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Friday, 19 April 2024

Diamond beneficiation: Will the bubble burst?

Opinions


Just a few questions to note: Have we done our groundwork on sustaining this industry? Is our approach not flawed?


Last year, before the October elections I penned an article on education for citizen empowerment which I never published, but the current challenges in the diamond beneficiation industry has provoked me to revisit that article which I have abridged for this submission.   We must appreciate that; it is more than just ‘bringing our jobs back’ as some say. It is more complex. It is doing the necessary ground work with targeted investment on human capital for creation of permanent and sustainable businesses and jobs.


The closure of diamond beneficiation factories in Serowe and Gabane has left hundreds of our people jobless and in a state of confusion. This is not surprising because we have not built a foundation on which we can sustain these industries especially that we are not able to compete with the very best in the industry internationally and more importantly that we have not built-in legal protection for the industry.


I titled my paper, Education, Skilling, Training, Lifelong Learning, Professional Development and Citizen Empowerment which I have abridged below to suit.


It was interesting to see that during the build up to the elections political parties’ views on education were somewhat converging. The UDC and BCP wanted to divide the ministry of education into two and to introduce education for production.  Mma Moitoi of the BDP admitted last year that the ministry was too big and that it needed to be divided. BDP also seem to have been converted to education for production, but I doubt if they really understand what this education is all about judging by their failure to implement the Kedikilwe’s National Commission on Education recommendations of 1993.


It is however, encouraging to see that as a nation we seem to be seeing the need for in-depth reforms in our education system. These reforms should be informed by our understanding that education is a foundation as well as a catalyst for our economic development.  We are hopeful that the parties will work together for a world class educational system that will propel our economy to higher levels of growth. Together as nation we can and should develop this educational system to ensure that our people are placed at the helm to drive our development at a much more accelerated pace.  


With a background from industry and a sound understanding of the business needs in Botswana, I am certain that no business would like to hire an employee who is not ready to make a positive difference to the business bottom line. No business would like to spend inordinate amount of time and money training someone before getting value for their money.  It is a fact that basic education at whatever level is not enough to produce an employee who is industry ready.  Basic education is only a foundation on which to build the requisite skills required by industry.  Certificates, diplomas, degrees or even doctorate degrees if not accompanied by practical skills for the job are not adequate for any business.


Debswana recognised this long ago.  Under the leadership of the late Rre Nchindo, Debswana developed a model where students were sent to some of the best universities and colleges in the world and then given practical training on the job including specialised courses from recognised institutions before being appointed to positions of responsibility.  He further developed in house technical colleges and training facilities for focused training.  This produced a result oriented and a motivated workforce.


 We can learn a lot from the Debswana approach.  The practical skills and work ethics by and large are obtained from industry, by practicing on the job and being given relevant training around the specific job by attending specialised courses.  Ideally these practical skills should be provided along side the theoretical studies.  In most developed or developing countries, they have sandwich courses, where students are given time to work in industry to apply their theoretical knowledge and gain practical experience. The practical training is defined and assessed by both industry and the learning institution.  


Our government needs to engage other political parties, business and workers unions. Together they should unpack what education for production entails and map the implementation process. This will require adequate resources and a leadership that will inspire and provide an enabling environment for success. There was talk of lifelong learning during the last election. There should be lifelong learning geared at developing a person to be good at what they do on the job. There is also lifelong learning for developing the individual to be a better member of society.


We want our people to learn specific skills that will help them grow as individuals to avoid the perennial situation of having many ‘educated’ people roaming the streets without jobs and complaints from industry that the education system does not provide the necessary skills.  We need to avoid situations were our houses, offices, schools, stadia, airports, dams, roads and industries are built by foreigners while our educated people are in the streets as onlookers. Foreigners are required only to help Batswana where there is need and Batswana doing the work, driving long term strategies and manning key positions.


We must accept that our current approach on human development is flawed. We have unwittingly spent millions if not billions of tax payer’s money annually developing outsiders at the expense of our own people.


Now coming to diamond beneficiation!  When you go to a foreign country and ask businessmen to come and set up factories in your country, what do you expect these people to do?  Remember, these people are looking for opportunities to expand their businesses and create jobs for their own people. You are therefore inviting them to come and empower themselves and their own people in your country. They will bring their own money, their own people, their own food etc. They will only employ a handful of Batswana in menial jobs. All the money made will be repatriated to their country of origin.  After making enough money, they will pack their bags and go back leaving your people jobless!  Are you surprised that the factories in Serowe and Gabane have closed?


I listened with keen interest to the minister of mines (Rre Mokaila) last year in America when he was addressing a packed diamond business conference. He did well in putting our country on the world map.   He invited businesses to come and set up in Botswana and create jobs for Batswana.  This has been on going for years and how many sustainable jobs have been created? How much money has been spent on bringing these companies to Botswana? How much money has been made and repatriated by these companies? Who has really benefited from these ventures?


What progressive countries do is very different.  They empower their own people to take advantage of specific economic opportunities in their country and the world around them. They identify international strategic partners who will partner with their own people to take advantage of these economic opportunities.  Their focus is as much inward as it is outward so that they are able to effectively play in both local and international markets.  They sponsor their own people to work in foreign countries to gain the necessary experience and expertise.


Diamond beneficiation is an area with huge economic potential and social benefits. There are many countries who import raw diamonds for beneficiation. These countries do not have a single diamond mine and have developed their countries with our diamonds and we can learn a lot from them. We should identify these countries, find out how they have developed the industry and show our interest in partnering with them.  We assure them that we will provide some incentives for them to set up in Botswana once we are ready to meaningfully partner with them.  


We then screen and sponsor our graduates especially the young to go and study and work in the diamond industry in these countries. This is where the best people in the industry are. Our people will work in these industries for a period that will allow them to appreciate the success factors before returning home.  Once our people are fully trained in the various diamond business skills (technical skills, financing, leadership, ICT, business ethics etc) and are ready, government can then bring the diamond technical partner to collaborate with government development agency with a view to empower these people to  help built and eventually take over.


This will ensure that we have a pool of technocrats and entrepreneurs who can contribute meaningfully in the diamond industry.  Without ownership of the diamond industry by locals, the industry will never grow. Eventually all the factories will relocate back to India, Dubai, Israel and other countries.  We have a unique opportunity to make our diamond industry world class, but we have to change our approaches.


E-mail:  bernard.busani@gmail.com:   cell: 71751440

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Opinions

IEC Disrespects Batswana: A Critical Analysis

10th November 2023

The Independent Electoral Commission (IEC) has recently faced significant criticism for its handling of the voter registration exercise. In this prose I aim to shed light on the various instances where the IEC has demonstrated a lack of respect towards the citizens of Botswana, leading to a loss of credibility. By examining the postponements of the registration exercise and the IEC’s failure to communicate effectively, it becomes evident that the institution has disregarded its core mandate and the importance of its role in ensuring fair and transparent elections.

Incompetence or Disrespect?

One possible explanation for the IEC’s behavior is sheer incompetence. It is alarming to consider that the leadership of such a critical institution may lack the understanding of the importance of their mandate. The failure to communicate the reasons for the postponements in a timely manner raises questions about their ability to handle their responsibilities effectively. Furthermore, if the issue lies with government processes, it calls into question whether the IEC has the courage to stand up to the country’s leadership.

Another possibility is that the IEC lacks respect for its core clients, the voters of Botswana. Respect for stakeholders is crucial in building trust, and clear communication is a key component of this. The IEC’s failure to communicate accurate and complete information, despite having access to it, has fueled speculation and mistrust. Additionally, the IEC’s disregard for engaging with political parties, such as the Umbrella for Democratic Change (UDC), further highlights this disrespect. By ignoring the UDC’s request to observe the registration process, the IEC demonstrates a lack of regard for its partners in the electoral exercise.

Rebuilding Trust and Credibility:

While allegations of political interference and security services involvement cannot be ignored, the IEC has a greater responsibility to ensure its own credibility. The institution did manage to refute claims by the DISS Director that the IEC database had been compromised, which is a positive step towards rebuilding trust. However, this remains a small glimmer of hope in the midst of the IEC’s overall disregard for the citizens of Botswana.

To regain the trust of Batswana, the IEC must prioritize respect for its stakeholders. Clear and timely communication is essential in this process. By engaging with political parties and addressing their concerns, the IEC can demonstrate a commitment to transparency and fairness. It is crucial for the IEC to recognize that its credibility is directly linked to the trust it garners from the voters.

Conclusion:

The IEC’s recent actions have raised serious concerns about its credibility and respect for the citizens of Botswana. Whether due to incompetence or a lack of respect for stakeholders, the IEC’s failure to communicate effectively and handle its responsibilities has damaged its reputation. To regain trust and maintain relevance, the IEC must prioritize clear and timely communication, engage with political parties, and demonstrate a commitment to transparency and fairness. Only by respecting the voters of Botswana can the IEC fulfill its crucial role in ensuring free and fair elections.

 

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Opinions

Fuelling Change: The Evolving Dynamics of the Oil and Gas Industry

4th April 2023

The Oil and Gas industry has undergone several significant developments and changes over the last few years. Understanding these developments and trends is crucial towards better appreciating how to navigate the engagement in this space, whether directly in the energy space or in associated value chain roles such as financing.

Here, we explore some of the most notable global events and trends and the potential impact or bearing they have on the local and global market.

Governments and companies around the world have been increasingly focused on transitioning towards renewable energy sources such as solar and wind power. This shift is motivated by concerns about climate change and the need to reduce greenhouse gas emissions. Africa, including Botswana, is part of these discussions, as we work to collectively ensure a greener and more sustainable future. Indeed, this is now a greater priority the world over. It aligns closely with the increase in Environmental, Social, and Governance (ESG) investing being observed. ESG investing has become increasingly popular, and many investors are now looking for companies that are focused on sustainability and reducing their carbon footprint. This trend could have significant implications for the oil and fuel industry, which is often viewed as environmentally unsustainable. Relatedly and equally key are the evolving government policies. Government policies and regulations related to the Oil and Gas industry are likely to continue evolving with discussions including incentives for renewable energy and potentially imposing stricter regulations on emissions.

The COVID-19 pandemic has also played a strong role. Over the last two years, the pandemic had a profound impact on the Oil and Gas industry (and fuel generally), leading to a significant drop in demand as travel and economic activity slowed down. As a result, oil prices plummeted, with crude oil prices briefly turning negative in April 2020. Most economies have now vaccinated their populations and are in recovery mode, and with the recovery of the economies, there has been recovery of oil prices; however, the pace and sustainability of recovery continues to be dependent on factors such as emergence of new variants of the virus.

This period, which saw increased digital transformation on the whole, also saw accelerated and increased investment in technology. The Oil and Gas industry is expected to continue investing in new digital technologies to increase efficiency and reduce costs. This also means a necessary understanding and subsequent action to address the impacts from the rise of electric vehicles. The growing popularity of electric vehicles is expected to reduce demand for traditional gasoline-powered cars. This has, in turn, had an impact on the demand for oil.

Last but not least, geopolitical tensions have played a tremendous role. Geopolitical tensions between major oil-producing countries can and has impacted the supply of oil and fuel. Ongoing tensions in the Middle East and between the US and Russia could have an impact on global oil prices further, and we must be mindful of this.

On the home front in Botswana, all these discussions are relevant and the subject of discussion in many corporate and even public sector boardrooms. Stanbic Bank Botswana continues to take a lead in supporting the Oil and Gas industry in its current state and as it evolves and navigates these dynamics. This is through providing financing to support Oil and Gas companies’ operations, including investments in new technologies. The Bank offers risk management services to help oil and gas companies to manage risks associated with price fluctuations, supply chain disruptions and regulatory changes. This includes offering hedging products and providing advice on risk management strategies.

Advisory and support for sustainability initiatives that the industry undertakes is also key to ensuring that, as companies navigate complex market conditions, they are more empowered to make informed business decisions. It is important to work with Oil and Gas companies to develop and implement sustainability strategies, such as reducing emissions and increasing the use of renewable energy. This is key to how partners such as Stanbic Bank work to support the sector.

Last but not least, Stanbic Bank stands firmly in support of Botswana’s drive in the development of the sector with the view to attain better fuel security and reduce dependence risk on imported fuel. This is crucial towards ensuring a stronger, stabler market, and a core aspect to how we can play a role in helping drive Botswana’s growth.  Continued understanding, learning, and sustainable action are what will help ensure the Oil and Gas sector is supported towards positive, sustainable and impactful growth in a manner that brings social, environmental and economic benefit.

Loago Tshomane is Manager, Client Coverage, Corporate and Investment Banking (CIB), Stanbic Bank Botswana

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Opinions

Brands are important

27th March 2023

So, the conclusion is brands are important. I start by concluding because one hopes this is a foregone conclusion given the furore that erupts over a botched brand. If a fast food chef bungles a food order, there’d be possibly some isolated complaint thrown. However, if the same company’s marketing expert or agency cooks up a tasteless brand there is a country-wide outcry. Why?  Perhaps this is because brands affect us more deeply than we care to understand or admit. The fact that the uproar might be equal parts of schadenfreude, black twitter-esque criticism and, disappointment does not take away from the decibel of concern raised.

A good place to start our understanding of a brand is naturally by defining what a brand is. Marty Neumier, the genius who authored The Brand Gap, offers this instructive definition – “A brand is a person’s gut feel about a product or service”. In other words, a brand is not what the company says it is. It is what the people feel it is. It is the sum total of what it means to them. Brands are perceptions. So, brands are defined by individuals not companies. But brands are owned by companies not individuals. Brands are crafted in privacy but consumed publicly. Brands are communal. Granted, you say. But that doesn’t still explain why everybody and their pet dog feel entitled to jump in feet first into a brand slug-fest armed with a hot opinion. True. But consider the following truism.

 

Brands are living. They act as milestones in our past. They are signposts of our identity. Beacons of our triumphs. Indexes of our consumption. Most importantly, they have invaded our very words and world view. Try going for just 24 hours without mentioning a single brand name. Quite difficult, right? Because they live among us they have become one of us. And we have therefore built ‘brand bonds’ with them. For example, iPhone owners gather here. You love your iPhone. It goes everywhere. You turn to it in moments of joy and when we need a quick mood boost. Notice how that ‘relationship’ started with desire as you longingly gazed upon it in a glossy brochure. That quickly progressed to asking other people what they thought about it. Followed by the zero moment of truth were you committed and voted your approval through a purchase. Does that sound like a romantic relationship timeline. You bet it does. Because it is. When we conduct brand workshops we run the Brand Loyalty ™ exercise wherein we test people’s loyalty to their favourite brand(s). The results are always quite intriguing. Most people are willing to pay a 40% premium over the standard price for ‘their’ brand. They simply won’t easily ‘breakup’ with it. Doing so can cause brand ‘heart ache’. There is strong brand elasticity for loved brands.

 

Now that we know brands are communal and endeared, then companies armed with this knowledge, must exercise caution and practise reverence when approaching the subject of rebranding. It’s fragile. The question marketers ought to ask themselves before gleefully jumping into the hot rebranding cauldron is – Do we go for an Evolution (partial rebrand) or a Revolution(full rebrand)? An evolution is incremental. It introduces small but significant changes or additions to the existing visual brand. Here, think of the subtle changes you’ve seen in financial or FMCG brands over the decades. Evolution allows you to redirect the brand without alienating its horde of faithful followers. As humans we love the familiar and certain. Change scares us. Especially if we’ve not been privy to the important but probably blinkered ‘strategy sessions’ ongoing behind the scenes. Revolutions are often messy. They are often hard reset about-turns aiming for a total new look and ‘feel’.

 

 

Hard rebranding is risky business. History is littered with the agony of brands large and small who felt the heat of public disfavour. In January 2009, PepsiCo rebranded the Tropicana. When the newly designed package hit the shelves, consumers were not having it. The New York Times reports that ‘some of the commenting described the new packaging as ‘ugly’ ‘stupid’. They wanted their old one back that showed a ripe orange with a straw in it. Sales dipped 20%. PepsiCo reverted to the old logo and packaging within a month. In 2006 Mastercard had to backtrack away from it’s new logo after public criticism, as did Leeds United, and the clothing brand Gap. AdAge magazine reports that critics most common sentiment about the Gap logo was that it looked like something a child had created using a clip-art gallery. Botswana is no different. University of Botswana had to retreat into the comfort of the known and accepted heritage strong brand.  Sir Ketumile Masire Teaching Hospital was badgered with complaints till it ‘adjusted’ its logo.

 

 

So if the landscape of rebranding is so treacherous then whey take the risk? Companies need to soberly assess they need for a rebrand. According to the fellows at Ignyte Branding a rebrand is ignited by the following admissions :

Our brand name no longer reflects our company’s vision.
We’re embarrassed to hand out our business cards.

Our competitive advantage is vague or poorly articulated.
Our brand has lost focus and become too complex to understand. Our business model or strategy has changed.
Our business has outgrown its current brand.
We’re undergoing or recently underwent a merger or acquisition. Our business has moved or expanded its geographic reach.
We need to disassociate our brand from a negative image.
We’re struggling to raise our prices and increase our profit margins. We want to expand our influence and connect to new audiences. We’re not attracting top talent for the positions we need to fill. All the above are good reasons to rebrand.

The downside to this debacle is that companies genuinely needing to rebrand might be hesitant or delay it altogether. The silver lining I guess is that marketing often mocked for its charlatans, is briefly transformed from being the Archilles heel into Thanos’ glove in an instant.

So what does a company need to do to safely navigate the rebranding terrain? Companies need to interrogate their brand purpose thoroughly. Not what they think they stand for but what they authentically represent when seen through the lens of their team members. In our Brand Workshop we use a number of tools to tease out the compelling brand truth. This section always draws amusing insights. Unfailingly, the top management (CEO & CFO)always has a vastly different picture of their brand to the rest of their ExCo and middle management, as do they to the customer-facing officer. We have only come across one company that had good internal alignment. Needless to say that brand is doing superbly well.

There is need a for brand strategies to guide the brand. One observes that most brands ‘make a plan’ as they go along. Little or no deliberate position on Brand audit, Customer research, Brand positioning and purpose, Architecture, Messaging, Naming, Tagline, Brand Training and may more. A brand strategy distils why your business exists beyond making money – its ‘why’. It defines what makes your brand what it is, what differentiates it from the competition and how you want your customers to perceive it. Lacking a brand strategy disadvantages the company in that it appears soul-less and lacking in personality. Naturally, people do not like to hang around humans with nothing to say. A brand strategy understands the value proposition. People don’t buy nails for the nails sake. They buy nails to hammer into the wall to hang pictures of their loved ones. People don’t buy make up because of its several hues and shades. Make up is self-expression. Understanding this arms a brand with an iron clad clad strategy on the brand battlefield.

But perhaps you’ve done the important research and strategy work. It’s still possible to bungle the final look and feel.  A few years ago one large brand had an extensive strategy done. Hopes were high for a top tier brand reveal. The eventual proposed brand was lack-lustre. I distinctly remember, being tasked as local agency to ‘land’ the brand and we outright refused. We could see this was a disaster of epic proportions begging to happen. The brand consultants were summoned to revise the logo. After a several tweaks and compromises the brand landed. It currently exists as one of the country’s largest brands. Getting the logo and visual look right is important. But how does one know if they are on the right path? Using the simile of a brand being a person – The answer is how do you know your outfit is right? It must serve a function, be the right fit and cut, it must be coordinated and lastly it must say something about you. So it is possible to bath in a luxurious bath gel, apply exotic lotion, be facebeat and still somehow wear a faux pas outfit. Avoid that.

Another suggestion is to do the obvious. Pre-test the logo and its look and feel on a cross section of your existing and prospective audience. There are tools to do this. Their feedback can save you money, time and pain. Additionally one must do another obvious check – use Google Image to verify the visual outcome and plain Google search to verify the name. These are so obvious they are hopefully for gone conclusions. But for the brands that have gone ahead without them, I hope you have not concluded your brand journeys as there is a world of opportunity waiting to be unlocked with the right brand strategy key.

Cliff Mada is Head of ArmourGetOn Brand Consultancy, based in Gaborone and Cape Town.

cliff@armourgeton.com

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