System Dynamics Perspective for Digital Maturity

Abstract

The advancement of the level of Digital maturity at a national level fosters a burgeoning digital economy for a country. Digital maturity is a critical determinant of economic growth and societal development in the modern era. However, South Africa, just like any developing country, faces significant challenges in advancing its digital maturity, This explorative quantitative study applies Systems Dynamics (SD) modelling with the auspices of the DESI framework to assist policy/decision makers in understanding the dynamic and complex environment of digital maturity in South Africa's national context. By utilising system dynamics archetypes, the study uncovered recurring patterns of behaviour that affect digital maturity development in South Africa. The development of the novel system dynamics models through stock and flow diagrams of each of the four dimensions of DESI was a pronounced and critical outcome of the study. The simulation of the models allowed an exploration of best-case and worst-case scenarios, highlighting how policy interventions impact digital maturity over time. Based on the findings, it is recommended that policymakers and stakeholders prioritise sustained investment in digital infrastructure, particularly in broadband and 5G expansion, to ensure universal connectivity and affordability. The best- case scenario results demonstrate that high investment and low churn rates contribute to stable and accessible digital networks, fostering increased digital adoption. Additionally, boosting digital skills development through higher STEM enrollment, advanced digital training, and employment support for ICT professionals is crucial to building a digitally skilled workforce. This study highlights that reducing digital skills migration can further strengthen local expertise and innovation, reinforcing long-term digital transformation. The application of system dynamics to the digital maturity index, such as the DESI framework, is novel in the study. This approach provides a holistic and structured approach to understanding the complexity involved in the digital maturity of a iii country. Second, by modelling digital maturity using causal loop diagrams, the study contributes to the body of knowledge on how the components of digital maturity interact in a dynamic setting.