Why Investors need to spend on People Development across their SGB portfolio

29th March 2022

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(Maryanne Ochola, RIKA Founding Taskforce Member)

 

At a time when East African economies are not absorbing young people at the rate that they’re joining the labour force, investment in people development and talent management has never been more important.

 

However, the cost can be prohibitive for founders of small and growing businesses (SGBs) who must be focused on business growth.

 

With this in mind, RIKA founding taskforce member, Maryanne Ochola, states that the cost of developing talent and equipping HR managers with practical leadership skills, should be seen as an ecosystem issue with responsibility lying at the feet of investors and donors, not just business owners.  Here, Maryanne talks about the importance of practical HR training in East Africa in light of the fourth industrial revolution, the employment challenge on the continent, and why RIKA Learning is offering something completely different and highly relevant.

 

Maryanne, why did you choose to get involved with RIKA Learning?

“Essentially because I want to part of something that truly and practically cracks the talent challenge in small and growing businesses that are laser-focused on growth. “I got involved while working at ANDE (the Aspen Network of Development Entrepreneurs). The sponsor for RIKA Learning, Blue Haven Initiative (BHI), is an ANDE member.

 

BHI serves as an investor with active investments in Kenya and provides capacity building for institutions that strengthen businesses and promote governance and diversity across the continent, like The Boardroom Africa.

 

“We’ve been working with BHI to crack the talent challenge and RIKA is the solution”. As an SGB founder, $6,500 to send an employee on the RIKA Learning HR Leadership Programme could be seen as cost prohibitive. Is it?

 

“If you look at it merely as a cost, it could be seen as prohibitive. However, when you see it as an investment, it becomes an attractive proposition. A comparable quality program abroad costs three times as much.

 

“We are really looking to encourage organizations and leaders to see the investment in human capital as a driver of productivity and growth - an investment.

 

“We want our small and growing businesses to grow because we need to create jobs. We need these businesses to grow so they can employ more people. So, it should be an ecosystem approach.

 

If you’re a venture capitalist or an impact investor making an investment into an SGB today, you should factor the cost of people development into your investment.

 

If you’re a donor, there should be grants targeted at people development because ultimately it will help SGBs to unlock the bottom line if they have motivated employees, if they become a ‘go-to’ SGB for talent.

“Investors and donors need to think of investing in talent development as a catalyst for a fundamental shift in the ecosystem, not just that they’re carrying the cost.”

 

So, this is a call for investors and donors, not cash-strapped SGB founders?

“Yes. As an SBG founder, growing your bottom line and attracting investors to help you scale is what your eye is trained on. So, your people strategy has to have an ROI if you are going to divert fast cash flow to support employee growth. How do you balance that? How do you make the case for talent and people strategy in a business that’s focused on growth and financially stretched? This is the responsibility of the entire ecosystem.”

 

Understanding the African market is critical then?

“Let’s set the scene: Three in five Kenyans are under the age of 25, so we’re starting from a base where we have an active youth population. The education system in Kenya is geared towards a traditional white-collar job, in a very theoretical way and the reality is that a lot of young people will not get those formal contracts simply because companies are not growing at that speed.

“Even if you were to get a contract and land in an office, you’re not ready for the soft skills that come with showing up to work on time, interacting with colleagues, learning on the job.

 

So, a lot of learning and upskilling has to happen in the workplace - there’s a dissonance between the education system and the formal sector.

 

“The RIKA Learning Programme, for me, is to start from a place of reality. It’s for the reality of Africa’s young people and HR professionals. What’s the reality of a people manager today? What challenges are they facing day-to-day? But also, when you think about the future and where the business environment is going. What are those headwinds?

 

What’s RIKA Learning doing that’s unique and exciting for SGBs, the HR community, and investors?

“There are lots of programmes out there; they’re all catering to a need. But what’s different and special about RIKA is that it’s built for what’s happening right now but also for what’s coming.

“We’re talking about more young people entering the labour force, we’re talking about technology disrupting literally every aspect of how we run our businesses, including how we engage our employees, how we recruit them, how we motivate them. The other thing is that it’s very context specific.

 

“The RIKA taskforce is made up of seasoned HR professionals who understand this market inside out. It has not been designed by academics; it has been designed by practitioners. I think this really places it a cut above the rest.

 

“It’s not just a 12-week course, it’s building a community of HR professionals from all different sectors and business sizes – something you can tap into forever. And it’s designed for the continent, which I haven’t always felt when I’ve attended international programmes and I’m the only African.”

 

Finally, Maryanne, while we’ve got you, what skills do young people need to succeed?

“What happened in the past is that as you went through school, you’d position yourself towards a model employer, but a number of factors have conspired to make that just not practical for most people. There are not enough jobs to go around.

 

“During COVID-19, we have demonstrated in real time that we can work from anywhere, which has opened up opportunities to work in any geography."

 

The internet has opened up markets that were not being served before – there are businesses that are not looking to hire a lot of people but are looking to tap into specific skills (as gigs) as they need them.

 

“For young people who don’t have families yet, I would say don’t think of yourself as an employee, you are selling your time, use that time to build up your soft skills, as an opportunity to try out a lot of different things – coding, copywriting, UX, while you’re still learning a skill at school.

 

“My daughter wants to be something different every day, one day a ballet dancer, the next day a sweet shop owner so she can eat all the sweets. I tell her she can be all of things if she wants to be, that’s the power of the gig economy. We just need to make sure we’re supporting young people with developing practical and leadership skills, like those taught as part of the RIKA Learning HR Leadership Programme.”

 

What is the RIKA Learning HR Leadership Programme?

It’s a fully virtual, 3-month programme, designed to equip HR professionals and leaders who are either mid-way through their career or somewhere near the top of their game with the skills needed to thrive in the fourth industrial revolution (4IR).

 

Download the brochure to find out more.