Friday, October 23, 2020

Botswana’s Private Sector through the eyes of Sid Boubekeur

Sid Boubekeur, a French National may most likely come to be known in the history books of Botswana for his role that would be seen as the initial guiding steps to an established and impactful small and medium enterprises sector in the country. Boubekeur served as the Head for the CDE Regional Office for Southern Africa based in Botswana. SUNDAY STANDARD’s TLOTLO LEMMENYANE chit-chat with him on a number of issues affecting private sector. 

Boubekeur arrived in Botswana in 2009 answering a call to action in finding and stimulating the growth points of SMMEs, a mission he told Sunday Standard that he renewed his eye to every day, “we are not the same as yesterday,” he recounted regularly saying to his team.  

He narrated that his first contact was with the main intermediary organizations, which include in the list Local Enterprise Authority (LEA), Business Botswana (BB) and Botswana Investment and Trade Centre (BITC) because of their existing interaction with the private sector. It was after he met with some companies in 2009 as part of the situational analysis exercise, he said, that he found out that the sector had too many small scale companies parallel to fewer big multinational companies, which exposed a gap: the absence of intermediary companies. The absence of medium enterprises morphed in his mind as a challenge, to improve the capacity of smaller scale enterprises so that they grow into medium companies. This early finding resulted in a capacity analysis from which he identified that the smaller scale enterprises were facing a crucial challenge of management, which was evidenced through the owners spending little time with their enterprises. He would deduce from that it was probably because the owners owned several companies which he surmised was to limit the risk of owning just one company. He also observed that the relationship between the product and the market was misaligned, estimating that about 90 percent enterprises consider the production of goods without first analyzing the linkages between the product, market and competition. This, he conferred, begets financial distress, particularly relating to inaccessibility of financing from a bank as such enterprises fail to meet minimum conditions demanded by banks of good management and proven product market. Another common mistake he came to know of the enterprises was the oblivion to product enhancement, which in part demonstrated a lack of innovation. “We produce, we sell without monitoring the progress, weaknesses on how to further develop the product,” to which he warned that survival becomes minimal without innovation.  On the other hand, moving away from the deficiencies of enterprise owners, an audit to identify the weaknesses, strengths and potential of the private sector identified an inherent problem of a limited market in Botswana, which as a consequence hindered enterprises from realizing economies of scale. Notwithstanding the disadvantage, Botswana possesses strength in terms of minimum conditions required to be met in starting a business, which he attributed largely to the existence of various support structures. 

Close to a hundred SMMEs were identified for participation in the audit process which showed where they might be falling short, and where small interventions could give the beneficiaries the necessary skills and focus to overcome their business challenges, cites the PSDP final draft report. Now in 2016 looking back to the initial situation analysis, Boubekeur spots the difference. “I see some changes on the approach of SMMEs, at least those we support,” he said. He attributed the results to the contribution made by international enterprises in analyzing the local enterprises’ products, from which they provided advice and action plan, “we will soon some impact,” he said. 

“I’m optimistic that from 100, maybe only 30 will emerge and could lead, our goal is that companies follow the best, we hope we could have a minimum 30 companies which could be what we call ‘reference companies.’ One of the objectives is to take these 30 companies to mentor the others, if they’re from the same sector it’s their interest to see the sector grow; very important to engage companies of the same sector which could play a role of mentorship. At the end what is important is the growth of the sector, it’s not only the growth of the company,” he said. 

Boubekeur opined, a statement likely to be a hard pill for the local enterprises to swallow, that entrepreneurs in Botswana have become very attached to the support structures so much that they seem divorced from the ability to operate independently. He lauded organizations such as LEA which through their tool kit train and support SMMEs which he said come from nothing, an exercise he deemed close to impossible, “organizations in Botswana are implementing their mandate,” he said, adding that they work symbiotically without competing with each other, a relationship which PSDP established interaction from to provide further linkages.  The challenge, he said, rests on SMMEs to take advantage of the support structures because the environment could potentially change. “What is missing is SMMEs catching the assets, knowledge of these organizations. Maybe they get too much (support). Among 100 companies, you’ll find maybe 15 percent which get the support of LEA, which get the support of CEDA, now they get the support of PSDP, they want again more. Frankly we can’t build a business like that,” he said. An encounter he shared was that after visiting SMMEs which presented 1000 challenges, from which the solution they suggested normally was “we’ll request CEDA to put more money,” he then realized that inciting shock in them could make them think outside. “Close,” he demanded of them, “if you have 1000 challenges, why still operate? So just close,” he instructed them. The reaction from the SMMEs was how he provoked debate, because in the SMMEs mind was an expectation that help will fall from somewhere. “SMMEs have to shake themselves up, it’s the most weakness part, it’s where we have to work, majority are always expecting. Managers have to take risks, do innovation and need to know when to cut the umbilical cord,” he said.    

“The start of a company is to take risk,” a trait which however he observed that a majority of SMMEs in Botswana do not apply. “I think all problem is here ÔÇô why they don’t take risk? Because the risk is covered,” he said. 

When the time came to leave Botswana in March 2016, ceding PSDP to BB, Boubekeur at his appreciation dinner heartily conveyed that something Botswana possesses that is hard to find anywhere else in the world is peace, a trait he asked Botswana to guard very closely.   

BB had previously worked closely with Boubekeur on PSDP, involved specifically in monitoring and evaluation, but however his departure saw the orderly transfer of the program from CDE to BB, which occurred in November 2015. Taking over the baton BB, in partnership with EU Delegation, MITI, MFDP, postulates that “continuous improvement, close monitoring of projects and regular feedback, adopting a culture of monitoring, evaluation and learning,” will maintain the success trajectory PSDP. According to BB CEO Dr. Racious Moatshe BB has now adopted the use of tools such as work plans to ensure an orderly roll-out of activities. He advised that SMMEs should strengthen their internal capacity and capabilities to enhance growth and sustainability.  “BB is of the view that effective capacity building will eventually lead to improvement in profit margins thus creating employment for the private sector. Through M&E (monitoring and evaluation) a preliminary evaluation is giving a positive picture. The challenge is for the entrepreneurs themselves to maintain their attitude in line with what they learnt from various interventions,” Dr. Moatshe posited. 

Dr. Moatshe reiterated the efforts of government, evidenced through the support structure offered by various intermediary organizations, in fostering entrepreneurial development but also identified that there is still a long way to go in order to make starting and running businesses easier, as well as facilitating trade and creating policies that allow companies to grow. “Despite these challenges, the spirit of entrepreneurship still exists in most companies,” he advanced. 

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