So says Dionne Kerr, managing director of Siyakhana Consulting, a black-owned consulting firm focusing on development solutions with public and private sector organisations.
Speaking at a breakfast presentation to top corporates in Sandton, 26 November, Kerr said: "There is little doubt that BEE acquisitive activity is steadily increasing. In 1995 there were 23 BEE transactions with a rand value of R12.4 billion according to Ernst & Young's Mergers and Acquisitions report. In 2003 this has grown to 189 transactions with a rand value of R42.2 billion. However to maintain the current level of activity, the funding requirement over the next 10 years would have to be in excess of R400 billion."
In spite of the growth Kerr says there are still negative perceptions that see BEE as a concept that will stifle economic growth. "BEE should not be seen in isolation as a yoke that is in opposition to sound business principles but rather as an integral part of business strategy that can make a significant contribution to the growth of organisations and their profit margins.
"We've seen this happen in practice in our work with clients," she says. Indeed, research shows that companies that have addressed and actively implemented BEE are 40% more profitable than those that have not addressed BEE.
Kerr cautions that there is no quick fix in BEE. It requires dedication and commitment. "The concept of BEE is a mammoth undertaking that asks us to readdress every single way in which we do business and who we do business with," says Kerr. "And all the while we still have to meet the same targets in terms of profitability and market share and we still have all the pressures of operating a business."
Kerr notes that many companies are still struggling to embrace BEE as a strategy that can add value to their organisation and its balance sheet, and that can slot comfortably into all the other operational areas of their business.
"There is a common misconception that the only means of achieving compliance from a BEE standpoint is ownership. Fundamental to BEE's success is the realization that ownership is by no means the exclusive means of achieving compliance and that embracing the fundamentals of skills development, creating and enhancing black business and supporting our communities will be used as measurement to determine BEE compliance."
She makes the point that the whole concept behind BEE was never meant to create a black elite or to exclude any particular race or gender. "It is meant to increase access to skills and opportunities for black individuals."
Of interest, according to a local emigration expert, is that there has been an increase in
enquiries from black professionals looking to obtain visas for residency offshore - outside of SA. Their predominant reason: that BEE has excluded them from being able to participate at a strategic level through expertise rather than influence.
She says human resource development is a particular key imperative in the process to long term successful empowerment. It is therefore imperative that a positive BEE strategy is complimented by a strong focus on personal growth and development in order to ensure its sustainability.
"This means in effect, if a specific sector provides skills training, we reduce the cost of acquiring skills, we increase the size of the pool and the necessity to head hunt is reduced because there are readily available skills on the market. It also means at a certain point all the dedication and commitment pays off when your staff become fully competent and fully capable and are able to participate at shareholder level."
Kerr says, encouragingly, that the level of available skills is increasing. To put this in perspective, 5069 black students graduated between 1994 and 2004; 998 Black candidates qualified with an MBA and at present there are about 1871 black CA's, compared to just 300 in 1994.
She does however caution that training does not mean throwing money at black employees. "This only leads to a lack of loyalty, poaching and problems with succession planning.
"Ultimately BEE is not just about strategy - it's about implementation and seeing how real benefit can be derived for your organisation."
