SOUTH AFRICAN WINE & BRANDY COMPANY
MOBILISING THE WINE INDUSTRY TO SECURE EQUITABLE GROWTH:
A Plan for Strategic partnerships between the Industry and Government
Background statement
:The major strategic focus areas for this plan will be on
Submission:
The South African Wine & Brandy Company (SAWB) in collaboration with the South African Agricultural Business Chamber (ABC) could provide more details on growth trends in the industry, strategic activities in progress, and constraints as experienced by the various private sector entities in the industry. A report on the recent investment conference to mobilize funds for the wine industry will also be elaborated on. Through this presentation the SA wine industry wants to establish a basis for collaboration with the relevant parliamentary bodies and processes.
Prepared by:
C J van Rooyen SAWB: CEO
F Mafilika
O Bosman
L Fillis
N Vink
Contact no (021) 886-8992 or 082 785 3300
EXECUTIVE SUMMARY
Strategic alignment
The South African Wine Industry Strategy Plan (WIP) is a watershed commitment, driven by the South African Wine and Brandy Company (SAWB) to align the industry’s "Vision 2020" initiative, which focussed on designs for the future prosperity and global competitiveness of the industry, with the national drive for a "united and prosperous agricultural sector (the "Strategic Plan for SA Agriculture").
The ultimate aim of the WIP is to "achieve a better life for all in the wine industry through strategic leadership, collaboration and innovation" and thereby establish a "vibrant, united, non-racial and prosperous South African wine industry".
VISION
The Wine Industry Strategy Plan that is outlined in this document starts with an assessment of the transformation challenges facing the South African wine industry in the global and local context. In assessing these challenges, the Vision of the industry envisages that it is "… innovation-driven, market-directed, globally competitive, highly profitable and dominant in selected global markets – a producer of uniquely South African products of great quality, distinction and impeccable traceability records. The industry is a global enterprise with strong South African cultural roots – reflecting good citizenship and social responsibility. Our industry is leading socio-economic transformation and empowerment in South Africa through equitable access to resources, business opportunities, markets and decision-making of historically disadvantaged and economically marginalized South Africans. Through all this the industry will perform as a dominant economic force in the SA economy."
The South African Wine & Brandy Company (SAWB), a Section 21 Company representing the whole wine industry (farmers, labour, cellars and the trade) is tasked to drive and manage this vision and the Wine Industry Plan through a range of industry related programmes and responsibilities.
STRATEGIC GOALS
These strategic goals will be implemented through six industry programmes:
Strategy 1: Economic development and empowerment
The core focus of this strategy will be on economic development in general, to support Black Economic Empowerment and to enable historically disadvantaged groups in the wine industry to create economic infrastructure, exploit and participate in business opportunities along the full value chain in the industry.
Strategy 2: Social development and upliftment
The core focus of this strategy is to ensure that all role players, and in particular historically disadvantaged groups and individuals, are socially and organizationally empowered to make a constructive contribution to the industry and the country at large.
Strategy 3: Human resources development
The core focus of this strategy is to promote the human capacity development in the wine industry, establish a positive viable workplace image and to address backlogs in the supply of skilled workers to the industry in terms of international norms and standards; and in particular to create opportunities and access to historically disadvantaged groups and persons to participate in a productive and sustainable manner.
Strategy 4: Market development and promotion
The core focus of this strategy is to promote "Brand South Africa" through generic market development and provide promotional, marketing and business development services to the whole industry. This strategic programme will focus on wine, brandy and wine concentrates as distinctly different, but highly complementary components of the industry. Both the international and local market will be dealt with.
Strategy 5: Knowledge and information systems
The core focus of the knowledge and information systems strategic programme is to provide knowledge based industry information to assist strategic leadership and informed business decisions through analysis and intelligence.
Strategy 6: Technology innovation
The core focus of this strategy is the establishment of market directed and socially and environmentally responsible technology innovation and development and transfer systems.
SETTING A WINE INDUSTRY SCORECARD (WIS)
The purpose of the Wine Industry Strategic Plan is to align and focus the wine industry into coherent and integrated strategic activities and to create synergies with the three core strategies of the Strategic Plan for SA Agriculture. To this end a Wine Industry Scorecard (WIS) (established along the lines of the recently released Mining Industry Charter and Scorecard and other initiatives) will be developed to monitor progress.
The key principles of such a Scorecard are:
The Scorecard will provide a checklist of indicators that will be used by each signatory (enterprises, companies, SAWB structures, etc.) to implement appropriate transformation strategies and be monitored by the SAWB. A proposed checklist of indicators will be developed within the following categories.
Ten Point WIS Indicators to measure performance re:
The next steps in the implementation of this Scorecard are to obtain industry-wide agreement on the exact form of the scorecard, including performance levels and time scales for the different stakeholders. Once industry stakeholders agree on these matters, the industry will commit itself to the implementation of the Scorecard. In this regard, SAWB will be charged with responsibility to monitor progress with implementation, and will be subjected to agreed-upon "codes of good practice" and hard targets concerning the proportion of enterprises that achieve a satisfactory rating based on the Scorecard (for example SAWB will have to ensure that say 30% of all enterprises score more than 70% within three years, 50% within five years and 80% within eight years). In this manner the industry will reap the benefits of hard targets as well as the benefits of flexibility.
IMPLEMENTING THE WIP: INSTITUTIONAL AND MANAGEMENT SYSTEMS
Thus, the SAWB Mission is to "create a better life for all in the wine industry through collaboration and strategic leadership", the core tasks of the SAWB are:
Each of the WIP core strategies, strategic programmes and activities will be institutionalised into the SAWB operational system through functional business units and offices. Five offices are planned to support the SAWB: Socio-Economic Development; Human Resources Development; Technology Innovation and Transfer through the Winetech network; Market Development and Promotion through the expanding activities of Wines of South Africa and the SA Brandy Foundation; and Knowledge and Information Systems through SAWIS. A corporate support system will be instituted dealing with compliances issues, monitoring, certification services, industry analysis and intelligence, levy management, the legislative framework, etc. The various business units will interact with the stakeholder groups and forge partnerships with the appropriate institutions and organisations.
Systems will be introduced to institutionalise a coherent system of corporate governance. These will include a "code of conduct" and the institution of a corporate management matrix. Systems will be designed to accommodate innovation, participation and optimal stakeholder collaboration.
The implementation of the WIP will require the mobilisation of funds from industry sources and levies, government provisions, international donors and investors. The following principles will apply:
THE WAY FORWARD
The process to finalise (and evolve) the WIP in terms of operational "roll out" will require continued participative consultations and agreements with a wide range of stakeholders – industry groupings, civil society, relevant government ministeries, departments and agencies, the broader "Nedlac" environment, and where appropriate, international agencies. The SAWB, as representative body of the wine and brandy industry will engage such groups and promote such agreements. Interaction with the National Department of Agriculture and provincial departments, the Department of Trade and Industry, will be positioned as first steps in this regard. The aim will be to establish a "Wine Industry Accord" and "scorecards" between the wine industry, the government and other relevant role players to guide and strategically direct the evolving partnerships to meet the strategic goals of the WIP. This will confirm the WIP as a significant South African strategic commitment in the field of industry collaboration and strategic leadership to pursue a "vibrant, united, non-racial and prosperous wine industry".