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South African Business Integrator aligning business with government September/February 2015
Entropy and SA’s dilemma on visa regulations Incentive plans that work Macroeconomics: True understanding at all levels What no-one tells you about expanding into Africa www.sabimag.co.za
Gearing up for government tenders
Current Affairs I Economic Development I Business Integration
COVER STORY
A unified voice In January 2015, Ms Khanyisile Kweyama was appointed as the CEO of Business Unity South Africa (BUSA). Her mandate is to ensure that BUSA continues to play its role as the unified voice of business and enhance its position as an organisation that best represents the interest of business. Business Unity South Africa (BUSA) is a confederation of business organisations that includes chambers of commerce and industry, professional and corporate associations, and unisectoral organisations. It represents South African business on macroeconomic and high-level issues that affect the country at national and international levels. BUSA’s function is to ensure that business plays a constructive role in the country’s economic growth, development and transformation, and to create an environment in which businesses of all sizes and in all sectors can thrive, expand and be competitive. As the principal representative of business in South Africa, BUSA represents the views of its members through a number of national structures and bodies, both statutory and non-statutory. BUSA also represents businesses’ interests in the National Economic Development and Labour Council (NEDLAC). Internationally, BUSA is a member of the International Organisation of Employers (IOE), the Pan-African Employers’ Confederation (PEC), the Africa Employers’ Group, and the Southern Africa Development Community (SADC) Private Sector Forum. BUSA is also the official representative of business at the International Labour Organisation (ILO), the African Union (AU) Social Affairs Commission, the B-20, the
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Organisation for Economic Cooperation and Development (OECD), and the World Trade Organisation. 2015 marks 21 years of democracy in South Africa. While progress is registered on many fronts, the South African economy remains challenged by multiple obstacles. Unemployment, the energy crisis and labour relations, among others, continue to pose challenges for the country. However, during 2015, BUSA continues to play its role as the unified voice of business and enhance its position as an organisation that best represents the interest of business. Effective from January this year, Ms Khanyisile Kweyama was appointed as BUSA’s chief executive officer. One of her priorities is the continued dialogue with government aimed at improving relations between government and business as BUSA forges ahead with the implementation of the National Development Plan (NDP). ‘We continue to engage with government on priority areas dealing with labour relations, education and training, inclusive growth, infrastructure, and regulatory environment as we believe these are areas of critical importance for the achievement of the NDP vision 2030,’ says Ms Kweyama.
No stranger to challenges Ms Kweyama is no stranger to challenges. She is a highlyaccomplished and professional businesswoman, and a
COVER STORY
mentor to many aspiring young men and women. She launched the first ever women in business master class series at BUSA in partnership with the Black Business Council and the Institute of Directors Southern Africa. The master class series was an initiative to commemorate women’s month by acknowledging the contribution by women to economic growth and development. Her goal is to see business championing and embracing transformation in the work place. The women in business master class series provided a platform for leading women in business to share their journey and inspire young women who aspire to become leading women. She was the first woman to hold the position of executive director at Anglo American in South Africa, and was a member of the Anglo American group management committee (GMC). Ms Kweyama was appointed as chairperson of the Anglo American Zimele Board, she served on the boards of Kumba Iron Ore, Anglo American Platinum, and currently serves on the boards of Telkom South Africa, International Geological Congress, Sentebale, Defence Force Liaison Council, and Keymix Investments. In addition to this, she was elected as the vice president of the South African Chamber of Mines in 2013 and 2014. As an accomplished businesswoman, Ms Kweyama set up her own consulting companies – Nokusa Communications and Promotions, and a human resources consultancy, KTK HR Solutions. She has gained extensive managerial experience working for various reputable organisations such as BMW, Altech and Barloworld. She was recently honoured as the Most Influential Women in Mining in Africa by CEO Communications, and has been listed as one of the Top 100 Women to Watch in the FTSE 100 Companies 2014 report. She served as a member of the Commission for Employment Equity (CEE) – a Section 9 body established to advise the Minister of Labour – and also served on the NEPAD board. Ms Kweyama holds a Postgraduate Diploma and a Master’s Degree in Management from the Wits Business School, and also completed various executive development programmes with GIBS and other institutions. Her plan is to implement the new BUSA vision, leveraging policy standing committees that include the Social and Transformation Policy Standing Committee, and the Economic and Trade Policy Standing Committee. ‘These committees demonstrate BUSA’s dedication to ensuring that organised business plays a constructive role in ensuring an economic and socio-economic policy environment conducive to inclusive economic growth, development and economic transformation,’ Ms Kweyama explains. BUSA has membership of more than 60 associations and businesses spanning national organisations, membership from Chamber movements, sectoral bodies and professional organisations. ‘Together, we continue to steer and influence the policy debate in the interest of business.’ To this end, BUSA participated in various NEDLAC negotiations on major policy and legislation, including making comments through public comments processes and presenting its submissions to Parliament Portfolio
Committees. Throughout these processes, BUSA ensured policy positions were mandated by members and convened various engagements with social partners to ensure that business’s voice is heard. During 2015, BUSA engaged on an array of issues that include: • Presidential business working groups • President stakeholder engagement on xenophobia • BUSA Business Against Xenophobia Colloquium • BRICS Business Council • AGOA • Task team on energy • Operation Phakisa • Interaction with foreign missions and trade representatives
Forging ahead ‘I look forward to ensuring that BUSA continues to play a strategic role in advancing the views of business in policy formulation. As we forge ahead with this task we will remain focused on our mandate and improve our value proposition to members,’ Ms Kweyama maintains. She adds that BUSA’s goals in this regard are to: • Impact the stimulation of economic growth. • Continuously improve its mandating processes and ensure that BUSA policy positions reflect the views of its members. • Ensure that these positions are adequately articulated at NEDLAC and during engagements with stakeholders. • Ensure that business is well represented at all relevant statutory bodies. • Partner with relevant organisations and leverage the capacity and expertise of members to deliver on BUSA’s mandate. • Continue to facilitate funding to support research on key business policy issues to enable evidence-based policy dialogue. • Maintain existing and establish new partnerships with key government departments for policy advocacy. • Engage organised labour with the aim of establishing common ground on key policies and legislation. • Continue participating in international structures, such as the International Labour Organisation, International Organisation of Employers, B-20, Business Africa and the SADC Employer Forum, and ensure that BUSA leverages capacity building opportunities on behalf of its members. n
Business Unity South Africa (BUSA) T +27 011 784 8000 W www.busa.org.za
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Contents n COVER STORY
n FEATURES Expanding into Africa? Why, or why not?..............................10 The effectiveness of the board.................................................13 Assistance with new B-BBEE codes.....................................18 Gearing up for government tenders........................................19
n OPINION The elephant in the room............................................................22 History speaks: Your memory be damned..............................25 Entropy explained – South Africa’s dilemma on visa regulations.......................................................................28
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A unified voice................................................................................ 2
n ADVERTORIALS Black Management Forum Investment....................................14 eDeaf: Upskilling young Deaf learners....................................35 The Tax Shop: A one-stop shop...............................................39 Collaboration for socio-economic development...................64
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Managing Millennials...................................................................30 Incentive plans that work............................................................33 Enhancing employee engagement...........................................36
n FINANCE & BANKING SA’s first secure classifieds payment and delivery system.....................................................................38
n SMEs & ENTREPRENEURS Cash is king...................................................................................40 Power of business mentorship.................................................42
n MARKETING & COMMUNICATION The state of the marketing address.........................................44 The influence of digital marketing............................................47
n SUPPLY CHAIN Supply chain impacts: Are you ready?...................................50 Curb logistics costs, secure economic growth....................52
n HEALTH & SAFETY Reduce stress and HaveHeart..................................................54
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n HUMAN RESOURCES
n TECH TALK Best iPhone alternatives.............................................................56 6½ Considerations for securing the home office.................58
n SOCIAL INIATIVES A bank with a difference.............................................................60
n COMPANY PROFILE Macroeconomics: True understanding at all levels..............62
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ADVERTORIAL
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South African Business Integrator
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South African Business Integrator
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ALIGNING BUSINESS WITH GOVERNMENT September/February 2015
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Entropy and SA’s dilemma on visa regulations Incentive plans that work Macroeconomics: True understanding at all levels What no-one tells you about expanding into Africa Gearing up for government tenders
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Current Affairs I Economic Development I Business Integration
Cover Credit: Business Unity South Africa (BUSA)
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South African Business Integrator ALIGNING BUSINESS WITH GOVERNMENT
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Entropy and SA’s dilemma on visa regulations
Colds vs flu – know the difference
Kingspan Insulated Panels:
Incentive plans that work
Delivering performance
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Death-defying vaccination
Macroeconomics: True understanding at all levels
Nightmares and night terrors
Green Goals
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What no-one tells you about expanding into Africa
Encapsulating creativity Issue 15 • July - October 2015
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VOLUME 3 | 2015
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Editor’s L E T T E R
Employee engagement and competitive advantage
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I’ve always been fascinated by the interplay between management and personnel, how companies communicate with their staff, and how employee engagement levels affect a company’s bottom line. During my career I’ve had some excellent business managers, and a couple that quite frankly didn’t inspire me. I’ve always tried to put my best foot forward but, in hindsight, I’m keenly aware of the managers who brought out the best in me and those that didn’t. I’ve also been extremely lucky to have had two incredible bosses/ mentors who not only taught me my trade and helped me to hone my skills, but also instilled valuable lessons that have shaped me professionally. Engaged employees are one of the key ingredients for your businesses’ success. According to Jack Welch, former CEO of General Electric, ‘there are only three measurements that tell you nearly everything you need to know about your organisation’s overall performance: employee engagement, customer satisfaction, and cash flow. It goes without saying that no company, small or large, can win in the long run without energised employees who believe in the mission and understand how to achieve it.’ A study commissioned by Dale Carnegie, reveals that engagement, the employee’s commitment to his or her organisation and the willingness to perform beyond expectations, is closely linked to personal relationships between managers and their staff (page 36). There are only three This is a belief echoed in our feature about Nancy Aspeling, measurements that tell founder and director of Naspeling, who strives for the transfer you nearly everything you of knowledge, true understanding and interpretation of need to know about your macroeconomics at all business levels. organisation’s overall She maintains that the competitive advantage in any business is performance: employee mainly rooted within the quality of its human capital. Those ordinary people with the distinct ability to make customers come back for engagement, customer more, the catalysts who inspired others with their confidence and satisfaction, and cash flow. enthusiasm, those who contribute to business growth and want to It goes without saying that be there because they are driven by the stimulus of feeling valued. no company, small or large, This, Nancy believes, is the deal maker or breaker, and the missing can win over the long run ingredient in the makeup of the contemporary workplace in dire without energised employees need of confident people who take pride and ownership in what they do. To read the full story, turn to page 62. who believe in the mission Engagement is more than mere job satisfaction. Fully engaged and understand how to employees are motivated and dedicated to making an organisation achieve it.” a success. At the most simplistic level, engaged employees lead to happy, loyal customers and repeat business. Engagement also Jack Welch, former improves staff retention levels – employees don’t leave companies, CEO, General Electric they leave people. In short, engagement impacts the bottom line.
editor@sabimag.co.za
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FEATURE
Expanding into Africa? Why, or why not? Your Africa growth initiative should begin by answering this question: ‘Why expand up into Africa?’ Why not the Americas, Europe or the East for example? David Hendrie, who has vast experience taking business up into Africa, shares his insights into what no-one tells you about Africa. I begin my Africa Workshop sessions with some ‘mind focussing’ facts: • People living on less than one dollar a day are some of the most discerning and loyal consumers on the planet. • When you are living on the poverty line you cannot afford to make a mistake. • Just three countries in West Africa have 225-million people, and in East Africa just four countries (all bordering each other) have 145-million people. • Urban populations in Africa will triple by 2050 – creating more easy-to-reach target markets (versus rural populations). • One out of every five Africans is Nigerian. • The middle class is exploding in growth. I could go on. The numbers are staggering and to fully grasp the implications you have to ‘connect the dots’. Exploding middle class equals demand for houses, which equals demand for cement, demand for appliances, and demand for power, etc.
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Behind these very impressive statistics are a number of challenges facing companies and entrepreneurs looking to drive their businesses up into Africa. Not least of these include: • Poor infrastructure • Currency volatility • Lots of red tape (watch trying to take short cuts – you will get burnt) • Corruption (although not nearly as much as I first expected) • Lack of good property close to city centres • Getting money out (many companies reinvest for a number of years).
Learning the hard way For Simba Pepsico, I was responsible for 33 countries in sub-Saharan Africa and learnt the hard way (on the dusty ground) some valuable lessons about doing business in Africa. Here are a few of the lessons I learnt, and call:
FEATURE
‘What no-one tells you about doing business in Africa’: • Managing your Africa expansion strategy and execution is a full-time job if you want any chance of succeeding. Don’t let anyone tell you differently. It is not a tourist excursion. You have to get into the countries personally and frequently. I have always believed that your eyes don’t lie. You have to take them up into Africa to uncover what’s really happening. • There are no quick wins in Africa – it usually takes very patient money before you see returns so you have to put a stake into the ground and make a start. • Because it takes patient money, you have to get the board to buy into your Africa strategy early in the initiative. • You build your business street by street, block by block, and village by village. • I learnt personally that my global brands that make millions of dollars in North America and Europe are frequently unheard of in rural villages (where 70% of the populations live) and in the cities. A humbling experience. • South Africans are generally disliked throughout Africa because of our arrogance (and sporadic xenophobia out-breaks). You have to work hard to overcome this but it is possible – I did it. • If you have a strong internal value code of conduct it will be tested, frequently, when the issue of bribery arises.
Expansion rationale Your rationale might revolve around your successful experience in South Africa (very dangerous as I will explain later), or proximity from a logistics point of view (also very dangerous). The allure of expanding into Africa might centre on the large populations, or relatively high per capita GDPs, or stagnant growth in South Africa. Low barriers to entry, few or no competitors, government incentives, or a well-developed consumption habit already in place, may be part of your rationale to expand. Having laid out your expansion rationale there are a number of options to consider in your plan. Among them are: • Export from South Africa or import from another country – I did both. • Make locally or appoint a packer/assembler. • Go it alone with a greenfield site, or negotiate a joint venture. • A mix of the above?
will face is getting reliable, meaningful data to underpin your strategy, your feedback measurements, and your sensitivity analyses. Maybe I’m old school, but I regard country visits as invaluable (what your eyes tell you, networking, and speaking to people in the street). Obviously the internet is powerful, up to a point, and the CIA global website is, in my opinion, one of the very best for demographics, political background, and industry statistics. I once visited the public library in Addis Ababa, Ethiopia, to find a specific piece of information for an assignment I was working on. Local government agencies, consulates and shipping companies have also been very useful. On an individual skill-set level my personal opinion is that to be successful in your Africa expansion initiatives, you need a healthy dose of: • Curiosity – never assume anything, Africa will surprise you. • Humility – remember what I said about South African arrogance. • Boundless energy – it’s hot, humid, often very dry, and a long way away. • Relentless focus on the journey started. I spend a lot of time in my Africa Workshops covering critical areas such selecting, managing and paying/ incentivising distributors/agents from 5 000+ km’s away, critical internal processes for your export department, currency management, logistics realities, preparing to travel (planning the business objectives, what to pack, and how to behave once you are up there), among other topics. In summary, there are five mistakes that I continually remind people to avoid when doing business in Africa: 1. Assuming Africa is one country – there are vast differences. 2. Assuming the consumers are all the same – even the experts fail here. 3. Not planning for the vast distances between markets. 4. Assuming that all of Africa is corrupt. 5. Assuming that your Africa expansion will be instantly profitable. Good luck, and I hope to see you at my Africa Workshops. n
Early wins Are there any early wins to be had? Remember you have to keep your board or investors or bankers interested – Africa requires patient money! It’s very important to define the size of the prize with crystal clarity for all to buy into, and keep them off your back while you are getting on with the job. Also, one of the biggest challenges you
David Hendrie, Gateways Business Consultants
David Hendrie specialises in supplier/retailer sales and marketing relationship strategy at Gateways Business Consultants. His experience covers 38 years in FMCG sales, marketing and logistics at four multinationals and includes 24 years as a main board director. He is passionate about negotiation, a subject that he loves to teach to both suppliers and retailers. For more information, call T +27 083 645 0088.
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FEATURE
The effectiveness of the board Professionalising the practice of directorship could help state-owned enterprises overcome governance crisis. South Africa’s state-owned enterprises have a key role to play in delivering services to citizens and in funding the National Development Plan. However, it is clear that many major parastatals are still not in a position to fulfil this mandate. A recent editorial in Business Day places the blame squarely on a lack of governance. Parmi Natesan, Executive: Centre for Corporate Governance at the Institute of Directors in Southern Africa (IoDSA) broadly agrees, arguing that solving this problem begins with the board. ‘The challenges besetting our parastatals are complex, so it would be naïve to suggest that there is a silver bullet that can magically fix them. But, as many commentators have pointed out, one common shortcoming is the effectiveness of the boards. One of the findings of the IoDSA’s board appraisals benchmark study was that public sector boards lag behind private sector boards in their performance. Given that boards play such an important strategic and governance role, the IoDSA believes that the parastatals should seriously consider a professionalisation mandate including Chartered Director(SA)’s for the boards of state-owned entities,’ Natesan points out. She adds that greater attention needs to be paid to the selection of board members at parastatals to ensure that they have the necessary professional and personal skills, as well as industry knowledge and experience. ‘It’s vital that proper due diligence on potential directors is carried out. Being a director is a tough job, particularly in the public sector, and much depends on his or her performance,’ Natesan maintains. ‘Care must be taken to find and appoint such people, or the board, and ultimately the company’s, performance will be adversely affected.’ According to Angela Oosthuizen, CEO at the IoDSA, the directorship role in both the public and private sectors is so important and so complex now that the IoDSA has launched a formal professional designation, the Chartered Director(SA), or CD(SA). The IoDSA’s intent is to professionalise directorship. The CD(SA) initiative recognises that directors require specialist skills, experience and integrity alongside their purely business skills.
Administered by the IoDSA, the CD(SA) designation gives directors a way to demonstrate their qualifications objectively, and to enhance them through a formal continuous professional development programme. Professional directors also subscribe to a code of professional ethics, and can be subject to the designation being revoked under certain circumstances. A credible professional designation also helps selection committees identify candidates with the right skills, objectively assessed. Oosthuizen says that government is aware of the potential for using the CD(SA) designation as a way of identifying the right calibre of directors. ‘Board members who are professional in their attitude, their skillsets, and their commitment to a code of conduct, will do better for the company.’ Another benefit of improving the skills of directors would be the strong signal that government is serious about governance and that it respects the role that boards have to play. ‘The board sets the tone for the whole company, oversees its strategy and ensures it is governed properly – a successful company needs a good board,’ Natesan insists. ‘If parastatals are going to be able to become contributors to the fiscus, they need to be properly governed.’ n
Institute of Directors Southern Africa W www.iodsa.co.za
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ADVERTORIAL
Willie Thabe
Njabulo Mthembu
Black Management Forum Investment (bmfi) BMFI is a black-owned investment-holding company with over R450 million in investments. We were established as the investment arm of the Black Management Forum (BMF). We hold a diversified investment portfolio of mostly publicly traded entities in the hotel and leisure, construction, education, agriculture and transportation industries. We are now seeking to diversify into privately-owned companies, where the BMFI will have the opportunity to partner with management teams in driving the strategic growth of the companies they operate. By using the levers at our disposal – the vast network of black professionals and industry leaders who are members of our parent entity – combined with the business and private investment experience of the BMFI team, we are well placed to add substantive value to our future investees. Our investment philosophy is premised on the notion that great companies are built by great people. We therefore seek to invest in sustainable business models alongside proven and progressive management teams with a deep understanding of their industries. n
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BMFI Willie Thabe, Managing Director C +27 083 462 9196 E Wthabe@Bmfi.co.za Njabulo Mthembu, Chief Investment Officer C +27 084 291 7742 E Njabulo@Bmfi.co.za First Floor, 23 Impala Road, Chislehurston, Sandton. T +27 011 430 8560
FEATURE
Assistance with new B-BBEE codes Shanduka Black Umbrellas (SBU) has developed an Enterprise and Supplier Development Handbook – a tailor-made guide to the enterprise and supplier development requirements of the new B-BBEE codes. The handbook explains the new codes and highlights how corporates, SMMEs and entrepreneurs can benefit from the new B-BBEE codes. The amendments in the new B-BBEE codes of good practice have been gazetted into law by the Department of trade and Industry (DTI) and there are five elements on how companies are measured on their B-BBEE compliance. These elements include ownership, management control, skills development, enterprise and supplier development and socio-economic development. The SBU Enterprise and Supplier Development Handbook is a solution to assist organisations to manage the new codes responsibly and effectively. One of the challenges for organisations to meet the required score is caused by difficulties in sourcing quality black owned businesses from which they may procure to meet the required procurement targets. SBU, with over 300 100% black owned businesses in its incubators, and Shanduka Black Pages (SBP), with over 6 000 100% black owned businesses as members listed on the online enterprise and supplier development portal, provide a meaningful source of possible suppliers that can assist companies to meet scorecard targets.
‘Companies were given until April 30, 2015 to ensure that they were ready for the increased requirements of the revised B-BBEE policy. The new ESD scorecard requires renewed thinking from supply chain and procurement professionals. Innovative, strategic thinking is now required and this handbook is the perfect guide to assist organisations to understand the new codes and implement compliance strategies,’ says Seapei Mafoyane, CEO of Shanduka Black Umbrellas. The Enterprise and Supplier Development Handbook seeks to prove that the new B-BBEE codes can have a positive impact across the board, whether you are a corporate seeking to manage them, or a small business seeking to benefit. The Enterprise and Supplier Development Handbook is available for download at http://shandukablackumbrellas.org/uncategorized/ download-2015-enterprise-and-supplier-developmenthandbook/ n Article supplied by The Change Agent Collective – A company that works with clients to discover their good stories and use effective communications that create movements of positive change. For more information, email: deon@thechangeagent.co.za.
Shanduka Black Umbrellas is a non-profit enterprise development incubation organisation that partners with the private sector, government and civil society to address the low levels of entrepreneurship and high failure rate of 100% black owned emerging businesses in South Africa. The programme focuses on promoting entrepreneurship as a desirable economic path, and nurturing 100% black-owned businesses in the critical first three years of their existence through the provision of nationwide incubators. For more information, visit http://shandukablackumbrellas.org. Pic credit: Shanduka Black Umbreallas
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FEATURE
Gearing up for government tenders According to the National Treasury, in 2013/2014 the South African public sector spent R500-billion on goods, services and construction works. To provide these services you need to be familiar with the government’s procurement processes. These are legislated and currently going through a number of changes. If you’ve never responded to a government tender before, there’s a high chance you’ll be intimidated by your first one. But don’t let them knock you down, rather be prepared.
Stay in the running Compliance is a major factor in having your proposal considered. Most government bids will first go through their procurement department for a number of tick-box checks. Was it delivered on time? If the RFP’s deadline is September 2, 2015, at 10:00, it has to be there before this time or it is thrown out. Then the proposals are checked for general compliance. Were the mandatory questions answered? Are all the forms filled in? Are the correct certificates attached, and are they up to date? Did the bidder attend the compulsory briefing session? So, to prepare yourself, make sure you have an up-to-date SARS tax clearance certificate, B-BBEE certification, and current company registration documents for the correct bidding legal entity. If you work in a highlyregulated industry, such as financial services, ensure that all your required documentation is in one place and that you have enough original and certified copies.
Beyond compliance to the evaluators Once your document has passed the compliance test it reaches the evaluators. This is the point at which you want to make a good impression. We’ve asked seasoned
evaluators what they want to see. They immediately want to see that the bidders have made the time and effort to win this work. The document is well-prepared and clearly packaged, with responsive answers to the questions. It must also be clear that the bidder has the capacity to do the work and has priced the work correctly. The evaluators separate the functionality of the offering and the pricing. So, first they assess if you can do the job – eliminating some bidders along the way – and next they look at your pricing and B-BBEE status. If you’ve made this shortlist you could be called in to do a presentation to the key decision makers. Preparing for this stage includes knowing how you are going to approach each bid, asking yourself: Can I do this work? Do I want this work? What will put me at the front of the race? Start preparing documents that show off your capabilities and describe your solutions.
Going digital The government is well on its way to procuring goods and services centrally through an e-portal. This is going to take away filling in numerous forms by hand, submitting the same document, such as a tax clearance certificate, for every new tender and needing to buy a number of newspapers to look for advertised RFPs. A central supplier database is being created where you register your company and load your necessary certificates. To prepare yourself, have a look at it: www.etenders.gov.za.
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FEATURE
Get in the know The main pieces of legislation governing state procurement are the Public Finance Management Act 1 of 1999, and the Public Finance Management Amendment Act (Act No. 29 of 1999) – otherwise known as the PFMA – and the Preferential Procurement Policy Framework Act (PPPFA). However, there is other relevant legislation, such as the Local Government: Municipal Finance Management Act No. 56 of 2003 and the B-BBEE Amendment Act (2013). These are complemented by National Treasury Regulations on specific issues. Reading through all these acts can be tedious, so look for summaries and shorter reports. Look out for case law as these often clarify the law. An example from a few years ago clarified that government entities must first assess proposals for functionality. Then, for all who pass this test, they take the one with the best price and B-BBEE points according to the correct formula. There are also numerous training courses and seminars on these. If you feel you need one, look for a session that will answer your questions. One of the latest developments is open tendering. This
is when the bid process is open to public observation and the outcomes throughout the evaluation are publicised. The Gauteng government has started doing this for bids worth over R50-million. This will mean more of your offer – and key pricing items – will be public knowledge. Both you and your competitors will know more about each other, which can be very useful in the next bid.
Be patient, very patient There’s a huge adrenalin rush after submitting a proposal – especially if you were very close to the deadline. Unfortunately experience has shown that there is a long time to wait for a result. It can be well over a year, which will play havoc with your pricing and predicting your sales pipeline.
Geared up for government Winning government work is not an overnight success, but it’s entirely possible. And rewarding. Take the time to familiarise yourself with what government wants from its suppliers, follow the rules and approach each bid strategically. n
KEY TERMS Request for what? RFP – Request for proposal. Here you need to give your full solution, including pricing. RFI – Request for information. This often excludes pricing and is issued when government is looking to find out more information on the available solutions and providers. RFQ – Request for quote. The focus here is on pricing, but you might want to include a summary of your solution, especially if you are not the incumbent. RFX – Request for X. This can encompass an RFP, RFI or RFQ. Tender – Similar to an RFP. The government is putting out a section of work to tender in that they want a number of suppliers to respond to get the best product or service for the best price. Bid or proposal – This is your response to the government’s request. Incumbent – You already have the business. Unfortunately the only way to keep it is to respond to the latest RFP. Your advantage is that you know what this government department/entity wants and you can show the value that you have created. Your disadvantage is that you may have become complacent and will have to use your knowledge to fight off hungry new competitors.
TOP TIPS • P repare before the RFP lands. Get to know your government clients. This way you may find out when they will issue the RFP and what they really want. • Read the RFP – slowly and carefully. Highlight the compulsory items, the deadline to submit, and ask yourself if you really want to spend the time and effort to respond well. • It will always take you longer than you think! Even though the e-tender site is geared for greater efficiency, allow time to get it right. Downloads may be slow for no reason at all, you could lose connection in the middle of submitting your bid and you just need to get used to the system. This article was submitted by the Association of Proposal Management Professionals South Africa (APMP SA). APMP SA is the worldwide authority for professionals dedicated to the process of winning business through proposals, bids, tenders and presentations. For more information, visit www.apmp.org.
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Opinion
The elephant in the room By Jason Drew
Why will no one talk about the elephant in the room that is population? Previously because it used to taboo – but now perhaps because it is no longer one of the key issues that faces our civilisation. The population boom is about to end one way or another. Let me explain. Ever since Thomas Malthus outlined his theory on the inability of the human race to feed its growing population, people have been concerned about the re-emergence of the famines and starvation that have dominated much of human existence. While it is indeed true that food prices have risen substantially, they will rise again as our ability to produce more food is not matched by the increase in our population. This may lead to societal crises but
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managing food waste and distribution, as well as new agricultural technology, can probably help us feed our peak population. It is also true that our overuse of antibiotics has led to more and more resistant strains of disease. One third of all antibiotics that are produced in the world are used as a preventive measure in mass-produced chicken. This abusive malpractice could easily unleash a Spanish flu type epidemic that in 1918 killed more people than World War I, some estimates range as high as 5% of the global population. However, what few people realise is that what we call modern civilisation is the cure to overpopulation at that time. If every woman in her lifetime has 2.1 children, the world’s population would stay roughly flat. In Europe that birth rate figure has fallen to around 1.4 children
Opinion
However, in 2006 we passed the point at which 50% of all humans lived in cities, up from 4% in the pre-industrial era. It is forecast that by 2050 nearly 80% of all humanity will live in cities and their slums. In the major cities of those high-population growth countries, the birth rates average 1.1 children per woman during her lifetime. This birth rate would imply that the populations of humans on this planet will fall dramatically over the next 80 years just from our lower birth rates, not to mention the impact of birth protection hormones in our water systems and wider availability of reproductive health services. The reason behind this is that in the countryside children tend to add to the economic activity of the family. In cities children are expensive to provide for and tend to detract from a families economic activity. It may well be that cities, in which ever more of us are living, are the only effective form of contraception that mankind has ever invented. As a society we are reluctant to talk about the over population of our planet by humans, whereas we are quite happy to talk about overpopulation of other animals as a pest or a plague! This keeps us from hearing and understanding the good news, and that we should focus on other issues with more energy rather than just population. One of these of course is how we feed the peak population of between nine and 11 billion without causing the collapse of civilisation as strained food systems have caused the collapse of civilisation before us. n Article supplied by The Change Agent Collective – A company that works with clients to discover their good stories and use effective communications that create movements of positive change. For more information, email: deon@thechangeagent.co.za.
on average. That means that if nothing else happened, and there were no migration, Europe’s population would divide by three by the year 2100. Those countries where already large populations are rapidly growing, such as Pakistan and Nigeria, have birth rates as high as 2.6 children per woman. This implies that the populations of these countries will more than double over the next 30 to 40 years. Such is the effect of small variances around the magic birth rate number 2.1. If you delve deep into the numbers behind the childbirth rates in those countries you see a remarkable and different emerging picture. In the countryside the birth rate in many regions is over 4.5 children per woman, suggesting a huge boom in population in those countries.
Jason Drew
Globally boardrooms are being held to account for their sustainability, ethics and social contribution. On this growing and current corporate trend, Jason Drew is one of the most engaging speakers of his generation. His insights into business, the environment and its future are remarkable. A self-confessed ‘environmental capitalist’, Jason argues sustainability has to have an economic impact and moreover, an economic reward, if it is to strike a chord with a global audience and indeed, himself. He believes that while capitalism may have caused many of the issues we face, it may be the only tool we have that is strong enough to fix the problems. Jason is the published author of books, a successful public speaker and a ‘planet motivator’ for the future. For more information, visit www.jasonjdrew.com.
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OPINION
History speaks: Your memory be damned By Dr Roger Stewart
South Africa, Egypt and Syria have experienced the removal of images and other symbols that represent unwanted or intolerable ideas or memories. Is this the way to go? In his Life of Reason, George Santayana warned that those who do not remember the past will repeat it. Memory is necessary, but it is not sufficient for preventing us from repeating the past. That requires learning, signalled by a change of thinking and behaviour. Sadly, attempts to expunge memory have not fostered learning: the unacceptable deeds that led to the sanction continued to be repeated. Nevertheless, the ancient sanction continues today – will it lead to different outcomes? The general challenge is this: what to do with symbols from an unpleasant, even horrible past? The framing of this open question as a dichotomy, a false dilemma, constrains the answer – we remove the symbol or we leave it. This framing of the problem was followed by the University of Cape Town: move or leave in place the statue of Cecil John Rhodes. Apparently, there was a sole dissenting vote when the members of UCT’s senate
Pic credit: Gareth Griffiths
Because dishonouring is a form of commemoration, the ancient Roman senate imposed the sanction of Damnatio memoriae: all reminders of the offender were to be expunged. The sanction involved a cathartic defacing, destroying or removing from view of images, buildings, possessions and anything else that had the potential to remind society of the condemned person. Effectively, the offender became an ‘unperson’. The sanction of erasing unwanted memory has taken other forms – renaming spaces and places, destroying or hiding items in museums or places of worship, censorship and ‘total elimination of any trace of mental colonisation’. We cannot know about successful campaigns to have people forgotten. However, history is littered with its failures, such as Stalin’s failed damnatio memoriae of Trotsky, despite the murder of members of Trotsky’s family.
The Mandela Rhodes Scholarships are changing the lives of young Africans, who will play vital roles in the future of the continent.
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OPINION
Pic credit: Gareth Griffiths
and unifying meaning and direction to the contentious Rhodes legacy; and it augmented Mandela’s legacy. It is a meaning that resonates with a country in search of transformation. Recalling, reflecting on, and understanding history in context are essential to making sense of complex legacies. Making sense of and learning from history may require new thinking and result in new meaning. The creative step in learning is setting a new direction towards a better long-term future; the next step is focusing energy on reaching the destination. We cannot be sure new ways will succeed, but that does not justify framing of complex human conundrums as a false dichotomy. In the heat of the furore at UCT, Mandela’s creative approach to the Rhodes conundrum seems to have been forgotten, ignored or discarded. Was the falling of the Rhodes statue symbolic of another, more ominous falling from grace? n Sources: http://philpapers.org/rec/ DASCAD; https://en.wikipedia. org/wiki/List_of_Newspeak_words; www.bbc.co.uk/news/worldafrica-32236922
Dr Roger Stewart
Dr. Stewart works with senior managers on thinking creatively about and finding novel solutions to their challenges. For more information, visit www.BusinessSculptors.com.
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Pic credit: Gareth Griffiths
and council UCT decided to remove the statue to an undisclosed location. It is a great pity that UCT’s scholars and councillors were not innovative in solving their conundrum: the Rhodes statue has been banished, to be displayed or hidden in a ‘museum of unwanted memories’. Nelson Mandela became involved in the future of the Rhodes Scholarships. Unexpectedly, he formed a partnership with the Rhodes Trust, co-creating the Mandela-Rhodes Foundation and Scholarship. ‘The bringing together of these two names represents a symbolic moment in the closing of the historic circle; drawing together the legacies of reconciliation and leadership and those of entrepreneurship and education. Already the Mandela Rhodes Scholarships are changing the lives of young Africans, who will play vital roles in the future of the continent. The achievements of The MandelaRhodes Foundation so far have been remarkable, but it is its future potential that is most exciting.’ Mandela’s inspired move ‘closed a circle of history’, but opened the portal to new opportunities and a better future for the country. Scholarships, arguably the most prestigious in the country, are awarded to outstanding students who are African citizens and who also possess leadership ability, entrepreneurial skills, and a commitment to reconciliation; and the majority of awards are to Africans of indigenous origin. Mandela and the Rhodes Trust of the time refused to be impaled on the horns of a false dilemma. They explored the space that is excluded in dichotomous thinking. Their exploration delivered the paradoxical juxtaposition of Mandela and Rhodes, which made way for a new
OPINION
Entropy explained – South Africa’s dilemma on visa regulations By Gaby Gramm, Managing Director and Owner, LuxTravelEx
South Africa’s advancement as a global tourist destination of choice faced further disruption at the beginning of June as the requirement for children to be in possession of unabridged birth certificates before being allowed into the country was implemented. While the rationale for children to be in possession of unabridged birth certificates before being allowed into South Africa, this measure – unique in the world – may be justified as a means of controlling human trafficking but doesn’t make sense in the context of economic growth where tourism is a key contributor. These recent developments are a perfect example of the law of entropy, illustrating the effect that questionable policy writing and lack of big picture understanding has on the energy coming from a thriving business sector. The measure of the level of disorder that is created through deterioration and blockages in a changing system, a system in which energy can only be transferred in one direction from an ordered state to a disordered state, is what we understand as entropy. The higher the entropy, the higher the disorder and lower the availability of the system’s energy to do useful work. The term entropy is a measure of the degree to which energy
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has lost the capacity to perform useful work, leading to inefficiency. A visa regulation that scares potential visitors away from our country is entropy – it is designed to get our industry into a state of disorder. Businesses are either organic or bureaucratic in nature. In the context of tourism in South Africa, there fortunately are organic organisations, such as SATSA headed up by the dynamic David Frost, that are open because they invite innovation and creativity while seeking continuous exchange with the environment, and aim to show sustainable growth. Bureaucratic organisations are on the opposite end of the spectrum – in this case, our Ministries of Tourism and Home Affairs. They operate in a mechanistic and closed style that is subjected to entropy. Although they proclaim they do, they barely consider their environment and usually ignore the flags and warning signs they are presented with.
OPINION
Potential energy no longer available for all stakeholders
announced it would consult with industry players and form a task group – this never happened.
There are two possibilities why potential energy is not available for work, thereby generating disorder and entropy. We don’t move beyond our comfort zones and keep everything status quo. At this point the law of entropy takes over and then the problems begin because without new input energy and change our businesses will go downhill. That’s it. It will happen. The power comes in understanding the law of entropy, being vigilant and always ready to evaluate and initiate appropriate change. At times, this does not have to be much – a tweak here and a new idea implemented there. In our case, a potential problem of child trafficking, which is minimal in South Africa, could have been addressed without introducing drastic measures that require complicated documentation from international tourists arriving at our airports – and no measures at poorly secured land borders somewhere in South Africa! Entropy is also a challenge in a successfully growing company. When a venture such as our country’s tourism becomes obviously successful, it attracts the international travel trade who want to be involved with us. They expect the success to simply continue and are not seeing themselves as responsible for contributing to the future success of the venture. So if the international travel trade and traveller is aware of problems pertaining to South Africa’s hostile policies and its effect on our economy, they will simply stay away. To avoid this kind of entropy we must be mindful of the way in which we deploy new resources and ideas, new regulations and requirements thrown at our visitors. Its energy can otherwise be diffused, averaged down and unfocused. When this happens, a company’s culture – our tourism offering – begins to shift.
Breaking organisational routines
How to take control over entropy?
Sources: Jose Alcedo www.youkaizen.com; Don Peppers, FastCompany; www.crcoaching.com
Information gathering is how we learn new things and gain new perspectives. In a very interesting book, Most Human Human by Brian Christian, it is suggested that in each case we will gain the most insight when asking the question to the person of whose answer we are least certain. We should be seeking out high-entropy information to learn new things at a faster, more efficient rate. Don’t tell us something we already know. Rather tell us something we don’t know and seek advice from the people that will give you the best insight. It is of course always more pleasant to talk to people whose views we agree with and share. At the outset of the implementation of this visa regulation, the Department of Home Affairs
The other way to beat entropy is to develop positive energy from teams of people that create a force greater than the degrading force of entropy. The work of a task team spearheaded by the ministry of Home Affairs and Tourism to work through the issues and challenges together with tourism representatives, could have beaten entropy. Entropy cannot establish itself when adapting implementation measures and changes keep coming. The disruption and disorder this creates makes continuous improvement efforts more important. The numerous inconsistent messages from government authorities about how the implementation of the unabridged birth certificates should have be handled have been clumsy and have not provided anyone the reassurance that the department is in control. The general cause and effect of this issue and the highly-disruptive changes to a well-functioning tourism business sector are increasing the level of entropy and leading to further inefficiency within the main stakeholders operations – the Department of Home Affairs, Department of Tourism, and various Tourism associations involved – because the system does not have the energy to do any useful work. The tourism industry, which has been growing steadily – more than any other business sector in the country – will now have to deploy new resources to counter the effects of the new visa regulation, affecting its capacity and generating significant disorder as a result. Appropriate changes and adjustments on both sides should be initiated to create a ‘useful order’ and balance rather than an unusable mess. n
Gaby Gramm, Managing Director LuxTravelEx
Gaby Gramm is the Managing Director and Owner of LuxTravelEx, which offers marketing and operational solutions tailored to the luxury hospitality industry with a special focus on applying the Lean Thinking methodology in her field of expertise. With over 24 years’ hands-on hospitality experience within the luxury hotel sector, solid relationships with an extensive local and international network of industry players, and an Executive MBA from the Graduate School of Business Cape Town, Gaby has worked on a number of exciting consulting projects and writes for various industry publications. For further information, visit www.luxtravelex.com.
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HUMAN RESOURCES
Managing millennials By Terri Klass and Judy Lindenberger
Integrating the Millennials or Gen Y twenty-somethings into a Baby Boomer culture is a big challenge for business. Who are the Millennials, and how do we manage their expectations while maintaining high-performing organisations? One of the biggest challenges for businesses is integrating the Millennials or Gen Y twentysomethings into a Baby Boomer culture. They are the newest generation to enter the labour market, arriving with their distinct ideas about what they expect from their jobs. They are our future leaders and our next generation of revenue-generators. The 75-million strong Millennial Generation was born between 1977 and 1998 and raised by ‘helicopter parents’ who doted on them, giving them an ample attention and validation. Because they were heralded with high expectations, Millennials tend to display an abundance of self-confidence and believe, from day one, that they are highly valuable to any organisation. They are focused on developing themselves and thrive on learning new job skills, always setting new challenges to achieve. They are also the ‘can do’ generation, never worrying about failure as they see themselves as running the world and work environments. Unlike other generations, the Millennials are overly connected to their parents. They speak to their parents frequently and turn to them for personal and career advice. Some still live at home, not uncomfortable with the arrangement. Organisations must remember the parent involvement factor when dealing with this group. These parents are still micro-managing their children’s careers and personal lives. When it comes to a work-life balance, Gen Y is not willing to give up their lifestyle for a career. They choose careers that allow them to live the life they desire, busy with after-work activities. Multitasking is their way of life. When their workday ends, Millennials charge out into gyms, volunteer positions, classes and social events. Millennials are team-oriented, banding together to socialise in groups. In school, this generation was taught lessons using a cooperative learning style – they feel comfortable working in teams and want to make friends
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with the people at work. They believe that a team can accomplish more and create a better end result. They also grew up in a multi-cultural world that enables them to work well in a team with diverse co-workers. They communicate in snippets through instant messaging, texting, Facebook and email. Quick and efficient communication is the way Millennials choose to interact, not necessarily face-to-face. They are typically unaware of their non-verbal cues. As a result, this generation tends to have more miscommunication between friends, co-workers and bosses. They forget that words only account for a small part of the communication, and spending time on the phone is not their number one choice. Of all of the talents that Millennials bring to the workplace, being technologically savvy is their greatest skill contribution. They are constantly connected, all while working on a critical project. Social media is at the heart of their world, allowing them to connect with co-workers and friends around the world at great speed. Another Millennials characteristic is their need for constant feedback and praise. They were reassured daily about their achievements. It is a generation that needs to continue feeling valuable, while adding their opinions and ideas to every company decision. In giving critical feedback, managers will need to first compliment Millennials before they will listen to any criticism. They also have little patience for ambiguity, so directions during feedback sessions must be clear and specific. Organisations will be more successful delivering performance milestones on a more frequent basis, rather than once a year. The feedback sessions must be interactive, so that the Millennial is presented with the opportunity to share their feelings and ideas. So how do you integrate and manage the youngest generation within the workplace? Here are some key tips and insights:
HUMAN RESOURCES
Category
What To Do
Why
Work environment
Provide flexible work schedules and a relaxed workplace.
Millennials put friends and lifestyle above work.
Create opportunities for social interaction, such as Friday afternoon alcohol-free ‘happy hours’, and competitive team activities.
They are getting married, having children, and generally facing the ‘real world’ later.
Learning and training opportunities
Provide tuition reimbursement and employee training.
Baby Boomer parents raised them to believe that education is the road to success.
Recruiting
Emphasise the ways in which your company contributes to society.
Almost 70% say that giving back and being civically engaged are their highest priorities.
On boarding
Give them exposure to different parts of the business, provide resources on the intranet for them to use at their own pace, and help them build relationships with current employees.
Millennials want connections, checkpoints and mentoring.
Work ethic
Millennials ask ‘what is my job’, and go about figuring out the best, fastest way to complete that task. Then they consider themselves done.
Millennials have not been raised to look around and see what should be done next.
Motivation
Provide paid time off as a reward.
They view jobs as ‘something to do between the weekends’.
Boss relationships
Win their affection. Be careful not to cross the line from boss as advocate to boss as friend.
Loyalty to the boss is the number one reason they stay in a job, especially during the first three years. Dissatisfaction with the boss is the number one reason they quit. Millennials want a tight bond with a boss who is close, caring and aware.
Managing
Describe the result you’re looking for and let them figure out how to get there. In many cases they’ll develop a better process. To bring out the best in them, teach them about the company and explain how their work will lead to specific results. Hold them accountable for mistakes and praise them for success. If you tell them it’s your way or the highway, they may walk.
Millennials grew up learning how to figure out things on their own. They do not take well to orders and resent being handed busywork with no explanation as to its purpose. They are impatient but always eager to learn and quick to do so. Millennials think of themselves as merchandise that they can sell to the highest bidder. And, more than half of graduates move home after graduation; it’s a safety net that allows young adults to opt out of jobs they don’t like.
Work assignments
Give them several projects. Put them in the field with clients where they can work in teams and solve problems collaboratively. Let them work on projects with higher-ups when appropriate.
They are great multi-taskers with 10 times the speed and technical knowledge of their older siblings. Though they are independent thinkers, Millennials love working in teams. They question the status quo and expect to make an impact on day one.
Performance feedback
Provide coaching sessions to discuss career paths. Shorten the feedback loop. Do reviews on a quarterly basis, at the least.
Millennial employees feel entitled to a raise and promotion in a week and the corner office in six. Boomer parents coached them to ask for what they want, and they’re used to constant feedback.
Reducing turnover
Create career paths with a timeframe short enough for them to envision. Reward small successes along the way.
They set short-term goals and are resistant to paying their dues.
This article was supplied by authors, Judy Lindenberger and Terri Klass, who are experts in leadership development, human resources and coaching in the US. For more information, visit www.lindenbergergroup.com.
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Ofentse HR specialists is 100% black owned company, which was established with the sole objective of providing quality human resources services in different organisation’s Our prime focus is on the needs of our clients and we believe in delivering the best as per their requirments We are an erudite HR consultants based in south Africa Our expertise in HR issues has helped us to speed up the growth pace of our venerable clients. Brilliancy in human resource consulting services and reasonable charges has placed us as most trusted HR management consultant
Recruitment and Placement Training and Development Performance Management Systems Organisational Development Skills Auditing, HRAudit and HR Risk Assessment Mentoring and Couching Developing Policies and Procedures Industrial Relations Occupational Health and Safety
Tshepo Lephoi Managing Director
Ofentse HR Specialists
Unit 39 Malaga. Dennis Road, Athol, Sandton fax: 0865560523 tel: 0791228278 email: tshepo@ofentsehr.co.za website: www.ofentsehr.co.za
HUMAN RESOURCES
Incentive plans that work By Dr Mark Bussin, Chairman, 21st Century Pay Solutions Group
Employee incentive plans go by many different names – you’ve undoubtedly seen your share. But, with many economies struggling, how should you approach your employee incentive plans differently to reach your organisations goals? Can an employee incentive plan actually create the results you need? First let’s look at the bigger remuneration picture and where exactly incentives fit in. At the start we have the base salary component – the guaranteed income for the complexity of work performed. Next is the benefit package that takes care of the health, wealth and needs of the employees. Perquisites aid in our ability to perform best at the job and effectively. Shortterm incentives (bonuses, incentives and commission) rewards what happened last year, and long-term incentives are used for retention and shareholder alignment. For the purposes of this article, we focus mainly on bonuses and incentives. There is growing distinction between the definitions of bonuses versus incentives. Bonuses can be defined as reward after something good happens but was not promised in advance in most situations. An incentive is a payment that is promised in advance in a performance period and in return to a specific objectively performance measure.
Components of Total Remuneration Bonuses grab the attention of employees but do not motivate them for a long-term period. In our view, bonuses have a place in the remuneration mix, but the company should not spend a great deal of money on bonuses because they do not motivate as incentives do – they are safe, but not influential. Individual incentive plans are designed to reward employees for their improved commitment and performance at an individual level. Typically, goals reflect participant’s specific responsibilities, and payouts are based on an evaluation of the individual’s performance relative to present goals. Because participants often perceive the goals as controllable, individual incentive plans provide a clear link between pay and performance and will have a high impact on employee behaviour. Based on the article Test Your Incentive Plans Against These Guidelines, Timothy O’Rourke and Matthews Young
describe some very interesting guidelines that are worth repeating. Guideline 1 The potential incentive must be big enough to get the employees’ attention. We know that well designed incentives make most employees focus. Good employees already work hard, but hard working employees who are not focused often work against the results the company seeks. Incentives create focus. However, you have to get employees’ attention first. Guideline 2 The performance or results required to earn the incentive must be within the employees’ control or significant influence. This guideline has led to the failure or success of more incentive plans than any other guideline. One must be able to see or understand the cause and effect relationship between one’s effort – the results of that effort and the reward. The need to provide the proper ‘line of sight’ between output and rewards at all levels of the company may require a large number of different incentive plans to cover all employees under incentives. The administrative requirements then become burdensome and we have seen diminishing returns from an effort to cover an ever-increasing number of levels in the company. On the other hand, we have seen successful applications of different mixes of remuneration components for different levels of the company. Guideline 3 The performance or results required to earn the incentive must be perceived as achievable with ‘stretch.’ If I told you that I would give you one million rand at the end of the next year, I would probably get your attention. And, your next question would be ‘what do I have to do to get it?’ Then, if I told you that you would need to get yourself to Mars and back, I would lose your attention. No matter how good the promised reward, the employee must believe
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HUMAN RESOURCES
that the desired performance is achievable. Of course, Guideline 2 has a great deal to do with the employee’s perception of the ability to achieve the desired outcome. We have also found that the objective must be perceived to require a stretch. If I told you that you could earn that million-rand incentive if the paint on the walls of an empty storage room remained the same colour all year, you would probably focus on the objective for a while. However, after some time, you might begin to doubt that I would really pay you for such a meaningless objective. Then, you would get bored with the effort and realise that, if I was not lying to you, the objective was too easy to achieve and you would stop watching the walls. The incentivised performance needs to be perceived as a desirable, stretch goal to get and keep the employee’s attention. Guideline 4 The payout must be worth the effort required to ‘stretch’. This guideline suggests that the plan should pay something for partial achievement of the desired outcome. Not only must the potential incentive be big enough to get employees’ attention, but it must also be perceived to be worth the effort. If the effort or focus required to get the full incentive opportunity requires stretch, in other words it’s seriously at risk, then the actual payout after the final measurement is made needs to justify the attempt that was made to achieve the full objective. Many plans fail because they have a ‘cliff’ where any level of achievement below the objective pays nothing. ‘Cliffs’ encourage employees to do anything to achieve the last few units of measurement. If they are close to achieving the stretch objectives, they might do something you do not want to happen to get over the cliff. One CEO with a cliff plan lamented that he was afraid the employees would sell the furniture at year-end to achieve a tough revenue objective. Guideline 5 The payout should never be a surprise. This assumption often differentiates an incentive from a bonus as defined at the beginning of this article. If the payout cannot be forecast as the performance period proceeds, the plan will fail to keep the employees focus on the desired outcome. Furthermore, the first time that the desired outcome is achieved, and the employer fails to pay the incentive, the motivational power of the plan is lost forever. Guideline 6 The sources of performance tracking must be readily and frequently available. For the plan to avoid surprises, it must pay for the achievement of objective measures of the desired outcomes. Too much subjectivity in the
measurements will turn a plan into a surprise bonus. Furthermore, the participants in the plan need to know where they stand at all times. Therefore, the sources of the measurements should be available to every participant on a regular basis. Guideline 7 Calculations for determining payouts must be simple and clearly understood. The KISS guideline applies to incentive plans as much as in any endeavour, if not more so. The key question to ask is, ‘do my employees know where they stand at any point in time during the performance period?’ To keep the employees focused, they need to know where, precisely, they stand and how much they are leaving on the table. This guideline argues against formulas that create curvilinear payouts and plans that use more than a few measures of success. Guideline 8 Finally, you will get what you pay for, so be sure it is what you really want. Incentive plans are powerful forms of remuneration. Well-designed plans focus employees much more than any other component of reward systems. Many a management team has driven their company in the wrong direction because they rewarded the wrong outcomes. Before you even consider incentives, make sure you know the company’s strategy and the critical measurements of success. These guidelines are basic enough to be applied to all types of incentives – short-term, long- term, cash and non-cash, current and deferred, management and staff. Applying them will aid in motivating employees and achieving desired results and most of all creating a fair, unbiased, and trust-focused culture. Please remember that incentive schemes are not a substitute for good management. Common sense needs to be applied and employees need to be led. There is no substitute for great leadership. n
Dr Mark Bussin, Chairman, 21st Century Pay Solutions Group
Dr Mark Bussin, Chairman of 21st Century, has remuneration experience across all industry sectors and is viewed as a thought leader in this arena. He serves on and advises numerous boards, audit and remuneration committees, and has consulted in many countries for multinational companies. 21st Century is a one of the largest full-spectrum specialist remuneration and reward consultancies in Africa, with a national and international capability serving Government, Parastatals and two thirds of the companies on the JSE. For more information, visit www.21century.co.za.
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I LOVE YOU
WHEN?
WORK
Upskilling young Deaf learners With Government calling for stricter BEE compliance, eDeaf, with its BBB-EE Level 1 status, is perfectly positioned to facilitate this shortfall. Passionately Deaf led, owned and managed, eDeaf is at the forefront when it comes to employing and empowering young deaf people for work. eDeaf upskills and trains young deaf learners through its accredited training centres in Johannesburg, Pretoria, Durban and Cape Town. Benefits for Deaf learners: • Fully qualified Deaf facilitators to teach a variety of subjects • Monthly stipends paid by sponsorship company • A Deaf-friendly learning environment • Learnerships and access to on-going training • Access to an interpreter Benefits for clients: • Deaf sensitisation training • Placement of deaf staff • Sign language training • BBBEE points • Tax rebates, subsidies, etc • Access to an interpreter
A Deaf person can add value to your business in the following ways: • Deaf staff are not easily distracted • Exceptional attention to visual detail • Have the ability to work in noisy environments • Thrive in practical, hands-on environments eDeaf has placed over 2 500 candidates in 200 organisations nationally, with an 80% retention rate. ‘Deaf employees not only add value to the market, but excel and surpass the expectations of their employer,’ says Nazereen Bhana, Managing Member. n
www.edeaf.co.za eDEAF Head Office, Johannesburg T +27 011 837 7432 Durban T +27 031 202 5939 W www.edeaf.co.za
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Human Resources
Enhancing employee engagement Engagement, the employee’s commitment to his or her organisation and the willingness to perform beyond expectations, has become a focus area for management. While many factors affect engagement, a study reveals the importance of the personal relationships between managers and their staff. Engagement is more than mere job satisfaction. Fully engaged employees are motivated and dedicated to making the organisation a success. At the most simplistic level, engaged employees lead to happy, loyal customers and repeat business. Engagement also leads to improvement in retention levels. In short, it impacts the bottom line. Dale Carnegie Training asked MSW Research to undertake a benchmark nationwide cross industry study of 1 500 employees to explore engagement in the workplace. The study discovered that although there are multiple factors affecting engagement, the personal relationships between a manager and his staff is the most influential.
The value of the immediate supervisor The immediate supervisor performs a pivotal role. He connects an employee to senior management and vice versa, becoming the primary conduit for the flow of information within an organisation. Top down, management imparts its goals and values through the supervisor who can best explain to individuals what these mean and how they may affect employees. Bottom up, the immediate supervisor ensures that employees’ voices are heard, listens to their concerns and responds to them, and passes that feedback to senior management. It is said that employees don’t leave companies, they leave people. What managers do, how they behave, what they say and, importantly, how they say it, affects employees’ attitudes about their jobs and the organisation. Employees who are unhappy and dissatisfied with their immediate supervisors are
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less likely to identify with the organisation’s vision and more likely to be absent or to resign. Employees who are engaged take pride in their work, support organisational goals, and are less willing to change jobs for a minor increase in salary. Employees were asked to rate satisfaction with their immediate supervisor. Forty-nine percent of those employees who were very satisfied with their direct manager were engaged, and an astonishing 80% of those who were very dissatisfied with their immediate supervisor were disengaged.
The emotional effect While the role of emotions in the workplace has been explored in detail in another Dale Carnegie Training white paper, Emotional Drivers Of Employee Engagement, it is important to note that fully engaged employees express feelings of enthusiasm, empowerment, confidence and value based on their interactions with their direct managers. While a good supervisor makes all employees feel valued and confident, a poor supervisor irritates them and makes them feel uncomfortable. The importance of this cannot be overstated. The relationship to the immediate supervisor impacts the investment an organisation makes in its people. When supervisors communicate positive emotions, the employee feels good about the organisation as a whole. Likewise, negative reactions cause a decrease in productivity and morale, leading to disengagement. Moving disengaged employees to full engagement leads to an improvement in employee retention rates, fewer sick days and less absenteeism.
Human Resources
Practical engagement Too often supervisors get caught up in the day-to-day business of managing. It’s easy to imagine if there is no immediate crisis that everything is running smoothly. But to achieve full engagement from workers, the line manager needs to be proactive, exhibiting strong leadership, and foster a positive working environment. Thirty-eight percent of employees who express confidence in the leadership ability of the supervisor are satisfied with him. Over half of these employees are engaged. Good supervisors know employees need to develop the right skills to work efficiently. For example, new employees need more guidance than those who have been with the organisation for a few years. While they are optimistic and excited to advance within the company, they are unsure of their roles and responsibilities. To succeed, they need feedback to understand what they are doing right and encouragement to help them improve. Immediate supervisors can turn that initial level of enthusiasm into full engagement by setting clear goals and training staff. There is also a need for the supervisors to maintain training as the level of engagement plateaus after three to five years of employment. Fifty-three percent of fully engaged employees say they learned a lot from their supervisor compared to 19% of people who are not fully engaged. Successful managers lead by example, which generates enthusiasm and inspires employees to work harder. A remarkable 62% of engaged employees say their manager sets a good example, compared to only 25% among those not fully engaged. Supervisors who delegate and trust employees to carry out tasks empower their staff to make decisions; 40% of those who feel empowered are engaged. Open and honest communication between employee and supervisor allows for greater understanding of both expectations and job performance. Employees who trust and feel respected by their supervisor will be confident that they can speak freely without fear of repercussions. Conversely, a supervisor who fails to communicate openly may lose the confidence of his direct reports and cause them to doubt their own ability or the ideals of the organisation. Supervisors who communicate and trust and respect their staff generate the highest levels of engagement. These consistent, positive interactions with employees promote a spirit of teamwork and cooperation. However, effective immediate supervisors realise a one-size-fits-all approach does not lead to full engagement. For example, disengagement is higher among post graduates than college graduates or those with a high school diploma.
Immediate supervisors can ensure these employees feel valued by recognising their talents. Similarly, low-income and low-level employees are among the most disengaged. The role of the immediate supervisor is vital in ensuring these employees, who are often in clerical or sales positions with direct customer interaction, feel their job is valuable and understand the contribution they make. Employees perceive their value as an individual through the prism of the immediate supervisor. Recognition of their contribution, along with feedback and encouragement on their performance from their manager, leads to increased confidence, commitment and achievement. Failure to recognise and reward good work can negatively impact employee morale and productivity. Many respondents say that their supervisor respects them, but fewer mentioned that their supervisor provides feedback or encouragement to improve. This last aspect is what most generates engagement.
The caring manager It pays dividends for line managers to get to know their staff as this translates into higher levels of engagement and all the consequent positive effects on the organisation. An employee wants to feel that the immediate supervisor is interested in her as a person and cares about her life outside work and its effects on job performance. Research revealed that employees aged 40 to 49 often become less engaged as they face external family pressures. Supervisors who get to know their employees on a personal level and care about their private lives can counteract this middle-age disengagement. These caring activities are two of the four most important drivers of engagement. Training the immediate supervisor to care about employees has a major impact on business performance, reducing staff turnover and heightening productivity. This leads to more satisfied customers and increased sales. Employees have a positive relationship with supervisors who care. Just one-third of respondents believe their manager cares about their personal lives, but 54% of these are engaged. Among the two-thirds who do not believe this, only 17% are engaged. There is a dramatic opportunity to boost engagement by managers demonstrating a caring attitude to staff. Dale Carnegie Training has programmes proven to help management develop the necessary interpersonal skills for supervisors to become strong leaders and caring managers. Building a cadre of effective supervisors will ensure an engaged workforce leading to increased productivity, quality of service and higher profitability. n
Dale Carnegie Training has evolved from one man’s belief in the power of self-improvement to a performance-based training company with offices worldwide. Dale Carnegie focuses on giving business people the opportunity to sharpen their skills and improve their performance to build positive, steady, and profitable results. The 160 Carnegie Managing Directors around the world use their training and consulting services with companies of all sizes in all business segments to increase knowledge and performance. The result is an expanding reservoir of business acumen that clients rely on to drive business results. Dale Carnegie Training is recognised internationally as the leader in bringing out the best in people. For more information, visit www.dalecarnegie.co.za.
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FINANCE & BANKING
SA’s first secure classifieds payment and delivery solution Since July, peer-to-peer buyers and sellers are benefiting from trustworthy, safe and secure financial transactions, thanks to the launch of Shepherd.
Reynolds outlines how the solution works: 1. The customer registers to use the service on www. paywithshepherd.com 2. Either the buyer or seller can request to deal through Shepherd for the transaction. 3. After the seller initiates the transaction, the buyer makes a payment into a secure Standard Bank trust account held by Shepherd.
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Pic credit: Shepherd
Shepherd is South Africa’s first true escrow service that holds payment for online purchases in trust, delivers the goods from the seller to the prospective buyer, and only when the buyer has inspected and accepted the item, releases the money to the seller. According to Shepherd’s MD, Martin Reynolds, escrow simply means holding funds in trust for buyers and sellers by a third party. ‘What makes Shepherd distinctive is that it has partnered with RAM couriers to also ensure that the buyer is satisfied with the item. This eliminates personal contact and makes the whole process much safer,’ Reynolds explains. Shepherd is powered by Standard Bank to provide a seamless and secure online purchasing experience. Craig Polkinghorne, Head of Business & Commercial Banking at Standard Bank, says that while e-commerce continues to grow in South Africa, the biggest concern for online shoppers remains the availability of secure payment platforms. ‘We found it fitting to support Shepherd’s escrow service as it aligns with our commitment to constantly deliver safe and convenient banking platforms and solutions to customers. Shepherd simply eliminates the payment risks associated with online shopping, enabling the buyer and seller to focus on completing the transaction.’ Johan Nel, Country Manager of Gumtree South Africa, says that they are proud to be affiliated with Shepherd and will be fully endorsing the platform on their site. ‘The service is perfect for our business model and customers who want to add an extra layer of security and/or convenience to the classifieds’ experience. We jumped on board immediately.’ ‘In South Africa, customers want a financial product for their online classified purchases that provides a simple payment security solution, and an escrow service combined with courier delivery, reduces the risk of fraud and ensures peace of mind throughout the process,’ Reynolds maintains.
4. S hepherd holds the funds in trust until the buyer receives the item and accepts it. 5. Shepherd facilitates the delivery through its partnership with Ram Couriers. After inspecting the item, the buyer simply signs the courier waybill to accept the delivery and the funds are released to the seller. 6. If the buyer does not accept the delivery, the item is simply returned to the seller and the buyer’s payment is refunded. While Shepherd is already available to online shoppers, the scope of service will initially be limited due to item size restrictions. A small transaction fee is charged for the service. For more information, visit www.paywithshepherd. com. n
Shepherd’s MD, Martin Reynolds
ADVERTORIAL
A one-stop shop Initially established to provide taxation services, The Tax Shop’s integrated services ensure clients can now obtain help for all their financial and business needs under one roof. The Tax Shop, a specialist in accounting, payroll and taxation, has been labelled by many in the franchise industry as one of the fastest growing franchises in South Africa. From humble beginnings, the first outlet was sold in January 2007. Today there are nearly 80 franchises represented in all nine provinces of South Africa, and the numbers continue to grow. Initially the business was fashioned to provide taxation services primarily to individuals. The success of the business model quickly led to the introduction of additional services and, today, Tax Shops around the country offer services in the fields of accounting, payroll, taxation, black economic empowerment, business registrations and related business consulting services. While these services were originally marketed to individuals and small businesses, demand for assistance has increasingly been experienced from the larger SME and very large corporate market. Consequently, The Tax Shop clients now range from sole proprietorships to large international companies. The franchise’s head office is situated in Pretoria, which has proved to be an excellent location for identifying and keeping abreast with the needs of the business community. The seamless integration of services means that clients can obtain help for all their financial and business needs under one roof. The franchise has invested heavily in advanced information technology platforms to enable seamless interaction with clients, and to receive regular and prompt feedback about their service requests thanks to the introduction of innovative and cutting edge web-based software developed specifically for The Tax Shop. The directors of the company are quick to point out that service excellence has been the driving force behind the success of the franchise. In addition, the following factors
have all contributed to excellence within The Tax Shop franchise: • Commitment – the Tax Shop believes that it is important that all parties in the franchise relationship are fully committed to its success. • Backup and support – a critical service offered to all our franchisees without any compromise. • Ongoing training – regularly offered by the franchise ensures that franchisees remain ahead of their competition, both technically and in terms of service delivery. • Financial standing – The Tax Shop regularly reviews its financial position and makes arrangements (if necessary) to ensure that it has the financial ability to weather difficult times. • Continuity – the franchise is structured to continue operations well into the foreseeable future. • Technical knowledge – staff employed by the franchisor are highly qualified in the financial services industry, with many having been certified as Chartered Accountants. • Franchise culture – The Tax Shop’s culture aims to ensure that all franchisees are comfortable within the framework of the franchise and its culture. The Tax Shop looks forward to the future with the knowledge that it has significantly influenced the business and financial services industry in South Africa. n
The Tax Shop T 0861 303 404 (National) T +27 012 997 0110 (Pretoria) E enquiries@taxshop.co.za W www.taxshop.co.za
Accounting. Payroll. Tax.
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SMEs & ENTREPRENEURS
Cash is king By Lesedi Seforo, Tax Technical Advisor, SAIT
Entrepreneurship is a sexy word and the idea of being in charge of your own income and destiny is alluring to many. However, it’s quite a sobering experience when dealing with overzealous creditors eager to hand you over to attorneys at the slightest payment delay. On the other end of the spectrum are debtors who either won’t or can’t pay, or those that take too long to pay. These cash-flow issues raise an interesting VAT question: What happens when you have to write off a debt after coming to the realisation that a customer will never pay you? Before we answer this question, let’s begin with a basic framework of how VAT works. When a VAT-registered company supplies good or services, VAT must be included in the price. This is known in tax circles as output VAT. Likewise, purchases of goods or services will also typically include VAT, known as input VAT. When submitting a VAT return to SARS, the total input VAT is subtracted from total output VAT during the particular tax period (usually a two-month period) and the net amount is paid to SARS. There is also the principle of the invoice basis. Under this method of accounting for VAT, taxpayers must account for the full amount of output VAT included in the price of the goods or services supplied in the tax period in which the time of supply has occurred. The time of supply is usually the earlier of an invoice being issued by the supplier of the goods/services, or payment being received from the customer. The date on the invoice is considered the time of supply. Because of the invoice basis and the fact that some goods or services are sold on credit, a company often pays VAT to SARS even though it has not yet received
the money from its customers. Let’s see this with a simple example. During John Co’s tax period of January/February, the company sells goods on credit at R11 400 (R10 000 plus R1 400 VAT) and invoices the customer. Suppose the customer only pays John Co in April. In its VAT return for the January/February tax period, which must be submitted by March 25, John Co will have to pay the R1 400 output VAT, even though it’s yet to be paid by the customer. That’s how the invoice basis works. Now suppose that a few months pass and John Co has still not been paid by the customer. Eventually, John Co stops trying to recover the money and writes the debt off. From a VAT perspective, what do you suppose happens? Once there’s no hope of receiving payment, the output VAT paid to SARS must be ‘cancelled’. Instead of allowing for the previous VAT return to be fixed, the tax law has another alternative. The R1 400 (output VAT) becomes input VAT in the tax period during which the debt has been written off. So, when doing the VAT return for the period in which the debt is written off, the R1 400 must be included as input VAT and SARS will refund it. The R1 400 VAT paid by John Co back in March is effectively cancelled at a later date when SARS refunds the amount to the company. n
Lesedi Seforo, Tax Technical Advisor, SAIT
The South African Institute of Tax Professionals (SAIT) is the largest of the professional tax bodies in South Africa, and seeks to enhance the tax profession by developing standards in education, compliance, monitoring and performance. The Institute plays a leading role in developing sound tax policy and shaping fiscal legislation through participation in, and dialogue with, Parliament. For more information, visit www.thesait.org.za.
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SMEs & ENTREPRENEURS
Power of business mentorship When asked about the importance of a mentor for the development and growth of a business, Business Partners Limited SME Index respondents for the second quarter of 2015 rated this service in their top five requirements. According to Christo Botes, executive director at Business Partners Limited, who matches quality business mentors with business owners, all new business owners or entrepreneurs should find a mentor to assist and guide them on their business journey. However, he adds that this process does come with its challenges, and even once a mentor is found with the required skills to assist with a particular problem, the process may not be successful simply because of a
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clash of personalities. ‘But when the match works, there is enormous satisfaction in seeing potential and wealth unleashed,’ says Botes. Finding the right mentor must be handled with care. He offers the following tips to ensure a successful match: • Begin by acknowledging that you cannot possibly know everything about running a business. Even if you are an exceptional all-rounder, individuals always have blind spots. A fresh pair of eyes can quickly spot the gaps and assist with unconsidered strategies.
SMEs & ENTREPRENEURS
• B efore fixing your sights on a mentor, it may be a good idea to carry out a general business health check to establish the business’s strengths and weaknesses, and deciding whether you need a specialist or generalist mentor. Although it is possible to source specialist advice, it may still be a good idea to engage with a generalist mentor who can take a more detailed overview of the business. • Commercial consultants, who charge commercial rates for short, specific interventions, are widely available, but structured business mentorship programmes aimed at matching retired experts and captains of industry who want to ‘give back’ are scarce in South Africa. Business owners can approach Government’s Small Enterprise Development Agency (SEDA), business chambers, or
search for a mentor within their own networks. There are significant resources available to business owners, such as Business Partners’ programme, one of the best resourced networks available in South Africa with over 370 mentors. • Broaden your mentor profile. An accountant could act as a mentor and could look at a business holistically rather than just from a narrow accounting point of view. Modern training gives accountants good generalist skills, making them good advisors for administrative and governance issues. • There is a distinct advantage to finding a mentor who does not need to make a living from giving advice and guidance. These mentors tend to be retired business people who are passionate about assisting entrepreneurs. Unlike commercial consultants, they generally don’t watch the clock as closely, and are more affordable and flexible. • It is important to set clear terms of engagement, stipulating a certain number of hours or the scope of intervention. Mentor relationships can go bad when there are mismatched expectations. Just like any other service, shop around until you are able to find a good match. • Guard against the mentor taking over business issues. This is easily done if the mentor is a retired industry leader used to taking change, or when a business owner feels overwhelmed and is looking to hand over responsibility. The mentor is there to give advice; the business owner must implement the changes. • Business owners should also ensure that they do not develop an unhealthy dependency on the mentor. Business ownership is often a lonely pursuit and every entrepreneur needs an outside confidant or a ‘go-to’ person to bounce ideas off, to discuss strategy, and to make those blind spots visible. Botes says that it is wise to lean on your own understanding and appreciate that there is wisdom in the counsel of many. ‘Mentoring is about empowering yourself to unleash your and your business’s full potential,’ he concludes. n
Christo Botes, executive director, Business Partners Limited
Business Partners Limited is a specialist risk finance company for formal small and medium enterprises (SMEs) in South Africa, and selected African countries. The company actively supports entrepreneurial growth by providing financing, specialist sectoral knowledge and added-value services for viable small and medium businesses. For more information, visit www.businesspartners.co.za.
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MARKETING & COMMUNICATIONS
The state of the marketing address Now in its fifth year, the Integrated Marketing Communication (IMC) Conference has become known for its fresh and engaging content. In August, Emma Dawson attended the event at the CTICC in Cape Town and reports. Cape Town’s 2015 IMC Conference theme – the State of Marketing Address (SOMA) – was delivered by marketing and agency thought-leaders and focused on how to build a world-class marketing programme using consumer insights. Aimed at CEOs, marketing directors and managers, communication specialists, brand managers and entrepreneurs, the IMC Conference offers many compelling reasons to attend. Besides being the only integrated marketing communication conference in South Africa, delegates get the opportunity to learn about the most relevant communication disciplines and trends from top industry speakers. The conference’s practical format is one of its key features. Over the two-day event, delegates chose six workshops to attend, from 12 options. These were hosted by innovative communication specialists who ensured that delegates were able to extract maximum value and take home a wealth of knowledge. Jaco van Zyl, managing director of IMC Conferences, says: ‘We are delighted that the conference was such a
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huge success in Cape Town. The ideas and expertise of our speakers allowed for marketing and communication practitioners to access the latest insights and innovative ideas, while the incredible line-up of workshops that took place offered our delegates a holistic experience of the conference’s offering.’ On day one, Graham Warsop, founder and chairman of The Jupiter Drawing Room, kicked off proceedings with his keynote address, entitled: ‘Marketing – where to from here?’. He provided an informed look at the state of marketing today, and offered his personal perspective on what the future holds. Graham argued that innovative thinking, creative entrepreneurship and an iconosclastic approach to business are just some of the qualities
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Delegates learn about the most relevant communication disciplines and trends from top industry speakers.
MARKETING & COMMUNICATIONS
Photo credit: IMC Conferences
needed to give the top marketers of tomorrow a real competitive advantage. The second keynote address was presented by Bryan Melmed, vice president at Exponential. Bryan’s talk, entitled ‘big data is only human’, warned delegates that marketers need to stop racing towards what big data has promised and to rather focus on what it can actually deliver. The third presentation, by Lynne Gordon, managing director at Added Value, focused on ‘cultural vibrancy – the new essential insight for growth’. Lynne explored how brands can connect with culture and she showcased brands that do. She also provided a practical roadmap to the cultural vibrancy of a brand. The final address on the first day was a joint session by Yegs Ramiah, Sanlam’s chief executive and Santam’s executive head; and Alistair King, founding creative partner at King James Group. Yegs and Alistair discussed how they work together on the Santam and Sanlam brands and what has come out of the partnership. On day two, a presentation by Telkom’s chief marketing officer, Enzo Scarcella looked at ‘the changing face of communication: getting back to why people buy’. With his vast experience in the telecommunications space, Enzo, provided insight into what’s in store for marketers. How changing technology will impact the way we communicate, and its impact on the way we construct marketing campaigns. Paula Raubenheimer, managing director at Southern X, discussed programmatic media and the traction it has gained by allowing brands to make media buying decisions immediately based on a huge amount of learned data.
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The conference’s workshop offer delegates a holistic experience.
Melissa Attree, director of content strategy at Ogilvy & Mather, gave a presentation about how an effective content strategy can strengthen campaigns and boost customer engagement in an omnichannel world. The ninth keynote address was by Tanya Bertram, head of CRM and customer loyalty at OFYT. Tanya revealed the art and science of measuring the impact of marketing planning, and debunked some of the myths around measurement for the sake of measurement. Besides the numerous workshops available to delegates during the two days, the finale keynote speech was from Adam Weber, executive creative director at Joe Public. Adam shared his thoughts about ‘creative executioners’ and how beautifully smart work should inspire just one response... ‘I wish I’d done that’. ‘Some 270 delegates from all over South Africa and Africa attended the IMC Conference in Cape Town, and I’m confident that our event is the most recognised marketing and communication conference around. We aim to expose our delegates to the latest IMC trends by educating, entertaining and engaging them with our incredible line-up of industry experts, our distinctive event format, and the customised workshops feature,’ Jaco concludes. IMC Johannesburg is being held at Vodaworld from November 2 to 3, 2015. For more information, visit http://imcconference.com/# n
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MARKETING & COMMUNICATION
The influence of digital marketing Digital Marketing isn’t simply the future, it’s now – it is five minutes ago and five minutes from now. Although digital is instant, this doesn’t mean that it’s good for lazy marketers who forget to brief in a marketing campaign. Quite the opposite actually. Digital marketing means that marketers need to be current, versatile and, most importantly, accountable. Digital marketing is no longer just a buzzword, it’s the answer to consumers who are turning their attention away from glossy magazines to their shiny cell phone screens. These are the consumers who think TV is no longer swanky and are now fact checking TV advertisements with a quick Google search. Simply put, digital marketing consists of a range of tools (SMS, email, SEO, SEM, affiliate marketing, AVM and social media, to name a few) that are designed to communicate with modern consumers in a more personal way. The tools utilised are measurable, instant and affordable and are the reason why marketers and corporations alike are hurrying to build their own
internal skills or finding agencies that specialise in digital marketing. The contrast to digital media is traditional media, which must not be overlooked. Traditional media consists of TV advertisements, billboard displays and pretty ladies promoting men’s deodorant in glossy magazines. The underlying difference is that there is typically only a oneway communication between brand and consumer when it comes to traditional media. However, it does hold a lot of value when it comes to brand building and creating an overall marketing strategy. Traditional media supports new-age digital media in that consumers are able to familiarise themselves with a brand that is now able to enter their personal space. If you think of the marketer as a photographer, then a quick and admittedly simplistic metaphor can help describe the two schools of marketing. After choosing the right setting, adjusting the light and choosing the correct
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MARKETING & COMMUNICATION
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Digital marketing is no longer just a buzzword, it’s the answer to consumers who are turning their attention away from glossy magazines to their shiny cell phone screens.
shutter speed (market research) the photographer takes the shot. This image reveals the entire picture (marketing plan). The photographer can frame the picture and hang it on a wall (traditional media). However, the editors are also able to zoom into each segment and reveal the details. At this level, the photographer is able to focus on individual people in the photo and add a more personal touch (digital media). Additionally, at this level the overall photo is out of frame, which is why you need both digital marketing and traditional marketing to tell the full story. That is why marketers have added an extra ‘P’ into the marketing mix. Traditionally the marketing mix consisted of product, promotion, price and placement. Now, with the tools available to the digital marketer, marketers are able to add a new ‘P’ to the mix: People. This opens two-way communication between the brand and the people it is engaging with. With digital marketing (and using the photograph metaphor) the editor can instantly find all people wearing a red shirt (profile a target market) and Photoshop a smiley-face onto their shirts (personalised message). That is in effect the big difference between digital and traditional; the ability to precisely profile a target audience to the point where they become individual people. The marketer can then send them a personal message for which the delivery and receipt can be verified and the individual’s action to that message can be measured all the way through to an action. It is the preciseness and measurability of digital marketing that sets the scene for ‘risk-free’ marketing plans where digital marketing agencies only charge their clients for the end result – a hot, qualified lead or a sale (someone who expressed interest in a particular product). Digital marketing agencies are able to charge their clients a fee per sale simply because they are able to pin-point a target market, deliver the correct message at the right time, and follow the client through to an action (be it a sale, intent to buy, or visit to a website). Traditional marketers are unable to match this business plan and are still forced to charge per billboard, TV ad-slot, or page in a magazine. The underlying reason is that digital marketers can deliver leads to a client, while traditional marketers deliver a message to an audience. The question then is which marketing tactic to choose, traditional or digital? The answer really lies in the
brand’s strategy. While a healthy mix is advisable, many companies just don’t have the budget to use both. If you are a SME with a tight marketing budget and a precise plan to increase sales, then the best tactic is to choose the mediums with the highest ROI. In most cases this will reveal a digital marketing plan (especially if the agency offers a risk-free strategy). For larger corporations looking to build a brand then a healthy mix is in order. The marketer must therefore identify the optimal marketing channel mix, which can only be identified after rigorous testing and measuring. Only then can the optimal channels be selected and the non-performers removed. This process needs to be constantly refined, campaign after campaign, to ensure optimal ROI. Of course traditional channels can be enhanced through digital tools and a hybrid channel can be created. Hybrid channels allow marketers to get the best of both worlds, which is why no marketing campaign should ever work in a silo. Digital and traditional play very well together. However, while traditional media is, for all intents and purposes, static (a billboard is a billboard is a billboard) digital media is not. Google is forever changing its search algorithms, social media platforms never stop evolving, and digital TV is now a reality. For these reasons it is important to find a digital marketing agency that is pushing the envelope and keeping up with this constantly evolving industry. ‘Ideally choose an agency that offers a broad range of channels so that you can test which channel has the highest yield. After all, a picture tells a thousand words but numbers tell the true story,’ says Tom Goldgamer from 3 Way Marketing. Digital marketing is a powerful weapon in the marketer’s arsenal. While it might be assumed that traditional media is doomed, the truth is that as long as there are magazines on the stands and cars driving past billboards, traditional marketing is going nowhere. However, because digital marketing has made marketing measurable, accountable and personal, not to mention easily integrated into traditional media, it may be the marketers who have not adopted digital marketing who may be doomed – after all they are the equivalent of the photographer who has not adapted to the digital camera. n
3 Way Marketing is one of the largest lead generation firms in South Africa, with over 120 000 qualified leads generated per month. Leads are generated through 3 Way Marketing’s own in-house channels (SMS, Email, AVM, Google Pay Per Click, centre agents) to ensure optimal pricing for client’s. For more information, visit www.3waymarketing.co.za.
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SUPPLY CHAIN
Supply chain impacts: Are you ready? By David Telford, Senior Director, Sector Group & Industry Partner Lead, Qlik
If the past were to repeat itself, supply chains of the future will evolve in line with the global trends that are fuelling the economy, and transforming society and culture. Often described as the heart and lungs of any organisation, the supply chain, more than any other business function, is not only sensitive to the pressures of global trends, but is also required to be the first to respond to them. Said demands, and the unabated business requirements to cut costs, improve efficiency, and boost performance, leave supply chain executives between a rock and a hard place – how do they innovate to keep pace with global trends while driving efficiency and meeting customer demands?
Let’s start by exploring the triggers for supply chain evolution and the trends supply chain executives need to keep track of. Today we see six developing trends that are affecting the way organisations do business. They will dictate the future macro-economic environment, with each trend having a direct impact on how organisations structure and operate their supply chains. 1. Globalisation Globalisation makes the supply chain much more complex to manage – as complexity increases, so too does risk and cost. The natural disasters in Thailand and Japan in recent years have emphasised the need for effective risk management in the supply chain to reduce disruptions and address outages quickly. As more manufacturing work is outsourced to suppliers around the world, it becomes far more difficult to supervise and track production. 2. The rise of the consumer The interaction between companies and their consumers have evolved considerably in the last ten years. New technologies in particular – social media, mobile and cloud-based applications – have empowered customers and consumers and offer new, direct access to brands. With this, and consumer-led mass customisation of products, there is an even greater need to understand and anticipate customer requirements. Once captured, they can be fed into future product development, supply chain planning and demand management. 3. Sustainability and climate change Climate change is rising up the global political, corporate and consumer agenda. There is increased regulation,
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Often described as the heart and lungs of any organisation, the supply chain, is not only sensitive to the pressures of global trends, but is also required to be the first to respond to them.
SUPPLY CHAIN
a greater focus on corporate and social responsibility, and demand from consumers for high environmental standards. These forces impact supply chains in multiple ways. Most of the social and environmental impact made by companies around the world happens in the supply chain where shipments are dispatched, materials consumed and labour employed. Accountability for a company’s sustainability performance will fall almost entirely on the supply chain. To ensure long-term success, supply chain leaders must own sustainability. 4. Technology convergence Technology that enhances information processing and decision-making, such as the combined power of data analytics and the Internet of Things (IoT), allow organisations to gain deeper insights into trends, consumer behaviours and process efficiency. Collating both unstructured and disparate data sets together, from consumer sentiment on social media to machine to machine data, provides new frontiers in supply chain transparency and process automation. However, the dependency on data sources of this kind does necessitate careful integration of systems, new and old, to deliver true end-to-end supply chain visibility. 5. Regulation Linked to the growing complexity of global markets and the importance of security, global and local policy makers are imposing far stricter regulations on companies. With more rules and regulations continually being introduced, organisations have to be prepared to divulge information about sourcing and supply chain practices. If noncompliant, they can expect to be handed expensive penalties and expose themselves to other legal risks. Technology has a big part to play here as it can provide the visibility required to ensure full compliance across the chain. 6. The commercial supply chain In an era of tighter credit and economic uncertainty, better working capital performance has become a top priority for many CFOs. The major levers such as finished goods inventory, raw materials inventory and accounts payable/receivable are all heavily influenced by supply chain decisions and activities. The pressure to deliver profitability requires the ability to measure the true costto-serve for every order and, therefore, allows for better negation and value. However, for supply chain executives on the front line it’s up to them to spot the early warning
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Effective measurement of supply chain performance across the value chain is critical.
signs of supply-demand issues and how they will impact profit and revenue targets for the company. For most organisations a number of these forces will collide at once, pushing business and supply chain leaders into action. Understanding the implications that these forces could have on the business before the impact helps supply chain executives to exploit the opportunities that can be found, and help maintain longterm competitiveness for the business. To help organisations shape their future supply chain around these trends and to balance the often conflicting priorities they face, we suggest focusing on: • Collaboration: Internal and external collaboration with customers and suppliers is imperative to both identify and efficiently fulfil demand. • Visibility: You need to be best-in-class to thrive in today’s challenging environment. Effective measurement of supply chain performance across the value chain is critical to achieve this. • Efficiency: Continue the drive to reduce supply chain costs to maximise profit and competitiveness – managing volatility and complexity. • Agility: Increased agility enables organisations to respond quickly to sudden changes in supply or demand. This means handling unexpected external disruptions smoothly and cost-efficiently, and recovering promptly from shocks such as natural disasters. The place between the rock and the hard place will always be challenging. However, it is possible to carve out a successful supply chain future if these simple practices are applied. n
David Telford Senior Director, Sector Group & Industry Partner Lead, Qlik
Qlik provides a platform-based approach to visual analytics that brings insights and clarity to where it’s needed the most: the point of decision. This empowers the entire organisation to make decisions with confidence and transforms business analysts and knowledge workers across the organisation into indispensable champions. QlikView South Africa is the local representative and distributor for Qlik. For more information, visit www.qlikview.co.za.
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SUPPLY CHAIN
Curb logistics costs, secure economic growth South Africa’s transport sector, despite accounting for 60% of total logistics costs, could be nearing a stalemate. Owners and operators, even at their most efficient, are at the mercy of escalating road tariffs, upped driver fees, rising maintenance costs, and, of course, erratic fuel prices. For transport-hungry South Africa, the well-being of its logistics sector is crucial. ‘We are running out of options,’ cautioned Zane Simpson during his presentation of the Logistics Barometer, launched in June 2015 by Stellenbosch University, at the recent 37th Annual SAPICS Conference for Supply Chain Professionals. Logistics not only embraces the transportation of goods or people, but the organisation of all links in an immense supply chain – from source to warehousing, inventory, and even security. It is therefore not just transportation methods that need a rethink, but changes to all the links that impact rising costs.
A farm nearer the fork Different to Europe, where most agricultural goods are produced within a small kilometre radius of the point of sale, South Africa’s transport distances are extensive, compounded further by inland mineral reserves that must be transported to seaports. Inland, Gauteng especially has a high demand for goods requiring long-distance carriage. Based on the current rate of demand growth, freight is likely to triple over the next three decades from the current 781-million tons moved annually. ‘Imagine three times the number of trucks on our road network and the impact this would have on road infrastructure, traffic and delivery times. If we don’t change, a system shock is inevitable,’ Simpson explained. ‘What we still can change is behaviour on the demand side. Consumers are spoilt for choice,’ he added. ‘By demanding less variety, consumers will inevitably reduce the amount of transport needed, saving money, resulting
in less road congestion, and ultimately benefiting our environment. The logistics industry, too, must be transparent about these benefits.’
Consider all options ‘There has to be a change in the way goods flow between points; whether it be driven by technology or by this reduction in the variety of brands and options on offer to consumers.’ In cases where no alternative exists other than to convey goods over long distances, intermodal transport (moving containers using multiple transport modes) could have a dramatic impact but requires significant investment into rail systems. ‘The future would have to include a fixed mode of transport,’ Simpson pointed out. Simpson and his team propose that all other conveyance options – alternative technologies, even the unconventional, need be considered. ‘3D printing items close to source, for example, rather than having to transport from afar would help to reduce transport demand and subsequent costs. Seemingly ridiculous ideas even, such as building a canal between KwaZulu-Natal and Gauteng, long distance conveyor belts, or drones, need to become part of mainstream conversations if we are to reduce logistics costs,’ he suggested. ‘Overall, instead of trying to reduce transport costs in isolation, we need to work hard at economic growth, which will solve more problems than just increasing logistics costs.’ n
The aim of SAPICS, a professional membership-based association, is to advance individuals and organisations in Supply Chain Management through participation in its educational programmes, events and its annual conference. SAPICS’ wide range of education opportunities include the world-renowned international qualifications, CPIM and CSCP from APICS, and the CPF from the Institute of Business Forecasting in the US. For more information about SAPICS, visit www.sapics.org.za.
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Sms “SABI” to 45738 and we’ll call you. Or call us on 0860 73 53 63. www.selfmed.co.za
HEALTH & SAFETY
Reduce stress and HaveHeart The Heart and Stroke Foundation South Africa (HSFSA) wants all South Africans to HaveHeart in September for Heart Awareness Month by showing you care. September is dedicated to raising awareness about cardiovascular disease in South Africa and culminates on World Heart Day on September 29. Heart Awareness Month has long been a platform for raising awareness about heart disease and highlighting the importance of a healthy lifestyle and appropriate treatment. This year, the theme for Heart Awareness Month is to HaveHeart and show you care. One aspect of heart health includes managing stress levels.
Is work stressing you out? You may feel that you are coping well with stress, but stress can cause cardiovascular disease, and it is particularly important to reduce stress if you have other risk factors or have already had a cardiovascular event. Although it is not a major risk factor, there is evidence that stress can contribute to cardiovascular disease in some people. Research has found that people are more likely
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to feel stressed when they believe they have little control over their work and have lots of demands placed on them. It may not be practical to change your job, but you can take steps to manage stress at work. Bear in mind that it is not stress by itself that causes heart disease or stroke, but an unhealthy response to stress that may lead to other risky behaviours, such as smoking, drinking too much alcohol, overeating or skipping meals, and eating high-fat, convenience foods. Other risk factors such as physical inactivity, high blood cholesterol, and a family history of cardiovascular disease all act together with stress and contribute to your risk of heart disease or stroke. For some people who have angina or who have had a heart attack, extreme stress could trigger an angina attack.
Some stress is good Be wary of cutting out all forms of stress, as some may actually be positive and help speed up your recovery, especially if it is a rewarding activity. A certain amount of
HEALTH & SAFETY
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Have heart and show you care.
stress may help you feel motivated and enthusiastic. It is only when there is too much stress for too long that it becomes unhealthy.
Reducing stress at work Identify what you are feeling and talk about it to a sympathetic colleague or friend. • Work out what your priorities are and drop the less important things – tomorrow is another day. • If you have trouble managing your workload, talk to your team and work out a time management strategy. • Become more assertive by learning to say no or delegate when you feel over-burdened. • Handle challenges and face difficult decisions – don’t ignore them or procrastinate. Effective problem solving and decision-making will help relieve stress. • Let go of perfectionist ways and allow for mistakes or delays that are inevitable. • Make the effort to leave work on time at least twice a week and use the extra time to do your favourite hobby or physical activity. • Make more time for rest and relaxation. A good night’s sleep will help you cope with stressful situations. • Make sure you have lunch every day, even when you are really busy, and eat more fruit and vegetables. Avoid too much refined, processed or convenience foods that are high in fat and salt. A healthy diet is a good stress coping mechanism. • Drink plenty of water and reduce you caffeine intake (cola, coffee, tea or chocolate). • Quit smoking and cut down on alcohol. • A lunchtime walk can help you to take a break and return feeling refreshed and invigorated. By making a few small changes and getting the balance right, you will be well on the way to a healthier lifestyle. You will probably find that you feel more positive, have more energy, and are better able to cope with stressful situations in your workplace.
What does the HaveHeart campaign mean? We can all HaveHeart by getting screened to identify what puts us at risk for heart disease and strokes.
Following that, we can show we care by beginning to take charge of our own health. We can HaveHeart for our families by encouraging a healthy home environment. Make it easy for your family to be healthy and take care of their hearts for the future. Additionally, we can HaveHeart by helping to create awareness about heart disease and making South Africa a healthier country. You can help us do it!
Why a month-long focus? Heart disease and strokes are the second biggest killer in South Africa, after HIV/AIDS. Once thought to be a disease of the elderly, heart disease now affects people of working age, with more than half of deaths occurring in people under the age of 65 years. Our lifestyles are largely to blame for this growing problem – we eat too much, smoke and drink too much, and are not keeping active. Our children are particularly vulnerable and influenced by our unhealthy environments, and are at risk for heart disease from a young age. Here are some of South Africa’s shocking statistics: • South Africa has one of the highest rates of high blood pressure worldwide: one in three adults • High blood pressure is a silent killer – 75% of people with high blood pressure don’t even know they have it • One in five children in South Africa smoke • One in two adults, and a quarter of children, in South Africa are overweight • 210 people die from heart disease every day • 80% of these premature deaths can be prevented by eating better, moving more, and avoiding smoking.
Help spread awareness about heart disease and win a heart healthy hamper The HSFSA needs everyone’s help to create awareness about heart disease and calls on the public to get screened. Here’s how you can help: 1 G et screened at your nearest Dis-chem during September 2 J oin the campaign by posting a photo of you getting tested along with your numbers on our Facebook wall to stand a chance of winning great spot prizes! Help us spread the word about looking after your heart by using #HaveHeart. 3 Challenge all your family and friends to get tested too. 4 T erms and conditions apply. Visit www.heartfoundation.co.za n
About the Heart and Stroke Foundation The Heart and Stroke Foundation South Africa (HSFSA) plays a leading role in the fight against preventable heart disease and stroke, with the aim of seeing fewer South Africans suffer premature deaths and disabilities. Established in 1980, the HSF is a nongovernmental, non-profit organisation. For more information, contact the Heart and Stroke Health Line on 0860 1 HEART (43278) or visit www.heartfoundation.co.za.
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TECH TALK
Best iPhone alternatives The Apple iPhone may have been the first popular smart phone and the smart phone commonly noted as being the ‘best’, or the phone to carry the highest status level – at least by early adopters. The iPhone 1st gen was unveiled to the public by Steve Jobs on January 9, 2007, and ever since then every new model launch results in a line, many miles long, of eager would-be new iPhone owners. Some camp out for weeks, while others pay absorbent prices to secure their fancy new iPhone. Technology has marched on since that first iPhone in 2007. Many entry level phones launched today carry the same or similar specifications of an Apple iPhone that was released just a few months ago. So there is no need to stay ahead of the pack. Today’s early adopters carry outdated technology tomorrow. That is not to say that the Apple iPhone is a bad choice. We are not saying that at all. The Apple iPhone is a remarkable device. The iPhone comes equipped with cutting-edge technology, sleek design, iCloud, and some of the most professionally coded apps available. It can be argued that the Apple iOS is superior in many ways to the alternatives. However, the iPhone does come with a hefty price tag that may put the phone out of reach for many customers. So what are the next best alternatives?
Samsung Galaxy S6 Samsung is leading the pack when it comes to iPhone alternatives. Many would argue that Samsung is even leading the pack in smart phones generally, with Apple coming second. The Galaxy S6 comes with a 5.1-inch QHD resolution display and with three times more pixels than the iPhone 6 screen. HTC One M9 This phone is exceptionally classic with its brushed aluminium finish. While it may offer slightly less in terms of power and functionality, it certainly looks amazing – both in its physical and software design. The HTC is notable for making the most of the Android OS. Sony Xperia Z3 Getting slightly simpler and therefore more affordable is the Sony Xperia Z3. This smartphone offers a simple experience, free of the extra junk some other phones may have. One distinctive factor that sets the Z3 apart from the iPhone (and for that matter many other phones, too) is its waterproof casing. LG G3 That’s right, LG makes phones – and it makes them good! The LG G3 has 62% more pixels than the iPhone, and it has impressively thin bezels, which means that this phone seems substantially bigger than the Galaxy S6 but is, in fact, is only 2mm taller. n
Pic credit: www.phonefinder.co.za
Phonefinder is South Africa’s mobile device marketplace, offering services such as phone repairs, unbiased contract comparisons, assistance for blacklisted clients, and other value-added services that enhance user’s cell phone experiences. Over the past year Phonefinder has become South Africa’s largest cellular services price comparison site, now listing over 5 000 deals from all of the country’s mobile network operators. For more information, visit www.phonefinder.co.za.
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TECH TALK
6½ Considerations for securing the home office By Perry Hutton, Fortinet Africa Regional Director
As increasing numbers of employees work from home, organisations often overlook the security needs of remote workers.
Telework predates the BYOD phenomenon by decades. Despite Yahoo!’s move to the contrary, many organisations are shrinking their office spaces and expanding their employees’ ability to work from home. Employees value the flexibility and the lack of a commute, while employers value lower operating costs and workers’ extended working hours. Even companies that don’t encourage telework specifically, frequently have employees working remotely, whether for travel, to accommodate a sick child, or simply to save some extra hours of productivity. In a study in June 2014, market research firm, Gartner, even confirmed that the desktop computer is, in fact, not dead. Of the 40% of respondents who reported using personal devices for work, the most common device was a desktop PC, presumably in a home office. The bottom line for all of this, though, is that organisations
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need to take the security of their employees’ home offices seriously. Let’s take a step back and think about what actually constitutes a modern home office. For some, it’s clearly a space in the home, quite possibly occupied by a desktop computer discarded by the kids in favour of a shiny new iDevice. For others, it might be a desk in the local library or a comfy wing chair at their local coffee house. In our exceptionally mobile world, our ‘home offices’ can literally be anywhere that isn’t company property. What this means is that securing the home office is really about taking a holistic approach to endpoint security and remote access rather than making sure that employees have something more than WEP securing their wireless routers at home. Here are some critical best practices for creating secure remote work environments, wherever they might be.
TECH TALK
1. Use a VPN This is a big one. No matter how an employee accesses corporate resources, if done with a correctly implemented VPN tunnel, content moving to and from employee resources is secure. There are even VPNs offered as a service to secure mobile sessions over public WiFi, but building VPNs under corporate control is easy, cost-effective, and ultimately safer than relying on VPNs in the public cloud. 2. Enforce client antivirus installation and updates Multi-layered approaches to security are critical to ensuring their effectiveness, both within corporate networks and outside of them. At the same time, it can be difficult to ask users to protect themselves or their employers’ networks. Running antivirus updates and OS patches tends to fall fairly low on their list of priorities so implementing services that enforce automatic updates on clients outside of corporate networks is a must for remote workers. 3. Prevent the use of consumer cloud storage products As consumer cloud storage products like Dropbox and Google Drive have become more fullfeatured and easy to use, it becomes very tempting for users to simply upload work files to the cloud, alongside Grandma’s pumpkin pie recipe and pictures from last summer’s vacation. Unfortunately, when employees leave a company, there is no way for employers to ensure that corporate assets don’t stay on that desktop computer in the ex-employee’s home office. Preventing access to these services while employees are on the network provides a layer of protection and control, not to mention regulatory compliance for many industries.
5. Wherever possible, secure the environment While it isn’t possible to go to every users’ home to deploy an access point, and centrally manage them as one can do in a corporate network with optimised security settings, it is possible to require home office users to
implement strong encryption on their home routers. Even if that means stepping a user through the setup or offering 4G hotspots at a discount to employees (that use encryption by default), it makes sense to take steps to ensure a relative degree of security on home networks. 6. Security begins with education Security pros and hackers aren’t born with deep security and networking expertise – why should we expect employees to be automatically savvy enough to avoid the latest phishing scheme or bit of malware? Unfortunately, that’s all too often the mind set for many organisations, the majority of which rely on firewalls, intrusion prevention systems, and antimalware software to protect their networks but ignore the real weak link in the security chain: users. Even large organisations with strong security measures have been brought down by unwitting users who fell for sophisticated social engineering and disclosed login credentials or introduced malware onto the network. 6½. Have a policy This is the ‘½ a consideration’ because it seems as if it should go without saying. But recent research suggests that a lot of organisations have no written policy on personal devices, home offices, or remote access to company networks and assets. Perhaps this should have been #1? Good, well-thought out policies that both IT and employees can live with are a cornerstone of good security. To implement policy with technology, companies need the underlying policy. n
Pic credit: Fortinet Africa
4. Provide platforms that avoid the use of removable media and facilitate secure collaboration Of course, if users can’t upload their files to their personal cloud-based storage account, they’ll be tempted to load them onto flash drives or other removable media to access them at home. However, well-publicised vulnerabilities on these types of media make this a dangerous prospect. The solution? Provide businessgrade tools for secure file sync and share and enterprise collaboration so the temptation of thumb drives and cloud storage are easy to resist.
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The bottom line is that organisations need to take the security of their employees’ home offices seriously.
Perry Hutton, Fortinet Africa Regional Director
Fortinet is a global leader and innovator in network security. Its mission is to deliver the most innovative, highest performing network security platform to secure and simplify your IT infrastructure. It provides network security appliances and security subscription services for carriers, data centres, enterprises, distributed offices and MSSPs. For more information, visit www.fortinet.com.
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SOCIAL INITIATIVES
A bank with a difference Established in 2009, FoodBank South Africa is a registered non-profit organisation that provides a national logistics infrastructure that collects (rescues) edible surplus food from manufacturers, wholesalers and retailers. The organisation was set up with the support of government and other non-profit organisations in response to the growing problem of food insecurity. South Africa produces enough food to feed all its people. Yet, one third of all food produced ends up in landfill sites, while more than 11 million people are living without the security of regular meals. The cost of this food waste to society is estimated at R32-billion, and contributes 18% to global warming because of the harmful greenhouse gas emissions. Annually, FoodBank South Africa rescues close to four million kilograms of food, with an estimated value of R97-million, which is distributed to over 400 verified nonprofit organisations that provide meals, skills development programmes and education to over 100 000 people in ECDs, unemployed youth training centres, school children, the disabled, the aged, and unemployed and abused women. Because of its national infrastructure, FoodBank SA has the capacity to unlock access to large quantities of food and provide this food to insecure households. With a cost per meal of only R1.19, it makes foodbanking a costeffective solution to the problem of hunger.
FoodBank SA’s programmes include: • Food Rescue This involves sourcing, collecting, sorting, storing and distributing surplus edible food to verified NPOs. • Procurement Where funding permits, FoodBank SA purchases basic food items such as samp, sugar, beans, rice and maize meal, among other staples. • Project Management FoodBank SA implements large-scale feeding programmes on behalf of government and donors wishing to make a greater impact. In January 2015, FoodBank SA introduced an exciting new innovation called ‘Virtual Foodbanking’. Through this initiative, FoodBank SA is able to link its beneficiary organisations to the closest participating retail stores to collect fresh produce and bakery goods. Virtual Foodbanking has made significant cost-saving possible and ensures that the rescued food reaches beneficiaries is as fresh as possible. FoodBank SA relies on the generosity of corporates and individuals to implement this cost-effective solution to feed hungry people. There are a couple of ways to help FoodBank SA. Either feed one hungry person for a year by donating R480, or make a monthly donation of R40. For more information, visit www.foodbanksa.org, email info@foodbanksa.org, or call 021 531 5670. n Pic credit: FoodBank
Annually, FoodBank South Africa rescues close to four million kilograms of food, with an estimated value of R97-million.
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COMPANY PROFILE
Macroeconomics: True understanding at all levels Nancy Aspeling, director and founder of Naspeling, discusses the rationale and significance of a general understanding, awareness and interpretation of the rapidly changing world around us. With more than 30 years fulfilling various roles in the corporate financial services industry, Nancy Aspeling witnessed the dramatic change in the South African political and economic landscape. ‘The impact of globalisation and continual technological advancement for organisations and their employees were immense. Gradually the workplace began to undergo a complete metamorphosis with the departure of educated, knowledgeable and experienced middle managers on one hand, and inexperienced graduate entrants on the other – leaving a significant skills gap,’ she explains.
Setting the scene ‘The continuous tightening of regulations and controls, as well as the pace of change and increased business complexities, led to an already overwhelmed workforce – largely functioning in survival mode – becoming increasingly uninspired and disengaged. While new entrants into the workplace were well qualified, the vital business ingredients of experience, confidence, enthusiasm and commitment seem to have been lost,’ Nancy adds. ‘Reversing this debilitating trend of disengagement in the workplace seemed the only way forward for true economic progress to succeed in business and holistically as a nation. Skills transfer programmes and initiatives greatly contributed towards the positive change in people for the benefit of their own personal growth, community upliftment and business improvement. Yet the most vital ingredient still seemed to be absent,’ she explains. ‘This observation eventually lead to the profound discovery that, despite the fact that many people in the workplace studied economics at a tertiary level, there was still a huge gap between theoretical knowledge and the practical understanding, interpretation and application thereof. ‘Technological advancement brought about increased consumer demands with the expectation of an accompanying improved level of expertise in the workplace. However, this was sadly not forthcoming. Generally, the unsettling lack of enthusiasm and personal drive had almost become a common phenomenon in both the private and public sectors. People were
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“
… The point is to understand.” Albert Einstein
COMPANY PROFILE
pushing keyboard buttons to arrive at generic systemdriven outcomes, they conformed to organisational and company cultures, complied with laid down policies and regulations, and did exactly what was expected of them. Nothing less, but also nothing more. The internet age and continual technological advancement turned out to be an inevitable aid in the constant quest for business survival and reinvention, while its downside was the detrimental effect on the human spirit – plagued by feelings of disempowerment and no autonomy or control. The competitive advantage in any business is mainly rooted within the quality of its human capital. Those ordinary people with the distinct ability to make customers come back for more, the catalysts who inspire others with their confidence and enthusiasm, those who contribute towards business growth, and who want to be there because they are driven by the stimulus of feeling valued. This is the deal maker or deal breaker – and the missing ingredient in the makeup of the contemporary workplace that is in dire need of confident people who take pride and ownership in what they do, who make a daily impact in their unique sphere of influence, who work towards business growth, job creation and opportunity. The only question that remains, is how?
A simplistic, yet profound solution Modern day media has come a long way since the era of mainly print, audio and video. Ever evolving digital and social media, livestream, and cloud services on handhelds are transforming our world – and there’s no end in sight. The point is, access to information is widely available to the majority of employees. Why then does it seem that so few are interested and proactively aware of what is happening in the world around them? And why does it seem that reading business articles is reserved only for the few? ‘The answer to these questions eventually hit home,’ says Nancy. ‘I realised that, in general, people in the workplace were unsure of how to interpret business articles, how to reason or debate the potential consequences of business, economic or political events – how to stimulate their own thought process, firstly through knowledge, then understanding, and finally through interpretation. It all became quite clear: What is the point of reading mind-boggling business and economic jargon in articles that make no real sense? Only people with a solid foundation of knowledge and confidence are able to take pride in conversing in an informed and credible manner and negotiate from a basis of fact and understanding,’ she adds. Over a period of nine years, and while still working in the corporate environment, Nancy painstakingly developed a visual-based learning concept in macroeconomics. ‘The eventual goal was clear from the start. The final product had to be time efficient and cost effective, while offering the potential of immediate application of learnings in the workplace,’ she points
out. ‘Additionally, there had to be no compromise on fundamentals and course content, learnings would have to be applicable for all economic sectors and industries, and the return on investment had to be measurable.’ In hindsight, Nancy recalls that her initial developmental challenges were actually a blessing in disguise. ‘The response to the learnings was a resounding success and extremely rewarding. This unique learning concept proved to be highly effective and the perfect match to the requirements of an accelerating technology-driven business environment,’ she notes. ‘After gaining the knowledge and a true understanding of the interrelatedness of macroeconomics, many people on a clerical level began debating matters such as the likeliness of the Monetary Policy Committee increasing interest rates, inflation, possible reasons for our strengthening/weakening currency, the possible effects of credit rating downgrades from Moody’s… and the list goes on. Previously complex jargon now makes sense, and with that understanding came self-directed learning and entrepreneurial thought.
A unique learning method Naspeling offers a unique and comprehensive macroeconomic skills development and training intervention aimed at all levels of employees from customer interfacing to executives in the private and public sectors. ‘A fresh approach to training and development methods was long overdue and this is what greatly differentiates Naspeling from conventional development methods,’ Nancy insists. Through the use of the most up-to-date presentation technology, Naspeling’s course content is based on the latest economic and business data and articles that can potentially affect our economy, business and society. ‘The relevance of real time information and the interpretation of its possible consequence through knowledge and awareness ensures a captive audience by stimulating the thought process. This is the kind of effective upskilling, combined with creative and practical applications that is so desperately required by a country in dire need of business growth, entrepreneurship and job creation,’ Nancy concludes. n
Naspeling W www.naspeling.com E info@naspeling.com
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ADVERTORIAL
Collaboration for socio-economic development REDISA’s successful implementation of a circular economy is an example of what’s possible when the public and private sectors collaborate. According to Stacey Davidson, director at REDISA (Recycling and Economic Initiative of South Africa), the circular economy, where we use the same commodity over and over again, is the only way to ensure responsible consumption of resources. ‘Job creation and small business development are a major part of our business plan, and our five-year target is to create 10 000 jobs and 200 business entities that collect, store and recycle waste tyres. One of the ways we can fast-track this process is by creating circular economies,’ Davidson explains. ‘The reality is that most businesses do not consider the waste that comes from their products or operations as their problem, and few factor the cost of recovering and recycling this waste into their cost of manufacturing, which is in turn costing the environment dearly,’ she adds. ‘We firmly believe that looking at the use of consumer products further than the end of their accepted lifecycle and reintroducing them back into the economy will go a long way towards reducing our reliance on fossil fuels for new product development. In South Africa, we have millions of waste tyres lying in dumps and stockpiles, or scattered across the country in residential, industrial and rural areas. Almost 10-million waste tyres are added to this number every year.’ Tyres are designed to be tough and nearly indestructible, which is good when they are in use but a problem when they reach the end of their working life. While some waste tyres make their way to recycling facilities via formal and informal networks of collectors, many are burned for their scrap metal content, releasing toxic fumes and liquids in the process. The REDISA Plan was developed to address the waste tyre problem in a manner that stimulates job creation and entrepreneurial development. As REDISA gains momentum, used tyres will grow in value.
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Looking at waste differently The gradual increase of waste generated in South Africa is leading to an increasingly polluted environment in which South Africans, particularly those in the informal sector, are forced to live. ‘This challenge has left the country with no other option other than to seek measures to divert waste away from landfills to other waste management options such as the reuse, recycling and recovery of products, as well as energy generation,’ Davidson maintains. For example in the tyre industry, it means reusing, repairing, refurbishing and recycling existing materials and products. In other words, what used to be regarded as ‘waste’ can be turned into a resource and reintroduced into the economy. ‘At this stage, the tyre industry is the only industry in South Africa where waste is being dealt with in an integrated, coordinated way. What’s more, the REDISA system is the only one in the world that has 99.9% industry compliance with one waste management plan (99.9% of tyre manufacturers and importers are registered with REDISA and pay R2.30/kg to outsource their tyre recovery and recycling liability to us),’ Davidson claims. ‘By involving all stakeholders, government and private sector, the REDISA tyre industry circular economy model is working: tyre manufacturers and importers are taking responsibility for their waste without losing sight of focusing on their core business; unemployed people are finding gainful employment, SMMEs are being developed and supported by the REDISA Plan, and the environmental disaster that waste tyres represent is being economically and effectively addressed.’ Without legislation by the Department of Environmental Affairs implementing the REDISA Plan would never have been possible, and the success would never have happened. ‘While the circular economy is growing, it is happening at a slow pace. If the circular economy is to become more widespread, we must look at all industries to see how through innovation and cooperation we can double our efforts,’ says Davidson. ‘The results are evident. Through REDISA’s collaboration with government on the one hand, and tyre manufacturers and importers on the other, in two years we’ve helped to create over 2 500 new jobs and start 201 small businesses, simply by seeing used tyres differently.’ In the near future, REDISA is looking at rolling out the model used for tyres to alleviate the general waste problem in the country. n
REDISA W www.redisa.org.za