Acumen 20

GAMA & IMMELT

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• Second Quarter, 2017

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contents Issue 20 • Second Quarter, 2017

Issue 20 • Second Quarter, 2017

features

P.28

GAMA, IMMELT AND INDUSTRY 4.0 Digitising Africa's transport network.

GAMA & IMMELT

INDUSTRY 4.0

Issue 20

ADRIAN SAVILLE SA’S HEAVYWEIGHT CHAMPIONS NATALIA MOLEBATSI SONGS & WORDS R39.95 incl vat

• Second Quarter, 2017

IAN GOLDIN THE NEW RENAISSANCE THE ADVENTURE DOLLAR SA’S MAJOR OPPORTUNITY

P.23

ON THE COVER Photo: Gareth Jacobs

THE RENAISSANCE REBORN

Exploring the risks and rewards of the new Renaissance with Professor Ian Goldin.

P.46

THE ADVENTURE DOLLAR

GORDON INSTITUTE OF BUSINESS SCIENCE

Photojournalist Jacques Marais explores the potential of adventure sport and tourism.

ACUMEN IS ALSO AVAILABLE AS AN APP for your iPad or iPhone in the Apple App Store, as well as in the Google Play store for your Android device.

P.52

SA’S HEAVYWEIGHT CHAMPIONS Prof. Adrian Saville looks to Muhammad Ali for strategies to tackle SA's tough economic times.

P.90

SPEAK TO ME, SING TO ME

Victor Dlamini admires the words and songs of Natalia Molebatsi.

P.23

et cetera

p.02 Contents p.04 Contributors p.08 From the Editor p.10 Network

opinion

p.14 Learning and Change

GIBS Dean Prof. Nicola Kleyn says dealing

with profound change requires constant learning. p.16 The M-suite

Trudi Makhaya gives us the view from the M-suite. p.17 South Africa needs investment

p.18 Caught by Charity

Kerryn Krige motivates for the economic

returns offered by social entrepreneurship

p.40 All Things in Moderation?

Could Dr. Zweli Mkhize emerge as a

moderate compromise to head the ANC?

dialogue For Coke and Country

p.20

Acumen meets Alex Cummings, former CAO at Coca-Cola, now running for Liberia's presidency.

south africa

p.32

Bandwagon Consumption Mignon Reyneke examines new research which sheds fresh insight on SA's black middle class.

p.35

Come Medfly with Me Sarah Wild explains why the weekly release of 56 million destructive fruit flies is saving two key industries.

p.38 Calling Civil Society

and Business

Ex-Dep. Finance Minister Mcebisi Jonas

says SA needs growth and economic transformation.

future p.73 The Green Rush. He (or she)

p.44 Growth, Jobs and Fixing

the Country

GIBS Strategic Foresight lecturer Marius

Oosthuizen says SA needs not one, but

three significant revolutions.

general management

p.58 Why the French Email

by its own

Dan Moyane calls on SA business to invest locally, not offshore.

P.68

P.35

Law Won't Restore Work-Life Balance

Bain & Company's Tiaan Moolman & Michael Mankins say passing laws won't stem the email deluge.

dynamic markets p.60 Dreamer Mawoneke

Accidentally Takes on Coca-Cola

Non-alcoholic drink Breva has become a leader in its segment.

p.62 Beneficiation, Set to Take on

Real Meaning

Godfrey Mutizwa reports on a GIBS MBA

who may have got beneficiation right. p.64 Doing Business In Namibia

Windhoek correspondent Daniel Steinmann

gives an overview of Namibia's

economic prospects. p.68 Eight Things to See & Do

in Namibia

...and then Daniel gives eight personal picks for when the business is done.

entrepreneurship p.70 The First Baron of Bulbine

In this tale of geel katstert, Sean Christie

finds an entrepreneur lurking in

remote Alldays.

Who Dares, Wins.

Futurist Dion Chang examines a new green economy – cannabis.

renew

p.75 Wine

Acumen's wine expert John Maytham

samples the 2015 Porcupine Ridge Merlot,

an Alvi's Drift CVC and the Estate Reserve

from Glenelly. p.76 Rock Solid Travel expert Caroline Hurry visits the

pyramids of Bosnia and the battered,

historic city of Mostar.

p.78 The Finer Things

Fashionista Cheska Stark tells us what to

wear this winter. p.80 Forward Motion

Jacques Marais & Stephen Smith check

out new Hi-Tec trail shoes, and a MTB

helmet from Liv Infinita. p.82

Techno

Techno wizard Aki Anstasiou looks at Samsung's new flagship smartphones and rides something called a Ninebot miniPRO.

p.84 Books

Chris Gibbons reviews Age of Discovery;

Time Talent Energy and a new perspective

on ecommerce in Dynamic Markets from

GIBS' Kerry Chipp.

looking backwards

p.88 Mail Not To Order

Sam Cowen on when algorithms get you

oh so wrong.

4

contributors

MIGNON REYNEKE

is a senior lecturer and marketing /business strategy consultant with experience in the corporate and academic fields, both locally and internationally.

She currently teaches the core marketing course at GIBS and is also involved with custom corporate training in marketing and business strategy.

DAN MOYANE is a seasoned broadcaster with 35 years of experience under his belt, having worked as a news reporter, editor and presenter. His broadcasting credentials include Radio Mozambique’s English Service, BBC, Talk Radio 702, SABC and eNCA. Currently he anchors Morning News Today on eNCA on weekdays from 6 to 9am.

He has been responsible for corporate communication and corporate social investment at MMI Holdings since 2009.

SEAN CHRISTIE is an award-winning South African features writer and essayist who has contributed articles to most of the country's mainstream news publications, mainly on land, environmental, foreign policy, literature and diaspora issues. He recently became the first person to walk the length of Johannesburg's Jukskei River and has written a book about a community of Tanzanian stowaways who live under Cape Town's Nelson Mandela Boulevard.

TRUDI MAKHAYA is

CEO of Makhaya Advisory, an economic and competition policy consultancy. She also writes regularly for Business Day, was previously Deputy Competition Commissioner and a Rhodes Scholar at Oxford where she earned an MBA and a Master’s degree in development economics.

VICTOR DLAMINI

MICHAEL MANKINS is a

GORDON INSTITUTE OF BUSINESS SCIENCE

is a writer, columnist, communicator and portrait photographer with a deep interest in social issues.

He collects art and music, especially jazz. He graduated cum laude in English at the University of Natal in Pietermaritzburg.

partner in Bain & Company's San Francisco office and the former head of the firm's Organisation practice in the Americas. He is the author or co-author of two books and numerous articles in Harvard Business Review and other leading publications.

DION CHANG is an

innovator, creative thinker and visionary. He is a soughtafter trend analyst and, while his feet remain firmly planted on African soil, he uses a global perspective to source new ideas, gauge the zeitgeist and identify cuttingedge trends. He contributes to various print publications and online portals as a freelance journalist and social commentator.

GODFREY MUTIZWA

is a freelance writer based in Johannesburg. He has covered African affairs for more than 30 years across the print and broadcast media working for both regional and international news organisations. Previously, Godfrey was chief editor of CNBC Africa and before that spent a decade at Bloomberg News and Reuters covering African business news.

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6

contributors

KERRYN KRIGE is senior

programme manager for the Network of Social Entrepreneurs at GIBS. She is co-author of the book The Disruptors, social entrepreneurs reinventing business and society.

editor Chris Gibbons Gibbonsc@gibs.co.za cover photography Gareth Jacobs layout and production Contact Media and Communications (Pty) Ltd designer Quinten Tolken

PROF. ADRIAN SAVILLE

GORDON INSTITUTE OF BUSINESS SCIENCE

is Professor of Economics and Competitive Strategy at GIBS, and Chief Strategist at Citadel. He has lectured and taught widely in both South Africa and around the world, has received the Excellence in Teaching Award at GIBS on nine occasions since 2007, and in 2012 was nominated for the Economist Intelligence Unit’s Business Professor of the Year Award. While completing his doctorate in economics, he formed an investment vehicle which became the forerunner to the investment business Cannon Asset Managers, now part of the Peregrine/ Citadel stable.

proofreader Angie Snyman publisher Sean Press Pressman@contactmedia.co.za Contact Media and Communications (Pty) Ltd 011 789 6339 advertising sales Damian Murphy Damian@contactmedia.co.za 082 888 1137

JAMES VAN DEN HEEVER

writes for a range of clients, including the Institute of Directors in Southern Africa, the Ethics Institute of South Africa, the South African Institute of Professional Accountants and Ernst & Young. He was formerly editorin-chief of Systems Relationship Marketing, a custom publisher with blue-chip clients and editor of Computerweek. He also worked as a media liaison in the corporate world.

contributors Aki Anastasiou Cara Bouwer Dion Chang Sean Christie Sam Cowen Victor Dlamini Prof. Ian Goldin Caroline Hurry Prof. Nicola Kleyn Kerryn Krige Trudi Makhaya Michael Mankins Jacques Marais John Maytham Tiaan Moolman Dan Moyane Godfrey Mutizwa Marius Oosthuizen Mignon Reyneke Prof. Adrian Saville Stephen Smith Cheska Stark Daniel Steinmann James van den Heever Sarah Wild commercial director Howard Fox Foxh@gibs.co.za contact Acumen 26 Melville Road, Illovo, Johannesburg P O Box 787602, Sandton, South Africa, 2146 011 771 4000 Acumen@gibs.co.za

Brought to you by:

Disclaimer: Acumen is the official publication of the University of Pretoria’s Gordon Institute of Business Science (GIBS). All material is strictly copyright and all rights are reserved. No portion of this magazine may be reproduced externally, wholly or in part, in any form without the written consent of GIBS. The views and opinions expressed by the contributors to this publication are

SARAH WILD is a freelance

science journalist, specialising in South African science, technology and innovation. She has worked as science editor at Business Day and the Mail & Guardian, and in 2015, she won the CNN-MultiChoice African Journalist of the Year Award for innovation.

not necessarily the views and opinions of the publishers, GIBS or its associates.

While every effort has been taken to ensure the completeness or accuracy of the published information, errors and omissions may occur. The publishers, GIBS and its associates cannot accept responsibility for any loss, damage or inconvenience that may arise from the unauthorised use of this publication.

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8

editor’s note

THE PARADOX OF TIME Words Chris Gibbons

“…today is the slowest day you will know for the rest of your life…”

The quotation comes from the conversation I had with Oxford University’s Professor Ian Goldin, featured in the Dialogue section of this edition of Acumen. Talking about his new book, Age of Discovery, Goldin made the point that not only do we live in a new Renaissance, it’s also a time when our increasingly interconnected existence spins faster and faster.

GORDON INSTITUTE OF BUSINESS SCIENCE

This is an Internet-enabled world in which artists or scientists or anyone else can collaborate on a 24/7 basis with other like-minded creatives or groups of researchers. The potential is seemingly limitless.

Transnet’s Siyabonga Gama and GE’s Jeff Immelt, the subjects, along with Industry 4.0, of our cover story, make the same point, albeit in a different form. Both run massive organisations which are in the process of generating veritable mountains of data. Fitted with sophisticated, new, network-linked controls, a Transnet locomotive or a GE aircraft jet engine reveal more than ever before about their inner workings to the engineers who monitor them – in real time. Theoretically, at least, breakdowns should become a thing of the past and maintenance can be scheduled with pinpoint accuracy.

So why, then, do we also carry a story

by Bain & Company consultants Tiaan Moolman and Michael Mankins, who argue that a new French law compelling firms to stipulate the hours when employees are not allowed to answer emails will fail? Or a review of Mankins’ new book, along with colleague Eric Garton, in which they argue that one of the biggest threats to modern firms is something called ‘organisational drag’?

Organisational drag is something which most of us would be very familiar with: the huge amount of time-wasting ‘stuff ’ generated by the modern corporation – emails, instant messages, meetings.

In fine detail, Mankins and Garton lay out how in a particular company one weekly meeting of senior executives consumed not only 70 000 hours of their presumably expensive time, but also more than 230 000 hours of other employees’ time preparing for the meeting. They report that executives generally spend around half a day a week answering emails that they ought not to have received in the first place.

It seems that this brave, new world has at its heart a potentially fatal paradox: the faster it goes, the quicker it spins and the more data it generates, the more likely it is that the system will gum itself up and creak to an overloaded halt.

Moolman and Mankins’ analysis posits a future in which employees would do nothing at the office but answer irrelevant and time-thieving emails, reserving time at home – supposedly family or relaxation time – for real and important work-related tasks.

Perish the thought!

It’s a danger Ian Goldin is all too aware of when he reminds us that the first Renaissance did not end well, degenerating into intolerance, xenophobia and war.

Unless business leaders and individuals make a conscious choice about how we measure, value and use the limited time at our disposal, we run the risk of squandering it.

Someone at GIBS who is famously busy and a wearer of multiple hats is Professor Adrian Saville, economist and strategist of note. In this edition, he shares with us some of the results of a 19-year long research project that tries to identify which common factors are shared by topperforming companies. He defines these as companies that over a 10-year period have beaten both inflation and GDP growth.

There are not many at all, but Saville reveals the two things they have in common: agility and absorption. Agility means the ability to move fast or to slow down; absorption is about having the resources to withstand tough times as well to take advantage during such periods of other companies’ distress.

His example of a truly great agile absorber? None other than Muhammad Ali – “The Greatest”.

Hard-nosed business analysis by Saville while watching historic fight tapes?

Now that sounds like time well spent!

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10

network

NETWORK Words Acumen Contributors

Acumen Contributors

Kevin Hogan

Ritasha Jethva

Wayne Hendricks

CYBERCRIMINALS INSIDE

GORDON INSTITUTE OF BUSINESS SCIENCE

“Despite all the media and political hype, we simply don’t know who hacked Sony Pictures, or the Democratic National Committee or the Bank of Bangladesh. There is no conclusive forensic evidence. But we do know that a human being opened the door.”

That was the clear warning to a recent GIBS conference on Cybercrime and Risk Management from international keynote speaker Wayne Hendricks, MD and Chief Security Officer of the Macquarie Group, referring to several recent, high-profile cyber attacks. “Our people present the greatest threat,” said the New York-based expert, speaking not only about his own company, but business in general.

Investec Bank’s Fraud Risk Manager, Kevin Hogan, went a step further. “Ninety per cent of cybercrime flows from phishing,” he asserted, referring to the practice used by hackers to tempt unsuspecting users into clicking on email attachments containing malware, or surrendering crucial personal details like bank account PINs.

Hogan explained that we are often the authors of our demise, refusing to change PINs regularly, using the same PIN for multiple accounts and using PINs which are just too easy for hackers to crack.

“A simple eight-lower-case-letter password will take the average hacker about 10 minutes to break,” said Hogan, recommending that we need 15-letter strings using upper and lower case, numerals and symbols, as is now standard at Investec. These need to be changed every six months and we also need to avoid any public Wi-Fi hotspots, like airport lounges, where a single password and user name is used by everyone present. Another vital security precaution, according to Hogan is two-factor authentication, where, for example, a PIN is used as a first step to enter an account, but then the account holder, like a bank, sends an SMS to your cellphone to complete the transaction.

Speakers were unanimous that whilst staff were the cause of most threats, they were also one of the best defensive weapons.

Companies need to “drive specific awareness initiatives across the organisation which are simple and easy to understand,” recommended Ritasha Jethva, Head of IT Risk and Resilience at RMB, and also “to encourage incident identification and reporting.”

network

DIGITAL DISRUPTION IN HIGHER EDUCATION

“Online students have grown by 28%, on-campus education is declining and this is going to continue. The trend is quite clear and is actually going to accelerate,” said Carl Sparks, CEO of Academic Partnerships, a Dallas, Texas-based provider of online education solutions.

Speaking at a recent GIBS Forum, whose audience numbered among others, University of Pretoria Vice-Chancellor and Principal, Prof. Cheryl de la Rey and members of the University Council Lourie Dippenaar and Prof. Russell Loubser, Sparks confirmed that in the US, “More than 60% of MBAs are online now; nursing degrees, education degrees a little bit behind that but still growing. The ubiquity of online for full degrees is accelerating.”

As an example, he cited a smaller Texan university which was showing big growth in students right across the US. “These were students that were never going to go to that campus. They are working, they have jobs, they are teachers, nurses, business professionals, they’re 35-45 years old, they have mortgages, they have kids, they’re not going to quit their job and take out a $100 000 loan to go to a two- or four-year programme on a campus. For this university, probably 30+% of its enrolments are online.”

Prof. Cheryl de la Rey

Sparks was emphatic that this model would also work in South Africa: “This ability to offer price and access right here is a very powerful idea.”

Carl Sparks

Lourie Dippenaar

11

12

network

JOHANNESBURG’S NEW MAYOR AT GIBS

President Zuma’s “careless and self-serving” cabinet reshuffle shows that he and the ANC have lost touch with reality and with South African citizens, Executive Mayor of Johannesburg Herman Mashaba told a recent GIBS Forum. “Instead of leading us to prosperity, they have led us to junk status and into further economic turmoil. We need to be active citizens and not remain silent. We must have the strength to stand up say enough is enough,” Mashaba continued.

He added that the right to trade, work and have human dignity is enshrined in our Constitution. “This cannot happen if we are denied economic opportunities.”

SPATIAL TRANSFORMATION AND A NEW VISION FOR JOHANNESBURG

Mashaba, who was appointed Mayor of Johannesburg last August, said the city has stagnant economic growth and unemployment that is spiralling out of control, whereas it should “be a city of golden opportunity for all our residents.” Economic growth to create jobs and protect the dignity of residents was essential, Mashaba said. He has set a 5% growth target for the city by 2021, as he believes “employment and entrepreneurship are the greatest liberators.” Mashaba said his first proposed budget represents his deep desire to get Johannesburg working. “Our city is plagued by massive inequality which we have to confront head on.” As spatial and income inequality divide the city, a minimum of 60% of capital expenditure would be directed to traditionally poor and underserviced communities. “We must create diverse communities, connected to economic opportunities,” Mashaba said.

.

THE BUDGET IN LEGO AND A TV AD

GORDON INSTITUTE OF BUSINESS SCIENCE

It’s been a busy and creative start to the year for the GIBS TV unit, which has scored two firsts for the business school. At the beginning of February, the team, led by Media and Forums Senior Manager Katie Kilpatrick, shot GIBS’ first-ever TV ad, destined for use on the campus internal network.

Then came the highly unusual decision to report on Finance Minister Pravin Gordhan’s 2017 Budget as a Lego Movie. Enlisting the help of master Lego builder Jason Datnow, the project – designed to make the Budget Speech interesting and accessible – took GIBS Senior Editor Asogaran Shunmoogam and Videographer Michael Walter three weeks to shoot, followed by several hours of frantic voice-over work immediately after the speech.

GIBS Dean, Prof. Nicola Kleyn told HuffPostSA that the reaction was very positive: “It’s tapping into financial literacy, not at a simplistic level at all but in a way that is interesting and engaging and leverages digital learning.”

.

Suffice it to say that GIBS’ Budget Speech Lego Movie has received more than 21 600 views on YouTube

Herman Mashaba

AFRICA’S LEADING MINDS IN ACCOUNTING & FINANCE MEET AT THE CGMA AFRICA INAUGURAL CONFERENCE CIMA, through its Chartered Global Management Accountant (CGMA) designation will this year host the CGMA AFRICA INAUGURAL CONFERENCE 2017 (CAIC 2017) from 20 – 22 September 2017 at the Sandton Convention Centre, Johannesburg, South Africa.

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14

dean's note

LEARNING AND CHANGE Words Professor Nicola Kleyn

Our world order is undergoing profound shifts.

GORDON INSTITUTE OF BUSINESS SCIENCE

Whether we experience political, social, economic or technological tumult from afar or up close, none of us can afford not to engage with the very real hypothesis that the fluctuations herald structural change in the nature of societies, workplaces and lives at large. Of course, change is not new. The events that many suggest were the catalysts of the shifts we feel now started to play out in the last century (for example the fall of the Berlin Wall, the opening of the People’s Republic of China, the rise of the Internet and the introduction of mobile technology).

What I would argue is new, is the extent to which their effects are being felt. What started as weak signals of change have amplified into our daily lives.

Consider the examples of a business deciding not to relocate its global headquarters to the UK because of Brexit, travellers rebooking their plane tickets to the US in order to accommodate their preference to take a laptop on board their flight, or taxi drivers mulling over whether to join Uber or strike against them. Or the dilemma experienced by the head of Human Capital of a large bank trying to reconcile her deep belief that the only way out of a national growth trap is to create employment with the growing body of evidence that tells her that automation will cut her bank’s requirement for employees by at least a third. She is grappling with the shift.

The knowledge worker wondering how to invest in his career to manage the very real risk that his skills set is becoming increasingly irrelevant typifies the shift.

The chances are that if you’re not at least wondering about how these shifts are

going to influence your life, if you’re not already affected by them, you’re deeply out of touch.

Although technological drivers are at the heart what some term the Fourth Industrial Revolution, the level of complexity of the changes and the wide number of interrelated drivers that are at play mean that the notion that we might be able to develop and solve for a single view of the future is naïve. The question rather is how we navigate the changes ahead.

Celebrated scholar Ian Goldin, who features separately in this issue of Acumen, shares a number of invaluable insights in his latest book Age of Discovery, in which he compares the current global era with that of the Renaissance. One of his key messages is to embrace, rather than shy away from, the opportunities this age presents.

Technological disruption has resulted in extraordinary opportunities for digital citizens to engage with each other and collaborate. Embracing our future with an opportunity-focused mindset must take precedence over diving for cover and misguidedly waiting for the storm to pass.

Spotting and leveraging opportunities also calls for a new skills set, one which anyone born in the last century is likely to be lacking. We know that any assumption that our primary, secondary and tertiary studies would set us up for life is void. The words of American writer, Eric Hoffer, that “in times of change, the learners inherit the earth” have never been truer.

Freeing ourselves up from what learning

expert and TED presenter, Eduardo Briceño calls the “performance zone” to regularly enter the “learning zone” means we need to acknowledge the need for unlearning and relearning across individuals, teams and organisations.

The fastest steps will be taken by those who acknowledge their lack of knowing early and set out to engage with multiple, sometimes unexpected sources, to look for answers.

If you believe that someone has developed the perfect curriculum for you to futureproof yourself, you’re wrong. It doesn’t exist. The only way for us to develop the knowledge and skills to move forward in a time of change will be to continue collaborating to explore, define and refine the problems we face. This needs to be followed by rapid experimentation with learning interventions, honest reflections on when, how and why they have worked (or not) before starting the cycle again.

It’s going to be a rocky ride, but if Ian Goldin is right, the unprecedented creativity and innovation that will be unlocked through our relearning cycles will be celebrated by the world for centuries to come

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opinion

THE M-SUITE Words Trudi Makhaya

People who join the M-suite have very different needs, which most modern companies fail to satisfy.

GORDON INSTITUTE OF BUSINESS SCIENCE

As I write this, I have been a member of the M-suite for seven months. In most organisations, the C-suite, in its physical and metaphorical sense, is very visible. In its physical sense, it could be the corner offices of key staffers or the executive dining room. Even in new age organisations, where there are few markers of seniority, the power of senior executives pervades everything. The ‘M’-suite, on the other hand, is a force bubbling under the surface, as working mothers strive for success in the workplace.

The ‘M-suite’ can resemble a war zone at times, as the choices of educated women are scrutinised and eviscerated. Take two American women who are highly visible on the global stage, especially to professional women, and whose choices have inspired heated debate: former US First Lady Michelle Obama and outgoing Yahoo CEO Marissa Mayer. One, when her children were long out of their nappies, decided to step back from her career to become her country’s ‘mom-in-chief ’. The other, at the beginning of her journey as a mother, decided to limit drastically her maternity leave and return to work two weeks after the birth of her children.

Both choices were criticised for taking gender rights and equality in the workplace backwards. Michelle Obama, for being a throwback. Here is a highly educated woman who fails to make full use of the platform that comes with being a modern First Lady. In some minds, she should have emulated Hillary Clinton, finding a big policy initiative to run.

Instead, she chose soft topics like healthy eating and military families, which she

pursued in the background. Marissa Mayer, by taking only a few weeks off after the birth of her children, stood accused of undermining the hard-won rights of the women’s movement. Maternity leave is still rather ungenerous in the United States, and an act that suggests that it is dispensable enraged many activists.

The term ‘mommy wars’ has been dubbed to describe these kinds of debates. They often reveal how women’s choices are still not accepted without judgement. I use international examples because these are the most publicised, with lots of details in the public domain. But the struggle is real everywhere for women who are deciding how to balance life and work. I suspect the reason why women can seem so judgemental of others’ choices is that their own choices often involve a lot of sacrifice and constraint. They may view those pursuing a path that is not available to them, say working from home, as indulgent. Only when the full range of choice is available to all working mothers (and fathers), with institutional support, will those choices go unremarked.

The dominant institutional culture – in companies, government departments and NGOs – still favours presenteeism. Despite technology that allows flexible work arrangements, and management science showing that it is possible to measure people according to their output (and not hours), the culture of face-time largely persists.

As someone running an advisory business and exposed to different client settings, I have seen a range of attitudes towards working mothers (and fathers), as an

outsider though. Some clients have taken the initiative in trying to understand my needs, while others have been less accommodating of, say, my (un)availability around the clock. I have also found that many institutions do not have something as basic as a sanitary and comfortable space for a breastfeeding mother to express milk. Modern mommies are bombarded with public health messages that promote breastmilk, which means expressing milk whilst at work. I took a quick Twitter survey, hardly scientific I know, but over 90% of respondents did not feel that their workplace had adequate facilities to allow for pumping (or, heavens forbid, feeding a live baby).

Society benefits from the talents and contributions of women as mothers and as economically active members. One would think that companies would compete on the quality of their M-suite value proposition. Most institutions have figured out the meal services and the dry-cleaning, but what about egg freezing subsidies (the path to the M-suite can be winding), truly flexible work arrangements and breastfeeding lounges?

.

opinion

17

SOUTH AFRICA NEEDS INVESTMENT

BY ITS OWN Words Dan Moyane

For a long time, South African capital has continued to rush outside for investment.

Despite the recent strengthening of the rand, local companies have continued to ship money abroad at record rates.

Confidence in South Africa has continued to decline but, on the other hand, direct investment by South African companies beyond our borders abroad reached about R70 billion in September 2016 compared to zero in 2012.

So why can’t they adopt the same posture in their own country? After all, we remain the top-performing economy in Africa, with the continent’s best financial services and we are more modern than most other African economies.

Year in, year out, when companies announce their results, they tell us how much capital they have in excess or as buffers. So why are they not investing it in the country but are easily putting it elsewhere?

According to several commentators, the exodus of capital from here started two decades ago, just after the dawn of democracy. It seems that corporate South Africa’s confidence in the country’s economic fortunes began to wane as a new political dispensation was ushered in under the ANC. Low levels of confidence have carried on due to both domestic and international factors, while recent ANC internal squabbles, playing themselves out in government corridors, have made things worse.

Experts and analysts say there is continued nervousness about the domestic economy. Feeding this tension is the credit downgrade to junk, uncertainty surrounding National Treasury leadership and low economic growth prospects.

Investors look to invest where there is growth and, for now, it seems that is outside our country.

But should it be this way? Some of the biggest companies on the JSE, like MTN and Naspers, have shown that you can succeed by investing both in the country and elsewhere in emerging markets, which by their nature do not provide a lot of certainty.

Several companies have what they call an Africa strategy, where they select which countries on the continent to invest in, despite the small size of the market, political uncertainty and low returns.

They say that they take a long-term view and expect returns over time.

So what will it take to reverse the capital flight? My view is that South Africa needs investment by its own companies, if it is to grow and succeed. Why should a foreign entity pour its money into our country if our own corporates are taking their capital elsewhere, faster than they are investing it domestically? If we do not have confidence in ourselves, who will?

While corporate owners can make demands of the political dispensation, they should also table what they would be prepared to invest in. For example, bigger infrastructural programmes, those that can induce growth and create jobs, and as partners with government where it makes sense for the country. The returns will come over time, similar to the so-called Africa strategies that I mentioned earlier.

Business leaders say higher domestic growth would be a good start to change their levels of confidence. But it is important to remember the words of former Finance Minister Pravin Gordhan who stated in April 2016, “Of course, higher growth is not an end in itself. We need growth that yields shared benefits for all in our society, the kind of growth that eliminates inequalities and promotes social cohesion.” It is vital to focus on how to grow inclusivity and not just on a target number.

Gordhan also said, “There is recognition globally that without the private sector, investment growth is a challenge. What we need to create is the ability to grow economies through “more assertive investment programmes”. So working together is the key. Not against one another.

Government alone cannot grow the economy. It also cannot grow levels of confidence alone. South African business must play its part more directly. It is time for corporate South Africa to put South Africa first. That will bring the confidence back into our economy

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CAUGHT BY CHARITY Words Kerryn Krige

Profit – the dirty verb that is transforming South Africa.

Civil society is the cornerstone of developing societies – it provides services that government and business can’t, and strives for equality by flying the flag of social justice. It is the epitome of humanity: these are the organisations that constantly strive to improve and progress the lives of others. It holds our neo-liberal system in check, providing counterpoint to the self-interest that underpins capitalism.

But what if civil society is hurting us?

Inadvertently perpetuating the divides of have and have-nots, the stark lines of difference that define inequality?

GORDON INSTITUTE OF BUSINESS SCIENCE

In South Africa – and in most democratic systems – civil society is funded by benevolence, the age-old concept of charity: alms to the poor. We relegate the funding of our societal progress to corporate social investment mandates, charitable drives and an array of grants from philanthropists and foundations to make things work. It is through generosity that we provide essential services in child protection, hospice care, soup kitchens and homeless shelters.

But the question is who benefits from this act of giving? Is it the recipient – thankful for the funds so that they can deliver their essential service, or the receiver, whose humanity and sense of good citizenship are reaffirmed through the action of giving? The irony in funding social development through the act of benevolence is that it perpetuates that social ill that we are so urgently trying to eradicate in South Africa – inequality. This is because the act of benevolence positions the donor as a have, and the beneficiary as a have-not, reinforcing our perceptions of privilege and fortune.

By creating a system where we allow civil society to do its work through our generosity, we are ironically perpetuating the inequality divide, rather than bridging it. This is something we cannot afford: South Africa’s social development fails are well documented – our leading position on the GINI Index, the rank we shared with Syria on the Human Development Index in 2014, the fizzing demographic of our youth unemployment and its racial plotlines.

And the reality that we cannot continue to ignore is that our social development is imploding our economic growth, as the frustration evidenced in our #hashtag campaigns drives investment uncertainty.

What is required is a refocusing of our attention from that gratitude of benevolence, to the equality and choice that is offered by that most capitalist verb: profit.

SOCIAL ENTREPRENEURSHIP

Our neo-liberal system has two types of organisations – for-profit companies that generate economic value, and not-forprofit companies that generate social value. But what happens when we explore the terrain in between these opposite poles? When we start conjoining the values-driven world of charity, with the profit motive of business?

Profit and social change are poor partners, often associated with exploitation, abuse and manipulation. But when framed against the progressive values of civil society that holds those verbs in check, it becomes a powerful equaliser.

This is the world of social entrepreneurship, which explores the

space between for-and not-for-profit companies, delivering both social and economic value. By introducing profit, the insidious consequences of benevolence are redressed, without compromising the delivery of those essential services that we rely on civil society to provide. And it is a model that is thriving quietly in South Africa – with organisations like the Brien Holden Vision Institute delivering free eye healthcare to rural communities, funded by its development of technology that makes contact lenses work. Through Spark Schools which is re-inventing our concepts of quality and accessible education. And Reel Gardens, the grocery store seed boxes that support food gardens in schools across the country. Social entrepreneurs see opportunity where others see constraint, setting up businesses that take on those issues that we see as neglected, seemingly impossible to fix: our education system, our weakened food security, great healthcare for all, the divides of inequality.

When we stop thinking of social change as the benevolent deed that makes us good people, and instead approach it through the equalising lens of profit, we reframe our view. We move on from the patronising and instead embrace the pragmatic, focusing on the dual environment of social and economic returns offered by social entrepreneurship

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dialogue

GORDON INSTITUTE OF BUSINESS SCIENCE

Alex Cummings

FOR COKE AND COUNTRY Alex Cummings, in conversation with Chris Gibbons

With Trump in the White House as an example, another ex-businessman is running for the presidency of his country. He is Alex Cummings, former Chief Administrative Officer (CAO) at The Coca-Cola Company; he intends to become the next leader of Liberia. Cummings spoke to Acumen during a recent visit to South Africa.

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HOW DID A YOUNG MAN FROM LIBERIA END UP AT THE APEX OF THE MIGHTY COCA-COLA ORGANISATION?

I’ve been incredibly blessed in life, and of course, there is hard work, tenacity, focus. I often say it’s important to be comfortable with yourself, to understand the importance of teams and people and to be able to leverage their skills. All of those characteristics have stood me in good stead to get me from Monrovia, Liberia, to the pinnacle of corporate America. My journey, started with the Pillsbury Company before joining The Coca-Cola Company, and my willingness to relocate and live in multiple locations was important to my success as well. It’s been an incredible journey, one that has been very fulfilling. Came with some sacrifices along the way, but in the end, I was successful, and now hope to translate that to help the people of Liberia.

CLIMBING A BIG, FAMOUS CORPORATE LADDER IS ALWAYS TOUGH, BUT WAS IT MORE SO BECAUSE YOU WERE, FOR WANT OF A BETTER WORD, A ‘DOUBLE-OUTSIDER’? YOU WERE A FOREIGNER AND BLACK?

To be honest, no. Coca-Cola is unique in the sense that it’s very, very broad, very international. To help illustrate that, the past several CEOs have all been non-Americans. We’ve had an Irishman, an Australian and now a Turkish national, which speaks to the fact that the company is quite open to diversity.

Now, along the way, were there situations and cases where perhaps because of the double disadvantage, as you said, it had some impact? The answer is yes. But not in any material way.

IS COKE AN EXCEPTION, OR DOES RACE STILL PLAY A ROLE IN OTHER BOARDROOMS IN AMERICA?

Coke would be a bit of an exception, but remember that back in the mid- to late-nineties, right before I joined, there was a racial discrimination suit in the US that the company settled. In the context of our US business, we learned a lot of hard lessons and vowed never to have that reoccur. Globally we are unique. I think we had, or still have, the most diverse leadership teams in terms of nationality and race.

WHAT WERE THE KEY BUSINESS LESSONS THAT YOU LEARNED ALONG THE WAY?

In no particular order: as I’ve mentioned, the importance of being comfortable with who you are and knowing yourself. Knowing what you’re good at and what you’re not good at. That allows you to hire people that complement you, that bring different skills, that bring diverse thinking. And being comfortable with yourself allows you to hire the best, because you’re not worried that they’re smarter than you or better than you. A second important learning for me early on, was the constant need and desire to keep learning, to never assume that I knew it all. That constancy of curiosity left me in very good stead as I moved up. Third, the need to make choices and prioritise. To not try to do everything because then you do nothing well, and strategy is essentially about choices. Then holding people accountable for delivering what they commit to. Rewarding them, recognising them when they do well, and making sure there are some consequences when they don’t.

YOU ALSO SPEARHEADED THE COCA-COLA AFRICA FOUNDATION, WHICH HAS GRANTED MORE THAN A HUNDRED

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. . . MY WILLINGNESS TO RELOCATE AND LIVE IN MULTIPLE LOCATIONS WAS IMPORTANT TO MY SUCCESS . . . ” MILLION DOLLARS TO VARIOUS PROGRAMMES, INCLUDING ONE FOR HIV/AIDS-AFFECTED WORKERS OF COCA-COLA ACROSS AFRICA?

In fact, I was Group President of Africa when we established the Africa Foundation, and it’s one of my proudest accomplishments and contributions. We at Coca-Cola often said that we don’t lose our humanity when we go to work for Coke or get to the boardroom for Coke, and we believe as part of the culture, the philosophy, that we are part of this world. We have the benefit of controlling a lot of resources globally, and we feel this intense obligation to give back to make the world a better place than when we found it. We’ve got kids and some folks have grandkids, and we want to leave the world better than what we inherited.

That pervades the culture at Coca-Cola. I used to say to my colleagues when I ran Coca-Cola Africa, that shame on us if we have at our disposal the resources of our company and we didn’t give back to Africa's communities and societies.

Oh, by the way, it helps the business as well. It creates a virtuous cycle. You help communities, they improve their economics, they can afford to buy our products, and it creates a virtuous cycle. So, yes, on the one hand, it’s philanthropic and we do it because it’s the right thing, but we also are business people. I make no apologies for running for-profit businesses, and in the long term those efforts help our company grow shareholder value. Increasingly, other global enterprises are beginning to also understand they need to be a part of their communities and society where they live and work.

YOU HAVE RETIRED FROM COCA-COLA BUT I HAVE TO ASK: SUGAR SEEMS TO BE THE NEW TOBACCO. CERTAINLY, COMPANIES LIKE COCA-COLA ARE BEING TARGETED THE WAY BIG TOBACCO WAS 40 YEARS AGO. WHAT ARE YOUR REFLECTIONS ON THAT?

It’s a false and unfair analogy, but that’s life, you can’t always choose who and what people compare you to. We do sell products that have sugar and calories, and as a result, we...I keep saying “we”, although, as you reminded me, I no longer work for the company, it’s been almost a year since I retired...we believe we have been responsible in how we market and sell our products in making sure that we offer products with calories, without calories, with fewer calories. We offer choice and options. We make sure that on all the labelling of our products there is full transparency as to all of the ingredients, including sugar. We also get actively

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I FEEL AN INTENSE OBLIGATION TO GIVE BACK TO LIBERIA . . . ” engaged in and help to encourage healthy, active lifestyles. So we don’t believe the analogy to tobacco is fair or correct.

But we have to deal with that and we’re very open to work with regulators around the world, to make sure they have the facts, and to try to find solutions to the world’s challenges around obesity.

Obesity is a global issue, and we want to be a part of helping the world solve that issue.

The other consideration that most people don’t realise is that governments and regulators are also looking for revenue. And it’s easier to put a donkey on the back of a big company or brand like Coca-Cola to try to drive increased revenues. But the bottom line is we will defend our products, we will share the facts, but we also know we need to be a part of the solution and we will work with civil society, with government, with other businesses, to try to find solutions to these health challenges.

GORDON INSTITUTE OF BUSINESS SCIENCE

NOW YOU’RE RUNNING FOR THE PRESIDENCY OF YOUR NATIVE LAND, LIBERIA. WHY?

I feel an intense obligation to give back to Liberia, and the best way to impact all 4.2 million Liberians is through the presidency.

The golden hope is that ten years from now, we will not be as dependent on this job as the country is today, but the reality is almost everything goes through that office. So if you want to impact the lives of the Liberian people, all of them, that’s the role in which to do it. In some ways, without realising it, I’ve been in training for this role almost my entire life. From growing up in Liberia, the values that were instilled, most of my education is from Liberia. My time at Pillsbury and Coca-Cola and the learnings and mistakes along the way have all prepared me for what this job entails. I’m committed to this effort and want to bring all the resources I have – the skills and relationships – to bear to help to change the plight of the Liberian people.

DO YOU HAVE ANY DIRECT POLITICAL EXPERIENCE?

I do not, in the sense that I have not been in government. Which, actually, I think is a good thing because I often remind our people in Liberia of Einstein’s words: to keep doing the same thing and expect a different result is the definition of insanity. We need to do something different. I offer a very different set of experiences from almost all the other candidates who have been around, have been in government, and look where the country is today.

In business we have to listen to our consumers. They drive our decisions and what we do. Similarly, in government we need to listen to the citizens, the voters. In fact, I would say we need a little more of that than most governments do today. Although I’ve had no direct political experience, actually I think it’s an advantage.

THERE’S A VERY CURRENT EXAMPLE OF ANOTHER BUSINESSMAN WITH NO POLITICAL EXPERIENCE WHO DID SPECTACULARLY WELL IN A MAJOR ELECTION. WHAT WERE YOUR THOUGHTS ON DONALD TRUMP’S ASTONISHING VICTORY AND CAN YOU EMULATE HIS RUN IN LIBERIA?

I think it is a good outcome for me that he won. Somebody challenging the status quo. It’s a good thing and something I would do in Liberia as well. My campaign in Liberia has been, and will continue to be, a positive campaign to appeal to the better instincts of the Liberian people, to paint a better future for them and to try and inspire them to work differently, to engage differently in the transformation of our country.

CAN YOU WIN?

The answer is an emphatic yes and I’m not being naïve or Pollyannaish about it, I’m a hard-nosed, fact-based guy. We started from an almost no name recognition beyond some of the intelligentsia in Liberia, if you will, to where, if the elections were held today, we’d likely do very well. We have until midNovember to work to come in first. So we have a clear path, we know what needs to be done, a lot of hard work, lots of travel throughout Liberia, which is challenging because of the infrastructure, but we’re prepared to do what it takes to make the case to the Liberian people to give us the opportunity to serve them.

A final thought: like what happened in the US, what happened with Brexit, what happened in Ghana, Liberia is no exception.

Most citizens around the world are looking for change, they want something different. The status quo has brought them so far, but in many cases it’s not working, or they don’t see a dramatic change in their lives. This is where we offer the Liberian people very, very different experiences and background, and that I believe gives me a significant advantage versus the other aspirants

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THE RENAISSANCE REBORN Professor Ian Goldin, in conversation with Chris Gibbons

South African Ian Goldin is the Founding Director of Oxford University’s Martin School and its Professor of Globalisation and Development. In a new book with colleague Chris Kutarna, Age of Discovery, they suggest that humanity is living in a golden age.

They draw a very clear parallel with another such golden period – Europe’s Renaissance, which ran roughly between 1450 and 1550.

Ian Goldin spoke to Acumen and began by reminding us of the highlights of that earlier Renaissance.

Professor Ian Goldin

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. . . THE NEW EINSTEINS, SHAKESPEARES, MOZARTS WILL EMERGE FROM THE STREETS OF SOWETO, MUMBAI, SHANGHAI . . . ” The Renaissance was the most extraordinary period in European history. Europe went from being one of the world’s most backward places in the 1450s to by far the most advanced within a 60- to 70-year period. We celebrate it 500 years later as the period that brought us Da Vinci, Michelangelo, Botticelli and many others, but also because it was the period of the most rapid scientific invention.

Copernicus discovered that the earth goes around the sun, not the sun around the earth. The inventions which facilitated the voyages of discovery, the circumnavigation of the globe, the discovery of the Americas and most other parts of the world, except Australia, appeared within that period of time. We moved from a world basically with dragons on a flat earth to a Mercator projection, a round globe.

GORDON INSTITUTE OF BUSINESS SCIENCE

All of this driven by perhaps the most significant of all these inventions: the printing press. We moved from a world where only a tiny fraction – maybe 1% or less of Europe – were literate, where handwritten manuscripts in Latin held by the church dominated information flows, to a world where over 250 million books and millions more political pamphlets were printed in a 50-year period. Suddenly, the cheapening of print and accessibility in people’s own languages led to information revolutions and democratisation of knowledge. This is why you had this flowering of arts and sciences in Europe.

That Renaissance ended in tears: the Bonfire of the Vanities, the burning of books, the hounding of intellectuals, the Inquisition, and religious wars – jihadists led by Savonarola throwing out the Medicis in Florence. Extremism grew, and one of the reasons the period is so interesting, the parallels so compelling, is that tumultuous change was associated not only with extraordinary creativity and beauty, but also with a very rapid rise in extremism, religious wars and with the unintended consequences from globalisation. Such as the killing of most Native Americans through diseases spread by the voyages of discovery.

WHAT IS THE SIMILARITY WITH TODAY?

We live in a golden age, a period which we can define as the second or the new Renaissance. Some would describe it as the Fourth Industrial Revolution, but I think that’s too narrow because it focuses on manufacturing, on processes, on businesses. I see this as a much broader, more rapid period of change, and one with an extraordinary potential to improve the lives of all humans: increase our life expectancy and health, eliminate poverty, and

all the other potentials associated with this; a period of the most rapid change that the world has ever known.

It starts in about 1990. A period of globalisation, of commerce, of ideas spanning the world and transport systems in a way that is similar to the revolutions that happened 500 years ago. But this is global, that was less so. The upside potential is that the creativity, the release of genius that I talk about in Age of Discovery is amplified in this period now because it’s global. Much more significant than it was then.

This new Renaissance is threatened by the same forces of change which led to the collapse of the previous Renaissance. When things change more rapidly, people get left behind more quickly; when things go through tumultuous change, it requires more active worrying about inclusion and the unintended consequences of our discoveries and successes. This current period of extremely rapid change is associated with the walls coming down between societies but going up within them. Inequality is rising and people are getting left behind in virtually all countries of the world. The benefits of this rapid change are being increasingly unevenly distributed, leading to many people feeling that these changes are not helping them. People in the Midwest of the US, for example, who supported Trump, have a lower life expectancy and higher rate of unemployment than their parents did 35 years ago. The same is so of certain parts of the UK. People are rejecting change and saying that the process is one that’s benefiting the big cities and the elite, that it is not benefiting them, and that’s exactly what happened in the Renaissance.

The second big consequence is that when we connect, not only good things connect, but really terrible things connect as well.

With openness and integration comes interdependency and, increasingly, we need to recognise that the spillover impact of our rational decisions can be irrational. We all want to climb the energy curve and that’s fantastic. But without us changing our models we can get dramatic negative, perhaps catastrophic, consequences from climate change. We all want to have access to antibiotics and that is a very good thing. At the same time, as the number of users of antibiotics grows and they’re increasingly fed to animals, antibiotic resistance also grows, and so all our antibiotics might become ineffective when more and more people enjoy them. We all want to have access to wonderful sushi, but this will lead to the extinction of the tuna. So the sum of individual, rational action leads to spillovers and common failures, and that is another sign of interdependency, a sign that we need to think much more about the consequences of the way that we are developing, and worry about those being left out.

SO JUST LIKE DURING THE ORIGINAL EUROPEAN RENAISSANCE, THERE’S A FINE BALANCE BETWEEN EXTRAORDINARY GENIUS AND TERRIFYING RISK?

That is absolutely central. The subtitle of the book is Navigating the Risks and Rewards of Our New Renaissance, which is the central ambition of the book.

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Whether we are going to be able to harvest the benefits of this Renaissance and have this as the best century ever for humanity, a century associated with the elimination of most of the diseases we know, the elimination of poverty and living lives which are in harmony with the planet, or whether this will be one of the most catastrophic, if not the most catastrophic, century. Some would argue it could even be humanity’s final century. That’s really the decision we face and the purpose of the book is to lay this out.

WHAT DO YOU MEAN BY GENIUS?

We simply mean exceptional talent, creativity, and we mean it in a broad sense: the incredible ability to break through barriers, through knowledge, political and other barriers. But we use it in two senses. The one is individual, exceptional creativity, groundbreaking, idea-breaking potential. And there’s just more of that because we believe there’s a random distribution of exceptional people, and we move from a world of only half a billion connected and only about one and a half-billion literate people in the 1980s to a world today of five and a half-billion literate people and six billion moving towards connectivity. So if you believe in a random distribution there’s just a lot more exceptional talent out there and the new Einsteins, Shakespeares, Mozarts will emerge from the streets of Soweto, Mumbai, Shanghai, and elsewhere, and will change our lives.

More significant is the concept we introduce of collective genius.

That’s because we know that what really changes the world and leads to breakthroughs is not actually the individual – although there are individuals that are very significant – it’s teams, people sparking off each other, people who are able to learn very quickly and transform the way others think; diverse teams, particularly, we know lead to major innovations and breakthroughs, which is why diversity is so significant as a driver of innovation.

We know that from the evidence of Silicon Valley and from the psychological and management literature. But this is happening at warp speed in all dimensions. For example, the groups in Oxford working on new cures for cancer are working not only with diverse teams in Oxford but they’re working on a 24-hour research cycle with teams in Mumbai, San Francisco, Shanghai and many other places, with data in the cloud. The nature of their inventions and breakthroughs are very, very different to anything that could have been imagined even 20 years ago, facilitated by connectivity, levels of education, the spreading of these capabilities around the world, sparking off each other.

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The same is happening in the arts and other areas. For example, you can go to YouTube and look at the exchange of YouTube videos between hip-hop dancers in Mumbai and hip-hop dancers in Harlem, Soweto and elsewhere, and see how these people are learning from each other, and that their art forms and capabilities are transforming because they are part of a collective movement of innovation, which is very substantively different to anything that happened before. That’s what we call collective genius.

Smart, interested people, sparking off each other, leading to innovation breakthroughs, and it’s the reason we argue in the book that today is the slowest day you will know for the rest of your life, that the pace of innovation and change is accelerating because of this ideas factory around the world being switched on to a much higher level of engagement and participation.

The important thing to remember is that as much as most of this innovation is for good, there’s also very bad innovation. ISIS, for example, and various jihadists, are an example of how exceptional talent and ability doesn’t only lead to the spreading of good ideas.

It can lead to the spreading of very bad ideas. ISIS is the largest recruiter of foreign fighters since the Spanish Civil War on the basis of social media platforms.

YOU SAY THAT WE NEED TO ‘FIND OUR FLORENCE’, THAT PLACE MATTERS. BUT IF, AS YOU SAY, WE ARE ALL SO INTERCONNECTED 24/7, WHY DOES PLACE STILL MATTER?

Strangely, place matters more than ever. Although you can access information and participate from your home-office wherever, in many activities the world has become more mountainous and spiky in terms of where the action really is, and particularly where jobs are. The history of taking jobs to people has been proved to be an extremely difficult and ineffective way of creating employment and reducing inequalities. The most dynamic places, with the most employment and innovation, are the dynamic cities: the New Yorks, the San Franciscos, the Londons, the Johannesburgs and Cape Towns, and other cities. And if you can’t get to those cities, because you can’t afford the housing, because the transport costs of commuting there are too high, because you’ve got dependants in other places, you can find yourself disconnected from where the jobs are, and increasingly your income and your physical networks fall behind.

That’s one of the reasons we’re seeing this rise in resentment in the US against the coasts and places like Chicago and Atlanta, and in the UK against London. Basically, the people that voted

...TODAY IS THE SLOWEST DAY YOU WILL KNOW FOR THE REST OF YOUR LIFE. . . ”

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that people like Erasmus, for example, created in the realm of ideas. The same thing is happening now. Although we can find out about what’s happening through the Internet, still being in the right place at the right time matters more than ever.

HOW CAN WE MITIGATE THE RISKS ASSOCIATED WITH THIS NEW RENAISSANCE?

There are responsibilities on all of us at different levels. There are actions that individuals, businesses, cities and governments can take. That international collective action by governments working together, with each other or with businesses and others, can take.

GORDON INSTITUTE OF BUSINESS SCIENCE

As individuals, we need to be much more aware of the momentous changes that are happening in the sciences and begin to form views as to what we think about these. We need to be aware of what we’re learning from science. Like the undisputable facts around climate change, around biodiversity loss, around antibiotic resistance, even around the extinction of the tuna. We need to understand that our actions shape the future of the world, and we need to get much more active. We need to ensure that our government does the right thing, and at the city level we need to create communities that are more conducive to the good science, and mitigating the risks. We need to worry much more about those being left behind.

for Brexit in the UK were not the people from the dynamic cities like London, Bristol and a few others. They were the people who felt left behind by change and they can’t get the sort of incomes and access outside the big cities. It’s the same in the US. Only 3% of people in New York voted for Trump. The same is true in places like Boston and San Francisco. Where change is happening, people are embracing it, but where change is not happening and people are being left behind by change, and increasingly the distance between them and the frontier is growing, people are angry and resentful. And they cannot get to where the change is because they cannot afford to, or they don’t want to, and that is a major, major problem. It’s why things like housing markets, transport and health systems and schooling, really matter, because they determine whether you can seize the opportunities of these times or not.

Find your Florence means get to the place that leads you to be most creative. Florence became the absolute magnet for people from across Europe who wanted to be part of the future. The city was 30-40% immigrant, as were other big cities that were changing and part of the transformation, like Amsterdam. In that process, the melting pot is the engine of innovation and change, together with the – then – dissemination through books, pamphlets and other things of the ideas and the feedback loops

We also need to ensure that we pay our taxes and don’t offshore tax monies in our companies or as individuals, because governments need the revenues to pay for inclusive societies.

We need to stamp out corruption wherever we see it, because that is corrosive to creating inclusive societies; it means those with privilege and access can break the rules. As business, I’ve mentioned tax responsibility, but there’s a much wider set of responsibilities, ranging from water and energy use of the business to how one treats one’s citizens. And, of course, moving towards increasingly recognising the inequalities within our own firms, and overcoming them, whether they are gender inequalities or other discrimination.

Cities have a huge role to play. They are the organising actors for most of our lives, and there are many, many things on the energy front, on the water front, on the organisation of transport systems, of housing systems, etc., which are really the domain of cities.

Whatever the challenge is, the answers are different, but we all – at different levels – have responsibility, and whether this turns out to be our best century ever, or our worst, doesn’t depend on some sort of abstract force out there which we have nothing to do with. In the end it’s about how we make it happen or don’t

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https://iangoldin.org/ https://iangoldin.org/books/age-of-discovery/ @ian_goldin

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For those who flew through business class and got stuck into the economy.

If you want a bank that thinks like you do, it’s time to think beyond a bank.

sasfin.com business | wealth | banking

Sasfin Bank Ltd reg. no.: 1951/002280/06.

An authorised financial services provider 23833.

Registered credit provider NCRCP22 and a member of the Sasfin Group.

beyond a bank

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south africa

Siyabonga Gama

GAMA, IMMELT AND INDUSTRY 4.0 GORDON INSTITUTE OF BUSINESS SCIENCE

Words Chris Gibbons

Watched by Public Enterprises Minister Lynne Brown and members of the Transnet board, the giant parastatal’s CEO, Siyabonga Gama, and his counterpart at GE, Jeff Immelt, shared their plan to digitise Africa’s transport sector. A standingroom-only crowd packed into GIBS’ auditorium to hear details of what Gama called “a digital solution that will seamlessly connect shippers and transport operators” and place Transnet at the very heart of the “Fourth Industrial Revolution”, or, as Immelt called it, “the industrial internet – Industry 4.0”.

Jeff Immelt, President and CEO of GE, says he “gets lost on fancy words” and “the way to think about the industrial internet is not in a fancy way.” Instead he prefers descriptions like “no unplanned downtime, fuel efficiency, optimisation of fleet… How do you make assets work better? How do you make enterprise work better?”

For Siyabonga Gama, CEO of South Africa’s largest state-owned enterprise, it’s about “enabling the efficient movement of goods.

This digital platform will enable the industry to be more efficient and competitive, enabling transporters to bring products to market faster and for less cost, across the vast African landscape.”

That’s a landscape notorious for its decaying or non-existent infrastructure, infamous border blockages and delays. Gama understands this and says the platform will take “laborious processes, like payment, customs and inspection, from paper

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HOW DO YOU MAKE ASSETS WORK BETTER?” “the industrial internet – Industry 4.0”. In his view, Immelt estimates this to be a market at least as big as either enterprise or consumer IT and worth roughly $100 billion.

Someone who does make a distinction between Industry 4.0 and the Fourth Industrial Revolution is Jónatan Jacobs, Project Manager in the University of Pretoria’s (UP) Mining Resilience Research Centre. For Jacobs, the former is about the machines and the technology, the latter deals with their impact on people and society and whether or not we have the skills to handle the challenges. Despite alarming predictions about “robotic takeover”, as he puts it, Jacobs says the Fourth Industrial Revolution is not something he fears.

Jeff Immelt

to digital, and create an on-demand solution for transporting freight inspired by consumer on-demand transportation models like Uber and Lyft.

“This will ultimately increase the opportunity for cross-border trade, divisive transportation and logistics across rail, trucks and ships, encouraging seamless integration throughout the supply chain.”

Warning the GIBS audience that industrial companies “need a digital strategy today, it won’t wait,” Immelt made the case in even more basic terms.

“Industrial companies need productivity. It’s really been lagging globally in the last five or six years. It’s really critical in a region like Africa, where there’s only a finite amount of infrastructure, that we find ways to get the maximum amount of productivity out of the infrastructure that we have and the next wave of productivity really has to be found in the digital space,” said Immelt.

He explained that happening concurrently with this craving for productivity was the fact that “the world of technology is changing. The ability to get data off machines, new controls technology, the ability to model that data, is now significant in ways that have never been present before.”

THE INDUSTRIAL INTERNET

These two – “the need and the technology” – have come together at the same time and according to Immelt this is what’s called

“This is subject to the laws of supply and demand. People are driving this because we want the advancement that comes with this sort of technological implementation. We want the benefits that it will bring to us as a society, in terms of improving productivity and working more efficiently.

Jacobs’ area of expertise – mining – is one sector of South Africa’s economy that’s in desperate need of a technology boost. Gold mining, in particular, suffers from some very simple problems which are proving fiendishly difficult to solve. In basic terms, the mines are too deep, it’s too hot for human beings to work at those depths and the rock formations down there are inherently unstable. In other words, it’s just becoming too dangerous. Add in low commodity prices and labour issues that, according to Jacobs, “are not really seen anywhere else,” and “South Africa has major challenges that the rest of the world does not necessarily have in the same context.”

Chamber of Mines SA Vice-President and Sibanye Gold CEO Neal Froneman has warned that mining has about ten years to find technological solutions to these challenges. He notes that South Africa still has about 400-million tonnes of gold ore in the ground as well as an additional 160-million tonnes of high-grade ore locked in underground support pillars. These could be mined profitably using mechanised techniques, Froneman told a news conference at the Investing in African Mining Indaba earlier this year, but if not, then some 200 000 jobs would be lost in the gold sector alone.

From an Industry 4.0 perspective, Jónatan Jacobs explains that a mine is not a great deal different from a factory: “It’s basically in manufacturing, but you just produce rock”. The key questions for the mining industry, he says, are “how do we modernise in terms of technology in the mining environment? How do we bring in these technologies and also empower and assist the people?”

Mechanisation will involve “putting in robotics, having some sort of human interface to interact with with these things, real-time information systems and the ability to do remote mining from the surface,” according to Jacobs, who adds that the timeline

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established by the Chamber of Mines takes the industry to 2025, with an end result of “fully autonomous, remotely operated mines.”

AWASH WITH DATA

Predix is the operating system for GE’s industrial internet, and it’s at the heart of the partnership with Transnet. Once all the data from all the machines and their smart controls has been transmitted and stored, “it can now be modelled to think about fuel performance, wear of the engine, emissions and many different parameters are now coming real time because of the controls,” according to Jeff Immelt.

GE’s Immelt explained to the GIBS audience that “it’s with the controls that are on every locomotive, on every aircraft. If you get on an SAA aircraft and you’re going to fly between Joburg and Cape Town, that engine is going to generate a terabyte of data.”

He repeats: “This is all about no unplanned downtime, fuel efficiency, optimisation of fleet. How do you make assets work better, how do you make enterprise work better?”

One aspect of Industry 4.0 that has only recently started to be understood is that with Jacobs’ “real-time information systems”, also known as “smart controls”, comes a deluge of data.

Those terabytes add up pretty quickly. Head of GE Digital, Bill Ruh, interviewed by strategy+business for their Spring 2017 edition, believes that “the underpinnings of our industrial society will be profoundly changed by 2020. Every form of large-scale machinery will be suffused with sensors and software controls, all more and more interoperable. Increasing productivity, raising profits, eliminating waste, ensuring environmental quality, and improving manufacturing processes will all be automated activities.” Machines manufactured by GE alone will “generate more than a million terabytes of data per day”.

For PwC Partner/Director and Head of Industry 4.0 in South Africa, Pieter Theron, that requires IT infrastructure to carry the data and to store it.

“This is about using communication networks such as current mobile and fixed line networks. How much data can you push over them and at what cost? It’s very expensive to communicate like that,” says Theron. As a result, companies are establishing their own communication networks for Industry 4.0 projects.

“One company that’s doing it for the telcos is Dark Fibre Africa – they put in fibre all across South Africa, which they’re leasing to the likes of MTN, Vodacom, Telkom and other telcos, for example.”

When it comes to storage, Theron says companies like GE will have to have their own infrastructure. “Big companies are investing in cloud infrastructure and somebody like GE will have to build its own data centres. GE’s got a platform called Predix, which is a cloud platform, so GE has to provide the storage and functionality for that platform for companies to be able to use it.”

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PREDIX

Theron says of South Africa’s IT infrastructure, “I don’t think we’re there yet, but it’s definitely happening as we speak.”

Immelt emphasises that small changes matter: “If you took every locomotive in the world and could save 10% on fuel, that small change is probably worth $20, $30, $40 billion of savings to our customers. Small changes drive big outcomes.”

Nor is this a theoretical figure. GE’s Bill Ruh confirms that “for a North American railroad, we enabled a one mile per hour average increase in locomotive performance. For the railroad, that was equal to $200 million in added profit each year.”

In the Transnet context, PwC’s Pieter Theron explains that a system like Predix can monitor locomotives remotely.

“So wherever a locomotive is operating in South Africa, all that information is posted into the Predix cloud. There are applications in that cloud that can predict certain component failures for the locomotive. So instead of having it breakdown between Nowhere and Nothing, Transnet can actually schedule it for repairs or maintenance at the nearest repair centre.”

MACHINES VS. MAN

One thing is clear. Industry 4.0 is going to require a workforce with very different skills.

During the GIBS event, Transnet’s Siyabonga Gama said that at his company, “…we have an environment that is ripe for change in the digital sphere; equally important, we have the people to do so.”

Let’s hope that’s true. Jeff Immelt told the same audience that in the last six or seven years, GE had recruited probably five or ten thousand people – “talent from the tech industry. The leader of our organisation [Bill Ruh] came from Cisco, we’ve got leaders from Oracle, salesforce.com, and we’ve been building what we would call a blended culture where we’re recruiting the best IT talent.”

SMALL CHANGES DRIVE BIG OUTCOMES ”

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Richard Seleka, Lynne Brown, Linda Mabaso

It’s certainly a problem of which the Chamber of Mines is aware.

UP’s Jónatan Jacobs says the mining modernisation process has government backing, with R150 million committed over the next three years, but “one of the themes in terms of successfully transitioning to a more technologically advanced industry is called ‘human factors’. There’s a strong people-centred focus here. How can we, through beneficiation, or the upskilling of the people, use them in other work areas if the existing job specifications are disrupted through Industry 4.0-type applications? Can we for example employ them in manufacturing in order to manufacture the new equipment, components or other devices that will become necessary? Or, how can we beneficiate the rock from gold to jewellery, or electronics and circuit boards? So there is a massive cross-industry systems implication that needs to be assessed when Industry 4.0 comes into play, in any industry.”

As an example of the new skills that are going to be needed, Jacobs cites a fully mechanised platinum mine in the Rustenburg area, which “has a much better skilled and educated labour force…and they are getting some of the best results in the platinum environment due to the mechanisation going on.”

He also points to coal mining, “which has been mechanised for years now, and there are still people working there, still operating the equipment.”

A DELICATE BALANCE

The people problem is one that’s also taxing minds at the Manufacturing Circle, the confederation of South Africa’s largest manufacturers. Its Executive Director, Philippa Rodseth explains that while advanced manufacturing is taking place, “South Africa has a very specific social structure, so the first thing that often arises, or where concern is registered, is what does it do in terms of job creation. Are we going to lose our workforce to robots?”

Rodseth gives two examples of where she thinks manufacturers are using hi-tech appropriately.

“The first is shoe manufacture. There’s some interesting work being done with the dti and the Vaal University of Technology, where they’re looking at the leather and footwear cluster. That’s a very traditional sector, with low-tech products. But what they’re

. . . INSTEAD OF HAVING IT BREAKDOWN BETWEEN NOWHERE AND NOTHING, TRANSNET CAN ACTUALLY SCHEDULE IT FOR REPAIRS . . . ” doing there is shortening the product development cycle because what takes a long time is making and testing the prototypes. The prototypes are then used to make shoes in the traditional way. So there, the system of digitisation – using computer-aided design and 3D printing – means that the prototypes can be made more quickly, so that design and development, which is usually quite laborious, can be shortened. Then the job-rich endeavour in terms of actually making the shoes still takes place.”

Her second example involves machining centres. “In a machining operation, to be able to get the parts out from the machining centre involves a lot of operational health and safety requirements: doors have to be closed, opened, get the parts going, bring them out, make sure you’ve got the right parts, and so on. Using robots in that part of the process, to get the parts out of the machining centre, helps to make production and output more efficient, but you still have labour involved.”

Perhaps the last word should go to GE’s Jeff Immelt, who says “the neat thing” is that software people from both Transnet and GE will work “shoulder-to-shoulder” to develop applications.

He also hopes that Transnet develops applications that can be used around the world, “travelling on Predix, so there might be railroads in the rest of Africa or Latin America using an application that’s going be developed by Transnet.”

.

And that, says Immelt, “is the way the industrial internet is going to go”

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BANDWAGON CONSUMPTION Words Mignon Reyneke

Zanele Mdlekeza

Black consumers have African heart, western individuality South Africa’s ‘Black Diamonds’, or as we term this group nowadays, the black middle class, are far more complex than existing marketing endeavours would lead us to believe. New research tells us they straddle African collectivism and western individuality, effectively throwing marketers a strategic curve ball. This valuable insight into a group which has been written about extensively as a market of untapped potential for brands across Africa – particularly high-end products and services – confirms what many in the world of marketing have been saying for some time: that understanding the black middle class requires getting closer to understanding the drivers and social motivations of this group.

The UCT Unilever Institute of Strategic Marketing has, of course, been studying the black middle class for years; in fact they and TNS Research gave the world the term ‘Black Diamonds’ back in 2007. Using UCT Unilever’s definition, the black middle class is seen as any black African older than 18, either living in a household with an income between R16 000 and R50 000 a month or owning a car, having a tertiary qualification or

currently studying, working in a professional job or living in a city and paying rental of R4 000 or more a month.

That’s a pretty wide definition so, when MBA student Zanele Mdlekeza came to me with a research proposal which aimed to explore the black middle class and how they consume luxury motor vehicles, we knew we were working at the top end of this definition. While the entire group is highly aspirational, the visible consumer impact of having ‘made it’ is most noticeable in those who are already avidly and frequently consuming high-end brands.

Building on a 2011 study by Minas Kastanakis and George Balabanis from ESCP Europe and Cass Business School, London, respectively, Mdlekeza hoped to test their conceptual model in the South African market, specifically with respect to the psychological factors driving black middle class consumers.

Figure 1: Psychological factors associated with bandwagon luxury consumption behaviour (Kastanakis, Balabanis)

INTERDEPENDENT SELF

GORDON INSTITUTE OF BUSINESS SCIENCE

(-)

(+)

CONSUMER'S NEED FOR UNIQUENESS (-)

DEPENDENT SELF

(+)

(-)

STATUS CONSUMPTION (+)

(+)

(-)

CONSUMER SUSCEPTIBILITY TO NORMATIVE INFLUENCE (+)

BANDWAGON LUXURY CONSUMPTION BEHAVIOUR Figure 1

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What the arrows and assumptions represented in the accompanying illustration of the Kastanakis & Balabanis model hold is that a consumer’s desire to fit in (their susceptibility to normative influence), coupled with the status of the purchase, would lead to ‘bandwagon’ buying behaviour.

Bandwagon consumption, according to Ukrainian-born American economist Harvey Leibenstein, refers to a phenomenon whereby “the utility derived from the commodity is enhanced or decreased owing to the fact that others are purchasing and consuming the same commodity”. In other words, consumers ‘hop on the bandwagon’ and seek to own products or follow trends and fads which are prized by others. This makes followers, almost automatically, part of an informal society of sorts.

THEY STRADDLE AFRICAN COLLECTIVISM AND WESTERN INDIVIDUALITY . . . ” What would override this bandwagon tendency would be a consumer’s need for uniqueness. In the western application of the model, which was originally investigated in individualistic London, the influence of the uniqueness factor put a halt to bandwagon behaviour; with these consumers prizing being ‘different’ and, therefore, distinguishable from the crowd.

In the South African context, it was not surprising that Mdlekeza chose to focus on the luxury car market, since these glossy marques are the ultimate sign of upward mobility. The assumption was that the overriding need to be seen as different by those in individualistic communities (in other words, the western setting) would put the brakes on bandwagon buying. But for interdependent-type personalities – like those in collectivist African cultures – uniqueness, it was surmised, would be overridden. So, in the middle class, black South African setting, Mdlekeza and I equally expected this point to have a negative impact. Interestingly, this was not the case. And the big difference came down to the notion of interdependence.

INTERDEPENDENCE MEETS INDEPENDENCE

Mdlekeza conducted an online survey of 184 individuals identified as being black middle class and found that while interdependence certainly did exist, it also came with an element of “I have achieved something, so now I want to be different”.

Influencing psychological factors weren’t solidly collectivist, as you might imagine. Similarly, we found that black middle class individuals were also fiercely independent. Somehow they managed to create a strong balance between the two: independence and individualism on the one hand, and interdependence and community influence on the other.

On deeper reflection, this balance is widely characteristic of those moving into a new social class; individuals who know they have achieved something, are proud of their hard work and want to stand out from the crowd due to their achievements.

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. . . BLACK MIDDLE CLASS INDIVIDUALS WERE ALSO FIERCELY INDEPENDENT ” However, they are still linked to their past and their roots. What Mdlekeza unearthed was a sort of watered-down version of what one might expect; and it showed some western influence impacting traditional African culture.

In his book, Kasinomics: African Informal Economies and the People Who Inhabit Them, author and marketer GG Alcock made this revealing comment: “In South Africa black Africans appear to be modern western sophisticates. The reality, however, is that it is their traditions, not their culture, they are moving away from.

Culture remains with us, an evolving living part of our makeup. Traditional is static and ritualistic. It is a mistake to see an African who on the surface is wearing western accoutrements and to believe they are now western. Africans, like many other strong cultures, modernise, not westernise.”

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He goes on to say: “A major misconception in brand marketing has been that the emerging black middle class is westernising and abandoning their culture. There’s a big difference between modernising and westernising. The success of marketing lies in understanding that culture evolves, yet is retained.”

have made it as ‘ME’, but they also want an indication that they now belong to this ‘CLUB’ and are deserving of all the kudos that go with that.

In her thesis, Mdlekeza arrived at the conclusion that marketers should spend time understanding the psychology of this group, adapting their western-focused international approach to African norms, just as these consumers have done. This calls for less prescriptive communication and advertising, and the skilful use of celebrity endorsements mixed with opportunities to customise products to create uniqueness.

This goes as far as the workshop floor, Mdlekeza observed.

“Marketers should make their luxury motor vehicles customisable so that consumers can choose a combination of features that give uniqueness to the motor vehicle. Extending product lines to create exclusive ranges, e.g. limited editions and concept models, could address the need for uniqueness through creative choice or avoidance of similarity,” she wrote.

As Alcock notes, many marketers – be they in academics or on the ground – have chosen to assume, because it is easier to do so, that African cultures are more collectivist, and that the individuals who inhabit this world are too. But no. This research confirms observations, like those made by Alcock above, that South African brands need to consider and appreciate that these prized consumers are multilayered and multifaceted and should be approached and communicated to with the same degree of dynamism.

In practice, unravelling the best approach for talking to and understanding the black middle class consumer is far more complicated that one might initially think, and it is a topic which both Mdlekeza and I believe warrants further qualitative and quantitative study. This work opens up additional questions as to how the same model might play out in the Indian, coloured and white populations in South Africa. Are they equally influenced by their exposure to African culture? Other questions which have been posed to me include whether black middle class buyers factor in whether cars were manufactured in South Africa, and how deep the international model pull is.

Purely independent people don’t need external validation, whereas black middle class consumers do; and marketers need to be very clear on that fact. Take luxury vehicle advertising. With this information at hand a luxury vehicle manufacturer in South Africa would be ill-advised to only highlight a successful young executive in a marketing campaign. Certainly, it is advisable to focus on a successful black professional in an expensive suit driving a shiny car, but do add in a girlfriend or a wife and possibly kids, because family is important to the black middle class. Once you’ve done that, then you need to offer an indication of the pride and approval such a purchase will engender from the broader community. Yes, these consumers want to show that they

While Mdlekeza’s thesis examined luxury car brands as a whole, the BMW brand features highly in the study. For a dominant marque like BMW, inclusion in such a study also holds another important gem: South Africa’s black middle class consumers are deep and critical thinkers, they want to know why they react to luxury brands in the way they do. For any brand, such inquisitiveness is both a blessing and a curse. You have to stay on your toes, live up to your brand promises and ensure that you nurture your consumers and their perception and experience of your brand. The pay-offs, from a luxury, brand-savvy, group perspective, of fostering this level of understanding are significant and long term

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COME MEDFLY WITH ME Words Sarah Wild

Every week, 56 million fruit flies are purposefully released over South Africa. That is more fruit flies than there are people in the country. Although fruit flies usually spell disaster for fruit growers, in this case they are indispensable.

These are a special kind of fruit fly for two reasons.

First, they are one of the most invasive and potentially destructive pests for the fruit and wine industry. The adult flies lay their eggs under the skin of fruit, and when the eggs hatch the larvae eat their way out of the fruit, ruining it.

The presence of the Mediterranean fruit fly, otherwise known as Ceratitis capitata or simply the medfly, on export fruit is enough

to have a country’s export license revoked in some regions: because they are so invasive, regions do not want even one fruit fly to find its way into their markets. It was originally from the areas around the Mediterranean, but has since spread to the United States, South America, sub-Saharan Africa and even Australia.

The second reason that these released flies are special is that they are all male and are all sterile. These flies are a key tool in controlling the medfly in South Africa.

PHOTO: SCOTT BAUER, U.S. DEPARTMENT OF AGRICULTURE [PUBLIC DOMAIN], VIA WIKIMEDIA COMMONS

Medfly insect

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“The medfly is a serious agricultural pest,” says Matthew Addison, crop protection manager at Hortgro Science. “It is very widespread and able to attack a large number of hosts, [which] include a number of fruit and vegetable crops.”

These crops include grapes, apples, pears, plums, peaches and cherries – a large proportion of which South Africa exports. The medfly is considered an international quarantine pest, and so fruit requires special treatment if it is being sent to a medfly- free country.

FLIES AND JOBS

Fruit is a major source of revenue and employment in South Africa. Deciduous fruit, which includes stone fruit but excludes wine grapes, had an annual turnover of R10.48 billion in 2015, according to industry body Hortgro, and employed about 108 400 people, who supported 433 600 dependants. With 42% of deciduous fruit being exported, the medfly is a serious threat to the national income and employment that this industry provides.

The same holds true for the wine industry: almost 1.5-million tonnes of grapes were produced in 2015 to make the country’s famous wines. This results in an industry with an annual turnover of about R4.8 billion, according to the South African Wine Industry Statistics. All of this could be jeopardised by a fly that is slightly smaller than your average housefly.

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The possible damage caused by these flies is three-fold, says Dr. Chris Weldon, who heads up the Flies of Economic Significance Research Group at the University of Pretoria. “They infest and damage a wide range of fruit, including economically valuable citrus and deciduous fruit, their control in the field or after harvest involves a range of expensive techniques, and their presence in exported fruit can lead to rejection by the importing country. They are also found in very high numbers in the prime fruit producing areas of the Western Cape,” he says.

This is where FruitFly Africa comes in: FruitFly Africa is a not-forprofit company owned by the fruit industry and the Agricultural Research Council (ARC), and jointly funded by industry and the Department of Agriculture, Forestry and Fisheries. It has a facility in Stellenbosch which is dedicated to rearing fruit flies, sterilising males and releasing them into the wild.

Nando Baard, manager at FruitFly Africa, says that they service about 45 000ha, which includes large tracts of the Western Cape – in places such as Tulbagh, Elgin, Vyeboom, among others – Langkloof in the Eastern Cape, and Orange River in the Northern Cape.

NUKE ‘EM!

The sterile insect programme – which involves bombarding male fruit flies with high energy radiation – began more than two decades ago, says Brian Barnes, a retired employee of the ARC.

“The International Atomic Energy Agency (IAEA) were actually the ones who cast the first dice,” he says. “They contacted South Africa [in about 1996], knowing we had this fruit fly, and asked if South Africa would collaborate with them in a feasibility study in an attempt to suppress the fruit fly,” Barnes says.

This technique has now been used in many countries around the world, from Argentina to Israel to Australia.

The aim of the IAEA’s technology is to “sterilise mass-reared insects so that, while they remain sexually competitive, they cannot produce offspring”, the organisation says. The IAEA is quick to note that this process does not involve genetic engineering or modification, which would involve altering the DNA of the flies.

It all begins with sex selection. “The organism is sensitive to temperature,” Barnes explains. “They found that by heating the male and female eggs at [between] 30°C and 32°C, that’s enough to kill the female, but not the male.”

About a fifth of the eggs are not treated, and females go back into the mass-reared colony to continue producing the next generation of eggs. But the ones that have been heat-treated are all male.

When bombarded by gamma radiation, the male medflies become sterile and when they mate with females in the wild, they cannot produce offspring. “The insects are distributed weekly in high numbers to growers for release, FruitFly Africa says. “These sterile males then mate with the females in the wild population, resulting in infertile eggs, causing the wild population to decline over time. This forms part of a long-term strategy that, if supported by effective usage of other fruit fly management tools, can keep populations at low levels in a cost-effective manner without harming the environment.”

SURVIVOR

A major reason for the medfly’s invasiveness is that it is highly adaptable. Research by the University of Pretoria’s Weldon “shows that medflies are quite tolerant of dry conditions because they lose water from their body slowly and are able to metabolise stored body fat to replace water that they have lost”, he says.

“Other research I am currently conducting suggests that populations of medflies in different climate zones of South Africa have evolved to become locally adapted to the temperatures and levels of water stress that they experience,” Weldon says.

All players – from government to industry to academia – see FruitFly Africa’s programme as vital to the country’s agricultural industry.

But some say that more sterile medflies need to be released.

Weldon notes: “The method relies on wild medfly populations being greatly outnumbered by the released sterile males, so that there is a high chance that wild females mate with sterile males leading to infertile eggs and no offspring.”

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To achieve this, many sterile males need to be released into the wild – the more, the better.

“FruitFly Africa is constantly looking for ways to improve their sterile male production and effectively cover treated areas, including the development of aerial releases of sterile males from a gyroplane,” says Weldon, who is not involved in FruitFly Africa.

Baard, the manager at FruitFly Africa, emphasises that their production facility is not working at full capacity. “We have the capacity to produce 80-million sterile flies per week [which is 24 million more than they are releasing at the moment], so expansion of the programme using the current facility will be easy.”

PEOPLE

However, there are some issues that even a deluge of sterile medflies will not fix.

“One factor that is out of their control is the continuous movement of fruit among sterile-insect technique treated production areas by the general public,” Weldon notes.

“This provides a constant source of new wild medflies into treated areas from surrounding regions, which reduces the effectiveness [of this technique].”

This is why releasing large numbers of sterile males in winter is the easiest and most costeffective way to control medfly populations.

“Their lifecycle becomes longer [in winter] and population levels drop,” FruitFly Africa says. “If enough of the preventative- and control-techniques are applied in these areas during the winter, population levels can be driven down to extremely low numbers.

A female medfly pumps eggs through her ovipositor into the soft outer layers of a ripe coffee berry

With so much at stake – from jobs to foreign revenue – this programme is only one of the ways that authorities contain the medfly menace. Addison from Hortgro points out that this sterile-insect technique forms part of an integrated approach to medfly management, such as baiting and monitoring.

This costs producers between R122 and R1 500 per planted hectare per year, depending on what services are used, Baard says.

Hortgro’s Addison notes that there are a number of local pests that this technique can be applied to. The codling moth, a pest that attacks apples and pears, was the focus of a sterilisation programme, “but did not get beyond pilot phase due to cost”, he says. “False codling moth – a pest on citrus and a number of fruit and vegetable crops – is another. The citrus industry has established a false codling moth sterile-insect technique programme in Citrusdal in the Western Cape…

But despite the success of the sterile-insect technique, FruitFly Africa currently has no plans to extend this programme to other agricultural pests.

“A great amount of research has been done on sterile-insect technique and it is successfully being used worldwide on a variety of insects,” Addison says

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PHOTO: SCOTT BAUER, U.S. DEPARTMENT OF AGRICULTURE [PUBLIC DOMAIN], VIA WIKIMEDIA COMMONS

“The population level after winter translates into how high population levels are likely to be during the summer months, which is harvest time.”

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Mcebisi Jonas

CALLING CIVIL SOCIETY AND BUSINESS Words James van den Heever

GORDON INSTITUTE OF BUSINESS SCIENCE

Growth and a fundamental restructuring of the economy are what the country needs – and urgently. That was the view given to a recent GIBS Ethics and Governance Think Tank by Mcebisi Jonas, at that point still Deputy Minister of Finance. But an active and engaged citizenry would be needed to drive the process.

Ordinarily, deputy ministers of finance would be barely known by the public, the classic backroom technocrats playing a largely unrecognised role. But, as we all know, this is no normal society, and South Africa’s then-Deputy Minister of Finance, Mcebesi Jonas, has the highest of profiles thanks to his reported refusal of a R600-million bribe to take on the top job in Finance as the Gupta point man.

importance, and the power, of courageous leadership.

Unethical behaviour is contagious but so, Pogrund points out, is ethical behaviour.

The former Deputy Minister Jonas and his boss, Pravin Gordhan, have both been accorded rock-star status as bastions against the tide of state capture currently threatening to engulf the bodies politic and economic.

The central one was the need to focus on growth while transforming the structure of the economy.

Introducing Jonas, Gideon Pogrund, who runs the Think Tank, made the telling point that moral truths are most persuasively conveyed in action. Leaders like Jonas were demonstrating the

During his brief introductory remarks and a subsequent dialogue with 702’s Stephen Grootes, Jonas returned again and again to several interrelated themes.

Jonas argued that growth – the creation of new wealth and assets – is the prerequisite for a radical transformation of the economy.

At present, he said, we are simply redistributing what is there, thus confusing rent-seeking with true economic transformation.

The latter would mean economic participation for the masses

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and, for it to occur (and this is the point that is made all too seldom), the economy needs to be grown substantially.

DECOLONISE THE SUPPLY CHAIN

In a striking phrase, uttered with his trademark jocularity, Jonas suggested that we need to “decolonise the supply chain”, by letting in new entrants. An Eastern Cape man, he recalled how the numerous small engineering companies supplying the motor industry in the region did not survive the globalisation process.

Somehow, that strong base of smaller businesses – they need not even be black, he hinted – needs to be reconstituted across many industries to ignite growth from the bottom up.

In Jonas’s analysis, rent-seeking is more than just the antithesis of growth, it is the fountain of corruption. Because a rent-seeking or redistributive mindset acts as a brake on growth, the economic goods remain insufficient, leading to a win-at-all-costs mentality.

We need, then, to move beyond pointing fingers – “It’s not useful”, he says – to deciding how to change the economy to drive both growth and transformation.

Jonas emphasised several times the dangers of adopting a populist approach to economic transformation and growth, ostensibly a reference to the EFF but also, one could not help inferring, his own party. Keeping the fiscus on an even keel while trying to address pervasive and systemic inequality raises “real issues that you can’t deal with in a populist way. You have to be very careful,” he said.

In the context of growth, he said the low rate of infrastructure investment is a cause for concern. The solution here would be to reverse the trust deficit between business and government that palpably exists.

Clearly, a very different conception of radical economic transformation than that of President Zuma or, indeed, the EFF and similar fringe groups like Black Land First.

To ignite growth and transformation, we need to agree on a model – a process that will necessarily involve trade-offs – and then make a start on implementing it. The need is urgent given the high levels of impatience manifest in the country.

ALLONS, CITOYENS!

Here, though, some problems arise. They are most evident when we consider two of Jonas’s other key themes: the need for, and value of, an active, alert citizenry, and good leaders.

The leadership question is the nexus of the problem. South Africa has always been blessed with excellent leaders, especially at times of need – something we saw in the lead-up to 1994.

Indeed, we have good leaders in politics, civil society and business today, Jonas said. But just who they actually are was, conspicuously, something that Jonas skipped over, particularly in the all-important political realm. This is not surprising, given the pressure he is under, but it is the key issue because it is the ruling party that holds the power, and it should be the one to provide the catalytic leadership needed to pull such a process together.

It’s time, in other words, to consider the inter-factional dynamics of the ANC.

At the time of the GIBS Forum, Jonas was part of the Treasury team and his views were very much on message – as a quick reread of the Budget Speech shows. In that speech, then-Minister Gordhan also explicitly linked growth and transformation: “With transformation, we will see growth. Growth will strengthen the forces of transformation.”1 Like his boss, too, Jonas advocates greater co-operation between government and business, and a cleverer use of state-owned entities, as important levers of growth and transformation.

But Jonas and Gordhan are part of the Gwede Mantashe faction of the ANC, in opposition to Jacob Zuma’s dominant faction.

Prince Mashele, the prominent political analyst, unpicks the dynamics with his usual laser-like incisiveness. “Some people are in power, some are not in power – that’s the nature of politics at the moment,” he says. Put simply, the Mantashe faction is the one that is not in power.

Furthermore, Mashele says, Jonas is not a person of influence in the ANC in his own right. His influence was entirely dependent on his position as a deputy minister.

Jonas, Gordhan and the rest of that faction are thus speaking from a position of weakness. As a result, they are not really in a position to offer the catalytic leadership needed or to provide the necessary powerful sponsorship for their vision of growth/ transformation. And, Mashele says, it will certainly not come from the Zuma camp. The in-power Zuma faction sees no benefit in genuine economic transformation and growth – only potential disruption of its carefully constructed web of influence and power. It will certainly not allow the out-of-power faction to enter the tent via the back door of an economic Codesa, or similar process.

“It will not happen,” Mashele says flatly.

(Incidentally, the Zuma faction’s thought process reminds us that unethical conduct is not only contagious, it also blinkers those who practice it. They literally cannot see beyond their most narrow interests.)

If this analysis is correct – and it certainly seems to be – then the real reason for Jonas’s repeated references to the need for an active and alert citizenry becomes clear. In the absence of galvanising political leadership, it is civil society, and business too, that will have to play that role, and essentially force the issue.

This observation returns us, rather neatly, to where we started, with Gideon Pogrund’s observation about the contagion of ethical leadership. I think what Jonas was intimating was that while his actions may have sparked the chain reaction, decisive support is needed from all of us.

Maybe it is time for us South Africans to abandon our addiction to ready-made leaders and, to adapt Ghandi’s phrase, become the leaders we want to have. If that happens, Jonas’s example will truly have set in motion something great

Minister Pravin Gordhan: 2017 Budget Speech, http://www.gov.za/speeches/minister-pravin-gordhan-2017-budget-speech-22-feb-2017-0000.

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ALL THINGS IN MODERATION? Words Cara Bouwer

If the outcome of the recent Dutch general election is any indication, there is life still left in moderate politics. Factions within the governing ANC should take note and keep watch on a man some have tipped for greater things: Dr. Zweli Mkhize.

Populism and nationalism were driving forces behind the UK’s Brexit and the Trump presidency in the US. Indeed, both continue to inform rhetoric, particularly in nations like France, Germany, Poland and Hungary. But in South Africa, where the EFF already provides a radical voice, could a moderate lead the ANC out of trouble? Currently ANC Treasurer General and a member of the ANC NEC ‘Top Six’, Mkhize is a medical doctor by education and former KwaZulu-Natal premier. Calm, reasonable and, in large part reassuring, he answered all questions put to him during a recent GIBS Forum, although, with typical political aplomb, some were addressed less directly than others.

GORDON INSTITUTE OF BUSINESS SCIENCE

This is hardly surprising, says independent political analyst Ralph Mathekga. “He is a moderate, a reasonable moderate.” Ironically, these are traits which “could actually work against him within the ANC, as extremism and rhetoric seems to be more important than substance”.

During the discussion, Mkhize spoke extensively about the economy and poor growth. However, his words offered little new direction, rather following the ANC’s policy documents, which were released on 12 March and which largely echo the six-year-old National Development Plan (NDP). A theme which Mkhize visited regularly was the need for greater trust between government and the private sector, although he did take the opportunity to slap business on the wrist, saying: “It is South African business that must also show confidence in their own economy.”

It was to be expected that Mkhize would speak of radical economic transformation while admitting that action was being foiled by external – and internal – pressures. He noted that inequality was a global concern, but said: “In South Africa we do have a problem of being very narrow and we need to find a way of reducing the concentrated ownership and try to bring in more and more players into the economy.”

He was adamant that, two decades into democracy, those black professionals who had earned their stripes now needed to be pushed to the forefront of the economy. “What about all the skills that have been growing in the various sectors? Now it needs to move on and show a change in the patterns of control and ownership,” said Mkhize. “It’s not just about the politics, it is about stabilising the economy of the country.”

OVER TO YOU

Of course, a booming economy still requires support from investors and when asked what proposals were on the table to make South Africa more attractive to investment, Mkhize punted the ball right back at the largely business-centric audience. “It is something we need to work on collectively as South Africans,” he said. “It cannot be an issue which only one side can deal with…

In the last year there has been a lot more interaction which has made it possible for government and the private sector to identify and try to solve some of the thorny issues, amongst them the issue of labour reforms. I would say it is a good opener for business, labour and government to be working together. Then, when you go out, you can sell the country’s attractiveness on the basis of one story.”

But what, beyond the focus on black industrialists and reiterating the tenets of the NDP, “will trigger that investment?”, probed forum chair, GIBS Professor Nick Binedell.

And there – beyond an agreement that economic growth was needed to drive transformation – the overarching sentiment seemed to be that much still needed to be done. Even Mkhize’s reference to platinum group metals beneficiation efforts – in collaboration with Impala Platinum – seemed a long way off.

While a 16-hectare Special Economic Zone in Springs has been earmarked for fuel cell development, a land feasibility study was only completed at end-2016.

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From youth unemployment to skills development, building small businesses, addressing lacklustre performance by state-owned enterprises, and increasing business with Africa, Mkhize stuck to the approved script. This came as no surprise to Mathekga.

“He is to some extent a technocrat, a pragmatist. Except for a few bad decisions, or indecisions (the ‘three amigos’ corruption case) during his tenure as premier, he usually stays out of controversy.”

The ‘amigos’ case involved provincial government corruption and fraud in connection with fixing hospital tenders.

Mkhize was, however, vocal about the South African Social Security Agency (SASSA) social grants crisis, which was unfolding in the Constitutional Court during the week in question. “I would say that that kind of technology on which the social grants are distributed...government must find a way to negotiate taking over that...then you can open up the rest for efficient and competitive bidding,” he said.

“Why didn’t you?” asked Binedell.

“That’s a good question,” replied Mkhize. “A lot of focus is going into the issue, so we should be able to find out what happened.

I believe the creation of SASSA itself meant that it would be the repository of the technology, and the personnel that would assist in the process.” He added: “I think all of us have been watching the SASSA story, and most worrying for everyone is the fact that this is a very sensitive area of social safety net that assists a lot of people, particularly poor people... Linked to that is the whole issue of improved service delivery.”

It wasn’t an all-out condemnation of the handling of the SASSANet 1 contract fiasco, but a gentle criticism. It’s a stance he also took the day before the Forum when he told Business Day newspaper that the Constitution should not be changed to allow for land expropriation.

. . . IT IS A GOOD OPENER FOR BUSINESS, LABOUR AND GOVERNMENT TO BE WORKING TOGETHER” While comments around SASSA and land reform appear to position him outside President Jacob Zuma’s camp, they are interesting given the current rhetoric coming out of the ANC and the party’s attempts to appease disillusioned voters. Mathekga said: “His resistance to attacks [against] the Constitution might

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result in some [ANC] youth league members concluding that he is part of the establishment, read ‘white monopoly capital’.”

SPACE FOR MODERATION?

However, some might argue that – politics aside – South Africa may well need moderate leaders to help unite the country. In this respect Mathekga feels media speculation by the likes of Daily Maverick and Huffington Post that Mkhize may be the dark horse in the succession race, may not entirely be without merit.

CALM, REASONABLE AND, IN LARGE PART REASSURING . . . ” “He comes across as a reasonable man, which means he could attract assistance,” said the analyst.

But drill down into Mkhize’s network and influence and Mathekga feels he is unlikely to have the clout to take on either Cyril Ramaphosa or Nkosazana Dlamini-Zuma. “It won’t work well for him to antagonise either one, all he has to do is to position himself as a number two for either camp... He could fit very well in Dlamini-Zuma’s presidency and could earn her some legitimacy. He also fits well in Ramaphosa’s camp because he could assist it to fend off disgruntlement of the group that would have lost out if Ramaphosa succeeds.”

Certainly, Mathekga’s view that “key stakeholders in our economy would be more willing to work with him”, is vitally important if the ANC is to create the trust which Mkhize emphasised. “This will then get him to build alliances between private sector and labour in a way that results in less resistance to his policies, although they would be ANC policies,” said Mathekga.

Despite the keen interest in the ANC succession, Mkhize would not be drawn on the issue at GIBS, beyond saying: “The party is going through a lot of issues which it has to face, among those are issues of what we have seen as decline in some areas of support, especially in major cities, and therefore it raises a number of issues of what needs to be fixed within the party... The issues of fighting corruption and good governance are also very important.”

How the ANC faces these problems could determine the party’s future, particularly when given a question like this during the GIBS Forum: “Why should we as young professionals vote for another 25 years of the ANC since, up to this point, your ability to deliver has been poor and your ability to hold leaders to account has been poor?”

That was one of the questions Mkhize chose to skirt

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advertorial

sefa: INTUITIVE FINANCING FOR EXPONENTIAL GROWTH

Thakhani Makhuvha, CEO of sefa

advertorial

In the 2017 Budget Speech, then-Minister of Finance, Pravin Gordhan noted that, “Transformation must unleash growth, establish a new economic direction, mobilise investment, empower the masses and create new resources for social change.”

The minister’s vision has been realised by the agents of this transformation, not least of all being Thakhani Makhuvha, the CEO of sefa and his innovative team dedicated to being catalyst for growth of the SMMEs.

THE HISTORY OF sefa

The Small Enterprise Finance Agency was founded five years ago, by amalgamating Khula Finance Enterprise, SAMAF (South African Micro-Finance Apex Fund) and the small business loan book of the IDC. The benefits of forming sefa are being seen on many levels and felt by an increasing number of small to mediumsized enterprises. “Last year, we supported a little less than 55 000 small businesses and co-ops, creating 75 000 employment opportunities, largely in the informal sector,” Makhuvha states, “We are committed to increasing our footprint in all the provinces and industry sectors to give access to finance targeted at young people, women, rural businesses and people with disabilities. In total over the past four years, we have assisted 198 000 SMMEs and created, on average 202 000 jobs. This is our contribution so far to goverment’s 2030 plan of job creation and economic transformation.”

PARTNERSHIPS AND DIRECT LENDING

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that SMMEs and co-ops in South Africa face. The agency is comprised of a structured finance team to address the capital needs of each applicant on a personalised basis. Added to that is a team of 130 discipline-specific mentors that walk alongside successful candidates and add strategic value to the businesses, lowering the default risk on the loans. Apart from the mandatory mentoring and advice, the agency also has a post-investment monitoring department to constantly improve the way funding is made available, and to investigate ways of including disruptive technology in their offerings.

The application procedure requires candidates to submit a business plan that is stress tested to evaluate viability within the macro and micro influences of the sector in which that business is operating. This includes the regulatory compliance documentation of tax clearance certificates and CIPC registration documentation. Included in the application, the entrepreneur or key person in the business, must undergo behavioural scoring and individual assessment.

“Unlike most lenders,” Makhuvha explains, “we are governed by the National Credit Regulator but we do not require an owner’s contribution or collateral to be attached in the terms of the loan. Thus we require that the entrepreneur goes through our processes which give us a better understanding of how to support the individual and the business.”

Using key partnerships with SEDA, the National Treasury and the dti (the Department of Trade and Industry), sefa has developed a parallel lending model that not only utilises intermediaries but does direct lending to businesses that meet the agency’s lending criteria. Within its first year of being in operation, sefa managed to reach twice the number of businesses than its predecessor.

This is because of adding to the portfolio of lending models, a direct model that caters for bridging finance as well as term loans.

UNDERSTANDING THE NATURE OF SMMEs

The agency has even created specialised channels of lending to those with disabilities. Amavulandlela scheme is a financing product that offers direct lending to those who qualify at an interest rate of 7%, which is far below the average of any other traditional credit provider.

These structures are put in place to counteract the high failure rate of small and medium-size enterprises and are aligned with the government priority of supporting entrepreneurial activity in a tangible manner. “At sefa we support the 30% set aside by government in the 2030 plan to develop SMMEs initiatives in every government department, as well as creating centralised financing. We believe in collaborations on the ground and within parastatal institutions and intermediaries. We have learned some valuable lessons since our inception and we keep evolving to best serve the saviours of our economy,” states Makhuvha

“We have a higher risk appetite,” says Makhuvha, “we invest in sectors that traditional channels view as too risky. This includes the informal trading markets like spaza shops and fresh produce markets, such as those in the east of Johannesburg, and city-centre Durban and Mangaung. We have invested in a wide range of sectors, from funeral services to agri-processing, some directly and others through strategic partnerships with stakeholders. A working example of this is our partnership with the SA Taxi Association, where we provide bridging finance to support entrepreneurs starting and scaling businesses in the transport industry.”

BEYOND FINANCING TOWARDS REAL INVESTMENT

The innovative approach to finance has a multilayered intervention process that tackles the various challenges

sefa, in the last five years, has clearly understood the intricacies and challenges of starting and running a business in today’s economy and has taken up the responsibility of addressing cash flow issues by reducing the turnaround time on required financing. After receiving credit committee approval , the agency aims to provide quick turnaround times on term and bridging loans. The agency also offers a capital holiday of three to four months, subject to the nature of the business.

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012 748 9600 www.sefa.org.za Eco Fusion 5 Block D 1004 Teak Close Witch Hazel Avenue Eco Park, Centurion

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GROWTH, JOBS AND FIXING THE COUNTRY Words Marius Oosthuizen

How can South Africa harness key competitive advantages in a way that grows the economic pie for everyone?

GORDON INSTITUTE OF BUSINESS SCIENCE

Gauteng alone boasts robust finance, real estate and business services sectors, lubricating the myriad factories and construction outfits that rely on the transport, logistics and communications networks embedded in the old Witwatersrand and surrounds. Similarly, KwaZulu-Natal, the North West and Free State each have economic competencies like port management and irrigation-based agriculture, that can be harnessed to increase agro-processing for export. What seems to be missing from our public discourse on the economy though is a big-picture view of how these diverse capabilities in all our provinces can be leveraged to fulfil a role in a grand, national re-industrialisation project. Such thinking requires long-term strategic perspective – an intellectual asset which seems sorely missing.

The policy discourse has of late been flip-flopping between the populist ideological ideas of “radical economic transformation” on the one hand and “stabilisation to boost investor confidence” on the other. These catchy phrases may make the headlines but have little by way of substance in relation to the structural changes needed in the economy. Even higher investment rates, which are sorely needed, will have only an incremental impact on employment rates. South Africa does need an economic revolution, but not in the form currently being contemplated.

THE TRIPLE REVOLUTION

In essence, there are three revolutionary changes needed to save South Africa from self-imposed stagnation and uncompetitiveness. These will create jobs for the poorly skilled

masses and no, they do not involve expropriation of land without compensation nor the decimation of our property rights. Quite the contrary, the revolution South Africa desperately needs is a feeding frenzy of economic productivity and opportunity.

First and foremost, an energy revolution is required, not as a centrally planned state-owned megalith, but rather as a tapestry of productive clusters mushrooming around the country. The so-called energy mix sought by the Department of Energy must be seen more as a guiding light than a policy constraint. We need renewable energy entrepreneurs and hydrogen energy pioneers and micro-energy innovators to make South Africa an energy supernova on a largely dark continent. The Southern African Power Pool (SAPP) network, through which Eskom exports bulk electricity to our SADC neighbours is a foundation to build on and a blueprint for how our excess capacity can drive market development north of our borders. Small players, across the energy value chain from production, to component manufacturing, to wholesale and retail, must be unleashed to follow suit. In this view, the Independent Power Producer (IPP) project at the DBSA (Development Bank of SA) becomes a strategic incubator rather than a threat to the Eskom monopoly.

Secondly, we need an education revolution, but not as an isolationist “education system” pipe dream, where the state pumps billions in taxpayer rand into a black hole of inefficiency.

No, this education Renaissance must take the form of embedded and fast-tracked skills development. IT giant EOH's Youth Internship initiative is a good start and provides an interesting

PHOTO: SHUTTERSTOCK IMAGES

South Africa has a diversified, open economy with deep competencies in key sectors such as mining, automotive and chemicals manufacturing among others. More recently, a Silicon Valley in embryo has begun to emerge in and around Stellenbosch, driven by hipster IT gurus who have spawned interesting fintech start-ups. One is now our third-largest bank, Capitec. Although mining has come under pressure and is increasingly politicised and while only a handful of large new manufacturing segments continue to thrive, South Africa is light years ahead of any African neighbour in economic diversification. This competitive foothold will not last forever, with Kenya recently receiving their first inward investment in auto manufacturing and Nigeria following suit. South Africa has to urgently harness our competitive advantages and do so in a way that grows the economic pie in a more inclusive manner.

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quality of their market competitiveness. No, the manufacturing revolution we are describing requires a targeted approach which unpacks the value chain of sectors and surfaces the key investments needed to undercut the competition abroad by innovating on production processes, harnessing local conditions and inputs in novel ways to get better products to market faster, at better quality and higher value. An example is the way in which SATaxi, a South African transport financing champion, is refurbishing Toyota minivans locally at a fraction of the cost through a bootstrapped, in-house production process – one with which imports simply cannot compete.

LEGACY AND THE FUTURE

model for how corporate South Africa can get stuck into the challenge of turning our excess low-skilled labour into an army of designers, artisans, factory workers and innovators. The Partners for Possibility model which partners CEOs and school principals as learning companions on an executive leadership programme is another innovative social entrepreneurship model. The key is to leverage excellence in one area, such as our listed corporate champions, to upskill and fast track growth in another – in this case, our languishing education sector. Why should the state play principal and teacher to our kids in a world where learning and information have become ubiquitous? A platform-based business model for just-in-time training has to eclipse the old paradigm of education, a “bucket system” where poorly trained, poorly paid and de-motivated teachers disperse their limited knowledge to disengaged and overcrowded classes of learners. Instead, the new model of open-source, semi-structured, facilitated learning should be used to form a pipeline of critical skills for the economy.

PHOTOS: SHUTTERSTOCK IMAGES

Between our industry needs and government programmes there is a synergy to be unlocked to make South Africa a net exporter of homegrown, skilled Africans, from which we will benefit domestically. Expats have a role to play in building linkages between South Africa and the world. If we in time create an oversupply of skilled and experienced talent, we should view skilled migration as a benefit, not a threat.

Thirdly, and critically, we need a manufacturing revolution, where we turn from a defensive “Proudly South African” posture to an innovative but hard-nosed “Made in South Africa for the World” posture. This does not mean using short-termism and protectionism to expand inherently uncompetitive industries without long-term sustainability. Spending another R2.5 billion through the dti to create a mere 12 500 jobs in automotive when the industry is under threat and shedding jobs due to automation, is a costly misalignment of resources. Our entire manufacturing value chain needs to be streamlined for competitiveness.

Nor does it mean “protecting” entire sectors under the guise of “strategic minerals” for instance, without an appreciation for the

As South Africa emerged from being a pre-colonial tribal outback, marred and scarred first by colonial exploitation and then by apartheid oppression, the confluence of capacity and know-how produced world-class South African Breweries, SASOL, and the like. Only, these firms largely served narrow interests, seeing the population as a labour market or market for goods. As South Africans, that is our legacy but does not have to be our future. We have to innovate again and build again and pioneer once more, but this time in an inclusive manner. This requires a new model of partnership between old and former enemies. Labour, for one, in this model is not an antagonistic player but a critical partner. Capital, in this model, far from being a necessary evil in the view of labour, is a vital necessity – perhaps the first required for productive growth.

An industrialisation path which harnesses our innate and hardwon capabilities to broaden our diversification and deepen our current nodes of expertise is the way to do so. Robotics and automation pose a risk to this vision but far from implying simply that the idea should be abandoned, it makes the case all the more that education, in STEM (science, technology, engineering and mathematics) as well as programming, should form part of the matrix that conceptually guides the endeavour. We may need to make friends, for different purposes, with the Germans and the French and the British and the Americans and the Chinese and Koreans to draw on their sophistication to help get us there.

We may need to reset relations with our African neighbours to develop beneficial trade relations in the long term. But the first thing we should do, before looking abroad, is to take stock of what we have to work with, and start there, together, as South Africans

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THE QUEST FOR THE ADVENTURE DOLLAR Words & Photographs Jacques Marais

GORDON INSTITUTE OF BUSINESS SCIENCE

South Africa is emerging as a leading international destination for adventure tourists. The boom in adventure events has seen extreme sport becoming a major money earner for role players in this segment of the outdoor industry. Acumen meets some of these key adventurists.

Ernest Henry Shackleton, born in 1874 in Kilkea, County Kildare, was arguably the greatest adventurer who ever lived. Following on a career as a young merchant officer with the Royal Navy, he yearned for more adventure and eventually managed to procure a position as third officer on the ship Discovery.

In 1901, Shackleton set off on his first foray into Polar waters and then, more than a decade later, he was deemed ready to lead his own expedition. This was the fateful Imperial Trans-Antarctic Expedition on which his ship Endurance was crushed by pack ice, compelling the crew to undertake a journey that to this day is thought to have been impossible.

Shackleton and his crew navigated more than 850 miles through a tempestuous South-Atlantic Ocean in tiny lifeboats to South Georgia Island. He then continued his treacherous journey on foot, and eventually managed to save every single crew member. Alfred Lansing recounts this incredible saga in his book Endurance, a must-read for every adventurer out there.

A good century later, the face of adventure is vastly changed.

Unlike Shackleton, contemporary explorers have cutting-edge gear to support them on their quests, with satellite phones, GPS receivers and technical apparel – not to mention aerial support and rescue craft – making their modern-day expedition way more achievable.

There are some aspects which have not changed much, however.

Shackleton needed funding to finance his expeditions, as do modern-day explorers. A successful expedition also often leads to fame and (occasionally) corresponding fortune and, again, this holds true in the modern age.

Which brings us to the ‘adventure dollar’ … You can search for it as a present-day adventurer; or create events where competitors become your adventure collateral; or build a company that dispenses ready-made endorphins for all those jaded nine-tofivers in search of meaning.

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R20.9 billion. This equals a potential income of R4 billion from adventure tourism alone, and that’s not to be sneezed at.

With this in mind, we spoke to three individuals and organisations who have made adventure their business. These are their views...

“For scientific leadership, give me Scott; for swift & efficient travel, Amundsen; but when you are in a hopeless situation, when there seems to be no way out, get down on your knees and pray for Shackleton” – Sir Raymond Priestly

THE ADVENTURE COMPANY: GRAVITY ADVENTURES WEBSITE: WWW.GRAVITY.CO.ZA

Gravity Adventures is owned by Andrew and Marie-Louise Kellett, and their main business activities focus on high-quality adventure activities for small groups. This encompasses a range of options, from wilderness rafting and sea-kayak trips, to group adventures for schools and corporates.

Based in Claremont, their micro-adventures and expeditions are run from Cape Town, but with Orange River rafting operations based in Onseepkans in the Northern Cape. A beachfront property in Langebaan on the Cape West Coast offers easy access to their sea-kayak outings.

“Cape Town is increasingly seen as an ‘event city’, and although we don’t benefit directly from any specific event, a general increase in clients interested in micro-adventures near town has enabled us to grow this sector of our business,” says Marie-Louise Kellett. Gravity is however well known for creating small-group bespoke adventures.

Here’s what makes them tick, in the words of Marie-Louise Kellett...

Top left: An athlete negotiates the cliffs beyond Bloukrans River during the annual Otter African Trail Run.

According to a research report by Johan Radcliffe – CEO of Dirty Boots, a leading South African company specialising in the marketing of guided adventure activities – this market segment is largely underdeveloped locally. “Countries like New Zealand, Canada and even Saudi Arabia are leaps and bounds ahead of us, but as far as the pure potential of outdoor adventure goes, we are untouched here at the tip of Africa.

“Internationally, the definition for adventure travel is a trip that includes physical activity (with the potential of an element of risk), interaction with nature, or also cultural experiences. When using this description, 26% of all tourists qualify as adventure travellers, although locally we still separate cultural tours and safaris,” Radcliffe continues.

This becomes interesting when extrapolating figures correlating with our SA Domestic Tourism Index (Jul-Sept 2016), showing Foreign Tourist Arrivals (2.4 million), Domestic Tourist Trips (4.5 million) and a combined Foreign and Domestic Spend of

Below: Andrew Kellett steers a SUP board into False Bay.

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“We have a very small, multidisciplined core team: Andrew Kellett heads up logistics, training and operations; Marie-Louise deals with sales, marketing, as well as industry and environmental issues (vital to the bigger picture); while Sonja Petersen heads up operations. Additional staff are subcontracted as needed for each event, with a strong pool of freelance guides and support staff who regularly work with us.

GORDON INSTITUTE OF BUSINESS SCIENCE

“Marketing and promotion is done through a combination of word of mouth (referrals are very important) and social media, mainly via Facebook. Editorial coverage is also effective.

“Tangible benefits we offer clients are firstly based on Gravity being one of the pioneers in the SA adventure scene (we’ve been around for 20 years!) From the word go, we were clear on key issues: professionalism, well-trained and well-paid guides, quality equipment, well-maintained vehicles and gear that can be trusted. In addition, we try to push hard around issues relating to social and environmental responsibility, and do not mind charging marginally more to supply the best possible service.

“The reason we do this? Our philosophy is ‘work hard, have fun, be kind’ and we think this applies to both work and home life. If we can live this ethos, we believe we will then grow as individuals.

This means our business will have a positive effect on our staff, our clients, the natural places we operate in and on the industry we are in.”

THE ADVENTURE EVENT: OTTER AFRICAN TRAIL RUN WEBSITE: WWW.THEOTTER.CO.ZA

The Otter African Trail Run, presented by Salomon, is organised and co-ordinated by Magnetic South, one of South Africa’s premier event staging companies. Key operational crew includes the Collins brothers – Mark and John – and their respective wives, Belen and Christine.

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Top and bottom left: Gravity Adventures offers any number of aquatic and landbased adventures, including coasteering, river rafting and sea kayaking.

Top and bottom right: International BUFF athlete, Emma Roca, exits from the Bloukrans crossing during the Otter African Trail Run; competitors face 42km of treacherous trail at this world-class event.

Magnetic South Productions is based on the Garden Route in the southern Cape, and presents several additional events, including the Featherbed Trail Run, Trail Town Festival, and the Phantom Trail Run. According to Mark Collins, preparations for each individual event can take months, if you do it properly...

“Actually, Otter takes a full year. Booking the trail must be made a year in advance and staff need to plan for leave. We engage a total team of 70 people and all staff deployed along the trail (including medical and media) must be trail runners with a high degree of mobility and outdoorsmanship. The team managing the Bloukraans crossing must be competent in surf and swift water rescue.

“International athletes who compete every year insist that the Otter compares with – or even surpasses – leading global trail running events. Part reason for this is the environmental ethics of our organisation: we truly believe we set the bar in terms of managing the environmental footprint here in SA, and arguably abroad, too.

“We feel traditional editorial content in mainstream media is still highly regarded by sponsors and participants. Social media, because of ease of access, personalised target orientation and instant saleability, is often hyped as being the way forward, but it does come with clutter and is fleeting. Too often one event looks

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pretty much like any other on social media, and getting real value requires a clear strategy and consistent message.

“The Otter is that ‘perfect storm’ between a marathon-distance event and impeccably poised trail running terrain. This makes for the ultimate pure trail challenge, with a pristine coastline, technically demanding, yet balanced trail, and unpredictable natural obstacles that all morph in a place of magical natural

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“One of the comments I get at conferences is, ‘Wow, being a professional adventurer must be so amazing!’ I immediately get this image of Bear Grylls triumphantly returning home after conquering everything: square-jawed and formidable, he hands his wife flowers, his children crowd around, and they all live happily ever after. Brilliant, right?

THE ADVENTURE PERSONALITY: PETER VAN KETS WEBSITE: WWW.PETERVANKETS.COM

Peter van Kets is a contemporary adventurer – in the mould of Shackleton – who is consistently in search of new boundaries, both mental and physical. He is currently planning a bold series of new adventures with Beyond Expeditions. Peter is also an ambassador for Children in the Wilderness and the Sustainable Seas Trust – he is based in East London, Eastern Cape.

GORDON INSTITUTE OF BUSINESS SCIENCE

As a professional extreme adventurer, Peter has survived and thrived in some the harshest environments on the planet. As such, he has become a sought-after international business and inspirational speaker and bestselling author, but deems being a father as the most important role in life. Lessons learned during extreme expeditions are related to a business environment, taking elements of survival, courage, perseverance, passion and tenacity, to take people on a powerful and life-altering journey.

What is it that really drives Peter van Kets?

“Adventure and exploration is my business and must be managed as such; as with any other career, it is vulnerable to economic and political turbulence. Every venture or expedition I embark on demands a clear vision and purpose, a dynamic strategy, precise planning and preparation, absolute honesty, integrity, a passionate support team, self-discipline and, above all, perseverance.

“Organising an expedition is like starting a new business venture.

Years of experience means I’ve come up with a universal process that really works for me and it also means I do not have to reinvent the wheel each time.

“There are two types of expeditions: the world firsts, generally long-distance epics and often hugely expensive. These are bundled with many unknown variables and therefore take much longer, because planning and preparation have to be meticulous.

Secondly, you have shorter (and often more local) expeditions, aimed at achievable and more immediate results. These are a lot easier to organise and can take anything from 6-8 months, while the premium expeditions take approximately two years to come to fruition.

PHOTO: GARTH HAM

beauty in the Garden Route National Park. All in all, the Otter proves as much a test of dexterity as of endurance. The challenge to move efficiently and fast over difficult terrain has always fascinated us.”

“Yes, my choice of career is amazing, and it’s everything I’ve ever dreamed about and more. It’s the reason I get up every day and it makes me feel alive, but (and I know you’ve been waiting for that), as with all other careers and businesses, this comes at a dear price, one that outweighs many benefits.

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PHOTO: BRAAM MALHERBE

“I have found that – again, just like in business – the most critical part of the preparation is to surround yourself with the best team of people possible. Every individual must share the same vision and purpose as you, and ultimately, it’s not about me, but rather about the team as a whole. The television documentary of my solo row across the Atlantic was called Not Alone, as a tribute to my team of associates, and especially my beautiful wife, Kim, an extreme adventurer in her own right”

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ADVENTURE TOURISM FACTS AND FIGURES Domestic Tourist Trips 4.5 million Foreign Tourist Arrivals 2.4 million Total Direct Domestic Spend R3.5 billion Total Foreign Direct Spend R17.4 billion Domestic Bed Nights 18.2 million Foreign Bed Nights 19.5 million Stats: Jul-Sep 2016 source: SA TOURISM INDEX Report 3rd Quarter 2016

Bottom left: Peter van Kets and Arno van der Merwe crossing the Namibian desert on one of their expeditions.

Top and bottom right: Global adventurer Peter van Kets 7km from the South Pole and 20km from Antigua during the gruelling Woodvale Atlantic Rowing Race.

Total Number of Adventures Booked 11 million Annual Income Generated by Adventure Operators R4.6 billion The Average Age of An Adventure Tourist 35 years Number of People employed in the Adventure Tourism Industry 25 000 + Stats: 2014 source: DIRTY BOOTS Report (2014) – www.dirtyboots.co.za

PHOTO: BILL GODFREY

Top left: Adrenalin sells, and athletes are wont to spend tens of thousands of rand on event entries, technical equipment and travel arrangements in order to bag the bragging rights to premier races.

GORDON INSTITUTE OF BUSINESS SCIENCE

general management

HEAVYWEIGHT CHAMPIONS Words Prof. Adrian Saville

It was four in the morning, the date, October 30, 1974. Banks of white-hot lights cut through Kinshasa’s steamy night air, illuminating the square ring. Some 60 000 fans were packed into the stadium and many millions more were in front of their TV sets or in movie theatres around the world.

“The Rumble in the Jungle” was about to unfold, a classic showdown between the reigning Heavyweight Champion of the World, 25-year-old George Foreman, and his 32-year-old challenger, former champion and now veteran, Muhammad Ali. Heavily muscled “Big George” was unbeaten in his 40 fights, 37 won by knockout. Pound for pound, pundits rated him as perhaps the most devastating puncher boxing had ever seen. The bookmakers had him as clear favourite: although Ali in his prime had won many of his fights through sheer athleticism and agility, it was highly unlikely the older man would be able to absorb Foreman’s fearsome firepower.

So what does this have to do with business? Read on...

PHOTO: STR/AFP/GETTY IMAGES

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First, just like in the heavily hyped run-up to a world heavyweight title bout, we need to set the scene. South Africa is in the grip of tough economic circumstances and has been for a while. How bad is it? Well, an easy way to capture economic performance, or the lack thereof, is to look at per capita income changes. The ‘tale of the tape’ is that we have been in a per capita income recession for a number of years. If you compare the performance of per capita income over the course of the Zuma administration to the halcyon days of President Mbeki, it pales in comparison. In fact, to find economic performance as poor as this, we need to return to the dying days of the apartheid regime under Botha and de Klerk, when per capita incomes had been in recession for the best part of a decade. To put some numbers to it, per capita income growth under the Mbeki administration ran at about 2.5% a year, while under Zuma it has been flatlining at 0%. If it were a real fight, the ref would have stopped it by now – or Zuma’s corner would have thrown in the towel!

For overall GDP growth, 2016 looks like it delivered a meagre 0.3%. Allowing for an improvement in commodity prices, an end to the drought in most provinces and energy stability, 2017 might be 1.0%-1.5% better. Yes, that’s an improvement but it’s hardly robust. In turn, even if this better GDP growth transpires, once we adjust for population growth of 1.7%, 2017 looks like it will add a year to South Africa’s aggregate growth in per capita income of 0% over eight years to extend it to a nine-year run.

So how should businesses that find themselves appearing in this tough economic ring prepare for the big fight that almost certainly lies ahead?

ESCAPE VELOCITY

Well, just like the storied boxing trainers of yore – Angelo Dundee, in Muhammad Ali’s case in Zaire1 – we need to study the records.

For a man like Dundee, that would have involved watching and analysing tapes and films of his charge’s next opponent. In my case, my colleagues and I have been watching a set of more than 2 000 companies over nearly 20 years and analysing their competitive strategy and resultant performance. A key element of this work was to help us establish if there were common attributes or elements of identifiable behaviour or business DNA that allowed these companies to achieve what we call escape velocity.

Escape velocity doesn’t mean that these firms have immunity to economic circumstance. But it gives them buoyancy and a record that stands out relative to their industry and economic peers.

The way we identify these businesses is through their ability to achieve top- and bottom-line business growth, ahead of inflation and economic growth. Inflation, because it’s a nominal number – if you have 5% inflation and the company has grown by 5%, the company hasn’t actually grown. And we put economic growth into the mix for the same reason – because if the economy has grown 2% and the company has grown 2%, then the company has really just been treading water in terms of economic market share. Our metric to measure true business performance is to say a company needs to be growing faster than both inflation and economic growth and it needs to do that in an uninterrupted fashion. These are companies with escape velocity.

Zaire in 1974, now the Democratic Republic of Congo

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Notably, what we found is that many of these businesses are not the ‘usual suspects’ that feature in the narrative around South African champions. That’s a story which often emphasises that such companies have to be big and global. Naspers, Richemont, and Shoprite are great cases in point. However, whilst these are remarkable businesses, there is a different set of companies that have evidentially even more impressive business performance with at least 10 years – and sometimes more than 15 years – of uninterrupted top- and bottom-line growth.

IF IT WERE A REAL FIGHT, THE REF WOULD HAVE STOPPED IT BY NOW – OR ZUMA’S CORNER WOULD HAVE THROWN IN THE TOWEL” This cluster, which has achieved escape velocity in the South African landscape, include EOH, the services and technology group; insurer Clientèle Life; Aspen Pharmacare, one of the ‘obvious giants’; Famous Brands, which looks after the likes of Wimpy, Mugg & Bean, Steers, Debonairs Pizza and many more; and the Imperial Group, which for a period stood out with extraordinary performance. In the construction sector, head and shoulders above its peers is Wilson Bayly Holmes-Ovcon (WBHO); in banking, it is Investec and Capitec; and in consumer services and retail, Mr Price, Truworths, Shoprite and Bidvest.

Key to note is that if you look at the recent performance of some of these businesses, it’s evident that a couple have stuttered.

For instance, WBHO has fallen onto difficult times relative to its 20-year track record. Notwithstanding that, its performance remains well above the industry. Mr Price has recently delivered disappointing numbers, but that’s on the back of 15 extraordinary years. The critical point is that remarkable businesses can hit tough times – and in the worst instances lose their way – and that achieved success for a period doesn’t mean that a business is assured of success in all times.

Research in the US by Columbia Business School Professor Rita McGrath (see box) has identified a similar, very small, very eclectic cluster of unusual companies that have achieved escape velocity.

If it’s eclectic and very small, then that leaves us with a curiosity: despite their eclectic cosmetic appearance, do they perhaps have anything in common?

The answer is a simple – but resounding – “yes”. In every one of these businesses we find common behaviour and similarity in business elements. And this is where Muhammad Ali re-enters the ring. For the sake of illustration and argument, I have clustered

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NOT JUST IN SA

Having flagged the South African companies and identified many of them as being “unusual suspects”, there is a lovely resonance with international research done on the same subject by Professor Rita McGrath of Columbia Business School in New York. In fact, our research was developed off her model. McGrath’s question started with exactly the same premise: there are some businesses that have achieved uninterrupted performance. Who are they?

McGrath identified from a set of 5 000 companies that for businesses to be able to achieve this uninterrupted top- and bottom-line growth is overwhelmingly a minority sport. She started with a survey period that covered just five years. She was staggered that so few businesses could do five years in a row without interruption. And so she went to a different five years and found an almost identical result: in both five-year surveys it was fewer than 10% of companies that could do five years in a row with uninterrupted performance.

That led her to a third question: are there any of these businesses that have done ten years in a row, five years and five years back-to-back of uninterrupted growth? Remember that these 5 000 companies surveyed by McGrath have large market valuations and many are billion-dollar businesses.

But of the 5 000 companies she surveyed, just ten companies had done ten years in a row without interruption to their top- and bottom-line growth.

GORDON INSTITUTE OF BUSINESS SCIENCE

It’s significant that those companies are as “unusual suspects” as the South African set. They include Yahoo! Japan; HDFC, which is an Indian bank; FactSet, which is the US-based financial data company; Infosys, the Indian systems business; ACS, a Spanish construction firm; Tsingtao, the Chinese brewer; and Krka, which is a Slovenian pharmaceutical business.

these elements into two broad features. The one is referred to as agility and the other is absorption, both of which Ali showed on that fateful night in Kinshasa in 1974.

AGILITY AND ABSORPTION

Agility references the ability of a business to be innovative, to change its speed, to invent or to reinvent, to re-engineer. Changing speed is not just going faster; sometimes, indeed, it can be actually going slower. Absorption means elements which give a company the ability to withstand tough times, as we’re in now. And the absorptive elements are not just about taking punches. Absorption is also being able to come off the ropes and throw the knockout punch when the time is right.

But can we turn words into action? It’s all good and well to say, from a competitive perspective, our strategic imperative is to be agile and absorptive. But you can’t rush back to the office or the plant and tell people, “Guys, gloves on, we’re going to be agile and absorptive!” There needs to be a practical, implementable element.

So how do we construct an agile absorber with escape velocity?

How do we train our companies to become like Ali during the “Rumble in the Jungle”?

In no particular order, some of the key elements of Agility include: AVOID DETAILED STRATEGIC PLANS

These companies constantly change their minds and often in the moment. They are rapid adaptors and willing adopters. Mr Price is a good example. Think of where the company started historically – Sheet Street – and where it is today. Although the way their stores and systems might be invented and proprietary, they’re not the first people to retail clothing, sportswear or homeware.

In fact, their environment is highly competitive and extremely consumer sensitive. This suggests a lot is learnt from others and borrowed from the industry, but implemented in more innovative or efficient ways.

CONSTANT INNOVATION AT EVERY LEVEL

Investec is a good example. Many of the businesses that make up Investec have been crafted inside the company rather than acquired. This is about giving people running room to establish, engineer and build. In classroom language it’s called ‘intrapreneurship’. They build innovation at every level of the operation and in everyday activity.

. . . DID THIS INVESTMENT TRANSLATE INTO CASH IN THE BANK?”

PHOTO: AFP/GETTY IMAGES

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PROXIMITY AND ENGAGEMENT

SHIFTING TO ABSORPTION

WBHO shows the way in this practice. Their project managers stay on site, they are proximate and engaged, they’ve got eyes on the game and feet on the ground. Their processes support speed and they support flexibility. Also, they diversify their portfolios, so that, often, when they find something that works well they will pursue that great idea. But they won’t establish that pursuit through a grand idea, fire a cannon ball and hope it hits a target.

Instead they create lots of small bets, when they find something that works they then develop that idea after proof of concept and they repeat ideas that work well.

Remember that it’s not just about taking punches…agile absorbers, companies with escape velocity, recognise that tough times come but that’s also when opportunities appear.

MANY SMALL BETS AND DIVERSIFIED PORTFOLIOS

Famous Brands is probably our best example of this, with EOH sitting alongside. They’re bottom-up businesses that listen carefully to their customers. The classroom language is ‘customer-centricity’. Clientèle Life would also be a great example of developing products that aren’t built in the boardroom: their products are instead built and based on customer need and customer knowledge.

FEDERAL STRUCTURES & OWNER MINDSET

If you are customer-centric it promotes customer stability through federal structures. So although there is a central control, risktaking and risk management sit in the federation. Imperial is a lovely example of such a federal structure, this is a group that has been built in the fullness of time through acquisition as much as organic growth. Those acquisitions overwhelmingly have been small. If one of them doesn’t do well, it doesn’t come with the risk of pulling the business over. And each of these subsidiary businesses is run with an entrepreneurial mindset, with an owner/ manager mentality. Bidvest is another great example of owner/ manager mindset.

PREPARE RESERVES ACCORDINGLY

This allows them to navigate, negotiate and withstand the turbulent conditions, but it also means that they have ammunition to come off the ropes, or to go to the centre of the ring and bring a tactical energy that many of their competitors simply don’t have because of their reserves. An example of how not to do it comes from the South African mining industry where, in the late noughties, valuations got to all-time highs, helped by buoyant prices, incredibly profitable operations and very strong cash flows. Many firms even moved into the business of declaring special dividends. But when commodity prices collapsed, many firms experienced a collapse in valuation and profitability. In one example, the market cap of one of the precious metal’s giants fell by 98% and they had to go to shareholders to recapitalise as a loss-making business at the bottom of the cycle. They had left nothing in the tank. No reserves equals no absorptive capacity.

BEHAVE COUNTER-CYCLICALLY

Agile absorbers – and perhaps the miner’s experience above helps reinforce this – behave counter-cyclically: in good times they shore up for bad times, and in bad times they go to the reserves and they use these to support the company, possibly do acquisitions at prices that would be more depressed than otherwise in the industry. So they’re counter-cyclical, which is contrary to “average behaviour” which obviously is pro-cyclical.

CUSTOMER-CENTRICITY

Another element of absorption, also flagged as part of agility, is customer-centricity, which promotes stability, especially in bad

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HOW DO WE TRAIN OUR COMPANIES TO BECOME LIKE ALI?” times. It’s a well-established fact that acquiring customers is far more expensive than retaining customers. And it’s remarkable how many businesses overlook this potential competitive strength.

BUY YOURSELVES

GORDON INSTITUTE OF BUSINESS SCIENCE

This means paying down debt and acquiring their own shares.

These companies don’t use cash to necessarily acquire other businesses. Instead they acquire businesses that they know and understand: their own, which means they buy back and cancel shares.

STRONG CULTURE

In every one of these agile absorbers you will find a celebrated culture and shared value. They eat their own cooking and walk their talk. Aspen is a lovely example of this where, in business after business, inside of Aspen, you will find a common mindset, a shared culture, an entrenched spirit and value. Investec and Bidvest are equally good examples.

COUNT THE CASH

When it comes to measuring the performance of the business, these companies don’t measure accounting profit, they measure cash flow profit. One of the hallowed metrics is cash flow return on invested capital. This is a very sober and honest way of asking a simple question: did this investment translate into cash in the bank?

LEADERS WHO STAY

These business have stable leadership. Think of Asher Bohbot at EOH, Stephen Saad at Aspen and Stephen Koseff at Investec.

Succession policies are communicated very clearly, and these companies also grow their own timber: they know how to attract, retain and guard talent.

These are the attributes that translate into businesses that are able to navigate and negotiate difficult circumstances in far better shape and with more impressive and stable performance than their peers. They can go toe-to-toe with tough times and get the judges’ decision every time.

For seven rounds on that hot, humid African night, Ali had leaned back on the ropes and allowed Foreman to bring the fight to him.

Punch after punch from Foreman landed on Ali’s forearms, but many slipped through his guard to hammer his ribs and kidneys.

Watching replays later, it was clear that Ali had an extraordinary ability to defend. There was now no doubt that the man from Louisville, Kentucky, could absorb punishment from the hardest hitter in the world but Ali knew that throwing all those punches would expend Foreman’s energy and tire him. Ali called it his ‘rope-a-dope’ trick and as Foreman came at him, Ali also kept snaking out a wickedly punishing right jab into Foreman’s face. In round two he displayed agility, slowing his foot speed and finding in his artillery the right-hand lead, which disrupted Foreman throughout the fight. Then, in round eight, as Foreman tried once again to pin Ali to the ropes, he unleashed a devastating series of right hooks, dancing into a five-punch combination that sent Foreman stumbling to the canvas. “Big George” rose groggily on the count of ‘nine’ but his fight was over. Ali’s incredible abilities of absorption and agility had regained for him the Heavyweight Championship of the World. Not for nothing was Ali known as “The Greatest”

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PHOTO: GALLO IMAGES/GETTY IMAGES/BETTMANN

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advertorial

TURNING HUMANITARIAN DREAMS INTO DECISIVE ACTION When a humanitarian organisation in Geneva (or New York, or Ottawa) has the compassionate dream of getting necessities to mothers and children at a refugee camp in war-torn Libya, the usual logistics challenges of moving goods from A to B are dwarfed. When vaccines must reach a remote village in West Africa, or urgent medical supplies are needed to treat the victims of an earthquake in Nepal, the experience and expertise of the humanitarian logistics specialists involved can mean the difference between life and death.

Humanitarian logistics is a branch of logistics that specialises in organising the delivery and warehousing of supplies during natural disasters and emergencies.

Responsiveness, efficiency and flexibility are critical for successful humanitarian logistics, says Imperial Logistics Chief Strategy Officer Cobus Rossouw. He cites the example of Imres, the Netherlands-based Imperial Logistics group company that is a leading global supplier of high-quality pharmaceuticals, medical consumables, hospital equipment and medical kits for health programmes and disaster response efforts around the world. The recent global crises where Imres is proud to have made a difference include the 2010 earthquake in Haiti, Typhoon Haiyan in the Philippines, the recent Ebola outbreak in West Africa, the Syrian refugee crisis, Ecuador’s 2016 earthquake, Hurricane Matthew and the subsequent cholera outbreak in Haiti.

The company packs and distributes all types of emergency and medical kits, according to customers’ specific requirements. These range from basic to complicated kits, for a variety of purposes, assembled either from stock or specially developed and sourced for customers. “Imres also stocks and distributes Interagency Emergency Health Kits (IEHK) that help 10 000 people every three months,” Rossouw expands. The company’s state-of-theart infrastructure includes 10 000m2 of climate-controlled Good Distribution Practices (GDP) and GSP-certified warehouses located in the Netherlands and in Dubai. These offer a total of 20 000 pallet locations.

“Working with leading global non-governmental organisations to help those who are sick, vulnerable and crisis-stricken, Imres’s

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Cobus Rossouw, Chief Strategy Officer

business encompasses much more than logistics. The company recognises that the best medicine is useless if it cannot get to where it is needed, when it is needed; it has honed its logistics expertise. Over more than 35 years in business, Imres has become a humanitarian logistics expert with the ability to identify the most reliable channels for delivery.”

The optimal humanitarian logistics channel must be designed for speed and efficiency, he stresses. “The humanitarian logistics provider must also be flexible. This allows everyone to act fast; to make quick decisions on how all the role players must respond.

While understanding that delays can cost lives, affordability must still be considered because many of the aid agencies and NGOs face cost constraints.

“The greatest risk is that the goods will not reach the affected area and people in time or in good condition.” To mitigate this risk, the humanitarian logistics provider must be as proactive as possible; anticipating every eventuality and leaving nothing to chance. Political considerations and obstacles are among the issues that must be understood and overcome. “Syria, for example, does not permit any Israeli products to enter the country. For some countries, waivers cannot be obtained.”

A letter of commendation to Imres from client the International Rescue Committee (IRC), after the delivery of emergency medical supplies to the survivors of Boko Haram terror in northeastern Nigeria, reflects the magnitude of the challenges facing humanitarian logistics providers. “We got our medicines this morning, all the way up Boko Haram front lines,” the IRC said. “This region is notorious for difficulties in the supply chain. Medicines sometimes take six to seven months to reach us. We want to thank you for your prompt communication and response to our high-level emergency out here.”

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10 Skeen Boulevard Bedfordview 011 677 5000 Imperiallogistics.co.za GPS Coordinates 26°11’44.48”S | 28° 7’49.89”E

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WHY THE FRENCH EMAIL LAW WON'T RESTORE WORKLIFE BALANCE Words Tiaan Moolman & Michael Mankins

GORDON INSTITUTE OF BUSINESS SCIENCE

The “right to disconnect”: Is the law the answer?

A new law establishing workers’ “right to disconnect” went into effect in France on January 1 of this year. The law requires companies with more than 50 employees to establish hours when staff should not send or answer emails. In an interview with the BBC, French legislator Benoit Hamon described the law as an answer to the travails of employees who “leave the office, but they do not leave their work. They remain attached by a kind of electronic leash – like a dog.”

• The level of e-communication has grown every year since 2008 (the year we started examining this data), and much of it now creeps into off-hours and weekends.

. . . ELIMINATE “REPLY ALL” – FIGURATIVELY OR LITERALLY”

Stated differently, the average frontline supervisor devotes almost half a day each week to processing unnecessary e-communications.

We all know intuitively that we are more connected to the workplace than ever before. When Bain & Company examined e-communications and other forms of collaboration at two dozen large global companies, we found that the time devoted to email, instant messaging (IM), crowdsourcing, and other online communications is extensive and, unfortunately, on the rise. We used data mining tools to comb through information captured in Microsoft Outlook, Gmail, and similar applications to understand precisely how much time is dedicated to processing e-communications – that is, sending, reading, and responding to email, IM, and other messages. What we found confirmed what many of us have long suspected, namely: • Senior executives now receive 200 (or more) emails per day.

• The average frontline supervisor devotes about eight hours each week – a full business day – to sending, reading and answering e-communications.

Of the eight hours managers devote to e-communications each week, we estimate 25% of that time is consumed reading emails that should not have been sent to that particular manager and 25% is spent responding to emails that the manager should never have answered.

There is nothing an individual employee can do to combat this onslaught. Neglect too many emails or IMs, and you risk irritating your peers or, worse, your boss. And if sending endless email chains is the way your organisation gets things done, then you have no real choice but to adopt the ways of the tribe. In short, excessive e-communication is an organisational problem. It demands organisational solutions.

While the intent of France’s new law is laudable, rules like this confuse effect with cause, and as a result probably will not slow the tide of e-communication. At best, these measures will merely shift the timing of workplace communications from off-hours to the workday and push other “work” to weekends and after hours. In short, government officials can tell employers that they should not expect employees to respond to e-communications during off-hours, but unless the need – or perceived need – for excessive email, IM, crowdsourcing, and the like is somehow addressed, no government mandate will have much of an impact on the total time devoted to e-communications by employees or supervisors. Indeed, the French may quickly discover that their most productive workers are routine “lawbreakers” who stay

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connected during off-hours to reduce the need to take time away from family and friends to complete other work-related tasks.

The only way to decrease the total time dedicated to e-communications is to encourage leaders and employees to manage the load they put on the organisation through email, IM, and so on. In our work with clients, we have come to believe that the best way to do this is to provide real-time information to leaders regarding organisational load, defined as the total hours devoted to reading and responding to emails originating from each executive. The leadership team at Seagate, for example, found that merely providing information on the total load each manager generated each week compared to peer executives helped to reduce unnecessary e-communications.

Internal competition encouraged leaders to reduce the number of employees copied on each email as well as the responses they sent to emails that did not require one. Combined, these actions reduced the time devoted to processing e-communications, without the need for mandates. Information alone modified management’s behaviour.

Another simple but powerful action is to eliminate “Reply All” – figuratively or literally. Since it takes time to read any email, even those that are unnecessary or not intended for you, the Reply All feature can be a big time-waster. In the organisational time audits we described earlier, we found that Reply All being so easy to use costs the average frontline supervisor more than 30 minutes a week in processing unnecessary e-communications. Eliminate

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. . . RULES LIKE THIS CONFUSE EFFECT WITH CAUSE . . . ” the feature and you will liberate unproductive time across the organisation.

There is little doubt that unnecessary e-communication is costly, not just to the individual employee but to society at large. It contributes to employee burnout and lost productivity. But legal mandates focused on the symptoms, rather than the cause, of excessive emails are likely to have little effect. It’s time for leaders to take responsibility for the load they put on the organisation and to take steps to change the way work gets done on the job.

Only then will employees be able to successfully cut the leash and focus their precious time on delivering great results

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Tiaan Moolman is a partner in Bain & Company’s Johannesburg office where he leads the local Organisation practice. Michael Mankins is a partner in Bain & Company’s San Francisco office and a leader in the firm’s Organisation practice. He is a coauthor of Time, Talent, Energy: Overcome Organizational Drag and Unleash Your Team’s Productive Power. See review, P85

COMPETITION

MY OWN LIBERATOR - WINNERS! Readers of Acumen had a chance in our last edition to win one of three signed copies of My Own Liberator, the recently published autobiography of former Deputy Chief Justice of South Africa, Dikgang Moseneke.

Three questions had to be answered: 1. HOW OLD WAS MOSENEKE IN 1963 WHEN HE WAS SENTENCED TO 10 YEARS IMPRISONMENT ON ROBBEN ISLAND?

A. 15 years 2. DURING THE 1990-94 NEGOTIATIONS WHICH LED TO DEMOCRACY, MOSENEKE WAS SECOND DEPUTY PRESIDENT OF WHICH PARTY?

A. PAC

3. MOSENEKE BECAME CHAIRMAN AND ACTING CEO OF WHICH MAJOR SA TELECOMS COMPANY?

A. Telkom Fourteen correct entries were received and the winners were drawn at random by GIBS Dean Prof. Nicola Kleyn.

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Congratulations to Deon Adams, Evans Kgatla and Marina Bidoli!

One of our winners, Marina Bidoli, receiving her prize from GIBS Dean Prof. Nicola Kleyn.

60 dynamic markets

DREAMER MAWONEKE ACCIDENTALLY TAKES ON COCA-COLA Words Godfrey Mutizwa

Question: How do you take on Coca-Cola, the largest beverages maker in the world?

Answer: By making what they don’t make.

For years, teetotaller Gladys Mawoneke had always struggled when she went Gladys Mawoneke out with her alcohol-consuming friends because she could never get what she deemed a suitable drink for a professional woman. Then, one morning while wondering where her next bond payment was going to come from, the flash bulb went off and Breva, “the drink to drink if you don’t”, was born.

Many knocks and lifetime bruises later, adult non-alcoholic drink Breva finally made it to market, breaking into a segment that Coca-Cola says is the fastest growing in the world, and that Euromonitor International values at as much as $27 billion in Africa and the Middle East when including all soft drinks.

“I really wanted to meet the needs of people like me,’’ Mawoneke said in an interview. “Professionals looking for a drink they could drink comfortably as adults when they are out and about without feeling alienated from the social norms. The numbers show 65% of South Africans don’t drink for various reasons.’’

GORDON INSTITUTE OF BUSINESS SCIENCE

Breva, which comes in four variants, is targeted at non-alcoholic consumers or light alcohol drinkers between the ages of 24 and 35 in LSM 7 to 10 in urban areas. The secondary target market includes 16 to 23 year olds and those over 36 years of age.

“Within this segment is an emerging middle class that is looking for a brand or drink that is an extension of who they are; young ambitious, fun, successful, independent adults,’’ Mawoneke says.

“I never saw Coca-Cola as a competitor but I saw Coca-Cola as a model I could use to build a business for the long term.’’

A trained journalist, Mawoneke ditched the fourth estate after moving to South Africa in 1996 and went on to study law and is now an admitted attorney of the High Court of the Cape of Good Hope. She also holds a Master of Business Leadership degree.

LONG AND WINDING ROAD

Entrepreneurship had always been on her mind from the time she saw her father become one of the few black commercial farmers in colonial Rhodesia. But it’s been a hard slog from the comfort of the

corporate world which included senior management positions at multinational British American Tobacco, South Africa.

Her first venture – making unpasteurised fermented milk – lasted all of three months. The next one – making chocolate and herbbased breads – was even shorter, at a day. Then an opportunity opened in the fruit and veg sector where a group of farmers approached Mawoneke to export their produce. And it was while tramping between hotels and stores that her ‘Aha! moment’ arrived one morning.

But the journey has not been without its challenges.

“When we started building this brand the economy was in a downturn and the consumer was under pressure and so was the currency,’’ she said. “Then there were our own micro issues: balancing cash flows and building a brand in a market where big boys were already operating. But because of the quality of the product we have been able to penetrate the difficult, organised retail market.’’

With Breva now stocked in household retailers Woolworths, Pick n Pay, Checkers and some independent outlets, Mawoneke is looking at buying her own bottling plant and then on to Africa where stats show per capita drinks consumption at 38 litres versus 138 in South Africa. Already, she has received inquiries from the continent.

Predators have also been circling already but the 45 year old is going nowhere.

“The big boys know we exist and they keep an eye on us. I have had some expressions of interest from a couple of players but I am not here for a quick buck. I want to build a long-term business. Two years into our hundred-year journey we have grown to seven-digit revenues. We have just begun”

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dynamic markets

Donovan Chimhandamba

BENEFICIATION, SET TO TAKE ON REAL MEANING Words Godfrey Mutizwa

Africa’s quest to add value to its raw materials has been around for almost as long as the continent’s first independent nations and their dreams of building industries in place of the commodity export oriented economies they inherited from their colonisers. And yet, in the past five decades, there is little to show for the effort with most of the gold, iron ore, oil and coffee that the continent exports coming back at as much as ten times the value of the original export, according to some economic estimates.

The tide may be turning.

At a regional level, the Southern Africa Development Community (SADC) industrialisation strategy, announced in 2014, seeks to add value to mineral exports as part of a plan to diversify its economies, and increase linkages with the mining sectors.

International Trade Centre data shows that SADC mineral exports constituted as much as three fifths of all merchandise exports in 2013.

GORDON INSTITUTE OF BUSINESS SCIENCE

“The fundamental issue that faces resource-rich countries in Africa is the lack of an established and efficient manufacturing sector,’’ says Zamanzima Mazibuko, a researcher at the Mapungubwe Institute for Strategic Reflection (MISTRA). “For beneficiation to effectively take place, suitably skilled human capital and considerable investment in infrastructure for the development of downstream industrial linkages need to take priority.’’

A start would be for each African country to conduct an accurate analysis and understanding of all resources that would be required to embark on beneficiation. “Thus, a triple helix approach in which government, private sector, and research institutions collaborate is essential in ensuring efficient policy development and implementation for a successful process of beneficiation,’’ she said.

Individually, most of the governments have reviewed their mining laws and tweaked their fiscal and industrial policies to promote beneficiation. Botswana is often cited as the best example of the benefits of beneficiation through its diamond processing plants.

Zambia has similarly taken steps to promote processing of copper exports in the country through increased taxation.

South Africa, the region’s largest and most industrialised economy got its own ball rolling in 2012, when it adopted its

Beneficiation Strategy for the Minerals of South Africa plan.

The country’s platinum miners have for years been researching fuel cell technology, supported by the Department of Trade and Industry while the success of the Krugerrand remains a hopeful sign it can be done.

NYANZA

More recently, Arkein Capital Partners’ Nyanza Light Minerals announced it was pushing ahead with a plan to produce titanium dioxide pigment (TiO2) from a waste steel dump owned by the now defunct Evraz Highveld Steel & Vanadium in a project that may cost as much as $300 million when complete.

“Beneficiation makes economic sense,’’ says Nyanza CEO and GIBS MBA, Donovan Chimhandamba, whose company is also looking at similar projects in Rwanda, Zimbabwe and Zambia. “If we can trap most of the value at source, the value chain becomes more profitable and that makes resources that were deemed unviable, viable.’’

The plant could be a game changer for manufacturing as titanium dioxide pigment is used in everything from paint and food to clothing. Nyanza projects construction will begin next year with production set for the final quarter of 2019.

“These things take time and sometimes you get shareholder fatigue. Some of our initial shareholders left,’’ Chimhandamba said. “But you need government support to get these things off the ground and sometimes you just need to shut your ears to the political noise.’’

There are also other challenges as Arkein and its partners and the Botswana example show. Skills training, technology and a favourable business environment including government support, were also key metrics in building successful beneficiation projects, researchers say

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Lilongwe 2780 km 5-6 days Lusaka 2067 km 4-5 days Johannesburg 1772 km 2 days Livingstone 1565 km 2 days Gaborone 1498 km 2 days

The Port of Walvis Bay is Namibia’s largest commercial Port. It stands as a natural gateway for international trade and is strategically situated along the central coastal region of Namibia, offering direct access to principal shipping routes. The Port receives approximately 4,000 vessel calls per year, handling over 6 million tonnes of cargo. The container terminal accommodates ground slots for 3,875 containers with

Upington 1204 km 1 day

road distance from port of Walvis bay

Harare 2297 km 4 days

Lumbumbashi 2388 km 4-5 days

Two decades of Port Excellence

provision for 424 reefer container plug points, and a capacity to host 355,000 containers per annum.

www.namport.com

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dynamic markets

DOING BUSINESS IN NAMIBIA Words Daniel Steinmann

GORDON INSTITUTE OF BUSINESS SCIENCE

A dramatic shift has occurred recently in the way Namibia views its own development and future. While it is often stated that Namibia consumes what it does not produce, and produces what it does not consume, economic emphasis has always been inward looking. Since November 2016, that has changed fundamentally when the government hosted its first Invest in Namibia conference.

FACING ECONOMIC REALITIES

For the past 28 years, the Namibian government has focused solely on own resources to fund development with only a very limited, modest contribution from overseas development partners. But the economic headwinds of 2016 brought about a significant change in philosophy.

Namibians have now realised that the future will by necessity include investment partners from multiple sources.

The Namibian economy is expected to generate a Gross Domestic Product (GDP) of R171 billion1 for 2017, about 3.6% of the projected SA GDP of R4.7 trillion. Around 80% of imports comes

from South Africa and around 92% of all primary commodities, mostly minerals and metals, is exported.

2016 has turned out to be an extremely difficult year. A substantial shortfall in projected government revenue forced the minister of finance to review the entire budget, leading to the tabling of the Mid-Term Budget Review in October. Revenue was revised down by 16% while expenditure had to be cut by 8%. This caused the biggest budget deficit since independence in 1990, measuring 6.3% of GDP. Namibia’s total debt stock approaches 42% of GDP, modest by South African standards but still high when benchmarked against the IMF’s 43% maximum for middle income countries.

To unpack Namibia for a South African audience, the monetary unit throughout is the South African rand. The Namibia dollar is linked on par value to the South African rand.

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PHOTO: GALLO IMAGES/GETTY IMAGES/OLEKSANDR RUPETA

Harbor of Walvis Bay, Namibia

dynamic markets

In the wake of these realities, the Invest in Namibia conference heralded a marked shift in government policy, opening the door for unlimited participation by foreign investors.

To overcome the obvious financing constraints, the government has drafted and adopted a public-private partnership policy under which a small number of projects are already running. The legal backing comes in the form of the PPP Bill currently before the National Assembly in Parliament.

PER CAPITA GDP

The total population of 2.2 million is about 4.2% of the South African population, a statistic that indicates the relative underperformance in local output. Namibian GDP per capita oscillates in the region of US$6 000 whereas in SA, it falls between US$6 600 and US$7 000.

Windhoek, the capital, has an estimated seasonal population as high as 360 000.

On the coast, the Swakopmund-Walvis Bay complex is home to about 240 000 people while in the north, the Oshakati-Ondangwa-Ongwediva complex may have as many as 500 000 people, depending on demarcation.

EDUCATION

According to the Ministry of Education, Arts and Culture, about 84% of children are attending primary school up to Grade 7.

Attrition is high with only about 66% of the number of primary learners eventually reaching Grade 12. Tertiary education, including vocational training, covers slightly less than 8% of the population. The skills deficit is pervasive and a factor foreign investors have to incorporate into their plans. Still, tertiary education is of a high standard with all qualifications benchmarked by the Namibia Qualifications Authority.

Vocational training is an important pillar of the Namibian government’s education policy. It is now part of the official educational framework, providing training and testing to some 22 000 young people.

HEALTH

A huge disparity exists between urban and rural health services.

Private hospitals are located in Windhoek, Swakopmund, Walvis Bay, Gobabis, Otjiwarongo and Ongwediva. In these institutions, health service is world class. For instance, in one Windhoek hospital open-heart surgery is done regularly.

Residents in the rural areas, however, rely on state hospitals and clinics. These are generally understaffed and undercapitalised but still far more advanced and sophisticated than the stereotyped African bush clinic.

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. . . THE BIGGEST BUDGET DEFICIT SINCE INDEPENDENCE IN 1990 . . . ” MOBILE CONNECTIONS

96% of Namibia’s population is covered by a 2G network with about 15%, mainly in Windhoek, Walvis Bay and Ondangwa, enjoying 4G connectivity.

The two mobile service providers, MTC and Telecom Mobile offer Wi-Fi data connectivity which is generally reliable but bandwidth often poses a problem in the 2G network.

All commercial farms have Internet access through their mobile connection. Internet is widely available in all towns and villages.

TRANSPORT INFRASTRUCTURE

Namibia is connected by sealed all-weather roads to South Africa, Botswana, Zambia and Angola. The interior is served by an extensive network of gravel roads that are generally in a good to excellent condition, depending on local rainfall.

Since 2010, the sealed road network has been upgraded extensively now connecting the northern regions by tar both east and west of Etosha.

Development of the so-called trade corridors is a government priority. These routes connect Namibia to Angola, Zambia, the Democratic Republic of the Congo, Zimbabwe, Botswana and South Africa, both to Gauteng and the Western Cape.

The Walvis Bay Corridor Group is the designated agency that works to promote the utilisation of the trade corridors. The main target is to connect all trade corridors to the Port of Walvis Bay, where the quay is being extended to double the number of berths with a 12-metre draught point datum. The container terminal is in the final phase of upgrading to be able to handle 650 000 twentyfoot containers per year.

The rail network connects to the South African network at Ariamsvlei. It connects the ports at both Lüderitz and Walvis Bay to the interior and to Oshikango on the Angolan border.

The two main border posts between Namibia and South Africa operate 24/7 while those to Botswana and Angola are open 16 hours per day. South African visitors do not require a visa. Either a tourist visa or a business visa is issued at point of entry.

PREFERENTIAL SECTORS

In 2010, the Namibian government first named the sectors targeted for preferential investment. In addition to the three social sectors, education, health and civil safety, the economic sectors are tourism, transport, mining, agriculture and construction.

Several policies have been drafted and implemented with varying degrees of success. The latest intervention policy, the President’s

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Harambee Prosperity Plan, introduced in March 2016, is the most extensive and ambitious. It is also the best-researched and pragmatic development policy to date, but like all managed projects that depend on government funding, it is hampered by a lack of available funding and investors.

While all mining activities have suffered from the impact of a declining commodity cycle, it remains one of the industrial sectors with the most potential, especially for an economy where foreign earnings depend on primary exports. The mainstay of the economy is still diamonds despite the contraction of carat volumes during H1, 2016. Higher production levels are expected on the back of the new mining vessel commissioned by Namdeb, the diamond mining partnership between the Namibian Government and De Beers.

Uranium output has more than doubled with the opening of the new Husab mine in the desert near Swakopmund. Owned and operated by the government of the People’s Republic of China, this mine started production in December 2016. At full production Husab’s output will contribute to make Namibia the fifth largest uranium producing country in the world.

Expansion of Canadian gold miner, B2Gold’s Otjikoto mine near Otjiwarongo, is expected to double local gold production.

GORDON INSTITUTE OF BUSINESS SCIENCE

TOURISM, AGRICULTURE AND CONSTRUCTION ARE THE THREE SECTORS WITH THE BEST ENDURANCE AND SUSTAINABILITY” Namibia has two zinc mines near the Orange River, several diamond mines along the southern Namib coastline, three uranium mines near Swakopmund, two uranium projects under development, a small gold mine near Karibib, the B2Gold mine near Otjiwarongo, a copper smelter in Tsumeb with two copper deposits mined by Weatherly. There are a host of smaller mines, promising graphite projects, limited lithium prospecting, extensive salt production at the coast, and active prospecting for both offshore and mainland oil.

According to all indications and public statements, oil has been discovered in at least one prospecting block. However, since the announcement almost two years ago very little tangible progress has come from the Brazilian operator.

Tourism, agriculture and construction are the three sectors with the best endurance and sustainability. 2016 was a bumper tourist year, despite many smaller establishments shutting down.

The tourism sector is in the final stages of consolidation where literally hundreds of small privately owned establishments are now dominated by a few emerging large companies, each with many lodges and hotels in their stable, offering tourists the convenience of dealing with a single operator, but being able to tour the entire country.

Agriculture suffered a severe setback with the shocking drought of 2016. Grazing was devastated, leading to forced marketing during the first half of 2016. The drought also took its toll on the limited but crucial cereal production in the Grootfontein district and at the Hardap irrigation scheme near Mariental, forcing public agencies to import more than 80 000 metric tonnes of white maize and around 38 000 tonnes of wheat.

Construction is the one sector where most of the government’s stimulus has been concentrated. This produced a flurry of building activity in all major centres, witnessed by the dozen or so impressive new government buildings in Windhoek.

The state’s answer to the pervasive shortfall in low-cost housing, the Mass Housing Project, has made some progress but the national demand remains staggering. Of the 180 000 units per year promised in 2010, perhaps 30 000 or 40 000 in total have actually been delivered hampered by both physical and legal impediments.

FINANCIAL SERVICES

The sophisticated financial services sector is regulated to international standards and fully integrated with the South African financial sector. The unlimited and unrestricted flow of capital between Namibia and South Africa is one of the attractive considerations for foreign investors.

Local banks are all migrating to digital platforms for client services and new business, particularly for mobile payments.

Bank ownership structures are changing as the Financial Services Charter, an industry-agreed strategy, requires 25% shareholding by previously disadvantaged persons, either individuals or groups, in all established commercial banks by 2020.

All Namibian banks now have an indigenous shareholding scheme in place with efficient financing mechanisms to ensure the sustainability of these deals.

The banking industry is regulated by the Bank of Namibia.

Monthly reporting is required to ensure that all banks conform to Basel II standards with a view to introduce Basel III. Statutory capital adequacy is set at 10% of banking assets but Namibian banks are typically proud to publish their results, showing that capital adequacy ratios run between 12.5% and

dynamic markets

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PHOTO: GALLO IMAGES/GETTY IMAGES/EYE UBIQUITOUS

Open-cast uranium mine in Namibia

14%. The four big banks are sound, well-managed and not severely affected by the drastic reduction in liquidity experienced during 2016.

The rest of the financial services sector is regulated by the Namibian Financial Institutions Supervisory Authority, NAMFISA. Their oversight applies to long-term insurance, short-term insurance, institutional savings, pension funds, asset managers, fund managers, unit trusts and financial intermediaries. The authority is funded from transactional levies in the investment management value chain.

A fundamental aspect of the Namibian economy is that it is an exporter of capital. While there is almost always a deficit on the current account, the capital account shows a substantial surplus.

In its efforts to repatriate more of Namibia’s capital to be employed in the long-term development of the country, Regulation 28 of the Pension Fund Act, and Regulation 15 of the Long-term Insurance Act, force all local players in the financial services sector, to have 35% of their assets invested in Namibian assets.

In September 2015, Regulation 29 was added for pension funds, raising this limit effectively to 38.5% through the investments of 3.5% of total assets in unlisted companies.

As always, harnessing the capital is easier than finding the target investments, i.e. companies that are willing to sell a part of their shareholding, or even more difficult, establishing new projects that comply with international standards of profitability and sustainability.

INVESTMENT OPPORTUNITIES

Despite its small size, Namibia has a promising future, both for its citizens and for foreign partners who want to engage the local market.

But being less than 5% of the South African market poses its own unique set of problems.

First, there is no substantial local market, either for investment, or for consumer goods. The small population is still largely rural or seasonally migratory.

Furthermore, any development and commensurate funding strategy must always contend with Namibia’s aridity. The absence of water is a unifying, pervasive element of daily existence, and severely limiting on certain water-intensive industries.

Although Namibia has an Export Processing Zone Act and a legal framework intended to support the EPZ companies, the large EPZ at Walvis Bay has floundered as one after the other manufacturer closed shop. The EPZ regime for all intents and purposes is now defunct except for the small quota of diamonds polished by the state-owned Diamond Trading Company. The legal framework, however, is intact.

Since the government’s New Equitable Economic Empowerment Framework (NEEEF) has drawn such a barrage of criticism, both domestically and foreign, it forced the Office of the Prime Minister back to the drawing board for public consultation and a redraft of the bill. In the meantime, NEEEF intentions have largely been overtaken by economic reality during 2016. To put a positive spin on investment, the government has switched from penalising local economic actors, to engaging them, proposing the PPP Bill instead.

Based on incentives, participation and shared profits, this new approach will relieve much of the pressure on the government’s capital projects while making more current funding available to focus its support on the social sector

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EIGHT THINGS TO SEE & DO IN NAMIBIA Words Daniel Steinmann

When the business is done take some time to explore Windhoek and other parts of this close neighbour.

GORDON INSTITUTE OF BUSINESS SCIENCE

There are many excellent hotels in Swakopmund but the most outstanding is the rebuilt Strand Hotel. It occupies a prime

SOSSUSVLEI

The most photographed dune in the world rises more than 400 metres (vertical) above the desert floor. It is the largest link in a

location right along the southern wall of the Mole, the old German harbour that was in use up to 1915.

chain of dunes encircling the northern and western periphery of the equally famous Sossusvlei and Dead Vlei complex.

PHOTOS: NAMIBIA TOURISM, THE NAMIBIA ECONOMIST, JOE’S BEERHOUSE, OHLTHAVER & LIST

STRAND HOTEL

dynamic markets

JOE’S BEERHOUSE

NAMIBIA BREWERIES

NAMIB MILLS

INDEPENDENCE MUSEUM

As the only commercial miller of industrial size, Namib Mills is the anchor industry guaranteeing local food security. Located in Windhoek’s Northern Industrial Area, this family-owned group is Namibia’s largest producer of refined cereals.

The Independence Museum tells the story of Namibia’s liberation struggle. It squats on a slight rise just east of the central business district near the famous Christuskirche, the Tintenpalast and the Alte Feste.

XWAMA TRADITIONAL RESTAURANT

GAMMAMS RECLAMATION WORKS

Joe’s Beerhouse is the most famous restaurant in Windhoek with a seating capacity of 580 persons, open 7 days a week catering mainly to tourists yet also meeting expectations of locals.

PHOTOS: NAMIBIA TOURISM, THE NAMIBIA ECONOMIST, JOE’S BEERHOUSE, OHLTHAVER & LIST

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Diners are always greeted by a splendid cultural troupe upon arrival at Xwama Traditional Restaurant and Cultural Village.

Located in Windhoek’s sprawling western suburb, Katutura, it is just as popular for its many traditional recipes as for its cultural entertainment in the form of song and dance.

Namibia Breweries is the diamond of Namibian industry. A visit to the brewery in Windhoek’s Northern Industrial Area offers a glimpse of successful vertical integration.

Were it not for the City of Windhoek’s competence in recycling waste water, the city could not survive. The water purification works at the Gammams Reclamation site and Goreangab Waste Water treatment plant, are acknowledged as world-leading technologies for recycling and purifying water.

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Bulbine frutescens field

THE FIRST BARON OF BULBINE Words Sean Christie

After a series of serendipitous events (and a great deal of risk-taking and hard work), farmer Wilhelm Coetsee is the commercial king of katstert (Bulbine frutescens), an indigenous medicinal plant more commonly associated with traffic islands.

The story behind Botanica Natural Products has its beginnings in 2008, on Mogalakwena Game Reserve near Alldays in South Africa’s Limpopo Province. Brothers Wilhelm and Christiaan Coetsee, the reserve’s owners, were hosting a Frenchman by the name of Michel Colson. In the course of a guided walk one morning Colson had spotted a cluster of aloe-like plants with

long, spindly stems, covered in little yellow flowers. He had asked about them, and Chris Coetsee had rather dismissively said, oh, those are my mum’s medicinal plants. The plant in question was Bulbine frutescens, known to many South Africans simply as Bulbine, or geel katsert (yellow cat’s tail), on account of its long stems.

entrepreneurship

Colson’s eyes lit up. The Coetsee boys now learned that the man they were hosting had dedicated 45 years of his life to sourcing indigenous medicinal plant extracts for the European cosmetics industry.

Heard of shea butter, the famous skin moisturising substance from Burkina Faso? Well, Colson was instrumental in its commercialisation in the early 70s.

“Michel had learned that if there’s any traditional knowledge associated with a plant, there’s bound to be something interesting in it. He pushed us for more information and my father explained that our family had long used it to treat burns and insect bites, as many South Africans do,” said Coetsee, who, with his shaved head and lecture-hall glasses, seems an unlikely denizen of the Koedoesrand bushveld.

Colson rushed to the nearest pharmacy (150 kilometres away in Polokwane), and bought a very basic preservative. He rolled gel out of a few Bulbine plants, preserved it and returned to Europe.

“The people who tested it told him that, in terms of its medicinal properties, Bulbine was similar to aloe vera, but actually far more effective – like aloe vera on steroids,” said Coetsee.

Colson’s connections were very interested in promoting Bulbine to the cosmetics industry as an interesting new active ingredient, and wanted to know where they could buy more of the stuff.

“We scoured the country and found that there were a couple of cottage industry operations, but nothing on a commercial scale. Michel was very excited by this, and asked us whether we would be able to produce the plants,” he said.

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. . . OUR FAMILY HAD LONG USED IT TO TREAT BURNS AND INSECT BITES, AS MANY SOUTH AFRICANS DO” “We decided to test the waters by preparing a 0.3ha plot and propagating the plants we already had,” said Coetsee.

Colson meanwhile approached a cosmetics industry client in Hamburg, which expressed an interest in buying Bulbine extract.

A joint business venture called Botanica Natural Products was swiftly set up, comprising the German company and the Coetsee and Colson family businesses. Funding was secured in the form of a grant from the Dutch government.

“It was a development and innovation grant, so there had to be a social upliftment aspect and some originality. We ticked both boxes because the project, which was something nobody had ever attempted before, was creating new jobs in a jobs-scarce part of the country,” said Coetsee.

A process was designed for extracting Bulbine gel, and a factory was developed on one of the Coetsee farms in the Alldays district.

“Progress was often slow because we simply did not know what we did not know,” said Coetsee.

GERMANY

By 2011, 160 000 plants had been successfully propagated from the original 40. Visitors to the farm would not have known this, however, because the field was tucked away in a remote corner.

LOCAL LAWS

In the 90s and early 2000s the beauty and personal healthcare industries were booming, and the world’s largest pharmaceutical and cosmetics companies were out energetically seeking the next big active ingredient.

With over 22 000 plant species South Africa seemed poised to benefit, but the passing of a series of noble but poorly designed laws aimed at protecting traditional knowledge systems choked investor interest.

Coetsee, then just 28, was aware of the challenges, and they interested rather than intimidated him. During his years as a MBA student at the University of Stellenbosch Business School he had read and re-read the Blue Ocean Strategy of Chan Kim and Renée Mauborgne, which makes the case for operating in uncontested ‘blue ocean’ market space rather than overcrowded ‘red ocean’ markets.

South Africa’s 500 or so medicinal plants were certainly swimming in the blue, with less than 10% having been commercialised.

Bulbine frutescens flowers

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IT IS USED TO SOOTHE THE TATTOOED AREA, AND APPARENTLY, IT ALSO HELPS TO BIND THE INK TO SKIN” SKIN-LIGHTENERS AND TATTOOS

Colson suggested a turn away from Europe towards West Africa, a market he was familiar with.

“We sent some samples to his West African buyers and they came back to us within three months with a five-tonne order,” said Coetsee.

Washing Bulbine frutescens leaves

“It was like agricultural fight club. We couldn’t speak about these developments at the time because our German partner was petrified they would lose first-mover advantage,” he said.

GORDON INSTITUTE OF BUSINESS SCIENCE

Next, the business partners faced the problem of how to commercialise their product. To begin with, they marketed their healing gel to companies in Europe. They approached Beiersdorf, for example, the owner of Nivea.

“We thought we were going to rake in the euros,” said Coetsee, “but when we met representatives of these big companies the first thing they wanted to know was: who else is doing this? We said nobody, that’s why it’s so exciting. And they said, yes, for you maybe, but we’re not going to go to the lengths of launching a product with all the related expense only for your company to fold, leaving us without a supplier. They told us to get back to them when some more people had started similar operations to ours.”

Coetsee and his partners were left with the problem of how to get their gel into a saleable formulation, because Bulbine extract is not a final product on its own.

“Between 2-5% will go into a product, no more. We had the idea of promoting the extract as a rare, premium ingredient, and again felt we had the recipe for lots of euros, but nothing happened, and nothing carried on happening,” Coetsee recalled. Eventually the German chemicals supplier – a four billion-Euro company – decided that selling a few-hundred kilos of Bulbine extract a year wasn’t worthwhile, and pulled out.

“Once again, it was a case of us not knowing what we did not know. In West Africa, the two major cosmetics sales categories are skin lighteners and hair straighteners, and West African fashionistas believe that if a product hasn’t worked within three weeks then it isn’t going to work. To meet these high expectations, a lot of cosmetics producers peddle terribly harmful stuff, which badly burns the skin. This, in turn, has created a market for products that relieve and treat chemical burns,” Coetsee explained.

Coetsee and his partners named their extract BotanicaTIMOLA – timola being the Sepedi word for ‘soothe’. Large monthly orders continued to roll in from West African cosmetics companies, and the factory in Alldays was suddenly working hard.

“Between 2015 and 2016, Botanica Natural Products decreased its reliance on shareholder loans by 80%, and in early 2016 the company broke even operationally,” said Coetsee.

Sales have continued to grow with the independent introduction of the extract into new geographical locations, including the United States, the United Kingdom and Australia. One of the developments driving Botanica sales is the use of Bulbine in products for tattoo aftercare.

“It is used to soothe the tattooed area, and apparently, it also helps to bind the ink to skin,” said Coetsee, adding that local interest in commercially growing and supplying Bulbine has taken off in the last half year.

.

“Not bad for a traffic island filler,” quipped Coetsee, with the air of someone who has embraced unpredictability as a life- giving force

future

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THE GREEN RUSH. HE (OR SHE) WHO DARES, WINS Words Dion Chang

In the past year, the legislation and regulation around medicinal and recreational marijuana has evolved at such a surprising speed, it’s now being called The Green Rush. It's a different kind of “green economy” and a new global industry that is about to boom. Venture capitalists, are you ready?

In February this year, the South African government gave the green light for the manufacture of cannabis for medicinal use: a watershed moment, with the IFP hailing it a “major victory” and tribute to its late MP, Mario Oriani-Ambrosini, who fought for the legalisation of the drug.

Ambrosini raised the debate over cannabis in Parliament in 2014, but lost his battle with lung cancer six months later and did not live to see the breakthrough.

IFP MP Narend Singh said, “Mario had fought tirelessly for this and although he proposed cannabis beyond medicinal use to also include it for recreational use, (but) we agreed to withdraw every clause relating to non-medicinal use in our efforts to ensure it becomes legal.”

For these highly controversial decisions to move forward, you need to start with baby steps, but the journey has begun. The current framework allows for use of cannabis for medicinal purposes, but only under strict regulations and permission from the Medical Control Council “for use in certain exceptional circumstances by registered medical practitioners”.

A POT OF GREEN GOLD Caution is good, and to be expected, not only because of the controversial nature of this new industry, but also the potential for monopolies by both pharmaceutical companies and drug cartels. There is a lot at stake. Currently the American market alone (and recreational cannabis is only legal in eight states) is worth $7.2 billion and projected to generate as much as $35 billion by 2020, so getting it right at this nascent stage is crucial.

It’s not just the overall worth of this budding (excuse the pun) industry, but the eye-watering tax revenue raked in by each of these states. When Colorado legalised recreational cannabis, the new industry brought in over $270 million, just in the first quarter. Now, new research from the Tax Foundation, a Washington DC-based think tank, reveals that the nationwide legalisation of cannabis could generate $28 billion in tax revenue for federal, state and local governments.

If we’re talking about radical economic transformation in South Africa, then this is a radical industry to consider.

Historically, cannabis has been part of the culture of indigenous people in South Africa, going as far back as the Khoisan. The first written account where the smoking of “dagga” is referred to, was in 1658, in Jan van Riebeeck’s journal, when he wrote about a southern Xhoi group smoking “dacha”. It was only in 1922 that the use of cannabis was officially and legally restricted, and then completely prohibited in 1928. The chance to reverse these laws is now. The Green Rush is real, and if you snooze, you lose.

OPPORTUNITIES ABOUND

Nicole Bacchus, Associate Director of Strategy at New York-based Smart Design, explained to innovation insights company PSFK, the huge opportunities that lie in an industry still in its infancy.

She was looking at the Green Rush in terms of design, and the ripple effect that it will have on branding and services throughout this new value chain. When viewed from this perspective – what cannabis means to the creative industries, and the long-term potential of the Green Rush – then the “nudge, nudge/wink, wink” insinuations that inevitably follow this conversation evaporate.

Firstly, the sheer scale of opportunities throughout the value chain, let alone the industry’s worth, is astounding. Cannabis’s identity is desperate for reinvention. Commercialisation and rebranding of something that was previously illegal, and therefore underground, requires skillful spin as well as mindful design.

Since there will be two distinct user streams, this doubles the opportunity.

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For example, creating a product (and narrative) for a grandparent easing the discomfort of glaucoma versus a product for college students looking to enhance their experience at a music festival.

This is the reality and trajectory of the Green Rush. Octavia Wellness is a San Francisco start-up that aims to introduce cannabis to the elderly population, allowing members of the online service to receive next-day deliveries and access to a member-based consulting network.

Another example is a female-focused cannabis brand called Foria.

One of their product offerings is Foria Relief Tampons specifically designed to ease the symptoms associated with menstruation.

The tampons contain a specially formulated blend of THC and CBD: cannabinoids which are known to relax muscles and release tension and cramping in the body without a psychotropic (“high”) effect.

Secondly, everyone from this point onwards should be considered a new user. Veteran cannabis smokers, as well as new users, need to be redefined. Regular users who are used to purchasing illegally, will soon be exposed a new range and category of products, as well as new services, which are already mushrooming around this industry.

Eaze, for example, is a delivery service for medicinal cannabis.

Last year the company received $13 million in series B funding, making Eaze the fastest growing and most funded cannabis technology company in the world. The next wave of start-up unicorns are going to be found in this industry.

UNDER STARTER’S ORDERS?

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But even in a city like New York, where the state has not yet given the green light for recreational use, forward thinkers are putting together business models and ecosystems under the radar, so that when (it’s not an “if ” scenario) the state finally legalises recreational use, they can immediately unveil their services. For now, it’s surreptitious and coded, but the services tap into the fast growing on-demand economy. One service provider accepts coded sms requests for “IT support”, and if you’re cleared, you get your cannabis delivered to your door. I wouldn’t be surprised if this doesn’t become part of the UberEats portfolio. On my radar is another on-demand cannabis service that is only available to women: women users and women only delivery – the industry is already niching and specialising.

Finally, new opportunities for improvement exist along the entire supply chain. At each part of this “seed-to-sale” chain, there are players struggling to deliver their value-add to the equation.

From investing and financing, to manufacturing and distributing, there are so many opportunities to design and create systems, services and structures that enable and improve cannabis’s path to a commercial market.

Inevitably, this ripple effect will produce complex challenges for these ancillary industries. In America, cannabis is still listed as illegal at a federal level. When different states started legalising recreational cannabis, none of the registered merchants could process any purchases through the banking system (i.e. take credit card payments) as the merchandise they were selling was technically “illegal”. This led to the merchants having to run cash-

THE NATIONWIDE LEGALISATION OF CANNABIS COULD GENERATE $28 BILLION IN TAX REVENUE” only transactions, which in turn lured criminals to their premises who knew they were holding thousands of dollars in cash. A spate of robberies and even hostage dramas ensued: the unintended consequences of a pioneering industry.

RESEARCH NOT ALLOWED

As with a gold rush, the Green Rush will draw a motley assortment of pioneers, activists, fortune seekers, charlatans and snake oil salesmen. But the formalisation of the industry will also ensure that the proper research can be undertaken, specifically in the medical realm. Currently, where cannabis is still deemed illegal, there exists a catch-22. If it’s listed as an illegal substance you aren’t allowed to conduct research on it, and if you can’t research it, you can’t prove the medicinal value.

The use and benefits of cannabis oil have fanned international debate in medical circles, with advocates of medicinal cannabis claiming its effectiveness in pain management and the treatment of diseases including cancer, glaucoma, multiple sclerosis and epilepsy.

As a result, many people with debilitating illnesses are turning to cannabis oil to test it, but they can only find it on the black market, which means the quality could be dubious – and so the catch-22 continues.

However, the speed at which the Green Rush is growing and evolving could mean that these inconsistencies in policy (and therefore product) could be resolved. Flow Kana is a San Francisco-based company that is driving the “clean cannabis movement”. Like the other start-ups in the Green Rush, it’s an on-demand medical cannabis delivery service that also promises to bring you cannabis directly from local, organic marijuana farmers. It’s the first “farm-to-bowl” concept of the Green Rush. Founder Michael Steinmetz says, “It’s important for the consumer to know where their cannabis comes from and who grew it.”

For anyone reading this and raising a sceptical eyebrow, then consider what a savvy Girl Scout did in Portland, USA. The enterprising 13 year old set up a table – with a sign reading “satisfy your munchies” – outside a medical marijuana dispensary to sell cookies to raise funds. She sold 117 boxes in 2 hours (her goal was to sell 35 boxes). The Girl Scout Association said of her endeavour, “we can’t condone this, but it’s not against the rules”.

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That’s what pioneers do. Identify an opportunity, and then beat the rush

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WINE Words John Maytham

Acumen’s wine expert picks three of the best at three different price points: Everyday, Dinner Party and Out To Impress.

EVERYDAY There are few people in the South African wine industry as canny and capable as Marc Kent. He’s been the public face and cellarmaster genius at Boekenhoutskloof since making the first wines on the 1993-purchased Franschhoek property from the 1996 vintage, and now presides over an ‘empire’ that has stretched from its original base into the Helderberg and the Swartland. (One recent display of his nous was to attract Gottfried Mocke away from nearby Chamonix to be his 2 i/c. What a formidable team!) The Boekenhoutskloof wines remain category leaders; the syrah from the Porseleinberg farm in the Swartland

garners critical acclaim globally; the Chocolate Block is a huge commercial success; and watch out for the first public release soon of The Journeyman, a wine that Marc has been making in tiny quantities for nearly a decade and supplying only to a select few. But it is the bulk wine labels of The Wolftrap and Porcupine Ridge of which Marc is especially proud – and with good cause. They deliver exceptional value and easy-drinking pleasure for their price. A case in point is the Porcupine Ridge Merlot from the stellar 2015 vintage. Full of charm and soft blue and black fruitcake spiciness, it is an absolute steal at a recommended retail price of R55.

DINNER PARTY The Alvi’s Drift CVC 2015 has two quite significant things working against it. Firstly, it is a white blend – of chardonnay, viognier and chenin blanc – which is a tough sell in a market like South Africa where white wine drinkers have mass enthusiasm for only one grape – sauvignon blanc. That’s despite the best efforts of local and international critics (yours truly included) to sing the praises of the brilliant chardonnays that are now being made, along with the variations that are being added to our long-excellent chenins, and the new-ish and very exciting white blend category into which the CVC neatly fits. Secondly,

it is from unfashionable Worcester, which has the (largely deserved) reputation of growing grapes for distilled products or for cheap and not always cheerful co-op wines. The Van der Merwe’s of Alvi’s Drift are trying, along with a few other visionary souls, to change that perception. And one very important thing working in favour of that attempt, as exemplified by the CVC, is that it is a really, really good wine. It speaks of sunshine and good living, with an enticing palette of peach, apricot and melon, and a richly textured palate.

It is an interesting food partner, especially with Thai food. Superb value at under R90.

OUT TO IMPRESS The Dutch first made wine in the Cape, but it was the French Huguenots that developed and refined the nascent industry. The French influence continues – it provides a benchmark of excellence for local winemakers, and there are significant French people who have a stake in the local industry. The formidable May de Lencquesaing is a leading example. Her family has been in the wine business since 1783. She owned and managed the renowned Bordeaux second-growth property, Château Pichon Longueville Comtesse de Lalande for nearly 30 years. Madame bought Glenelly in Stellenbosch’s Idas Valley (part of a grant made by Simon van der Stel in 1682). Now in her early 90s, she

still plays an active role in the farm and the winemaking, and Glenelly has become a must-visit destination. There’s a superb bistro in the very French hands of Christophe Dehosse; there’s Madame’s world-class Glass Collection – nearly 1 000 pieces from around the world, some dating back to 50BC; and there’s the steadily improving wine, made by Luke O’Cuinneagain with an approach that is characterised by freshness and elegance. The Estate Reserve is the signature blend, matching perfectly the traditional flavours of Bordeaux grapes with the pepperiness of shiraz. It’s marvellously concentrated and complex, and very fairly priced for the quality at just over R200

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ROCK SOLID Words Caroline Hurry Acu Ravne tunnel

ARE THE OLDEST PYRAMIDS IN CENTRAL BOSNIA? THE EVIDENCE IS COMPELLING

When Haris Delibasić offered to show “Professor Sam” a cave near his home in Visoko, 40km north-west of Sarajevo in 2006, little did he know how his personal paradigm would shift.

GORDON INSTITUTE OF BUSINESS SCIENCE

First, he learnt the hills framing his village were, in fact, four vegetation-covered, 30 000-year-old pyramids with an exact zero-degree north orientation. Then, the cave turned out to be the entrance to the “world’s most extensive underground network of tunnels”.

Professor “Sam” Semir Osmanagić, head of Bosnia-Herzegovina’s American University’s Anthropology Department and author of 15 books on ancient civilizations, discovered the Visoko pyramids in 2005 and knew the tunnels were there...somewhere.

“When I showed him the cave, he started excavations the next day and more tunnels emerged within 72 hours of clearing,” recalls Delibasić, senior guide at the dig, now in its 11th year. Delibasić believes the tunnels could stretch for hundreds of kilometres.

“An advanced civilization with technology far superior to anything we have today,

built these tunnels within a single generation by hollowing out the postglacial conglomerate for 3.8km in eight directions – linking the Sun, Moon, Love, and Dragon pyramids. After digging out the tunnels, they added pebbles, quartz crystal and limestone to the excavated conglomerate to build the pyramids,” he says.

We are sitting in the Ravne tunnel network’s “healing chamber” ‒ 2.5km from the Sun pyramid, which at 220 metres, is a third higher than Egypt’s Great Pyramid of Giza. Indeed, the Visoko valley’s ancient name was Egipat, which means Egypt.

Earlier, my husband and I had climbed the Sun pyramid, which affords a great view of Visoko below. The massive concrete blocks that cover all sides beneath the vegetation looked impressive.

Independent analysis from five European universities confirms the material is five times stronger and more resistant to water than any man-made concrete today.

I’m feeling ever so rejuvenated thanks to all the negative ions generated by an egg-shaped 8 000kg monolith – one of three – found in the chamber. Analysis by the Institute for Nuclear Physics in Zagreb proved the 35 000-year-old quartz

monolith covered in man-made ceramic, generates ultrasound frequencies and magnetic energies. Varying ceiling heights further circulate the airflow throughout the network of tunnels.

Comments Delibasić: “No way were pyramids used as burial places. The ancients, who knew the secrets of frequency, used pyramid energy to advance human health, so it can’t ever have been a place for dead people.”

An ultrasound beam with a 10-metre radius and 28-33kHz frequency has been measured coming from the top of the Sun pyramid. Says Delibasić: “This would have made it the earth’s biggest antenna but the tunnels were filled in with soft sand around 4 600 years ago, effectively putting the pyramid on “standby” with just 3% of its capacity. Perhaps this was to prevent the technology falling into the wrong hands.”

Mainstream scientists can scoff if they like. The Bosnian government intends to keep digging.

IT MOSTAR BE LOVE!

Just inland from the Adriatic coast in the southern part of Bosnia-Herzegovina, a crossroads of cultures defines this beleaguered city

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View of Visoko

Edin “Pelko” Pelkovic recalls 9 November, 1993 – the day the Serbians bombed Mostar’s medieval Stari Most bridge into the River Neretva – like it happened yesterday. “I’m not ashamed to say I wept like a baby. I think every Bosnian alive cried that day.”

It’s understandable when you consider that the Old Bridge – constructed on the orders of Sultan Suleiman the Magnificent – dated back to 1566.

The swooping stone arch of the original walkway was rebuilt in 2004 from rubble hauled out of the river, and declared a UNESCO World Heritage Site in Durban on 17 July, 2005. (Durbs hey, who knew?)

Today, daredevil divers fling themselves off the Stari Most parapet, dropping 20m into the Neretva’s icy waters for thrills, chills and cash. You thought bungee jumpers were brave? Pah! The road to Mostar is paved with narrow hairpin bends flanked by shrines and random stalls selling honey, homegrown tobacco and vegetables. With more mountains than Switzerland and a

Bombed building

The Old Bridge

burgeoning wine industry – ironic for a Muslim country, but that’s BosniaHerzegovina for you – the views change from castle ruins to bombed out farmhouses, fruit trees, tunnels, rivers and streams.

Refined by the minarets of many mosques rising like middle-fingered salutes to the Serbians, Mostar lurks in a birch-forested valley. Across the river, twice the length of the tallest minaret, stands the Croats’ new Catholic Church spire. And on the hilltop high above the town, a cross heralds what feels to me like an uneasy truce, but time will tell.

Orthodox Serbs, Catholic Croats and Muslim Bosniaks lived here in seeming harmony before war broke out in 1992.

Croats and Bosniaks forced out the Serbs before turning their guns on each other and the city became a killing zone. With pockmarked walls and shells of bombedout buildings such as the once majestic neo-Moorish Hotel Neretva (built in 1892) and the haunting nine-storey concrete skeleton of the former Ljubljanska Banka, most of Mostar looks as though it was kicked in the teeth.

Old Town

Mostar souvenirs

Small cemeteries congested with white marble tombstones abound. Closer inspection reveals that most died in 1993, 1994 or 1995. According to “Pelko” who lived through the war, snipers would pick off anyone walking down the street – “women, children, they didn’t care”.

Sometimes bodies were left rotting for days on end along the main boulevard.

Today, sizzling in the late summer sunshine, the cobbled streets of the medieval Ottoman Old Town seem picture-perfect and peaceful. However, walking shoes are essential. I nearly broke an ankle teetering over the cobbles in high heels.

Here, as in Sarajevo, entrepreneurial coppersmiths have twisted spent ammunition into intricate sculptures and beaten shell casings into pens, sold at many souvenir stalls.

Accommodation varies from backpacker hostels to mediocre hotels but what Mostar lacks in luxury, it makes up for in historical interest, being a sobering snapshot of war’s inhumanity

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Mostar river

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THE FINER THINGS Words Cheska Stark

GORDON INSTITUTE OF BUSINESS SCIENCE

HIS CHECKLIST 1.

Leather biker jacket, R3 599, Country Road This 100% leather jacket deserves a place in every modern man’s wardrobe. Super cool is that it has been garment tumbled for that vintage lived-in look – the only way to go when buying an investment piece like this.

2.

Dax boot, R1 199, Tread+Miller Step into winter in these 100% suede boots. Wear them with everything from modern tailoring to weekend jeans.

3.

Buckle detail duffel bag, R7 799.95, Ted Baker This understated weekender bag is crafted in 100% leather and hits the mark with all the right details.

With a sturdy construction, this carry-all offers the perfect mix of style and functionality.

4.

Knit, R425, Old Khaki Don’t forget classic basics that are essential to all wardrobes. This easy pullover will be your immediate go-to this season.

5.

Sweater, R699.99, Billabong OK, so it’s chilly and winter? Sometimes all you need is a throw-on sweater – comfy is key, right? This Billabong is the right colour and style so you won’t look like you are off to varsity.

6.

Armani, R2 890, Sunglass Hut Monochrome optical frames are an instant way to update your eyewear without going too out there to wear every day. This Armani pair are subtle enough to not shock your look but bold enough to make a difference.

7.

Jeans, R699, Old Khaki Change up your usual blue jeans for this slim-fit denim pair. Cuffed at the bottom to give them a modern silhouette while the colour is bang on-trend for winter!

8.

Checked scarf, R649, Country Road The must-have accessory for winter is a scarf. This soft, checked one is a great salute to winter. Yes, the check may be predicted but the colour combination is not. Be a man who wears a scarf.

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HER CHECKLIST 1.

Longline coat, R2 199, Country Road Get ready for a stylish winter with this perfect 75% wool coat. Duck-egg blue is this season’s favourite hue – the coat is simple and clean with a long straight line.

2.

Floral knit, R2 699.95, Ted Baker Pair this lightweight Ted Baker knit with a pencil skirt and dark stockings for the office or jeans and your favourite sneakers for a fun weekend look.

3.

Bag, R2 199, Witchery This 100% leather bag is a great shape for women on the go. It can easily be worn crossover or carried on your wrist as a tote.

4.

Jersey/top overlay, R559, Forever New This overlay knit trend is a must-follow, it’s so easy to wear and interpret and gives women who wouldn’t ever rock a crop top the same effect.

5.

Flower printed scarf, R199, Old Khaki The oversized floral trend grabs our attention. A scarf is a must-have for winter – a chic accessory that adds an extra layer to your warm look, without looking like a bag lady.

6.

Ballet courts, R1 299, Aldo At last! The shoe moment we have been waiting for: an update on the classic black court. Perfectly inspired by pretty ballerinas but hard core enough to wear for a long day; these shoes will give your entire wardrobe an instant update.

7.

Dolce & Gabanna, R3 090, Sunglass Hut A pair of classic Jackie O-inspired sunglasses is not to be undervalued. Sunglasses are not an item to just stick with once you have them – updating them every season is a must.

8.

Platform sneakers, R1 499, Superga Hello the newest take on sneakers: the platform sneaker. Wear it with your casual/weekend look, ignore the platform and wear it with confidence. Plus, a little bit of height does everyone a bit of good

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FORWARD MOTION Photographs Jacques Marais Words Jacques Marais and Stephen Smith

With or without an internal combustion motor, here are half-a-dozen ways to get ahead (and stay ahead) of the pack. Funky or fun. Far-fetched or absurd. Classic or alternative. Acumen’s motion maestros check out six incredible ways of having fun while moving from point A to point B…

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HUMAN-POWERED

ON YOUR FEET – HI-TEC SPEED-LIFE BREATHE ULTRA TRAIL RUNNING SHOE

ON YOUR HEAD – LIV INFINITA CYCLING HELMET

ON YOUR BACK – ULTRASPIRE ALPHA 3.0 VEST

WHAT IS IT: The Hi-Tec Speed-Life Breathe Ultra is designed as a trail running shoe so stylish you’ll wear it to drinks with the boys (or girls)! Their construction provides your feet with personalised comfort and a secure fit thanks to their floating lacing system.

Plus, the PU Ergo Frame adds extra ankle support as you adventure along tougher terrain.

WHAT IS IT: The new Liv Infinita helmet is an extended coverage-style mountain biking helmet. It is aimed specifically at trail and enduro riders, with the design and construction adding additional rear protection when compared to standard cross-country XC helmets.

WHAT IS IT: The UltrAspire Alpha 3.0 Vest uses the same legendary and award-winning design that has shaped the classic style which has made #UltrAspire a household name in endurance sport.

WHY DO YOU WANT IT: Long climbs and flowing descents are where the Liv Infinita WHY DO YOU WANT IT: This slick trail shoe really shines and you’ll be ready with this will never limit where you unwind in the purpose-built helmet, no matter where the great outdoors. It is packed with technical trail takes you. Keep a cool head with 28 features, including the Hi-Tec ‘i-shield’ to large vents and deep channelling which will repel water and dirt. Add an Ortholite® increase air flow and ventilation. It also comes Impressions sock liner (with slow recovery complete with a goggle strap, moveable visor foam) for superior cushioning and multiand an action camera mount. Add a superb fit, directional traction to maximise grip in and you have everything you need to conquer tough terrain. That’s a full-on trifecta: value your next enduro or all-mountain ride in for money, slick design and advanced tech, winning style. all in one shoe!

DESIGN USPs: Huge thumbs-up on including DESIGN USPs: High-performance, synthetic Transtextura Plus™ antimicrobial padding, an mesh uppers and microfleece moisture advanced, natural fibre prohibiting bacteria wicking linings help your feet breathe, while growth by channelling perspiration through the nylon fork-shank and improved gait keep the AirFlow exhaust ports. The Liv Infinita your feet stable and secure on gnarly terrain. also features an integrated GoPro-compatible Moulded, impact-absorbing EVA midsoles mounting surface, also maximising safety ensure lasting cushioning and comfort, while through their MIPS™ Brain Protection system, on-trend colours and design will rock your designed to reduce rotational motion through world. angled impact zones (on selected models).

WHY DO YOU WANT IT: This vest-style pack is perfectly sized and form-fitted, making for total comfort, even over the long haul. The UltrAspire Alpha 3.0 Vest features a zippered back, as well as elasticised mesh compartment for more capacity and versatility. The low-impact and dynamic design will allow you to keep focused and moving consistently, while carrying all your essentials on multi-day endurance events.

DESIGN USPs: Fitted with two easy-toreach bottles and compatible with a 2l hydration bladder, you’ve certainly got your fluids covered. A water-resistant, magnet-sealed pocket on the left shoulder strap can safely store hydration pills and tablets for easy access, while a zipper pocket on the right holds keys or other valuables. Nutrition and apparel fit easily in the rear compartment and can be reached on-the-go via a magnetsealed side opening.

GO GET IT : Available at Sportsmans Warehouse

GO GET IT: From all Giant Performance dealers, or check Giant-bicycles.com/en-za

GO GET IT: Available online from Nativesport.co.za

PRICE: R1 099

PRICE: R1 599

PRICE: R2 280

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FOR THE HEART

FOR THE HEAD

FOR THE PLANET

MOTORISED On the motorised side, we look at three cars similar at first glance, but with many a difference under the hood and inside. Read on and see which appeals to your soul... Toyota, Audi and Mercedes-Benz: these three manufacturers are currently at the forefront when it comes to producing cars with universal appeal.

FOR THE HEART: TOYOTA C-HR

FOR THE HEAD: AUDI A5

WHAT IS IT: A little SUV that reminds one of a time when the RAV4 stirred up the market. Smaller than the current RAV, the C-HR is a left-field alternative in the humdrum world of family hatchbacks and compact SUVs.

WHAT IS IT: When the Audi A5 was launched back in 2007 it defined what a practical, sexy coupé should be.

Now that first generation A5 has been replaced, and the successful recipe dramatically improved upon.

WHY DO YOU WANT IT: A Toyota that appeals to the heart? Yip, it’s true! The C-HR will appeal to the wacky, to the funat-heart, those who want their car to have as much character as they do.

WHY DO YOU WANT IT: Most of you will want an A5 because it is strikingly beautiful. Some of you will want one because it is finished as superbly as all Audis are. And a few will want one because it’s actually a practical car. No really, it is!

DESIGN USPs: Combining the renowned reliability, aftersales service and resale value of Toyota with a fun, creative design makes for a recipe that thousands would have been waiting for. Just three models will be available, all powered by a 1.2-litre, turbocharged petrol engine that produces 85kW and 185Nm, using 6.3 litres of petrol per 100km to do so. This engine can be had with either a 6-speed manual or 6-speed CVT gearbox, both of which are impressive and work brilliantly with the little engine. Ride quality is also excellent for a vehicle of this size, and even when we mistakenly strayed beyond the speed limit the car felt composed and sure-footed on the road.

GO GET IT: The C-HR is priced from R318 500, and a 5-year/90 000km service plan and 5-year/100 000km warranty are standard. Visit Toyota.co.za for more information.

DESIGN USPs: The size of the boot lid of the A5 is one of the reasons I like it – you can fit all sorts through that opening. Other than that, it is great to drive, luxurious to repose in, sensational to look at, and available with variations of two great engines: the 2-litre TDI turbodiesel and the 2-litre turbo FSI petrol. Only automatic gearboxes can be had, but both diesel and petrol are available in a Sport model or with Quattro allwheel drive.

GO GET IT: At the time of print Audi South Africa hadn’t released pricing, but by now the secrecy will have been lifted. All Audis include a 5-year/100 000km warranty and maintenance plan. Visit Audi.co.za for pricing and more information.

FOR THE PLANET: MERCEDES-BENZ C350E WHAT IS IT: You all know what a Mercedes-Benz C-Class is. For decades it has been the epitome of everyman’s aspirational luxury sedan, embroiled in a fierce battle with the BMW 3 Series and Audi A4. The C350e, though, is a bit special – it’s a plug-in hybrid that uses electricity and petrol as tandem power sources.

WHY DO YOU WANT IT: A businessman with a short commute, to whom a claimed fuel consumption figure of 2.1L/100km appeals, is the person I imagine buying this car. It’s luxurious, fast, quiet, and you can even argue that it’s a responsible purchase.

DESIGN USPs: Hybrid models are becoming more and more prominent in manufacturers’ line-ups, and in the developed world are accounting for more and more sales. The C350e is a plug-in hybrid, which means that you plug the car into an electric socket to charge the batteries, which can propel you for up to 30km without using the petrol engine.

So for a short commute, you could get by without filling your car with petrol during the week. And when you do need the 2-litre petrol engine, it’s there, producing 155kW and 350Nm.

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GO GET IT: The C350 e is priced at R804 900, including a 3-year/60 000km maintenance plan. Visit Mercedes.co.za

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TECHNO Words Aki Anastasiou

SAMSUNG GALAXY S9 AND S9+

Samsung is back with a bang (not literally, this time).

Price starting at around R13 000 Let’s be honest, 2016 will be the year Samsung wants to forget following the disaster of the Note 7.

No surprise then that at the launch of their flagship new devices the S8 and S8+ in New York in March, Samsung’s head of mobile, DJ Koh, emphasised safety, quality and craftsmanship in the new devices. This includes an 8-point safety check on batteries.

These are sleek, fast and beautifully designed phones. They feature what Samsung calls an “infinity display”, which manages to push the screen right up against the bezel, giving you the impression that you are holding a piece of glass in your hands. Quite extraordinary! The home button is gone and is now embedded into the glass display at the bottom. Samsung has also introduced the Bixby intelligent assistant to the new phones. Bixby is a smart assistant similar to Apple’s Siri, which recognises your voice and even has the ability to recognise photographs.

Samsung hopes to embed this personal assistant into all their appliances so ultimately Bixby will be in almost everything you do on the phone. Samsung has also increased security on the device: optionally, the front-facing camera can scan your retina to unlock it. This is over and above using a password or the fingerprint scanner. The S8 is 5.8 inches in size whereas the S8+ is 6.2 inches with a bigger battery and display. Samsung has a considerable amount riding on these devices and consumers will not be disappointed.

NINEBOT MINIPRO

GORDON INSTITUTE OF BUSINESS SCIENCE

A new way of mobility Price R10 000

I had so much fun with the Ninebot miniPRO! It may sound like a toy but believe me it isn’t. This is serious kit. You’ve already probably come across the big brother – the Segway human transporter used mostly by security personnel in shopping malls. The miniPro is the Segway’s baby brother and it’s a sophisticated robot. It takes a few minutes to learn how to manoeuvre and keep your balance.

In my case, based on my clumsiness track record, it took me double the time.

But once you get the hang of it, it is an amazing experience. It has dozens of sensors that are measuring the movement of your body as much as 200 times a second to help you maintain balance. Using your knees to guide from left to right and your body’s slight forward-leaning motion to move straight the miniPRO can travel at around 6km per hour – 4 times faster than we walk. It has a range of around 30km on a single charge! It also works with an app that can be used to guide the Ninebot remotely. This is not designed for young kids but more for adults who want to be young kids again. Or for people like me who never quite made the transition into adulthood.

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HUAWEI MATE 9

The workhorse of the smartphone world Price R11 000 Huawei’s focus on efficiency, engineering and build quality is very evident in the new Mate 9. This phone is a beautifully designed workhorse. Crafted in a solid aluminium body, Huawei’s flagship device is designed for users who demand performance. The large 4 000mAh battery is designed to give you two full days of work and also has SuperCharge technology built in to give you a full day with just a 20-minute charge. The 5.9-inch device is packed with every feature you could ask for in a phone, making it a proper work tool that is solid and delivers on performance especially on connectivity. It also has the latest Leica Dual Camera system that takes fantastic photographs and shoots 4K video. Huawei has also focused on voice quality. The Mate 9 is equipped with four microphones with built-in noise-cancelling technology to eliminate background noise and improve voice quality.

If you’re looking for a stylish phone packed with features, a big screen and an impressive battery then the Huawei Mate 9 is for you. It’s the Swiss Army Knife of mobile phones.

APPLE AIRPODS

Wireless functionality with ease Price R2 599 When Apple announced the wireless Airpods last year many had their doubts about usability. Let’s be frank here…they do look awkward and it takes a few days to adjust to wearing them and putting up with the stares from people quietly saying to themselves “that’s the guy with the weird looking things in his ears”. It’s called envy. They are simply like hens’ teeth right now. People have realised they are actually quite functional. Once you start wearing them you forget they are in your ears. They come in a small container that also charges them. As soon as you open the container and take them out, your phone automatically recognises them and as soon as they’re in your ears they are ready to use. This is the magical genius of Apple products – they just work seamlessly. Inside the actual headphones is where the magic happens to give you that 5-hour listening time. They have Apple’s W1 chip that does all the noise cancelling and wireless connectivity. And if you’re brave enough to wear them at the gym, or go running with them, don’t worry, they stay on, even when you get sweaty

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BOOKS Words Chris Gibbons

AGE OF DISCOVERY

IAN GOLDIN AND CHRIS KUTARNA – BLOOMSBURY TAKEALOT.COM I R394 With technology driving global change at a relentless pace, authors Ian Goldin and Chris Kutarna believe that the world is going through what they call a ‘New Renaissance’. Where it is leading and how it will end is uncertain, but their plea is for us to understand the process and be aware that it carries extraordinary opportunity as well as huge risk.

GORDON INSTITUTE OF BUSINESS SCIENCE

BUSINESS WRITING FOR SOUTH AFRICANS

Their argument is underpinned and illuminated by reference to the original Renaissance, which took place in Europe, centred on Florence, between roughly 1450 and 1550. This was the period that gave the world Da Vinci, Michelangelo and Botticelli, as well as Machiavelli, Galileo and Copernicus to pick just six names from an extraordinarily long and rich list.

BITTIE VILJOEN-SMOOK, JOHAN GELDENHUYS & WENA COETZEE TAFELBERG I R230 Do you struggle with things like business letters? Reports? Even email? If the amount of rubbish that gets through my spam filter is anything to judge by, it would seem a large number of people do.

At the heart of the Renaissance was Gutenberg’s printing press, with its movable type. At the start of the period, learning was restricted mainly to members of the clergy and speakers of Latin. Libraries consisted of a small number of hand-drawn manuscripts. A century later, the world was awash with books and pamphlets, every city had dozens of printers and knowledge flowed freely in a way that the world had never before seen.

Relax. Help is at hand from this new guide, with its commendable commitment to plainlanguage writing. If you haven’t heard of plain language, it is exactly what it sounds like: English written without jargon, pomposity or complexity and in such a way that ordinary people like you and me can understand it. Or, as George Orwell put it, “Never use a long word where a short one will do.”

Goldin, a former MD of the Development Bank of Southern Africa and Vice President of the World Bank, is now a Professor of Globalisation and Development at Oxford University, where he founded the Oxford Martin School, a multidisciplinary think tank. Kutarna is a Fellow of the Oxford Martin School. The breadth of their learning is formidable but they develop their case in a highly readable way.

As well as chapters on business letters and emails, it also contains sections on technical writing, minute-taking and proposals. My only quarrel is with the chapter on presentations, which starts off by asserting that “PowerPoint has become the norm for visuals in most business presentations.” It then gives advice on how to get PowerPoint right. A far better strategy is not to use PowerPoint at all – you’ll be much more effective.

So it is today with the Internet, unbounded digital networks and petabytes of data coursing to every corner of the planet.

The first Renaissance did not end well: wars broke out and the forces of the Counter-Reformation led to savage institutions like the Spanish Inquisition.

Goldin and Kutarna explain that this was very much a reaction of people deeply unsettled by such unprecedented change. They caution that similar forces – nationalist, populist, protectionist, xenophobic – are also at work today.

Networks can spread evil just as effectively as good, they remind us, and point to ISIS’s ability to recruit using social media.

Intriguing, challenging, thought-provoking, Age of Discovery is a book that ought to be read by every senior policymaker in as many global capitals as possible.

Sadly, it seems unlikely that it will reach the bedside table of the people who most need to learn from it – Donald Trump, Vladimir Putin, Jacob Zuma and their ilk.

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TIME TALENT ENERGY

MICHAEL MANKINS, ERIC GARTON – HARVARD BUSINESS REVIEW PRESS KINDLE EDITION I $17.27 HARDBACK FROM AMAZON.COM I $19.65

E-COMMERCE: DYNAMIC MARKETS PERSPECTIVE

KERRY CHIPP, ZENOBIA ISMAIL, ELLENA MEIRING – 2ND EDITION VAN SCHAIK PUBLISHERS I R499 Whether you’re studying e-commerce, running a start-up with unicorn ambitions, or just want to know what’s what in this sector, Chipp, a senior lecturer at GIBS, and her collaborators, Ismail and Meiring, have produced a must-read.

It is, first and foremost, a textbook, properly researched, referenced and laid out, and as such, perfect for the serious scholar. But don’t let that put you off. I have more than a passing interest in e-commerce but within 30 minutes of opening my review copy, had learned a host of new facts.

I didn’t know, for example, that Exclusive Books, which I think of as a bricks-and-mortar operation only, was recently named as a Top 10 South African online store.

More important, perhaps, is the systematic nature of the textbook approach. With such thorough tables, chapter headings and subheadings, anyone operating in the e-commerce sphere could go through the book reasonably quickly, using it as a tick-box manual to double-check their own operations and thinking. Then, if they were to find something that they had forgotten or not properly considered, they could settle down and read more about it in depth.

This one gets a “Highly Recommended” tag.

If strategy is about deciding where to go, how to get there and what resources are going to be needed along the way, then the successful execution of strategy is almost always about how those resources are deployed. Mankins and Garton, both very senior experts in organisational design and effectiveness at Bain & Company, argue that in this process too much weight is given to financial capital.

Instead, they suggest that companies need to pay a great deal more attention to the resources which make up the title of their book, Time, Talent and Energy, which they describe as “truly scarce”.

As you might expect, the book is divided into three sections but it’s the first one, Time, which carries the most resonance.

Mankins and Garton use a term I haven’t come across before to encapsulate the core time-related problem: organisational drag. It describes all the time-wasters inside the company, chief amongst them meetings, emails and phone calls.

Whilst some are necessary many are not and the authors assert that “the average company loses 21 percent of its productive power, the equivalent of a day a week, to drag.” The claim is based on research conducted for Bain & Company by the Economist Intelligence Unit, so that’s likely to be a very solid figure.

Their analysis of the problem is penetrating and frightening, including the fact – obvious if you think about – that “a meeting at the top can produce ripple effects throughout the organisation that consume significant time and money.” They detail how, at one large industrial company, a weekly meeting of senior leaders consumed directly 7 000 hours a year of organisational time. If that’s not scary enough, second-order meetings to prepare for the big one ate up another 63 000 hours. Add in all the preparatory emails and data collection and it became clear that the bosses’ weekly gathering consumed more than 300 000 hours per annum.

Their suggestions on what to do about this problem are common sense: run meetings that work and simplify the operating model (and they cite Sasol as a compelling example of the latter). But given the nature of companies, that’s a great deal easier said than done, a fact the authors acknowledge.

Parts 2 and 3 about Talent and Energy are less compelling. That’s not because what Mankins and Garton say is wrong – far from it, it’s very accurate – but simply because I don’t feel it’s as original as their insights into time. Don’t let that put you off, though. Buy the book; in this case, it will be time well spent

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GORDON INSTITUTE OF BUSINESS SCIENCE

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Natalia Molebatsi

SPEAK TO ME, SING TO ME Words & Pictures Victor Dlamini

Multitalented Natalia Molebatsi defies attempts to pigeonhole her art.

If the poet Nikki Giovanni is associated with poetry fused with jazz instrumentals, her 70s experiment has become something of a staple to a new generation of poets who straddle the worlds of jazz and verse. Natalia Molebatsi, from Tembisa on the East Rand, draws not only from Giovanni’s playbook, but that of the jazz poet, Jayne Cortez. Her costumes and headgear reflect her belief that on stage, the artist performs not just their art, but their own appearance as well.

Molebatsi’s performances are always rooted in her deep love for words, particularly the spoken word, and her deep voice booms gentle across the stage as she mesmerises the audience. One of her most powerful poems has these words: i wish you whole as words water a flower beneath the yellow rays of yearnings beyond the reach of growling pains...

Then there’s this line that brings her love for music full circle: hey music man promise you will live a long very long time and when you die one day like all natural beings do...

She has performed across the world, and was featured at the London Olympics in 2012. Two years later she was invited to perform at the Buenos Aires Book Fair. She then took her band to the Berlin Literature Festival. She has also performed in Ake and Lagos in Nigeria, and in Ramallah, Palestine.

“There’s a magic that comes from performing on stages across the world. Even when I perform for audiences who may not understand my Setswana or even my English, there’s a deeper connection that the music creates. This is why performing my poetry to music is an important part of my practice,” explains Molebatsi.

MINGUS

It’s no surprise to discover that Molebatsi writes to the music of Charles Mingus. She says she is drawn by his ideas, his orchestration and above all his use of colour in creating music that is at once deeply technical even as it is moving. Like Mingus, Molebatsi is a purist who knows how to charge her lyrics with both politics and love.

Over the past few years, Molebatsi has given some of her most inspired performances at Braamfontein’s The Orbit. “I love The Orbit. It oozes an unapologetic jazz culture. As an artist,

Natalia Molebatsi

it is important that you know when you enter a space that all the elements are aligned. For me spaces aren’t just physical,” says Molebatsi. She also loves the Johannesburg-based African Freedom station for what she calls “its authenticity and laid-back mood”.

It should come as no surprise then that when Molebatsi puts together a band, the first person she calls is double-bassist Lex Futshane. He has that rich sonorous tone associated with Mingus. She also relies on guitarists Themba Mokoena and Jimmy Dludlu to accompany her in song. “I love how these musicians accompany my words. They make my work whole. I feel safe and can completely let myself go when working within the ‘musicianship’ they provide”.

Molebatsi says that she carries within her both the traditions of storytelling and those of resistance. “I grew up to the stories that my mother carried from her own childhood. These are the ones that turned me to the wonder of poetry. But I knew that the world was in need of changing, and so in my work are always the seeds of change, of revolution. Because we must leave this a better world than we found it,” she says.

This singer/poet/MC/writer defies convention and soars beyond categories. Hear her especially on the magical song Soul Making in which she borrows, not from jazz but rock, to remind us that the line from Brenda Fassie to Grace Jones and Natalia Molebatsi is one etched in the spirit of fierce feminism and bucketloads of talent. On the song Sinamandla you can hear the influence of the church and the stage in her music.

Still only in her 30s, Molebatsi is one artist to watch

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looking backwards

MAIL NOT TO ORDER Words Sam Cowen

Sometimes the algo- has quite the wrong -rithm.

The other day I opened my inbox to find a mail with this in the subject bar: “Become the lover you want to be NOW!” It seemed so urgent and exciting! Now! Right now! I had never considered what lover I wanted to be, but this email made me wonder if there was indeed a solution to a problem I never thought I had.

Well it wasn’t. Firstly it was for a man. It extolled the virtues of a HOME RECIPE that took THREE MINUTES to make and guaranteed up to THIRTY MINUTES of extra…talktime.

GORDON INSTITUTE OF BUSINESS SCIENCE

Secondly, there was a small red square I would have to click on, should I wish to get this FREE home recipe which was biologically useless to me. “Ha!” I thought.

“I would never be so stupid as to click on that. That would lead to all sorts of spam.”

And I conveniently ignored the fact that I had opened the original mail already.

The next day there were 69 new emails in my inbox. (Yes, really, 69. You can’t make this stuff up.) None of them were work related. The first one I opened (no, I hadn’t learned from the first time) was to congratulate me on being approved for a Russian mail order bride. I was confused.

I had never applied for a mail order bride, Russian or otherwise.

The next morning over 100 new emails were waiting for me. But these were very different. The first one I opened was from hummingbirds.net offering me a discount on a hummingbird feeder. What filthy sexual position or device is this, I wondered? What might ‘hummingbird feeder’ be code for in Urban Dictionary?

It’s code for…hummingbird feeder.

For hummingbirds. It contained a

lovely picture of happy hummingbirds on a feeder, and some helpful suggestions on how to fill said feeder.

Another mail tried to sell me a walk-in tub. Do you know what that is? It’s a chair-like tub for people for whom getting in and out of a traditional bath is difficult.

It’s for old people, or, as the mail explained, people in their ‘golden years’.

I am not in my golden years.

I am 43.

Hot on its heels was an email from someone styling himself Dr. Wonder and promising to reverse my diabetes (I do not have diabetes) with “an odd little ingredient” that was “not a prescription drug”. That merged nicely into the next mail which committed to revealing a mystery biome that would cut my bad gut bacteria forever. And forever is like...forever!

“The secret Donald Trump doesn’t want you to know!” came next. From what I’ve read on mainstream media, there are many secrets Donald Trump wouldn’t want me to know, but, as discovering this one would mean clicking on a ‘shock’ video, I’m afraid I remain in the dark about that. Only metaphorically in the dark however, because if I had clicked on the link in the email from Shadowhawk flashlight, I could have got 75% off “the world’s brightest flashlight”.

We are constantly bombarded with spam advertising, based allegedly on our browsing habits, our online shopping, even our friend lists on social media.

This makes sense. Someone who buys boots online might like a jacket and someone who likes mail order brides might well want a 24-hour erection. I would, however, pay money to find out what algorithm or formula was used on me. Because as things stand, if my life had to mirror my mails, I would be sitting in my tub bath right now, looking out of the window at my hummingbirds happily chirruping on their feeder, while Svetlana or Olga cooks up a diabetes home remedy in the kitchen.

Also I’m not sure where Donald Trump would fit into the picture unless it’s to look at whoever decided that all these things were a perfect fit for a happily married 43-year-old South African woman without diabetes, point at him or her across a boardroom table and say, “You’re fired.”

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(Unless, of course, the same algorithm qualified Melania as a Slovenian mail order bride?)

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