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With South Africa’s economy under intense pressure and the fallout of socio-political uncertainty impacting significantly on investment, the business climate is volatile to say the least. However, while most companies are holding back on spending and are looking to save, the reality is that it is a mistake to overlook the critical importance of workforce management solutions to optimise processes and optimise businesses in tougher times in particular.
This is the view of Guenter Nerlich, MD of AWM360 Data Systems, a provider of human capital management (HCM) focused workforce management solutions.
Nerlich agrees with the broader market sentiment that the economy reflects stagnant to no growth (0%) and this is has put a block on investment. He also agrees that many international businesses are reluctant to invest further ‘on home soil’ and are looking to rather extend their operations and businesses abroad.
The air of apprehension that has engulfed most sectors is beginning to smother industry, strengthened by political infighting, discourse and disharmony between key stakeholders including Finance Minister Pravin Gordhan and President Jacob Zuma.
There is also growing concern over the country’s ability to avoid an official financial downgrade by global rating agencies.
So as complex as the situation may be and as serious, the reality facing businesses is that they cannot afford to hold back on investment in technology.
“You must spend money first to save money,” says Nerlich. “A major part of the problem is that many companies are on a knife-edge – they feel trapped by the economic difficulty and become immobile, which is very dangerous. The fact is that during times of difficulty and volatility, businesses must be proactive and not sit back… sitting on the proverbial fence is not an option,” Nerlich says.
Investment is the backbone of an economy and when there is restriction, there is contraction – it squeezes the life out of investors, according to AWM360 Data Systems and this is very worrying.
“Effectively South African companies are sitting on capital that would otherwise be spent on investment. What we are advocating is that businesses free up their capital and commit to investment in solutions that boost workflow and reinforce HR and systems and directly contribute to the bottom line earnings, that is an investment in the future,” Nerlich continues.
He believes while South Africa’s labour force continues to feel the pinch of economic hardship and resources become more scarce, the need for solutions that optimise work systems, help businesses handle data, analytics, cloud migration, the Internet of Things and digital transformation, will only increase.