May 2018 • AFRICA EDITION
UGANDA BREWERIES
DRIVING CHANGE IN UGANDA THROUGH LOCAL PROCUREMENT
J O S H U A M U W E M A , H E A D O F P R O C U R E M E N T AT U G A N D A B R E W E R I E S , O N T H E C O M PA N Y ’S D E S I R E TO E N G A G E L O C A L C O M M U N I T I E S
EXCLUSIVE
ACCENTURE CHANGING AFRICA’S MINING LANDSCAPE
TOP 10
COMMERCIAL BUILDINGS IN AFRICA
CITY FOCUS
RABAT
FOREWORD HELLO AND WELCOME to the May issue of Business Chief’s Africa edition. Our cover story this month is an in-depth, exclusive interview with Head of Procurement at Uganda Breweries, Joshua Muwema, who discusses how the company’s localised sourcing strategy is helping to give back to communities in the country. A global company with a local focus is Accenture. Nishal Nair, MD of Accenture Africa, discusses the ways in which the business is applying advanced technology to ensure that mining remains a profitable industry for the continent. This month’s global technology transformation section looks at electric vehicles – is the correct infrastructure in place to provide for the masses of energy they will consume at any given time? Skeleton Technologies CEO Taavi Madiberk discusses what needs to be done to prepare for a new era of transport. We also found out about the US skills gap from Jack Coker at Ducatus Partners, and looked into whether it is a global phenomenon. How might it be resolved? Moving on to sustainability, branding expert Allen Adamson advises us how to maintain a strong brand identity while diversifying a company’s product range. This issue’s City Focus explores the Moroccan capital Rabat, while our top 10 scours the largest commercial buildings to be found in Africa. Finally, be sure to read our other exclusive interviews, featuring ECOM Trading and Pizza Hut.
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8 PROCURING LOCALLY AND SUSTAINABLY TO DRIVE CHANGE IN UGANDA TECHNOLOGY
Wider electric vehicle adoption requires global energy solutions
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Accenture
Changing Africa’s mining landscape
L E A D E R S H I P & S T R AT E G Y PEOPLE
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IS THE US SKILLS SHORTAGE PART OF A GLOBAL EPIDEMIC?
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CITY FOCUS
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TOP 10
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Top 10 commercial buildings in Africa
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share happiness
Uganda Breweries Food & Drink
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C O M PA N Y P R O F I L ES
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ECOM Trading Supply Chain
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Yum! (PizzaHut) Food & Drink
PROCURING LOCALLY AND SUSTAINABLY TO DRIVE CHANGE IN UGANDA Written by Catherine Sturman Produced by Justin Brand
A farmer in his sorghum garden in eastern Uganda donning a senator branded T-shirt. Senator is a sorghum based beer
Head of Procurement at Uganda Breweries, Joshua Muwema, on the company’s work to give back to local communities
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onsuming up to 10 litres of alcohol per person per annum, Uganda has become a country of significant growth for the adult beverage industry. Each year, up to a million Ugandans reach legal purchase age, fueling a market full of untapped potential for new and developing businesses. Focused on delivering highquality products, from international brands such as Guinness and Tusker to popular local products Bell Lager, Uganda Waragi, Senator, Ngule and much more, Uganda Breweries Limited (UBL) strives to tap into the tastes and demands of its consumers. The company seeks to become
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one of the best performing, respected and, more importantly, most trusted consumer goods company in Uganda. “Whilst spirits continue to grow, the informal beer sector represents 60% of alcohol consumption in Uganda. There’s a huge opportunity for us to recruit consumers into our product segments,” explains Joshua Muwema, Head of Procurement. Local raw materials agenda In spearheading the implementation of sustainable, domestic value creation across UBL’s supply chain, UBL has sought to transform its business through placing increased emphasis on procuring raw materials from local communities to improve
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“WE’VE SEEN A LOT OF GROWTH ON THE SPIRITS SIDE OF THE BUSINESS AND ARE INVESTING WHERE WE SEE A FUTURE” - Joshua Muwema, Head of Procurement africa.businesschief.com
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OFFERING BETTER SERVICES THAN EVER BEFORE
Savannah Commodities is an agricultural commodities trading company mainly dealing in coffee and grains. We are one of the most reliable suppliers of quality Ugandan coffees. We are currently expanding our processing, silo storage & value addition infrastructure to avail to the farmersĘź grain & pulse handling throughout the year. Savannah has chosen to go green and has installed high energy efďŹ cient agro processing, handling & storage complex driven by motors & drier systems. Vision: To provide Agro processing infrastructure, agro value addition & Soft commodities trading solutions company in East Africa. Mission: One Stop for value addition on agro-products where the agrocommodities are exported or traded to other manufacturing industries.
www.savannah.co.ug savannah@infocom.co.ug | Tel: +256 (41) 4252 541 | Fax: +256 (41) 4252 542 Plot 6/8 Nyondo Close, Industrial Area Bugolobi, P.O Box 6217 Kampala, Uganda
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the lives of Ugandan citizens. Through UBL’s local raw materials sourcing agenda (LRM), the company has sought to nurture partnerships with local suppliers and farmers. UBL provides farmers with the necessary seeds to grow the grain for its processes and educates them on how to achieve the right quality and subsequently provide the market once the crop is harvested. This remains an area of immense pride for Muwema, and in 2015 the company reached a total of approximately 17,000 farmers under its LRM agenda, benefiting over 25,000 households countrywide. ‘Our collaboration with Kakira Sugar (part of The Madhvani Group), for example, has enhanced our ability to avail our consumers with affordable quality beverages resulting from a tax benefit from the government,’’ explains Muwema. UBL’s decision to also appoint Savannah Commodities as a single aggregator for sourcing its local raw materials is projected to bring immense benefits to both company and farmers. The farmers have a
UGANDA HAS BECOME A COUNTRY OF SIGNIFICANT GROWTH FOR THE ADULT BEVERAGE INDUSTRY
UBL PLANS TO INVEST IN ITS BEER PACKAGING AND STORAGE CAPACITY TO INCREASE PRODUCTION BY 50%
UBL’S WORK WITH SAVANNAH COMMODITIES AND LOCAL FARMERS HAS ENHANCED THE LIVELIHOODS OF LOCAL COMMUNITIES
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one stop centre where all produce is received, processed and stored hence guaranteeing quality. The agro processing facility sits beside a fertiliser blending plant that provides cheap affordable fertiliser to the farmers hence boosting productivity on their land. “With Savannah being our partner in extension delivery, we have seen more demo farms established while an opportunity arose out of this marriage for us to expand barley growing areas to the south western frontier of Kigezi region which adds to the communities that benefit from working with UBL,” comments Muwema. As the business thrives, its engagement with the communities doesn’t stop at commercial activity only, where UBL continually engages in impactful corporate social responsibility activities. Whilst many communities in Uganda lack access to clean water, UBL’s Water for Life Programme has worked to deliver essential access to clean water facilities, improved sanitation levels and provided a
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significant long-term impact. Additionally, UBL’s involvement in environment conservation has seen its staff undertake the E Green Initiative to contribute to the restoration of Uganda’s forest cover through tree planting. Most recently, UBL, in partnership with National Forestry Authority (NFA) and Wild Wide Fund (WWF), restored 109 hectares of forest cover to the Navugulu Forest Reserve, allowing for the forest to serve its purpose as a catchment for Lake Victoria thus contributing to less pollution upstream. Driving productivity Throughout its ambitious fiveyear plan, UBL has witnessed a significant improvement in the rollout of various Capex projects as its brewery continues to expand. “Productivity is an engine for growth for us because, for every penny that we save, we look at how much we can plough back into the business,” says Muwema. “We are currently installing a stateof-the-art bottling line at the distillery.
UBL E-green team @ Navugulu Forest where they restored 109 hectares of degenerated forest cover UBL board launching Ugx 800 million scholarship fund and Water projects for 2018 in northern Uganda farming communities.
DHL SUPPLY CHAIN INTERNATIONAL LTD What DHL offers :
• Outbound Warehousing - Beer and spirits • Inbound Warehousing • Warehouse management solution and inventory management Aila Aliongo Director: Business Development E-mail: Aila.Aliongo@dhl.com
www.dhl.com/logistics
• In plant logistics Line feeding and evacuation • Inventory Management • VAS (Sortation and Conversion of new glass bottles from cartons to cases) • Distribution of beer and Spirits to Customer
distributors countrywide • Reverse Logistics ( Empty glass and returns) • Site Health and Safety Management • A multi-skilled and flexible workforce to accommodate peaks of activity
Zachary Mukwaya - Head of Business, Uganda E-mail:Zachary.Mukwaya@dhl.com +256 772 671 592
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UBL Management Team i.e MD, SCD & HOP visiting the Savannah processing & storage facility in Mukono
This line is fully automated and will be deployed along with associated utilities and civil works which include a brand-new warehouse and other amenities. This will be launched in June this year and will help us roll out products that will meet ever growing customer demands. “We’ve seen a lot of growth on the spirits side of the business and are now investing where we see a future,” he adds. “On the beer side of the business,
we have currently maxed out the production capacity of 1.2mn h/ litres. The limiting factor being the packaging line and storage. “Our plan is to invest in packaging and storage capacity to increase production by 50%. This is a work in progress and is planned for the next financial year.” To further support its ongoing expansion, UBL has developed strategic partnerships with logistics suppliers to drive efficiencies while
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bringing down cost. “Efficiencies in transport, inventory management and warehousing are key in maintaining positive COGS which in turn drives the product pricing to an affordable price point for the consumer,” says Muwema. Partnering with DHL East Africa has seen UBL outsource its distribution, inventory management and warehousing operations, thus unlocking increased value and ensuring the products are at the right place, the right time and at the right price. “DHL shares in our vision and in 2018 has embarked on an expansion program at its Luzira warehouse facilities in order to meet UBL’s growing warehouse capacity demands. Additionally, DHL is aggressively looking at their existing fleet with a plan to refresh and expand the existing fleet and forklifts as well, to improve efficiency and manage UBL’s increased production volumes,” Muwema says. “We did something similar with Mansons, who is also a major transporter but on longer routes.
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We have structured a performance contract with them that gives us more, without necessarily driving up costs. Within this 3PL contract, we have included bonus malice clause, wherein we discuss gain share opportunities. “All of this helps us to run the business efficiently and drive down costs which in turn allows us to price our products competitively to the consumer,” he continues. “Nonetheless, we continue to face challenges in sourcing especially when dealing with importation of raw materials through trade barriers which include import levies and cross border charges, longer lead times and foreign exchange disruptions. “By sourcing materials locally, UBL has therefore worked to reduce and mitigate such barriers to trade, importation and transit times, whilst improving the planning of materials which are sourced from overseas.” Inspiring others Housing a number of category managers across its procurement team, in areas such as agri-business,
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“PRODUCTIVITY IS AN ENGINE FOR GROWTH FOR US BECAUSE, FOR EVERY PENNY THAT WE SAVE, WE LOOK AT HOW MUCH WE CAN PLOUGH BACK INTO THE BUSINESS” - Joshua Muwema, Head of Procurement
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EXPEDITED SOLUTIONS FOR OUR CUSTOMERS Expediters International Ltd was established in 1984 primarily as a sourcing and procurement company, to support the various regional refugee efforts. Through deliveries of essential supplies, vehicles and distribution of large volumes of food aid in Sudan, Uganda, Ethiopia and Rwanda, the ethos of the company developed to offer multimodal logistics solutions that provide a competitive and reliable market edge to local manufactures to export their products. The company has continue to grow on this platform of service integrity and hands on management to offer their clientele an increasingly viable export option.
info@expediters.co.ke Tel: +253 722206353 | +253 733699001
Quality & Freshness Uncompromising CAPACITY 350,000 bottles a day; 3 IS bottle making machines; Inspection machines on line; An updated quality and analytical lab CUSTOMERS We service the top spirit packers and distillers in Kenya/Uganda and Tanzania and we are authorized and approved by major multinationals, in Food / Beverages and Spirit Segments to produce bottles for them, we produce Jars / Beverages / Water bottles. SERVICE We own a logistics fleet to ensure clients get bottles in shortest possible time DESIGN We have an in-house design team to ensure the client gets the bottle as per his type. We also have 3D printing and design facility.
www.millyglass.com gm@millyglass.com | sales2@millyglass.com +254 41 2224401/2/4 | +254 41 222 2449
An ISO 9001 and FSSC 22000 certified company
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raw materials and packaging, indirects, demand, and capex/ MRO, Muwema’s passion for seeing his team thrive is clearly illustrated throughout our conversation. By growing the fundamental structure of UBL’s nine-person strong procurement team through rotation, the team has gained a diverse skill sets and raised morale across the division. “If we are to be the best performing and most trusted company in the country, we should be investing in our people,” explains Muwema. “We inspire through purpose,” he adds enthusiastically. “What we’ve really brought to the table is integrity, which is something that the company takes pride in. I think my love for people and mentoring has also rubbed off on my team members, colleagues and peers, so it is something that I’m really proud of.”
So, what does the future then hold for Uganda Breweries? With future investment in large infrastructure projects in Uganda, such as dams for electricity generation, the country will continue to witness a boost in economic growth and industrialisation. The country will also undergo oil exploration in 2022, which Muwema notes, “will further change the landscape”. “The future is bright for us,” Muwema confidently concludes. “I see us remaining a major player in the market because we are a very dynamic company. Year on year we’ve put the right plans in place and take advantage of opportunities which arise. We also have a great portfolio of products as we keep innovating. “There is a bright future for the country and for the business as we remain a major player in the market.”
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Accenture
Changing Africa’s mining landscape
Nishal Nair, MD of Accenture Africa, discusses the ways in which the business is applying advanced technology to ensure that mining remains a sunrise industry Writ ten by N E LL WA LK E R
ACCENTURE IS A name synonymous with innovation. In the company’s own words, ‘today’s magic is tomorrow’s technology’, and this is a business which ensures that this holds true with its constant ground-breaking R&D operations. It is also a business which sees great potential in oft-overlooked nations; Nishal Nair is Managing Director of Accenture Africa with a specialisation in mining, and is keeping a close eye on the way advanced technology is affecting a continent on the rise. Nair is an electrical engineer and started out working in the resource sector, involving himself in the worlds of mining, petrochem, and downstream chemicals. As his career progressed from engineering to managerial roles, his path increasingly crossed with Accenture until he
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was working alongside the business extensively. Eventually he joined the organisation and has been with the company for over 10 years. Being heavily involved in the mining segment of the business with an extensive background in the resources sector, Nair is perfectly positioned for his role and the constant evolutions occurring within Accenture and the industry. “There are two parts to my role – mining and technology,” Nair explains, going on to discuss the latter. “You can see over time how technology has evolved. In the early days of industry, mechanisation was the big thing, powered by steam, and later electrical energy. After that we started to move into the electronic age, where
L E A D E R S H I P & S T R AT E G Y
“There are a multitude of technologies evolving and they are becoming cheaper and more efficient” – Nishal Nair, Managing Director, Accenture Africa
computers became prevalent in the daily life of the average person. There are a multitude of technologies evolving and they are becoming cheaper and more efficient, with better processing performance – consistent with the observations made by the well-known Gordon Moore now widely termed as ‘Moore’s Law’.”
So how does this apply specifically to Nair’s mining responsibilities? “What we’ve seen from the technology landscape is the combination of evolving technologies, and we’ve reached an amalgamation point where different technologies could be applied to various sectors. If you look at where technology is heading now, you’ve got – by virtue of us having faster, more efficient, and high-capability processing power – a whole lot of available avenues which were previously constrained by the ability to process and communicate.” Nair believes that endless possibilities have been opened up because technology is, quite simply, allowed to blossom now. What that does is add new dimensions to traditional asset-intensive industries such as mining which enable them to unlock trapped value in their business and operations. Under the broad banner of Industry 4.0 businesses are striving to become increasingly automated, allowing the asset-intensive industry to reinvent itself. “There are a several technologies available 27
L E A D E R S H I P & S T R AT E G Y now such as machine learning, artificial intelligence and blockchain, and companies want to know how to adopt them,” Nair states. “That is where Accenture starts to play a bigger role. We are looking beyond Industry 4.0 – we are taking Industry 4.0 efficiencies and adding smart, connected, living and learning experiences to unlock value.” It makes sense to Nair, who is aware of how resource-rich Africa is, to make the collection of resources simpler and more streamlined using the advanced technology at Accenture’s disposal. A decline in commodity prices, rises
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“The next tier is always more exciting and you have to be proactive” – Nishal Nair, Managing Director, Accenture Africa
in input costs, and political instability has meant that mining companies in South Africa specifically have had to rethink their position within the country and have been reluctant to spend and invest. As the mining sector is turning a corner, it is becoming increasingly apparent that technology is the avenue to bring value. “If you look at where technology is now, these technologies can be applied across the mine value chain to deliver higher efficiencies and productivity, by virtue of providing the operators and management with information that at one point was not accessible,” explains Nair. “You had to wait days for it, if not weeks, but now that information becomes so much more readily available that value-based decisions can be made quicker.” Businesses in Africa are rapidly adopting technology, and Accenture’s Industry X.0 is at the centre of it all.
The focus right now is the ability to access technology, so the question for innovation-heavy businesses like Accenture is: how do you use technology to unlock value? This is the challenge for Nair. Accenture is a solutions-based business, so its priority for Africa and for the mining industry is on connecting disconnected processes and making them intelligent. With the technology now available, Nair and his team are able to place segmented information into common platforms and create something agile and responsive. “If you look at an average person today with access to a smartphone, all of their apps and information are instant,” says Nair. “There’s an expectation that technology needs to be much quicker and deliver value faster, so the approach which we take to develop the solution needs to be very agile, very quick, and very adaptable. It’s about rapidly turning 29
“Don’t wait until the last minute to start adopting” – Nishal Nair, Managing Director, Accenture Africa
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L E A D E R S H I P & S T R AT E G Y initial requirements into prototypes and initial solution and then tweaking those solutions to what is right for the business and operations.” While there are challenges involved in the digitalisation of mining in an ever-developing nation, Nair believes technology is mature enough to be a key enabler, even in industries unused to digital. He thinks that businesses must provide a vision of what digital means for them, and that is what enables Accenture to lend its expertise and create a solution. The mining companies in South Africa are global players, meaning that they do have some access and understanding of the technologies available, but actual adoption requires additional assistance from R&D experts. “The approach we’re looking at with our clients is: there are technologies that have been tried and tested – can we apply them now and create quick value?” says Nair. “It’s also about momentum and establishing the foundation. The next step is planning for the next tier of value while dreaming about the art of the impossible. “The next tier is always more exciting and you have to be proactive. Don’t wait until the last minute to start adopting; we often think of Africa as lagging behind with technology, but technology has a fundamental place in the business and community of South Africa. We need to be more broad-minded and aware that technology provides a lot more value to the present South Africa and Africa as a whole in getting more access and participation in the economy.” 31
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TECHNOLOGY
Wider electric vehicle adoption requires global energy solutions WITH COUNTRIES THE WORLD OVER INCREASINGLY TURNING TO ELECTRIC VEHICLES, TAAVI MADIBERK, CEO AND CO-FOUNDER OF SKELETON TECHNOLOGIES, INVESTIGATES HOW WE CAN ENSURE THIS ADOPTION IS SUSTAINABLE Written by TAAVI MADIBERK
TECHNOLOGY
T
HE AUTOMOTIVE SECTOR is evolving at an unprecedented rate. According to the International Energy Agency (IEA), an estimated 50mn electric vehicles will be in operation by 2025, and 300mn by 2040. With BMW, Volvo, and Jaguar Land Rover promising electrified versions of their current models, most of the major car manufacturers have now announced significant investment, re-affirming this shift. Furthermore, with Dyson announcing that it is starting to manufacture electric cars and the European Commission forming a consortium that will drive the development of battery technology, there is no doubt that we are moving towards a world with electric vehicles at its centre. While we are certainly on the road to wider adoption, there is still one main drawback that could thwart public interest: charging infrastructure. Fundamentally, in order to support the innovation and commercialisation of electric
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vehicles, the right energy technology and infrastructure must be in place. This is critical to ensure the experience matches the hype.
THE RISE OF THE ELECTRIC HYPE Fuelled by the rise in air pollution and political momentum to reduce global warming, electric vehicles have grown in popularity and the technology has improved at a record pace to become a benchmark for innovation in the automotive sector. Competition in the marketplace is also increasing. From the first Prius hybrid model launched by Toyota in 1997, to the more recent full electric
‘THE CASE FOR MORE ENERGY EFFICIENT VEHICLES IS GAINING MOMENTUM’
The Range Rover Sport plug-in hybrid electric SUV signals an electified future
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TECHNOLOGY vehicle launches of the Tesla Model S, BMW i3 and Nissan Leaf, car manufacturers are investing in hybrid and electric vehicles and demand from consumers is gradually growing. Couple this with increasing environmental and sustainability regulations and the case for more energy efficient vehicles is gaining momentum. The adoption of this technology, however, is hampered by a need to optimise infrastructure to ensure it can support the surge in charging capabilities. Crucially, if the infrastructure cannot cope with peak power points, the adoption of electrical vehicles will reach a standstill.
GLOBAL ADOPTION REQUIRES A UNIVERSAL SOLUTION We already see Britain, France, Norway and China committing to ban diesel and petrol cars in favour of cleaner vehicles. This shift was most recently followed by one of the leaders in the automotive industry: Germany. At this point, it is becoming critical to adopt technology that allows us to smooth over the energy consumption needs that advanced countries are yet to experience. We need to take 38
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‘IF THE INFRASTRUCTURE CANNOT COPE WITH PEAK POWER POINTS, THE ADOPTION OF ELECTRICAL VEHICLES WILL REACH A STANDSTILL’
a holistic view to managing energy provision, as we will not be able to rely on drivers of electric vehicles to scatter the time when they charge their vehicles to reduce peak demand. With implementation commitment growing at a rapid pace, there is a pressing need for collaboration that will support solutions for energy technology challenges globally. This can only be done if governments, industry bodies and innovators join forces to support energy storage technologies that complement future developments in the sector. There is a need for a serious discussion on how to implement a stable grid that will be capable of withstanding the increased energy consumption inevitable with electric vehicles. Critical to this will be coping with especially high demand peaks and proving that the grid has the resilience needed for electric vehicles to become a success.
REVOLUTIONISING THE SECTOR It is possible to manage the growing demands on our energy infrastructure and ensure that there is a stable and reliable energy support that will drive the growth of electric vehicles, but 39
TECHNOLOGY it requires a fresh look at our energy storage mix. By investing in energy storage technologies that complement battery power, such as ultracapacitor technology, we can manage peak power needs. Ultracapacitors are one of the lowest cost solutions to helping with grid stability, and can play an integral role in supporting the national grid and managing power demands. Wide-scale electric vehicle charging creates serious issues with demand management, which can potentially cause power blackouts. These blackouts are caused mostly by short
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demand peaks, which usually last under a minute. This is precisely where ultracapacitors excel. As part of the grid solution, ultracapacitors can provide a means to ensure there are no blackouts during sudden changes in demand. On board vehicles, the technology should be evaluated and used in tandem with lithium-ion batteries in order to downsize the pack and increase the battery lifetime. By introducing capacitive technology to the power unit, it is possible to reach longer lifetimes and support the peak power needs of electric vehicles. However,
in order to do so, we must secure a reliable infrastructure to support this trend going forward. By prioritising investment in infrastructure and encouraging discussion and collaboration between governments, car manufacturers and technology companies, we will be able to create an environment where infrastructure, technology and the consumer act as one. Only then will be able to embrace electric vehicle revolution globally and support a future that is dominated by electrification.
‘WE NEED TO TAKE A HOLISTIC VIEW TO MANAGING ENERGY PROVISION’
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Business process outsourcing and the digital revolution
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PEOPLE
IS THE US SKILLS SHORTAGE PART OF A GLOBAL EPIDEMIC?
Jack Coker, Principal, Ducatus Partners, discusses how America can make its infrastructure “great again” as Business Chief finds out whether the current skills gap is a global phenomenon Written by JACK COKER Edited by OLIVIA MINNOCK
PEOPLE
“ Although it will take several generations to rebuild the infrastructure workforce to full capacity, companies can kickstart the process” – Jack Coker, Principal Consultant, Ducatus Partners
THE PEOPLE PROBLEM Modern infrastructure in the US was born from President Franklin D Roosevelt’s New Deal for the American people. Between 1935 and 1943, the Works Progress Administration (WPA) built over 500,000 miles of rural roads, 100,000 bridges and 1000 airfields. The WPA built sewers, tunnels and power lines. Hospitals, schools and fire stations sprang up across the nation. 46
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However, in recent years this spirit of investment has waned. In every report card since 1998, the American Society of Civil Engineers has awarded a ‘D’ to America’s infrastructure, reflecting chronic underinvestment in the sector. The society also estimates that, unaddressed, this could damage the economy to the tune of almost $4trn lost in GDP by 2025, slashing the disposable income of each household
across the United States by $3,400 each year. Fortunately, change is in the air and major infrastructure investment is back on the political agenda. The problem? There are not enough skilled people to meet demand. Whilst the WPA was created in part to soak up excess labour in the workforce, modern programs are hampered by the lack of it. All over the world, the skillsets required
in the labour market are having to adapt to technology transformation. As the US struggles to keep up with this demand, developments are more positive around the world with governments and educational organisations focussing on better preparing the workforce. Across the Middle East, Europe, Asia Pacific and parts of the Americas, employers are beginning to find it easier to find the right talent, but additionally it has been shown that particularly in Europe, contract, freelance and temporary work are all on the rise. This could point to a workforce adapting to fit their existing skillsets around changing demand. Globally, economic migration is on the up, with migrant workers increasingly of a more educated caliber. While migration can help to plug skills gaps across the world, as there is a bigger pool of talent to choose from for a country’s particularly profitable industries, in many cases restrictions on migration are set to increase, particularly in the UK and US. In addition, wage growth across the EME market has been slow and as such it can be easier to hire new employees than in other regions, like Asia and the US. 47
PEOPLE
“ There are essential A VICIOUS CYCLE individuals who Coming back to the US, underinmake the difference vestment in infrastructure has been a topic of discussion for decades. between on-time, However, the paucity of large on-budget projects infrastructure projects has led civil engineers and specialist managers and multimillionto depart from the industry. This is dollar overruns; and compounded by fewer people seeking a career in the space, and fewer students there aren’t enough enrolling in courses. A vicious cycle. of them” Several states have recognised the need for infrastructure investments. – Jack Coker, Principal Consultant, For example, Connecticut and Ducatus Partners Washington are in the early stages of multi-year transportation improvement initiatives. What’s more, some states overruns; and there aren’t enough have resorted to raising extra funds of them. to try and deal with the situation, A number of issues stem from the including raising gas taxes, a key workforce shortage. Lack of source of funding for road construction. experienced workers means companies In California, 20 of the state’s 58 must relocate employees across the counties already have transportation country on a project-by-project basis. sales taxes in place which has led to Relocation can be expensive, especially an exponential increase in infrastructure in states like California. projects. Unfortunately, even as the Another issue is that human resource money is starting to flow, the workforce and leadership teams focus almost has atrophied. In short, there are exclusively on project start-up to the essential individuals who make the detriment of ongoing roles throughout difference between on-time, on-budget the project lifecycle, resulting in projects and multimillion-dollar a backlog of hires which has a direct 48
May 2018
impact on the bottom line. Project and construction managers with five to 15 years of experience are in particular demand, and positions can remain open for months at a time; especially in the aviation, rail, transit and water sectors. This stretches workloads which in turn increases staff attrition. Another vicious cycle, further compounding the talent crisis. This is a particular problem for US infrastructure, but that’s not to say that other regions aren’t struggling to find staff with the specific skills needed as their economies shift and change.
TAKING ACTION Running into this problem with varying degrees, countries are taking different steps to upgrade the skillsets of their workforce in line with new requirements – but exactly where this responsibility lies is a contentious issue. Udemy recently commissioned a ‘skills gap’ report pertaining to the global work environment. This showed that the majority of workers around the world agree there is a growing skills gap, but largely feel “optimistic about their own skills and the competitiveness of their respective countries”. 49
PEOPLE On a worldwide scale, Udemy CEO Kevin Johnson stated: “the nature of jobs is quickly changing with automation, globalisation, government policies and other factors, making it impossible for anyone to predict which skills a job will require in the future. This only serves to widen the perceived skills gap.” In the US, 79% of full-time employees according to Udemy believe there is a skills shortage and 35% “feel personally affected by it”, but 80% of these believe that workforce reskilling will be successful. In terms of reskilling efforts, 41% think the government, through tax benefits or otherwise, should contribute. Udemy’s report analysed five global markets and found that in France, staff largely don’t feel the need to upskill, with 75% stating that they were confident with their current skill set – however in Brazil, 98% of those surveyed acknowledged the existence of a skills gap in their country. In terms of responsibility, 50% of Mexicans felt that it was up to the individual to upskill, with 17% placing responsibility on the government and 13% on employers. It was also found that some people have taken on a second 50
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job in order to utilise their skills in a more appropriate way, with 39% of Americans describing themselves as having a “side hustle” in comparison with just 18% in both Spain and Germany. In the US, there are doubtless deepseated issues that will not be solved overnight. However, with mega-projects in construction and infrastructure in the offing such as those tied to the 2028 Olympics, California’s high-speed rail and LAX’s $5mn upgrade program, there is no time to wait. With that in mind, the question is: how can companies
“ Human resource and leadership teams focus almost exclusively on project start-up to the detriment of ongoing roles throughout the project lifecycle, resulting in a backlog of hires which has a direct impact on the bottom line” – Jack Coker, Principal Consultant, Ducatus Partners
best manage and mitigate workforce issues to ensure projects are on schedule and on budget?
PROACTIVE TALENT MAPPING AND EDUCATION By partnering with a specialist executive search provider, companies can build a map of where talent is and where it needs to be. Talent mapping is about proactively building a virtual ‘bench’ of talent, anticipating need, and successfully mitigating unnecessary cost. Mapping allows companies to
proactively engage candidates which significantly reduces time to hire. Upon the award of a large infrastructure project, a high-potential candidate pool is identified, engaged, and ready to be mobilised. In locations that are difficult to recruit to, either due to high costs or low desirability, talent mapping is especially useful. Although it will take several generations to rebuild the infrastructure workforce to full capacity, companies can kickstart the process. By working in partnership with colleges, companies can start to mould the next generation by putting the right skills in place, imparting knowledge, and developing talent pipelines through internships. When the time comes for graduates to seek full-time positions, companies may benefit from having built respect and loyalty with interns. According to World Atlas, one of the countries suffering an even greater skill shortage than the US – indeed the ‘worst’ in the world – is Japan, and education is a leading cause. “Japanese companies are faced with potential employees lacking knowledge of the global markets,” the report argues, putting this down 51
PEOPLE to a “rigid” educational system which does not equip Japanese students for the modern world. In China, as it strives to overtake the US as an AI superpower, finding the correctly skilled individuals is paramount and has become a common issue for companies according to the Global Skills Index. Therefore, issues in transforming the economy aren’t
isolated to the US alone, but in China they are increasingly in the form of new technology skills and the ability to manage a tech-based enterprise, which often has to come from employees educated in the US or Europe. High costs of hiring mid-to-high management have resulted in MNCs being reluctant to set up core research centres in China, according to China Daily, which adds
“ In locations that are difficult to recruit to, either due to high costs or low desirability, talent mapping is especially useful” – Jack Coker, Principal Consultant, Ducatus Partners
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that China is making more efforts to work with universities, “especially top engineering institutions”. It is widely agreed in China that the likes of AI and Big Data should be exploited, but employers are now forced to look at the skills and talent pool on a global scale. The government has launched guidelines on focussing talent development in manufacturing, including integrating industry and education, promoting key adaptable abilities and qualities, and “establishing a high-level management skills pool”. While China leans more toward a planned economy than most, government involvement may be a direction for other economies to consider when dealing with the global skills gap. Although young talent is slowly entering the industry in the US, experienced talent is quickly flowing out. Senior talent is retiring and leaving an institutional knowledge gap. Companies have a responsibility to eliminate this from happening. Developing concrete succession plans to transfer knowledge and skills to the next generation minimises the risks to the retirement process. This applies across the organisation, from the
Jack Coker is a principal consultant at Ducatus Partners, an executive search and leadership consultancy focused in the global energy, infrastructure and process industries. He has significant search experience in both Europe and the Americas, serving a broad range of clients spanning architecture, engineering and construction across the energy, power and civil infrastructure sectors. Jack holds a Master of Science degree in Environmental and Earth Resources Management from Kingston University, London and a Bachelor’s degree, with honours, in Geography from the University of Portsmouth.
C-Suite, project leadership to the experienced niche engineers. Will the rediscovered appetite for infrastructure investment be enough for the US? Or is it a case of a day late and a dollar short? Only time will tell, but companies the world over can be sure of one thing: smart workforce planning and talent management is essential to successful project delivery. 53
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tay true to what you are
Marketing expert Allen Adamson tells us why businesses must be careful not to dilute their brand when introducing new products Written by STUART HODGE
S U S TA I N A B I L I T Y
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E LIVE IN a changing marketplace. Although all of the traditional staples of customer service are still welcome, they are becoming less important to a new generation that had grown up with the ubiquity of online shopping platforms and a plethora of choices like never before. More and more highstreet retailers are suffering at the hands of the growth of at-home pointand-click shopping, and it seems that the power of a strong brand identity is greater than ever before. With this in mind, Business Chief spoke to branding expert Allen Adamson, author of various books esteemed at universities globally on the topic, including his latest title ‘Shift Ahead: The Best Companies Stay Relevant in a Fast Changing World’. He spoke to us about how the power of brands is changing in the modern world, and the challenges of diversifying in a changing landscape. “In my world a brand is what your story is,” he says. “One of the challenges that many marketers face is ‘what is their story? What do they stand for?’ Once you figure out your story, your 58
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brand, what has become increasingly difficult is ‘how do you get that story out there?’ Like many things, a theory in marketing and branding is pretty easy, but execution is really hard. What I mean by that is people only recommend extraordinarily good things or talk about extraordinarily bad things. They don’t recommend or talk about things that are just ‘okay’.” Consumer habits are no doubt changing too. In fact, a recent study by EFG Companies looking at digital
“ People only recommend extraordinarily good things or talk about extraordinarily bad things. They don’t recommend or talk about things that are just ‘okay’” – Allen Adamson, Co-Founder at Metaforce
purchasing in the car market revealed that half of customers will now check reviews online before even contacting a dealership. Not just that, but the study would also indicate that we are becoming more picky and impatient: 43% of the pool of almost 1,500 respondents said that they were more likely to visit a dealership if it had plenty of information on its website, and 83% expected a response from the dealership within 24 hours of sending an online vehicle inquiry, with 16% 59
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“ If you don’t look good, most consumers are not going to read the product specs to find out what’s inside” – Allen Adamson, Co-Founder at Metaforce
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wanting information immediately or within the hour. However, the nature of the response people are expecting has changed, with only 9% wanting a phone call from the dealership after they’ve submitted an online request. Not just that, but Adamson believes the way we are interpreting the world around us now is changing the way that consumers are recommending products. He says it’s now more often about how they appear visually than whether they’ve been recommended by one person to another. “Younger consumers are spending more and more of their time sharing stories, sharing ideas, sharing pictures,” says Adamson, who is also the founder of marketing and branding consultancy Metaforce. “With that in mind, I think ‘word of eye’ is becoming more important than word of mouth. I think the quality or the visual appeal of things is growing in importance because people are visual to begin with, and now that they can share pictures as fast as they can share words and ideas, you have to look good no matter what you’re doing. 61
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“A couple of years ago I went to the Consumer Electronics Shows in Vegas and no matter which manufacturer I looked at, from 20 companies from China and from India that I’ve never heard of to Apple, Sony and Samsung, everyone’s products looked spectacular. All of a sudden, even the cheapest products looked incredibly stylish. Now, if you don’t look good, most consumers are not going to read the product specs to find out what’s inside. They’ll make a snap decision and if you don’t look good, you can’t fix it.” Another trap that manufacturers have to avoid falling into is having too myopic a viewpoint. If you are Coca-Cola, don’t just look at Pepsi as your major competitor or you could fall off the pace. With so much choice out there now, every soft drink manufacturer is a competitor. Blackberry is a prime example of a company which has suffered from being too tunnel-visioned in its approach. The Canadian smartphone provider did help to drive the boom in smartphone pervasion, but staunchly believed that consumers would never 62
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“ You have to make sure that whatever product you go into, the benefit of your brand is still delivered” – A llen Adamson, Co-Founder at Metaforce
move away from using a keyboard. The entire management team was convinced that the iPhone and touchscreens were a toy that kids would be playing with, but that any serious person typing out messages for business would never give up their keyboard. This undiversified view was why Apple and other competitors were able to steal a march and ratchet up their market share.
It’s a danger for every company, but do these changes in consumer behaviour and the requirement for increased brand awareness mean it’s now harder to diversify your line of products within an overarching brand identity? Adamson doesn’t believe so, but he does feel companies need to be a little cleverer about how they do it, ensuring that the integrity of what their company
stands for is not compromised. “You have to make sure that whatever product you go into, the benefit of your brand is still delivered in that new category or that new segment and it reinforces what the core idea is,” he asserts. “I think BMW has been pretty successful switching from sports sedans to SUVs. Yes, their SUVs perform differently than their other models but when they talk about why their SUV is better than other SUVs, it’s still tied to that core idea of ‘the ultimate driving machine’. If you’re in an SUV, ‘the ultimate driving machine’ lets you go through a riverbed and up an incline without tipping the car over, and through mud and muck. If you’re driving a sports sedan, that means you can go around the corner on the highway at 60mph and not feel that you’re going 60mph around the corner. They have a clear definition of what BMW-ness is. “Now they’re experimenting with electric cars, the definition of what ultimate driving means has some latitude but no matter what it is, the worst thing you can do to a brand is to line-extend it or diversify into 63
S U S TA I N A B I L I T Y a product that’s unsuccessful and is rejected by the market. Because not only will you miss the opportunity to sell SUVs if you’re BMW, but you’ll do more damage to your core product line.” An example of a company losing vision of what made its brand truly special, as Adamson illustrates in his latest work, is Sony. “Sony used to stand for magical things when they first were around,” he says. “Their television sets, their screens had matchably better colour than anyone
else’s. When you put on their Walkman 20 years ago, the sound was phenomenal. Then they started to stick the Sony name on products that didn’t give you goosebumps like clock radios, shower radios… not quite toasters, but they put their name on everything and all of a sudden on phones that were not that good. “I think the key part of success today is being able to deliver your brand benefit in whatever form your customer wants it. The trick is not to go so far
“ If you can’t deliver a great experience at these new diversification points then you’re basically diluting your brand, you’re stretching it too thin” – Allen Adamson, Co-Founder at Metaforce
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where you’re just extending and, like the Sony story, you have nothing special. When we look at brand extension we look at both fits. Yes, the Sony brand can fit in shower radios but does this have any leverage? “If you can’t deliver a great experience at these new diversification points then you’re basically diluting your brand, you’re stretching it too thin. You are looking at short-term sales versus longterm success. More and more brands have stretched so far that they don’t
stand for anything because they become diluted. Famous theory is ‘the stronger the focus, the stronger the brand’. If a brand stands for everything and is in every category it’s going to lose its success. “All of sudden people looked at Sony and said ‘oh, it’s not that special. Their phones aren’t that good. The shower radio is not that great’. They lost their sizzle because they diversified well beyond their ability to deliver a core Sony experience.”
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S U C O F Y T I C
Headline
Seque rest volorum aute velestio intem illibus es qui ut alit et, sita iuntur? Writ ten by AUTHOR
T THE A H W T A K O O L A R O F S D L O H E R FUTU IT Y C L A T I P A C ’S O M O R O CC
S NNON LEWI A H S y b n e t t i Wr
T A B
CITY FOCUS
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RABAT AT A GLANCE LOCATED BETWEEN THE Atlantic Ocean and the Bouregreg River, Rabat is Morocco’s capital city. According to World Population Review, there are only two cities in Morocco with over a million people: Casablanca, with a population of 3.14mn in 2018, and Rabat, with 1.66mn. Although only about a third of the size of Casablanca, Rabat is the economic centre of Morocco. Put together, the Rabat and Casablanca regions make up nearly half of Morocco’s Gross Domestic Product (GDP). Where the Casablanca-Settat region brings in 32% of Morocco’s GDP, the Rabat-Salé-Kénitra region
‘RABAT WORKS, BECAUSE OF ITS LOCATION, AS A CONNECTOR BETWEEN THE MEDITERRANEAN AND THE AFRICAN CONTINENT’
isn’t far behind, accounting for 16.3% of Morocco’s wealth. Morocco’s total GDP is of $101.45bn, according to Trading Economics, meaning Morocco represents 0.16% of the world’s economy. In 2016, Rabat was ranked by Mercer as 168th most expensive city for newly relocated people, up seven spots from its 2015 rank of 175th. Called the ‘Washington of North Africa’ because of its picturesque parks, multitudinous government buildings and monuments, wide boulevards, and traditional old homes which have been converted into Riads (boutique hotels), Rabat can be divided in two areas: its city limits and its wider urban area. The city limits take up 117 sq km and only account for 577,827 citizens, according to World Capital Cities. Adding in its urban area, Rabat covers 184 sq km. While the population density within in the city is of approximately 4,900 people per sq km, it increases when taking into account the urban area. According to World Capital Cities, that population density is 10,200 people per sq km.
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INDUSTRY IN RABAT Agriculture and fishing are major industries in Morocco, accounting for 12.6% of its GDP in 2015. Industry, mining, water, electricity, and construction made up 26.1% while market and non-market services accounted for 49.7%. Morocco’s primary area, however, is importing and exporting – something which Rabat, as a coastal city, relies upon heavily. Though Morocco’s primary trading partners are France and Spain, Rabat also works, because of its location, as a connector between the Mediterranean and the African continent. In 2016, Morocco
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exported approximately $22.9bn of goods. Rabat, known for its local arts and crafts, ends up shipping most of those to neighbouring countries. The primary exports, however, are clothes, fish (particularly sardines), phosphates, and fruits and vegetables. Morocco is home to around two thirds of the world’s supply of phosphates, making its mining a lucrative business. Although only 2% of the population works in this sector, phosphate mining is responsible for half of the entire country’s income. Ferrying also provides a pivotal economic crux for both Rabat and
Morocco. The ferry business, tasked with bringing immigrants across the Straits into Spain, is lucrative. According to the Crisis Management Initiative (CMI), a Finnish organisation, the youth unemployment rate in Morocco is “alarmingly high�. While 30% of the country’s citizens are in the 15-29 age range, interactive sessions with young citizens found that the country offers a low quantity of quality entry-level jobs. Some of the reasons cited by the CMI are cutbacks to employment in public sectors, a lack of coordination on policies regarding youth employability,
and low expectations of first-time jobseekers. However, the city is not stagnating. According to LouisBernard Lechartier, director of property company Balima, Rabat previously relied completely on administrative jobs but has recently seen an influx of business. A large call centre provides opportunities for many customer service jobs and, according to Lechartier, it was precisely the abundance of skilled labour in Rabat that interested the call centre business, as it became cheaper to build and hire there than in Casablanca.
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THE FUTURE OF RABA
RABAT’S POPULATION IS
1.66MN
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It was recently announced by Morocco World News that Rabat’s Mohammadia School of Engineering will host the 24th Emi-Enterprises Forum in an attempt to hold a conversation around “Africa 4.0: Capital Challenge for Tomorrow’s Engineer”. The talk will focus on the role of Morocco in relation to contemporary Africa, as well as the potential for expansion within certain sectors of the African economy including industry, digital technology, and entrepreneurship. The university, which was founded in 1959 by King Mohammed V, is the leading engineering school in Morocco,
AT and will be seeing around 800 guests participating in the forum. Another project that looms in Rabat’s near future is what has been called the “rebranding of Rabat as a city of light and the cultural capital of Morocco” by the Financial Times. Launched by King Mohammed VI, the project will centre around several infrastructure projects of varying sizes and timelines. Some are projected for the future, such as the Grand Theatre, while others are already improving the city. The Grand Theatre, designed by architect Zaha Hadid and set to be built on the west bank of the
Bouregreg, is part of the Wessal Bouregreg development project. Where the Grand Theatre will seat 1,800 people and include a 7,000person amphitheatre, the overall project is a 110-hectare venture that will also include an archaeological museum, an arts centre, malls, a residential district, and a national archive building. On a smaller scale, new district, roads, tunnels and bridges have already been built, while the modern tram system that was established in 2011 is due to be extended. 2014 saw the inauguration of the Mohammed VI Museum of Modern and Contemporary Art.
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Top 10 commercial buildings in Africa We went through Answers Africa’s list “See Africa’s 15 Most Expensive Buildings” and compiled a list of the 10 most expensive commercial buildings in Africa, by construction cost Writ ten by SHANNON LEWIS
TOP 10
88 ON FIELD $40mn
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ONE MERCHANT PLACE $40mn
Located in Sandton, South Africa, One Merchant Place took an astonishing $40mn to build, according to Answers Africa. It is part of a building complex made up of four office buildings, and is alternatively known as RMB Towers. With construction beginning in 1996, One Merchant Place was opened in 2000. At 84m high, it consists of 20 floors and takes up a floorspace of 28,000 sqm, making it the building with the most floorspace in its complex and is owned by Rand Merchant Bank Properties. 76
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Designed by two architecture firms, Murphy/Jahn, Inc. Architects and Stauch Vorster Architects, 88 on Field racked up $40mn in construction costs. Located in Durban, South Africa, 88 is owned by AngloAmerican Properties and Services and serves as a block of offices. The building consists of 26 floors, making it an impressive 113.7m high while taking up a total land area of 24,500 sq.m. Begun in 1983 and finished in 1985, it was originally known as the Southern Life Building.
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MAISON DES DÉPUTÉS $50mn
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HILTON TABA RESORTS AND NELSON VILLAGE $41mn
Located in South Sinai, Egypt, Hilton Taba Resorts and Nelson Village was originally developed and built by the Israelis for $41mn. It opened in 1982 under the name Ramada Hotel and was signed over to Egypt free of charge in 1989 as a part of a peace treaty agreement between the two countries. With 14 floors, 12 above ground and two below, it stands at around 41m and overlooks three neighbouring countries: Jordan, Israel, and Saudi Arabia. Built on the shore of the red sea, one of its biggest draws is its private beach.
Seventh on our list is Maison des Députés, a hotel located in Yamoussoukro, Ivory Coast. Despite only being a seven-storey building, which classes it as a low-rise building, it built up $50mn in construction costs and took two years to build, with construction beginning in 2004; its doors opening to the public in 2006. Surrounded by swimming pools and lush gardens, its pale pink pyramid exterior is a major attraction to tourists and locals alike.
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MICHELANGELO TOWERS $64mn
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HILTON DURBAN $61mn
Hilton Durban is a five-star hotel based in Durban, South Africa. Designed by FGG Architects Incorporated White Arkitekter AB, it took $61mn to build. Standing at 76m, it consists of 21 floors, 19 above ground and two below, and took over two years to build. It stands next to the International Convention Centre and put together, these building sites take up four city blocks that share underground parking. Hilton Durban’s structure is built upon thick foundation, with support up to 40m deep beneath the tower portion of the hotel. 78
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Located in Sandton, South Africa, Michaelangelo Towers is a hotel that managed to rake up $64mn in construction costs. Sandton stands as “the richest square mile” in Johannesburg, South Africa and was designed by architects Bental Abrasion & Partners. Standing at 140m, it consists of 34 floors above ground and two below with 242 suites and rooms. AFK Insider states that Michelangelo Towers connects to the Sandton Convention Centre, which is convenient for hotel guests that need to work in the centre and is also the home site of one of the most expensive penthouses in Sandton, valued at $3mn.
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PORTSIDE TOWER $138mn
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THE WEST HILLS MALL $93mn
Designed by Augutus Richardson, the West Hills Mall stands in Accra, Ghana, taking up 23 acres of land. Co-owned by Delico Property Developments, and Social Security and National Insurance Trust, it cost $93mn to build. The West Hills Mall, constructed by South African contractors, consists of 67 local shops and 65 chain outlets. Opened in 2014, it is the most expensive shopping mall in West Africa, currently taking up 27,700 sqm in floor space. However, a proposed second phase will bump the floor space up by 7,000 sqm.
Portside Tower, a series of office spaces to let, took $138mn to build. Located in Cape Town, South Africa it is the tallest building in Cape Town, standing at 139m high, only around 9m below the city’s maximum permitted height for buildings. The tower is co-owned by Old Mutual Investment Group Property Investments, which rent it out as office spaces. Designed by architects Louis Karol Architects and DHK Architects, construction began in 2011 and was finalised in 2014. Not only does it stand at 32 floors and have a capacity for 3,000, but it is also the first large building in South Africa to almost exclusively use LED lighting.
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CORINTHIA HOTEL TRIPOLI $152mn
Corinthia Hotel Tripoli was inaugurated in 2003 by the then Prime Minister Shukri Ghanem. Located in Tripoli, Libya. The hotel cost $152mn to build and is owned by Ghanem. It was originally known as the Corinthia Bab Africa Hotel and was designed by architecture firm Xuereb Martin & Associates. The Corinthia is a fivestar hotel run by Maltese Corinthia Hotel International and is considered the most expensive luxury hotel in Africa, consisting of 28 floors racking up a height of 100.48m.
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AFRICA UNION CONFERENCE CENTRE AND OFFICE COMPLEX $200mn
Topping our list as the most expensive commercial building in Africa is the Africa Union Conference Centre and Office Complex, located in Addis Ababa, Ethiopia. The complex cost $200mn in costs, which was funded by the Chinese government as an attempt to promote international relations between China and Ethiopia. It is the second most expensive building in Africa behind the recently-built Bibliotheca Alexandria in Egypt. Owned by and the headquarters of African Union, its tallest tower stands at 99.9m tall, making it 20 floors in total making it the tallest building in the city. AfricaFacts ranked it the number one most beautiful building in Africa.
ENRICHING
GHANA’S FARMING INDUSTRY
Written by DALE BENTON Produced by JUSTIN BRAND
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ECOM TRADING
ECOM Ghana continues to develop the agriculture of Ghana by placing the farmer at the heart of its operations
s a leading global commodity merchant, with a specific focus on developing and fostering sustainable supply chains in over 40 agricultural markets worldwide, the responsibility to provide real value and growth right through the supply chain, to the farmers, is something that cannot be taken for granted. For ECOM Trading, it’s in the company’s very nature. “ECOM is a global player with a significant footprint here in Ghana,” says Muhammadu Muzzammil, Country Manager and Business Head Commodities & Logistics at ECOM Ghana. “What really drew me to the company was its purpose and the strategy, ECOM has a huge focus on increasing rural prosperity in the communities that we participate.”
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It is this focus and this commitment to delivering true value to those communities that has actually seen ECOM significantly grow its footprint in Ghana over the last four years, with Muzzammil pointing to a “300% growth”. ECOM’s strategy of enhancing and fostering rural prosperity was conceived by Rahul Gopinath, Regional Director, Africa. Rahul looked at the traditional operating model and sought to implement a system that would reach out to the farmers, to the producers. “Sustainability strategies have, in the past, benefited the consumer more than the producer and the farmer,” says Rahul. “We realised that we could create a model where we could provide prosperity to the community and at
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Cocoa farmer
MUHAMMADU MUZZAMMIL
Country Manager and Business Head Commodities & Logistics at ECOM Ghana
Muhammadu Muzzammil is the Country Manager for ECOM Ghana. He works closely with the small holder farmers in Ghana to implement ECOM’s inclusive strategy to improve rural prosperity while meeting its sustainable supply chain obligations. He currently overseas cocoa, edible nuts and spices, logistics, sustainability and farm management services, agro input businesses and new business ventures in Ghana and Burkina. Muzzammil has previously worked with Triton Group, a frozen commodity trading and distribution company in various capacities in Africa. Muzzammil has completed his MBA from Indian Institute of Management, Shillong. He is also a gold medalist in Automobile Engineering from Anna University. africa.businesschief.com
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the same time provide true value and benefits to the farmer through a higher disposable income which in return provides them with a higher standard of living and can continue to farm.” Muzzammil joined ECOM as Business Head in 2016, overseeing the company’s logistics and commodities division which supplies more than 180,000 metric tonnes of cocoa and cashew direct from local farmers. Over time, his role developed and as Country manager he begun to
oversee the company’s sustainability efforts, farm management services, agro input business and even supporting the company’s edible nuts and spices business in Burkina Faso and Guinea Bissau. Having worked in the food and logistics space in Africa with some of the largest frozen food distributors in West Africa, Muzzammil knows first-hand the nuances of working with local suppliers and local farmer across the African continent. RMG
Ghana Ltd
AGRICULTURE ON A SUSTAINABLE BASIS RMG Ghana Ltd is one of the major companies within the Agricultural industry of Ghana with all its products offered Tel: +233 302-776447 / 302-773458/9 to the farmer sourced from Research and Development www.rmgconcept.com | info@rmgghana.com intensive manufacturers across the globe.
Address: No. 14 Narku Ipan Rd. near Nyaho Clinic, Airport Residential Area
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“Africa is full of opportunity and trust,” he says. “There is the trust that people have in you, trust from the board and management that provides you with great opportunity to go out and deliver on the promises of the organisation. You wouldn’t normally get this in a more developed economy, but because we are here, to really drive growth throughout Ghana, that trust goes a long way in enabling that.” ECOM is committed to the development and advancement of rural prosperity, but how does it actually deliver on this commitment? A number of organisations state that economic growth and corporate social responsibility are some of the highest priorities in their strategic direction, but what separates ECOM from other companies? In the first instance, ECOM defines the very nature of rural prosperity as starting with the farmers themselves and looks to understand just exactly how it can provide value and growth to the farmers. It does this in two parts, by increasing the farmer’s
RAHUL GOPINATH NAIR Regional Director - Africa
Rahul Gopinath is the Regional Director for ECOM Agro Industrial Corporation for the African Region. He works very closely with smallholder farmers in Africa providing sustainable supply chain solutions to blue chip food companies in cocoa and coffee. His business also provides base of the pyramid solutions to the populations in Africa to improve income and farm yield. Rahul is also responsible for the new business ventures for the group in the region. Rahul has previously worked with Armajaro Holdings and Olam International in multiple countries in Africa, London and Singapore. Rahul has done his General Management Program from Harvard Business School and has an MBA from the Institute of foreign Trade, India. He is an engineer by training and prior to his business experience he has worked with IBM and the Indian Space Research Organization.
africa.businesschief.com
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revenue and reducing the costs that the they will incur. “ECOM comes in with an approach where it’s not just acting as a trader to come and buy the farmers’ beans, it focuses on other business models that supplements the farmer’s income,” says Muzzammil. “Farmers across Ghana don’t have access to large farmlands, large yields and large revenues. They are sustenance farmers, using farming as a means of surviving each and every day. This is where ECOM works extremely hard to support them.” ECOM takes on a very “hands on” approach to working with local farmers and it does so through a number of initiatives, each designed to enrich lives. One such initiative is the Crop Doctor. The purpose of the Crop Doctor is to provide a complete service for the farmer not only providing inputs to protect the crops from diseases, but also equip them with the knowledge about farming, disease control, identification of infestations. Crop doctor also
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enables convenient payment options to ensure the farmer does timely applications without having to worry about his cash flow. Crop Doctor is able to also offer this facility to the farmers at a much cheaper price. “We minimise the supply chain by contract manufacturing these inputs from the best plants in the world and supplying directly to our farmer base,” says Muzzammil. “This really provides a major advantage for the farmers and saves close to 20-25% of their overall operating costs.” The company’s farm services don’t stop there either. ECOM’s Sustainability Management Services (SMS), works with farmers to enable them to improve their yield through best practices in Agriculture, Environmental and Social standards. SMS also works on additional livelihood programs, farmer business school trainings which equip the farmer with the knowledge to see farming as a business and also enables a year round income generation opportunity. This also extends to farm management
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“Farmers across Ghana don’t have access to large farmlands, large yields and large revenues. They are sustenance farmers, using farming as a means of surviving each and every day. This is where ECOM works extremely hard to support them” Muhammadu Muzzammil, Country Manager and Business Head Commodities & Logistics at ECOM Ghana
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services target directly at older farmers and absentee farmers, ones that still require farming to survive but don’t have the same level of capabilities to run it themselves. ECOM will completely manage the farm and return all the revenue back to the farmer in a clear, transparent and accountable way, continuously improving the
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prosperity of those farmers. “The model that we use really looks at how a business can actually improve the rural prosperity and livelihood rather than rely on an NGO to do this,” says Muzzammil. “That’s what we are trying to achieve in Ghana. That’s the end goal.” As Muzzammil noted, ECOM has achieved a 300% growth
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The ECOM Global board members visited Ghana to appreciate and encourage the team to achieve the purpose of increasing rural prosperity
over the last four years but what can he attribute this success to, and how is this measured? He looks along the value chain of ECOM and points to a spirit of entrepreneurship. ECOM strives to create entrepreneurs at the district level across Ghana, with micro-entrepreneurs at village and society levels.
“We’re not envisaging everyone to become an employee of ECOM,” he says. “Rather, what we are doing is creating businesspeople in every village. This is close to 6,000 micro entrepreneur network and these people are engaged in purchasing or selling and, in the future, will help the farmers through training and managed services.
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“The model that we use really looks at how a business can actually improve the rural prosperity and livelihood rather than rely on an NGO to do this. That’s what we are trying to achieve in Ghana. That’s the end goal” Muhammadu Muzzammil, Country Manager and Business Head Commodities & Logistics at ECOM Ghana
Ecom supplies farmers with agrochemical products
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Agrochemical inputs of Ecom Ghana - Crop Doctor products
“This spirit of entrepreneurship is what I feel is a huge contributor to our success as a company.” Rahul takes this one step further, identifying that any success that ECOM has achieved has not come from having the best facilities or brands. “Our greatest asset is the good people we have,” says Rahul. “If you want good people to create value for you, they need to feel that their inherent ambitions are being met and, in most cases, that means developing them as people and as employees. “What we are trying to do here is
based around finding innovative ways of solving a problem and in order to do that and to find innovation, you need to empower those employees.” As a commodity trader, ECOM places great emphasis on establishing strong relationships with a number of vendors, vendors that will help the company deliver on its promise. ECOM works with some of the largest chocolate makers in the world, such as Lindt, Nestlé, Mars, Hershey and Ferrero, but for Muzzammil it’s much more about how those companies’ sustainable goals and beliefs align with ECOM. “All these clients have their certified, sustainable, and verified programmes going all the way back to the farmers,” he says. “And obviously, the clients every year on year, they commit to their sustainability programme. Where ECOM comes in is, we act as the executor for the clients on the ground and to me, these vendor relationships have really proved key in enabling the significant growth of the company.” ECOM is currently undergoing a major increase as to the scale of its
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service delivery and its product offering. With around 140,000 farmers currently working both directly and indirectly with ECOM, and on the back of considerable growth, what does the future hold? Muzzammil points to 2020 as a key target year. “Of those 140,000, we’ve only been able to scale around 30,000 farmers on a full-time basis,” he says. “Our aspirations are to get all farmers in our farmer base, get there by 2020. Our goal has always been the same, to enrich the lives of the farmers in Ghana which in turn will allow the
country to grow and the economy to improve. And we will achieve this by increasing our product offering, our service delivery and continue our incredible work with our farmers.” In the end, as Rahul notes, ECOM will always strive to deliver on its vision of rural prosperity. “There is an adage in commodity training that says volume is vanity, profits are sanity”, says Rahul. “For ECOM, we believe that prosperity has to be a reality – there’s no way we can provide without having that for our farmers.”
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COMBINING LOCAL FLAVOUR WITH GLOBAL PRESTIGE Written by Dale Benton Produced by Glen White
AS YUM! BRANDS EXPANDS IN THE EMERGING AFRICAN QSR MARKET, DELIVERING SUCCESS COMES WITH A LOCAL TOUCH
W
ith more than 45,000 restaurants in over 135 countries and territories, Yum! Brands is truly a pioneer in the global quick service restaurant (QSR) market. Since spinning off from PepsiCo in 1997, Yum! Brands has continuously developed successful food franchises such as Taco Bell, KFC and Pizza Hut into markets spanning the globe. Focusing on emerging markets such as the North African region (including Morocco, Egypt and Tunisia) and Sub-Saharan Africa (including South Africa) has been crucial to the growth of these brands. The African continent in 2018 is one of opportunity and growth, and as Yum! Brands looks to further develop the Pizza Hut brand it has called upon the services of Ewan Davenport, Yum! Brands General Manager for Pizza Hut Africa. “With this development of Pizza
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Hut, it’s an incredibly exciting growth pipeline,” he says. “We are not just growing Pizza Hut as a global brand, we are to a certain extent growing pizza as a food category in itself because it’s not as prevalent in Africa as it is across the world.” Davenport understands the African market, having worked with SABMiller. It is this experience in the delivery of global and regional brands into local markets that has provided Davenport with a key understanding of the market dynamics and, more importantly, how these global practices and brands will and will not be successfully received. “In Africa, affordability will always be a challenge, be it in the pizza category or the beer category. It’s not always going to be readily accessible to everybody,” he says. “This has had a huge influence on the value chain because we are trying to deliver pizzas to the high standards
FOOD & DRINK
“WE’VE FOUND THAT OUR BRANDS HAVE BEEN AT THEIR MOST SUCCESSFUL WHEN THEY HAVE A REALLY STRONG LOCAL OPERATOR WHO KNOWS HOW COMMERCE WORKS AND KNOWS HOW THE AFRICAN MARKET WORKS” – Ewan Davenport, General Manager, Africa, Pizza Hut – Yum! Brands
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TASTES BETTER TOGETHER
Coca-Cola (ZA)
Coca-Cola (ZA)
@CocaCola_ZA
Coca-Cola (ZA)
@CocaCola_ZA
@CocaColaZA
@CocaCola_ZA
@CocaColaZA
ENJOY THE FEELING
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FOOD & DRINK
“ONE THING THE COMPANY DOES NOT COMPROMISE, NO MATTER WHERE IT IS IN THE WORLD, IS FOOD SAFETY STANDARDS. WE HAVE WORLD CLASS FOOD SAFETY PROCEDURES AND ALL OF OUR FOOD AND OUR INGREDIENTS AND SUPPLIERS ARE HELD TO THE HIGHEST OF STANDARDS” – Ewan Davenport, General Manager, Africa, Pizza Hut – Yum! Brands of the Pizza Hut global brand.” At the time of writing, Pizza Hut operates over 200 restaurants across the entire African continent, with the intention of maintaining a steady momentum of new openings. The company recently opened its 100th store in the Sub-Saharan Africa region, which includes South Africa, and has bold growth plans in the region over the next several years. As a global brand with global
standards that must be adhered to across every franchise in every country, Pizza Hut focuses on four growth drivers to deliver unrivalled success. Distinctive, relevant and easy bands, unmatched franchise operating capability, bold restaurant development and unrivalled culture and talent; these are the
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“IT’S AN INCREDIBLY EXCITING TIME RIGHT NOW FOR PIZZA HUT… NOT JUST FROM A GROWTH PERSPECTIVE, BUT THE EXCITEMENT AND ACCELERATION FROM OUR FRANCHISEES AND PARTNERS RUNNING ALONGSIDE SOME INCREDIBLE WORK WE WILL DO WITH THE COMMUNITY” – Ewan Davenport, General Manager, Africa, Pizza Hut – Yum! Brands
THE PERFECT DELIVERY
Together, we enable seamless and sustainable end to end value chain solutions driven by our customer’s unique environment, through excellence in our people, our values and systems as the leading logistics multi-temp provider in Africa.
PASSION
INTEGRITY
PURPOSE
INNOVATION
CARING PERSONALLY
EXCELLENCE
CORPORATE OFFICE: WATERFALL DISTRIBUTION CAMPUS, 2 BRIDAL VEIL RD, MIDRAND DISTRIBUTION CENTRES: CAPE TOWN | DURBAN | CENTURION | JOHANNESBURG | MIDRAND | PORT ELIZABETH DIGISTICS.CO.ZA | 011 663 3500 | INFORMATION@DIGISTICS.CO.ZA
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four core values that distinguish the company and are crucial to tapping into the high growth opportunity African QSR market. For Davenport, the key to success has been and will continue to be an uncompromising approach to delivering brands. “One thing the company does not compromise, no matter where it is in the world, is our food safety standards,” he says. “We have world class food safety procedures and all of our food and our ingredients and suppliers are held to the highest of standards. This does not change here in Africa; we expect our suppliers to meet the same standards that Pizza Hut meets anywhere else in the world.” As a franchiser, operating in multiple countries brings with it challenges. Different markets, different consumers with different tastes and different suppliers. “We try to localise as much as possible in Africa from a purely supply and sourcing perspective,” says Davenport. “So, we work with suppliers in the countries we operate in, which is a
significant contributor to local jobs, and we work in partnership to help develop local supply capability.” As the company doesn’t look to compromise, Davenport does admit that it operates to an 80/20 rule, remaining open to some level of local adaptation to align with regional and local flavours. “But we absolutely don’t stray too far from the global Pizza Hut experience,” he says. “People are coming to Pizza Hut to have Pizza Hut after all.” Say the name Pizza Hut anywhere in the world and a recognisable, consistent and ultimately successful brand comes to mind. So when Davenport speaks of people heading to Pizza Hut because they recognise that brand, how does that work across a continent where pizza is not as popular as other QSR brands? This is where technology, particularly accessibility, proves crucial to Pizza Hut. In the modern world, the consumer has technology at his or her fingertips, is digitally enabled in almost every aspect of their life and, more importantly, demands that same level of digital accessibility
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from brands such as Pizza Hut. “One of our big strategies across Africa is how can we expand and lead the charge in terms of digital access to our pizzas,” he says. “Online ordering is essential as mobile penetration is much greater than people realise in this region and Africa has a number of online tools that are relatively underutilised. “There is an opportunity, and as far as Pizza Hut goes, we will expand our online presence and ordering accessibility significantly over the next three months.” Embarking on an expansive growth journey into a new geography, a new market that is already densely populated, cannot be achieved alone. As Pizza Hut works with local partners, in some cases growing their capabilities, Davenport cannot stress enough how important it is to have these local partners and establish strong working relationships. “We are an almost entirely franchised organisation across the African continent – we ultimately rely on working with local franchise partners to develop our brand,” he
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says. “We guide our partners from our Restaurant Support Centre and help our franchisees in their dayto-day operations and growth. “As an entity coming into a country, it’s very easy to try and establish a business without fully understanding the inner workings of that country. We’ve found that our brands have been at their most successful when they have a really strong local operator to partner with, who knows how commerce works within that country and also understands the African trading environment.” That role of a foreign, global brand setting foot into the African continent and trying to cement itself as a leader, brings with it a sense of responsibility. Pizza Hut, provides significant working opportunities to local people and extensive training programmes. As a business, it’s entirely focused on people. This is something that is close to Davenport’s heart. “We do put a massive amount of emphasis on generating and propagating our culture. And as part of that culture, training
FOOD & DRINK
Ewan Davenport General Manager, Africa, Pizza Hut - Yum! brands
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and looking after our people is at the heart of it,” he says. “As a company we recognise hard work and we believe that positive reinforcement and recognition will encourage people to continue doing the right thing and obviously continue the growth of the Pizza Hut brand as well. The face of our brand is in fact the many incredible team members operating throughout our restaurants. If we accelerate a positive culture built around respect, recognition and passion for our brand our customers will feel the love too.” But it’s not just growing an internal culture. Pizza Hut is a strong ambassador for empowering the local community. Through an initiative called A Slice of Africa, a number of staff members will embark on a journey to visit a Pizza Hut store in every country across its entire African footprint and deliver Red
Reading boxes to African children, kicking off Pizza Hut Africa’s Literacy Project. These boxes are Pizza Hut branded pizza boxes containing books and reading materials, as Pizza Hut looks to get more children reading across the globe. For Davenport, that is the real endgame, not just exponential growth as a brand but growth as a key contributor to the African continent. “It’s an incredibly exciting time right now for Pizza Hut,” he says. “Not just from a growth perspective, but the excitement and acceleration from our franchisees and partners running alongside some incredible work we do to make a difference within the communities we serve. “That for me, is one of the most fulfilling things I can do and the pinnacle of my entire career so far, and I’m very grateful to be a part of it.”
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