CFOs discussed digital transformation, and the need to think beyond the numbers.
An informative Finance Indaba Conversation was hosted by Brian Chivere, CFO SA’s community manager, and featured panellists James Wilkinson, TFG/Foschini Group chief strategy officer, Welela Dawit, CFO at Microsoft South Africa, and Deon Fredericks, group CFO for Famous Brands.
The interactive conversation was enabled in partnership with Sage. Jordaan Burger, Sage vice president of finance for Africa, the Middle East, and Asia-Pacific, led a short presentation on the role of digital transformation in providing solutions that drive resilience.
“Businesses in South Africa have faced many challenges in the last 18 months,” said Jordaan. “Covid-19 has had a huge impact on different industries, and then there was the civil unrest, but there is a silver lining – and that’s where digital transformation comes in.”
Jordaan pointed out that the benefits of the cloud can’t be disputed, and he’s seen it first-hand. During the level five lockdown, customers were phoning Sage in a panic, as they couldn’t access their premises to do payroll. With cloud-based accounting software that’s not tied to a location and has a centralised dashboard, this isn’t an issue.
“That’s where the cloud changed everything,” said Jordaan. “And that’s why Sage wants to keep accelerating and providing solutions for customers through technology and help them be more resilient.”
Plurality and a growth mindset
The conversation began with the panellists sharing their thoughts on resilience, and what it means to do good business in 2021.
For Welela, resilience is the ability to cope with ever-changing dynamics. “Do you have the muscle to anticipate challenges, both internal and external, and pivot as needed? No one could’ve predicted the pandemic; we need to be able to constantly assess and look round the corner,” said Welela.
According to James, doing good business shouldn’t be an afterthought; it should be based on a shared -value approach to profitability and purpose. “It’s where multi-stakeholder capitalism comes in, the idea that success for us is also success for our customers,” said James. He admitted that these aren’t always easy conversations, and organisations need to understand the context that the business operates in so that everyone can fully benefit.
“Doing good business should challenge us, and make us think beyond ourselves, like taking the environment into account,” added James. “It’s about changing the way we think and adding a level of plurality.”
Deon added that a realistic approach is needed. “Being sustainable is now a given; businesses have to consider the planet and people’s well-being. Profit is no longer everything, and it’s about how you operate ethically,” said Deon.
“Doing good business isn’t a one-size-fits-all approach, it’s holistic. As finance people, we must balance it with acceptable returns and a measurable, sustainable outcome.”
Welela emphasised that a north star is a fundamental starting base, with the alignment between employees and the organisation’s purpose being critical.
“Employees need a clear understanding of what the business’s objectives are. If they’re aligned to the values of the business, the purpose, that’s when you’ll get the best out of employees, even in the most challenging of times.”
She added that a growth mindset is essential, too. “The world is changing; having the ability to be continuously curious and to remain competitive is key.”
Changing timelines and product stewardship
Business resilience has taken many forms during the past 18 months. Welela shared that at Microsoft, instead of doing a yearly budget, the company is now does budgeting in six-month intervals.
“Intelligent insights can also determine what the next six months will look like. We’re leveraging bots and AI in these processes, and budgeting now requires little manual manipulation so we can be flexible.”
According to James, resilience also covers “product stewardship”, or resilience in the product that is being sold. “Businesses need to look up and down the value chain, and have an extended responsibility beyond the factory gate,” said James.
James shared that TFG is getting involved with fabric recycling start-ups in Cape Town, as well as looking at digital clothing resale, which has become huge for Gen Z influencers. “Slowing down fast fashion is a big part of our business resilience – and it’s all part of doing good business.”
Friction and pressure spur shifts
The participants agreed that there is still friction for South African businesses, and it remains a challenge to get the fundamentals right. With the likes of Covid-19, load-shedding, and civil unrest, business resilience – and doing good business – will need to go back to basics, and company cultures will have to shift.
“In times like these, you’ll need to focus on interim solutions: get back to basics and stabilise the business, then accelerate,” said Deon. “Company culture that hasn’t changed, despite the world changing, is also a problem – a holistic approach is the answer.”
“It’s amazing how we can act with speed and agility when there’s pressure put on us,” concluded James.
“I won’t say for a second that Covid-19 has been a good thing, but it has changed the way that we work and do business. I think that we won’t go back to the old ways of doing things, ever."
As seen in the chat
Tina Maharaj, SABS – “We had to adapt to survive. We did remote auditing for international clients, and now we’re looking into wearable tech, automation, and digitisation. We’ve realised that we have to move forward and bring in solutions.”