Enterprise and Supplier Development made easy

By on August 31, 2015

by Pansy Morapedi, Managing Director at Honeycomb BEE Ratings With the advent of the amended Codes of Good practice, gazette in October of 2013, many companies were faced with many difficulties relating to navigating this new piece of legislation. As part of their transformation agenda, many entities had made major investment in supporting initiatives as per the 2007 Codes of Good Practice and were enjoying a significant level of compliance. These wonderful achievements were almost throttled overnight. As industry was wrapping its head around the amended codes; it became abundantly clear that gone are the days of hoping your verification process produces an acceptable level of compliance to B-BBEE. With these new regulations, companies need to make transformation and compliance thereof a pivotal role of their business. A day-to-day management of the process is now required; and will most likely require individuals with the competence and skills to interpret the regulations correctly and apply them to their business. In this area, many companies are sorely lacking and are now facing losing their outstanding B-BBEE levels to be non-compliant contributors to B-BBEE. Whilst the entire scorecard presents challenges, no challenge is more glaring than the Enterprise and Supplier Development element. With 40 points out of 105 attributable to this element alone, one wonders if any Transformation Manager is able to sleep at night. Albeit the actual target for Enterprise Development and Supplier Development remains at 3% of net profit after tax; the work required to make up that target has increased exponentially. For companies that have been content with writing a cheque two days before their financial year end, that “effort” has been reduced from 15 points to just a paltry 5 points in the amended codes. Hence the “B-BBEE strategy meeting” can no longer happen when finalising the following financial budget. In addition to the down-grading of Enterprise Development in the amended codes, more emphasis is given to spending a bulk of procurement spend with 51% or more black owned suppliers. In our industry, we

have often come across many an entity lamenting the scarcity of such companies; and often finding a black women-owned company with these credentials proves a further obstacle. Although our firm belief is that not many stones have been turned to find these suppliers; we certainly understand the challenge of trying to find such suppliers that do provide critical services and products for the economy to work. Without the requisite competence and skills, directing and implementing a transformation strategy for a company does become difficult. With a Board of Directors tasked with ensuring companies remain profitable in these hard economic times; it might feel like they are stuck between a rock and a hard place. This is where the expertise of Honeycomb Transformation comes in. We are equipped with the competence and capacity to assist companies and boards navigate the murky waters of transformation. Our role will be to look at cost-effective mechanisms to implement B-BBEE and address the challenges of the Enterprise and Supplier Development element. Companies can see from the outset that the cost of doing B-BBEE has grown exponentially. Our mandate and our promise is that we will find means and ways for your company to address this element in a way that will ensure a minimal impact on your budget.

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