Business Report
7 June 2010
Jonathan Yudelowitz

Hegel sardonically observed that the only thing we learn from history is that we learn nothing from history.  The National Planning Commission is a case in point, comprising as it does the usual "great and good members" and launched with glib promises, like those of the commissions that begat our labour market framework and black economic empowerment (BEE).

Neither has dealt with unintended consequences, consistently ignoring the divergence between their ambitions and reality: a predictable consequence of politicians' arrogance.

The National Economic Development and Labour Council mandate of co-determination between union federations and big business to shape economic policy, growth and development has been subverted by vested interests, leaving small business and the unemployed to fend for themselves.

Our labour market is now unable to adapt to either the influx of foreigners or our school leavers; tragically wasting human potential and threatening South Africa's stability, development and national reputation because of the consequent xenophobia and rampant crime.

Unionised unskilled cleaners employed by large organisations iniquitously earn more than nurses, teachers and policemen, exacerbating the already critical systemic failures in our health, education and law enforcement sectors.

Strategies are more than plans; they involve conviction and vision, digesting robust feedback from the reality of how things actually happen.

The implementation of the City of Johannesburg's Rea Vaya bus network is typical.  The strategy was well-researched and clear, the uncomfortable resistance from the violent taxi industry is being faced and dealt with, firm boundaries enforced where important principles of the project have been at stake - to the benefit of Johannesburg, its citizens and visitors, rather than arbitrary interest groups.

Similarly, because the organisers of the World Cup faced uncomfortable realities, and made the necessary trade-offs, stadiums (around the country) and airports are ready and tickets are sold.

Broad-based BEE is a constructive advance on its BEE predecessor, encouraging companies to give black business a chance, appoint and promote black talent and invest in worthy causes.

But tenderpreneurship, fronting and enrichment of politically connected individuals show that de facto percentage ownership and management remain the elements of BEE that actually matter.

Nevertheless, many historically disadvantaged people who create economic value do more to enhance the reputation of BEE, build our society and economy than all the passive, politically connected owners of capital and token appointments put together.

This progress is unrecognised and diminished by our planners' insistence on quantifying transformation and ignoring the quality of contribution, the real driver of economic growth.  Of course critical mass is important, but it has the unfortunate consequence of commoditising black economic participation, leading to corruption and mediocrity.

BEE's protagonists ignore, or dismiss as racist, feedback that doesn't fit their planning models.  Typical is the contention by the head of parliament's committee for public enterprises that parastatals are "slaughterhouses for black executives" ("Spies to probe tenders", Sunday Independent, May 23).  This patronising assertion ignores the outstanding performance of many first-rate, fit-for-purpose black professionals and executives who keep the lights burning, postal services running and so on.

Ironically the hardship they have endured is connected with trying to do a good job and remaining committed and loyal amid the state-owned enterprises' (SOE's) crises.  These crises have been attributable mainly to the petty squabbling and misalignment between the various ministries to which each SOE reports.  This confuses the SOEs' respective mandates.

This situation is the real "slaughter-house" for the careers of both black and white parastatal executives and directors.

Successful implementation of change demands accepting the paradoxical truth that one must be guided by firm principles and passion, but never assume to know the needs of those affected by change.

Failure to grasp this results in the self-deception and corruption that led to the collapse of the Zimbabwean, Icelandic and Greek economies.

That's why we should be very careful of any economic or social policy formulation that facilitates these aberrations.

Jonathan Yudelowitz is joint MD of YSA and co-author of Smart Leadership.