Broad-Based BEE. Jonathan Goldberg

Broad-Based BEE - Jonathan Goldberg


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In reality, the situation was vastly different.

      The chief was indeed accountable and his power was subject to checks and balances. This arose from the lack of any central apparatus through which absolute control could be exercised. An important safeguard against the abuse of power by the chief was the influence of his group of councillors, the amapakati or middle ones. The chief governed on their advice.

      Although he was head of the council, whether this applied to a chiefdom or a nation, he dared not veto a decision of his court except at the peril of his reputation and authority. Ubuntu-style management is a departure from hierarchically structured management and introduces a co-operative and supportive form of management in which the collective solidarity of groups is respected and enhanced.

      It is a social survival technique that developed from socioeconomic and demographic circumstances in which African people had to co-operate in order to survive.

      In creating a truly South African approach to broad-based BEE, society’s broader objectives need to be balanced against economic efficiency. It is necessary to recognise the diversity that exists in relation to culture, religion, ethnicity and other elements. The following “Afrocentric” worldview and cultural perspective has been adapted from an article written by Mr Shepherd Shonhiwa which appeared in The Institute of Directors King II Report:

      •Prizing spiritual “collectiveness” over the individual good. There is a communal way of life, where households live in an enmeshed interdependent neighbourhood. The “Eurocentric” way tends towards being disengaged.

      •An inclination toward consensus rather than dissension. Humility and helpfulness are more important than criticism.

      •Being non-discriminating and non-prejudicial, embracing reconciliation, as we have seen dramatically at a political level in South Africa and more benignly at a business level.

      •Fostering co-existence with others.

      •Inherently trusting and believing in the fairness of all human beings; a predisposition to universal brotherhood.

      •Observing close kinship through clan names and the extended family. Xhosa-speaking people will speak of their cousin-sister or cousin-brother.

      •Hierarchical political ideology, which is based on an inclusive system of consultation at all levels. This has been evident in labour relations and people management practices.

      •Perpetual optimism due to a strong belief in the all-knowing, omnipotent “creator of mankind”.

      It is important to understand the above cultural beliefs and openly recognise their worth and role in the process of engaging future partners and stakeholders. One of the biggest problems in implementing broad-based BEE-driven transformation has been the mismatch of parties’ expectations in terms of who does what and what each party gets out. Exceptions need to be acted upon within the context of a shared vision and objectively measured against consequences, and corrective action taken at the appropriate time and level.

      “If you treat an individual as if he were what he ought to be and could be, he will become what he ought to be and could be.” – Goethe

      A NEW LANGUAGE, MENTAL MODEL AND VALUE SYSTEM

      South African businesses need to become agents of change and undergo transformation because it makes good long-term business sense. There is a new language of “empowerment”, “partnering”, “team building”, “consensus-based decision-making”, etc. Compare this to the old authoritarian owner-manager paradigm where all major decisions were channelled through the owner-manager. (As the adage goes, it is like pouring new wine in old wine skins.)

      This is a period of fundamental change in the structure and culture of the business. Business leaders need to respond and commit themselves to a new future. It is a journey that will be shaped by the direction the incumbent owners and business leaders choose.

      The new broad-based BEE environment requires businesses to reassess their current business models as regards ownership, management and employment equity in terms of the composition of employees who control and manage the business, focusing on black people with regard to skills and development, procurement from black suppliers, investment in black-owned businesses, and increasing and redirecting socio-economic development spending to beneficiaries who are predominantly black.

      In some quarters criticism has been levelled at businesses which have not done enough to embrace the moderate approach taken by the government, despite having had many years in which to transform. The legislation and the Codes of Good Practice constitute a decisive approach to address this lethargy, rather dramatically, in a relatively short period of time.

      The handing over of control and influence over time must be viewed as a process rather than an event. When the degree of influence between the incumbent and the successor is too large and/or the developmental pressure accumulates, an event triggered by an external or internal source invariably results in disengagement, and possible conflict, potentially resulting in a hiatus.

      EMOTIONAL INTELLIGENCE IN LEADERSHIP

      Emotional intelligence has been described as the ability to sense, understand and effectively apply the power and acumen of emotions as a source of human energy, information, connection and influence. It provides a deeper, more fully informed understanding of oneself (human emotions – feelings, sensations and gut-level instincts) and, importantly, those around us.

      Emotional intelligence is important for transforming businesses, particularly for the people who lead them. We cannot disconnect emotions from intellect; in fact, emotional intelligence enhances intellectual prowess. The emerging models of business intelligence, particularly in relation to broad-based BEE implementation, are based more on emotional intelligence as the primary source of human energy, information and influence.

      The core elements of emotional intelligence in highly effective leaders, according to Dulewicz and Higgs, are the following:

      Self-awareness: The awareness of your own feelings and the ability to recognise and manage these.

      Emotional resilience: The ability to perform well and consistently in a range of situations and under pressure.

      Motivation: The drive and energy you have to achieve results, balance short- and long-term goals, and pursue your goals in the face of challenge and rejection.

      Interpersonal sensitivity: The ability to be aware of the needs and feelings of others and to use this awareness effectively in interacting with them and arriving at decisions impacting on hem.

      Influence: The ability to use insight and interaction to arrive at and implement decisions when faced with ambiguous or incomplete information.

      Conscientiousness and integrity: The ability to display commitment to a course of action in the face of challenge in order to act consistently and in line with understood ethical requirements.

      “People want more from their leaders. More integrity. More emotional openness. More innovative responses to the thorny problems of the day.” – Harvard Business Review, July 2002

      VALUES IN ACTION

      The core values of a business in relation to minimum behavioural standards such as integrity are inherently sacrosanct and are unlikely to change or be compromised. If we are to succeed in transforming businesses, then broad-based BEE aspirational values need to be integrated and embedded in the businesses. In fact, empowerment is likely to become a “permission to play” set of fundamental, strategically sound beliefs and values.

      In Built to Last – Successful Habits of Visionary Companies co-author Jim Collins suggests that, in addressing the accelerating pace of change, increased ambiguity and complexity of the world, “The only truly reliable source of stability is a strong inner core and the willingness to change and adapt everything except that core.”

      A business is said to have values only


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