EconoBEE Newsletter – November 2006

A New Business Environment

If you were to go to New York City and decide to open a fish and chips shop in lower Manhattan, and call it “The Osama Bin Laden Best Fish Shop”?, you would probably lose your money. Everyone knows that it would offend most of your potential customers. If you were to go to Israel, and open a pork butchery next to a synagogue in an exclusive Jewish area, you could also expect not to make a profit.

Every country has its own set of norms and acceptable behaviour. I could give thousands of additional examples like if a female were to go to a business meeting dressed in a bikini, it may be acceptable on the Australian Gold Coast, but certainly not in Saudi Arabia.

I raise this point because a couple of weeks ago I had a meeting with a large multi-national and the director told me that whenever they enter a new country they go through a process of understanding the new environment. Let’s call the company Giant Multi-national Corporation. They recently invested in Oman (a country in the Middle East) and they produced a policy document called “The Omanisation of Giant Multi-national Corporation”?. They do this whenever they enter a new country, so presumably they also have a policy called “The Australianisaton of Giant Multi-national Corporation. “These policy documents covers all aspects of the country – its social norms, to its business norms and everything else in-between.

It’s no wonder that they have a South Africanisation of Giant Multi-national Corporation” document which covers our own local issues. I was assisting them in understanding the BEE issues that they will face when they do business here. The director accepted what I said without interrupting too much. He understands that each country has its own quirks – his aim is to ensure his company manages those quirks and hurdles to optimise the company’s profits.

I have no doubt that all multi-national companies do similar things. They set out to examine the potential profit they can make in any country and work out what they need to do to live like a good corporate citizen in their new country.

Why don’t local companies do the same thing?

I started looking at how smaller South African companies approach BEE. In many cases they put their head in the sand, like the proverbial ostrich. What our own South African companies do not realise is the political and business environment has changed. They live and work inside this country, and maybe have not realised the change that has taken place. I’m not only referring to the BEE act, but all aspects. It is a slow change and from one day to the next nothing seems to change – it’s just like watching the hands of a clock. It does move but you can’t actually see it move.

South African companies are doing themselves a disservice by ignoring the change that is happening. In many cases there is too much emotion around the issue for managers to think clearly.

We had a potential client who runs an air-conditioning repair company call us and ask what is necessary to become “BEE Compliant”?. We told him it is a process, firstly of education and then to start changing his business, by making good business decisions to increase his BEE levels. We explained that he can learn most of what he needs in a 4 hour BEE workshop, costing R650.00 and then to be aware of the issues from then on.

His reaction: “I employ 10 people – I’d rather close down than go through this process, and then they will be unemployed”?. Looking at it rationally – he is prepared to close down a business (not sell it) to spite someone? Who is going to care? Some other air-conditioning business is going to get more business!

The conclusion is clear. Each business should examine the environment in which they operate just like the Giant Multi-national, and react accordingly. To help you change accordingly we have organised a wonderful half day workshop.

Winning Hearts and Minds

Steve Banhegyi & Associates together with EconoBEE is presenting – “Organisational Culture and BEE” – Using change management technologies to generate enthusiasm and dispel fear.

BEE as opportunity or threat? Any talk of change in organisations can have far-reaching and often unintended consequences. This workshop looks at the people or ‘soft’ side of BEE and how to use modern and ancient change management technologies to reinvigorate your culture and turn BEE to great organisational advantage.

Attend this workshop and find out how to gain the support of all your staff.

You can get more information by visiting our website or downloading an informative brochure.


New codes delayed

The finalisation of the BBBEE codes has been delayed again. Cabinet has asked the dti to simplify the codes further. They have set a new deadline of December 2006 to get them published. This however should not stop companies from trying to make an effort to comply. This is a long term project. The current codes that we have does give more than sufficient information for companies to comply fully.

Once the new codes are published we will let all subscribers know. We will also have all copies of the new codes available for download and a dedicated section for comments on our website.


How to answer BEE Questionnaires

Companies send these forms out in order for them to get an idea of what your current BEE score is. The majority of these forms are long (sometimes 12 pages long). Your customer needs the answer because your BEE score is essential for them to be able to complete their own BEE scorecard.

Since your customer has sent you the form you should not ignore the request, but fill it in or at least give some sort of response. If you do not have a scorecard send them an acknowledgement. Tell them that you are a broad-based BEE company who is following the current Codes of Good Practice. Mention the size of your company and whether you are a QSE (Qualifying Small Enterprise) or Generic company. Give them a commitment towards BEE. The commitment is your intention to improve your BEE score over time and that you will always use the current codes.

Preferably you should send them:

  • An actual BEE Scorecard

  • Your company’s BEE profile and strategy

  • Your targets for a future scorecard and how you plan on achieving them

The scorecard is easy to produce and you can do the work yourself. You will also gain a good understanding of how BEE works and the way forward for your company.

Your profile and strategy should very clearly show your intention towards BEE. It should also give a brief description about every indicator where you can or did score some points. If you give names of projects or people in your profile it will make it considerably easier for your customer to interpret.

If you need help with answering questionnaires, please email us. We have vast experience in compiling all the necessary documentation.


Ask the Expert BEE Forum launched

We have introduced a free forum on our website. It is designed to help you ask questions about BEE and other  related topics and get answers from experts in the field.

That’s it for the time being.

Keith and the EconoBEE Team

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