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The Journal of African Business Issue 7

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Welcome to The Journal of African Business, a unique guide to business and investment in Africa. Since the inaugural issue was published as an annual in 2020, the quarterly format has been adopted, giving our team more opportunities to bring to readers up-to-date information and opinions and offer our clients increased exposure at specific times of the year. We cover a broad range of topics, ranging from energy and mining to tourism and skills development. A wide-ranging interview in this issue with a visionary entrepreneur gives a welcome insight into how the private sector can be deployed to solve issues that go to the heart of social problems, in this instance, affordable housing. Related to urban development is the article that lays out the vision of one of the continent’s great cities to create a smarter city. Special Economic Zones have been in Africa since 1970 but there has been a great deal of new thinking about the role that these zones can play in bolstering economic growth and promoting exports. An article explores the chief motivations for the growth of this particular policy intervention and notes that more zones and organisations representing these zones are aiming to work together, not only on a continental level but through the United Nations as well. Executive education can boost the earnings of graduates of Master of Business Administration courses, but can those post-graduate programmes also respond to and equip students with the tools to tackle African challenges? The importance of being properly covered by insurance for extreme weather conditions is the subject of two case studies by the African Risk Capacity Limited, a financial affiliate of the African Risk Capacity Group, a specialised agency of the African Union. And much more... Global African Network is a proudly African company which has been producing region-specific business and investment guides since 2004.


THE SOUTH AFRICAN MBA: A MAGNET FOR AFRICAN STUDENTS The financial return on investment is significant, but it’s the resilience and complex problem-solving skills of South Africa’s MBA graduates that provide the edge globally. The relevance to the African context of teaching and case studies is key. This article was originally published on When times are tough, like they are right now, it may seem prudent to reduce spending while waiting for the economic turbulence to blow over. Yet, embarking on a Master of Business Administration (MBA) now ‒ because of the dire situation and uncertainty, not despite it ‒ could be one of the smartest career moves a student will ever make. The MBA journey teaches a heightened sense of political and economic awareness, on top of the technical and critical thinking skills and personal growth that will take students to the next level. For many, the programme provides valuable support systems and networks, while helping each participant to define what kind of future they want to create, and the courage to get started on it. The full return on investment (ROI) of an MBA usually takes a few years to unfold. But for the vast majority it does happen, as studies show. The Graduate Management Admission Council (GMAC) surveyed business school alumni who graduated between 2010 and 2021 on the value of their degree. Nine out of 10 rated their MBA or Master’s as good, outstanding or excellent value. Two-thirds reported they had advanced at least one job level after completing the qualification. Meanwhile, the “Financial Times 2023 MBA Index” revealed that within three years of graduating, salaries of MBAs more than doubled. LOCALLY RELEVANT, GLOBALLY COMPETITIVE MBA students in South Africa are faced with more uncertainty and complexity than those in Europe, the UK and the US. Burning societal issues such as the inequality gap, youth unemployment and the aftermath of state capture present challenges of which wealthy nations have little experience. The GIBS MBA offered by the University of Pretoria’s Gordon Institute of Business Science (GIBS) aims to equip students with the knowledge and skills needed to address global challenges at a local level. Therefore, the curriculum increasingly integrates a focus on the Sustainable Development Goals (SDG) and other aspects of sustainability. “We teach experiences, case studies and material that is relevant in our context, in South Africa and Africa,” says GIBS Dean, Professor Morris Mthombeni. “We don’t just copy and paste formulas and apply them blindly. Our students learn in the classroom and outside, when we take them into communities, into businesses and into society.” He explains that every MBA student has to complete a year-long project relating to one SDG, doing practical work with companies and NGOs. In addition, the school champions anti-corruption in society, and has become a convening space for students to interact with whistle-blowers, NGOs, business and government officials that are pushing back on corruption. Real-life learning opportunities like these teach resilience, long-term thinking and societal impact, which are attributes that business leaders need to responsibly steer South Africa and the continent towards a more sustainable future. While the MBA journey is intense, robust and will push and challenge you, those who find a business school with the right fit are likely to reap a disproportionate ROI ‒ for themselves, their organisation and broader society. COST-BENEFIT ANALYSIS “I am perturbed when I hear anyone claiming the MBA is expensive in South Africa,” says Professor Mthombeni. For one, he says, many people don’t realise that most local business schools provide two degrees for the price of one: a postgraduate diploma after the first year, which takes students to National Qualifications Framework (NQF) Level 8, and the MBA degree itself after the second year at NQF 9. Secondly, there is the global context, in which South Africa’s internationally accredited business schools can hold their own among Ivy League schools. This is proven by the fact that all 22 registered members of the SA Business School Association are in the top 500 of the world’s 16 000 business schools. Three of them, including GIBS, are triple crown accredited, by the US Association to Advance Collegiate Schools of Business (AACSB), the UK Association of MBAs (AMBA) and the European Foundation for Management Development Quality Improvement System (Equis). They rank in the top 150, which is the best 1%, of business schools in the world. “Our MBA fees are equivalent to business schools that are ranked 15 000th, far below what those in the top 150 charge,” says the GIBS Dean. “So, from a cost-benefit analysis, a South African business school education presents incredible financial value over some of the more developed parts of the world.” The Graduate School of Business of the University of Cape Town regularly wins high positions within international rankings. 18

EXECUTIVE EDUCATION “Sculpting global leaders” is the tagline of the Wits Business School at the University of Witwatersrand. EMERGING MARKET VALUE MBA courses in South Africa involve learning at a different cognitive level than their counterparts in Europe, the UK and the US, adds Mthombeni. “Typically, MBA classes in the Global South feature people with five to 10 years of experience, if not more, while in the Global North, students tend to start their MBA at earlier stages of their career, having had only a couple of years’ work experience,” he says. “The value of the MBA in the Global North lies in helping people advance, for example, from supervisory level to first-line management level. In South Africa, the MBA teaches critical thinking, solving complexity and dealing in uncertainty at system level, with the aim to produce managers and leaders able to navigate our daily reality at a general management level.” This is reflected in the qualification level. According to South Africa’s National Qualification Framework, the majority of American and European MBAs would be equivalent to an Honours degree (NQF 8), whereas the South African ones are at Master’s level (NQF 9). GENERATING VALUE FOR EMPLOYERS Leading companies frequently offer MBA sponsorship as career development or to retain high-performing employees who will continue working while they study. At GIBS, where more than 60% of MBAs are employer-sponsored, students are challenged to generate ROI for their employers while still studying. Mthombeni says he tells his students, “Take what you learn in class and implement it in your organisations immediately. “By the end of the course, you have paid back your tuition fees in hours spent consulting and in creating more sustainable value for your employer.” Many students take up this challenge and achieve ROI by implementing successful consulting initiatives in their organisation. Another important factor relates to value through personal growth. Graduates often talk about their MBA journey as a life-changing experience that sharpened their reasoning skills and critical thinking processes. Studying and networking with people from diverse backgrounds changes individual perspectives and widens horizons. Nearly everybody mentions increased confidence and self-awareness, which is also something that employers noted in the 2020 AMBA International MBA survey. Participating employers were asked what differences they noticed in working with people before and after they completed their MBA. “Common themes that emerged included enhanced analytical skills; enhanced strategic skills; greater confidence; growth in communication and presentation skills; better problem solving; a holistic view of business; enhanced critical thinking; greater focus on the task ahead; better decisionmaking; a global mindset; improved financial acumen (and a tendency to demand a higher salary); and agility and flexibility,” says the AMBA report. It concluded that the surveyed employers were “overwhelmingly positive about the value of an MBA from a reputable business school when looking for senior managers”. 19

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