The Sunday Mail
Taurai Changwa
Effective leadership requires both interpersonal skills and business acumen. Even the most dynamic and well-liked leaders are likely to flounder if they lack overall business sense.
Perceptions in the world of business are very important insofar as they shape investment decisions.
This is why there is a positive correlation between an accommodative business environment and rising foreign direct investment.
But local businesses and businesspersons are the front office of the country’s investment environment.
They provide the most practical platform to measure how sustainable an investment can be.
It therefore becomes very sad and disturbing when a foreign investor becomes the victim of a dishonest local partner.
While Government, through the empowerment law, has tried to deliberately give local businessmen a stake in the local economy, the empowered groups should naturally oblige by conducting business in the best way they know how.
The world over, brands gain value through the promise that lies behind them, and most often than not it is a promise of quality and integrity.
It naturally gives rise to strong brand equity (the commercial value that is ascribed to the consumer perception of a brand name).
For example, last year American-based international brand consultancy firm, Interbrand, ranked Apple and Google the most valuable brands, with brand values of US$178 billion and US$133 billion, respectively.
Coca-Cola was ranked third at US$73,1 billion.
Just as in the private sector, investors also rank the quality of destinations in which investments are channelled.
And just because Government has come up with a policy framework that is biased towards locals, this does not mean it condones shortchanging foreign investors.
It is now a growing cancer.
There are now several cases where foreign investors have injected funds into local projects only to discover that they were not committed to the intended use, but for personal gain.
Such behaviour is unacceptable for it is damaging to the national brand.
There should be a policy framework through which foreign investors are protected from predatory local businessmen who are just in it to fleece investors.
But this short-term gain only results in long-term pain for the country. Having the assets of such criminal elements attached and auctioned wont be a bad idea.
Everyone has the responsibility to contribute to the development of the country. The negative publicity that is often generated in cases where investors are duped has a negative feedback loop in source markets for investment.
The importance of foreign investment cannot be overemphasised.
Not only does it bring in new businesses and additional export opportunities, it also encourages competition and increased innovation.
It is unfair to view foreign investors as money-spinning machines that can be harnessed to finance ostentatious lifestyles of local businessmen.
They actually invest to get a reasonable return.
It is time to invest in a new breed of businessmen who value hard work and integrity. Local business partners should be transparent and accountable to the foreign partner.
Effective leadership requires both interpersonal skills and business acumen. Even the most dynamic and well-liked leaders are likely to flounder if they lack overall business sense.
That’s because without a clear understanding of how business works, their goals are likely to ring hollow.
A gold claim amounts to nothing if it is not being worked; its value can only be realised if it is optimally exploited.
In an interlinked and globalised world, locals should be increasingly wary of how their decisions are likely to affect others.
It’s about seeing the “big picture” and the interdependency of decisions and how they combine to achieve competitive advantage and financial results, or vice versa.
Knowing how decisions impact bottom-line financial results is essential.
It is crucially important to have an appreciation of how decisions impact profitability, the utilisation of assets and cash flow.
As hinted earlier, it is now time for a new breed of local entrepreneur that has a deep insight into the marketplace in which a business participates.
This means knowing who customers are and what they want, who the competitors are and what they have to offer, and the trends shaping and redefining the marketplace.
It also requires an intimate understanding of the company’s competitive positioning, its value proposition to the customer and how leadership will support it.
All these are competencies that make up business acumen.
Zimbabwe is in dire need of foreign capital as the domestic stock of resources is not enough to sustain the economy.
A good work ethic naturally becomes a major prerequisite to attracting the same.
Foreign investors should not feel put off by the local business environment.
A conducive and enabling economic environment benefits both local and foreign investors.
Government is clearly working very hard to revive the economy and they surely need everyone’s support.
Dishonest behaviour by local partners is not good at all.
It is important for local businessmen to appreciate that professionalism accrues priceless dividends.
Taurai Changwa is a member of the Institute of Chartered Accountants of Zimbabwe and an Estate Administrator. He has vast experience on tax, accounting, audit and corporate governance issues. He is the director of Umar & Tach Advisory. He writes in his personal capacity and can be contacted at [email protected] or WhatsApp on 0772374784.
