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Black business must take advantage of pressure to excel

Picture Credit: uprootdev.co.za
Picture Credit: uprootdev.co.za

When Mahatma Gandhi said "be the change you want to see in the world", he might as well have been referring to the challenges black entrepreneurs face in SA today.

As entrepreneurs and job creators, black-owned businesses have a responsibility to dispel the "entitlement" generalisation of black people and become active participants in the transformation strategy.

Black businesses have an important role to play in ensuring that the transformation and empowerment strategy facilitated by Broad Based Black Economic Empowerment (B-BBEE) is successful.

In his state of the nation address in 2014 President Jacob Zuma announced that in the next five years the country would enter a new "radical phase" of economic transformation.

Come May 1 2015, compliance with the revised B-BBEE codes will become compulsory.

The undertaking by the government is geared towards creating an enabling environment for previously disadvantaged black people.

The important question is: are black entrepreneurs adequately prepared to take advantage of the mounting pressure for change? How do they maximise the opportunities presented and create a new legacy?

First, there must be a change in mindset among black business owners. They must understand that they are an integral part of the economic transformation journey.

As contributors to this empowerment process, their approach to business has to be creative and global in outlook.

B-BBEE is merely an enabler, but black business owners have to be competitive to survive in a marketplace that is not a sheltered localised market.

Black business has to answer important questions. How is it differentiating its value offering? Is it looking beyond its local business environment for best practices?

Professionalism and excellence can no longer be optional; the stakes are high for black business to dispel the stereotype that it is mediocre.

Being black in SA at this point in our history comes with huge responsibility, as one represents everyone who is black.

Second, black businesses have to expand their network of support, mentors and influencers that can expose them to wider networks and opportunities. Thinking locally limits the information base and potential of business.

Generation of referrals, opportunities for joint ventures and tapping into fellow business colleagues' databases are some of the benefits of getting together with like-minded people.

Having a blinkered and localised view of the market is not helpful in a world that is continuously evolving.

Third, black business folk have to develop strategies that set them apart from competitors. Considering that big business generally confines black businesses to the "lower" rungs of the supply chain ladder, it is imperative to be innovative and break the mould.

Black business tends to be concentrated in similar businesses and industries, rendering itself exposed to competitive pricing instead of value-based procurement strategies and decisions.

B-BBEE should be understood, first and foremost, as a means of helping unlock value within businesses and not as a means of splitting the economic pie into smaller pieces instead of growing the pie.

This requires creative thinking and embracing change. Growth and sustainability of business is through continuous evolution and innovation.

The private and public sectors are compelled to cooperate in aiding transformation, and their inclusion of black businesses in their supply chains can only work in their favour.

Diversification is integral to strengthening a company's supply chain. But black business owners have to come to the party and make it work.

l Joseph is the chief executive of the SA Supplier Diversity Council (SASDC)

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