On 12 December 2012, the current cycle will come to an end—according to the Mayan long count way of reckoning time, that is. Opinion is divided on what this will portend. Spiritual enlightenment ? Or apocalypse?
Doomsday scenarios aside, just what are the risks that companies and their boards should be factoring into their planning for 2012?
“In 2011, we felt a certain cautious optimism based on the fact that the recession seemed to be nearing its end,” says Michael Davies, managing director of ContinuitySA, Africa’s leading provider of business continuity and disaster recovery. “However, that now appears to have been optimistic.
The global economy is not recovering as quickly as hoped and our currency continues to be volatile—in fact, on balance, we think that the risks of social and political turmoil have actually increased. The danger is that hard-pressed companies may be tempted to cut spending on business continuity. However, given the risks and the new Companies Act, that’s exactly what they should not do.
“The good news is that the rapid maturation of business continuity hosting is making a much more sophisticated offering available. By tapping into the infrastructure-as-a-service model, companies can now begin to turn business continuity capacity from a dormant asset to one that generates value for the IT environment.”
Davies and his team at ContinuitySA have identified what they believe are the top-10 issues facing business in 2012 that are likely to impact on business continuity strategies.
1. Socio-economic challenges ratchet up a notch
Last year, it seemed as though we might be coming out the recession, but now the talk is all about the dreaded double dip. Economic hardship is exacerbating social and political tensions, especially as retrenchments swell the hordes of unemployed. Too many people without work or the prospect of it places a huge burden on the state, provides the climate for crime and is likely to fuel tension between the haves and the have-nots.
2. Government performance and service delivery still lag behind expectation
Ongoing service delivery and corruption issues have continued to fuel widespread social unrest. Some commentators are even talking about popular uprisings comparable to those that occurred earlier in the year in North Africa. Instability in the ruling party continues to unsettle political and social life, and this will only get worse as the ANC’s leadership conference approaches. Meanwhile—no doubt fuelled in part by the economic problems mentioned above—strikes and social protests seem to be getting more prevalent.
For business, one direct consequence is frequent work stoppages, with staff actually finding it hard to get to their places of work.
“It seems that South Africa is coming to a crossroads again, faced with the choice between the high and low roads,” says Davies. “We have to have confidence that our leadership will make the right choices but, meanwhile, prudence demands a renewed focus on safety measures, including proper business continuity plans.”
3. National infrastructure remains weak—and the middle class is feeling the pinch
While Eskom contrived to come through a very cold winter with relatively few blackouts, concern remains high as summer is the time for planned maintenance. Another concern is the availability of skills to maintain the aging infrastructure at Koeberg, and to operate planned new nuclear power facilities. On the positive side, recent moves to introduce independent power generation and green power into the South African energy market are welcome.
That said, there are worrying reports that lack of additional energy capacity at present is affecting the ability of some data centres to expand.
Other infrastructural challenges include the new toll roads around Gauteng and the new national health insurance system. While both are desirable, they are placing additional financial burdens on the middle class—i.e. the small tax base on which everything rests. Is the middle class coming close to feeling as squeezed as the poor and unemployed and, if so, how will it make its distress known?
4. Water remains a concern
Water security remains a problem in this country, exacerbated by the pollution of our existing water stocks.
Although the government finally woke up to the problem of acid mine drainage and made R400 million available, media reports indicate that little action has actually occurred. If substantial progress is not made in finding a solution, the acid water is expected to begin decanting into the Johannesburg basin in March 2012—it is already decanting on the West Rand. Companies with IT equipment in basements need to remain on high alert.
5. Worsening business climate
The risks mentioned elsewhere will continue to weigh on risk-averse foreign investors, while the volatility of the rand will encourage destabilising capital movements. The socio-political challenges we have mentioned are also taking their toll on the outlook of local business. With the business confidence index declining, investment in equipment and people will be curtailed at a time when they are more necessary than ever. Militant unions and demands for increases that are significantly above inflation are further worsening the business outlook.
With revenues under pressure, many companies will be tempted to skimp on business continuity but this approach is short-sighted.
6. Regulatory burdens and responsibilities increase
Promulgated during 2011, the new Companies Act has made the directors of companies personally liable for the outcome of their decisions. The legislation is new and untested, making compliance even more risky than it might otherwise have been.
In combination with the recommendations of the King Commission, the new act has made risk management a much more important item on the board agenda—and this includes IT risk.
Boards are increasingly accountable to all stakeholders rather than just shareholders. In this regard, environmental issues are becoming more prominent, which may add impetus to the move towards cloud computing, which has the effect of greening the IT department.
7. The sting in the supply chain tail
Recent natural disasters like the volcanic eruption in Iceland and the earthquake and tsunami in Japan have emphasised the flipside of global interconnectedness. In order to ensure business continuity, companies must increasingly consider their entire supply chains. Adequate consulting around the business continuity threats originating outside of the organization is imperative.
8. Cloud computing blurs vision
As predicted, 2011 saw considerable movement in cloud computing. While it’s clear that cloud computing has real benefits, non-specialist public cloud offerings should not be confused with specialist business continuity, which is also making use of cloud-based approaches.
“The need to have absolute quality assurance and security in terms of your business continuity remains, especially in light of boards’ enhanced accountability,” Davies notes. “On the other hand, the greater availability of bandwidth and improvements in technology are changing the model.”
9. Mobility is creating huge new data risks
The growing range of smart mobile devices, and the explosion in useful applications, has made mobility a fact of life. At the same time, there is growing awareness of the value of a company’s data, hence the emergence of “data as a platform”. Securing and backing up the corporate data on mobile devices usually owned by employees rather than companies is raising CIOs’ temperatures worldwide.
10. Business continuity is still not integrated into corporate strategy
Given the scale and magnitude of the challenges business faces, the danger remains that business continuity is marginalised and siloed. In many instances, financial pressures are causing companies to cut back on business continuity. For example, banks which have retrenched large numbers of people now have excess office space which they tend to use to provide their own workplace recovery—and this may lead to a business continuity solution that is less than optimal.
A related issue is that the long-term viability of smaller business continuity providers is looking less certain in this climate. We think this will prompt a “flight to quality” in many cases.
As indicated above, the emergence of new opportunities to remodel business continuity using a private cloud approach is a game-changer, offering cost savings, a much more effective product and the opportunity to get a return on your business continuity investment.
“The outlook is less optimistic than it was 12 months ago, and the ANC’s leadership conference during 2012 will unfortunately distract government’s attention from its real job. On the positive side, companies that understand the risks can plan accordingly—and troubled times also create tremendous opportunity for those with their wits about them,” concludes Davies.
A Conversation With Yourself Could Change Your Life
Thami Buti is a 24-year-old South African actor. He is amongst the 46% of South Africans between 20 and 50 years, who have no savings at all. He’s probably one of 90% of people who will retire with less than 50% of their income.
Except none of this is true for Thami, because he’s had a conversation with himself – at six different ages – in Sanlam’s new educational campaign.
In Sanlam’s Conversations with Yourself campaign, Thami gets transformed into a 20, 30, 50, 65 and 80-year-old (actor Hlumelo Mzimkulu plays the 10-year-old) called YOU. And over a series of conversations, these characters in their different age brackets sit and share wisdom on life’s ‘what ifs.’ Disrupting the traditional approach to ‘finance talk’, the central idea is this: what if you could learn everything you need to know about life, from yourself? What if 65 year-old you could tell you – at age 20 – to stop buying so many cappuccinos and to invest more into an RA? And 30-year-old you could ask you at 80 how many kids you have – and how you afford to give them the lifestyle and opportunities you want for them?
Sonja Sanders, Head of Marketing and Client Experience at Sanlam Personal Finance, says each of the seven Conversations with Yourself films uses humour and insight to broach a different topic – and presents the accompanying product solve. “For example, the Conversation on Life and Retirement tackles retirement in a completely new way. Planning for retirement is often not a priority when you’re young. But what if you knew only 6% of South Africans are able to cover their monthly expenses once they retire? And what if you could ask your 65-year-old self whether you are one of the 6%? Would 20-year-old you still take that year off? Would you at age 30 still buy that flashy car?”
Using banter to bring home the fact that today’s decisions will define life when you’re older, the script takes a notoriously low-interest topic and makes it relatable.
The same goes for the highly sensitive topic of death, which no one wants to talk about — undoubtedly a problem in a country with an average age of death that stands at 64 years, and where 40% of the workforce is more likely to have cell phone insurance than life insurance.
Sanders says, “Conversations with Yourself takes an idea we’ve all had to the next level: The wish to fast-track into the future to see if our lives worked out the way we expected. Ultimately, you are your own partner in life. Everything you do now either benefits your future or jeopardises it. It’s often too daunting to imagine one’s future-self. But Conversations with Yourself connects the future to the present, and makes the experience real and impactful.”
Related: How To Start Saving Money Today
South Africa’s problematic savings culture has been well documented. In the retirement space, Sanlam’s Benchmark research has identified millennials as the generation most at risk of having insufficient savings, mainly due to their DIY approach to money matters, their mistrust of financial service institutions and the fact that they don’t identify with retirement as a goal. It’s a generation known for overconfidence despite their poor financial literacy. Millennials prefer self-directed advice – so what better way to deliver it than through a ‘conversation with yourself’?
“As WealthsmithsTM, Sanlam wants to empower people with the knowledge and tools to enable them to make positive financial decisions today. This should set them up for success both now and into the future. Conversations with Yourself helps people to appreciate that the planning they do today has significant implications for their future self. Ultimately, the campaign uses progressive storytelling to share a story to which any generation can relate. The story of you,” concludes Sanders.
Visit Conversationswithyourself to watch the films and start your own conversation.
10X-e Partners With Alphacode To Accelerate Five Top Companies In South Africa
South African Scale Up specialists, 10X-e, will partner with SA’s premier fintech incubator subsidiary of RMI, Alphacode to support SA’s top Fintech’s on their path to scale.
This collaboration will initially see five of SA’s highest-profile fintech companies investing two years scaling up using 10X-e’s much lauded 10X program. 10X-e’s founder, Jason Goldberg, says that this accelerator program helps scale-up teams learn and apply the 12 disciplines for rapid and sustainable growth.
“We are delighted to be working with AlphaCode – SA’s premier fintech support brand – to help some of SA’s top Fintech entrepreneurs scale-up” says Jason.
The first five elite fintech businesses selected to join the program are Entersekt, Livestock Wealth, Click2Sure, Invoice Worx and Isazi Consulting.
“Globally leading mobile authentication and security specialists, Entersekt are set to be South Africa’s next ‘unicorn’ while Livestock Wealth is changing the investment landscape by offering the ability to own and manage your livestock via an app from Sandton (or anywhere), outsourcing all the dirty work to their specialist operators. Click2Sure was founded by Dan Guasco – the original founder of what became Groupon SA, and Isazi Consulting (who started already in late 2017)is led by one of SA’s leading teams of data scientists and artificial intelligence experts” Jason continues.
“Another accolade for this cohort is that three of the five businesses are majority black-owned tech ventures, and most certainly earned their place on the program on pure merit terms. We’re really proud to be supporting these globally competitive entrepreneurs.”
Jason notes that, even for elite entrepreneurs and ventures like these, specialist scale-up accelerators like the 10X Program can be the difference between scaling and failing.
“There’s no doubt that accelerators specialising in how to scale a business are invaluable for most entrepreneurs at this delicate stage in a business journey. Growth often kills when businesses cross a threshold of complexity not experienced before. Most great entrepreneurs are scaling a company for the first time. Fortunately, there is a defined ‘physics’ of rapid growth; rightly applying the 12 Disciplines of 10X Entrepreneurs – the heart of the 10X Program – you can dramatically increase the rate and sustainability of growth,” he says.
“We are dealing with the ‘crème de la crème’ of South Africa’s entrepreneurs dealing with the most extreme growing pains, so the need for guidance from seasoned Scale Up leaders who’ve ‘been there’ is key to both the success of the business and to its contribution to our economy. We look forward to helping these Founders navigate the Bermuda Triangle of growth successfully” Jason concludes.
The partnership with Alphacode will see game-changing support provided to these businesses worth around R1million over a period of 2 years as they are hand-held by industry experts on the treacherous path to scale.
Scaling – the Bermuda triangle of growth – is hard, and fraught with failure. Very few of even the top 1% of ventures succeed at scaling, mostly due to poor execution, due to lack of experience scaling businesses. The 10X Program brings the ‘Science of Scale’ and seasoned Scale Up Leaders to help founders navigate the Bermuda Triangle of growth
Our team has helped some of the Continent’s most exciting high growth businesses scale up through the most treacherous parts of the journey. We tailor make multiple workshops to the specific needs of you, your team, and your business. Our workshops serve to address the most pressing challenges that your business faces, helping remove the hurdles towards 10X growth.
For more information on the 10X Accelerator Program, visit: www.10x-e.com
Chairman Of Futureproof, S’onqoba Maseko On Instilling New Ways To Accelerate Our Youths
In the near future, traditional employment opportunities will no longer exist. SA needs to prepare our children for the fourth industrial revolution, now.
Futureproof is proud to introduce the chairman of our board, S’onqoba Maseko. S’onqoba received her Honours Degree from Wits University and is just three exams away from being a fully-qualified Actuary. The 31-year-old S’onqoba, originally from the banking industry, has previously filled several key roles at The First Rand Group, including; executive assistant to the Group CEO, Sizwe Nxasana and the head of the FNB Innovators Programme.
She is the founding COO of the Sifiso Education Group – a disruptor in the education space which also is the owner of Future Nation Schools. S’onqoba is also the Managing Director of an advisory and implementation consultancy for SMME’s called Perpetu8.
Naturally, combining her skills and experience with a passion for education and entrepreneurship has made her the perfect fit for Futureproof! S’onqoba believes that education is crucial. “It’s a game changer for the nation, the continent and the globe. It requires us to prepare children for an uncertain future in the best way we know how,”
“In a country such as ours, Futureproof instils the entrepreneurial qualities needed to not only run a business but to navigate through life,” S’onqoba continues.
The current education system does not cater to the needs of our local and global economy. In the time of innovation, our teachers are not equipped to deal with this change and soon enough, traditional employment opportunities will no longer exist. Speaking to this topic, S’onqoba says: “It’s not about only content – you can Google anything. It’s about skills such as critical and analytical thinking, creativity, communication, collaboration and technology”.
With the lack of skills available to prepare our country for the fourth industrial revolution, S’onqoba says that we need to find ways to unearth existing skills and to impart new skills that are more aligned to what industry and the country needs. “We need to reframe our thinking: we need entrepreneurs, technical specialists, technology whizz kids. We need creatives, thinkers and solution-orientated problem solvers”.
“We need to make school content and theory relevant to the current and future world. We need a curriculum, approach and a pool of skills that align to the world and the future predicted. Grade 1 learners this year will finish school in 2030. Are we teaching them what they will need to succeed?”
She believes that the high unemployment rate of our youth is largely due to a lack of skills. “We have so many job vacancies yet so much unemployment. We still have companies wich only recruit based on formal qualifications and see this as the only way to have the required skills. This is outdated, and the world is moving beyond it”.
With South Africa now in technical recession, S’onqoba stresses the need for the country to pull up its boot straps and get on with the hard work that needs to be done. “Our entrepreneurial ecosystem is not working as well as it should. It’s broken. We’re spending billions as a country whilst seeing very little impact and return of that investment”.
Caring for the needs of all stakeholders, S’onqoba believes that one of the reasons for Futureproof’s success and phenomenal growth is because the business simply ‘gets on with it’. “No excuses, no time wasting” she explains.
As a flourishing entrepreneur in a tough economy, S’onqoba shares some of her key learnings and says that an entrepreneur cannot survive without grit, curiosity and EQ: “Set up a business for scale from day one – think of your end state and build your business with that in mind. Recruit people who ‘get it’ and then develop them to be the best version of themselves so that they can add great value to your business,”
“Fill your board with passionate, skilled specialists who don’t only look to monetary income but are driven by passion, community and purpose. Manage your time like its money; in fact, it’s more precious”.
We need to build sustainable businesses that employ more people and grow in revenue and turnover. “We need businesses that embrace the future and technology to solve the problems we face in an efficient and customer centered way without legacy and an inability to innovate standing in the way.” she concludes.
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