11 Dec 2019
Business Out of the Ordinary
Out of the Ordinary insight into today's world of business, from Investec Private Banking
Sir Richard Branson, Investec's Fani Titi, Takealot's Kim Reid and Emma Wade-Smith join Redi Tlhabi to discuss the impact of AI on business, the need to reinvent education and the role business has to play in society.
Business Out of the Ordinary
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- RT: Redi Tlhabi, journalist and moderator
- RB: Sir Richard Branson, founder Virgin Group
- FT: Fani Titi, Joint CEO, Investec
- EWS: Emma Wade-Smith OBE, Her Majesty’s Trade Commissioner for Africa
- KR: Kim Reid, founder and CEO, Takealot.com
On making your own optimism
Redi Tlhabi: Business is an Adventure, but we live in such a turbulent world, there is so much uncertainty. Business is an Adventure - I almost want to add but it is also a challenge. What reason do you have to be optimistic about anything, about business?
Richard Branson: I was born an optimist, and, and I think it's a fortunate thing for everybody to try to be optimistic, but you also have to make your own optimism to an extent.
So many, many years ago, I would come to South Africa and I would go and see the Minister of Transport and try to get permission to fly here. And every time they would say to me, ‘Richard, yeah, we really would love you to fly, South African Airlines really needs competition’, and then I would leave and then a year later I come back.
And on this occasion, I went in there and the Minister said ‘Richard, we'd really like you to come there, I think the world of your airline, you know it would be just great for South Africa’, and I knew I wouldn't hear from him for a year.
So I went outside the building and I got our press team who had come down with me to throw the biggest press conference we could and we thank this Minister for his foresight in wanting us to come and compete and by the evening, he'd given in and Virgin Atlantic, you know ended up coming here. So, you need a bit of the gift of the gab as well just to try to push these things through and make your own optimism, I think.
Trade in Africa
RT: A lot of the times it is said that trade in Africa is not for sissies. So, can you share with us some of the epic challenges and fulfilment, I guess of selling this part of the world as the appropriate place for commerce and development?
Emma Wade-Smith: Yeah. Thank you. I think I'm a huge optimist as well and as I travel all across the African continent, I just get so inspired by what's happening here - the innovation, the inspiration, the motivation, the drive everywhere across this continent and I think the opportunities really are boundless.
But of course, there is a challenge in that, I do think that doing business in Africa is no different to doing business anywhere else in the world. So, if we say that doing trade in Africa isn't for sissies, I think doing trade anywhere in the world isn't for sissies.
I think it's about being brave and courageous and following your passion and I think what I see everywhere I go is this extraordinary opportunity for bringing British innovation and entrepreneurship together with African innovation and entrepreneurship and the combination of that is fabulous to see.
The rise of online shopping
RT: Let me bring you in here, right. Here we are, Takealot.com, it's disruptive. You saw something in society, and you thought I'm going to bring about change…
KR: Trade may not be different across the world, people aren't different across the world, so if you look to China, you look to the States, you look to the UK, online shopping is something that's just become part of people's lives.
Online penetration in the States and in the UK today is upwards of 14-15 percent, China is sitting at 18-20 percent. So, when we started the business, we looked at it and we said there's a great retail market, online penetration of retail in this country was nothing, so we saw opportunity and that's why we started to build it.
Lessons in leadership
RT: Fani, let me bring you in here. You know, we talked about the world and the uncertainty, I imagine, that running a business like Investec, a dual-listed company in the UK and South Africa. You've got to be open to change, you've got to be open to innovation, but it's not just about change right? It's about when do you bring that change?
Fani Titi: You have to take into account that standing still is not an option. I think we live in a world that is very disruptive, by its very nature, so you have to embrace risk, you have to embrace different opinions. So, at Investec we have a very flat structure, we try to rely very much on the people that are on the ground because they know best what trends are coming our way.
We take the view that wisdom is not the preserve of the leadership of a business. We rely heavily on every individual that that works at Investec. We rely on their ingenuity, we rely on their spirit of enterprise, we rely on their level of ownership of what we do. So, we’re always changing, we’re always challenging ourselves, we’re always asking what could we do differently? How could we do it better?
RB: Yeah, a leader I think is a good listener. I mean the worst leaders, the leaders who are always doing, always talking and not listening. And so anyway, I couldn't agree with you more.
I'm afraid this coming year is the 50th anniversary of Virgin. And in that time, we've set up, over 20 completely different companies in different sectors and so on. And if we had actually stayed 50 years ago with the record shops that we had, we would have been bankrupt, so we keep reinventing ourselves all the time and we have a lot of fun in the process and we don't stick to one sector.
We preciously value the brand and we look after the brand and the teams look after the brand and make sure that every new thing we do is, you know, is the best in its field.
Why businesses need to get a grip on data
RT: Kim, what would you say constitutes the 'out of the ordinary' right now that you think is going to disrupt business?
KR: Yeah. I think it's something that's been spoken about a lot lately, which is artificial intelligence. I think artificial intelligence in the world is going to change not only business, but also the world in many ways. When we look at business efficiencies that you can get out of AI, I think that businesses who are not going to adopt artificial intelligence in the short to medium term are really going to struggle in the longer term to actually be competitive.
And I think that's going to change a lot of what's in the world and I think that businesses need to get to get a grip on data, particularly, and understand how they're going to use this data or how they're going to actually accumulate data because businesses with more data are going to fare better than businesses without that data because that data, you know, fuels the machine learning and artificial intelligence algorithms.
The impact of AI on jobs
RB: I completely agree, except that we do need to deal with what the effects are going to be on people, because I think people will benefit from health, from education, from safety in cars, a whole lot of things. But there is the danger that is going to cost jobs and so I think companies and governments have got to start thinking about, you know, if AI comes in how are we going to make sure that people are employed.
I think that 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 on a five-day working week on a maybe a three-day working week.
You could argue that new jobs will be created in different areas and so on, but I just don't think there's going to be enough new areas and therefore we need to think about that.
EWS: It really is about embracing the future, embracing technology because with the best will in the world we're never going to be able to build the thousands of schools, the thousands of medical clinics and train the tens of thousands, hundreds of thousands of nurses and doctors and teachers that we need to be able to provide the lifelong learning and skills for our workforces, not just for today but for the future.
And so we need to embrace that technology that will enable us much more easily to be able to face that future and find ourselves with meaningful jobs.
The human connection
RT: Fani, you also want to come in here. Tell us the Investec story because I would say that the human connection is also so pivotal, and Richard you talked about it earlier that inevitably or maybe it's not inevitable, people will lose their jobs. How do we position ourselves?
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, because if you're dealing with issues of money, issues of investment and lending money over a 10, 15, 20 year period, you need more than just data.
So, our view is that the choice between, on the one hand human connection and on the other technology or data that is a false choice. We believe in doing both. We believe that we can be high touch on the one hand and high-tech.
FT: Obviously, we have to make sure that our education in this country improves dramatically, because if we do not do that technology or the lack of understanding of technology will be a competitive disadvantage as we go forward.
KR: So, if I look at where we are today in South Africa, technology is coming whether we like it or not, there's going to be AI, there's going to be machine learning, there's going to be things that change. So, if I was a government in South Africa today, I'd be looking at education, particularly, and we've all spoken about it and all mentioned it and focus particularly on Maths and Science.
RB: Yeah. I couldn't agree more on the education front despite being a somebody who left school at 15.
We've got a lovely place in Franschhoek and, and we went into the area that was not so lovely in Franschhoek and we visited four schools and you know the first class we went into all the kids were sitting on the floor, they couldn't afford a seat.
I think if you live in an area or if you have a business in an area, you really have to draw a circle around your business and then you have to make sure that the schools, the clinics and all aspects, you care for and then those circles will start overlapping and you can start working with neighbouring businesses to lift up the local community.
This will ultimately be in the business's interest because you know if you can lift people's standards, then they're likely to use your products more. So, my very strong feeling is governments are not perfect, pretty well anywhere in the world, and business has really got to step in.
EWS: I think disruption is the key word here. And I think it's how do we re-imagine education? I think, you know, for me 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 and you sitting in front of a blackboard or whiteboard anything like that, that's education today and it's not working for us.
So, you're thinking about how you do education out of the ordinary, actually, it's being able to beam education into everybody's homes and everybody's offices. So for me, the first step I would do is I would invest in the telecoms and bring 5G, globally. You’re supporting what a number of companies are doing to provide
that around the world, because that to me is at the heart of how we provide a skills population for the world that we are creating.
RB: Just going back to what you said, Maths and what did you say Science? Yeah, so I would have left school at 14 if Maths had been the number one thing at school, you know, so I mean obviously, look there's 10% of the population where Maths and Science, you know, they're cut out for it, and that's fantastic, they should have the best Math and Science education there is.
But for the vast majority of kids at school, you use the words re-imagining 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, you know, where they can be in touch with nature, in touch with environment, you know, a whole lot of different areas.
And also, where you can bring out the individual kid's passions, and so if it is Maths and Science, you know, you should go for that. But if not, I think that for the other 90% they.... we should be allowed to do other things.
KR: I think slightly differently again. I think everyone can learn Maths and Science. I think it's about the quality of the teachers.
RB: It depends. I think it does depend what you're going to do with your life. I mean, 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. I thought the gross was my profit and the net was my turnover, so it wasn't great news when I finally discovered about it.
I was taught to add up, subtract and multiply, now that didn't need to take me 10 years at school to learn those things and for my profession as long as I can add up, subtract and multiply and divide maybe but you know, I'd prefer to multiply.
You know as an entrepreneur you don't need to have spent eight, ten years becoming a Maths expert, if you're going to be a mathematician or a scientist then okay.
FT: Yeah, I just wanted to say that having taught mathematics at University, I do agree.
I do agree that we complicate studying a lot. I think in the new age that we've got to make technology more accessible and use the power of the internet to connect people. I think demystifying on the one hand mathematics, demystifying on the other technology and things like coding is really important, the mindset change.
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