Business

Book Extract: Africa’s growing businesses need talent

2020-02-07 12:00

Tailor-made skills training programmes help boost entry-level opportunities

Africa’s Business Revolution

Published by Harvard Business Review Press

256 pages

R451

Available on Takealot.com

Africa’s growing businesses need talent: among the global and African executives we surveyed, half said they expected to expand their African workforces over the next five years and only 2% said they planned to reduce their employee numbers.

That makes skills shortages a pressing concern.

Many Africa-based companies have reported challenges in attracting and retaining the talent they need to run and grow their businesses.

But increasingly, Africa’s business lions are seeing the continent’s talent not as a barrier but as an opportunity to unlock.

According to Ghanaian entrepreneur Fred Swaniker, founder of the African Leadership Academy in 2004 and the African Leadership University in 2013: “The raw talent in Africa is there in large numbers but it just needs to be converted. And that doesn’t mean necessarily someone going through a full four-year degree.”

So what are the components of an effective African talent strategy, and what are the practical steps that businesses should take to make that strategy succeed?

BUILD VOCATIONAL SKILLS FOR FRONTLINE EMPLOYEES

The first imperative is to find smart ways to build vocational skills among entry level and frontline workers.

Data from Egypt, Morocco and South Africa indicate that by next year, between 41% and 50% of jobs will fall into the “skilled entry level” category, which includes administrators, craftspeople and operators.

These roles require practical, on-the-job skills building combined with theoretical training.

Unfortunately, most young Africans are not offered such training.

The result is that many of Africa’s fast-growing businesses struggle to find entry level employees with the skills they need.

One of them is Subway, the global quick-service restaurant chain, which sees Africa as a key growth opportunity as it shifts its footprint towards emerging markets.

Alex Brand, an executive at Subway’s Kenyan franchise holder, told us that hundreds of young people apply each week for positions at the company’s sandwich shops.

“People drop CVs at all our outlets,” he said. “There are a lot of young people that really want these jobs.”

But most of them “don’t know what it means to have a full time job and don’t understand the standards we demand here,” Brand said.

Out of every 100 job seekers, only two or three make it through Subway’s recruitment process – wasting precious human resources time.

Even among those who do make the cut, retention has been a problem.

“In our business, high turnover is bad: new employees don’t know the systems, aren’t comfortable talking with customers, and need training,” Brand told us.

Subway needed a solution that would match its job openings with young job seekers who had the right skills and workplace aptitude.

That led it, along with 180 other employers, to hire from Generation Kenya.

Generation Kenya’s purpose is to bridge the gap between youngsters who lack job training and employers who struggle to find the skills they need for business growth.

There are 37 Generation training locations across Kenya, each offering immersive “boot camp” training programmes targeted at building job readiness in areas such as retail and financial sales, customer service and apparel manufacturing.

Partnering with Generation Kenya has greatly improved Subway’s hiring “hit rate”, reduced shrinkage and boosted employee retention.

Several Generation graduates have been promoted to managerial positions.

One of them, Stella Jepkemboi, was appointed an assistant manager in 2017 aged 21.

She credits Generation with teaching her how to handle people – a critical skill in the restaurant business: “If a customer is upset, I now know how to stay calm, actually listen to them and offer them a solution.”

Generation provides heartening evidence that young Africans entering the workforce for the first time have what it takes to become high-performing employees in modern businesses.

All that’s needed is a smart approach to preparing them for the world of work.

CREATE ROBUST INTERNAL PROCESSES TO GROW TALENT FROM WITHIN

Getting job-ready frontline staff is one challenge, but finding and developing employees with technical, managerial and leadership skills is an even more complex undertaking.

A pessimistic view of these talent gaps would suggest that businesses in Africa should embark on a “war for talent”, outbidding one another for scarce technical and managerial skills.

But a more optimistic view – one we share – holds that companies can grow the leaders, managers and specialists they need from within their organisations.

Competition for talent will remain a daily reality, but smart investment in people development is the true differentiator of companies that win in Africa.

Arguably, Africa is at the early stages of a corporate education revolution, with many companies investing heavily in internal training programmes and institutes.

The Dangote Group, for example, established the Dangote Academy in 2010 to train employees in technical and managerial skills, on the explicit recognition that “we cannot rely on universities and colleges to provide the very specialised technical and managerial training required to run major industrial factories such as ours, particularly in the large numbers of such people that we will need”.

Several of Africa’s leading companies have gone a step further and created in-depth development programmes for high-potential employees.

General Electric (GE), for example, runs a yearlong “early career development programme” for the recent university graduates it hires in Africa.

As Jay Ireland, GE’s Africa president, pointed out to us: “When you’re hiring young people out of university in the US, almost every one of them has interned somewhere, so they know what a corporate environment is like. In Africa, that’s generally not the case. Our programme helps solve that and we’ve had very good success. Many of our graduates have gone on and done very well in higher roles.”

Smaller companies can adopt similar approaches.

Brooks Washington, CEO of Roha Ventures, struggled to find engineers with the right skill set to build and operate its state of the art glass bottle factory in Ethiopia.

“We’ve found great people who are clearly very capable. But it’s rare that you find someone who’s a perfect fit, especially when you’re building something that’s never been done before,” Washington said.

“So we recruited strong local engineers, then added a budget to take them to South Africa to train them for six months. It’s expensive, but it will give us a completely trained local workforce with the best glass manufacturing skills in the world.”

Together, these talent development processes are creating a new generation of savvy, energised business managers, operators and entry level workers across the continent.

Africa’s business growth will itself help to close the talent gap by creating opportunities for young Africans to build their skills, advance their careers and become leaders.

Reprinted with permission of Harvard Business Review Press. Copyright 2020 McKinsey & Company. All rights reserved



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March 29 2020