I have met many young people who think that one needs a magic wand to get ahead. They are looking for a quick deal, a quick opportunity, in essence a quick fix to get money and success now. Conspicuous consumption and the I-want-it-now-this-very-moment mentality is now the order of the day amongst these impressionable youngers. They judge success based on the visible, material abundance on display. They do not care how the person got there. They do not ask, what business are they running, where do they work to achieve this conspicuous wealth. All they strive for is to be the same, to be like them in order to be successful.
What I know for sure is that the rules for success have not changed. They have remained the same since time immemorial. The is no short-cut to sincerely, consistent and dedicated hard work. Determination, focus, tenacity, perseverance, honesty, authenticity and consistency are all key ingredients to success, but it is your attitude that is the determining factor, the most important factor of all. Skill, education and experience are important, but without a managed attitude, an ego that is constantly put in check, success will be elusive to many.
Wednesday, February 25, 2015
Tuesday, August 27, 2013
The Elusive Virtue of Suffering in Silence
Recently, in conversations with close girl friends we have realised that our discussions have shifted. The most part of our girl talks centre around the changes in our bodies and that of our partners, the impact of those changes on our lives and the health implications. We are surprised, yes, surprised, that getting old just creeps up on you and is a very personal, often unwelcome and sometimes indescribable experience. We are aged between 48 and 58 years old, are a bunch of informed, educated, well read, travelled and cultured girls.
Do not get me wrong, we have never been this self centred and self preservation focused before. We have been there, done that and burnt the t-shirt. We still work harder and smarter and most of us within our collective are business owners. Amongst us a few have done our version of national service - development work, in country and abroad and some continue to do that. We are also very focussed on charity work, because there is a need out there, but most importantly because we derive a lot of joy from giving. Be that as it may, increasingly, we have realised that we have been gravitating more and more into the me-myself-and I-and my girlfriends space.
Some of our mothers are still alive and we were wondering why they never suffered the same ailments that are bedevilling us, never had the operations we have had from hysterectomies, liposuctions to gastric by-passes, never had to tattoo their eye lashes, never taken Prozac, never seen a shrink or even had Botox injections for non- surgical face lifts, yet they look wonderfully young in their 70's and 80's.
We have been asking, how come we did not know that age just creeps up on you like that and in a non- negotiable, very undemocratic fashion, arrests some of your most valued freedoms - like having a tiny waistline and flat stomach and not have to worry about wearing those dreadfully awful spandex tights, we have come to call bambazonke (hold every thing in and tight) - that you have always taken for granted, locks them up and literary throws away the keys.
So two of us with mothers alive, asked, why they never told us these very important ingredients of life so that we could have been better prepared. The mothers both said, they were raised in an era where, privacy was guarded at all costs and most importantly, you were meant to suffer in silence, in fact, there was pride and dignity enshrined in silent suffering. Certainly, a tall order for our girl friend collective.
Privacy, never mind its cousin silence are little known words in the days of our times. Living in a world supposedly signalling the end of privacy and confidentiality and giving rise to a new era of full disclosure, my girlfriends and I are surprised that even with the confines of a nuclear family, when we dare share the details of the body pain, itches or twitches we are experiencing, even our young adult children, with a high propensity for sharing on Facebook, twitter, google, Instagram and you tube, would complain, "Mom, you are sharing way too much information!" It turns out, that even the generation that puts much more of the "social" in social networking is much more discerning what personal information they want to hear...particularly if it is from their mothers.
Where does that leave us, we wondered. The obvious answer is, in the same situation, the same box as those who came before us, our mothers. But, perhaps our mothers bore the silence because their generation whilst ageing at the same pace as us were healthier and better prepared to remain silent.
We resolved that we were not going to be silenced. We were going to be heard, come rain or sunshine. We were not going suffer and die in silence. For us, the dignity and pride our mothers found in that, is elusive.
Tuesday, January 8, 2013
An anecdote on the ugliness of our helplessness in dealing with GBV.
The word Sorry has become such a misused and exploited word. You do something knowing very well the consequences and after the deed, you apologise. It is that easy, I guess. Mistakes do happen and apologies are made. But when the same person repeats the same mistake over and over again, it becomes a choice and the apology sounding like a stuck DVD, is insincere. When fully grown adults repeat the same undesirable behaviour and say the word, sorry, one more time, I feel abused, cheated and angry. When is a promise a promise worthy of honoring?
Five months ago in July 2012, one of the workers, M, who live and work within our compound beat his wife, G, also an employee. We had a meeting with S the Supervisor and we expressed our dislike of one human being battering another, no matter the circumstances. M said he was sorry and promised that he would never do it again. I cautioned him that violence was against my very core as a human being.
Fast forward to Dec 2012, M, beats again G, who is now 4 months pregnant. G misses four days of work because of the beating and M, tells me that G is sick because of the pregnancy. As we were at a client's place, I advised M, that it was not an issue I wanted to discuss then and we would discuss it at a later, more suitable time.
Meanwhile, I am completely enraged and decide to cool down for some weeks whilst I decide on a plausible course of action besides firing M.
Eventually, I muster the courage to be 'reasonable' about an unreasonable situation and I call both M and G who are both on leave but present in my quarters to come for a meeting. I ask M what happened and he says it was not a beating. G maintains it was. I remain calm, for a bit. Then all of a sudden I completely loose all my marbles. I find myself outside of my skin looking at the performance of whatever bodily remains represented myself. M realises that this is serious and he says he is Sooooorrry. Again!
I climb back into my body, trying to maintain my composure and ask the perpetrator of the abuse to explain to me what it is that a fully grown adult capable of making a woman pregnant cannot discuss verbally and resolving without resorting violence. M, remains quiet. I ask if I am talking by myself and he mutters a faint and limp no.
I advise G to assess her options as a woman and think hard about the wisdom of choosing a life of violence having made it clear to them earlier that no self respecting person causes grievous bodily harm to another person they refer to as their loved one. G, stares at me. I do not know where it was stare of disbelief or surprise or she had just had her aha moment.
I confirm then, what I have always known, what I always feared, that it is unfair and unjust to impose my will on others, particularly those in a position of less power and influence than myself. G tells me that she is still unwell. I give her money to visit the clinic for a check up. I advise the couple to pack their bags and look for alternative accommodation elsewhere because I never want to have this conversation with them again on my premises. If they still want to work, they are welcome to, but I would be damned if I were to continue to have gender based violence (GBV) taking place within my compound.
They left yesterday and are both due to report to work on the 21st. So why am I still angry and outraged? Why do I feel violated when I am not the survivor of the violence?
I believe I know the reason. It's my sense of helplessness that ushers in the rage. There was no lasting solution to the GBV. As a person raised by men in my family who admired, cherished, affirmed and dearly and unconditionally loved the girl child, I am at odds to understand GBV. It makes my temper flare up in a manner that scares me. I am, however delighted that I am not a gun totting and panga wielding person, otherwise, I would not have been responsible for my actions, particularly, that time, when I stepped out of my skin for a bit.
I feel helpless because there are no lasting solutions for women who are survivors of GBV. I personally do not believe in half way homes for the women. When they are reintegrated back into society, the societal and familial pressures force them to go back to their abuser. He is your husband, they remind them. To many people in this part of the world, marriage is an accomplishment and an achievement that must be aspired for. Most importantly, when women are poor, vulnerable and not economical empowered enough to be self sustaining for themselves and their children, not only do they make bad decisions, the basket of choices from which they can consider various options is just not available to them. So they stay and the GBV continues unabated.
I believe I made a stand, a selfish stand. I chose not to see and entertain GBV in my compound. That is all I chose to do, for now. I do not want to deal with it. It is time wasting and emotional draining on my part. I do not want to continue footing health bills associated with the GBV including their already compromised health. GBV in my compound is a distraction for me and interrupts my social and business life. I am fully aware that the posture I have taken is as ugly as the GBV itself. I have taken this posture for my personal sanity and self-preservation. In this incident involving M and G, the GBV is likely to worsen because the forced eviction from my free accommodation and other amenities is going to lead to an erosion of their economic circumstances and therefore the fights are going to escalate. I am unable to stop it and I know third time around, the GBV incident will be presented on doorstep of my compound. When that time comes, I will terminate both their employment. I believe it is easier to deal with GBV when the perpetrator and the survivor do not have a connectedness with your social (living in my compound) and business (M works as one of my valued welders/painters and G is a valued cleaner at the lifestyle centre) life.
Yes, GBV is one of the reasons why I find the S word overused, fickle and insincere. The human race has made phenomenal advances in science and technology and yet we still do not know how to live side by side with each other peacefully as human beings. I rest my case.
Friday, October 14, 2011
Your character determines your credibility and integrity : guard it with everything you have got.
I used to be in banking once upon a time. With a team of seven people, I helped set up what used to be called the Zimbabwe Banking Corporation (ZIMBANK) Small Business Services Division (SBSD). The late eighties to early nineties was one of the most illuminating periods of my life. I learnt about people, honor and entrepreneurship in a way that has stayed with me up to this day.
For many countries through out the world, the promotion of small and medium sized businesses (SME’S) is a cornerstone of economic policy. Government support for small enterprise appears to be based on the widely held perception that the SME sector is an incubator of economic growth, a place where innovation takes place and new ideas become economically viable business enterprises. In addition, policymakers routinely point to SMEs as important sources of employment growth. It is not surprising, then, that there was widespread political support for government programs and other subsidies aimed at encouraging the growth and development of SMEs in Zimbabwe during the late 1980’s and throughout the nineties.
A particular area of concern for Zimbabwe policymakers was whether small businesses where accessing enough credit and if there was credit extended to them at all, to fund their business operations. After all, many SMEs at inception have little or no credit history, no collateral and questionable capability as many aspire to venture into areas they have no experience in. Lenders have ordinarily been known to be reluctant to fund SMEs with new and innovative products because of the difficulty associated with evaluating the risk of such products. These difficulties are classic information problems; obtaining sufficient information about the parties involved in a transaction; and they may prevent otherwise creditworthy companies from obtaining credit. If information problems are substantial, they can lead to declining of loans or credit rationing. Credit rationing is when loans are allocated by some mechanism other than price. To the extent that credit rationing significantly affects SMEs credit markets, a rationale exists for supporting SMEs through government programs aimed at improving SME access to credit.
During that the late 80’s and early 90’s, the government of Zimbabwe (GOZ) introduced many enabling initiatives, the most generous of which where located within the former Credit Guarantee Company (CGC), which was a subsidiary of the Reserve Bank of Zimbabwe. Millions of Zimbabwe dollars (long before hyperinflation and the Zimbabwe dollar was still regarded decent and tradable currency) where placed within the CGC to act as a guarantee for all loan advances to SMEs through the five commercial banks. This was before the financial services industry was deregulated to allow new entrants into the market place and therefore there were just five banks, ZIMBANK, Standard Chartered, Barclays, Commercial Bank of Zimbabwe and Standard Bank of South Africa (STANBIC).
As these banks (referred to then as “traditional” banks because of their being averse to lending to the SME sector) jumped onto the bandwagon of setting up small business divisions as a result of the increased guarantee scheme within CGC, the entrepreneurial market responded accordingly. Many people set up businesses and accessed financing from the different banks.
As bankers targeting SMEs at ZIMBANK SBSD, one of the criteria, albeit very traditional that we used in appraising business proposals from the SME sector were the three C’s, Collateral, Capability and Character.
Collateral is the security, preferably immovable, which if available, for example, the Bank would secure the title deed and register a first or second mortgage on the property as security. We became creative and if the business loan was going to be used to buy equipment for the business, the Bank would have a lien over that property. This is a rather simplistic example but forms the essence of what collateral we secured from the SMEs.
Capacity involved assessing for managerial capacity to run the business, including analyzing the skill sets the project promoter and their employees had in the business to be funded. For example, if a lawyer wanted to set up a construction business and they were going to do the work themselves, we would obviously be worried and probe the applicant further. The complexion of the application would change if for example, the lawyer project promoter had a foreman and brick layers, carpenters, engineers, roof technicians and so on who were qualified to execute all the construction projects.
Character entailed investigating the level of indebtedness of the person with other people, organizations and financial institutions. We also tracked down people who had transacted with the person and asked them to provide objective opinions. The personal interview also provided a lot of clues about the nature of the project promoter. During the interviewing process, I personally worried, about people who did not answer the questions asked, body language and reading in between the lines. This is all very subjective stuff but I believe that when one acquires experience over time on interviewing potential borrowers, one hones their skills on hearing clearly what the other person is not saying during that communication process.
For example, we realized that many men who wanted to access these interest low and guaranteed loans had bad credit ratings. They then submitted their project proposals in the names of their wives, sisters or girlfriends, who were acting as fronts for them. During the interviewing process, we quickly picked up from discussing the essence of the business that the wife, sister or girlfriend was being set up as a front. When we probed enough, they owned up as it became increasingly apparent that it was not their business idea to start with. It is very difficult to be passionate about business when you are not business minded or to be passionate about a business idea, which you did not generate. The entrepreneurial zeal was therefore a key factor in our determination of the character of the entrepreneur.
Personally for me character assessment was the most exciting part of the project appraisal process. I remember recommending to the Advances Committee borderline SMEs whose project promoter characters were sincere and abundant with integrity. There are many who came with viable projects but whose characters were shady whom I did not give favorable recommendations.
I observed that, at about ninety five percent of the time, I was right in giving Character, the largest weight amongst the three Cs, because I saw many borderline SMEs whose promoters were genuine, grow from strength to strength and obviously viable SME projects whose promoters lacked credibility struggle or fail completely.
What many people do not realize is that your character is your passport to opportunity as it determines your credibility and integrity. It impacts on everything you do at home, socially and particularly in business. It is impossible for a person to have a different personality for the home, with friends and at work. If that is the case and you are a potential lender to this person, be very very worried. Consistency is a key ingredient in good character development. When you are not consistent, it is my considered opinion that you must be doubted.
Character is everything. As an experienced lender, you ignore your intuition at your own peril. That is the fundamental reason why after everything is said and done, people prefer to transact with either people they know or who have been recommended by people they know. Why? Because the person who is being referred or who is already known to you or others has had their character qualified or validated by one means or another. Just because you hold an MBA or a Doctorate in your field of expertise does not necessarily qualify you to have the right of passage to participate in certain transactions.
It is said that a lot of business deals are generated, discussed, apportioned and concluded on the golf course. Why? Golf players spend a lot of time together, walking the course, talking and of course playing the game. An 18 hole course, I understand might take some five or so hours to play. If say two teams of two people each play just twice a week, that is forty hours of sharing and of course bonding which is necessary in business. Escalate that to twice a week for say forty weeks per year, that amounts to some one thousand and six hundred hours of talk and bonding time. Perhaps that is why golf mates first seek each other out when opportunities present themselves than accommodate someone from “outside”. This is because, when you spend one hundred and sixty hours per month of playing, walking, talking, bonding, laughing and so on, you are bound to know each other fairly well. If you change your playing partners every month, it means you are expanding your territory of networks, people who can vouch for you. After everything is said and done, it is the intangibles that matter and character determination is an intangible.
In order to successfully defend your character for prosperity, here are three concise suggestions to nibble on:
1. Meet your financial obligations when they become due: If you cannot pay your debts or bills on time, do not bury your head in the sand like an ostrich hoping your incapacity to pay on time is going to go away. It will not. Contact the lender first before they contact you and renegotiate the terms of payment. Be honest by advising them that you are experiencing a temporary cash flow situation. Do not lie by telling them long stories that you are waiting to be paid from the liquidation of your shares or something like, you are waiting to transfer money from your offshore account. Lenders are patient. They will document what you have said and wait for another excuse until, you have eroded your integrity and widened the credibility gap with them. The truth is the only way out. It is easier to remember the truth, than to remember a lie. Those who are now financially secure know all too well the challenges of cash flow when a business is still in its infancy and struggling to pay its bills. When you keep quiet, the lenders’ mind starts to become fertile with imagination; has the borrower run away? are they dead?, does the borrower have no intention of paying back?, and so on, etc.
2. Live within your means: Whether you are in business or not, you need to postpone consumption, be frugal, save and live within your means. This is easier said than done. If you are unable to do it now, make it an aspirational goal. The media is one avenue solely responsible for people living beyond their means by encouraging conspicuous consumption and the “I want it, I must have it right now” mentality. Someone once said, “it is a crazy world out there, when we buy what we do not need, with money we do not have, to impress the people that do not care about us and then spend the rest of our lives regretting it.” When you tarnish your financial credit worthiness, it becomes very difficult for you to transact in a highly networked society. We are living in the information age where people underestimate the movement of information from one place to another and the sharing taking place amongst people.
Our families’ trust recently walked away from a potentially viable business transaction we wanted to invest in because of the character of one of the business owners. She borrowed money from a mutual friend and under the veil of moral superiority and all kinds of misrepresentations, is now delaying paying that debt back. This is totally unacceptable. Refrain from masquerading, tell the truth, explain your circumstances, whilst living within your means and ask for more time to regularize your financial matters with the lender. It pays to be truthful.
3. Embark on any journey, business or otherwise for the long haul: Short-termism a term I use to describe those people who like short-term results, short-term businesses, short-term relationships and so on has led many a people down the narrow road towards despair and desperation. Getting into business, stay in business and making a success of it is no easy fit. Sometimes one needs nerves of steel, a sense of humor to laugh at ones’ self, sheer grit, tenacity, perseverance, commitment, timing, working both hard and smart, sometimes luck and sometimes knowing somebody who knows somebody who knows where to get something that you want. You must be hungry enough to want it so badly but remaining mindful of the fact that the rewards do not come overnight. You have to be in it for the long haul. That means not quitting when it becomes tough and unbearable, hanging in there when its easier to walk away, staying the course when perhaps all you see is a hazy ray of light far away into the pitch black unknown space. If you do not have these character-istics, then you are not suited for entrepreneurship and you are better off staying away from it as far away as possible. Never listen to anyone who tells you that they made money in their first year or two years of operations. It is not a business they are running, but a quick buck dealer-ship and during that year, they have participated in several deals.
I am now calling years 2000 -2010 in Zimbabwe the lost decade. Cultural values, business ethics and most importantly personal governance of the self have been diminished and minimized. Every nation in the world has got its barbarians waiting at the gate that it never allows to let in because they are deviants. During our lost decade, the barbarians were erroneously allowed in and they have taken over and redefined the character-istic of the Zimbabwe value system landscape we all used to be proud of. Choose not to subscribe to the ethos of the barbarians in your courtyard. Reclaim your space. Take back your power and fight hard to redefine your character so that it stands for trust, honor, credibility and integrity by following these three above-mentioned suggestions and watch the positive changes in your life.
Sunday, August 28, 2011
Because they can, rightly or wrongly.
I have been back home in Zimbabwe exactly two years in July 2011. My observation that things are seldom what they appear to be, seems to aptly describe the general state of affairs in my beloved country. Whilst it is my considered opinion that, Zimbabwe is a country abundant with opportunities and alive with possibilities, I often wonder whether we are interrogating the right questions, whose answers would assist us in making informed decisions.
Have we ever wondered why a small landlocked country like Zimbabwe is forever courting international attention? Is courting international attention a strategic posture of the political establishment in this country. Coming from the private sector, it seems to me that political risk is the largest single factor impacting on business decision-making? What is the minimization of this political risk? Is the political risk controllable? Can political risk in Zimbabwe be managed? How can we incorporate political risk into our macro and micro scenario planning for business decision making at organizational and sector level?
Last week after the announcement that Gadhafi had fallen, many Libyan Embassies around the world apparently pulled down Gaddafi’s green flag and his portraits and replaced them with the flag of the National Transitional Council (NTC) of Libya. After the foreign Embassies had announced to their host countries that they had defected to the NTC, all countries with the exception of Zimbabwe accomodated the move. Zimbabwe on the other hand, announced that the NTC is not accredited with the Government of Zimbabwe, a SADC and AU requirement and therefore would not recognize the Embassy’s new status. In addition, if the Libyan Embassy in Zimbabwe no longer represented the interests of the Libyan people, they would be asked leave. Why does the political establishment in Zimbabwe continue in a contrarian behavior? Because it can.
There are many unsubstantiated reports in the Sunday media of today, the 28th August, 2011 suggesting that Gaddafi could have sought political asylum in Zimbabwe, a report ZANU PF has denied as speculative and untrue. Assuming there is a shred of truth in these allegations, why would Zimbabwe go out of its way to harbor a perceived fugitive from justice whom the international community including the NTC of Libya has vowed would not let any clock, calendar nor boundary bar them from bringing him back to justice? Why would the political establishment in Zimbabwe even consider this move? Because it can and most probably no one and no body would stand in its way.
The events of the past ten to fifteen years around agrarian reform need no mention here in greater detail. Many white farmers in Zimbabwe have fought for nearly a decade, seeking compensation for their loss of immovable and movable assets which were seized from them violently. Not much progress has been made in this regard as some of the beneficiaries of the land reform programme are themselves part of the judiciary meant to preside over these cases. The drama that unfolded during this land reform programme happened in full view of the world and no interference from the international community, why? Because the political establishment, which is in essence the Government of Zimbabwe can.
More than thirty years on, Zimbabwe is taking about an indigenization policy that seeks to control and even nationalize foreign owned companies. First it was the land reform programme, and now it is the black economic and empowerment plan. What is evident is that there has been no extensive research and broad-based stakeholder consultations at sector level. Those who have been asked to spear head this policy have been hand picked because of their political affiliations to the current political establishment: a move not necessarily unusual when compared to other economic empowerment programmes in the region and world wide. There are divisions in Zanu-PF, government and bureaucracy in general, ministers across the political divide and in state institutions, yet the Youth Development, Indigenization and Empowerment Minister is plodding along seemingly making up controversial rules and decisions as he goes along. Obviously, this is being sanctioned at a much more senior political level, because they can.
Recent and past events I have mentioned in this note are far from exhaustive. Be that as it may, having been an organizational strategist for most of my professional life, I am becoming increasingly uncomfortable about what I do not know about the political dynamics in Zimbabwe. Hence the maxim: things are seldom what they appear to be. The political landscape is fairly fluid and whilst appearing to be on less firm ground, the political power of Zanu-PF which sees itself and acts in a manner exuding seniority in the Global Political Agreement is undoubtedly the only certainty on the ground. There are too many unknowns and therefore many blind spots. When there are too many unknowns, it is becomes an exercise in futility to connect existing dots. When known dots remain unconnected, it implies serious chaos and fragmentation inside Zimbabwe Incorporated, which then stifles innovative thinking and hampers logical decision making.
This leads me to the conclusion that, what we might not know about our country is probably very shocking. Yes, we know that in the 21st century, change is the only constant. However, if we are unable to plan for our future with a certain degree of certainty, then we are doomed into planning for the for-seeable short-term, which is what the majority in Zimbabwe have already become, in essence, living and planning for now, essentially compromising any meaningful future economic recovery of this beautiful nation. Unfortunately, time is not on our side and the rest of the world is not waiting for us to get our ducks in a row.
Tuesday, March 1, 2011
The National Employment Councils (NECs) in Zimbabwe: Are They Killing the Goose?
The National Employment Councils (NECs) in Zimbabwe: Are They Killing the Goose?
Written and Presented by Gloria R. Ndoro-Mkombachoto at the HUMAN RESOURCES (Pvt) Ltd Labour Relations Conference held at the Jacaranda Room, Rainbow Towers, on the 24th February, 2011
Good day ladies and gentlemen. All protocols observed.
Just under a year ago in May 2010, Zimbabwe was still in a major economic crisis with unemployment hovering at around 94% and our industries working at less than 40% of capacity. Fast forward to February 2011, the situation has not changed much; Zimbabwe is in a state of slow and painful change characterized by structural transformation. With very little to jump-start the economy, Zimbabwe must revitalize and grow this economy. The template upon which Zimbabwe must chart its economic path in the short, medium-to-long term is characterized by the following factors:
o Erosion of competitiveness which has long been undermined by two decades of above average inflation culminating in unprecedented hyperinflation during the period 2005-2009.
o Destruction of the national savings base
o Liquidity and budgetary constraints and,
o Eradication of the middle-class as a result of rampant unemployment
The dollarization of the economy has brought about great hope, tangible opportunities but also “blood, sweat and tears.” Our human resources are going to play a pivotal role in the transformation of our economy, but first, we now have to live within our means. This meansthat wage negotiations cannot be based on “economic hardships being felt at the time” but on the productivity of thelabour force. We cannot simply increase wages willynilly, say by 12% or more when our GDP is growing at under 4%. Before we talk about the growth of the economy, we must first plug in the leakages, unchain ourselves from the shackles of the past ten or so years, develop a master plan to turn the economy around at firm and sector level and then grow the economy.
The National Employment Councils (NECs) are at the centre of this economic transformation. The parties to NEC must all be in belt tightening mode if the transformation of the Zimbabwean economy is going to be achieved hence it is unfortunate that we now have the unfortunate set of circumstances we are currently witnessing, circumstances likely to derail turnaround of Zimbabwe Incorporated.
Government, Labour, Employers and Employees in all the sectors of our economy are all tied at the hip. Zimbabwe cannot afford right now to have any one of these stakeholders, (in particular labour and those that purport to speak for and represent labour) pulling away at cross purposes in another direction.
The Legal Framework
International Labour Standards[i]
Zimbabwe is a signatory to International Conventions administered by the ILO.Inaddition, it also has an obligation to uphold the principles enshrined in the 1998Declaration on Fundamental Principles and Rights at Work, which encourages ILOmember states to respect the eight core Conventions, with or without ratification. ILOConventions place an obligation on the government to respect, fulfil and refrain fromviolating the socio-economic rights of men and women in respect of decent and fairworking conditions. The Conventions set minimum standards of application andgovernments are expected to report on the progress of their implementation.Under Zimbabwean law, ILO Conventions do not automatically become part of thenational law; for this to occur they have to be domesticated through an Act ofParliament.However, these Conventions have had a significant influence on the national
labour legislation in Zimbabwe.
Statutory Law
Firstly, the Constitution of Zimbabwe, which is the supreme law of the land, does notexpressly provide for the realization of socio-economic rights such as labour rights.Labour and employment issues are only enshrined in various Acts of Parliament and aredivided into the public sector, private sector and export processing zones
The Labour Act is the principal legislation governing the general aspects of theemployment relationship in the private sector. Some aspects of the employmentrelationship are regulated by the National Social Security Act [Chapter 17:04], whichallows for the establishment of social security schemes for the provision of benefits foremployees and provide for the labour inspection framework.
The National Employment Councils (NECs)
For those who are not familiar with NECs, here is a short definition of who they are: the NECsare representative bodies of employer and employee organizations. The NEC is ordinarily made up of four structures namely: the Council, the Executive Committee,the Negotiating Committee and the Local Joint Committee. Key to these structures areDesignated Agents (DA) and Arbitrators who are responsible for resolving disputes interms of the Labour Act.
The NEC Constitution
1. The Council – A national structure composed of Councillors who meet once a
year at an Annual General Meeting. The council is the supreme policy and
decision-making organ.
2. Executive Committee – A national structure whose role is to implement Council
policies and receives monthly reports from NEC management.
3. Negotiating Committee – A national structure appointed by the Council to
conclude or amend the Collective Bargaining Agreement on behalf of the
Council. It deals with appeals from the Local Joint Committee.
4. Local Joint Committees – Regional structures appointed by the Council in any
area within its jurisdiction. They consist of equal number of representatives from
the employers’ organization and the trade union. One DA in each region is
responsible for conciliating disputes between employers.
Under Zimbabwean law, the industry agreement made by NEC is binding on all employers and employees in the industry, whether or not they are members.
Collective bargaining
Collective bargaining in most sectors takes place at NEC level and, in a fewcases, at company level through functional Works Councils. The Negotiating Committeecarries out collective bargaining at NEC level and Works Councils at company level. Interms of the Labour Act, workers are entitled to negotiate at company levels for specificbenefits through Works Councils. However, nowadays, veryfew Works Councils are functional in the most sectors of the economy. In a country with a high unemployment rate, workers lack the desire nor inclination to engage an employer and in the past when interviewed have highlighted the problems of victimization and intimidation as the main causes of thenon-functionality of Workers’ Committees and Works Councils.
During the past 10 or so years, NECs were left to their own devices by their key stakeholders and as a result, their mode of operation developed a life of its own. Instead of remaining at the centre at they must objectively represent both employers and employees equally, the NECs shifted to the left and took posture where their role has been to argue and push for higher wages regardless of what the fundamentals are for the employers at business and organizational level. There are allegations that, the severe economic hardships of the last decade made them loose focus and as their own livelihoods depend on income from a percentage from the sector employees, they set aside their mandate for the self gain and profit motive. Consequently, most sectoral NECs are now perceived by most employers to represent the interests of the employee organizations only.
Investigations done by the writer have revealed that where there is consensus and progress in wage determination where the employer negotiates directly with the Workers’ Council. This is because when the business is struggling, the employees on the ground, experience it on a daily basis with the employer and therefore during collective bargaining, they tend to be reasonable. There are many instances where employees have chosen to have nil increments over determined periods of time if the employer allows for natural attrition only whilst guaranteeing nil retrenchments.
Recent disagreements
In what was perceived to be a controversial move by 17 employer associations under the Employers Confederation of Zimbabwe (EMCOZ) after a December 2010 meeting, employers agreed to make a once-off salary review in 2011 because of the tough operating environment. [ii]
However, this it was feared that this stance could fuel more job boycotts by employees. Collective bargaining ended in deadlock in many sectors in 2010 after unions in many sectors represented by their sector NECs pushed for salaries above the poverty datum line now estimated to be over US$500. The Zimbabwe Congress of Trade Unions (ZCTU) has been under the rebuttable presumption that many companies are paying “slave wages” and use the subdued economic activity as an excuse.
There have been numerous cases of litigation between employers and employees because of failed salary negotiations and this has been disruptive to business operations worsening the already challenging operating environment for most sectors of the economy. ZCTU has argued for wages relating to what they have referred to as “price and income ratio”, another phrase for wages based on “economic hardships”. On the other hand employers watched helplessly as NECs bulldozed them into awarding unsustainable salaries during collective bargaining hence the deadlock.
As a result, labour relations in Zimbabwe have been rocked by endless salary disputes and retrenchments, as the economy has not been performing well owing to a decade- long economic stagnation and hyperinflation. The introduction of the multi-currency regime in during the first quarter of 2009 brought some long awaited relief to the economy but most companies operating within both the productive and retail sectors are still battling.
Figure A below summarizes how it has become a loosing battle for all stakeholders, including the very NECs who would have engineered the cycle leading to the “killing process of the goose that lays the golden egg.”
The goose are the employees who if they loose their employment as a result of mechanization to minimize labour relations troubles, amongst other issues and retrenchments because employers cannot afford the higher wages the NECs are demanding, the NECs would have depleted the very catchment pool of employees that they rely on for their fee income.
Figure A - NECs: Killing the Goose
Implications for decision making
At a 2010 British Council Management Express thought leadership seminar held in Harare, in August 2010, renowed economist and University of Zimbabwe’s Graduate School of Management academic Professor Tony Hawkins addressing delegates in a presentation entitled ‘The New Normal: Implications for business decision-making in Zimbabwe 2010’, identified six areas where Zimbabwe’s New Normal can best be understood as follows: market size; skills; finance and capital; foreign exchange; infrastructure (both hard and soft); and institutions.
What might be of major interest to delegates in this conference are the key observations made by Hawkins in relation to skills, wages and labour productivity.
With specific regards to skills, Hawkins noted that Zimbabwe used to be “well-endowed with skills with a strong educational and training sector.” There has been a “severe brain-drain which has also adversely affected the education sector that no longer has the capacity to regenerate skills.” Today, skills shortages are becoming manifest in specialist areas such as “tobacco and horticulture production, surveying, geology etc.” On the other hand, we have seen some sectors like the public services and municipal services sector having bloated workforce structures which are proving to be unsustainable.
With specific focus on wages and productivity, Hawkins argues that old model where “wage awards that were driven by what employees needed to survive on rather than their productivity” is not sustainable under the New Normal of dollarization. To buttress this point, Hawkins cited a new World Bank report which estimates industrial wages for casual labour at $215 a month in Zimbabwe compared with $129 in Zambia and $67 in Malawi. Hawkins further contended that “where the exchange rate is fixed or externally determined” business costs and productivity must adjust accordingly underscoring the fact that “wages must be linked to productivity”. [iii]
The way forward for Zimbabwe
1. Link remuneration to productivity
2. Link wages and productivity to competitiveness
3. Reconstitute the NECs and make them more accountable to key stakeholders
4. Strengthen the Workers’ Councils through education and training
5. Perhaps government is the missing link. Would a tripartite agreement between government, labour and industry.
ANNEXURE
Is Zimbabwe competitive?[iv]
Is Zimbabwe competitive? Are all facets of Zimbabwe’s economic sectors competitive? Are Zimbawe companies competitive? With the globalization of markets, the increased mobility of corporate assets, and the need for productive human resources, this question has become all the more complex to answer. It is important to answer this question so that we are able to tackle questions on certain fundamentals such as: financial performance and labor productivity.
We have to be interested in the degree to which firms operating in Zimbabwe have fundamentally different financial structures and performance compared to firms located elsewhere.
We have to be interested in the degree to which firms operating in Zimbabwe have fundamentally different financial structures and performance compared to firms located elsewhere.
With respect to financial competitiveness we have to ask the following questions:
- If one were to invest or operate in Zimbabwe, how would the firm’s asset structure likely vary compared to a firm operating in some other country in Africa or average location in the world?
- In Zimbabwe, do firms typically hold more cash and other short term assets, or do they concentrate their assets in physical plant and equipment?
- On the liability side, do firms operating in Zimbabwe have a higher percent of payables compared to other firms operating in Africa, or do they hold a higher concentration of long term debt?
- The structure of the income statement is also telling.
- Do firms operating in Zimbabwe have relatively higher costs of goods sold, operating costs, or income taxes compared to firms located elsewhere in the region or the world in general?
- Are returns on equity higher in Zimbabwe?
- Are profit margins greater?
- Are inventories held longer?
In many instances, people make all the difference. In addition to financial competitiveness, it is crucial to assess labour competitiveness by considering the extent to which labor deployment and productivity in Zimbabwe differs from regional and global benchmarks. In this case, we have to be interested in the amount of labor required to operate a typical business in Zimbabwe and the likely returns on this human investment. Questions to be asked include the following:
- What is the typical ratio of short-term and long-term assets to employee?
- What are typical capital-labor ratios?
- How different are these ratios to those in Africa in general and the world as a whole?
- What are the average sales and net profits per employee in Zimbabwe compared to regional benchmarks?
Again, these and over 50 other measures of labor productivity have to be considered with a view to assisting managers in gauging the competitive performance of Zimbabwe at the global level. With the globalization of markets, greater foreign competition, and the reduction of entry barriers, it becomes all the more important to benchmark Zimbabwe against other countries on a worldwide basis.
The exercise of generating international benchmarks and measuring gaps is not an obvious task. We first, need to aggregate across firms in Zimbabwe. Second, we need to control for exchange rate volatility by eliminating all currency effects and finally, comparable financial standards and comparable categories such as assets, liabilities, income and ratios by country, region and on a worldwide basis ought to be used.
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