South Africa: Carrying a Bright Torch First Lit By a Visionary Past

Source from:  Business Day (Johannesburg) 25 August 2008 08/26/2008

WHEN Junior Ngulube joined Munich Reinsurance Company of Africa (MRoA) in 1987, transformation was an issue still miles off the radar in SA. MRoA's then CEO, Ernst Kahle, however, was a maverick among business leaders, a visionary who championed transformation during one of the most volatile times in this country's history. Kahle served as an inspiration to his employees - Ngulube included - at a time when black people were still largely excluded from big business. It is therefore somehow fitting that Ngulube became the first black CEO of MRoA, 20 years after joining the company under Kahle's leadership. And while Kahle has since passed on, his vision of transformation remains alive with the new man at the helm. Ngulube -- appointed as CEO in October last year - says he has taken leadership of a company in great shape. "MRoA is the largest reinsurer on the continent, operating within 45 African countries, and recently posted strong underwriting results for 2007 despite the fact that several short-term insurers are reporting a downturn in profits," says Ngulube, who plans to extend the company's good form well into the future. "As a leader," he says, "I play my game five or even 10 years ahead and leave the day-to-day issues largely to my managers." He describes his leadership style as "soft on people but tough on tasks", which is informed by his belief that in all dealings with people, a leader must focus on the task and protect the other person's dignity at all times. He also believes that leaders have to lead to "somewhere", and that defining and selling this vision and strategy, while ensuring he takes his people with him, is the most crucial role a leader has. As far as vision and strategy go, Ngulube says that the priority for business in SA -- and globally -- in the years ahead will be skills development and transformation. "Looking forward, it is clear that the competition for skills will continue to intensify and become the key challenge for businesses, especially those in the financial sector, in the years ahead. We therefore need to start developing people faster, and better, than was previously envisaged," he says. "The skills challenge is further complicated by the fact that today's employees are knowledge workers who know what they want and will simply leave a bad employer." MRoA likes to think it is the opposite of a bad employer and the statistics bear this out. The company has been an equal opportunities employer since the 1980s and has outperformed the transformation goals set by the financial services charter in almost every category, with more than 50% of its middle management made up of black people -- 20% of whom are black women. This is one reason Ngulube gives for the company's consistently positive financial performance. The past financial year saw MRoA post a 25,4% increase in gross premium income to R3,2bn, and net income after tax amounting to R230,4m. And the drive towards transformation is not slowing. Since his appointment as CEO, Ngulube has made sure that the issue remains high on the agenda of every employee and manager at MRoA and, more importantly, that it is not seen as an antiwhite crusade, as the company still employs and promotes white staff internally. Ngulube believes that this focus will help to position the company as the employer of choice for talented, previously disadvantaged workers entering the job market and so help it to mitigate the effects of the skills shortage challenge in the coming years. To him, growth and transformation are flip sides of the same coin and there is a real business imperative for pushing the transformation agenda more robustly. In addition, he says the window of opportunity to develop needed skills is fast closing and business needs urgently to start bringing the majority of South Africans into the workforce to ensure the country can continue on its growth trajectory of the past few years. "It has been more than 10 years since the birth of our democracy and we have been very lucky to have a government that is business-friendly," says Ngulube. "Unfortunately, however, company transformation in general has not been good enough. This type of scenario causes a lot of frustration and that is now manifesting itself in a growing support for left- leaning politics. "If business doesn't push transformation hard enough we may find ourselves in a situation where the government of the day is not as friendly as it has been. "This would really not be favourable for business in this country," he says. "Essentially, we need a strong and large black middle class in order to ensure social, political and economic stability. "Our current distribution of wealth is patterned like a very pointy triangle whereas what we really need is more of a diamond shape -- with a large middle class and far, far fewer poor people," he explains. Ngulube recently witnessed first hand how a large middle class can influence the economic and social stability of a country -- during an 18-month secondment to the headquarters of the Munich Re Group in Germany. He was tasked with the job of setting up a new unit to establish a global management reporting framework for the reinsurance group -- which he did with great success. It is hard to believe that someone with such leadership capability and business acumen originally studied agriculture and had dreams of being a tobacco farmer. "In 1986, after working for five years in the agriculture ministry in Zimbabwe, I planned to start working first as a farm manager, and hopefully thereafter on my own farm, but I made the 'mistake' of getting married the same year," jokes Ngulube. "My urban wife refused to live in the sticks with me and I had to find a job in the city. You could say that it is because of love that I am where I am today." But it is not just the love of his wife that keeps him where he is; Ngulube also loves what he does. Despite his many accolades, he describes his greatest career achievement as becoming the first black CEO of MRoA. "This company has a proud history and many people do not know that the ANC's headquarters today -- Luthuli House -- was the MRoA building when I joined. When Nelson Mandela came out of prison, Kahle rented the ANC two floors of the building when no estate agents would touch them." MRoA's history of being a leader in the field of transformation is not limited to SA. As one of the original shareholders of Swazi Royal Insurance Corporation (SRIC), MRoA committed to transform the insurance sector in Swaziland 35 years ago. Ngulube was recently recognised at the 35th anniversary celebrations of SRIC for the role played by MRoA in that country in terms of skills development and upliftment. "As the market opens up in Swaziland, we can say 'mission accomplished' as we now have in place a solid, well-run and profitable company, managed fully by Swazi people whom we have helped to become empowered over the years. "This is a legacy I want to carry forward. I know that wherever Kahle is today he is smiling because his transformation vision has finally been fulfilled." Enditem