By Carel Venter
The business advising profession is on the cusp of taking big steps towards ensuring the delivery of quality support to small businesses and entrepreneurs. This was the topic of the May episode of the IBASA & EPI Webinar Series, where the recently published draft discussion paper was featured, titled Improving the Quality of Business Advisory Services in South Africa: To Stimulate Debate, Policy Consideration and Strategies.
The discussion paper was published by a group of entrepreneur eco-system stakeholders, including SEED, DSBD, SEDA and the Services Seta’s ECDI. It is intended to be a contribution to solicit participation by business advisers in this debate about their profession, with comments closing on the 30th of May 2019.
The webinar was hosted on 22 May 2019 with some of the co-authors of the discussion paper joining as panellists such as Liesel Kӧstlich from the Services Seta’s ECDI, Div de Villiers from SEED and Prof Edith Vries, ex-DG of the DSBD. Some IBASA members, including the MD Dr Andre du Preez, stakeholder relations director Joseph Tshiwilowilo and Eastern Cape regional chair of IBASA Dr Ricardo Dames, also joined the room to offer their perspectives.
While it is a logical step to aim to ensure that quality business adviser support is available to new and growing businesses, the question remains, how do we best assure the quality service that is needed on a national scale?
Liesel Kӧstlich started the webinar off by asking “Why do we need to improve and regulate BA quality”? The authors of the discussion paper agreed that small business clients need some level of protection regarding the services they can expect from business advisors.
She explained that the intention of the discussion and the draft paper is to bridge gaps in the sector. It will hopefully also better guide the government to control the quality assurance of services business advisers provide to the market. She pointed out that the authors do not have all the answers and that there are still many questions to address. Thus, the need for a draft discussion paper, followed by input from various parties.
She stressed that quality assurance is a continuous process, not just an event, which is already unfolding for more than a decade. Seda has done much work on standards, supported by discussions at ICBA 2017 and taken forward by the DSBD Director General in 2018. It was agreed that, in order to steer its own future, the industry needed to document the options available and guide the narrative.
Three government groupings were identified by the authors as having a key role in improving the quality of Business Advising Services (BAS):
- Structures involved in education, including SAQA and professional bodies,
- The DTI and institutions such as the SABS and SANAS, and
- The DSBD and its agencies such as Seda and Sefa.
Moving on to the discussion paper itself, Div de Villiers focussed on the key issues raised in the paper.
The lack of standard terminology and understanding of terms like Business Adviser, Business Coach, Business Mentor and Business Consultant is posing some challenges. He mentioned that a process is needed to define common terminology, which also includes the use of terms such as Business Advisory Services (BAS) versus Business Development Services (BDS). He explained that a common understanding is that BAS forms a component of BDS, as reflected in the image to the right.
He explained that three main market categories were identified in the paper, namely, Entrepreneurs, Emerging and Small Businesses and Big/Corporate Businesses.
To understand how the supply-side of BAS address this market demand, the level, nature and specialisation of BAS were explored in the paper. This approach assisted in distinguishing Business Advisory Services to include Entry, Intermediate and Advanced Levels as well as Functional and Sectoral Specialisation. Their finding is that the nature of BAS (including consulting, advising, coaching and mentoring) is mainly dependant on the demand side (i.e. the type of client and their specific needs).
Business Development Services, while also displaying Functional and Sectoral Specialisation, is classified based on Delivery of Shared Services, Access to Markets and Access to Finance. It is more enterprise than entrepreneur focussed and diverse depending on the need and size of the business being supported.
While four categories of BDS were identified, namely Government (all levels of government as intermediaries and education as implementers), Corporate (through CSI, ESD, SD and CDSP programmes), Non-profit (as intermediaries and implementers) and For-Profit (as intermediaries, implementers and individuals), there are some partnership programmes that bind them.
The main part of Div’s presentation covered the four strategic themes identified in the discussion paper, namely Professionalisation, Regulation, Standards and Education & Training.
Download the detailed discussion paper here.
Regulation may include an option for Government Regulation where licencing, monitoring and enforcement would be managed by a government-appointed agency. Another option is more focussed on professionalisation via designations, competency standards, assessment, verification, grading and professional certification. This would fall under the control of statutory or non-statutory professional bodies.
Div shared that there are existing ISO 20700 guidelines, but that these are focussed on how to manage a consultancy service, rather than business advising.
Education and Training is also covered in the discussion paper. This is already regulated by the qualification authorities in term of skills levels and relevant NQF levels. The Services Seta controls the NQF 4 to 6 levels and the Department of Higher Education levels 7 to 10. Some of the registered qualifications in business advising have expired, while others are getting very little traction in the marketplace, which may point to the need for revisiting the qualifications.
Attendees of the webinar indicated that they prefer self-regulation rather than government control of the industry. During a poll asking if the registration of business advisors should be a requirement to offer BAS, 82% of attendees supported accreditation through professional bodies, while 67% wanted it to be compulsory and 15% wanted it to remain voluntary.
Div summed up the discussion paper findings as:
- Professionalisation through professional bodies has expanded over recent years but needs to grow further.
- Calls for mandatory professionalisation and a confederation of professional bodies remain unresolved, while the Industry expresses a preference for self-regulation.
- The initiated process by the SABS to develop a SANS for BAS needs to be completed.
- The scope, application, outcomes and recourse need doe quality assurance in BAS are to be considered.
- Consolidated supply-side data is needed to assess the adequacy and inform skills development priorities.
- A re-alignment between occupations, competencies and qualifications needs to be done.
Prof Edith Vries highlighted that it is important to agree that globally small businesses are recognised as key drivers of wealth creation, poverty alleviation and job creation, while small businesses form an integral part of the South African economy by providing income and dignity to millions of people”. Yet, small businesses only contribute 40% to GDP and 60% of employment.
She suggested that South Africa needs 3 million new small businesses and thus would, at a ratio of 50:1, require 60 000 new business advisers. The work in the small business eco-system should be aimed at achieving these aspirations.
She strongly argues for the professionalisation of the industry but highlighted the large number of bodies needing some level of coordination or even regulation. For her, the focus must be on delivering quality business advising services to small businesses and protecting them against sub-standard services.
Liesel closed off the presentations for the webinar by highlighting that the team wants to address some content gaps by doing case studies to improve their understanding of the challenges. They agree that there is a great need to refine terminology and definitions amongst eco-system stakeholders. The team also want to better articulate responses to some small business policy developments underway at the DSBD.
Stakeholders are encouraged to make submissions in reply to the discussion paper, after which the plan is to conduct workshops in the second half of 2019. After the workshops, the final paper will be published with some recommendations.
The clear indication is that business advisers will have to join professional bodies to improve the quality of business advising for the benefit of entrepreneurial success. Interestingly, those who attended the webinar are divided on if BAS is distinctly different from Management Consulting Services. During a poll, 41% said these are distinctly different because small business needs addressed by BAS are very different from the needs of large firms, while 33% said the skills needed are very similar.
- To view a recording of the full webinar, << CLICK HERE >>.
- The next IBASA & EPI Webinar, scheduled for 27 June 2019, will cover the important subject:
“How to Support Your Clients to Increase Their Profits with Sales Automation”.
<< CLICK HERE >> to register for the next episode in the IBASA & EPI Webinar Series (to be updated before publishing).
- Download the detailed discussion paper here.
Carel Venter is the producer of the IBASA & EPI Webinar Series.