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B-BBEE transformation savvy

By April 29, 2021No Comments

Sound advice for companies yet to walk the B-BBEEE road

While B-BBEE is incredibly important for businesses operating in the South African environment, achieving a B-BBEE status often requires extensive investment from the organisation in question. Local business process outsourcing (BPO) solutions provider, Merchants South Africa, was the first BPO provider of its size to achieve Level 1 B-BBEE status, just one year after achieving level 2 – despite the current economic environment in which many businesses are facing loss of revenue and income.

BBQ caught up with Sydwell Shikweni, Transformation Director at Merchants (a customer experience partner and BPOprovider)to find out how they did it. The company last year became the first BPO provider of its size to achieve achieved Level 1 B-BBEE status.

When aiming to achieve a Level 1 B-BBEE status, what is the importance of working hard on B-BBEE elements that do not require extensive financial investments, especially during tough economic times?

Tough economic times call for ‘no box’ thinking rather than ‘out of the box’ thinking. It is my belief that B-BBEE programmes that are implemented in line with the overall business strategy will always yield better returns and enable the business to grow while transforming. The most effective methods towards achieving sustainable B-BBEE credentials are centered around, among other things, investing wisely in resources, time and talent to ensure resilience for the business and the beneficiaries to our efforts. Resources can be in the form of cash or other physical resources like equipment, which can go a long way to address business needs.

“I believe that responsible transformation drives inclusive competitiveness and sustainability while driving continued opportunities for employment.”

Talk to us about your experience working with enterprise development suppliers in a way that grows their business and provides opportunity, and then graduating these suppliers back into the value chain of the business.

Enterprise development, when approached thoughtfully, should deliver strategic and commercial benefits to the business. It starts with effective selection of beneficiariesto be developed and supported, which has to be purposeful and target beneficiaries who will fit into the supplier value chain and result in a mutually beneficial partnership.

This will allow the business to enable accelerated growth, financial and operational independence, and sustainabilityforthesebeneficiaries. For example, as part of our staff feedback, we found that our employees were interested in receiving safe, reliable transport to and from the workplace.

We provided capital assistance to our transport beneficiaries in the form of interest-free loan to enable them to purchase commercial vehicles cost-effectively, thus setting them up for success. We then graduated them into supplier development and structured contract which allowed us to provide reimbursement for unoccupied seats to make the relationship commercially viable.

This enabled them to be resilient during the different phases of their business, including tough economic conditions, thus enabling continued employment and answering a need from our employees.

What is the importance of engaging the leadership team and employees in B-BBEE plans to ensure support at all levels?

The success of any transformation endeavor requires a collaborative effort with key stakeholders – and leadership teams and employees are key internal stakeholders in this regard.

Leadership should collectively develop the transformation vision, set the objectives and ensure strategic alignment with all the employees at various levels of the organisation, throughout the various phases during implementation.

Employees drive the implementation of transformation within the business, but they need to be clear on their role in order to do this effectively. During the transformation journey to level 1B-BBEE at merchants, input from our employees contributed significantlyto identifying strategic areas for investment.

Talk to us about the importance of forecasting and planning in terms of B-BBEE, and having an effective monitoring tool to track progress each month?

The B-BBEE legislative landscape is constantly evolving. Therefore, remaining up-to-date with developments in the transformation sector and engaging with key stakeholders is key to success.

Forecasting and planning essentially provides the road map for a business’ transformation journey = and should not be underestimated when looking to improve your B-BBEE credentials.

The periodic review of our transformation efforts serves as a feedback mechanism for assessing progress made and sets the agenda for further focus areas – driving the business toward continual improvement in this regard.

What is the importance of analysing procurement spending patterns in the business, and engaging non-compliant suppliers in terms of building their B-BBEE credentials?

Balance in the supplier mix is imperative and contributes towards the diversity of supplier profiles in line with broader transformation objectives. In driving the Merchants business forward, I paid specific attention to non-compliant suppliers.

The first step is to understand why the provider is non-compliant = is it through an audit, a lack of interest, or a lack of knowledge, for example. The approach to engaging with these suppliers will differ depending on their specific circumstances.

In most instances, we find that the closer we engage with these suppliers, the more they realise that they have an important role to play in the transformation of their businesses, which can contribute to economic transformation in the country. Not only does this journey allow us to work with more compliant suppliers, but positions our suppliers to be more competitive in this area.

Merchants engaged 89 students into its workforce in 2020 – what is the significance of engaging in youth employment services?

There are many challenges facing youth in South Africa, and certainly no single solution that will address them all. The Youth Employment Service (YES) is a business-led initiative supported by the Government, which serves as a catalyst for addressing the growing challenge of youth unemployment.

We see the youth notes problem to be solved but we see the youth as an opportunity to tap into the abundance of talent we have in South Africa- particularly in a contact centre environment where we can provide opportunities for graduates, school-leavers and those without previous experience.

Costella, G., 2021. B-BBEE transformation savvy Sound advice for companies yet to walk the B-BBEEE road [online] Black Business Quarterly.

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