Why nuclear will remain part of SA’s energy mix

Recent comments by some energy experts about nuclear energy being too costly, and that South Africa does not even need it, cannot go unchallenged.

Credit: SUPPLIED

Matshela Koko is the group executive for generation at Eskom. Picture: Supplied

To understand the reasons for or against nuclear energy, perhaps we should first establish on what basis should a decision for or against such a move be made? Is it based on demand forecast, environmental concerns or just capital cost? Which seems to be the main focal point being proposed for abandoning the option of nuclear in South Africa?

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Had this been the case in 2010, when the first Integrated Resource Plan (IRP) for electricity supply in South Africa was developed, we would have had a least-cost and unconstrained power plan.

However, this would have resulted in building only coal-fired power stations for base-load and gas/liquid fuel turbines and pumped storage for peaking capacity. Therefore neither renewables nor nuclear would have featured as options.

As a consequence, the highly successful Renewable Energy Independent Power Producer Programme (IPP) would have been a non-starter. Important to note that when plans for the IPP were announced, there was significant public debate on the necessity of the programme and “experts” rallied against it.

Costs highlighted

The key concern was the costs that were highlighted in Bid Window 1 that were on average R3 453 per megawatt-hour (MWh) for concentrated solar power, R3 374 per MWh for solar photovoltaic and R1 447 per MWh for wind. For the record, our current cost for the Koeberg nuclear power plant is R433 per MWh. It is noted, though, that the cost of new capacity for nuclear will be higher than R433 per MWh, because the depreciation cost will be higher for the new plant. This notwithstanding, and like our successful renewable programme, nuclear energy is the future.

Electricity demand in South Africa has plateaued over the last 10 years. The demand predictions made in the IRP 2010 have not materialised and the economy has slowed. The cause of this is important as it impacts future growth predictions.

The conundrum that planners are facing is whether the decline in growth is natural, structural or a direct consequence of the constrained supply. It is quite likely that the latter has played a significant role in curtailing demand and as the supply constraints ease, one will start seeing demand increasing above the recent trends. The increased demand, coupled with future decommissioning, will require South Africa to build new capacity. This then leads into the question of what do we build and when?

For this we need to separate dispatchable (generation options where capacity can be increased or decreased on demand) and intermittent (generation options where capacity or availability cannot be controlled, such as wind and solar) supply options. To maintain control of the electrical network system, we require sufficient dispatchable power supplies distributed strategically across the network.

The dispatchable options serve two purposes: namely as a back-up for intermittent supplies (renewables) to ensure demand is met, as well as providing frequency support without which the entire national supply system would be unstable. The larger the capacity of intermittent supply in the system, the more reactive the system needs to be.

The options

The options available for this purpose are coal, natural gas, liquid fuel, nuclear, geothermal, biomass and pumped storage. However, not all of these technologies are suitable for deployment in South Africa, based on the following considerations:

* Geothermal is not available locally.

* Natural gas is not sufficiently available to fill this role and there is uncertainty on long-term costs, though current prices are low. In addition, there will have to be limitations on maximum volumes to maintain security of supply in the event of interruptions.

* Liquid fuels are too expensive to utilise as mid-merit or base-load options.

* Biomass as a fuel source for large power generation is a potential fuel swop for coal in the future.

* Pumped storage has limited future expansion in South Africa, due to water constraints and geography.

Therefore, South Africa has only two real options for base-load and mid-merit operations to manage system requirements. These are coal and nuclear. The decision on which technology to deploy then requires an assessment of lifecycle cost, current and future predicted costs, and COP 21 commitments.

Significant debate

There has been significant debate on current and future costs of both these technologies. There is growing consensus that future cost comparisons will swing in favour of nuclear, given increasing coal-fired plant costs associated with continuously more stringent emission limits and the introduction of carbon taxes.

Nuclear would also offer more certainty on future electricity pricing. Nuclear does have high initial construction costs. However, operationally, nuclear offers one of the cheapest sources of electricity that comes with zero greenhouse gas emissions. This is clearly more favourable than any fossil power generation.

Nuclear power is the largest source of low-carbon electricity in Organisation for Economic Co-operation and Development (OECD) countries, with an 18 percent overall share of electricity production in 2013 and second at global levels with an 11 percent share. A total of 72 reactors were under construction at the beginning of 2014, the highest number in 25 years.

According to the latest reports, China would account for the largest increase in nuclear capacity additions from 17 gigawatt (GW) in 2014 to 250GW in 2050. Other growing nuclear energy markets include India, the Middle East and the Russian Federation. For a number of countries like China, South Korea and the United Arab Emirates, this has meant reducing coal reliance and the impact for these countries has been immense.

Finally, though there are a number of alternatives available, nuclear remains the best long-term option for the further development of South Africa’s energy mix that will ensure security of electricity supply while adhering to our various national and international objectives.

* Matshela Koko is the group executive for generation at Eskom.

** The views expressed here do not necessarily reflect those of Independent Media.

BUSINESS REPORT

Want a home loan? Mind your credit score

If you’re thinking about buying a home, you will most likely need to apply for finance, as most of us can’t afford to buy a house with cash.

Credit: FREEIMAGES

File picture: James White, FreeImages.com

If you’re thinking about buying a home, you will most likely need to apply for finance, as most of us can’t afford to buy a house with cash. In this case, a good credit score is crucial to get approval on a home loan (bond), as well as for future financial success and stability.

“For most people, a bond is crucial to get onto the first rung of the property ladder and plays a pivotal role in future lifestyle,” says Steven Barker, the head of home loans at Standard Bank. “However, many don’t know that there are a few conditions that must first be satisfied. One of those is to have a good credit score.”

Your credit score or rating is attached to your credit record, arguably the most important piece of financial information about you: it’s a comprehensive record of your credit history – the money you have borrowed, whether you have repaid that money and if you repaid it on time. Every time you apply for a loan from any financial institution, this record is checked. A glowing history of consistently repaying debts on time and in full will bolster your chances of an approval, as it indicates to the bank that you are financially responsible. A bad credit record of missed and late repayments means, of course, the opposite.

“It is advisable for consumers to know where their credit score stands before they apply for home loan finance,” says Barker. Fortunately, it is easy to keep track of your credit record; by law you are entitled to one free report every year. One can make use of various credit bureaus that are able to assist with making available your credit score. However, one can also be proactive and seek to improve their credit score, some suggestions include:

* Pay your bills on time. Late payments will have negative consequences on a credit score.

* Take out debt only as needed. Make certain that you are able to afford the required instalment as well as create buffers for interest rate changes. Furthermore, applying for credit leaves a “footprint” on your record and financial institutions are able to view the frequency of credit applications.

Barker states: “Even if buying a home is not on your cards yet, safeguarding your credit record should be, because you will need a good score when you eventually enter the market. Property is an asset - often a cornerstone of retirement strategies - so a long-term, protective view of your record will help you ensure future prosperity and wellbeing.”

IOL

20 seasons of greatness: Watch the best moments of Kobe Bryant's career

Kobe Bryant (File Photo)
Bryant revealed that the perfect ending would have been a championship but added that he felt good to be able to put on a good performance.

Basketball star Kobe Bryant brought curtains down on his glorious 20-year NBA career in a spectacular fashion, scoring 60 points in his final game for Los Angeles Lakers on Thursday.

The 37-year-old scored 23 points in the final quarter as the Lakers overcame a 15-point final quarter deficit to eventually claim a 101-96 win over the Utah Jazz.

Bryant revealed that the perfect ending would have been a championship but added that he felt good to be able to put on a good performance for one last time, the Guardian reported.

Known as the 'Black Mamba', Bryant hung up his boots after 20 seasons, five championship rings and 18 All-Star selections with the Lakers.

He is just the fifth player in NBA history to play 20 seasons, and the first with just one team. (ANI)

Nicola’s Notes: With love, from London

It’s always interesting popping over the pond to see life in another country.

Credit: INDEPENDENT MEDIA

Nicola Mawson, IOL Business Editor. Picture: Matthews Baloyi, Independent Media.

It’s always interesting popping over the pond to see life in another country. London is cold and, at this early hour, still dark. It’s also efficient, and surprisingly much more cosmopolitan than it was when I was last here, a decade ago.

Given the economic woes that are plaguing every market in the world, especially ours, and the troubles weighing on Europe, I was expecting to see a country that is battling.

Perhaps things in the countryside will be different. London is awash with fancy new cars, people from other parts of Europe and South America who are working hard to make a buck, accents that are not English and besuited bankers and lawyers.

The new cars, a bellhop explains to me, are necessary because of the emissions tax, so London-goers need to stay in hock to avoid paying crippling penalties.

Based on that I suspect the apparent opulence masks a reality that is very different for those who live and work here.

The economy only grew at 0.5 percent last year, which is lower than ours. Yet, only 5.2 percent of Britons are unemployed, and interest rates are at 0.5 percent, making borrowing cheap, and investing not at all attractive.

Any similarity with SA seems to end with gross domestic product growth, and the pace at which Londoners march down the streets on their way to their next vitally important meeting.

The streets are not lined with rubbish because it actually gets collected. In some cases, twice in one day.

The postal system works – if you entrust a letter to the Royal Mail, it will actually get there in a few days instead of disappearing into a void.

Drivers stop for pedestrians at crossings instead of trying to run them over.

Sure, Britons don’t seem nearly as friendly as South Africans, and the immigration guys are as hard as nails, and rude to boot.

Yet, the cops are reliable, and still someone to ask for help when you’re stuck. Ambulances can make it through London traffic because cars move out the way.

Tap-and-go as a form of payment is here. So is free WiFi pretty much everywhere you go.

Things in the UK just work.

Like traffic lights: despite the endless rain here, they all still function.

Still problems

The UK is not without its problems, such as Prime Minister David Cameron’s offshore stash, which Downing Street has said he does not benefit from.

The Brits are also dealing with refugees, and spending a fortune on treating ill Europeans in hospital without much in the way of recompense.

The difference is, while there’s graft at the highest levels, it’s dealt with transparently once it’s in the open – although Cameron really should have known better than to think he wouldn’t be bust.

National Health Insurance is in place, and – for the most part – does a decent job; although there are always tales of botched ops and misdiagnosed patients who died.

So, what sets the UK apart? In South Africa, we have world-class doctors; an economy that’s growing faster; a work ethic second to none (bar the select few who trash Joburg’s streets every few weeks) and are a nation of friendly people.

Leaky systems

It’s systemic. The systems we have in place have not been put in place properly. And they are leaking. They leak to the point where government departments operate in silos and either don’t know what’s happening on the ground, or don’t care.

The infrastructure is ageing and has not been looked after for 20-odd years, which is why water pipes keep bursting and washing the streets with our most precious commodity, and sub-stations keep falling over.

The cops are generally not trusted, and don’t seem to really care about the state of crime – when was the last time you had to open a case and the docket ended up in file 13? The last time, right?

I could go on endlessly about the issues we have; we all could.

Instead, let’s think of a solution. And I don’t mean the private sector should look at the gaps and see a way of making a buck (private security, private hospitals, medical aid...).

We need the private sector to work with the government and overhaul the systems. Analyse government structures across all levels and build it up the same way one would a business, even if it’s not meant to have a bottom line that grows.

For that, we need a willing private sector, and an even more willing government.

There’s no reason why London should seem like a better place than Joburg. Once we sort our stuff out, even the rand will benefit.

* Nicola Mawson is the online editor of Business Report. Follow her on Twitter @NicolaMawson or Business Report @busrep.

** Nicola was in London for the P9 product launchcourtesy of Huawei.

IOL

Root out businesses that fed at Nkandla frenzy

The failure of opposition parties to impeach the president in Parliament this week has presented an opportunity for action to be taken on a grander scale against businesses that profited from some of the illegal developments at Jacob Zuma’s home in Nkandla.

Credit: EPA

Mmusi Maimane (centre front), speaks on behalf of the DA during the parliamentary debate over the removal of Jacob Zuma as president. The writer says there is a greater opportunity to root out widespread corruption in business and government. Picture: Nic Bothma

After the Constitutional Court last week handed a historic judgment against President Jacob Zuma and the National Assembly for violating the constitution and ignoring recommendations that were provided by the public protector, some major steps need to be taken for the people to receive some closure and seal the taps of corruption once and for all.

With all that has transpired over the last few weeks, there is still no reason why the National Assembly and the ad hoc committee that was established cannot continue investigating and arresting those who grossly manipulated the system to enrich themselves.

Taking action

This is the time for South Africans to look beyond the resignation or impeachment of the president by acknowledging that it was not only Zuma who unduly benefited.

The Nkandla feeding frenzy has unimaginable ripple effects and if we really want to go deep, those who pocketed taxpayers’ money must reveal the extent of their opulent lifestyles. I would bet my bottom dollar that some of the flashy joints on Florida Road in Morningside, Durban, were booming at the height of the Nkandla feeding frenzy.

As much as we are a nation in peril, with many calling for the president to resign, the republic still needs to establish how the contractors and officials from the Department of Public Works were able to inflate and implement mark-ups on their services, which resulted in a gross inflation on prices in the supply chain process.

Next to the president stepping down or being removed, holding those who benefited from corruption is the next best option. This investigation will enable us to identify the companies, officials and individuals directly responsible for the ridiculous prices in the upgrades.

It will also give ordinary citizens a glimpse into the world of tenderpreneurship and how scores of businesses have unduly benefited from using the same tactics in other departments where taxpayers’ money was used. As much as the tendering and contracting with government has proven beneficial to the growth of many black businesses, the Nkandla debacle is proof that these processes can be exploited for maximum-greed.

Corrupt scumbags

The reality of this situation is that we have corrupt scumbags masquerading as entrepreneurs, giving a bad name to many other black businesspeople in South Africa who are doing things by the book, trying to make a difference in their communities.

Zuma alone coming up with the cash to pay for Nkandla is simply not good enough from a business and economic viewpoint, because it gives those who might have implemented gross exaggerations in their mark-ups a get-out-of-jail-free card.

This is undoubtedly another scar on the political consciousness of the nation as it shows how far the rot of corruption has set in the various segments of government and contracting for business.

Nkandla has further reinforced our belief as ordinary folks that the majority of politicians, not just in South Africa, but across the world, are corrupt and spineless. They are as spineless as the private and public institutions fighting among themselves to capture the South African state and all the riches that come with it.

Robert Walker, the president of the Population Institute in the UK, once wrote an article published in the Huffington Post a number of years ago that still rings in my head when politicians get caught with their pants down or their hand in the cookie jar. He said that numerous species of slugs, worms, spiders and other spineless creatures were in rapid decline.

He quoted a report that warned the rising human population was and is currently threatening one out of five invertebrate species with extinction.

He continued: “However you might personally feel about bugs and other invertebrates, the decline of invertebrate populations is not good news for humans and other vertebrate species. In terms of our long-term survival, we’re all in this together.

Still, at least one invertebrate species is thriving. The spineless politician (homo sapiens politicus) is doing quite well. In fact, it is thriving. Its vertebrate cousin (that is, the politician with a spine), on the other hand, is nearly extinct.”

For many South Africans in the post-1994 era, we have yet to see economic justice and the Nkandla debacle is fuelling the flames of regime change in South Africa.

However, least we forget, Zuma paying back the money is small change compared with what has transpired in the bigger scheme of things.

* Ayanda Mdluli is the senior writer of Glasshouse Communication Management. He writes in his personal capacity.

** The views expressed here do not necessarily reflect those of Independent Media.

BUSINESS REPORT

Root out businesses that fed at Nkandla frenzy

The failure of opposition parties to impeach the president in Parliament this week has presented an opportunity for action to be taken on a grander scale against businesses that profited from some of the illegal developments at Jacob Zuma’s home in Nkandla.

Credit: EPA

Mmusi Maimane (centre front), speaks on behalf of the DA during the parliamentary debate over the removal of Jacob Zuma as president. The writer says there is a greater opportunity to root out widespread corruption in business and government. Picture: Nic Bothma

After the Constitutional Court last week handed a historic judgment against President Jacob Zuma and the National Assembly for violating the constitution and ignoring recommendations that were provided by the public protector, some major steps need to be taken for the people to receive some closure and seal the taps of corruption once and for all.

With all that has transpired over the last few weeks, there is still no reason why the National Assembly and the ad hoc committee that was established cannot continue investigating and arresting those who grossly manipulated the system to enrich themselves.

Taking action

This is the time for South Africans to look beyond the resignation or impeachment of the president by acknowledging that it was not only Zuma who unduly benefited.

The Nkandla feeding frenzy has unimaginable ripple effects and if we really want to go deep, those who pocketed taxpayers’ money must reveal the extent of their opulent lifestyles. I would bet my bottom dollar that some of the flashy joints on Florida Road in Morningside, Durban, were booming at the height of the Nkandla feeding frenzy.

As much as we are a nation in peril, with many calling for the president to resign, the republic still needs to establish how the contractors and officials from the Department of Public Works were able to inflate and implement mark-ups on their services, which resulted in a gross inflation on prices in the supply chain process.

Next to the president stepping down or being removed, holding those who benefited from corruption is the next best option. This investigation will enable us to identify the companies, officials and individuals directly responsible for the ridiculous prices in the upgrades.

It will also give ordinary citizens a glimpse into the world of tenderpreneurship and how scores of businesses have unduly benefited from using the same tactics in other departments where taxpayers’ money was used. As much as the tendering and contracting with government has proven beneficial to the growth of many black businesses, the Nkandla debacle is proof that these processes can be exploited for maximum-greed.

Corrupt scumbags

The reality of this situation is that we have corrupt scumbags masquerading as entrepreneurs, giving a bad name to many other black businesspeople in South Africa who are doing things by the book, trying to make a difference in their communities.

Zuma alone coming up with the cash to pay for Nkandla is simply not good enough from a business and economic viewpoint, because it gives those who might have implemented gross exaggerations in their mark-ups a get-out-of-jail-free card.

This is undoubtedly another scar on the political consciousness of the nation as it shows how far the rot of corruption has set in the various segments of government and contracting for business.

Nkandla has further reinforced our belief as ordinary folks that the majority of politicians, not just in South Africa, but across the world, are corrupt and spineless. They are as spineless as the private and public institutions fighting among themselves to capture the South African state and all the riches that come with it.

Robert Walker, the president of the Population Institute in the UK, once wrote an article published in the Huffington Post a number of years ago that still rings in my head when politicians get caught with their pants down or their hand in the cookie jar. He said that numerous species of slugs, worms, spiders and other spineless creatures were in rapid decline.

He quoted a report that warned the rising human population was and is currently threatening one out of five invertebrate species with extinction.

He continued: “However you might personally feel about bugs and other invertebrates, the decline of invertebrate populations is not good news for humans and other vertebrate species. In terms of our long-term survival, we’re all in this together.

Still, at least one invertebrate species is thriving. The spineless politician (homo sapiens politicus) is doing quite well. In fact, it is thriving. Its vertebrate cousin (that is, the politician with a spine), on the other hand, is nearly extinct.”

For many South Africans in the post-1994 era, we have yet to see economic justice and the Nkandla debacle is fuelling the flames of regime change in South Africa.

However, least we forget, Zuma paying back the money is small change compared with what has transpired in the bigger scheme of things.

* Ayanda Mdluli is the senior writer of Glasshouse Communication Management. He writes in his personal capacity.

** The views expressed here do not necessarily reflect those of Independent Media.

BUSINESS REPORT

Finding the meaning in your job

Do you think we all have a career that is meant for us?

Credit: INDEPENDENT MEDIA

Dr John Demartini advises you to work in an area that reflects your highest values. File picture: Shayne Robinson

Do you think we all have a career that is meant for us? Is there a perfect job? And does this change with time?

What would be considered a perfect job would be according to what our highest values, our true priorities are. This is what is most important and meaningful to us.

It will also be something in which we excel and which we are most spontaneously inspired to do, something that is meaningful to us, that will contribute to the world around us. People go to work to fulfil their highest values – what is most important to them. If a career fulfils these highest values, you will be internally called to achieve.

Because our list or priorities or hierarchy of values can evolve through time, what inspires us can also evolve.

Do you have tips on a wish list for what would be considered a dream job?

It is wiser to focus on what is truly most meaningful to you and diligently pursue that career in a methodical and strategic manner.

Even if you have to temporarily work in an alternative or closely related field in the meantime, it is better to work your way towards fulfilling what it is that is truly meaningful to you.

Start with what you know and let your knowledge grow as you refine your master plan to create or locate the career you truly want. A life plan can include a career plan/business plan. Also, meet with others who have been doing what you would love to do for feedback and guidance.

How do you know whether feelings of unease regarding your job are just boredom, not dissatisfaction?

If you are not inspired by your daily work, you will feel unfulfilled. Anything in your daily job duties or description or your position that you cannot see as highly connected to your highest values will drain and frustrate you.

Ask yourself every three months: “How specifically will this particular job responsibility help me fulfil my highest values or whatever is most important to me?”

You become engaged and present and productive when you can see how what you are doing is meaningful and helping you fulfil your most inspired dreams and serve others. When you can’t wait to get up in the morning and deliver your service, people can’t wait to receive that.

How can unhappiness in a job affect our entire lives?

When we are not engaged and fulfilled in our careers, we become distressed and distracted and we regress into and activate our more primitive brain functions.

We become vulnerable to immediately gratifying, addictive or consumer-oriented behaviours. If you don’t fill your day with high priority actions that inspire you, your life becomes filled with low-priority distractions that don’t.

What are the steps to finding a job in the field that you love?

Define clearly what is truly most important to you, what you spontaneously love to do that also serves others, something where your inspirations match others’ needs.

You can complete the Demartini Value Determination Process (www.drdemartini.com) to help you identify what you truly value and to find careers that align most with what shows to be your highest values.

When weighing up leaving one job for another, what is the checklist of pros and cons?

Link whatever you are doing to what you love as you plan for your next career step. It is wise to either find what you love doing through delegating or love what you do through linking.

1. Clearly decide your new career path.

2. Ask yourself how your present job is going to assist you with your new career. Do this 20 times until you understand your answer.

3. Take small daily actions that will move you one step closer to your new dream career.

4. Document what worked and didn’t work each day.

5. Document what you are grateful for each day to build momentum.

What is a mantra to call on in times of job dissatisfaction?

Ask yourself: How specifically is what I am doing helping me fulfil what is truly most important in my life – my primary mission?

How are these responsibilities in the way and not in my way? How are they preparing me for what is next in my inspiring new career?

Who am I getting to connect with and what am I learning that is important for what I need to fulfil my next career role?

Dr Demartini is a human behaviour specialist and the founder of the Demartini Institute. See www.drdemartini.com.

CAPE ARGUS

From Lamar Odom to Jack Nicholson: Celebrities hail Kobe Bryant

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We need a new generation of leaders

The complexity, volatility and unpredictability of emerging markets, along with other market dynamics, are forcing organisations to critically reflect on new approaches to leadership development training and talent management.

There is an urgent need for a new generation of leaders with complex and adaptive thinking skills, and individuals who can unlock growth for their companies in creative ways.

Importantly, leadership which unlocks growth and innovation must also be mindful of social and environmental justice.

The speed of growth in emerging markets often renders our traditional leadership development models redundant. New approaches to leadership development are required.Today, human resources (HR), skills development practitioners and talent managers have to develop the leadership pipeline fast, and when external recruitment is not an option, the talent pool can either be new emerging talent or long-serving employees.

This can be a double-edged sword. On the one hand, upcoming young executives with high potential are hastily promoted into senior leadership positions, and often their leadership capabilities are undeveloped and they lack emotional intelligence.

On the other hand, and perhaps as a result of the talent wars, organisations often promote long-serving employees to senior leadership positions. And, while they are strong performers in a chosen vocation, this does not mean that they are good leaders. The impact of both these dynamics can have a devastating effect on organisations with an undesired trickle-down effect of smothering staff morale and innovation, often impacting on bottom-line performance.

In an extensive research project involving 150 executives and their staff across the Americas, Europe, Asia and Africa, authors Liz Wiseman and Greg McKeown in their book Multipliers categorise leaders as either multipliers or diminishers. Diminishers underutilise people and leave capacity on the table, while multipliers leverage resources by increasing intelligence in people throughout organisations, leaving employees smarter and more capable.

Profiling leadership

Professor Kim Cameron – a pioneer of the positive organisational development school of thought – differentiates between positively and negatively energised leaders. His research indicates significant organisational benefits from energy networks created by positively energised leaders, while viewing negatively energised leaders as toxins.

The importance of accurately profiling leadership candidates then becomes very clear with the question arising: What does a positively energised and multiplier future leader in an emerging market look like? This question is important, because it will help organisations and HR practitioners to realign their outlook and approaches to leadership development, talent identification and staff promotion.

Firstly, emerging market leaders are visionary and imaginative. They are thinkers who dream big and find solutions to problems affecting their organisations, teams, products and services.

Next, good leaders for emerging markets create an environment where collective leadership flourishes. In short, the best leaders are those who understand that collective action, dialogue and collaboration are absolutely necessary to achieve organisational goals.

An additional feature of good leadership is the ability to create happy, stimulating and safe working environments for employees and their teams. Good leaders are experts in creating experiences and events that bind team members together, and they understand how critical these experiences are for talent retention.

Closely related to this is empathy. Empathetic leaders can view situations from many different vantage points. This enables them to understand perspectives other than their own, enabling them to create more authentic relationships and stronger engagements with colleagues and team members.

Good moral judgments

Good leaders have solid values and make good moral judgments, and this is becoming a very rare commodity in the market place – at least in South Africa. Corruption is an explosive issue in emerging markets, according to the study findings and research projects which show that corruption is higher in emerging markets than developed nations.

In South Africa, we are all too familiar with corruption in all forms. Bribery, nepotism and fraud. It is a general cancer eating away at many organisations and establishments, even on an international level. Perhaps the most clear and global example this year was Fifagate. Good leaders will not succumb to temptations, because they have solid integrity.

As indicated earlier, emerging markets are intricate and unpredictable ecosystems in which the organisations and leaders have to operate. The best leader is a clairvoyant who taps into his or her instinctive leadership. This individual uses intuitive intelligence for decision-making. In the past, leadership was logical and rational, and decision-making was based on data and evidence. But mounting evidence through neuroscience is moving intuition higher up the leadership ladder. Intuitive leadership allows leaders to anticipate and forecast change, which puts the organisation in a better position to exploit new opportunities and management threats.

Finally self-aware of their own limitations, strengths, weaknesses, and prejudices – this realistic assessment of the self and its effect on others helps leaders to fill the gaps. Should a candidate be lacking in the qualities of a “positively energised leader” or “multiplier”, coaching and mentorship interventions would in most cases assist with the personal transformation required. Unfortunately a small percentage of individuals are not coachable, because they lack the capacity for honest self-observation, reflection and behavioural modification. Such individuals should be guided away from positions of influence within organisations.

New ways

There are also three future trends for leadership development in emerging markets, which require vertical development. This will include awakening leaders to do things in new ways and encouraging them to analyse and challenge old assumptions.

This process is also accompanied by testing and experimentation with new assumptions to explore alternatives. The processes will unlock a new level of development or leadership logic, which kicks in after some trial and error.

* Shalene Sogoni is a KwaZulu-Natal business development executive for the NMMU Business School.

** The views expressed here do not necessarily reflect those of Independent Media.

BUSINESS REPORT

US emerges as super-rich haven

US cities are flourishing for the first time in half a century.

There are legitimate demographic and cultural reasons for urban renewal.

Crime, which sparked the flight of the middle class from urban areas in the 1960s and 1970s, has come down.

Young people do not want to live in suburbs nor do retiring and downsizing Baby Boomers.

In addition, legal immigration has been growing, creating new demand for housing.

But in an economic context, there is more to this new urbanisation wave than the return of the middle class, young upwardly mobile professionals and immigrants.

In fact, they increasingly find themselves priced out of America’s largest cities.

Instead, as has happened in London before, such cities are becoming playgrounds for the super-rich – and not only native ones. Foreigners are buying up high-end property in US cities – and developers cater ever more directly to foreign buyers and investors.

Multimillion-dollar properties are often bought for cash and deals are executed through anonymous offshore shell companies.

Even among known owners, there are plenty of crooks and shady characters.

Meanwhile, no one knows how those who prefer to remain hidden made their money.

No one cares, either.

As long as the money is not related to Islamic terrorism, the US government turns a blind eye.

But this massive international money laundering operation comes with considerable risks attached.

New York City started this trend under former mayor Mike Bloomberg.

Before he left office in 2013, he famously declared that he would be happy to see every one of his fellow billionaires move to New York.

Money laundering

Two years ago, New York magazine published an exposé, calling multimillion-dollar digs “stash pads” – after apartments that drug pushers rent to hold their merchandise.

A year ago, a series of articles appeared in the New York Times, detailing how hard it was to identify who exactly the super-rich buying New York City apartments were.

The few that the Times dug out made a nice rogue’s gallery, with misdeeds ranging from corruption and malfeasance to tax evasion and suspected links to organised crime.

New York City remains the most outrageous example of America’s foray into money laundering.

The southern end of Central Park has been turned into a veritable theme park for the global “1 percent”, with apartments going for as much as $100 million (R1.6 billion).

According to the Times, $8bn is spent a year on apartments in the city costing $5m or more – and this figure is rising.

The selling prices of the average Manhattan apartment has now reached $1.1m, a record high.

It should be noted that lending practices are now considerably tighter and restrictions on mortgages remain in place.

But New York is merely the tip of an iceberg. Miami, Los Angeles, San Francisco, Houston and, to a lesser extent, Washington, Chicago and Boston are not very far behind.

Miami has been called Ground Zero of climate change.

Large portions of South Florida may end up under water within the next 15 years, yet, the city is in the middle of a construction boom, much of it along the shore.

Russian, Chinese and Latin American fat cats are buying condos as rapidly as they are built – often paying cash.

Prices are starting to creep up towards New York levels.

It would seem that it’s a win-win situation for the US.

Its economy is running perennial current account deficits, sending about $400bn abroad as Americans buy more goods and services than they produce.

However, the dollar is rising, thanks to strong capital inflows.

Even as Swiss banks lose their appeal to the publicity-shy rich, the US steps in to welcome their cash.

Unlike banks, which merely take cash, foreign investment in US real estate offers additional economic benefits to the country.

Construction employment rose 20 percent since the low point of the 2008/9 recession.

Along with professional and business services, it has been a driving force behind job creation in recent years, having added nearly 1 million well-paid jobs.

Meanwhile, downtown Miami is filled with financial institutions and companies providing services to the international super-rich. They manage their money and arrange residency permits and a path to citizenship that is far smoother than anything Obama’s Dreamers are likely to get.

They also help their kids to get into prestigious US colleges and universities, set up medical treatment if needed and lease boats and planes on their behalf. This means even more money flowing into the US economy, along with lots of jobs and tax revenues.

America’s businesses

As to the damage these kleptocrats and criminals cause their native countries, it is not America’s concern.

Savour the irony: The US Treasury goes hard after Americans doing shady things with their money abroad, but it welcomes other countries’ nationals doing the same thing in the US itself.

But now, with the emergence of a sizeable international class of “1 percenters” and increased flows of untraceable funds, America is emerging as a safe haven for the world’s super-rich and their money.

But there are plenty of problems looming.

Regional property bubbles are being inflated in many parts of the US, even as home prices on average remain stable – and some regions are still depressed.

New York is a prime candidate for a huge implosion.

The period of free liquidity is coming to an end and the Federal Reserve has started to raise interest rates.

A number of speculative bubbles that appeared when money was plentiful have already popped, including the oil bubble and the US junk bond bubble.

It is only a matter of time before disaster strikes overbuilt American urban centres, hitting developers and their lenders and burying ordinary people straining to pay their mortgages in overpriced markets.

Alexei Bayer is the eastern Europe editor of The Globalist. This article is published with permission from The Globalist (@theglobalist).

Develop potential in your team

There are many similarities between coaching and mentorship - the most important is that they both concentrate on developing potential.

Both involve support, questioning, development, commitment and encouragement. Mentoring, often provided from within an organisation, provides the opportunity for the junior to follow in the footprints of someone more experienced, traditionally older and wiser.

Consider a sports coach – they could be outsiders who are secured for their ability to bring out the best in a sports team. They arrive twice a week for team practices, and are present when the going gets tough – at the matches, shouting direction from the sidelines and providing motivation at half-time. After the game, they congratulate the team or, if there is a loss, they identify the weak spots. A coach is a facilitator, a supporter and not a friend. They should listen, guide, inspire, motivate, direct and challenge you to ensure personal growth.

Coaching happens through a series of goal-directing conversations that are outcomes-based, with the coach responsible for direction and the client responsible for action.

* Extend personal development.

* Upgrade your efficiency and effectiveness.

* Enjoy external deliberation and processing of your ideas, conflicts and challenges in an environment of security and trust.

* Stimulate change and a paradigm shift and assistance in thinking differently.

* Help you focus on the solution, rather than the problem at hand.

* Help you focus on action and accountability.

* Elevate your productivity

* Develop and drive a succession plan that outlines where to next for you and your team.

The outcomes of professional coaching can be seen in leaders who show more confidence in their decision-making. In turn the leaders will foster engaged and motivated team players so that there is ultimately benefit not only in personal productivity but also in team productivity as a whole.

* Jenny Handley is a brand, high performance and leadership specialist who offers individual consultations and team workshops. For information on Jenny’s books and courses visit www.jennyhandley.co.za. Follow Jenny on Twitter: Jenny_Handley and Facebook: Jenny Handley Performance Management.

CAPE TIMES

Key to success? The right people

Johannesburg - Almost 16 years ago Kevin Hedderwick entered the world of Steers when its market capitalisation was R105 million and its share price R1.69.
This was at the time when there were jitters in the market with McDonald’s entering its space, but that made no significant difference.

Credit: INDEPENDENT MEDIA

Kevin Hedderwick, the chief executive of Famous Brands, says you can have the right process but if you don't have the right people, you will not succeed. File picture: Leon Nicholas

Hedderwick thrust Steers forward and it became what can be described as a fairy-tale involving the acquisition of household brands like Wimpy, Debonairs Pizza; Fishaways; Mugg & Bean; Tasha’s; House of Coffees; Milky Lane and many more. Today the business is called Famous Brands and it has a market capitalisation of just over R14 billion and a share price of close to R134. Can anyone doubt this man’s ability to create a successful, dynamic movement?

A down-to-earth man

Hedderwick easily refers to Adrian Gore and Stephen Saad as examples of great leaders who have achieved the extraordinary. When I suggested it was time to place him in the same category, he was hesitant, as though he did not feel worthy of joining them yet.

His response is indicative of his character. Despite the fact that he started out on this journey with only the desire to not be poor but then achieved success beyond his expectations, he remains a down-to-earth, humble human being.

In the bigger picture this may be more admirable and positively affect the people around him more than his business achievements. People follow great leaders because of who they are, more than because of what they say or have achieved – though what you have achieved usually helps to form who you are.

Digging deeper to find what drove the man – whether it was as simple as a desire not to be poor – I discovered more. His mother’s influence was central. She repeatedly said to anyone who would listen to her: “This kid is special.” He lost her when he was 17 years old, but she had made her mark. The belief that he was special grew inside him and he has achieved consistently since then.

Hedderwick has “street cred” in his industry. He left a very senior, cushy corporate post to start a Keg franchise in East London where he mopped floors and served tables. Possessed of a competitive spirit, he and his family took the struggling pub to becoming the “Keg of the year”. Head office needed his corporate leadership experience to take the restaurant chain forward. He, meanwhile, was craving greater mental stimulation. He was appointed managing director as expected. This added perfectly to his experience for what lay ahead.

In leadership he talks about two fundamentals. The first is people: “Leadership is having the ability to surround yourself with the best damn people you can find, and it doesn’t matter if they are smarter than you or academically brighter.” The other fundamental is process. These are the two things he feeds off: “People, being able to pick them, spot them. And process is the ability to be able to go and look for best practice and install it wherever you go, for continuous improvement.”

He has come to learn that managing people is not complex; they need three things: “Tell me what you expect of me exactly; give me help when I need it; and reward me accordingly.”

This may seem simple, but it is not easy. Hedderwick had to learn the hard way, probably the only way with anything worthwhile.

The right people

When he started at Steers, he brought blue chip company principles along. He explains: “What I did have in my tool box was process and I pushed all this process into the business. It didn’t work. The reason was that we didn’t have the right people in place. You can’t have the one without the other. They feed off each other.”

The Famous Brands success thus far has also been the result of sticking to their core: “In the early days we were under no illusions as to what our core was.”

There was also understanding of the market “in terms of where you are going to participate or play”, says Hedderwick. At Famous Brands they continually drive for answers to two questions: “How do we get closer to our customers (franchisees) and how do we get closer to our consumers (clients in restaurants)?”

Another part of his success was the backing of the main shareholders, the Halamandaris family and its vision to bring someone from the outside in and support the overall strategy.

Hedderwick and his team would never have achieved success without his culture of hard work and attention to detail, which he says takes some of the risk out of the journey. He also states: “If you are going to be successful in any business, you have to be fanatical about the detail. I don’t know whether you can be a great leader if you don’t pay attention to the detail.”

During a personal discussion with the global chief executive of Coca Cola in Atlanta, Hedderwick asked him what the one thing was about managing such a large corporate successfully.

His spontaneous response was: “Kevin you have to have line of site.”

For Hedderwick, this is about being close to the detail. As organisations grow, hierarchy follows, and leaders become further removed from the people and the essence of the business. He believes in flat structures for this exact reason, “to keep your finger on the pulse”, he adds.

The greatest challenge for success is when a leader or team reaches a place where they believe they have arrived. At that moment, Hedderwick says, they start moving downward.

He believes the way he has prevented hubris from sneaking in the back door has been by surrounding himself with a great team of people, “who execute flawlessly as we want them to do”, he says.

Growth champions

The team prompts him about growth, because they are fanatical about being “growth champions”. Hedderwick explains: “Growth is never off the agenda at Famous Brands.” They also do climate surveys on a regular basis and feedback from stakeholders is that they have a high performance culture, which they protect fiercely.

As a business , they have completed one chapter and I can’t help sensing that they will write several more. They have a strong balance sheet, no debt, are highly cash generative and according to their credible leader: “Famous Brands is about to embark on a whole new chapter in its life.” This could be another AVI or even Bidvest story with a great leader at the helm and a team who know that their strengths lie in brands, logistics and manufacturing, and their understanding of the food and beverages space.

For Hedderwick, self-belief, tenacity and lots of courage are key. This Famous Brands team has a lot going for it. At this stage of the journey it seems unstoppable. Like the All Blacks rugby team, they have moved from good to great. The next chapter will probably be about moving from great to significant.

* Adriaan Groenewald (@Adriaan_LP) is the author of the recently released Seamless Leadership: Universal Lessons from South Africa (@SeamlessLeader). He is a leadership expert, commentator and presenter of the Leadership Platform show on Mondays on CliffCentral.com @LeadershipPform)

BUSINESS REPORT

Focus on the big picture

On his Facebook page Mzwanele (Jimmy) Manyi said this: “100 days later, Mmusi Maimane, the DA leader, says his focus is NOT blacks but South Africa.

Credit: INDEPENDENT MEDIA

While Jimmy Manyi stirs vigorous debate, the writer says he has joined a growing group of opinion leaders who judge statements from a distance or quote comments by other leaders out of context. Picture: Chris Collingridge

On his Facebook page Mzwanele (Jimmy) Manyi said this: “100 days later, Mmusi Maimane, the DA leader, says his focus is NOT blacks but South Africa. So the prioritisation of black people is NOT DA policy. I just feel sorry for ALL the blacks in the DA who may have rightfully or perhaps naively thought racism in the DA has come to an end. It has NOT. Mmusi FAILS to understand the Equal Treatment of Unequal People is Unequal.”

While Manyi stirs vigorous and often sound debate on his Facebook page, it seems this time he has joined the increasingly growing group of opinion leaders in our society that judge statements from a distance or quote comments by other leaders out of context in support of their own views of the world.

Lazy thinkers

And what is sad is that many lazy thinkers express their unwavering support for such tunnel vision views, without really thinking it through.

We live in a country where whom the message comes from carries more weight than the substance of the message. In other words, just because President Jacob Zuma says something the opposition feels they must criticise. Or, just because Mmusi Maimane says something the opposition must criticise. Yet – and closer to home – just because I as a white South African male share these views many will feel they must criticise me.

This is extremely immature leadership and definitely not how Nelson Mandela led. And it most certainly is not in the spirit of the National Development Plan (NDP), country vision and even the Freedom Charter.

I am not politically affiliated but look at this from a leadership point of view. A leader must always serve the bigger picture. For Maimane to therefore state that he focuses on South Africa rather than on blacks (if indeed this is what he said), could be effective and visionary leadership rather than a statement that must be panel beaten into a racial conversation.

The fact that Maimane (or whomever) focuses on South Africa as a whole does not exclude a passion for economic transformation, or eradicating racism for good, or even a healthy and authentic implementation of our broad-based black economic empowerment strategy.

No doubt any leader that genuinely focuses on the big picture of South Africa and even the globe will with equal passion push transformation – whatever it takes to turn South Africa into the nation it is capable of becoming. However, because of a focus on South Africa the leader will have a “true north” direction to keep him authentic, as opposed to tunnel vision of one important obstacle in our country that will without doubt lead to shortsighted decisions.

When I sat with Zuma in 2011, I got the distinct impression that his focus was not on “blacks” but on South Africa. Much has happened since then, but I am willing to bet Manyi that Zuma still believes this is his focus – whether most agree or not is another debate.

Sitting with former president Kgalema Motlanthe on more than one occasion, the same impressions came to me – he has a focus on South Africa and his vision is not a tunnel one with emphasis on one element of the country.

Difficult lessons

We have learnt some difficult lessons in our history that would be foolish (injudicious, ill-advised, imprudent) to forget and repeat. We have learnt that building a future that excludes or alienates certain groups based on race is shortsighted and obviously unsustainable.

When this happens the excluded parties tend to withdraw, become negative, resist passively and eventually even aggressively. Let us learn from history!

Any leader in South Africa that builds his/her vision on a focus around “blacks” or “whites” rather than “South Africa” is immediately falling into the trap of the same historical mistakes, sending a message of exclusion and alienation. All of us must comply with the spirit and letter of transformation through delivery of empowerment expectations, and more.

But this compliance must be built around a solution that serves South Africa and that does not neglect or alienate participants that have experience, expertise and much needed resources, but in fact takes them along on this journey. Maimane must continue focusing on South Africa because it is the right thing to do.

South Africa longs for leadership where we trust undoubtedly in the motives and intentions of our top leader, president and chief executive. We need a president that shows through consistent words and actions that South Africa as a country, and all who live in it, is top priority.

We need leadership that embraces personally and nationally the vision as described in the NDP. This vision is not for blacks only and it is not for whites only. It is for all of us! Let us serve South Africa and not just one tunnel vision component of it.

* Adriaan Groenewald (@Adriaan_LP) is an author, leadership advisor, managing director and co-founder of Leadership Platform (www.leadershipplatform.com). He presents the Leadership Platform show on Cliffcentral.com every Monday from 12pm to 1pm (@LeadershipPform)

** The views expressed here are not necessarily those of Independent Media.

BUSINESS REPORT

Leaders must act quickly to adapt to student protest

Shifts in our society are and will compel leaders to change, to become more authentic, to “get off their podiums” and truly serve the people rather than entertain their own belief that the people are there to serve them.

Leading this attitudinal shift is our next generation, the higher education students of South Africa. They are fearless, refuse to automatically respect leaders because of their positions, and have the power via social media and physical energy to unite and rally together in great numbers for a simple cause they believe in.

They truly can be the generation that becomes unstoppable, only to be tamed by those with genuine motives that have their trust and a passion for fairness.

Divided leadership

When masses unite in a single-minded and clear cause they will only respect and allow themselves to be led by an equally united leadership team. And let’s be frank – the South African government and even the ANC leadership seems divided, fragmented and not respected sufficiently to lead this united body of youngsters.

As a result, the leadership of this country has already lost control. With the current #FeesMustFall situation our government can do one or more of three things: 1) Hope the student leadership remain authentic in their cause and not become power hungry; 2) intensify violent resistance with armed forces – show them who is boss through an aggressive push back, as was done in the past; 3) humble themselves and consciously start a long journey of truly connecting with their own purpose and the needs of the people – in essence, build trust.

We know that number two is not an option and in fact almost impossible in today’s highly visible world, without suffering irreparable collateral damage. History has witnessed many student uprisings before. However, this year may be a perfect storm where several factors collide, making the current scenario unprecedented. At the core of it is a modern, fearless younger generation, with the unmatched power of connectedness of technology.

From the events of the past two weeks, it is easy to see that there is a general trust deficit between leaders and followers in our society, coupled with the reality or perception of weak leadership at the top. There is also a sense that current leadership has been underestimating the frustrations of the younger generation, instead putting loyalty politics at the heart of everything it does. This will never replace accountability.

In the last few days the leaders of the country are being called to account. And unfortunately our leaders are simply not prepared for this type of occurrence. Ironically, they should be the best prepared, considering their struggle credentials, background and their understanding of the history of this country.

On the other hand, the student leaders seem to outshine the struggle heroes who are supposed to be seasoned leaders. Perhaps because the seasoned leaders have lost their way, forgotten what it’s like to unite passionately behind a cause, to serve the people. Many of them have fallen prey to serving lower values like bureaucracy, compliance, entitlement, pride, defending or protecting a leader rather than a cause; wealth generation at the cost of a higher purpose and holding on to power for the sake of it. The list is endless.

But let me illustrate what an authentic leader could have done on the day that students marched to Luthuli House. I know it sounds simple with hindsight, but imagine Gwede Mantashe stepping out of the building on the same level as the youngsters and proactively suggesting they sit down to discuss matters eye to eye.

This proactive stance and symbol of humility and strength would have disarmed the crowd and won them over immediately. Apparently this is what vice-chancellors across the country did – when students asked them to sit down they did.

Instead, Mantashe came out elevated, with a proud, stubborn attitude of “I am the leader”, or “these youngsters must respect me”, or “I cannot negotiate from a position of weakness by giving in all the time”, or “I must show the world that these youngsters will not scare or manipulate me/us, the powerful ANC”.

Those that still hold on to these beliefs that may have driven Mantashe’s behaviour of last week would have felt that he showed his strength. But those that matter most in this particular battle – the students – lost respect for him. He did not build trust but broke it down even further. Trust someone and they will trust you back. Mantashe did not trust the students and they will not trust him back.

What could President Jacob Zuma have done had he been in tune with brilliant leadership? He could have sat waiting for the students, until they all arrived. And then, at the right moment made his bold announcement, with the education and student leaders flanking him, raising their hands as a token of solidarity.

Missed opportunity

And then he could have gone down and shaken some hands, looked the students in the eyes. Instead, he was an everyday political leader that always makes crowds wait in the sun, because they (politicians) are the important ones, until the crowds become agitated and take it out on each other, or the police.

He made his announcement via a television screen and walked away from a great opportunity, no doubt with the compliments of his advisors echoing in his ears: “Good job Mr President! They will say the government listened to the people. That was a victory”. But in fact, the students lost all respect and trust, walking away with a belief that he opened a can of worms and that this is only the beginning.

What is happening is good, but of course it comes at a cost – no good has ever been achieved without a price. The positive is that up until today no one, not even the opposition, had managed to humble some of our leaders – to shift their attitudes significantly – not with the persistent, aggressive criticism and disruptions of opposition parties, or wealthy business owners that pull the purse strings for politics to function, or the media that incessantly yet importantly look over the shoulders of politicians, or a relentless public protector.

It takes youngsters to expose and force them to become real and abide by promises, to lead as they ought to.

Having said all this, leading such an uprising in an effective, co-ordinated and controlled way is not an easy task and must never be underestimated. As numbers increase the space for outside forces to infiltrate its ranks grow and then things go wrong. Student leaders must guard vigilantly against radical, one-sided and tunnel vision agendas that will aim to hijack their movement, which seems to have pure and clear intentions to build this country.

Adriaan Groenewald (@Adriaan_LP) is a leadership expert and author of recently released Seamless Leadership: Universal lessons from South Africa (@SeamlessLeader). He presents the Leadership Platform show on Mondays 12pm-1pm on CliffCentral (@LeadershipPform)

** The views expressed here do not necessarily reflect those of Independent Media.

BUSINESS REPORT

On one hand, games are shifted out of drought-hit Maharashtra, on the other DDCA uses RO water

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Skills planning for tomorrow must begin today

South Africa has a unique opportunity to spearhead growth, create jobs and improve social stability in the decades to come.

Credit: DoC

Workers at the Transnet engineering Koedoespoort plant in Pretoria. Transnet and General Electric South Africa Technologies have gone into a partnership that has provided training in both technical and non-technical skills, the writer says. Picture: Department of Communications

South Africa has a unique opportunity to spearhead growth, create jobs and improve social stability in the decades to come. Like other countries in sub-Saharan Africa, South Africa is experiencing rapid population growth. The region already has the world’s highest proportion of people under 25. By 2025 it will be home to around a quarter of the global population aged 24 and younger.

This growing and increasingly youthful population is a great asset, presenting South Africa with the opportunity to gain the “demographic dividend” that other parts of the developing world have experienced.

The dividend comes when the growing workforce is successfully employed, directly raising per-capita income and, since working-age people typically save more, greater domestic savings become available to fund investment, boosting current and future growth.

Significant opportunity

The UN estimates that South Africa’s population will increase to 66 million by 2050, presenting significant opportunity. An important complement to this demographic opportunity is South Africa’s robust country development plan, the National Development Plan (NDP) or Vision 2030.

The NDP seeks to unlock country-specific and Africa-wide socio-economic drivers such as regional integration, intra-trade among African countries, skills development, SME development and increase export earnings. All of these will be needed if South Africa is to overcome its current unemployment rate and shift the tide towards growth.

Unlocking the potential of the demographic dividend requires investment in skills to develop infrastructure and bolster the manufacturing and services sectors. In order to build faster, more sustainable job creation, we need to consider a three-pronged strategy based on:

- A stronger education system with closer links to industry.

- More open and flexible labour markets and a broader talent localisation strategy pursued in partnership with global companies.

- The pipeline of skills needed to leverage the technological advances of tomorrow.

A stronger education system

Education systems need strengthening through greater investment and closer links to industry to better align the demand and supply of skills.

Specifically, more students should be steered towards STEM subjects – science, technology, engineering and mathematics – which are necessary to speed up the development of infrastructure.

Equipping students and workers with the right skills is the first step towards creating more sustainable jobs with higher remuneration and better career prospects.

Labour market flexibility and talent localisation

While meaningful progress has been made in improving the business environment, more is needed. Policymakers should focus on creating a level playing field, removing regulatory burdens and red tape, simplifying and streamlining administrative procedures and further improving transparency. These advances would allow global companies to scale up their operations more rapidly and to localise production, accelerating the transfer of technology and skills.

Multinational companies must act as a strategic and value-adding partner in pursuing this strategy. Importantly, the joint efforts of government and private companies are beginning to bear fruit.

Training and technological transfers in areas such as transportation and health care have begun to accelerate the creation of necessary skills. Through our partnership with Transnet, General Electric South Africa Technologies, a joint venture with the Mineworkers Investment Company, has provided training in both technical and non-technical skills, which has created thousands of new employment opportunities and sustained existing jobs in the locomotive industry and beyond.

We’re also developing our local supply chain through supplier development programmes, which include skills training, financial assistance and incubation of black-owned small- and medium-sized businesses. The business development services focus on strengthening business acumen, as well as operational and financial management skills, while the technical development services include engineering support and technology transfer.

This support is aimed at helping emerging young SMEs from their early development stage, the time at which they are most vulnerable, right through to ensuring a sustainable and growing business.

We believe that skills training and development must happen at all levels of the economy – from our existing employees, to our suppliers and our customers. We also invest heavily in early-career development to ensure that young people are prepared to lead our economy into the future.

A pipeline of skills for tomorrow

It’s critical that skills development focus not only on the jobs of today, but also tomorrow. Digital technologies are beginning to permeate the industrial world, triggering a new industrial revolution that will transform the way we work and redefine the competitive environment for companies and countries. At General Electric (GE), we call this the Future of Work.

Changes to our education and training systems should be geared to shaping the workforce of tomorrow. This would enable local skills to quickly adapt to the changing demands of industry. Government should also encourage and leverage entrepreneurial and innovative spirit. In Kenya, for example, the mobile payments system M-Pesa has bypassed the traditional banking system, transforming financial transactions and boosting economic activity.

Similar thinking could be applied in other areas where lack of infrastructure is an especially acute problem, such as power generation and distribution, and health care. GE has invested R500m in a customer innovation centre in South Africa that will be a centre of excellence for innovation and technology transfer.

New innovations provide a huge opportunity for South Africa, and indeed the continent, because they can allow the region to leap-frog existing industrialisation models. For companies and individuals alike, the Future of Work brings tremendous opportunity for South Africa. Through the power of both minds and machines, it can allow the country to build a range of manufacturing and services activities that will remain competitive for decades to come.

The key to realising this is investing in people.

* Jay Ireland is the chief executive of GE Africa. Parts of this article are adapted from a new GE white paper titled Building strong workforces to power Africa’s growth.

BUSINESS REPORT

Today’s leaders must push through turmoil

South Africa can be a challenging place to do business and these challenges offer unique opportunities.

Credit: SUPPLIED

Allen Shardelow is the partner in charge at the Johannesburg office of global executive search and professional services company Heidrick & Struggles. Picture: Supplied

South Africa can be a challenging place to do business and these challenges offer unique opportunities. Business leaders increasingly have the chance to shape South Africa’s future.

But the role that business plays in society, and the expectations about the role it should play, have shifted dramatically. Along with this shift, society’s expectations and the public narrative about leadership have changed too.

Declining levels of public trust suggest that public and business leaders have not kept pace with increased expectations.

Global leadership advisory firm Heidrick & Struggles in association with the Saïd Business School at Oxford recently released “The CEO Report: Embracing the paradoxes of leadership and the power of doubt”, which presents findings from its interviews with more than 150 sitting chief executives around the world. The report explores these issues along with the central question: how do leaders and senior executives develop the competence to lead in a changing world? The findings are instructive and contribute to the leadership debate in the South African context.

For chief executives, assessing the changes facing their companies or institutions in volatile times is difficult. Doing so under the real-time gaze of stakeholders ready to tweet and retweet assessments at a moment’s notice compounds the challenge. It’s no surprise that many leaders feel preoccupied with the pace of change.

Given the pressure to respond faster and faster to events, how can leaders ensure they assess the nature of the changes appropriately while also determining how and when significant change will affect their organisations? In other words, how can they lead continuous change while also responding constantly to it? The key, the research suggests, is to focus not only on the speed of change, but on its scope and significance as well.

The chief executives interviewed routinely spoke of the pressure today’s pace of change imposed on them, citing factors such as disruptive new competitors and new market channels, often digital. Predictably, many cited technological innovations, particularly the rise of social media, as driving a ubiquitous sense of urgency and pressure for increased transparency. In fact, many chief executives view social media as a two-edged sword, both a powerful tool for engaging in public discussion, as well as a potential source of exposure to challenges on their leadership.

Some chief executives highlighted the importance of discerning the true speed of change. They cautioned that a more granular understanding of change helped them prioritise, delegate, and allocate energy and resources. The impact of scope can be difficult to predict: even systemic changes can have root causes that were initially contained and local – for example, the seemingly localised US sub-prime credit crunch that became a global crisis.

Pace of change

A pervasive sense of urgency can mask the fact that not all aspects are changing at the same pace, or even changing at all. Indeed, one chief executive pointed out that while his sector (banking) had faced substantial changes, in many respects its core principles remained the same.

Others emphasised the need for a long-term perspective: “The world has changed and stability is different than before,” observed one chief executive, “although we have selective memory in the sense that we think we are living in the most turbulent times you can imagine.”

And another offered a healthy dose of scepticism, saying: “There is this mantra at the moment that change is faster than it’s ever been and therefore these kinds of issues are going to be greater… I don’t really buy that.”

When it comes to coping with the pace of change, chief executives referred to several rules of thumb. One described a “more principles-based leadership style” to “spend the time, rather than giving the answer, setting the stage and context and then have other people work out what the pieces are within it”.

Highlighting the need for resilience, another said: “You have to look at almost everything as something that could kill you, and you have to have a battle plan for not only how you are going to… optimise it, but how are you going to survive it.”

While the focus on the speed of change is not surprising, chief executives indicated that there were two additional, more subtle dimensions of change that a preoccupation with urgency could mask. On of these dimensions is the scope of change – the size and extent to which a particular event or trend is far-reaching.

The greater the scope, the more likely it will become significant and affect the organisation. Trends take different forms: for example, geopolitical upsets such as the conflict in Ukraine; economic changes (for example, in energy prices); or health threats such as the recent Ebola crisis.

The impact of scope can be difficult to predict. Some changes may be more evidently systemic, such as the recent global financial crisis; others may generate substantial attention but actually turn out to be more contained, with less impact.

Significance

The final dimension is significance, which refers to how deeply any change affects the organisation. Predicting and assessing significance as data accumulates is crucial. It means asking “how, how fast, and how much” an event will impact the business.

As one chief executive noted, “You have to begin to sort out the results you’re getting. Are they a result of a broader macroeconomic or industry shift taking place, or are they more enterprise specific?”

The recent drop in the price of oil highlights the complexities involved in navigating the three dimensions of change. The sheer speed and scope of the price fall in the last 12 months has taken most by surprise, even though the fundamentals driving the price shift are well known: rising supply from shale gas in the US and weakening demand in other large economies.

While the full significance of the changes play out, the implications are likely to be far-reaching in scope and highly significant for many countries and businesses. Some industries face the possibility of significant knock-on effects in terms of growth, jobs, investment, and perhaps even industry restructuring.

Accordingly, how any given change will affect a company varies. Some changes will influence the business model, strategy, or operations of the business – technical changes. But other changes are more profound and foundational, challenging the organisation’s mission and core values. What looks like a purely technical decision can also have value-based implications that make it foundational.

Cyber threats, for example, are likely to represent technical changes for most businesses but will be foundational for a smaller group, such as computer firms (though what may initially appear technical can quickly become foundational, as Sony’s battles with cyber security suggest.)

More complex

Untangling scope and significance is vital. Seemingly large events may end up being relatively insignificant; others may be small in scope but prove highly significant because they trigger concerns inside the business or among external interest groups. For leaders of large and diversified entities, questions of scope and significance will be much greater as their environments grow more complex, and as stakeholders declare new agendas or more actively pursue existing ones.

Navigating change along its three dimensions requires different competencies. Global operations mean thinking about local conditions. They need the capacity to scan the environment for emerging trends that might appear isolated and contained, but are actually linked in hard-to-predict ways, creating ripples of significance that can bring destruction or opportunity.

The change landscape is constantly evolving, and any given event or trend will mean different things for particular industries, regions, and individual businesses. What’s important is developing a multi-dimensional approach to change that helps leaders understand and prioritise actions, direct resources, and, crucially, reserve their own energy for significant, large-scale challenges.

Remembering that fast doesn’t necessarily mean urgent or important is a critical first step in determining where to focus attention. Diagnosing the likely impact of events and trends means assessing scope and significance along with speed.

Increasingly leadership needs flexible, systemic thinking from those that are comfortable with uncertainty, complexity and constant change. These qualities need to become part of the national narrative on our leaders and how to best effect change.

Allen Shardelow is the partner in charge at the Johannesburg office of global executive search and professional services company Heidrick & Struggles.

** The views expressed here are not necessarily those of Independent Media.

BUSINESS REPORT

Women key to community development

South Africa needs more women starting and running their own businesses, if the economy is to fire on all cylinders and create much-needed growth and jobs.

Credit: SUPPLIED

Happy Ralinala is the head of business banking for South Africa at Barclays Africa Group. Picture: Supplied

Despite the significant progress that the country has made over the past two decades in advancing the empowerment of women, more still needs to be done when it comes to women entrepreneurship. The world of business remains pretty much a man’s world.

Recent trends indicate the number of self-employed women in South Africa is in fact in decline, which means the full participation of women in the economy is being eroded. At a global level, statistics show that while women make up about 50 percent of the world population and 40 percent of the global workforce, they own only about 1 percent of the world’s wealth.

Compared with men, women’s unemployment levels remain higher both in educated and less-educated categories. Although these statistics are global, local figures tend to mirror these trends.

Women entrepreneurs in South Africa, however, still face more obstacles in starting their own businesses than their male counterparts.

This is notwithstanding the fact that women generally bring certain unique abilities to entrepreneurship. We know that given the opportunity, women would invest most of their income into their families and communities. This means that putting more wealth in the hands of women could have a significant positive multiplier effect on the economy.

The multi-dimensional challenges that women continue to face include financing and their own credibility as business owners and managers.

Access to finance and credit in particular remains a major constraint for many would-be entrepreneurs. Women – and rural black women in particular – continue to have a raw deal in this regard. They have difficulties accessing finance for various reasons, including poverty, limited employment in the formal sector, and cultural barriers to land and property ownership. Access to bank funding is also on average more restrictive for women-owned small and medium enterprises (SMEs).

Hurdles

Added to these, other barriers include socialisation networks and practices, family roles and possible lack of business contacts. Social conventions, for example, dictate the roles of men and women in the household, workforce and society.

These conventions tend to have a negative effect on the ability of women to start and grow their businesses. These disadvantages, therefore, can explain higher failure rates and lower growth rates for women-owned businesses.

Indeed it is not true to suggest that it is all doom and gloom for women. On a positive note though, a number of women have made major inroads in business and their impact is just slowly beginning to be felt.

For example, there are many women in Africa who have gone beyond making handicrafts or running spaza shops or taverns to becoming successful business owners with vast empires in various sectors of the economy.

Their successful ventures have translated into high financial returns and created many jobs. For these women, business success has not always come easily.

Most of them remain the exception rather than the norm, and their success has come largely through a combination of hard work, unbridled tenacity and sometimes sheer luck.

Despite the inequalities between men and women in business, there is a lot that can be done to build a better future for female entrepreneurs.

The challenges women face provide opportunities for women themselves, various stakeholders, including the NGOs, the government, financial institutions and other private sector players in addressing the issues. We all need to become more committed to fostering an environment that supports women entrepreneurs.

Obstacles

At Barclays Africa we are doing our bit in trying to remove the obstacles to business opportunities and economic participation that women face.

We are doing this partly by providing various forms of both financial and non-financial support. Through a number of initiatives we are also identifying and building up networks of women entrepreneurs to empower them to successfully own and operate their businesses.

For example, through our annual “Women in Business Series” we are bringing together a strong circle of female mentors to accelerate women-led entrepreneurship across all sectors.

Although our entrepreneurship development programmes are designed to support both men and women, young and old, we find that support from peers as well as more organised support and formal entrepreneurship activities are important for everyone, but particularly so for women.

At a much broader level, we should consider finance facilities that are dedicated to women-owned SMEs, with commitments to help finance new projects in areas where there is great potential to empower women and grow the economy.

The idea is to increase access to capital for women-owned businesses. Barclays Africa already has such a facility in the form of its Women Development Fund.

We believe such efforts could enable more women entrepreneurs to affordably invest in their businesses. In the long run, this would create new jobs and significantly contribute to economic growth.

Happy Ralinala is the head of business banking for South Africa at Barclays Africa Group.

** The views expressed here do not necessarily represent those of Independent Media.

BUSINESS REPORT

Root 50 guides England to 155-9

Kolkata – Joe Root hit a fluent 54 to help England post 155 for nine wickets against West Indies in the final of the sixth World Twenty20 at Eden Gardens on Sunday.

Credit: AP

England's Joe Root hit a fluent 54 to help England recover from a poor start and post 155 for nine wickets against the West Indies in their final World T20 match on Sunday. Photo: Saurabh Das

Root’s second fifty of the tournament helped the 2010 champions to recover from a poor start but England could not capitalise on the platform and settled for a modest total against the 2012 winners.

After West Indies skipper Darren Sammy won the toss and elected to field, leg-spinner Samuel Badree claimed two early wickets and collaborated for a third to reduce England to 23-3 inside five overs.

Badree pegged back Jason Roy’s leg-stump with the second ball of the match, took a catch to send back Alex Hales and dismissed Eoin Morgan in the fifth over to deny England a strong start.

Root bailed out England, adding 61 runs with Jos Buttler (36) who hit left-arm spinner Sulieman Benn for back-to-back sixes before holing out in the deep.

Dwayne Bravo (3-37) struck twice in the 14th over, dismissing Ben Stokes and Moeen Ali, and Root perished in the next over, trying to scoop a Carlos Brathwaite (3-23) delivery.

Both sides fielded unchanged squads for the match which will see one of them becoming the first team to win a second World Twenty20 title.

– Reuters

IPL 2016: Shifting of matches not a big issue, says David Miller

David Miller
Earlier, Sunil Gavaskar and Rahul Dravid came out against the Bombay HC's verdict.

Kings XI Punjab skipper David Miller is not too worried about the ongoing issue of moving the IPL games out of Maharashtra and said his team would look to make their home wherever they find themselves after the matter is resolved.

BCCI and the Bombay High Court are in a tussle regarding the shifting of IPL matches with the latter directing the Indian Cricket Board to shift all the IPL matches after April 30 out of Maharashtra, observing that the plight of drought victims cannot be ignored.

"To be honest, it is not really too much of an issue. We have not discussed or talked about that in our team. But wherever we find ourself if the fixture is changed we will look to let do with it and make it our home. We are not too sure about it right now," Miller said.

Kings XI have three IPL matches against -- Delhi Daredevils (May 7), Royal Challengers Bangalore (May 9) and Sunrisers Hyderabad (May 15) -- scheduled to be played at the Vidarbha Cricket Association Stadium, Jamtha in Nagpur.

After a dismal start to their campaign in IPL-9 where they lost to Gujarat Lions in the opening match, Kings XI is set to take on Delhi Daredevils tomorrow and Miller said they will look to be more clever in the middle overs.

"It was not a good first game. Forget about that, we were 20 runs short and so it became difficult to defend but we prepared well in Delhi. We have been here for three days and it was nice to get into the nets. We have become familiar with the conditions," Miller told reporters on the eve of the match.

"Last game, myself and (Glenn) Maxwell were dismissed in one over and it was the turning point of the match. We would look to learn from our mistakes. It was a big momentum swing and then the batters had to rebuilt the innings. It was a big negative. So we have to be more flexible and work on our depth. We need to be clever and run hard for singles and twos.

"It is all about being more clever in the middle overs and finding that balance between limiting the damage and going for boundaries. We still have 13 games to go so lets hope (for the best)," said the 26-year-old South African.

Donald Trump’s legacy of luxury

London - As he continues to up-end the Republican Party and defy the normal rules of political gravity, Donald Trump was drawn into a brief reflection on the man who first set him on the road to fame, frivolity and fabulous wealth - his altogether more level-headed father, Fred C Trump.

Credit: REUTERS

Donald Trump's legacy is far removed from that of his father, says the writer. Picture: Rebecca Cook

The elder Mr Trump, who died aged 93 in 1999, in theory offers his son a useful narrative of a family empire. The business, while not entirely altruistic in its mission, nonetheless was focused, notably in the years after World War 2, on providing simple but decent housing to New York's working middle class - as well as returning soldiers - frequently on the back of federal housing programmes.

“My legacy has its roots in my father's legacy,” the mogul turned presidential hopeful acknowledged, responding to a Washington Post examination of the very expansive footprint that Trump Sr left on New York City, mostly in the form of red-brick housing complexes in its outer boroughs, like the very large Trump Village completed in Coney Island in 1964.

The younger Trump, of course, took the business in a different direction, aiming higher - which is to say skyscrapers. While his father put his name only on that one Coney Island development, he has stuck it atop luxury towers everywhere. His first trophy project, the Trump Tower on Fifth Avenue, is where he announced his campaign in June.

In Mr Trump's mind, his success moving the family firm from its middle class roots to the unabashedly luxury end of the market offers voters an important measure of his brilliance. “Dreaming about building a skyscraper and actually getting it built are two very different scenarios,” he noted. “I know the difference. I understand the value of a blueprint and that can carry over into many endeavours.”

The message is easy to discern. The 69-year-old Mr Trump is a can-do guy who can do for America, or, as it says on his cap, “Make America Great Again”. Yet if the old rules do ever reassert themselves, he may face a problem. The transformation of Trump Industries from socially responsible to high-society rapacious could equally be seen as a symbol of one of the things that gets voters most exercised: income inequality.

This same sense of anxiety sparked last year's furore about the so-called “poor doors” in New York City, where developers attach a few affordable housing units to new luxury residential buildings, but with separate entrances for the tenants occupying them.

Mr Trump is one face of a housing crisis that bedevils New York, where the focus on luxury projects has meant the shutting out of the middle class.

Mr Trump does have his name attached to two of the most cherished landmarks in the city, the carousel and the Wollman ice skating rink, both in Central Park. Yet disclosures filed last month with the federal authorities showed that even they are first and foremost about cash receipts.

Since it took control of attraction in 2010, Trump Carousel LLC has generated $600 000 at $3 a ride. The rink, though, did much better - $8.7m earned in 18 months. (Have $11.25 ready if you want to get on the ice.)

Meanwhile, a golf course built with city money on an old stretch of rubbish-strewn wilderness on the south shore of the Bronx has also drawn attention for the contrast it offers between the deprived neighbourhoods it abuts and its country-club sensibilities. “Trumps Golf Course, a Lesson in Inequality”, read a recent New York Times headline.

In future, it might serve Donald well to pay tribute to Fred, a man who leveraged federal government subsidy programmes to build homes for those who most needed them. But his problem is clear. He abandoned that mission in favour of building homes for people who most often don't.

THE INDEPENDENT