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Opportunity Issue 99

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Opportunity magazine is a niche business-to-business publication that explores various investment opportunities within Southern Africa’s economic sectors and looks to provide its readers with first-hand knowledge about South African business. Opportunity also looks to present South African business to international markets that may have interests in investing in South Africa. The publication is endorsed by the South African Chamber of Commerce and Industry (SACCI).

ENTERPRISE AND SUPPLIER

ENTERPRISE AND SUPPLIER DEVELOPMENT What to avoid How does one get Enterprise and Supplier Development right? Initially, let’s look at what companies should avoid. Firstly, companies should avoid doing Enterprise and Supplier Development as a boxticking exercise. There's no tangible impact that is derived from this type of attitude. Secondly, companies should avoid bringing just any SME onto their ESD programme because they need to find a black-owned company. Companies should do due diligence, ensure that they promote the right SMEs: small companies that can be developed through enterprise development, and ultimately end up becoming their suppliers. It is advisable to find SMEs that are within the value chain of the bigger or sponsoring company, or at least within the same industry or sector. Thirdly, avoid having ESD as part of the bigger transformation portfolio within a big company. Rather, dedicate a resourceful person who is responsible for Enterprise and Supplier Development. Ideally, someone who has experienced running their own business. Some ESD managers have never run a business in their lives and yet they are responsible for developing small businesses. Companies should also avoid just giving money to these SMEs without keeping them accountable. If a company plans on giving grants and loans to SMEs, it should ensure that the SMEs are accountable for the monies they have received. Lastly, avoid rolling out ESD without having a proper plan, strategy and clear, tangible outcomes. Each company needs to be clear what it is that they are trying to achieve through ESD. How to do ESD well Conversely, what should companies be doing? Firstly, understand the difference between enterprise development and supplier development. Enterprise development is giving support to blackowned or empowered SMEs to enable them to grow and thrive. These companies can be in any sector and offer an array of goods and services. Supplier development is focusing on SMEs that are already part of a supplier database or SMEs that can potentially supply goods and services to larger entities. Secondly, ensure that there is a dedicated ESD resource within the company, someone who has been an entrepreneur or has experience in running a business so that they are in a better position to understand what SMEs are going through and in a better position to advise and build these SMEs. Thirdly, have an ESD strategy and plan in place with tangible outcomes. The ESD strategy should be aligned to the overall company strategy. Part of the outcomes should be enterprise development beneficiaries becoming suppliers to the bigger business. Companies can earn bonus points for moving companies from enterprise development to suppliers. Brewing success There are examples of companies like Nestlé, who have incorporated Enterprise and Supplier Development as part of their bigger Shared Value strategy. Nestlé supports coffee farmers who become part of their supply chain. As these farmers grow and develop, Nestlé can have a sustainable supply of coffee beans at a quality level acceptable to their business. This becomes a win/win situation for everyone involved. Be sure to include black suppliers in the core services of your business. We find that in terms of procurement, the core services still go to whiteowned companies. Companies that cannot find a black supplier that offers their core services should rather develop them. For example, if IT infrastructure is key to a company’s offering, find a small black-owned IT company that can be grown and developed over the years. Over time, the company can give pieces of work or modules to the SME that they can be responsible for. Ensure that SMEs that come into a company’s ESD programme commit to it. The agreements or contracts that they sign upfront, acknowledging the support that the company is giving them, should be more than a compliance tool to prove that the support was given. There should be commitment binding the beneficiaries to the programme. Lastly, share the success stories from the ESD programme with internal and external stakeholders. Share those stories in annual reports for listed companies or newsletters. Companies should share these stories with their staff, so that they know that the company is making a difference in the SME environment in South Africa. This is by no means an exhaustive list but a few important considerations for a successful implementation of ESD by any company. Enterprise and Supplier Development will continue being a tool that fosters entrepreneurship and growth for SMEs in South Africa. As blackowned SMEs grow and thrive, they will eventually be able to create jobs. This will improve the economic prospects for South Africa. About Mint Fresh Advisory Services Thuli Magubane founded Mint Fresh Advisory Services in 2010 and has facilitated its growth into a 100% black women-owned management consulting firm that helps prepare SMMEs to become suppliers and assists larger companies in running ESD programmes. The company’s innovation workshops are proving popular and clients include Nedbank, Standard Bank, South32 and Sasol. Thuli has degrees and diplomas from UCT and Wits Business School and completed a Master’s Programme in Leadership in Spain. Website: www.mintfreshas.co.za 52 | www.opportunityonline.co.za

PPC – bridging the skills gap, one brick at a time Iconic cement producer expands its skills development programmes. Bricks and cement are basic requirements for any building project. They are also the unsung products that have opened opportunities for thousands of people, created employment, enabled entrepreneurs to create small businesses, earn a living and employ and upskill other people. “The fact is,” says Njombo Lekula, Managing Director of PPC Southern Africa, “that bricklayers are always in demand. Whether the call is for someone to build a garden wall, braai area, do repairs or tackle a larger project, anyone who has skills, transport, some tools and a dash of determination can earn a living. “That is why PPC introduced South Africa’s first bricklaying course for ‘bakkie builders’ – that intrepid breed of informal builders who are usually the first people called upon when something needs doing. “Until this year, however, many of these self-starters did not have the necessary knowledge about cement selection, creating mixes and the techniques needed to ensure that their projects would be totally fit for purpose. Often, the results have been mixed as far as quality was concerned. “As South Africa’s largest cement producer, we felt we should be helping create a new generation of bakkie builders; people with the knowledge and ability to deliver quality building projects.” A launching pad The result of PPC’s determination to make a difference has been the twoweek course in bricklaying which has the potential to change futures and provide a launching pad into the world of construction. It has not just been people hoping to break out of poverty who are lining up to be trained. The course has also attracted unemployed young engineering and construction graduates looking for some practical experience to help kick-start their careers. Thirteen students from Gauteng have already attended a course at the PPC Cement factory in Pretoria West. Within eight months, it is intended that more than 200 bakkie builders will be given a chance to improve their abilities. “PPC understands that many attending the course will not have the funds to buy the tools necessary for bricklaying services after the course. In addition to the course, we are, therefore, assisting participants to buy the basic tools they require to start a bricklaying business,” says Lekula. To ensure that access to the course is as easy as possible, PPC has partnered with private FET college Motheo Academy, an active participant in the built environment, to provide the training. People wishing to enrol in a course, which is offered free of charge, can either apply to join a course, or be nominated by a retailer or supplier. Other courses that cover the theory and practice of bricklaying, plastering and construction management will soon be available across the country as PPC expands its efforts to promote skills development in the construction industry. Programmes will include a 10-day plastering course covering wall plastering and screeding of floors. A five-day management programme will include construction team management, health and safety and the use and storage of construction materials. All attendees completing the NQF level 3 (bricklaying and plastering) and NQF level 4 (construction management) programme will receive South African Qualifications Authority certificates. “We believe that by helping create interest in construction at an informal, grassroots level and further up the formal building chain we will be encouraging more young people to consider construction as a career path. “PPC is a proudly South African company. As such we are committed to helping foster a vibrant construction industry so that the nation can reach its development goals. Ensuring this outcome can only be achieved by building the construction industry itself,” says Lekula. About PPC Ltd PPC is an iconic material and solutions provider of quality and consistent cement, aggregates, metallurgical-grade lime, burnt dolomite, limestone, ready-mix and fly ash. We also provide technical support to our customers. PPC’s story stretches back over 129 years to where we were first incorporated on the outskirts of Pretoria in 1892. As the first cement plant in South Africa, we have established ourselves as a resilient organisation by adapting to ever-changing economic, operating and political environments. This Sub-Saharan brand continues to grow beyond South African borders into Botswana, Zimbabwe, Democratic Republic of Congo and Rwanda where our footmark extends. We are proud to be a leading provider of quality building materials and solutions to empower people to experience a better quality of life. Follow PPC on LinkedIn www.linkedin.com/company/ppc-africa, PPC Africa Twitter @PPC_Africa, like us on www.facebook.com/PPCAfricaLtd and visit us at www.ppc.africa

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