Thought Leadership Article

Exciting times – harvesting our youth dividend

Legislation and other Government interventions may assist in transforming our society into one in which the limitations on each individual’s success are only self-imposed. A more important element to a nation’s success, however, is that those who have gained experience and expertise take proactive steps in using those assets to invest in society’s future – our young people. We examine the opportunities this represents.

 

Senior South African economist, Cees Bruggemans poses provocative thoughts and questions in his recent article ‘SA Radical Prospects: Limitations & Opportunities’: “It can be said, in all earnestness, that the modern South African economy has never been given a fair chance to show what it is truly capable of, in both the productive and the distributive sense. Could we make it our first priority to use the proceeds of resource windfalls to beneficiate our human capital stock? Should we in the future make our own luck through foreign trade by participating more aggressively in global value chains?

Can we break our previous development ‘mould’ (relying mainly on resource windfalls as development push factors) by making our human capital stock the centrepiece of our development efforts? Should we in the future be focusing mainly on ‘beneficiating’ our human capital and, through it, seek richer and more widespread human development? The central theme of South Africa’s development would then become the harvesting of our youthful demographic dividend, so far left completely dormant.”

Sticks, carrots and international recognition

The answers to these questions bring exciting opportunities to business. Since SA’s logistics costs hover at around 12-13% of its GDP, these issues are of significant importance to any logistics and transport organisation. Add to this the fact that, of the 21-million young people (under 35 years) in SA, 18,3-million of them are without jobs*.

Both sticks and carrots exist to reduce the high proportion of logistics costs and youth unemployment, given that these result from the same cause – lack of skills. As of 1 May 2015, companies need to double their spend on training from 3% to 6% of payroll to meet the required eight out of 118 points on the revised B-BBEE scorecard. This can be most cost effectively achieved by uplifting the skills of those same unemployed youth and, by spending the same funds on the right people in the right programmes, 25 B-BBEE scorecard points can be achieved.

There have never been more learnerships in the field of logistics and transport than those that have been registered to date: it is the sponsorship of young AICs (Africans, Indians and Coloureds – especially women and handicapped individuals) on learnerships that earn the highest B-BBBEE scorecard points.

It is also learnerships that attract the highest levels of both SETA funding and tax incentives. In effect they are cost neutral, thus releasing funding to upskill existing staff who may not necessarily be AICs.

A further key development is that the international procurement and transport and logistics professional bodies, CIPS and CILT, are aligning their programmes to learnerships registered within a degree qualification. This means that graduating learners receive a local degree and may also qualify for international professional status.

Business sustainability

“It’s all very well implementing learnerships by bringing in unemployed youth” you say, “but how does this benefit my business?” From the 2014 Barloworld Logistics supplychainforesight report, ‘Respondents ranked the lack of relevant skills and talent as their number one strategic business constraint’.

This is emphasised throughout this and similar reports. Other studies have proved that 85% of learnerships graduates are retained in the businesses. Conclusion? Learnerships provide businesses with the scarce and critical skills needed for sustainability.

There are exciting times ahead! •

* ‘Youth in a state of emergency’: Andile Lungisa, former ANC Youth League deputy president, Sunday Independent, 15 June 2014

Written by: Charles Dey
Date: 11 March 2015
  • Warehousing in South Africa today – and the near future Worldwide, in the warehousing business, when future operations are discussed, the conversation is likely to be about more automation, greater variety, better systems, more integration, more efficiency and greater flexibility. The dreams, discussions and plans focus on issues such as robotics, the ‘Internet of Things’, tomorrow’s deliveries by drones, 3D printing, multi-channel fulfilment, ecommerce growth, rapid fulfilment and the need to individualise operations.
  • Warehousing 2018: from cost centre to growth centre Warehousing operations and IT professionals need to respond positively to the significant changes and challenges that will be influencing the industry over the next five years – or face disaster.
  • Raising productivity and morale in the warehouse It’s a well-known fact that happy and motivated workers produce better results. A recent study found that happier workers were 12% more productive than their counterparts. It underlines staff morale and wellbeing is not just an HR goal: it’s fundamental to business performance levels.
  • Supply chain orchestration – people are needed to play the music It’s easy to think supply chains consist of co-ordinated processes, enabled by cool IT, through which needed products flow smoothly with occasional storage to the end consumer. Great in theory but it takes the right people doing the right things at the right time to make end customers happy.
  • Africa: the giant IS awakening – seriously September saw the respective international conferences of two major supply chain management industry bodies – that of the International Federation of Freight Forwarders Associations (FIATA, in Taipei) and that of the Chartered Institute of Logistics and Transport (CILT, in Dubai). At both gatherings there was substantial African representation and, at the CILT Convention, Africans were in a clear majority. What does this imply for African businesses?
  • The Moneyball Problem OPSI Systems recently hosted the annual Operations Research Society of South Africa’s (ORSSA) conference, and it served as an illuminating example of the intersection of experience, education and technology.
  • Warehousing in South Africa today – and the near future Worldwide, in the warehousing business, when future operations are discussed, the conversation is likely to be about more automation, greater variety, better systems, more integration, more efficiency and greater flexibility. The dreams, discussions and plans focus on issues such as robotics, the ‘Internet of Things’, tomorrow’s deliveries by drones, 3D printing, multi-channel fulfilment, ecommerce growth, rapid fulfilment and the need to individualise operations.
  • Warehousing 2018: from cost centre to growth centre Warehousing operations and IT professionals need to respond positively to the significant changes and challenges that will be influencing the industry over the next five years – or face disaster.
  • Social supply chains: trend or threat? Buzzwords like social sharing, interconnectedness, engagement, immediacy and transparency have left the confines of social media discussions dominated by marketers and have started scaring professionals across all levels and functions of organisations.
  • Raising productivity and morale in the warehouse It’s a well-known fact that happy and motivated workers produce better results. A recent study found that happier workers were 12% more productive than their counterparts. It underlines staff morale and wellbeing is not just an HR goal: it’s fundamental to business performance levels.
  • Bridging the divide between fleet managers and drivers The relationship between drivers and fleet managers can often be challenging due to high productivity pressures and a lack of understanding regarding each side’s difficulties.
  • CHEP ‘Blue Motion’: gaining instant control of the SC CHEP South Africa’s newly launched ‘Blue Motion’ mobile application will allow wholesalers and retailers greater control over their supply chains. Named for the company’s distinctive blue pallet range, the application provides its customers with a mobile asset management system utilising real-time data, which can be formatted to suit customers’ specific needs.
  • Horses for courses – hub and spoke in rural Africa Moving goods from source to destination through Africa is a multidimensional challenge and one where first-world thinking still trumps appropriate. A change in game needs to happen.
  • Supply chain orchestration – people are needed to play the music It’s easy to think supply chains consist of co-ordinated processes, enabled by cool IT, through which needed products flow smoothly with occasional storage to the end consumer. Great in theory but it takes the right people doing the right things at the right time to make end customers happy.
  • Human error and accidents and the role of self-regulation Companies using third party contractors to move their goods are confronted with the challenges of poor economic growth, ever increasing transport costs and high rate of accidents. In an environment with one of the worst accident rates in the world, where accidents cost the economy an estimated R300-billion annually, something different needs to be done, but what?
  • The Analyst Age Data this, data that – data is certainly getting its due, but where do you fit in?
  • Truck drivers: obsolescence or opportunity? As new technologies shift the dynamics of employment in the supply chain, transport managers will have to gauge where the real benefits lie, and nowhere is this more apparent than future self-driving vehicles.
  • Africa: the giant IS awakening – seriously September saw the respective international conferences of two major supply chain management industry bodies – that of the International Federation of Freight Forwarders Associations (FIATA, in Taipei) and that of the Chartered Institute of Logistics and Transport (CILT, in Dubai). At both gatherings there was substantial African representation and, at the CILT Convention, Africans were in a clear majority. What does this imply for African businesses?
  • An Imperial solution in Malawi An effective supply chain model established by Imperial Health Sciences to deliver essential medicines to the people of Malawi has successfully achieved this goal, and, in addition, has resulted in the growth and development of a local logistics service provider.
  • Powering up your distribution As South Africans struggle with load shedding and Eskom angles for a hefty rate increase, we’ve been learning – with something bordering gleeful resentment – about the intricate details of national power supply.
  • Out … but not forgotten Outsourcing logistics and supply chain functions is commonplace today by manufacturers and shippers – but do customers get the deal they expect or deserve? It depends.
  • Managing change for long-term success The second episode of a three-part serialisation of the supplychainforesight 2015 research report highlights that with new technologies being introduced, and companies competing in an increasingly cutthroat and competitive ecosystem, the ability to make key shifts and transform from within is becoming essential for survival – and for long-term business success.
  • Exciting times – harvesting our youth dividend Legislation and other Government interventions may assist in transforming our society into one in which the limitations on each individual’s success are only self-imposed. A more important element to a nation’s success, however, is that those who have gained experience and expertise take proactive steps in using those assets to invest in society’s future – our young people. We examine the opportunities this represents.
  • The Moneyball Problem OPSI Systems recently hosted the annual Operations Research Society of South Africa’s (ORSSA) conference, and it served as an illuminating example of the intersection of experience, education and technology.