A business consultant is advocating an Afro-centric approach to business that he says will help see South African companies through the current global recession.
Even though ratings agency Fitch recently announced that South Africa is handling the global recession and credit crunch “quite well” compared to its international peers, the economic struggle is far from over, says George Fosu, chief financial officer at Akanani Consulting.
He believes that taking a recession lightly is a grave error, particularly in a society such as South Africa, which is already characterised by acute socio-economic dislocation.
South Africa has witnessed the effects of a combination of high unemployment, structural poverty, high personal debt and competition for economic resources at a community level, and within a corporate context, market contraction has resulted in predatory pricing strategies, staff retrenchment and severe cost-cutting initiatives.
Whether the country faces a recession or not, catering to the narrow self-interests of a company concentrated just on surviving is wholly inappropriate for long-term growth and is entirely contradictory to an Afro-centric approach to business, says Fosu.
If Africa learns any lessons from the global economic downturn, Fosu believes that it should be these: firstly, in recession, down-turn or economic up-swing, the manner in which the world has conducted business must change, and this paradigm shift can already be observed; secondly, and most importantly, Africa cannot wait to be instructed as to what that new business paradigm should be. The continent has the skills, drive and experience to establish its own business approaches which are informed by the African culture and the African context.
“An Afro-centric approach to recession, for example, adopts a broad approach that embraces the interests of the wider community of economic stakeholders, for example, staff, customers, suppliers, community leadership, shareholders and so on, right across the value chain,” explains Fosu. “By using dialogue to identify and craft superior solutions, it is possible to tackle urgent business issues.”
The central thrust of an Afro-centric solution is the shared interest in the sustainable well-being and development of the company and its economic community of stakeholders. It recognises that we live in an inter-connected society and that solutions which give priority to inclusive engagement engender strong bonds of loyalty and would provide enduring competitive advantage and superior returns in the long-term, compared to business approaches that cater for narrow interests, he says.
From a macro-economic perspective, Fosu believes an Afro-centric approach would help to reduce the negative side effects of economic recession by giving businesses greater resilience and therefore less likelihood of contributing to South Africa’s socio-economic challenges.
“African businesses can weather the recession or a more competitive economic environment by focusing exclusively on win-win propositions that are of real value to the organisation’s wider economic community,” concludes Fosu. “In this way, not only does the company continue to the next phase of its lifecycle, it continues as a contributing corporate citizen.”