According to a report recently released by the Boston Consulting Group, although South African companies are leading the way in supporting economic integration across Africa, their continental growth plans still face many challenges.
32 companies based in South Africa, including, Discovery, FirstRand, Sanlam, Standard Bank, Massmart, Woolworths, Famous brands, Shoprite, Naspers, Sasol, MTN and Dimension Data, are leading the drive across the continent.
The characteristics shared by the successful organisations leading the economic integration include expanding their business by means of mergers and acquisitions, the establishment of local ecosystems and greenfield investments.
One of the biggest challenges faced by these businesses is growing and retaining local talent. Unilever retains top talent by offering competitive pay packages, benefits, and technical training. Morocco’s OCP Group is partnering with Universities such as Columbia, MIT, and HEC Paris to train new talent with the establishment of The Mohammed VI Polytechnic University. Tanzania’s METL Group plans to grow its workforce over the next four years from 24 000 to 100 000 by providing training and development support programmes within the countries they operate in.
Other challenges businesses face are the distance between major regions and fragmented trade zones, combined with the onerous VISA requirements
In Africa, the average distance between major cities is 4100 km, with an average flight time of 12 hours while in Europe the average distance between major cities is 1300 km with an average flight time of 3 hours. Furthermore, there are 6 trade zones across Africa within those trade zones, 80 countries require visas. Europe is divided into 4 trade zones, no visas are required and North America has one trade zone with 9 countries requiring visas.
Moving talent across the continent, and ensuring all the VISA requirements are met, is an expensive and time-consuming task. As a continent we could go a long way to growing our economies, developing our local talent and ensuring that ideas and best practices are shared by improving the ease at which companies can move their top talent between their various African businesses.