Could CSI South Africa Be Potentially Crippling Its Own Industry’s Small Business Community?

As we reassemble after Covid-19, the looting of KZN and the floods, one would think, just think that things would have changed or even shifted in the way we do business. Right? In this case – wrong. I have just gotten the biggest wakeup call ever. To think that thousands of lives were lost, not to mention the businesses and the livelihoods that were barely getting off the ground, beginning to dust themselves off and say “We began here and got through the pandemic” … then were hit by the devastating looting and the recent floods.

And now we must deal with another old but persistent pandemic. Late payments that are crippling small businesses in the CSI sector. Imagine my surprise when I was approached by small businesses who are struggling to get payments from big business. They say that when it’s time for them to be paid, they are sent from pillar to post. Well, we took up the cudgel and said we would write about it. Here it is! Now, I have to say there are some corporate businesses that have their ducks in a row. I am not one to talk much and we generally don’t praise people around here, but I must take my hat off to Santam and Old Mutual, Momentum and the Road Accident Fund – companies that truly act out their values.

Two years ago, I worked with the head of short term insurer in another organisation and their understanding of the process of small business quick payment was uncanny. This same head moved to another organisations and the process was just as unprecedented. I worked with Old Mutual for over two years and can attest that they truly pay within seven days. This is definitely not the case with many other companies. As you emerge from a pandemic, trying to pick yourself up, you find yourself being put into debt by a client’s agency because they say they are putting you through their processes. I mean, what more can I say?

Let me offer an example: a small company did a job for their client, and the client told them that they have to go through an agency. They submitted everything and began the process in May. But by the time payment was supposed to come through, people were on leave (week one), finance was on leave (week two), the person they were dealing with was on leave (week three) and then the person that authorising payments was on leave. Four months later, this young business, passionate about its work, is still struggling to get a date for when they will be paid.

They have been told that their payment was delayed because the client had to pay another person to pay them! What I am trying to say, is that this is 2022, when we’ve had a pandemic, looting and floods. To my mind, when small businesses are so vulnerable, there should be systems in place to ensure that this should not happen.

I think some of us in CSI South Africa should learn from champions in the game: for example, the process at Old Mutual, Investec and Momentum is simple – you go to the client and the client registers you as a vendor. They commission the work, tell you when you will be paid and like clockwork, the payment is done.

Now the questions are: Why do CSI departments have communication and marketing agencies who take 45 days after the work has been done to pay CSI small businesses? While waiting to be paid, these small businesses have to keep their projects running, fuel their vehicles, take their staff to work and feed their children … and so the good deeds that small businesses in CSI development continue to accomplish while waiting endlessly to be paid go on …

What on earth do these agencies know about CSI work, anyway? I have always asked this question and continue to ask it.

Someone once said to one of my top clients, “If it does not bleed, it does not lead”. She mistakenly thought she was impressing the client, but the client discovered that this agency director was simply talking about fabricating public relations stories that would compel people to read more about the client brand, without referring to the real Corporate Social Responsibility work the client was involved in. It did not go down well. Needless to say, the client hired us and within a year, the client was winning awards from the work we had put in to make their work noticeably stand out. Stand out it did.

I ask CSI South Africa –
Why do you need marketing and communication agencies who are not steeped in the knowledge of CSI to tell your impact stories? How on earth does a person writing a story about, for instance car tyres, dog food or even promoting of baby diapers, know about Corporate Social Responsibility / investment impact issues? Come on, I don’t think we need to go to Mars to figure this one out. Better still, I don’t even think we need brain surgery for this one.

When did they actually meet with communities, learn about their needs and understand the different dynamics that prevail within the industry? I propose that we all need to wake up now and change the way that CSI business is conducted: the pandemic is over and even for those of us who are not aware, lockdown is over too and many masks are as good as manure by now.

These are the ways in which you can make CSI work for you:
Get up out of your slumber and look at your processes. CSI South Africa, I think we need to think carefully about how we tell our stories. No wonder some of us still remain unnoticed. “Why is that?” you ask. Let me share with you why this is the case: It is because the person writing your impact story studied Marketing and Communication 101.

Case in point: We were recently, looking for an intern to join our team to work in the Communication and Marketing department. What I learnt from just two minutes of the phone call was shocking.

I asked the recently-graduated young fellow about certain systems about which he knew nothing. And I mean nothing. The systems I questioned him about were MailChimp, digital newsletters and webinars. I was shocked at his lack of real knowledge about current communication systems. However, this young fellow has a degree in Marketing and Strategic Communication, for which he paid around R100 000 for the course per year. I mean. I raise my hands up in the air in disbelief, because if this graduate knows nothing about Mailchimp, when will he learn about CSI?

What we should consider is CSI 101 or even CSR 101
What is CSI 101? It is being on the ground. It is travelling the length and breadth of communities in this country and really trying to tell the story – not from your angle and not from the community’s aspect either, but from the surroundings around the communities you impact. It is my opinion that real impact cannot be measured by the person you change, but by what the person upon which the impact has been made, does with that (so called) impact.

Everywhere I go, I hear the same story – “We want it to be about them.” I’d like to ask, “Who are them?” I sometimes sit in meetings and cringe as I hear such statements, because in my view, we are them; we are the communities we work for and in. In December, we go back to the very communities we say we have impacted upon because that is where our grandparent or our parents still live and yet Mamkhize is still In her Spaza, yet maNdlovu is still sitting in her corner selling tomatoes, apples, oranges and peanuts (the government uses the term survivalists for people such as these). We even buy the peanuts from them for ZAR10 although they are only worth ZAR5. In these communities there is always a person like Babu Sekhosana who is still a drunkard.

That right there is a clear sign that we have done nothing for our communities. If those people’s lives have not changed, you have not done anything of impact, or at least, not enough.

There is a lot to be done by all of us, looking at internal and external processes. The first questions to ask ourselves should be: Where we need to fix first? A powerful woman I recently interviewed simply said: “What is broken?” This refers to my grievance earlier – a small business does a job for a big company, completes the job and is told to go to the agency that will pay them – WHY?

The agency puts that small business through a 45 day waiting plan because they say these are their procedures . How on earth are small businesses supposed to survive when the very mandates of government are actually broken by the processes that the giants have in place?

You cannot say that you are working in line with government objectives when your systems are crippling the objectives that government has set.

You cannot say that you are building our society and yet killing the small businesses that are employing young people, providing food for their families, paying for school fees, and being bread winners for their families after a pandemic and you blame the late payment on your processes.

You cannot make a small business wait 45 days, I am sorry!!!

This is simply ridiculous!!!

In closing: Let me just put into perspective what late payment can do to a small business.

  • Their supply chain breaks – as those who supply services to them are paid late and therefore would rather not work with them in the future.
  • Their staff members begin to lose confidence that they will be paid on time or even at all.
  • The end of August is provisional tax month when SARS wants their monies. So, a small business that has not been paid, fails to pay both provisional tax and VAT and incurs serious penalties (added costs).
  • SARS refuses to give them a tax clearance certificate – therefore they lose other potential clients because their registration processes with other clients fails to meet all obligations.
  • The worst of all – the morale of the leader and the team are destroyed( I can attest to this). They are unable to work because of the pressure that non-payment does (the very people you hired because you believe in their work). Essentially, they are broken through YOUR inadequate processes.

And that is what is broken.

Corporate Social Responsibility News (CSRNEWS) is South Africa’s leading Corporate Social Responsibility news, media and publishing firm. We create content on social responsibility, helping government, corporates, consultants, NPOs and NGOs to reach their target markets through appropriate, targeted development news.

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