World Entrepreneur Day: Time For ESD To Rediscover Its Purpose In Technical Capacitation Of SMMEs

By Larisha Naidoo, Head of Anglo American Zimele

South African corporates have been running enterprise supplier development (ESD) programmes for years, helping to create thousands of SMMEs, who have often thrived and become employers in their own right. 

However, we often overlook the accountability that these programmes ought to demonstrate to the communities we serve. 

At Anglo American Zimele, we have seen first-hand how our supply chains impact the lives of the people that live around our mines – they don’t just create relationships between big businesses and small businesses, they have the power to create opportunities for communities to uplift themselves.

It’s a responsibility that we cannot take lightly. We must rediscover our purpose, and now more than ever, our development work means training and developing people and SMMEs with this purpose in mind. This means that we must talk to our supply chains, our communities and our youth to understand where the opportunities link to development and economic transformation. 

We must then collaborate with partners across the ecosystem to actively connect beneficiaries to the available opportunities. This will go a long way towards fulfilling the promises we make to our communities.

This accountability to our communities and their developmental needs means we, as ESD providers, must constantly evaluate the relevance of our programmes to achieving our purpose, which is, in our case “to reimagine mining to improve people’s lives”. Our programmes must evolve and apply lessons that we have learnt along the way to improve the effectiveness of our service offering. Feedback from our communities and partners implementing our programmes should therefore form a cornerstone our interventions. 

For example, our supply chain partners continue to highlight the mismatch between available opportunities and the capacity of small businesses that apply to exploit that opportunity. In many instances, SMMEs often lack the technical skills needed to deliver on the contracts that they have secured. On the other hand, communities continue to communicate the challenges faced by small business owners on the ground, especially relating to their abilities and skill sets. These include their struggle with managing costs, being overlooked for tenders that they are capable of delivering and that they also have limited access to information. 

We therefore need to find better ways of responding to the challenges faced by these small businesses, particularly so that the lack of technical skills, incorrect pricing, cashflow or funding issues, limited access to information and incapacity to tender successfully can be appropriately addressed. 

In order to address these gaps, Zimele has brought new partners on board including the SA Institute of Chartered Accountants Enterprise Development (SAICA-ED) to help community-based SMMEs to improve the financial management systems, manage their finances and costs effectively and ultimately run effective operations, grow holistically and become sustainable. 

To meet the demand from our supply chain partners for more technically strong suppliers, which would make them more competitive in the tendering process, we’ve partnered with Caliba to design and implement a training module that makes SMMEs more equipped to tender effectively, price correctly and better understand contract management. 

It’s all about increasing our beneficiaries’ skill sets to run more robust, competitive and successful businesses. 

When considering the role Zimele can play to close the technical gap, we have also piloted a programme with Tjeka FET College which involved technical training for managers, supervisors and key technical staff for selected suppliers to our operations. This was done with an aim to enable our beneficiaries to deal with complex issues that are key to a successful delivery of their construction projects, including technical competency of their staff, supervisors and management and complex project management support.

Networks and partnerships are key to everything we do and if we add “accountability” to that we will have an opportunity to make a real difference. Being part of Anglo American’s commitment to sustainability allows Zimele to leverage the enormity of the group’s resources and networks to create partnerships that allow for change and impact. 

If we look back on the past five years, Zimele has supported a total of 7 544 jobs, trained and mentored 1 224 entrepreneurs and youth, and 236 enterprises have acquired contracts and purchase orders worth R1.61 billion – 73% of these from Anglo American. In addition, Zimele disbursed R283 million in loan funding to 112 businesses to enable them to deliver on contracts they had with Anglo American. 

It’s also important to be purposeful in the way we impact the youth and women, whether in terms of specific technical skills, business skills, entrepreneurial development or employment opportunities. As a result, we’ve introduced a start-up service offering that is targeted at women and youth entrepreneurs. 

Taking into account the importance of integrating our youth development efforts with implementation of the ESD programmes, we have undergone a step-change in recent years to train the youth in areas that are specific to the needs of potential employers. Providing broad skills in a certain area will always be useful, but to ensure that our suppliers provide opportunities that the youth can take advantage of. We have to match these opportunities with specific skills that these suppliers need to be more competitive. The bottom line is that we have to be deliberate in closing the existing skills gaps in small businesses if we are to grow and develop youth. 

Together with our partners, we’re seeing how ESD programmes that are driven purposefully can have a transformative effect on communities. They drive effective skills development that leads to meaningful work, and build small businesses that themselves become employers as they win more tenders and are able to grow. 

A case in point is the Bakwena Sabenza Scaffolding, a woman owned and led business based in Rustenburg that has grown in leaps and bounds through the intervention of the Zimele Supplier Development Programme.

With over 200 employees – up from 80 before the company enrolled into the programme – the company now has a positive impact on the community with a multiplier effect of five, according to Kedisaletse Motlhakoe, director of the company. At least 50% of these employees are youth.

This multiplier effect that we see through small businesses thriving can only happen if we are purposeful. That’s the only way we’ll start living the true promise of ESD to flatten the inequality curve in our country and make a real difference. 

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