Gavin started by giving a quick overview of Ilovo, which has operations in multiple African countries, primarily former British colonies. Illovo now brands itself as an ‘African Sugar Company’. The business is about significantly more than just producing sugar, but is rather a very complex agri-processing business. What was quite remarkable is that they produce enough electricity to supply their sugar mills.
Depending on the time of the year, the business employees between 12,000 – 17,000 people. Their challenges are how to engage their people and getting people to think about what they can do for the company, rather than what the company can do for them. They are currently experiencing challenges with people capability, particularly because of a loss of capacity at first-line manager level.
Their burning platform at this stage is that their ROTI is less than 10%, which is a lot lower than the other sugar operations that fall under the British Sugar umbrella. Past performance can largely be attributed to performance from individuals, or the ‘Hero Leader’ as he termed them. They have realised the need to shift these ‘heroes’ into a high-performance category, where they are much more focused on coaching and creating capability.
Traditionally, they operated with a very deep hierarchy, but found that this only worked well in South Africa. As they expanded into Africa, they have had to decentralise and devolve power, adopting a ‘think and respond locally’ mantra. Constant improvement (CI) requires a change in the leadership culture, something which he recognised they didn’t pay attention to early enough in the CI process.
Their CI process started in Zambia and was concerned primarily with a safety initiative. They gave the Zambian business the resources and targets, and then gave them the autonomy to implement as they like. There were two components in the strategy: a top-down approach, which gave out numeric objectives and a bottom-up approach, which worked on capturing the hearts and minds of the people. They found that they were totally unprepared for what happens when you do capture the hearts and minds of the people.
The lessons that they learned from their CI process were the following:
- They needed to get a reward structure in place earlier,
- You have to execute in culture-specific ways,
- You need to weave the CI process into all the business processes,
- They were too conservative in the group-rollout,
- Get rid of hero leaders earlier in the process. These leaders were operating a level too low.
With regards to Hero Leaders, they simply stopped recognising any aspect of hero leadership, but instead started interrogating why people had to act in a ‘heroic’ fashion e.g. ‘Why did you need to come onto the plant at 2am?’ They also defined the criteria for leadership in the organisation, which was boiled down to two primary criteria: ability to collaborate and to manage in an inclusive way. Essentially, both of these are focused on developing capability within the organisation.
I did sit through some of the other presentations that day, which included the Supply Chain Director from Indigo Brands, Ops Manager for ABI Pretoria and the GM for Consupaq. There was some very interesting stuff, but as always, it all seemed to come back to legitimate leadership. What was quite interesting though, was that the TRACC system gave people Means, Ability and helped instil a culture of Accountability by helping businesses lay out the strategy for achieving their vision and defining the contributions that needed to be made by each individual. Of course, I am sure that they only have success stories up there.
Quite an interesting component of the TRACC system is that they have a scoring mechanism that gives the business a sense of their organisational maturity. I had a brief opportunity to talk to the CCI Managing Director, Brett Muller. He admitted that the system worked well until they got to a med-high type scores, but that they really needed to do more work on the Leadership component.