is shared, contextualised, and translated into better outcomes for real people. That is the kind of progress Africa’s innovation economy needs, solutions that are locally informed, globally competitive, and socially relevant.
And as of September 2024, the smartest innovators across the continent are already using it to navigate forward.

Africa does not need another boom-and-bust cycle. It needs intelligent, inclusive growth. That growth will not be powered by extraction but by direction. Data is not the fuel driving innovation. It is the compass that ensures innovation moves with purpose.
Joshua Aaron is a Senior Data Analyst specializing in data-driven product development and innovation. With academic grounding in Data Analytics and Technologies, he has contributed to fintech advancements at Websphere Solutions and helped build tools like Kobotrack, serving users across Nigeria and beyond.

Aaron Joshua
Senior Data Analyst
Writes