Standards improve structure, governance and assurance, while business owners can tap into useful SEDA and enterprise supplier programme funding grants, writes Muhammad Ali, MD of World Wide Industrial & Systems Engineers (WWISE)
Broad-Based Black Economic Empowerment (B-BBEE) will always be a topic of hot debate in South Africa.
Depending on an individual or organisation’s political leanings, it is viewed either as a positive or negative, with few grey areas in-between. Though BEE compliance is not compulsory for private businesses, the government’s transformation policy makes it near impossible for firms to obtain licensing or bid for tenders without meeting stipulated BEE requirements.
Yet what many private sector companies – particularly those falling into the Qualifying Small Enterprises (QSEs) category – fail to recognise, is that complying with transformation targets can be achieved through effective implementation of standardisation policies and practices.
QSEs are businesses with an annual turnover of between R10-million and R50-million and are scored on the B-BBEE elements of ownership, skills development, management control, enterprise and supplier development, and socio-economic Development.
Should they meet certain transformation targets, they are eligible to qualify for grants from the Small Enterprise Development Agency (SEDA) of up to R100 000, as well as other enterprise funding programmes in the country.
QSEs are highly prevalent in manufacturing and engineering, ICT and telecommunications, as well as construction and real estate, and can benefit greatly from standards set out by the International Organisation for Standardisation (ISO), the international body responsible for setting uniform standards for companies and organisations across the world.
ISO standards help these industries meet regulatory requirements, improve governance, and assure clients of their commitment to quality and safety – all key factors in securing BEE-qualifying work.
Government frequently needs construction firms and subcontractors on its projects that adhere to safety, environmental and quality standards, or automative, food processing and packaging suppliers and manufacturers that demonstrate the ability to deliver quality and safety through ISO certification.
Similarly, ICT service providers highly skilled in data protection have a fantastic opportunity to win contracts from corporate and government clients.
There are several key ISO standards that businesses should look to implement if they wish to qualify for BEE work. These include:
- Quality Management (ISO 9001): Ensures that products and services consistently meet customer and regulatory expectations.
- Risk Management and Compliance (ISO 31000): Helps businesses manage and mitigate operational risks effectively.
- Health and Safety (ISO 45001): Critical for industries where workplace safety and compliance with labour laws are key concerns.
- Environmental Management (ISO 14001): Necessary for businesses looking to manage their environmental impact and comply with sustainability regulations.
- Data Security (ISO/IEC 27001): Essential for IT companies and other sectors handling sensitive information that need to protect client data.
QSEs should begin implementing ISO standards as soon as possible, particularly if they aim to pursue government or large corporate contracts, as early adoption positions businesses to meet BEE tender requirements. Since the ISO implementation process can take anywhere between three and six months, it is essential to start during expansion planning or as part of a long-term growth strategy.
The process begins with an initial assessment (gap analysis), followed by planning and resource allocation and actual implementation. During these phases, the necessary policies, procedures and systems that emerged from the gap analysis are put in place.
Among these are process mapping, staff training, infrastructure upgrades and internal audits. Once the QSE is confident that all processes comply with the ISO standard, an accredited certification body needs to be engaged to conduct a formal audit.
The certification body will assess compliance, issue the ISO certification, and provide recommendations for continuous improvement.
It stands to reason that many internal changes will occur within the QSE as the standard is implemented, but all will put the company on firmer footing to bid for BEE-qualifying work.
Inevitably there will be improved documentation, detailed record-keeping and enhanced staff training on the new procedures, especially in areas of quality control, safety and risk management.
However, it is vital that an organisation’s management team actively drives a culture of continuous improvement, with regular internal and external audits becoming ingrained in the business routine to maintain ISO certification.
These changes will help ensure the business stays structured, accountable, and compliant, which is crucial for securing BEE-qualifying work and long-term sustainability.