B‑BBEE is one of the most complex, time-consuming and costly requirements of doing business in South Africa. It is by now a well-established and completely unavoidable criterion for success.
"Managing the journey to B‑BBEE compliance, and maintaining its growth, places a massive burden on company resources."
It's also a crucial pillar of sustainability, both for companies and the country.
As it is so imperative and deeply woven into the South African business paradigm, it is always on the company radar, touching all aspects of an organisation.
Managing the journey to compliance, and maintaining its growth, places a massive burden on company resources.
The complex, hazardous B‑BBEE compliance management journey
"Verification can be the difference between survival or failure for a business - score interpretation inconsistency can make the compliance journey perilous."
B‑BBEE compliance management poses four great challenges...
Ensuring accurate data is time-consuming and can be extremely complex. Data consistency must be maintained between the various internal silos, and throughout a compliance journey that involves many external role-players.
Adding to this are inconsistencies in the way that verification agencies interpret requirements and scorecards. Verification can be the difference between survival or failure for a business, so inconsistency can make the compliance journey perilous.
Legislation is constantly changing, requiring that companies keep up to date with the minutiae in order to remain compliant.
Lastly, and critically, there is the cost of B‑BBEE compliance, which can be stratospheric for many companies.
The levels of commitment and engagement required are obvious and high – not only in implementation but in measurement and reporting too. This requires an inordinate degree of organisational integration.
And there's more pain
If we look at the on-the-ground requirements of B‑BBEE compliance we enter an ever-changing world of risk, pain, stress and exhaustive detail.
"Even if B‑BBEE compliance is attained, the implementation can be so ineffective as to negate any hope of ROI."
The risks of not gaining the necessary level of compliance are myriad. There is the obvious financial and business survival risk of non-compliance. However, even if compliance is attained, the implementation can be so ineffective that it removes any hope of ROI for the massive effort and expense involved. Exquisitely accurate budget forecasting and management is required to keep the potentially astronomic costs down.
There are constant administrative pitfalls, such as the endemic problem of expiring B‑BBEE certificates, while finding or developing compliant suppliers can be a Herculean task.
To make things even more interesting, the B‑BBEE playing field can be charitably called 'dynamic'. Changing legislation from the DTI, sector charter adjustments, and changing data for the economically active population are just three examples of this.
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The real reason we need better B‑BBEE compliance management
The ramifications of B‑BBEE are, of course, far wider than company transformation. It aims to completely transform the economic reality of the entire country, envisaging business working hand-in-hand with the broader community.
Or, as foremost B‑BBEE transformation management expert, Dr Robin Woolley, a corporate advisor at Transcend, puts it:
"We have a belief in a bottom line approach to social activism in the employee base... designing a wider change process that activates understanding, involvement and commitment to a more transformed society."
His view is that a holistic approach is the most effective. This requires breaking down the barriers between what is considered a "business issue", the personal lives of people in the business, and the needs of society and the country as a whole.
This is ultimately the approach that will go the furthest towards achieving not only the desired economic transformation, but also provide real ROI from B‑BBEE compliance.
Software is the B‑BBEE management solution
The Holy Grail of B‑BBEE management is a single solution that can encompass all aspects of compliance, bringing digitisation and automation to bear.
B‑BBEE compliance management software – like Mpowered, the solution that Woolley implements and recommends – removes the complexity and human burden of B‑BBEE compliance, making it easier manage. It helps an organisation to stay ahead of interpretation issues, ensuring that all compliance efforts are aligned with verification expectations. It ensures a seamless flow of data, evidence and scorecards to all the necessary role players throughout the B‑BBEE compliance journey.
"The Holy Grail of B‑BBEE management is a single solution that can encompass all aspects of compliance, brining digitisation and automation to bear."
It also imbues the organisation with more structure, allowing it to more easily follow the right path to compliance, by creating a roadmap for everyone in the organisation. This encapsulates where the business needs to go and what it wants to achieve, by breaking down every element of what B‑BBEE compliance means for the business in practice.
In this way, by digitising, automating and optimising B‑BBEE compliance management, a solution like this helps a business to achieve its own aims, and ensures that the positive effects reverberate throughout society. As with so much other technology, the right B‑BBEE compliance management software can act as a catalyst for true public-private partnership and economic development in South Africa.