IN his State of the Nation address, President Emmerson Mnangagwa highlighted a number of areas where human resources can play a part. The human resources implications are all derived from the business imperatives also highlighted in the same statement.
The President indicated that “Zimbabwe is open for business.” We are likely to get investors from all corners of the globe setting up companies, and in the process bringing in their national cultures. Whenever new investors set up big business they always want the senior management to be theirs including, in some instances, technical people. This normally results in clashes with locals, who normally expect to lead these organisations. It is, therefore, important for Zimbabweans to note that when investors bring in senior management and technical skills, this is good for the development of management practices through skills transfers.
Besides the issues raised above, there is a possibility of cultural conflicts. In his studies of national cultures, Hofstede (1997) indicates that national cultures differ on the following dimensions: Power distance, individualism, uncertainty avoidance and long-term orientation. Most European countries and the USA have high individualism which is likely to clash with our collectivism orientation. Other clashes are likely to be on power distance where Zimbabwe is very high compared to these countries. Most of these countries are high on long-term orientation while we are oriented towards there “here and now”. Are human resources professionals ready to handle and manage the likely culture conflicts? Those who work in embassies locally will tell you that these culture conflicts are real and affect employee productivity. We have heard stories of locals clashing with the Chinese management in many companies. In some cases, locals take the conflicts as racism. With better planning and cultural induction of foreigners coming into the country, we have a better chance of managing such conflicts.
According to research by McKinsey (2007) in conjunction with the Centre for Economic Performance at the London School of Economics and Partners from Stanford and Harvard universities (2007) better managed organisations report higher productivity and resilience to negative economic swings. In the same study they note that multinationals across all countries studied tend to be more productive than local firms. They have superior knowhow and technology. According to the same study, countries with more multinationals tend to perform better than those without. It is noted that the competition that multinationals bring to the local market forces domestic players to improve their own productivity ― driving down prices, increasing demand and creating more choices for customers.” So we hope the President’s call that “Zimbabwe is open for business” will bring all the benefits that come with multinationals. It is not a coincidence that when we started chasing away multinationals that is when the economy started going down. The not-so-good success of most indigenous companies points to poor management as the main cause.
The opening up of Zimbabwe to new investors could also signal freedom for employees who have been stuck for years with employers who have not looked after them. A lot of employers got fooled by the low staff turnover experienced over the past years. It is not because they are doing anything wonderful. It is because employees had no choice. However, this new dispensation could mean employees will have more choices. Human resources professionals need to build employer brands that are able to retain good employees in both good and bad times.
The President talked about “productivity and capacity utilisation across all sectors; enhancing foreign currency earnings.” This is a very important call but with so much challenges.
The OECD defines country or national competitiveness as “the degree to which a country can, under free and fair market conditions, produce goods and services which match the rest of the international markets, while simultaneously maintaining and expanding the real incomes of its people over the long term.”
It is known and it has always been known that Zimbabwean products are uncompetitive for various reasons. The reasons can be traced directly to low productivity. Our companies have largely depended on price to make money; rendering them uncompetitive. Producers and suppliers are equally culpable. This is evident in the way local businesses fail to pass on the benefits of input price reductions to customers. What is evident is greed and profiteering honed in during the last two decades. Capacity utilisation, which I see industry focusing on, is just but one component impacting on productivity. To a larger extent, it has nothing to do with efficient use of resources which is at the centre of productivity improvement and competitiveness.
Industry’s major thrust has been to increase capacity utilisation with the hope that it will increase competitiveness. This strategy, which has been tried many times, will not result in Zimbabwean products being competitive. What is required is innovation around major cost drivers such as electricity, water and labour. Wages cannot be a limitation: I know our wage system is a hindrance considering that our NEC recommended wages are not in line with productivity. In Zimbabwe, on average the minimum wage is less than $2 per hour, but in the highly competitive markets it is between $13 and $18 an hour, but they still produce competitively. This could be that they have looked at other areas for productivity enhancement e.g. technology driven improvements.
Most people, including those in high office, celebrate a rise in production and equate it to productivity. Productivity has to do with the efficient use of resources to produce products and services that the market is willing to pay for. There are companies that have 100 percent capacity utilisation, but are very unproductive. There are companies that are exceeding their production targets but are also highly unproductive.
The second myth is that people think that every company that is profitable must be highly productive. While that logically makes sense, in practice it does not follow. Profitability in companies can change for reasons that have little to do with productivity ― for example, upward increase in product price.
We must accept that we cannot regulate ourselves to competitiveness. Even if the government was to protect every local product, we would still fail to export because we are very unproductive. Poor leadership and misuse of resources affect productivity and competitiveness.
On the issue of skills, we are far behind other countries. Those who think we have the skills are not looking at facts on the ground reflected in how some local companies are performing despite resources being poured into them. My view is that we are celebrating yesteryear glory that is not supported by facts. The President said we are 20 years behind in development ― it is true we are 20 years behind in skills, technology, governance, leadership etc.
Studies have shown that the level of IQ (71 to 80) of our citizens is far behind that of other countries including some in Africa. Zimbabwe is ranked #115 out of 119 on The Global Talent Competitiveness Index (2018). Zimbabwe is ranked #119 out of 128 countries on the Intelligence Capital Index measures (Chan 2017).
All the above indices have a high correlation with economic development indicators. What other proof do we need.
Memory Nguwi is an occupational psychologist, data scientist, speaker, and managing consultant at Industrial Psychology Consultants (Pvt) Ltd, a management and human resources consulting firm. https://www.linkedin.com/in/memorynguwi/ Phone +263 4 481946-48/481950/2900276/2900966 or cell number +263 77 2356 361 or email: firstname.lastname@example.org or visit our website at www.ipcconsultants.com