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CONTENTS
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REGULAR SECTIONS
LEGAL 40
TAX 44
n CASH CRUNCH CONTINUES!
n FAMILY BUSINESS FINANCE!
ASSETS & INVESTMENTS 52
n THE SCIENCE & ART OF VALUING SMEs
MANAGEMENT 18
n FISCAL CLIFF LOOMS!
n THE URBAN INCENTIVE
FINANCE & EQUITY 48 PROCESS & OPERATIONS 72
n ENERGY EFFICIENT BUILDING BENEFITS
BANKING & INSURANCE 56
VIEWPOINT 14
n BANKS MUST RESTORE TRUST!
n LEGITIMATE DEBIT ORDERS?
n OUR DISRUPTIVE ERA! YOU CANNOT USE TODAY’S THINKING FOR TOMORROW!
n UNSEATING THE PALE MALE!
n DANGER BENEATH THE WATERLINE!
MARKETING & SELLING 60
n A WORLD WITHOUT ADVERTISING...?
n BRAND MARKETING’S FUTURE?
EDUCATION & TRAINING 36
n E-LEARNING STEPS UP A NOTCH
n FAMILY FRIENDLY MBA?
HUMAN CAPITAL 64
n PATERNITY LEAVE PAINS?
INFORMATION TECHNOLOGY 68
n THE FIBRE LAND GRAB IS ON!
n YOUR SECURITY’S FUTURE
n THE CATALYST FOR STABILITY!n POSTAL SERVICE REDUNDANT?
FEATURE
ENTREPRENEURSHIP: START-UP SUCCESS 22
n YOUTH UNEMPLOYMENT SHOCK!
OTHER SECTIONS
n ALL THE LATEST GADGETS, GIZMOS AND OFFICE MUST-HAVES
BRIEFCASE 6
n EXQUISITE LOCAL DESTINATIONS
TRAVEL & LEISURE 10
n ALL THE LATEST EVENTS
n CONSULT OUR CONTRIBUTORS DIRECTLY FOR PROFESSIONAL ADVICE
SEMINARS & CONFERENCES 79
CONTRIBUTORS 80
n VERBATIM MEDIASHARE WIRELESS
n NUTRiBULLET NUTRITION EXTRACTOR
GIVEAWAY 6
n AN ARM & A LEG?
n ONE ENVIRONMENTAL SYSTEM REQUIRED!
2
n SOLAR: THE SMART ENERGY OPTION
28th & 29th May 2015EMPERORS PALACE
For ticket bookings, and further opportunities to sponsor or exhibit at the event,
visit www.meindaba.co.za
POWERED BY
It is an opportunity for stakeholders to exchange
ideas
Industry thought-leaders are provided a platform to
share and present ideas
Companies will have the opportunity to show-case
products and services
It will be a platform for networking and exploring
new markets
An important platform for business leaders to
engage with other decision and policy makers in the
region
you should attendWHY
4326
Wet
pain
t Adv
ertis
ing
Metals andEngineeringINDABA
S o u t h e r n A f r i c a n
Engage Network and infl uence decision and policy makers from Southern African governments in the manufacturing, metals, construction and engineering industries.
Innovate Stay ahead of the times by sharing and exploring cross-sector innovations with the industry pioneers.
Sustain Play your part in crafting the foundation for an industry that takes care of future generations’ environmental, social, political and economic interests.
ContributeBe part of the search for solutions to the challenges confronting manufacturing in the region, but especially the metals and engineering sector.
Electrical sector
Construction sector
Metals sector
Engineering sector
General manufacturing sector
Product and service providers to the above
sectors
Government and private sectors
WHO WILL ATTEND? Decision and policy makers, current and potential investors, captains of industry, business owners, senior executives, managers, industry suppliers and other affected or interested stakeholders in the following sectors:
4326 BusinessBrief_275x210.indd 1 2014/11/17 11:07 AM
4 EDITOR’S NOTEE
Collapsing municipalities. Deteriorating infrastructure. Rife corruption. Petty squabbling. Rudderless leaders. Squalid CBDs. Rampant crime. Increasing murders. Violent strikes. Excessive force. Fallen heroes. Slaughtered rhinos. Enraged labourers. Burning streets.
Will the madness end? What will disrupt the status quo? Where can we invest for our future?
The smart money is on Africa. Everywhere, entrepreneurs are springing up and building businesses. Ideas spread exponentially as competition heats up, but the opportunities are vast and there is enough room for savvy individuals with the spark to make things happen.
Knowing what to do and how to do it isn’t enough. You need to do it. Too many ideas lie on dusty shelves. We can moralise and complain from armchairs or we can use our wits to
outsmart challenges, find opportunities and build businesses.
The world is a bizarre beast. Some of us are making money and living comfortable lives while others of us are in dire need of assistance. There is always inequality within society but below-the-breadline poverty is intolerable and outrageous. It can be eradicated if we
implement good governance and figure out how we can employ the most people without compromising efficiency and profitability.
To begin a venture is like nurturing a child – it is exciting and daunting daily – but the rewards are worth it when your child excels. Entrepreneurs require a healthy balance of passion,
patience, creativity, expertise, leadership and discipline. They must delegate effectively, have the initiative to act decisively with empathic understanding and be inured to
failure. Our feature, Entrepreneurship: Start-Up Success offers advice from experts with first-hand knowledge on what is required when running a business. The aim of your business must to be to fulfil a need in society – once this is accomplished the cash will follow.
The pace of change is picking up – it is exciting to be alive during such a tumultuous period in history as we can watch new technologies unfurl
and disrupt the status quo. The tsunami of technology will continue to steamroll old systems and process – it is imperative that we keep up. In
our cover story, Our Disruptive Era! You Cannot Use Today’s Thinking for Tomorrow! Graeme Codrington explains what can be done in
order to surf the biggest wave of modern times.
The future is hazy – will it be bleak or will it be sublime? The answers to our problems are readily available; we already have enough technical know-how to overcome just about anything. What we lack is the leadership to take us forward – we are forever stalled by endless roundtable discussions where fat-cats
deliberately deliberate drivel while people suffer. If we’re too arrogant to see our shortcomings and act only in our own interests,
there will be no salvation.
There is a lot to be thankful for to be sure and there are signs aplenty that we’re about to experience truly remarkable leaps forward. Many
good people are contributing to society in fantastic ways and sharing their knowledge for the benefit of others. Businesses of all kinds are represented in these pages with thought leaders who have insights that can help you take your business to the next level.
Please enjoy the read!
BusinessBrief December/January 2014/2015
Nicholas
5PUBLISHER’S NOTE PTHE TEAM
PUBLISHER James Scott [email protected]
EDITOR Nicholas Harland [email protected]
TECHNOLOGY & GADGETS Steven Ambrose [email protected] Tel: 083 601 0333
OFFICE MANAGER/ SUBSCRIPTIONS Jenny Horsman [email protected]
PRINTED BY United Litho (JHB) Tel: (011) 402 0571
ADVERTISING SALES Janine Levy [email protected] James Scott [email protected]
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COVER DESIGN & CONCEPT James Scott Bryan Maron Cover image: Shutterstock
CONTRIBUTORS Please see our list of contributors on page 80
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Editorial contributions are welcome, but the publisher cannot accept responsibility for unsolicited material. The editor reserves the right to alter or cut copy. Copyright: BusinessBrief Publishing (Pty) Ltd. All rights reserved. Requests to lift material should be made to the editor. While every effort has been made by the publisher to ensure the accuracy of the information contained herein, the publisher and its agents cannot be held responsible for any errors, or loss incurred as a result. The publisher advises that readers consult their financial and professional consultants before acting on any information. All material used has been submitted with the understanding that it is original, and the publisher accepts no responsibility for any misrepresentation in this regard. No consideration is accepted for any editorial published. Published articles are not linked to the placement of any advertising.
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BusinessBriefDecember/January 2014/2015
GIVEAWAY
BusinessBrief
6 BRIEFCASE
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Blackberry Passport The all Square Blackberry Passport breaks the chocolate bar mould with the
new Passport. It’s innovative different and very clever. A true productivity demon, with all the security usability and professional credibility that
Blackberry is known for; the new Blackberry Passport has top rate specs an outstanding screen and an innovative physical keyboard that makes mail
on the go a pleasure. The Keyboard also doubles as a full touchpad when needed. If security and productivity are key to your mobility, along with all the apps and two day battery power, the new Blackberry Passport may just
be the smartphone for you.
Available from all the networks.
December/January 2014/2015
The Jawbone ERA Bluetooth headset has been crafted to blend seamlessly into your life and make interacting with
people and smartphones even easier. You’ll no longer have to reach to your pocket while juggling music, deadlines and email at your desk and on the go. Sleek and unobtrusive looking with high quality sound, the Era is an easy to use on the go companion to any smartphone. ERA’s audio interface via the downloadable app helps free up your screen and unlock the full potential of your device.
Avalable across the country; more info at www.jawbone.com
Jawbone ERA
BusinessBrief
7BRIEFCASE
GIVEAWAYS
For a chance to receive
the Verbatim Mediashare
Wireless, or the
NutriBullet, please send
an email or postcard
(one entry per person)
with your name, physical
address and telephone
number marked “Verbatim
Giveaway”, or “NutriBullet
Giveaway”. Please note
that this giveaway is only
open to our South African
readers.
Email:
Postcard: P.O. Box 1546,
Parklands, 2121
Closing date: Friday,
16 January 2015
Congratulations to last
edtion’s entrants:
• Francois de Bruin of
Pretoria – Kershaw Blade
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Northcliff – MyCloud
Mirror
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For more information: www.nutribullet.co.za
GIVEAWAY
December/January 2014/2015
NUTRiBULLET – THE SUPERFOOD NUTRITION EXTRACTOR
Apple have announced their latest tablet the iPad Air 2, refreshed and slimmed down, the new Apple iPad Air is the thinnest and lightest tablet on the market. New screen technology improves the colour and touch sensitivity of the screen along with the latest A8X processor keep the new iPad Air 2 at the forefront of tablet technology.
Available from the iStore FNB and Apple approved dealers countrywide.
Apple iPad Air 2
By Alex Dube
How you cocoon yourself from the ravages of onerous tax obligations while you build your property empire is not a topic that many would dare delve into openly. Alex Dube explains what he calls the NO Tax, Free Money concept and how you can grow your wealth on an ever-expanding spiral of property wealth…Find, Create, Preserve, Grow.
Drawing from over 15 years of property experiences that have consistently yielded great returns for the author, this book imparts detailed and extremely practical advice, as well as tricks of the trade on how to create a property empire from nothing. Zero Investment Equals Zero Return: Seek, Find, Invest and begin your Spiral of Property Wealth.
Available at all good bookstores, Amazon.com, Barnes & Noble, Apple iStores, Kobo, Kalahari and Loot or www.notaxmoremoney.com
By Carl Bates
In business, an avalanche could be a sudden or unexpected business catastrophe that threatens to destroy everything you have created. Or it could be the potential for disaster that you face when trying to reach the next level of success: a step up that perhaps requires more than you can currently give.
Traversing the Avalanche takes you on a journey to understand what it means to practically use the foundations of governance to move through and over the risk of business failure, while maximising the opportunities for reward and growth. Through this book you will develop a deeper understanding of what SME governance entails, how to maximise its benefits and who you will need with you on that journey.
Available from all good bookstores or from [email protected] or [email protected]
By Songezo Zibi
South Africa faces enormous challenges brought about by the legacy of its horrible past and the actions of its present. In the twenty years since the advent of democracy the country has come to believe that the ailments of its soul will be solved by state bureaucratic interventions. While at a material level this may be true, at the core of its failure to confront its demons successfully is a missing moral and philosophical foundation to the future it wants to build.
Raising the Bar provides a fresh, unencumbered analysis of the topics that pervade our daily lives, including race, leadership, politics, government, violence, the position of women and the taboos that haunt us. It explores why we are the people we have become and the future our present state is building. Uncomfortable and littered with vulnerabilities and problems, this is a task we can no longer delay. It is the only way to lay a solid foundation to ensure that we become a prosperous nation.
Available from good bookstores or from www.kalahari.com or www.amazon.com
Traversing the Avalanche
Raising the Bar – Hope & Renewal in South Africa
PAY NO TAX GET MORE MONEY – THE SPIRAL OF PROPERTY WEALTH
BusinessBrief
8 BRIEFCASEDecember/January 2014/2015
BusinessBrief
9BRIEFCASEDecember/January 2014/2015
SPITFIRE RECEPTION DESK Our furniture has been designed with the discerning buyer in mind with every item handmade by skilled artisans, to exacting standards with attention to detail and quality that make each piece a work of art. Our furniture range varies from aviation inspired pieces using aero aluminium, stainless steel and vintage Brazilian leather to timeless pieces such as our Eames lounger and luxurious Chesterfield couches.
Contact Spitfire Furniture: +27 (0)11 447 7699 [email protected] www.spitfirefurniture.co.za
HI-COVE CHAIR BY MOLTENI & CThe innovative elegance of the sixties has been revisited by Ferruccio Laviani with a contemporary slant: two modelled shells are enough to lightly design the seat and backrest of this stunning armchair. With removable fabric or leather upholstery with integrated padding and a revolving base of chrome steel, the Hi-Cove will add style to any office.
Available from M Square Lifestyle Necessities: +27 (0)11 447 0807 www.msquareonline.co.za | [email protected]
FOSCARINI DIESEL FORK LAMP The Fork Lamp is inspired by casual fashion, by campsite tents and by an informal, playful and dynamic lifestyle. The stitching on the fabric has been created like that on jeans and the rings are not merely decorative, but respond to practical needs with simplicity and immediacy. The light inside reveals a patchwork structure and the texture of the canvas, a little like when you turn on a light inside a tent. The lampshade is extremely flexible and can be oriented 360°. The stand of the floor and table versions is also very mobile, thanks to its joints: this means you can change the direction of the light as you please, play with the lamp and have fun continually finding new positions for it.
Available from M Square Lifestyle Necessities: +27 (0)11 447 0807 www.msquareonline.co.za [email protected]
The ESSENCE of refined luxury
Designed by Sir Herbert Baker and originally built in 1908, The Andros Deluxe Boutique
Hotel is conveniently located in the lush, leafy southern suburb of Claremont, Cape Town. The hotel is set in 5 000m² of magnificent mature park-like gardens with breath-taking views of Table Mountain. Accommodation comprises 12 luxuriously appointed deluxe bedrooms and an executive suite with its own private swimming pool.
Our garden swimming pool area provides guests with the perfect space to relax and enjoy the magnificence of the Cape in summer. All bedrooms/suites offer typical 5-star guest comforts such as:
Air-conditioning, underfloor heating, flat screen televisions, 12 television channels, complimentary Wi-Fi, mini bar fridges, tea/coffee making facilities, magnificent en suite bathroom facilities, mini safes, etc.
Our incredibly well stocked champagne bar with adjoining very extensive patio terrace provides guests with a wonderfully comfortable and
relaxing retreat to indeed savour the magnificence of the property and surrounds. Our DINE Restaurant is the proud recipient of a coveted Platinum Star Award for the excellence of cuisine and is open every night from 6pm.
The hotel is 18km from Cape Town International Airport, 10km from the City Centre and the V&A Waterfront and a 15 minute walk to Cavendish Square, a large and prestigious shopping centre. Airport transfers are available by prior arrangement.
Our magnificently appointed Herbert Baker Room conference facility is comfortably equipped with air-conditioning and offers easily accessible cloakrooms and offers fully flexible, adaptable open layouts and is indeed ideally suited for:
• Board Meetings• Conferences• Private Luncheons or Dinners• Presentations• Intimate Weddings• Product Launches
The facility comfortably accommodates up to 28 guests seated in cinema style and smaller numbers in other seating arrangements.
The room is bathed in natural light with the doors of the facility opening onto the beautiful gardens, offering exceptional views of the forested slopes of Table Mountain and the world-renowned Kirstenbosch Gardens.
For reservations or general information please contact Charmaine: [email protected] +27 (0)21 797 9777 n
10 TRAVEL & LEISUREBusinessBrief December/January 2014/2015
77161 BusBief.indd 1 2014/11/13 1:59 PM
Africa is a continent with untapped potential, and this is certainly evident in the African aviation industry. We have seen many local carriers come and go, and
the market is fragmented. This needs to change as soon as possible, with partnerships and alliances being the future of all airlines, whether full service or low cost.
Less than 35% of African countries are currently served by daily flights. This rather alarming statistic speaks to the untapped potential of the continent. Local carriers should make addressing this a matter of urgency. Rather than focusing on what competitors from other markets, such as the Gulf State airlines, are doing, African airlines need to take the lead in unlocking potential and prioritising services to local markets. At the same time, there is great opportunity to be had by taking advantage of Africa’s growing business links with the East.
Establishing routes in this market and focusing on improving services to the lucrative business travel trade are key to further developing the aviation industry in Africa. Of course, the local industry, like any other, is not without its challenges. These include high fuel prices, the global economic downturn, and sporadic unrest in some areas. Of course, the recent Ebola outbreak has also had a major impact on the industry. What sets one airline apart from the next is how these challenges are handled. It is essential that the passenger is always prioritised. Invest in market research, find out what your passengers are looking for. It is vital that channels of communication are established and that your clientele is kept abreast of any developments. The passengers must feel confident that their safety and security come first, or they will quickly lose confidence in that airline. Employee satisfaction is also vital, as satisfied employees lead to satisfied customers, thus ensuring the continued growth of the market. Invest in employee training to make sure the people that represent your brand are empowered to do so to the best of their ability.
While the industry is not without its challenges, there is also great potential for growth, and the future is certainly bright for airlines that are able to take the necessary steps, and work in partnership, to unlock this. n
Unlocking Africa’s aviation
By Mbuvi Ngunze CEOKenya [email protected]
12 TRAVEL & LEISURE
Seeing IS believing
BusinessBrief
There are a handful of places on earth where you have to pinch yourself just to be sure that
what you’re seeing is real. The quaint little fishing village of Paternoster, along the Cape West Coast, is one of these places – and Strandloper Ocean Boutique Hotel proudly honours the ancient indigenous travellers of this coastline, while welcoming modern-day discerning guests inspired by its serenity and surreal natural beauty. Here, heaven meets earth on the shores of the Atlantic. It is not another place, it is another world.
The Strandloper Ocean is a fusion of beach style and contemporary luxury; with organic lines, hues and textures with an overall feeling of simplicity. It is a place of wild beauty and wide white beaches washed by an ocean that’s cool and enigmatic.
Take the time to simply be, or if you are feeling more adventurous, set off on an endless beach walk in search of whales and dolphins, hop onto a bicycle for a leisurely ride of take to the waves
on a kayak. Paternoster is a seafood mecca and the plentiful fruits of the sea remain in vast quantities of fresh fish, huge black mussels and the authentic West Coast crayfish, caught by local fishermen.
Here you can completely leave the world behind. Strandloper is a retreat, a place of calm that is completely private and secluded. It is so much more than a hotel; Strandloper is a philosophy
of being in harmony with nature and blending in with the delicate beauty of the surroundings. Interiors are silent so they do not compete with what is outside, but instead showcase the natural splendour of this unique coastline.
To book, contact: +27 (0)21 794 5858 [email protected] www.strandloperocean.com n
December/January 2014/2015
New York LoNdoN TokYo
As The Peech Boutique Hotel celebrates its 10th birthday, the establishment sees a renewed
emphasis on eco-driven luxury. Visitors to The Peech know that they’ll find a chic home from home here. Originally a private residence, the small intimate hotel has evolved into a remarkable 16-room venue set in a magnificent and lush garden.
For a bit of time out, guests can stroll around the 1-acre garden, relax by the outside swimming pool or grab a tome from the library. For the more actively inclined, The Peech has an arrangement for visitors to access the Planet Fitness gym next door at a small charge. In-house guests can enjoy delectable bistro fare for breakfast, lunch and dinner, with much of the fresh herbs and vegetables sourced from the hotel’s own kitchen garden. The focus is on flavour and seasonality and the setting overlooking the garden is simply magic. For more intimate meals, there is a private dining room, while the walk-in wine cellar is a must-visit for oenophiles.
Perfectly located in bustling Melrose, The Peech is 10 minutes from business hub Sandton and five minutes from hip Melrose Arch and Rosebank where the nearest Gautrain station is located, making it easily accessible whether
guests are visiting for work or play. The Peech is also a perfect venue for a small conference or business breakaway with a boardroom and green room available for private strategy sessions.
Responsible and eco-friendly tourism is at the heart of The Peech Boutique Hotel. Recent years have seen the addition of solar water heating, extensive recycling practices, use of only recyclable batteries in appliances as well as use of grey water recycling to assist in keeping the gardens lush. Water is bottled on site and rooms have double insulation too. This eco-awareness means the hotel’s footprint
is kept to a minimum with as small as possible impact on the environment. In addition The Peech is a Fair Trade Tourism certified hotel, thereby acknowledging its ethical approach not only to the environment but to its employees, many of whom have been working there since its opening 10 years ago, too. The Peech also supports Little Eden children’s charity as well as Pack for a Purpose.
For reservations and more information contact: +27 (0)11 537 9797 [email protected] www.thepeech.co.za n
A PEACHY HHHHH
13TRAVEL & LEISUREBusinessBriefDecember/January 2014/2015
BusinessBrief
14 VIEWPOINT
In these eras, the rules for success and failure change as the very structures of societies and cultures change. Politics and
economics are shifted. Entire industries rise and fall, and fortunes are made and lost. And in historical terms, it all happens in the blink of an eye: normally taking just two generations, or about forty years.
History-Defining, Disruptive ChangeWe are living through one of these history-defining eras right now. The rules for success and failure in our industries are being rewritten. The orthodoxies (the set of norms, standards and generally accepted approaches to “how things are done around here”) that govern our lives are being upended. We are not just experiencing a bit of turbulence. Life as we know it is being disrupted. Permanently. Irreversibly. Deeply.
Allow me just three exhibits to prove this point – three proofs that we’re living in an unprecedented time of historical change where life as we know it is being disrupted.
Proof #1: Life ExpectancyMy father’s mother was born in February 1914, and her life expectancy at birth was 47.
She has lived to see her 100th birthday. In fact, over 350,000 people are currently older than 100 – a number rising exponentially every year. My oldest daughter was born in 1999, and I wonder if she has the potential to more than double her life expectancy of 87? I think so.
We can currently replace every body part, except the brain. And medical technology may soon assist us to transfer our consciousness
to machines, or at very least augment our own. We have to all plan to live for more than a
century.
Proof #2: Abundant energyThe opening up of shale gas fields
around the world is changing the global energy map. The USA became the world’s leading oil and gas producer in late 2014, and by 2020 will not only be energy independent but also exporting. This is a game changer, both in terms of
the price of energy (which will continue to fall) and global geopolitics.
Add to that the work of ITER, a multinational engineering project in the South of France, building one of the largest man-made
machines ever. When complete in 2027, it will
use fusion technology to fire up atomic plasma that
generates more energy than is used to power it.
Limitless, cheap energy is nearly here.
There’s nothing new about change. Our world is constantly changing. But there are moments in history when all the forces of change combine together to create an era-defining period- eras like the Enlightenment, the Renaissance, the Reformation or the Industrial Revolution.
You cannot use today’s thinking for tomorrow!
OUR DISRUPTIVE ERA!
December/January 2014/2015
The leap isn’t as scary when you’re working with the right peopleLeaders in engineeringconsulting
+27 11 519 [email protected] | www.gibb.co.za
GIBB is a Level 2 BBBEE contributor
ENGINEERING & ARCHITECTURE
GIBB ad_A5_Corp 24.04.14.indd 1 2014/05/29 2:40 PM
Proof #3: Smart devices for everyoneThe “Internet of Things” is connecting everyone and everything together, and smart devices in our hands give us control of this smart world. And when you start selling these devices for less than $50 and provide free wifi, as is happening right now in many emerging markets, you have a game changer.
What’s To Be Done?At least three responses are urgently required from every business leader everywhere:
1. Spend more time on the “balcony”. Too many people are stuck on the “dance floor” of their businesses. Spend more time working ON your
business rather than merely IN your business.
2. Experiment more and create disruption. Don’t wait for your industry’s iTunes or Uber to change the routes to market and the rules of the game. Have big and small experiments on the go all the time, and be prepared to try and fail, and learn and try again.
3. Unlearn and relearn. The way it’s always been done isn’t the way it always has to be done. Question your orthodoxies continually. Listen to new voices, and encourage especially the younger generation to see your industry with new eyes.
As management guru, Peter Drucker once said, “In times of turbulence, the greatest danger is not the turbulence itself. Rather, it is facing tomorrow’s world using yesterday’s logic”. However much you think the world is about to change, you’re probably under-estimating. And that means the future is going to be more scary – and more exciting – than you can possibly imagine. Only the most adaptable are going to survive. n
By Graeme CodringtonFuturist, Researcher & Keynote Presenter [email protected]
@futuristgraeme
15VIEWPOINTBusinessBriefDecember/January 2014/2015
The leap isn’t as scary when you’re working with the right peopleLeaders in engineeringconsulting
+27 11 519 [email protected] | www.gibb.co.za
GIBB is a Level 2 BBBEE contributor
ENGINEERING & ARCHITECTURE
GIBB ad_A5_Corp 24.04.14.indd 1 2014/05/29 2:40 PM
BusinessBrief
16 VIEWPOINT
The internet has enabled new business models that have disrupted and even destroyed incumbent models. From
travel agencies to video rental stores, the ability to go online has transformed industries, resulting in higher productivity, greater consumer choice, and lower prices. These industries have one thing in common: they provide information-based services. It should come as no surprise then that the South African Postal Service (SAPS) is facing massive challenges. For, like many other industries whose business models made sense in an analogue, paper-based era, SAPS’s business model makes much less sense in today’s digital era and, as such, is in need of fundamental reform.
Couple this with an almost three month post office strike by the South African Postal Service (SAPS) – one of five since 2011 - and the situation is looking very dire indeed. Given the lack of outcry from SAPS’s customers, it must mean that they are finding alternatives to snail mail and going online.
Snail mail frequently gets lost, torn, bent and delivered late – this does not happen with electronic communications. On the other side of the coin, the time wasted to get statements and invoices delivered often impacts a company’s ability to collect its revenue. Given this landscape, electronic distribution delivery companies must be smiling.
What is electronic distribution delivery?Electronic document delivery refers to the management and punctual distribution of a company’s service statements, customer invoices and associated collection letters, payslips, contracts and policies, while providing an easy electronic payment solution for customers. Its automation of such tasks, along with ability to reduce costs and increase document security, means that electronic document distribution poses a significant threat to the postal service.
Businesses all over the world are converting to
electronic document delivery as their primary means of sending documents. Getting vital financial documents out to customers quickly, and payments in just as quickly, is critical to business survival. When a company is awaiting an invoice payment, they are losing money in the form of interest. Therefore, the faster that money can be obtained, the more efficient that company will be. Often the time and cost to process the data for print or to send these documents is too high. The development of simple business invoicing and document management solutions means that the task of using electronic document delivery is easier than ever before.
How does electronic distribution delivery work?The system of electronic document delivery works by automating the sending of customer statements and invoices, by interacting with a customer information database. This database lets the electronic document delivery system know when to send a document, and allows it to use mail merging technology to create that document. With intelligent archiving and document linking, quick access to customer records for real time response to customer queries is easily achieved.
Given the important role the post office plays in today’s society, it will exist well beyond its economic viability; but (and it’s a big but) at some point in our future, the trends all seem to point to the inevitable disappearance of mail.
Given the ease and speed of electronic delivery and payments, plus the obvious environmental incentives of going paperless, the future for the world’s post offices does not look rosy. n
Postal service REDUNDANT? There’s no
question that post offices, the world over, are struggling. And
quite simply, the reason for this is the internet.
As more people move on-line, standard mail volumes drop.
Every electronic bill, online
payment or e-mail puts
another nail in the standard
letter’s coffin. And this trend will accelerate,
not decline.
By Gavin [email protected]
December/January 2014/2015
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Research into the qualifications and diversity of directors, CEOs and CFOs of JSE-listed companies was conducted by the South African Institute of
Chartered Accountants (SAICA) earlier this year – for the first time encompassing all 475 companies listed on the JSE, rather than the Top 200 companies (by market capitalisation) surveyed in previous years. Although this broadening of the sample base means that no meaningful comparisons between this and previous years’ results can be made, this year’s data on its own reveals a trend in racial and gender transformation that should boost optimism and business confidence.
SAICA surveyed all the companies listed on the JSE; there were 4 035
directorships in all, of which 1 025 – 23.8%– are held by Chartered Accountants South Africa [CAs(SA)]. That’s almost a quarter of the total; the CA(SA) is the most predominant
business qualification represented. When we look at CFOs or financial
directors, CAs(SA) constitute 74.3% – and 21% of CEOs or managing directors
are CAs(SA). Almost two-thirds of the companies run by CAs(SA) are in fact in the Top 200, which implies that CAs(SA) are better than average at running companies.
75% of directorships are still held by whites at present, and 87% by males – so obviously a lot of work
still has to be done on transformation. But if
you look at gender and race together, it
can be noted that 71% of these
directorships are held
by white
males compared to 5% by white females – while 17% are held by black males versus 8% by black females, which are a lot closer. Clearly the gender gap is closing amongst black directors. And while on average CAs(SA) make up 23.8%of the directors, there is a higher percentage of CAs(SA) among female directors (28%) than among males (22%). This is evidence that SAICA’s commitment to gender transformation of the profession, which was rolled out ten years ago, is beginning to bear fruit. We actually produce slightly more female than male CAs(SA) every year already. We’ve broken the back of the gender transformation issue at that level; it’s just a matter of time before these numbers reflect at the directorship, CFO and CEO levels.
Racial and gender inclusivity may be “better” when considering the percentage of younger directors, but it is nowhere near a reflection of the actual make-up of our population yet. But the indications are encouraging, and with the continued support of business and government, we can successfully transform the CA(SA) profession – and the JSE. There’s no point in discarding skills that people have spent 30 or 40 years mastering – purely because those people are white and male – until you have successors with the experience to replace them. As the growing number of black and/or female CAs(SA) mature, we expect to see the racial and gender mix of older directors – and CEOs and CFOs – change to reflect the country’s true demographics. It’s clear the CA(SA) profession is having an effect, and that we need to continue our efforts to create more black and female business leaders. n
UNSEATING the PALE MALE!A survey of all 475 JSE-listed companies has revealed that South African company directors, CEOs and CFOs are still predominantly white and male – but indicates hopeful signs of transformation within the younger generation. Specifically, this is as a result of young black CAs(SA) being appointed as directors below the age of 40
By Dr Terence NombembeCEO [email protected]
@saica_ca_sa
”There’s no point in discarding skills that people have spent 30 or 40 years mastering
– purely because those people are white and male”
BusinessBrief
EDUCATION & TRAININGMANAGEMENT18
December/January 2014/2015
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Joseph Campbell was a philosopher who studied stories across different cultures. He discovered that there was one universal theme underlying all great
stories – “the hero’s journey”.
The hero’s journey offers a map to transformation leaders. Organisational transformation has the same storyline as the hero’s journey. It is an adventure and a quest.
The journey starts with a potential hero who lives in a familiar world. He becomes aware of a “call to adventure”. There is a growing sense that change is required. The hero has to step out of the “run of the mill world” on a quest. Stories often start with an unwilling hero. The hero tries to refuse the call to adventure. Usually the call becomes more intense. In organisations the call to adventure may be the increasingly competitive landscape or the poor results on the climate survey.
There is a point when the hero can no longer refuse and he departs into the unknown. Change leaders at some point take a decision to start the journey because they hear the call to action, and have the courage to timeously respond. In stories we find monsters and dragons that the hero needs to slay. Slaying dragons is about facing fears and limitations. In all stories struggle is a given, but also splendour.
In the context of business transformation, the hero’s journey takes place on various levels.
The leader’s personal journeyExternal change requires inner change. The heroes in stories undertakes a quest to achieve something in the external world, but this result is typically dependent on a parallel process of character transformation. If leaders do not change, the organisation will not change.
The leadership team journeyOrganisation transformation is a complex endeavour that
LEADING organisational changeBy Marlene de LangeDirector Grow [email protected]
@TrainingRoomZA
does not need the dynamic of leaders pulling in different directions. Leadership teams need to slay dragons relating to politics, mistrust and silo functioning.
The organisational journeyThe third journey is the most complex – leading the organisation into the forest to change individual and collective behaviour. Often the people are very comfortable in their own space of “run of the mill” disengaged functioning. The leader needs to paint a simple vision which is convincing enough so people will be prepared to take up the call to adventure. Leaders also need to play a key role as story-tellers. They reframe set-backs as temporary challenges and discomfort as growth. They engage and involve their people as they know that negotiating the dragons will take collective wisdom and responsibility.
The frame of the hero’s journey helps us to reinterpret the difficulties of change as essential ingredients rather than distractions. It reminds us that transformation cannot be managed by executing a recipe.
After the journey, the hero returns to normal life, but as a changed person. The hero will now use the new abilities to serve the community in a more profound manner.
Campbell says “We’re not on our journey to save the world but to save ourselves. But in doing that you save the world. While we undertake corporate transformation to “save the world”, it offers an opportunity to every leader for personal transformation. n
19MANAGEMENT BusinessBriefDecember/January 2014/2015
Traditional offices OUTDATED...The traditional “nine to five”
office environment could soon become outdated and be a thing
of the past in many organisations, according to a report issued by PwC. PwC’s The future of work: A journey to 2022 report, shows that only a minority of workers want to work in a traditional office environment in the future. One in five people say they want to work in a “virtual” place where they can log on from any location or use collaborative work spaces.
The report discloses a number of projections for what the future of work might look like based on a survey of 10 000 workers and 500 HR professionals globally. Professional staff’s desire to break free from the traditional office environment suggests that the way they may work in the future could change significantly and organisations need to prepare themselves for this shift.
It is clear from the research that traditional nine to five office working could soon become resigned to history for many workers. People feel strongly that they no longer want to work within the constraints of the typical office environment and advances in technology mean that workers no longer have to be
shackled to their desks.
We predict that many organisations will embrace these changes and use them to their own advantage. We can see the rise of organisations that have a core team that embodies the philosophy and values of the company, but the remainder of the workforce is not fixed and come in and out on a project-by-project basis. These companies will make extensive use of technology to run their business, coordinate a largely external workforce and support their relationships with third parties.
Staff are also more likely to see themselves as a member of a particular skill or professional network, rather than as an employee of a specific company. People will be categorised and rewarded according to their specialist expertise, which will create increased demand for people to have a personal stake in the organisation’s or project’s success. Options such as project-related bonuses are therefore going to become more common.
The report points out that a key challenge is ensuring that the people being hired really do possess the expertise required or claimed.
This will demand a combination of effective verification and watertight contractual agreements, possibly with penalties for poor and non-delivery. It is going to require a high degree of relationship building and business trust. Many contractors and partners will adopt “eBay-style” rating of past performance to assist in landing the next contract.
Tremendous forces are significantly reshaping the world of work. Economic shifts are redistributing power, wealth, competition and opportunity around the globe. Disruptive innovations, radical thinking, new business models and resource scarcity are affecting every sector.
Business across the world are beginning to understand that they need a clear and meaningful purpose, and mandate for the decade ahead if they are to attract and retain employees, customers and partners. n
By Gerald SeegersHead of Human Resources for Southern [email protected]
@pwc_za
BusinessBrief
EDUCATION & TRAININGMANAGEMENT20
December/January 2014/2015
Leaders tend to focus on obvious issues and often fail to account for the underlying ones that
cause irreparable damage. Strategy sits above the waterline, everyone in an organisation is aware of it, however it is what lurks beneath the waterline that should be concerning management.
An organisation’s capacity to perform is a function of individual human behaviour and it is the invisible challenges related to this that need to be addressed. Strategy, integrated processes and operating models are clearly defined and leaders tend to spend significant time over communicating these elements and implementing scorecards to ensure adherence. It is not wrong to focus on visible perils but it is important that an equal amount of time is taken to focus on the elements that aren’t. What can leaders do to address the
organisation’s culture and the elements below the waterline?
1. Scan below the surface – Capture the current employee experience. Collect stories from employees at all levels on incidents where things have gone wrong, as well as have senior leaders conduct structured interviews with a spectrum of employees to gain insights as to what is happening on the shop floor. This yields rich data and exposes leaders to the often unseen challenges faced by employees.
2. Search for vital behaviours – Identify a few vital behaviours that can have the most impact on these challenges. Identifying the right vital behaviours will stop self-defeating and escalating behaviours and instead start a chain reaction that leads to good results.
3. Design a powerful influence strategy – The right influence strategy can demonstrate meaningful results in as soon as three to six months.
The challenge that is often avoided by leaders is to strategically and systematically influence the behaviour of employees. Behavioural challenges can hinder an organisation’s progress, yet many leaders do not focus on this as they lack the visibility of looming behavioural threats and the skills to respond quickly and effectively. Leaders need to scan below the surface, assess threats to the company’s internal capacity and develop strategies to build confident, engaged employees. n
DANGER beneath the waterline!21MANAGEMENT
BusinessBriefDecember/January 2014/2015
By Helene VermaakDirectorThe Human [email protected]
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