[INTERVIEW] Interview with Richard Nash, Consulting Manager, Frost & Sullivan, South Africa
Africa Business Communities is pleased to present an interview with Richard Nash, Consulting Manager at Frost & Sullivan, Cape Town, South Africa.
Please introduce yourself - your company and your position.
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants. For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Frost & Sullivan assists companies to prepare for the next profound wave of industry convergence, disruptive technologies, changing customer dynamics, increasing competitive intensity and Mega Trends through providing in-depth market intelligence, strategic insights and partnering with companies throughout the process of growth, from innovative idea to implementation of visionary strategies.
Richard Lee Nash is a project manager in the Growth Implementation Solutions division, where he, and his team, partner with companies throughout the growth process, helping to develop strategies, design processes, optimise operations and implement the growth solutions.
In what countries do you operate?
Frost & Sullivan has offices in over 40 countries worldwide. The African office is located in Cape Town, South Africa, providing localized solutions to organisations across Africa.
Who do you service as a company - the public, private or government sector?
As a growth partner, Frost & Sullivan provides a wide variety of services to the government, public and private sectors including:
- Off the shelf and customised market intelligence reports
- Strategy Development & Planning
- Organisational Operating Model Development
- Mergers & Acquisitions
- Benchmarking & Operational Excellence
- Turnaround & Operational Effectiveness
Our industry expertise covers a wide array of sectors including:
- Environmental and building technologies
- Chemicals, materials and food
- Energy and power services
- Industrial automation and process controls
- Healthcare
- Metals and Minerals
- Information and communication technologies
- Government and public sector
What are the major challenges to operating in the African market today?
There are quite a number, actually. To highlight a few:
The great unknown
In today’s rapidly changing world, knowledge is critical to success and survival. For businesses in Africa, this certainly holds true. One of the greatest challenges in Africa is the uncertainty that encompasses the daily operations of multinational organisations. While Africa provides lucrative opportunities, there are multiple unknowns resulting from issues such as political instability, changing legislation, poor availability of economic data and insufficient market intelligence. These uncertainties often prevent businesses from fully leveraging the opportunities that Africa provides.
Africa’s heterogeneous markets
Africa has a collection of truly heterogeneous markets, where even neighbouring countries can differ vastly in terms of people, preferences, market structures, economic prosperity, regulation and legislation. Given this, it is imperative that businesses understand the intricacies of each of these potential markets to promote successful expansion while ensuring the continued success of their current operations.
Different countries often require customised product portfolios, distribution and operating models to ensure that they are suited to the local operating environments. This adds complexity to the business structures and management, making it difficult to integrate local operations into global organisations without compromising on performance and growth.
Finding the right people and partners
As Africa continues to grow the demand for skilled employees and reliable service partners is growing too.
The high demand, and relatively small pool of suitably skilled and experienced people to draw on, has led to competitive skilled labour markets, which hampers not only growth, but the ability to keep current operations running smoothly.
As companies expand into new territories it is important to find the right partners and service providers to assist with the rapid establishment of operations. Finding these partners and suppliers can be an arduous task, and can often delay the pace of expansion with many companies resorting to setting up the full value chain themselves. This increases risk and complexity, while significantly increasing the investment required.
Providing the right products the right way
Africa has a very different environment to other continents, such as Europe and North America, and customers often require unique product offerings. This has forced companies to be more innovative in both business models as well as their product design. The highly dispersed population has resulted in companies having to develop new distribution models, while income levels require companies to sell the products at significantly lower prices, ensuring customer affordability. These new models and products require a deep understanding of the local business environments.
As a player in this market, can you proffer a possible solution to these challenges?
Providing the knowledge when it’s needed! Market intelligence and experience in the local environments is essential as a starting point for moving into new markets. It is imperative that companies gain a firm understanding of the new markets to operate in, as this minimises the risk by ensuring that the correct markets are prioritised and that the most appropriate entry strategy is utilised.
For companies already operating in African markets, it is important to be aware of developments in the market and the activities of competitors. Being clear on the size of the market allows them to assess growth and revenue in the context of the available potential to set targets and keep focus on rapid and sustainable growth.
Sourcing and assessing strategic partners
Moving into new markets can be very risky. For those testing new markets it often makes sense to partner up, or purchase existing companies, to speed up the entry, while leveraging their existing infrastructure, resources and knowledge to ensure success. Unfortunately, in practice, it is often difficult to source and assess these partners. Frost & Sullivan can leverage their in depth knowledge of market players to assist in the identification and the selection of the most suitable partners or acquisition targets.
Walking the journey
As true growth partners, Frost & Sullivan do more than just assist organisations with developing their growth strategies, but walk the full journey with their clients until projects have been implemented and integrated into current operations. This affords clients the opportunity to draw on Frost & Sullivan’s extensive market intelligence, but also the value generated from having operated on the ground and having implemented a wide variety of projects on the continent.
What remarkable advancement has your company made in recent years that you find most outstanding?
As a company Frost & Sullivan recognised the need to set up operations in Africa. This has allowed Frost & Sullivan to gain the necessary African experience, resulting in richer insights and localised solutions which enable clients to truly benefit from the partnerships as they leverage our market insights and hands on experience.
In addition to this, we often work on-site with our client, allowing a deeper understanding of the challenges faced; bringing forth the development of fully tailored solutions to ensure maximum value is gained for the relationship.
What change(s) would you like to see in your industry that would make your job easier?
As growth partners, we have many clients expanding in to Africa. Some key changes that would support these expansions easier would be:
- Bold and decisive leaders who are willing to serve the people and guide Africa to inclusive prosperity
- Reduced corruption and increased levels of transparency
- Standardisation of product regulations and financial reporting
- Improved agreements for cross border trade
Overall, how would you say the African market performed in 2012?
2012 was a very good year for Africa, with very strong economic growth, significantly outpacing most developed economies. There has been a strong move towards increased democracy, regional integration (especially through new infrastructure developments) and increased foreign direct investment positioning Africa for further growth in 2013. This broad-based progress is underscored by a substantial shift in mind-set and activities among Africans themselves, with increased self-confidence and continued strong growth in intra-African investments. The combination of these factors is promoting the correct environment for African companies to expand their operations and continue to drive sustainable growth across the continent in the coming years.
Any predictions for the market, and particularly in your industry, for the rest of 2013? Would you, if you had the choice, invest more carefully or more boldly?
While the effects of the global financial crisis were certainly felt by many African economies, Africa has rapidly regained its strength. Over the past decade, Africa has experienced the fastest economic growth the continent has ever seen. Countries such as Nigeria, Ethiopia, Mozambique, and Guinea are among the fastest growing economies in the world. This, combined with the large and growing population, creates a strong basis for further investment and expansion into African markets.
The lack of competition and growing demand creates many opportunities, however, as with any investment; these opportunities need to be carefully assessed to ensure maximum value is generated from investments. Foreign companies moving into Africa need to take the time to understand the environment and the opportunity it presents. For many companies this will mean adjusting strategies, products and business models to avoid costly mistakes.
With the correct approach, bold investment strategies in 2013 could see companies earning themselves significant profits in the short term, while entrenching themselves in the market early on to take advantage of the significant growth forecasted for the coming decades.
What is the latest from your company? Anything we should look forward to?
As a true growth partnership company we recognise the potential of further expansion into African markets. We provide a stronger focus on international expansions, leveraging our knowledge and experience to assist our client throughout the full process of opportunity identification and prioritisation, as well as actual on the ground implementation of new operations.
