Business Is An Adventure 2019

Key takeouts from the panel discussions

• How Diversity Builds Business Advantage

  Panel 1: Thando Hopa, Faith Popcorn, Dr Marc Kahn and Dr Tashmia Ismail-Saville, with Claire Mawisa moderating.

  On the benefits of inclusion

   

  FP:  It’s not a choice anymore. These are such unordinary times. You need an unordinary everything. When there’s diversity in the boardroom, business goes up 35%. When there are females in high levels, business does so much better.  When we talk about diversity we mean mixing black and white, male and female. But that’s just the beginning. Gender fluidity is absolutely the future.

   

  When people talk to me about gender fluidity they say “Why do we have to do this?” Well, it's because people want to be recognised in bringing their whole selves to work.

   

  Investec, in saying you have to be unordinary and to be human in these inhuman times is a most gorgeous mission.

   

  On the potential of the youth

   

  TI-S:  Youth are going to be your future customers, employees, custodians of the SA econ and the world economy. Currently, 6.7 million of these people, over a third, are completely locked out of the job market and that often translates into a lifetime. Some sobering stats: an unemployed person costs the country R1.2 mil over a lifetime.

   

  If we don’t put these young people into work, that will cost us R7.9 trillion as a country. They have the potential to be brought into the workforce and be contributors.

   

  Within youth, there's a massive diversity… grads, semi-skilled, but we’ve learned through research …A company called Tata took underprivileged youth from slum communities to bring them into coding courses. They did psychometric testing on the youth and tested them against MBA students, and on aptitudes around ambition, and on particular subjects like science, etc, they matched and in some cases, these young people surpassed the results of the MBA students.

   

  So there’s this massive potential sitting among this 6.7 million, and the Youth Employment Service is here to unlock that and bring them into the world of work.

   

  On one's personal experience of diversity

   

  TH:  People seem to believe that diversity and inclusion are the same thing but they really aren’t. Diversity is when you are dealing with perceivable differences – age, gender, race etc. Inclusion really requires you to look at change structurally, attitudinally,  behaviourally.

   

  What I noticed in my career was that people would think “we have this model who has albinism and she’s on the cover – so tick” that diversity and it’s fine but it’s symbolic. Inclusion requires you to hone that voice and allow that voice to participate in that sphere. So I think there is a lot of education that is still needed.

   

  On whether diversity drives business growth

   

  MK:  The real debate is around inclusion and belonging because it’s not enough to have representation. Just because you’ve got the right percentage of different types of people in a team, does not mean you’ll have an improved team function or better outcomes and decision making.   It is important but it’s not enough.

   

  What is required is a culture of inclusion and belonging. It’s only then that the interaction of those differences can come together in a productive way. It’s a common mistake to think that you have women on the team, you have a person of colour, etc so let’s get on with business as usual – that’s a fail.

   

  The first step is to get the representation but the real hard work is to have a leadership that builds an environment where that difference can have a voice and is not marginalised.

  Diversity is when you get invited to the dance, inclusion is when someone asks you to dance and belonging is when you dance madly because you don’t care who is watching.

   

  On future gender trends

   

  FP:  Facebook recognises 71 genders! Does that mean I have to have 71 bathrooms? No, it means you have to have one bathroom.

   

  The clownfish. My favourite fish. The top clownfish is the female. Second-in-command is a male. When the top female dies, the male becomes the top fish and automatically turns into a female. That’s a great model for the Fortune 200. That's fluidity.

   

  It may not be the way you think, but it’s the way millennials think. That’s a market of $46 billion. Do you really want to skip them? And they don’t want to be pigeon-holed. - 28% of millennials don’t want to be identified by gender, and they want to be respected for that. You’re going to try to ignore this, but it’s not ignorable and you’ll come into a lot of friction and conflict.

   

  On how business views young employees

   

  TI-S:  We get businesses that were originally very fearful of taking on the youth, now coming back to us and saying, “Wow they have brought us such fresh thinking, they pick up on things so fast and they have taught us things on how to modernise the business,” so if you set expectations, if you turn people into heroes and give others the opportunity to allow great ideas to come out, you can turn that mindset around of what it means to bring youth and diversity into your organisation.

   

  On whether human resources in South Africa are progressive

   

  MK:  Since 1994 South Africa has been focused on race and for the most part we are role models for other international businesses on that front but the unintended consequences of that focus are that we have lost focus on other forms of difference. So a lot of the times it is about the cultural context and not about identifying and targeting different groups - although we have to do some of that as well.
  

• Business Out of the Ordinary

  Panel 2: Sir Richard Branson, Fani Titi, Kim Reid and Emma Wade-Smith OBE, with Redi Tlhabi moderating.

  On why business is an adventure and why being optimistic is important

   

  FT: At Investec, by definition, we bring a mindset that there is opportunity even in difficult times. We need to find ways that we can manage the risks and back the opportunities we find.

   

  RB: I was born an optimist. You need a bit of the gift of the gab to push things through and make your own optimism.

   

  On the challenges of Africa as an investment destination.

   

  EWS: Doing business in Africa is no different to doing business anywhere else in the world. They say doing trade in Africa is not for sissies. But the fact is, doing business anywhere is not for sissies. It’s about being brave and courageous and following your passion.

   

  What I see everywhere I go is this opportunity for bringing British innovation and entrepreneurship together with African innovation and entrepreneurship. And the combination of that is fabulous to see.

   

  EWS: Too many people are not aware of the reality of Africa today. The history – the headlines – are enduring in people’s minds. And once you start talking about the reality of Africa and the opportunities we see across every sector in pretty much every country on the continent, then you start to get people very excited.

   

  On when to introduce change in your business
  

   

  FT: You have to take into account that standing still is not an option in today’s disruptive world. You have to embrace risk and different opinions.

  
  FT: Wisdom is not the preserve of the leadership of a business. We rely heavily on all the people in the business.

   

  RB: The worst leaders are leaders who are always talking and not listening.

   

  This year is the 50th anniversary of Virgin and we’ve got over 20 completely different companies in different sectors. If we’d stayed as a record company, we would have been finished by now.

   

  Sometimes you’ve just got to look for opportunities and jump in where you think you can improve things.

   

  On artificial intelligence

   

  KR: I think AI is going to change business and the world. When you look at the efficiencies that you can get out of AI, businesses who aren’t going to adopt AI in the short to medium term will struggle in the longer term to be competitive.

   

  I’m not being a futurist, I’m being a pragmatist now. Businesses need to get a grip on data and figure out how to accumulate the data. Businesses with more data will fare better because that data fuels machine learning and AI algorithms.

   

  RB: We do need to deal with the effects of AI on people. I think people will benefit from AI in health, education, safety in cars, but there is the danger that it’s going to cost jobs.

   

  Companies and governments have got to start thinking about if AI comes in, how are we going to make sure people are employed? People most likely, if you go forward 20 years, they’re going to need to get better at looking after their own leisure time. Companies are going to have to pay them the same as they would for a five-day working week on maybe a three-day working week.

   

  We are going to have to make sure that people have the ability to enjoy the fact that they are going to have 3-4 days holiday a week.

   

  You could argue that new jobs will be created in other areas. But I don’t think there’s going to be enough new areas [for job creation].

   

  What must South Africa do to do business differently?

   

  EWS: It really is about embracing the future and technology. With the best will in the world we are never going to be able to build the thousands of schools and medical clinics and train the hundreds of thousands of nurses, doctors and teachers that we need to be able to provide lifelong learning and skills for our workforces. So we need to embrace the technology that will enable us to be able to face the future and find meaningful jobs.

   

  The power of the human connection

   

  FT: What we do as a business is not unique, we don’t produce products or widgets, so what makes the difference for us is how we do what we do and the experience that we give to our clients and the level of trust and partnership that we can bring.

   

  If you’re dealing with issues of money or investment, you need more than just data.

   

  Our view is that the choice between human connection on one hand and technology or data on the other is a false choice. We believe we can be high touch and high tech. Through the human connection we can do more for our clients.

   

  We do invest heavily in technology, but our aim is to use tech to innovate and improve the relationship that we have with clients. Use technology to empower the human to better serve our clients.

   

  On education

   

  KR: Technology is coming whether we like it or not there’s going to be AI, machine learning, things are going to change. So, if I was in government in South Africa, I would be looking at education with a focus on Maths and Science.

   

  Put education close to the youth. Put great schools in townships. There are two simple things: focus entirely on education and transport.

   

  RB: You have to draw a circle around your business and make sure that the schools and the clinics – all aspects within that circle – you care for. It’s not just relying on government to do these things. And then circles will start overlapping and neighbouring businesses can work together to lift up the local community. And ultimately if you can lift peoples’ standards, they’re likely to use your products more.

   

  Governments are not perfect anywhere in the world and business has really got to step in.

   

  EWS: How do we reimagine education? The future of education is our living rooms, our kitchens, it’s our co-working spaces, because we need to use technology to keep learning.

   

  Sitting in front of a whiteboard or blackboard is education today and it’s not working for us. So, thinking about how you do education out of the ordinary, is about how you beam education into everybody’s homes and everybody’s offices. So, for me, the first step is to invest in the telecoms and bring in 5G, globally. Because that to me is at the heart of how we provide a skilled population to the world that we are creating.

   

  RB: I would have left school at 14 if maths had been the number one thing at school. There’s 10% of the population who are cut out for maths and science and they should have the best maths and science education there is. But for the vast majority of kids at school – Emma, you used the words reimagining education, I couldn’t agree with you more – we need to try to make school a place that people enjoy, where they learn about the real things that are going on in life, and where you can bring out the individual kids’ passions. If that is maths and science, that’s great. But for the other 90% we should be allowed to do to other things.

   

  FT: Having taught maths at university, I agree that we complicate studying a lot. We’ve got to make technology more accessible and use the power of technology to connect people.

   

  KR: I think everyone can learn maths and science, I think it’s about the quality of the teachers.

   

  RB: It depends on what you’re going to do with your life. I didn’t know the difference between net and gross until I was 50 years old, I’m dyslexic, and yet we managed to build quite a big group of companies.
  

• Q&A: The Future

  Panel 3: Sir Richard Branson and Stephen Koseff, with Redi Tlhabi moderating.

  On optimism

   

  SK:  I was listening to how Richard built his business because he was an optimist. Optimism is important. Now what we perhaps didn’t factor in when we had Ramaphoria was the kind of devastation that took place… the GDP cost to South Africa during the Zupta era.

   

  If we grew, by what we were growing at, pre- the crisis, which was 4-point-something percent, we would have had an extra R1.3 trillion of GDP today, and when Tito [Mboweni] would have been talking about his budget, we’d have been looking at ratings upgrades, because for every rand of GDP you get 28% tax, roughly, so they would have had in excess of R300-billion of additional revenue. And that is why growth is so important and that has been our historic fight.

   

  If you took that extra R300billion (and every year it’s a number –  not the full amount) you’d have had Debt to GDP at 30%, you’d have unemployment probably at 16%, and you’d have had a totally different country. We’d have made a lot of progress.

   

  Now [Ramaphosa] needs to make some tough decisions – and the first thing I’ve been saying for months is: Number one – fix Eskom! It took them a long time to come out with their plan. The plan is there. Now execute it and you have to bring private capital in; you can’t put that whole burden on the government balance sheet; we can’t afford it. Use any word, don’t call it privatisation. Call it public-private partnerships, call it anything. But just do it!

   

  On how business can manoeuvre in tough times

   

  RB:  Firstly, there are companies like Investec that care for their society, while there are an awful lot of companies that don't and say it’s the government’s job. And to transform a company in 15 months is an impossibility.

   

  The most important thing you have about this new government is a leader who’s honest, and if you don’t have a leader who’s honest, it just ricochets all the way down through society, the police force, the customs officers etc… and so [Ramaphosa’s] had to move this big ship around, into a different direction – it’s tough but I wish him well and I feel a lot more confident investing in South Africa with him at the helm.

   

  SK:  Just on the point of leadership, I had one of the ambassadors of one of the larger European companies come to me the other day and say, his mandate from his president is to help Cyril Ramaphosa.  So if you went, as we did in the old days, to the World Economic Forum, with the previous group, it was not very comforting. When you go with Ramaphosa, you’ve got a leader -  he knows his way around.

   

  On how long South Africa has to wait for economic plans to be implemented

   

  RB:  Welcome to Britain, to America, Italy, Portugal … Honestly, that’s why business people have got to step in.

   

  SK:  Leaders have to give people hope, and be proactive in society. I heard Richard say you need to put a circle around the environment you operate in and help uplift people and through that intervention, you start to get growth.

   

  Obviously, we need an enabling environment and we need a government that is business-friendly. It’s up to us as business to do a lot more to help uplift people, but it needs a difference in attitude from business to say, “This is our country, we can make a difference.” Why wait? Just pick up the ball and run with it. We as a society need to work together as a team.

   

  RB:  A government is a group of people who, generally, may have only been in their job for a year or two, or as with most governments around the world, only want you to be in it for a year or two.

   

  So, they need help. Businesses are generally around for a very long time, and a lot of them are very entrepreneurially-minded. So it’s not just helping in the community that’s important for business people, but also to help governments.

   

  On addressing youth unemployment

   

  SK:  If we don’t do that, we’re going to fail as a society. Education is key. What we’re trying to do with YES [Youth Employment Service] is get the jobs inside the environment, inside the villages and townships so that they don’t have to spend 40% of their salary travelling. We’re trying to create an ecosystem in the environment.

   

  RB:  We’ve stopped asking people who apply for a job at Virgin about their exam results. We don’t want to know their school results or university exam results. We’ll do an in-depth interview, they’ll send a video in, we’ll find out about their life skills. 

   

  There are people who are good at learning facts at school, (and there are people who are not), but it doesn’t mean they are going to be the better employee. Our feeling at Virgin is that if every company stopped asking for school results, then schools would have to reinvent themselves. They would have to turn people into human beings and look at all the other areas.

   

  On climate change

   

  RB:  Every business has a carbon footprint. Taxing businesses for their carbon footprint hasn’t worked… so how can we resolve this problem without taxing carbon?

   

  Our idea [when we brainstormed with other entrepreneurs] is that we work out our carbon footprint, and governments say that based on your carbon footprint, a percentage of your turnover or profits – we’re refining it at the moment - must be invested in clean energy.

   

  Now, we’re not taking your money – and this is the government speaking – we’re not taking your money and losing it in the government coffers. You’re able to invest this in solar, in wind, in Memphis meats, which is a new alternative to eating beef. You know, planting forests.

   

  But you can also make profits from it. You can get dividends from it. And if every company in Britain did it, you’d have billions and billions and billions going into clean energy. We’d speed up the whole process.

   

  And it seems to be a win-win for everybody. From the public’s point of view, if you’ve got more clean energy than dirty energy the prices are going to come down and they’ll stay down forever. That’s the lovely thing about the sun and the wind.

   

  The governments benefit because they’re actually whipping climate change and they’re not taxing people heavily. And companies benefit because they can actually get their money back. Anyway, that’s an entrepreneurial idea that we’re trying to push through.