advanced strategic management : thebe investment corporation

LUNGILE ROSEMARY KHUMALO - 20926250

OVERVIEW1.1 THEBE INTRODUCTION

1.3 CHANGES IN THE MACRO-ENVIRONMENT

1.6 SWOT ANALYSIS

2.4 DISTINCTIVE COMPETENCIES

3.1 PRACTICES UTILISED YEILDING SUPERIOR EFFICIENCY, QUALITY,

INNOVATION AND CUSTOMER RESPONSIVENESS

3.2 PRACTICES THAT RETARD SUPERIOR EFFICIENCY, QUALITY,

INNOVATION AND CUSTOMER RESPONSIVENESS

4.1 INDUSTRY ENVIRONMENT

5.6 TWO DISTINCTIVE COMPETENCIES AND POTENTIAL INDUSTRY12 May 2015 THEBE INVESTMENT CORPORATION 2

ABOUT THEBE?12 May 2015 THEBE INVESTMENT CORPORATION 3

INTRODUCTION

12 May 2015 THEBE INVESTMENT CORPORATION 4

SOLE SHAREHOLDERBATHO BATHO TRUST

ORIGINAL TRUSTEES NELSON MANDELA

(CHAIRMAN) WALTER SISULU REV. BEYERS NAUDE SIDDIK AHMED

NON-EXECUTIVE CHAIRMANENOS MABUZA

CEOVUSI KHANYILE

THOMAS NKOSIWALTER SISULUSUPPORTED BY

SHARED VISION

MAKE ECONOMIC SELF-SUFFICIENCY A REALITY FOR MAJORITY OF SOUTH AFRICANS

JULY 1992

R100 000 00

BOARD OF DIRECTORS

EXECUTIVE DIRECTORS


Mr Vusi Khanyile Ms Refiloe Nkadimeng

NON-EXECUTIVE DIRECTORS

Mr Godfrey Gomwe Ms Gllian Nonhlanhla Jiyane Dr May Mkhize Ms Peta Mashinini Ms Rene Schutte

Rev Dr Molefe Tsele Dr Nomonde Mabuya Mr Dirk Ackerman Mr Alton Solomons Mr James Alderslade

Dr Yvonne Muthien Anthony Umson Andiswa Jekwa

12 May 2015 6

GROUP COMPANY SECRETARY

THEBE INVESTMENT CORPORATION

MANAGEMENT COMMITTEE

Mr Vusi Khanyile Ms Refiloe Nkadimeng Mr Jacques de Wet Ms Nonhlanhla Mabusela

Dr Pieter Kriel Mr Rapulane Mogototoane Mr Jerry Mabena Ms Zukie Siyotula



FOU

ND

ED IN

19

92

PIONEERING BLACK-OWNED COMPANY

DEV

ELO

PM

ENT

AN

D

INV

ESTI

NG

PROMOTES MUTUALLY BENEFICIAL PARTNERSHIPS

CR

EATI

NG

VA

LUE

FOR

ST

AK

EHO

LDER

S

ORIGINATION

EXECUTION

ACTIVE PARTNERSHIPS

INVESTMENT MANAGEMENT

Over 20 years Thebe has become South Africa’s most reputable, diversified investment management companies

through sustainable development, market transformation and empowerment.


SANLAM PRIVATE EQUITY

9.8%

ABSA CAPITAL LIMITED

22.5%

BATHO BATHO TRUST

47.5%

UMHLOMULO EQUITY

PARTICIPATION

20.2%

THEBE SHAREHOLDING

THEBE DIVISIONS12 May 2015 THEBE INVESTMENT CORPORATION 10

THEBE SERVICES

THEBE POWER AND INFRASTRUCTURE

ASSOCIATES• SAFRIPOL• COMBINED MOTOR

HOLDINGS• ALTECH NETSTAR

GROUP• SHELL MARKETING

AND SHELL REFINING

• VODACOM SA

ASSOCIATES• THEBE REED EXHIBITIONS• COMPASS GROUP SA• CAPE POINT• SPARKS AND ELLIS• TOUR d’AFRIQUE• FIRST CAR ENTAL• JARDINO LLOYD

THOMPSON• EFFICIENT FINANCIAL

HOLDINGS• NASOU VIA AFRICA• KAYA FM

SUBSIDIARIESTHEBE UNICO, THEBE CONNECT, THEBE

TOURISM GROUP, THEBE STOCKBROKING, THEBE YA BOPHELO HEALTHCARE, THEBE

PROPERTY ASSET ANAGEMENT, THEBE ENERGY AND CLUB TRAVEL

SUBSIDIARIES• REATILE TIMRITE

ASSOCIATES• SENTULA

CONSTRUCTION MINING

SUBSIDIARIES• THEBE RENEWABLE ENERGY HOLDINGS

ASSOCIATES• MAINSTREAM

RENEWABLE POWER• PHINDADA HOUSING• ACCENTUATE LIMITED• HEADSTREAM WATER

SA

THEBE CORE BUSINESS

› Unique entrepreneurial company

› Profits + broader interests of the community

› Thebe investment portfolio spans tourism, mining resources, infrastructure, renewable energy, petrochemicals, telecommunications, financial services and healthcare


VISION

Thebe is an African investment management company that makes sustainable investments for the benefit of the

community and other stakeholders.


MISSION STATEMENT

“We strive to be a community-rooted company that actively manages and governs our investments to optimize stakeholder

value”.



THEBE VALUES

EQUALITY

INNOVATION

INTERGRITY

QUALITY

COMMUNITY

OBSERVATION -ALIGNMENTS


Adheres to the TRIPLE BOTTOM LINE

Adopted the King III Report on Corporate Governance

Collaborative Partnerships with investee companies

Active Engagement of all Managers

Effectively Communicated

Substantial growth - direction and focus

Defines the business

Identified the product

Purpose

Addressed the needs of stakeholders

Philosophy of the organisation12 May 2015 THEBE INVESTMENT CORPORATION 16

1.3

CHANGES IN THE

MACRO-

ENVIRONMENT


THEBE INVESTMENT

CORPORATION

POLITICAL

ECONOMIC

SOCIAL

TECHNOLOGY

ECONOMIC

LEGAL


1.TECHNOLOGICAL CHANGES


POSITIVE IMPACTSDISCOVERIES

INCREASED PRODUCTIVITY

E-COMMERCE

CRM – CONSUMER RELATIONSHIP MANAGEMENT

EFFECIENCY IN DISTRIBUTION

SCOPE FOR INTERGRATED MARKETING COMMUNICATION

OPPORTUNITY TO CHANGE BUSINESS MODELS

INNOVATION


NEGATIVE IMPACTS

DEPENDENCY

SYSTEM COMPLEXITY

DISLOCATION OF WORKERS

LESS VALUE IN HUMAN WORKERS


DE

VE

LO

PIN

G O

R

AC

QU

IRIN

G

TE

CH

NO

LO

GY

IN-HOUSE DEVELOPMENT

ALLIANCES

ACQUISITION



TECHNOLOGY AND PORTERS FIVE FORCES

BARRIERS TO ENTRY May reduce economies of scale – encouraging new entrants

Barriers may also rise – products becoming more complex and processes difficult to copy

SUBSTITUTES New products displacing the old Technology in other Markets may steal

customers from other markets

POWER OF BUYERS AND SUPPLIERS

Technology may free businesses from a single source of supply

INDUSTRY RIVALRY Rivalry is diminished if successfully patented and licenced

2. ECONOMIC INSTABILITY


POSITIVE IMPACTSSTABLE EMPLOYMENT

DISPOSABLE INCOME

ECONOMIC INFLATION – MORE INVESTMENT AND EXPANSION OPPORTUNITIES

FOREIGN EXCHANGE RATES

STABLE ECONOMY = STABLE PROFITS


NEGATIVE IMPACTSGLOBAL INEQUALITY

ECONOMIC RECESSION

LOWER EXPANSION OPPORTUNITIES

LOWER INVESTMENT OPPORTUNITIES

STAGNANT GROWTH


1.6 SWOT ANALYSIS



THEBE INVESTMENT CORPORATION

STRENGTHS1. STRONG BRAND2. PRO-ACTIVE COMMUNITY SUPPORT

AND ENGAGEMENT3. MATURE INDUSTRY AND MARKET4. WOMEN EMPOWERMENT5. ADHERENCE TO BEE STANDARDS

WEAKNESSES1. ENVIRONMENTAL IMPACTS2. HIGH PRICES3. STRICT INVESTMENT SELECTION

CRITERIA

OPPORTUNITIES1. NEW TECHNOLOGIES2. GOVERNEMENT SUPPORT3. MORE FUTURE AFFILIATIONS4. IMPROVING ECONOMIC IMPACTS ON

LOCAL COMMUNITIES5. TRAINING AND SERVICES

OPPORTUNITY – STRENGTH STRATEGIES

1. DEVELOPMENT OF NEW TECHNOLOGIES

2. CONTINOUS EMPOWERMENT

OPPURTUNITY – WEAKNESS STRATEGIES

1. ADOPT ENVIRONMENTALIMPACTS ASSESSMENT

2. COMPETITIVE PRICING STRATEGY

THREATS1. ECONOMIC CHANGES2. NATURAL DISASTERS3. COMPETITION4. ENVIRONMENTAL AND ECONOMIC

REGULATIONS5. POLITICAL CHANGES

THREAT – STRENGTH STRATEGIES

1. BRAND MANAGEMENT 2. ACTIVE REGULATIONS

ADHERENCE

THREAT – WEAKNESSSTRATEGIES

1. DEVELOP NEW SELECTION CRITERIA

2. FOLLOWING ALL ENVIRONMENTAL REGULATIONS

12 May 2015 29

2.4 DISTINCTIVE

COMPETENCIES


HIGH SKILLED EMPLOYEES

PRODUCTS AND SERVICE DESIGN

COMMITMENT TO CORPORATE GOVERNANCE

MUTUAL VALUE

DIVERSIFIED INVESTMENT BASE

EXCELLENT RISK MANAGEMENT SYSTEM


COMMITMENT TO EMPLOYMENT EQUALITY

FLAT MANAGEMENT STRUCTURE

PROMOTION OF SOCIAL CHANGE

THEBE FOUNDATION

ABILITY TO SOURCE FUNDING BOTH LOCALLY AND INTERNATIONALLY

SUPPORTING MAJORITY COMMUNITY BASED SHAREHOLDER


3.1 PRACTICES UTILISED YEILDING SUPERIOR

EFFICIENCY, QUALITY, INNOVATION AND

CUSTOMER RESPONSIVENESS


ACHIEVING SUPERIOR EFFICIENCY

FLEXIBILITY AND CUSTOMIZED SUBSIDIARIES

MARKETING ACTIVITIES

HUMAN RESOURCE STRATEGY

INFORMATION SYSTEMS

CLEAR GOALS

LONG-TERM RELATIONSHIPS WITH SUPPLIERS


ACHIEVING SUPERIOR QUALITY

SUPERIOR PERFORMANCE AND SERVICE IN ALL ASPECTS OF BUSINESS

PROVIDING SUPPORT TO SUBSIDIARIES

FULFILLING RESPONSIBILITIES TO STAKEHOLDERS

FLAT ORGANISATIONAL STRUCTURE


ACHIEVING SUPERIOR INNOVATION

CROSS FUNCTIONAL INTEGRATION

EXPERIENCE

CUTTING EDGE TECHNOLOGY

SUPERIOR COMMERCIALISATION


CUSTOMER RESPONSIVENESS

› ACCEPTING OUR CORPORATE RESPONSIBILITIES TO THE NATION

› EMPHASIZING ENVIRONMENTAL FACTORS, SAFETY AND PROTECTION

› DEVELOPING A NEW VOICE FOR CORPORATE SOUTH AFRICA

› SHAPING EMPLOYEE ATTITUDES

› LEADERSHIP


3.2 PRACTICES THAT

RETARD SUPERIOR EFFICIENCY, QUALITY,

INNOVATION AND CUSTOMER

RESPONSIVENESS12 May 2015 THEBE INVESTMENT CORPORATION 38

ACHIEVING SUPERIOR EFFECIENCY

Inadequate training programs for employees

ACHIEVING SUPERIOR QUALITY

Total Quality Management (TQM) insufficient

ACHIEVING SUPERIOR INNOVATION

UncertaintyPoor positioning strategy

ACHIEVING SUPERIOR CUSTOMER RESPONSIVENESS

Highly politicized – Black Capitalists


4.1 INDUSTRY

ENVIRONMENT


INDUSTRY ENVIRONMENT LIFE CYCLE


Maturity

MATURE INDUSTRYLOW RISKS

POWER OF SUPPLIERS DECLINES

POWER OF BUYERS INCREASES – CAPACITY MATCHES / EXCEEDS DEMAND

THREATS OF SUBSTITUTES IS GROWING

RISE OF INTERNATIONAL COMPETITION

GREATER TECHNOLOGICAL MATURITY


EVOLUTION OF MATURE INDUSTRIES


STRATEGIES FOR THE MATURE

INDUSTRY


QUALITATIVE DIFFERENTIATION

DEVELOPMENT OF UNIQUE PRODUCTS

› Brand Image

› Design

› Superior Technology

› Diversified distribution channels


STRATEGIES FOR DETERRING

ENTRY OF RIVALS

PRODUCT PROLIFERATION

PRICE CUTTINGMAINTAINING

ACCESS CAPACITY


Filling the Niches:

making it difficult for new

competitors to break into a

new industry

Sending a Signal:

to potential new entrants

contemplating entry that new

entry will be met with price

cuts

Warning of Retaliation:

by increasing output and

forcing down prices until

market entry would be

unprofitable to entrants

STRATEGIES FOR MANAGING INDUSTRY

RIVALRY

PRICE SIGNALLING

PRICE LEADERSHIP

CAPACITY CONTROL

NONPRICE COMPETITION


Convey intentions:

Intent is to improve industry

profitability.

Informal pricing:

Formal price setting jointly by

companies is illegal.

Differentiation:

• Market development• Market penetration• Product development• Product proliferation

Market Signaling:

Collusion on timing of new investments is

illegal.

THE GAME THEORY

COMPANIES ARE VIEWED AS PLAYERS IN THE GAME THAT ARE SIMULTANEOUSLY

MAKING CHOICES ABOUT WHICH BUSINESS MODELS AND STRATEGIES TO PURSUE IN ORDER TO MAXIMIZE THEIR

PROFITABILITY


PRINCIPLES THAT UNDERLIE THE GAME THEORY

1. LOOK FORWARD AND REASON BACK

2. KNOW THY RIVAL

3. FIND THE DOMINANT STRATEGY

4. STRATEGY SHAPES THE PAY-OFF STRUCTURE OF THE GAME


5.6TWO DISTINCTIVE

COMPETENCIES AND POTENTIAL INDUSTRY


DISTINCTIVE COMPETENCIES

1. PROMOTION OF SOCIAL CHANGE

2. DIVERSIFIED INVESTMENT BASE


AGRICULTURE


› SOURCE OF LIVELIHOOD

› CONTRIBUTION TO NATIONAL REVENUE

› SUPPLY OF FOOD

› SIGNIFICANCE TO THE INTERNATIONAL TRADE

› SOURCE OF RAW MATERIALS

› SIGNIFICANCE IN TRANSPORT

› GREAT EMPLOYMENT OPPORTUNITIES

› ECONOMIC DEVELOPMENT


REFERENCIES

Itan, N. O’Connell, F. and Mason, K. 2014. A macro-environment approach to civil aviation strategic planning, Transport policy (Online), 33: 125 – 135. Available: http://www.Elsevier.com/ (Accessed 23 March 2015).

Sabol, A. Sander, M. and Fuckan, D. 2013. The concept of industry life cycle and development of business strategies, Active citizenship by knowledge innovation (Online), 635 – 642. Available: http://www.Elsevier.com/ (Accessed 23 March 2015).

Southall, R. 2010. The ANC & Black Capitalism in South Africa, Review of African political economy (Online), 31(100) : 313 – 328. Available: http://http://dx.doi.org/10.1080/0305624042000262310/ (Accessed 10 April 2015).

Strategy planning process (Online) . 2015. Available: http://www.tandfold.com/(Accessed 23 March 2015).

Thebe investment corporation (Online). 2015. Available: http://www.thebe.co.za/(Accessed 15 March 2015).


http://www.elsevier.com/

http://www.elsevier.com/

http://http/dx.doi.org/10.1080/0305624042000262310/

http://www.tandfold.com/

http://www.thebe.co.za/

advanced strategic management : thebe investment corporation

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