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Sep 07, 2012

Building champions

Johannesburg|Port|Port Elizabeth|Africa|Building|MTN|Naspers|Old Mutual|Sappi|Standard Bank|Toyota|Africa|Europe|South Africa|Gordon Institute Of Business Science|Energy|Entrepreneurial Energy|Logistics|Rhine River|Bill Lynch|Infrastructure|John Paterson|Karel Pienaar|Nick Binedell|Operations|Maryland
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The image of corporate South Africa has taken a beating since the tragic events of Marikana. Equally, South Africa’s reputation as a beacon of hope and a potential investment destination, or gateway to Africa, has been knocked.

Without question, South African companies, together with government and the union movement, will need to engage in deep introspection about their roles in a society still afflicted by unsustainable and primarily race-based inequality.

However, all of us also need to retain a sense of perspective and we cannot afford to allow this period of introspection to descend into a cycle of depression-induced inactivity.

And if you are looking for an antidote to some of the corporate loathing and self-loathing going around, you could do worse than to dip into Going Global, a new 385-page book of essays compiled by Moky Makura in association with the Gordon Institute of Business Science (Gibs).

Subtitled Insights from South Africa’s top companies, the book tracks the development of 12 South African firms that have not only succeeded domestically, but have also managed to expand regionally and internationally.

It tells of how South African Breweries has evolved from a company producing 50 000 barrels of beer during its first year of operations after its founding in 1995 into the world’s second-largest brewer, which produced 218-million hectolitres and 200 brands of beer in 2011.

Then there is Imperial, which, largely through the entrepreneurial energy and drive of the late Bill Lynch, has expanded from being a small Johannesburg-based Toyota dealership into a diversified enterprise with operations in 18 countries. Its logistics business handles 100- million tons of cargo a year and is one of Europe’s leading inland shipping companies and a major force on the key Rhine river trade route.

Standard Bank, which is 150 years old this year, was initially built by Scottish-schoolmaster-turned-businessperson John Paterson from a beachhead in Port Elizabeth. But it now operates in 30 ountries (some of which it plans to exit) and has a market capitalisation of around R150-billion.

The book also reflects on the breathless (and currently controversial) expansion of African cellular giant MTN, whose first MD, Karel Pienaar, forecast, in a memo to staff, that MTN would have 350 000 sub- scribers by 2010. The prediction was off by hundreds of millions, with MTN having clocked up 129-million subscribers by that date – the memo, which was drafted in the mid-1990s, has been framed.

Similar tales of adventurous expansion are told about Anglo American, Barloworld, Dimension Data, Hollard, Naspers, Old Mutual, Sappi and Tiger Brands.

In the foreword, Gibs dean Professor Nick Binedell even goes so far as to argue that “few countries with an economy of our size (approximately $300-billlion) have incubated and developed global champions the way South Africa has”. He makes the further point that the ultimate contemporary South African challenge is “business creation”, without which it will be impossible to deal with the triple scourge of poverty, unemployment and inequality.

Published in the current climate, the book also surely raises the question as to whether enough is being done to set in place the framework for the emergence of the next generation of entrepreneurs – individuals who not only think and dream big, but who are empowered through society’s social and economic institutions and infrastructure to realise that ambition.

Edited by: Terence Creamer
Creamer Media Editor
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