South Africa’s business mindset needs a hard reboot; one that replaces blame with a proactive approach to growth.
This according to Dr Adrian Saville, Professor of Economics, Finance and Strategy at the Gordon Institute of Business Science (GIBS), where he is the Founding Director of the Centre for African Management and Markets.
Saville, who is also an investment specialist, told guests at a High Street Auctions networking brunch in Johannesburg that contrary to popular opinion, South Africa is not a failed state – but it is severely strained and fragile.
“If you hope the country is going to show fast economic growth, you join the fantasy world proposed by policy makers. The hand we’ve been dealt also includes a slowing global economy and stubborn inflation that no amount of finger-pointing will fix.”
“Our business fix lies in positioning companies for anaemic economic conditions coupled with a mindset that says ‘these are the circumstances, but I’m going to be effective, functional and proactive in pursuing opportunities to grow’.”
Saville says gearing companies for growth starts with implementing a trinity of structural business elements.
“Agility, absorption and corporate citizenry increasingly define business success. Business agility is often confused with speed, but it could just as easily apply to slowing down. The important thing is to have a business structure geared to invention and reinvention as circumstances dictate.”
“Absorption as a structural business element is equally misconstrued in corporate circles. The ability to learn and incorporate new information that anticipates future trends is only one piece of the strategic puzzle.
“The big picture is the ability to withstand difficult circumstances. You must roll with the punches, and have the capacity to come off the ropes in better form than you went onto them. One way of achieving this is changing a top-down leadership structure to one that draws wisdom from the coalface, and using input and information from all parts of the firm to inform strategy.”
“Agile absorbers are quite content to watch from the side-lines while others are jostling. Typically, they don’t follow the herd; doing things like consolidating resources when others are pushing expansion.”
Saville says corporate citizenry completes the trinity.
“The world is evolving; we’re more educated and cognisant than ever before about social responsibility and global issues such as climate change. Brand loyalty will increasingly trend towards businesses which recognise that company and community are inextricably intertwined.
“If you’re not solving a problem that makes your community better, chances are good that the product or service you provide will lack longevity and, by definition, impact is missing or even damaging.”
Saville says the take-away from that for the country’s investors is that if functional businesses become agile absorbers which recognise the link between company and community, then South Africa is a place of incredible opportunity.
“Our economy can be salvaged, but it’ll require concerted effort and teamwork. No country anywhere has ever achieved prosperity with government and business operating independently. Every single nation that has transitioned, owes successful transformation to public-private partnerships.”
“We need to figure out how to work together and do it quickly.”
Saville cautions, however, that the private sector’s commitment to national solutions will most likely depend on the clarity and consistency with which government policy is implemented, reinforcing the principle of coherent partnership and collaboration.
