It is a well-understood fact that economies need entrepreneurs in order to grow. Entrepreneurs don’t just build new businesses – they create jobs, they build new supply chains, they innovate, and they invigorate healthy competition. Start-ups and SMMEs also have more room for growth than big, established companies, which are more limited by the prevailing market conditions. Africa is a continent of entrepreneurs who embody the Shared Value tenet of seeing business opportunity in the midst of struggle. The truly successful, growth-driving entrepreneur is someone who is focused on the opportunity, who operates with purpose and who taps into what their market needs.
Investment in entrepreneurs, whether financial or in skills development and door-opening, is an asset to big business as well. It comes up again and again at the regional Africa Shared Value Leadership Summit and other events centred on purpose-led business and sustainability: the ecosystem in which a company works is key to the company’s survival and success as its internal operations. The most obvious place for a company to look when re-evaluating its relationship with entrepreneurs is in the supply chain. Having a wider pool of capable suppliers to rely on makes a business more resilient and sustainable for the long term.
In the case of TATA Africa, investing in entrepreneurs by selling them genuine TATA parts at a discounted price to broaden the network of suppliers for their end consumer. They also trained these entrepreneurs in the maintenance and repair of their vehicles in order to ensure that a non-functional truck or bus can get back on the road as quickly as possible. In South Africa, they can reach a broken truck or bus in less than two hours. This has enabled TATA Africa to create a bigger network of touchpoints across Africa, making their vehicles more attractive as consumers know they will be able to find genuine parts and trained mechanics wherever they go. In addition to creating more buyers for TATA parts while supporting small businesses, this investment also positions TATA as a leader in reliable commercial vehicles on the continent.
Banks, such as the KCB Group and SVAI Founding Members Absa, have also invested in entrepreneurs – a valuable well of potential market expansion. For example, KCB has created a business account that is tailored to SMEs and entrepreneurs, giving them access to financial services in a way that matches their financial needs. This is just one of the ways that the banking group are supporting entrepreneurs and building their client base in East Africa. For Absa, investing in SMMEs has become something of a priority area. Among their project are tailored funding solutions for entrepreneurs and small businesses. From an accessibility standpoint, even the language used to describe these offerings is straight-forward and free of confusing jargon that would exclude those without formal training or experience. Even these simple examples demonstrate the value that entrepreneurs can bring to an organisation, not only as suppliers but also as consumers themselves.
This is a fundamental part of any Shared Value strategy. The aim of implementing Shared Value solutions is to make the entire ecosystem conducive to driving growth and creating profitable outcomes for the business. This includes the business environment, which thrives when entrepreneurs continue to innovate, create new ways of doing things, and fill the small to medium ecological niche that supports the existence of bigger organisations. The many ripple effects of a successful entrepreneurial venture go further beyond the direct impact this has on shareholders or even other businesses in the ecosystem. Business needs to embrace entrepreneurs and entrepreneurial thinking as the future of business, invest in supply chain development and use Shared Value thinking to reframe KPIs and measurements to de-risk funding and support of SMMEs.
In many ways, all businesses should be like entrepreneurs: we must stay connected to our passion and the social challenge that the business was created to address. Even big businesses started out from someone recognising a gap in the market, a need that was not being addressed. Now we must take this attitude and direct it with purpose, innovating and scaling the ideas that not only create economic value, but also generate value for society. That is the basic principle of true Shared Value.
Next month, bookings will open for our fourth annual Africa Shared Value Leadership Summit. We have added the word ‘Leadership’ to the title to emphasize how the event has grown into a seminal event in the business calendar on our continent, even in such a short time since its launch in 2017. In 2020, the Summit will take place in one of our continent’s success stories and one of the world’s fastest-growing economies – Rwanda – where we hope that this spirit of growth and the insights shared by our roster of speakers will inspire new connections, conversations and commitments to driving our continent forward. To learn more, visit our website: www.africasharedvaluesummit.com.
Onwards and upwards!
CEO, Shared Value Africa Initiative