Poor management, not corruption, SA’s Achilles Heel – Ted Black

CAPE TOWN — Of 36 countries measured for youth unemployment by the Organisation for Economic Co-operation and Development (OECD) and StatsSA, South Africa stands at way more than double the average. We’re in the bottom 14 underperforming and badly managed nations. Management consultant guru and author, Ted Black concludes that South Africa’s problems have become too big for the ANC’s undisciplined and ineffective management to handle. The evidence is everywhere, not least in a nanny state, an impossibly bloated management cadre at all levels of government (and cabinet), and a government heavy on ideology and short on economic pragmatism. Forget 10 years of State-sanctioned corruption. Black puts his hope in Cyril Ramaphosa, but warns that unless he is able to make the poor productive and less dependent and builds a new generation of effective managers, a failed state is a real possibility. How quickly can Ramaphosa carve out more political space for himself to manoeuvre as Zuma’s imbedded forces, backed it seems recently by the EFF rally in advance of next year’s elections? Black says the ANC, with no preparation in exile or while fighting a guerrilla war, was and remains ill-equipped, to run a country. – Chris Bateman

By Ted Black*

In 2011, Tito Mboweni as Chairman of Nampak was sent a copy of a book called “The New Divide”. It was co-authored by Richard Pike, then CEO of Adcorp, economist Loane Sharp and me. The publisher wanted to call it “The New Apartheid” – a more fitting title – but due to an imagined need for political correctness, we funked it.

The book focused on South Africa’s huge unemployment problem and what to do about it. A source inside the firm said Mboweni’s reaction was to say the ANC isn’t interested in the poor. Whether he did express that view or not, events since 1994 certainly confirm the truth of it.

To this day, there has been not only a lack of political will to tackle the issue, but neither the Unions, nor the private sector promote the interests of the huge number of unemployed youth.

This was the picture in 2008 according to the OECD and Stats SA:

youth unemployment

Ten years later, the situation is worse. Youth unemployment is still South Africa’s biggest “Problem/Opportunity”. However, to tackle it, all political parties, especially the ANC, need to face reality.

One of the first things the Alcoholics Anonymous movement does for people who suffer from the illness, is to have you confront your problem head on. Until you do, you can’t deal with it.

The problem the ANC has is that its leaders, like most ideological politicians who promote a seductive, simple message to get them into power, were highly successful “troublemakers” with a noble cause. When the task of government was given them, they thought themselves ready, willing, and able to accomplish it. They may have been willing but certainly weren’t ready or able, and still aren’t. The way they go about things now, South Africa is too big for them to manage.

They inherited an economy badly damaged by the Apartheid years but one that, by world standards, was supported by well-run firms and institutions. Yet, after twenty-four years, as with other populist politicians, they still haven’t learned that governments don’t make resources productive – only effective managers do.

Read also: Hard work needed to counter SA’s criminal graft and poor management – IMF

SA Inc. today is like a company that hits white water and starts to bleed money and cash. That’s when the backbiting, finger-pointing, blame games, and internal politics take over. The result is ever declining performance until the firm disappears, or new management takes charge to attempt a turnaround.

With malevolent, corrupt politicians and other groups looking to stoke the fires of pernicious, destructive identity politics, we can only head one way. Until the ANC recognises the root cause – its chronic weakness in the discipline and art of effective management, it will continue to flounder by trying to correct “problems” of the past, and not to maximise future “opportunity” – the real task.

A recent report on the economic performance of nations by the McKinsey Global Institute, the research arm of the consulting practice – not the one that sends carpetbaggers from the North to flog high-priced “strategy” snake oil down South – points to a way forward.

Read also: ANC bleeding votes as service delivery failure bites – shock survey.

Out of 71 nations, South Africa is one of fourteen underperformers in a dodgy group of nations who come bottom of the list. It consists of Russia, Venezuela, Zimbabwe, and a bunch of other badly managed African and South American countries.

The top eighteen outperformers, led by China, are all Asian and represent perhaps the hardest working people on the planet. However, the key to becoming an outperformer is not just hard work, though it probably helps more than somewhat. It’s to harness brains.

To become an outperformer, you need a government with policies that promote growth based on productivity and the savings it can generate; improve civil service efficiency; enforce the rule of law; and encourage private sector companies to grow and thrive. That’s simple enough to understand isn’t it?

Not so simple to do, but a notion that works – unlike the many failed Marxist experiments in Russia, China, Cuba, Venezuela, Cambodia and wherever else in Africa and South America. For the most part, they have all been huge, unmitigated economic disasters accompanied by a massive cost in human lives.

ANC signage sits on display outside the Nasrec exhibition center in Johannesburg. Photographer: Waldo Swiegers/Bloomberg

In terms of the policies applied by outperformers, the ANC government has failed spectacularly on all counts. It’s why we are such an under performer and the bulk of our population remains unproductive. There are some root causes for its ineffectiveness.

Power in management comes from doing what’s legal – not to be confused with ethical – and from the formal position you hold. Formal power however is not enough. There is also power arising from the image people have of you – if they respect you or not. Then there’s networking with those who can influence your success. More positively, you may also have power from having options that high productivity gives you. In turn, these are a result of having the next three, most important powers of all.

The first of them is preparation power. Due to circumstance, it’s something the ANC never had. Managing is not easy, and you can’t learn to do it in a prison cell or by fighting a guerrilla war in the bush or on the streets. Then when you are in power, you can’t learn management in a classroom or at a business school. You may learn something about it, but not the how.

To compound the problem arising from lack of preparation, the party has shown a complete lack of moral power – doing what’s meet and right. Instead, its “cadres” at all levels (using the Communist definition of “loyal, trained workers”, not the prime one which is a “Key group of officers”), have behaved like a bunch of kids being allowed to swarm into a sweet shop to grab and trouser all they can. It leads us to the last and most important power of all.

Performance power that derives from the prime value an effective manager holds which is to focus on personal contribution. As the late Peter Drucker put it: “He or she asks, what can I contribute that will significantly improve the performance and results of the institution I serve?”

The person who acts with that value in mind, is top management, no matter what level in an organisation. The value of personal contribution usually applies to no more than 10% of managers in most corporations and probably a lot less in our government. In his huge cabinet, it means Ramaphosa may have around him, plus/minus five good ministers at most.

Read also: Managing a divided cabinet – President Cyril Ramaphosa’s central dilemma

So what should we focus on? Proverbs 29:18 is apt: “Where there is no vision, the people perish: but he that keepeth the law, happy is he.” The ANC lost its vision of a “Rainbow Nation” – if it ever really had it – and instead has become a huge bureaucracy with a mission to “take”, not “make”. Bureaucracies have “missions” but no “vision”.

And yet, wouldn’t all South Africans good and true, irrespective of race, want the country to become an “outperformer” … to become say, the most respected nation in Africa and one of the most respected in the World – the Vision.

And the Mission to move us towards the Vision … to be in the worlds’ top twenty outperforming economies by 2040?” Impossible? Maybe, but worth striving for.

To achieve it, there is a two-fold task that was as clear as dog’s bollocks in 1990 when Mandela was released and is even clearer today.

The first task is to make the poor productive, not wealthy.

The second task that will help make the first a reality, is to build a new generation of effective managers – not a huge bureaucracy that with dead hands throttles the creativity and effectiveness of the people who do the real work of finding customers and keeping them.

Read also: Time for Ramaphosa to get real: SA Inc’s balance sheet paints disturbing picture

Today, the ANC is like a typical, bloated corporate office full of people who, because they measure, think they manage but don’t. They should be supporting and easing the way for operating people on the frontline to create and keep customers – not getting in the way with bureaucratic red tape. You don’t “control” people to make them productive – you “release” them with clear tasks and the right support systems … the four things highlighted in the global report.

To do it we’ll have to shift from “problem” to “opportunity” – to focus on the doughnut, not the hole in it. And to move from vicious “Defend/Attacks” to asking better questions, listening to each other, and then cooperating and collaborating while we act on what needs to be done together.

If the late, great, wise and lovable Frederick Van Zyl Slabbert was right, then Cyril Ramaphosa is the man to move us onto that high road together as one, “Rainbow Nation”.

  • Ted Black runs workshops, and coaches and mentors using the ROAM model to pinpoint opportunities for measurable, bottom-line, team-driven projects. He is also a freelance writer with several books published. Contact him at [email protected].