ADDRESS TO TOURISM BBBEE CONFERENCE: Sandton International Convention Centre

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ADDRESS TO TOURISM BBBEE CONFERENCE
Sandton International Convention Centre

• Loyiso M. Mbabane
• 17 APRIL 2007

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HUMAN CAPITAL DEVELOPMENT BBBEE AND
TRANSFORMATION CHALLENGES FOR THE TOURISM SECTOR

• Loyiso M. Mbabane
• 17 APRIL 2007

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OPPORTUNITIES GALORE NEED AFRO-OPTIMISM
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Skills challenge or transformation challenge?

• THETA SECTOR SKILLS PLAN 2005-2009, pp. 31-32
• The tourist operators are the ones who decide
  the itinerary and do not seem to be able to tear
  themselves away from the run of the mill type
  of tourist spots and to target in their place
  authentic cultural spots. Competitiveness
  studies show that modern-day tourists expect to
  get, among other things, cultural tourism in
  their packages. Authentic cultural spots are
  what are demanded by the discerning tourist but
  the supply of these, by the tourist operators,
  falls short.

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• Human Capital Defined
• Term Human Capital first appeared in a 1961
  American Economic Review Article, Investment in
  Human Capital, by Nobel Prize winning Economist,
  Theodore W. Schultz.
• Later invoked (14 years later) by Economist Gary
  Becker (1975 1995) (e.g. National Bureau of
  Econ. Research).
• Generally comprises skills experience and
  knowledge
• Gary Becker includes personality, appearance,
  reputation credentials (World Bank Capital Dev.
  Working Paper).
• In Economics literature HC is broadly defined to
  include education, health, training, migration
  and other investments that enhance an
  individuals productivity
• HCD is not to be narrowly confined to HRD (or
  HR)
• References available from author upon written
  request (e.g. Rudolf, 2004 Gyimah-Brempong
  Wilson, 2004 Colombo Grilli, 2005 Samstad
  Pipkin, 2005, inter alia).

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• Significance of Human Capital Development
• Human Capital Development (HCD) is the single
  aspect of production that is critical toward
  ensuring equitable growth, for three reasons
• The skills attained are lifelong and can have
  positive effects across generations
• It is an endogenous growth factor providing
  opportunities for local growth strategies in
  virtually any geographic setting
• Investment in HCD can be targeted directly to
  benefit the poor, potentially allowing for more
  equitable growth
• Samstad, J.G., Pipkin, S. (2005). World
  Development, Vol. 33, No. 5, pp. 805-822

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• South African neglect of HCD
• State of Skills in South Africa Report by
  Department of Labour (South Africa) (2005)
• Dramatic decline in both apprenticeship and
  enterprise-based training in South Africa during
  the late 1980s and 1990s
• Decline provided a very low base off which to
  build and reflected a historically-evolved
  enterprise culture that remained unconvinced of
  the merits of widespread training
• Now short of boiler-makers welders and moulders!
• Scarce Skills for 2004-2009, nationally
  Project managers Financial Managers Sales and
  marketing managers General Managers Business
  Leadership Entrepreneurs (across all sectors)
• Department of Labour (2005 56)

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THETA SKILLS CHALLENGES

• -THETA SECTOR SKILLS PLAN 2005-2009, pp.
  31-32-
• So, besides the skills problem, there is a
  hidden transformation problem. There might be a
  skills gap where tourist guides do not speak the
  more popular international languages and there
  would be an opening for communication and
  languages training in say Italian, French,
  Portuguese, German and Arabic.. (our emphasis)

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• Skills problems in sector a reality or just
  red herrings (real challenges or excuses)
• What skills are alleged to be lacking in sector
• Chefs cooks (specialized skills) (and black
  people pot-shy?
• IT time-management Administrative
  Customer-handling communication languages (are
  these specialized or generic, Life and
  exposure issues?
• Technical skills relating to pay-out machines
  in casinos and Software and actuarial science
  behind gambling. How many jobs are we talking
  about and to what extent are these real reasons
  for lack of equity?
• Gambling is quite new and there has been little
  time to realistically and sufficiently develop
  the skills base among blacks Where did the time
  come from for other race groups? All are new to
  gambling in South Africa?
• Blacks are grooms in horse racing and there is no
  upward progression to trainers or jockeys. Why?

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• Answer lies in where we are putting our money
  (not where the mouth is)
• Who are we investing in (WSP, Table 8, p. 25)
• About 11 000 white senior managers, receiving
  35 of training budgets, versus 7000 black senior
  managers 8 (4x less)
• Some 2000 white professionals 6 of training
  budgets 1000 blacks 1
• More black technicians than white (6979 v 6428)
  yet 8 of training for blacks v 21
• Ditto for Clerical workers, 10 813 blacks,
  getting 12 of training budget, versus 4, 339
  whites (two times fewer) 14 of training
• Not to mention the quality of the training!!!

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• Transformational leadership and organisational
  transformation are the major challenge
• CEOs of major hotels car rentals, etc where
  does equity and empowerment feature in their
  KPAs?
• Do we have more Fidentias w.r.t. to BBBEE
  approach?
• How many CEOs in tourism industry are even doing
  the BBBEE talk, let alone walking it?
• Are there any company-endorsed BBBEE Strategies
  that are genuinely addressing the countrys
  discriminatory past and current effects thereof?
  How serious are these?
• Seem to be stuck at the 1980s issues about time
  management etiquette lack of skills
  low-level black employees and other
  stereotype-based excuses that blame the poor
  and uneducated for their plight (shares same
  approach/ excuses as farming and domestic
  sector!)
• Very little responsibility taken by
  owner-managers (if you are small you cant do it
  if you are big you are not doing it)
• A lot of government blame and external locus of
  control
• Government must provide incentives, but dont
  regulate!

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Enkosi Lealeboga Asante Sana Thank
You Contact Tracy Patterson Economic Justice
Agency 043 742 0286 tracy_at_eja.co.za