Africa may be in growth mode, but it is by no means certain that growth alone is going to transform the continent into a place where people aspire to live and work.
While the African economy has grown at an average of 5% a year over the last few years and growth is predicted to reach 7% by 2016, according to the World Bank, a recent report by the Africa Progress Panel (APP) reports that over 48% of people living in sub-Saharan Africa still live below the poverty line. Economic prosperity has not made a measurable impact on the lives of the 413 million Africans surviving on $1.25 per day.
The continent urgently needs to find ways for more people to benefit from the fruits of economic growth – not just stakeholders and international investors, but ordinary people – and one of the obvious vehicles through which to achieve this is business. But not just any business, it must be inclusive business.
Inclusivity is not a new concept in business, but is emerging as a key theme of current economic thinking, particularly in terms of the way forward for the African continent. It argues for the inclusion of lowincome communities in the value chain – both as producers and consumers – not at the cost of profitability, but for the gain of society and the environment. It is a call for business where ethics and values play a bigger role in day-to-day operations.
African business schools have the power to effect this shift. They have the knowledge and expertise needed to put new theories on how to do business more inclusively into practice, and of course to train the next generation of graduates to understand and enact these new ways of doing business. Business schools have the opportunity, not only to shape and polish the intellectual resources of the continent by preparing future business leaders, public works officials and budding entrepreneurs to be truly successful in business, but also to create leaders who are committed to sustainable enterprises that are inclusive and help to improve the lives of others.
In experimenting with ways to increase their impact, African business schools have perhaps more opportunity than most. The sheer scale of the challenges on their doorsteps invites academics and students alike to role up their sleeves and get to work experimenting with how business and the power of business thinking can be used to change people’s lives for the better.
It is no longer enough to put people in classrooms and tell them what they need to know – or bombard them with case studies, as is the triedand-tested method of many of the best business schools around the world. African business schools have the opportunity to spearhead emerging economy business thinking, from close proximity to emerging economy issues and to redefine business models that don’t work so well in emerging markets to create ones that focus on developing the base of the pyramid and creating shared value. They can push the agenda on social innovation and the role this can play in business. In essence, they can break the mould in traditional education in order for more holistic responses to the challenges the continent faces to emerge.
At the UCT Graduate School of Business, this imperative has spawned numerous initiatives including the Solution Space, which has been called a living manifestation of the business school of the future. Programmes and initiatives like the MPhil in Inclusive Innovation and the Social Innovation Lab, a stream on the MBA that allows students to essentially immerse themselves in the imperatives of social innovation, were started because the UCT GSB realised that the continent needs people in the trenches who have the training and mindset to implement real-world change by applying practical innovations.
Changing the continent one business at a time
If the African business school of the future is to look something like the UCT GSB: creative, interactive, challenging and entrepreneurial; then how is this going to change the continent?
One such outcome is quite simply the impact on development of local business; changing the continent one business at a time. For example, the UCT GSB, through the Bertha Centre for Social Innovation and Entrepreneurship and the Solution Space, is working in partnership with one of Cape Town’s poorest areas – Philippi – to boost business development in the area. Philippi is one of the larger townships situated outside of Cape Town. It is part of the Cape Flats with a population of around 700,000 people. Philippi, like many other townships, is an under-developed and under-serviced area with high unemployment rates.
Philippi Village is a new development that aims to shift that by creating a space in the centre of Philippi that will nurture entrepreneurs, support skills development and harness job creation. The development aims to invigorate this area with job opportunities and recreational activities.
Philippi Village will be an entrepreneurial development with a social impact. It will be a multi-use, multifaceted environment that will house local businesses and entrepreneurs, an event and entertainment centre, sports and conferencing facilities, and an education space.
These efforts are increasingly being given global recognition. In 2012, the Social Innovation Lab at the UCT GSB was included as a case study in the Inspirational Guide for the Implementation of Principles for Responsible Management Education, an initiative of the United Nations Global Compact, which highlights 64 schools around the world leading the way in this regard. The UCT GSB’s neighbour – the University of Stellenbosch Business School, was also featured in the guide, for its sustainability research in an African context.
By being more in tune with their context and its challenges, students emerging from these schools (and others that follow their lead) are more likely to take what they have learned and apply it to creating a sustainable business that addresses people’s actual needs.
Complex problems need fresh thinking
Research is showing that interest in socially innovative business is growing – not only from an investment point of view, but also at the coal face – as a result of student demand. Data from The Bridgespan Group shows that across some of the top MBA programmes, there has been soaring interest in social enterprise in recent years, and schools have grown their offerings with socially beneficial content to meet the demand. Between 2003 and 2009, the average increase of this content in the schools polled was 110%. The Yale School of Management showed the highest increase in 2009, with 95% of their course offerings now incorporating social benefit content.
A 2012 study from the Association of MBAs (AMBA) shows that one in five MBA graduates now believes that sustainable or responsible management is the most important MBA topic. The research was conducted among 1 000 graduates from AMBA-accredited business schools in 75 countries and heralds an important shift in the way students and business schools alike are thinking about the MBA.
The UCT GSB, itself an AMBA-accredited school, has seen this trend reflected in its own student body. More than 60% of the MBA students polled at the school in 2013 said that they chose to study at the UCT GSB because of the business school’s work in social innovation and sustainable business management.
So while many investors are eyeing Africa as a high-growth option in troubled times, the opportunities for social innovators are far greater. Social innovation has great potential for investors because of the great demand for it across emerging markets, and because it improves the overall environment in which to do further business in the future. Improved health, education, infrastructure and job creation all lead to better business.
The gold is not in traditional business approaches. It is not about selling more stuff to people that they don’t need and cannot afford. It is in the more elusive approach of creating shared value and innovating in a way that improves the lives of the consumers. Underlying this notion is the idea that if you deal with the need, the demand will emerge and the consumer will support you – basic business sense.
Combine this with cultivating a mindset for innovation and this is how we help to prepare the future leaders on the African continent to be successful – not only in terms of profitable companies – but also in achieving more sustainable, inclusive and socially innovative business solutions that truly add value to the lives of stakeholders and shareholders.
In this way, the economic boom on the continent can be successfully translated into social and environmental capital on the ground – helping to transform Africa into a place where people choose to work and live.