500 NEWS

Book: The Power of Habit by Charles Duhigg
Publisher: Random House
Reviewer: M.E. Jacobs
My thoughts: 7.5 out of 10

The Power of Habit, written by award-winning journalist Charles Duhigg, encapsulates all our habits, from the individual level, organizational to entire societies – and it does so by using scientific research. That might seem a bold statement, but habits are nothing but learned behaviours, and these behaviours start somewhere. More importantly, the brain stores these behaviours and our actions into automatic routines. The trick to changing our habits, Duhigg explains, lies in understanding the habit loop. Most habits are formed the same way, starting with certain cues, followed by a routine and ending in reward.

Describing scientific experiments and case studies, Duhigg takes the reader on a journey of the mind. In part one, we learn that habits are formed in the basal ganglia, near the centre of the brain. Scientists know this because of two unfortunate individuals who experienced severe brain damage to that very area. These two individuals became the centre of much interest and research, and although they never knew it, they contributed to a much better understanding of how the human mind works, more specifically, how behaviours are formed.

On the individual level, Duhigg explains how we can’t really get rid of bad habits once they are formed, but we can change them. Using smoking as an example, he illustrates the workings of the habit loop. First, the smoker might see a packet of cigarettes – that is the cue. The routine kicks in, meaning he goes out for a smoke. The reward might be different for each smoker, taking the form of social interaction, a minor break from work, decreased anxiety levels or just a plain old dose of nicotine. The problem, Duhigg tells the reader, is not in changing the habit. We can all briefly change our daily routines. The problem is how to create and stick to the new habit. When attempting this difficult feat, it’s important to understand the power of the habit loop. Retain the cue and the reward, but change the routine. Instead of lighting up, the smoker might join his colleagues outside for a chat, or go across the street to the coffee shop to have a cappuccino instead.

When talking about companies, it becomes clear that some organizations have destructive habits yet still manage to show a profit. This is part thanks to structured routines that keep things running smoothly, even though different departments might be at war with each other. This internal civil war often leads to unofficial rules and unwritten guidelines by which the employees abide. Again using case studies, Duhigg shows the reader what can go wrong when these unofficial rules and guidelines break down but, encouragingly, what can go right when new and better official routines are implemented. Unfortunately, it often takes a company-wide crisis before new routines as sought.

In the third and final part of the book, Duhigg delves into societal habits. These habits, if examined without bias, can often lead to the uncomfortable area of morals and ethics. On a societal level, peer-pressure plays an interesting part. It is often looked at in a negative way, but as Duhigg explains, without peer-pressure the civil rights movement in 1960’s America might not have happened.

At times the case studies and stories can become a bit drawn out, and one feels that Duhigg might have been padding to reach the 250 page mark. This critique aside, the book shines a fascinating light on exactly how our habits are born and shaped into our behaviours. It also gives readers the much needed belief that we are able to control our habits and reshape ourselves and our company culture.

What I learned from The Power of Habit:

We are all at one time or another acutely aware of our bad habits and our seemingly inability to change them. I bought this book with one goal in mind, to try and understand my own habits and why I do what I do. If one is truly dedicated to finding the answers, it can be a shocking and revolutionary journey of discovery. Why do we procrastinate? What reward is there in not getting things done? If there is no reward, why do we persist?

The book also directs our thoughts to family habits, which in an organizational sense can be seen as routines. Our parents do the same things their parents did, leaving us in essence doing what our grandparents did. If these routines are in some way negative or detrimental, there is hope in understanding that we can change them.

Selected quotes

● “All our life… is but a mass of habits.” – William James (1892)
● “Routines create truces that allows work to get done.” – Charles Duhigg
● “You never want a serious crisis to go to waste.” – Rahm Emanuel
● “On a playground, peer-pressure is dangerous. In adult life, it’s how business gets done and communities self-organise.” – Charles Duhigg

Cedric Guilleminot is CEO of Onomo Hotels

Describe your leadership style.
I believe in participative management and unlocking potential and growth in individuals across the organisation, it is both satisfying and productive.

Your top tip to beat procrastination?
Keep your objective in focus, break it down in key achievable tasks and start the day with those. Don’t lose perspective and occasionally look back to see how far down the road you are.

Favorite getaway destination?
Iceland and Namibia are favorite nature getaways, easy to travel and mind-blowingly beautiful. Provence offers a perfect setting for relaxing with friends and family.

Who or what inspires you?
The team I work with, the people I have the fortune to meet, my children and music every day.

Your one wish for South Africa?
To have four. To embrace diversity and come together, it is an opportunity rather than a divide. To have the courage to reform, but also the will to accept it. To invest and facilitate investment in education and training, the true wealth of a nation. To improve foreign perception through better PR and safety – the visa issue, water crisis and reports on criminality only undermine a key driver of South Africa’s GDP.

If you could have any 3 people over for dinner, who would they be and what would you serve?
Nelson Mandela, Trevor Noah and Charlize Theron for an interesting dinner around wine and cheese.

What five pieces of advice would you give to aspiring young business starters?
o Find something you love (and are good at)
o Surround yourself with the right people
o Set small incremental objectives
o Accept failure as part of the journey
o Invest in yourself

What is the one thing most people don’t know about you?
I am a photographer.

What would you do with an extra hour in your day?
I already spent an hour thinking of that, so keep on dreaming I guess

Enjoy a unique wining and dining experience with Janse & Co and Richard Kershaw Wines. The stylish inner-city restaurant will be hosting a 5 course wine paring dinner experience with one of the most respected winemakers in the country on 7 August 2019.

The menu will be designed around the splendid Richard Kershaw wines, each course will be paired with one of their cool climate, site-specific, clonally-selected wines. Owner and winemaker Richard Kershaw will be there to guide diners through his wines and winemaking philosophy.

Event Details
Date: 7 August 2019
Time: 18:00 for 18:30
Price: R995
Venue: Janse & Co

Booking are essential: call 021 422 0384 or email reservations@janseco.com

By Gary Allemann, Managing Director of Master Data Management

The Internet of Things (IoT) and Machine to Machine (M2M) communications are by no means new concepts, having existed for many years already. What is new and revolutionary is what we are now able to do with the data these technologies generate. From predictive maintenance to consumer behaviour analytics, facial recognition to fraud detection and prevention, there is a wealth of value to be gained. However, these applications require a shift in mindset, from storing all data for retrospective analytics to analysing data on the fly and then dumping it. This new paradigm of streaming analytics is key to leveraging value from M2M and IoT data.

The genuinely revolutionary aspect of IoT and M2M is its ability to generate always-on data. Human-generated data is and always has been finite. While the volume has increased over the years, it is still subject to limits that sensors and machines simply do not have – these objects can generate thousands of data objects every minute, and they are inexhaustible sources. While this means that there are now limitless sources of data for analysis, it also means that unless something changes, we have to find a way of storing infinite data volumes. This is just not possible even if it were financially viable.

The constant and relentless nature of ‘always-on’ data generation also makes real time analytics even more important. Much of this data is only relevant now, in the moment, and once it is historical it no longer has worth. It must be analysed immediately and then deleted, otherwise no value can be gained. For example, a machine sending a signal every 30 seconds communicating that its status is good, is important information. However, it does not need to be stored because it is worthless after the signal has been sent. It also only requires action if something changes, which can only be ascertained if this data is being analysed in real-time.

Without this instantaneous and continuous analysis, critical information might be missed. This is driving the emergence of the streaming analytics stack, enabling organisations to analyse data on the fly without storing it. However, this technology is still in its infancy, and while a number of open source technologies exist, such as Apache Kafka, they are by no means enterprise-ready. There are no audit trails or governance and no disaster or error recovery protocols.

In order to be of use in an enterprise setting, streaming analytics needs some sort of failover. This is critical so that it can still be available for analytics in the event of, for example, a network outage. Innovative commercial solutions are essential when it comes to solving problems that are only just beginning to emerge. Our partner, Syncsort, is leading this charge with enterprise-ready streaming built into broader data integration stacks, helping to pave the way for success in streaming data pipelines.

While the need for such solutions has emerged from the growth of IoT and M2M data, the same real-time analytics platforms have far broader business application. They can be leveraged to great value in any analytics scenario for enhanced processing speed, flexibility, agility and more. Real-time decision-making ability is the future of analytics and we need to gear up for this or risk being left behind.

A revolution in service led urban living, BlackBrick has launched an entirely new residential concept in the centre of Sandton, Africa’s economic capital . Conversion of the building at 25 Fredman Drive, formerly home to the offices of SAB / ABInBev, is already underway and will soon be home to 208 apartments including a hotel component in an environment anchored by hospitality and community, with a world- first residential club membership offering.

Buyers into BlackBrick automatically become club members – as will the tenants who rent the apartments. Membership will allow for use of the property’s extensive facilities, which include a cafe, work spaces & boardrooms, boxing gym, rooftop boma, dining lounge, cinema room, library, meditation garden and more.

“The vision is to eventually offer BlackBrick members access to a network of residential clubs, which allow for fluid, facilitated movement between BlackBrick properties in different cities,” says BlackBrick Founder Moritz Wellensiek. “The way people live and work is changing – and it’s not a cycle, it’s a systemic change. The rise of flexi-hour workdays, hot desking and mobility means that people have different requirements when it comes to their homes, too. We see BlackBrick as the future of flexible living, where members will be able to move freely between cities on both a short and long-term basis”.

BlackBrick pricing starts at R950 000 with studios, 1-beds, 2-beds and Penthouses selling for around 40% lower than the nearest-comparable properties in the area. The accessible pricing means that rental pricing can start at around R8 000 per month. Units on the hotel floors are sold with a guaranteed yield which gives the investor a reliable monthly income. “With sales getting off to a strong start and outperforming the rest of the market, we are excited about the traction to date, as we are about to hit the 50% mark after only 2 weeks of sales,” says Wellensiek.

The turnkey offering includes a number of bolt-on packages which can be added to the apartment purchase, including a tech-pack, electric bicycle, car sharing and more. Most notable is BlackBrick BOX, a furniture brand which is a partnership between BlackBrick and Weylandts, aimed at providing high quality yet accessible furniture to the urban market. The BOX range includes customized pieces designed to maximize space in the apartments with clever touches like folding tables and high-tech beds with lockable storage.

The lockable storage is a nod to accommodating the commuter who visits Sandton for business regularly, preferring a home to a traditional hotel. “If a company buys an apartment, they could use it to facilitate stays for numerous employees on a rotating basis. It’s part of our vision to revolutionise the way people live and travel,” says Wellensiek.

The Sandton BlackBrick building is being developed with investment from Empowered Property Fund, Setso, and in partnership with HB Realty who have a long track record of delivering high quality projects at scale, which is seeing the BlackBrick apartments constructed to an incredibly high standard while remaining accessibly affordable,” says Wellensiek.

The BlackBrick development is in line with global trends which are moving towards high-density mixed-use urban living. Locally this is being driven by the City of Johannesburg’s Spatial Development Framework 2040, an initiative which aims to promote residential opportunities in commercial nodes.


Elements of the BlackBrick experience are on show in the building, with viewings available via appointment.

South African retail has seen a significant shift in the last 10 years, with disruptive changes in the landscape. According to a South African eCommerce Insights report, approximately one-third of shoppers use e-commerce and another 6.5-million users are expected to be shopping online by 2021.

A recent Economist Intelligence Unit report used bespoke Canback consulting data to highlight countries and metro regions in the African continent with the biggest potential for e-commerce growth while highlighting key trends and developments in the market.

Top 6 takeaways

1. South Africa is a country primed to take advantage of the potential of e-commerce – mobile penetration rates are high, infrastructure is more sophisticated, and the middle class more expansive and willing to engage in online purchasing.

2. Still, the country lags behind the US and Europe in terms of e-commerce. World Wide Worx, a local technology research firm, estimates that global online spending surpassed R9-billion (US$610-million) in 2016, reaching the important milestone of 1% of the R900-billion overall retail market.

3. Online retail has been growing by more than 20% per year since 2 000. A 2015 study by Ipsos revealed that 22% of South African internet users said that they had made purchases online and 48% expected to do so in future.

4. Many South Africans engage in cross-border shopping. In 2016, around 43% of South Africans shopped across borders.

5. Mobile penetration and infrastructure are advanced in South Africa compared with the rest of the continent. The market has reached maturity, with a penetration rate that is forecast to rise to just under 197% by 2021.

6. This rise is likely to be fuelled by the demographic shift of greater numbers of black South Africans joining the ranks of the more affluent, with greater disposable incomes.

Stefano Marani studied Actuarial Science with an Honours in Maths of Finance before going into banking, first with Deutsche Bank in New York, London and Johannesburg before taking up a position with Morgan Stanley in London. His banking career was heavily focused on capital raising and executing particularly complex transactions, which gave him a taste for problem solving in the financial space. In 2009 he left banking to start his own business with his partners prior to acquiring the gas rights in the Free State with Nick Mitchell, the COO of Renergen. Since 2013 they have been running this company and building it from an idea into a dual listed company with substantial reserves, the world’s highest helium concentration and the first onshore petroleum production right in SA.

Describe your leadership style
I like to give people the opportunity to prove themselves by letting them assume as much responsibility as they are willing to assume. The door is always open so when they feel uncomfortable I can step in. I hate micromanaging or being put into a situation where I need to micromanage.

Your top tip to beat procrastination?
Umm. I’ll get back to you on this question.

Your favourite getaway destination?
Internationally, Italy is very hard to beat. Locally the north coast of Natal offers great entertainment value, my kids love swimming in the sea.

Who or what inspires you?
There are many people around with great stories on how through a mix of perseverance and determination have overcome the odds. Singling one person out without knowing them as people is much harder, so I look closer to home for inspiration and take enviable characteristics from each of my family members for inspiration. Each one has a special story.

Your one wish for SA?
That the whole country would adopt the culture of assuming accountability for actions, starting with the leadership. Instead of time-wasting and expensive enquiries, stand up and admit fault. This would solve many issues and get us moving forward whilst restoring our credibility internationally.

If you could have any 3 guests over for dinner, who would they be and what would you serve?
Going to take the liberty of assuming past guests too given it is hypothetical. The late 30 – early 40s Einstein shortly after his paper on general relativity. Nelson Mandela would need to be there, and to round the conversation off Bill Murray. I would serve some of the Italian dishes I learned to make from my mom.

What 5 pieces of advice do you have for aspiring business starters?
1. Think your business plan through, and test it with people who will give you honest advice and know the field you are building your business in
2. Set a realistic budget. When complete, make sure you have financial means to last for twice the length your budget requires
3. Keep your business plan dynamic. Often the most profitable part of the business is one you never thought would be
4. Don’t give up
5. Be very lucky

What is the one thing most people don’t know about you?
I wanted to go into acting and studied actuarial science as my back-up plan and then ended doing neither.

What would you do with an extra hour in your day?
The more family time the better.

Indlovu Gin is a world first. This handcrafted, juniper-led, twice-infused, distilled gin is made from elephant dung. Yes, elephant dung!

In an increasingly crowded market, the key differentiator is that the botanicals used in this gin are selectively foraged by elephants, and extracted and cleansed from their dung for infusion. Under the guidance of leading gin master Roger Jorgensen, Les and Paula Ansley created Indlovu Gin – an innovative gin that incorporates the foraging habits of the world’s largest land animal. Indlovu means ‘elephant’ in several African languages.

The Savannah vegetation gives Indlovu Gin its uniquely wooded, earthy flavours. The gin is a crystal-clear golden colour, with aromas of juniper, citrus and grass and an element of earthiness. On the palate are a blend of flavours such as juniper, angelica, citrus with earthy undertones and spice from the elephants’ favourite foraged botanicals.

PAIRING SUGGESTION
“Dark chocolate and coffee go very well with this gin.” – Paula Ansley

We review some of our favourite gin brands in the latest edition of Top 500. Looking out for this incredible six-page spread. To order your copy, send an email to marketing@top500.co.za today.

Roger Hitchcock, Senior Partner at the Sirdar Group shares some insight on the earning potential of a board member as well as trends and factors that contribute to the earning potential across various sectors. See article below for more info.

It’s not just retired executives that are looking to make an encore career in the corporate boardroom, with technology continuing to change the business landscape younger people are also looking for a seat at the table. So what can you earn as a board member?

How much are board members paid?
Based on the recent Sirdar research findings, for companies with turnovers below R697-million, fees ranged from R10 500 to R470 000 per annum. Companies turning over between R697-million and R1.4-billion paid non-executive directors between R97 000 and R317 000. Companies with turnovers above R1.4-billion set their fees between R92 000 and R1 million per annum.

In South Africa, PwC noted that the median chairperson fee across the entire JSE has risen to R595 000 (from R566 000 in 2017), while overall fees for non-executive directors at the median level increased from R492 000 to R518 000.

How are directors paid?
Ultimately directors are paid based on ‘what they can negotiate’. There is a range of practices currently being implemented, from ‘meeting fees’ through to fixed rates and retainers. The best practice for Independent Directors is for there to be NO link between the amounts paid and the short-term performance of the company (i.e. equity based). This is currently very much a developing area and a work in progress.

What are the determining factors to consider when remuneration is decided?
There does tend to be a number of remuneration thresholds for different sizes of business (size both in revenue and in terms of number of employees) as well as for different business sectors. These will logically remain underlying contributors to the way remuneration of directors is determined since the size and nature of different companies does determine the amounts payable and amounts different companies can afford. They will however probably become less and less of a primary or determining factor as the need to both secure and keep the right people on the board become more and more important.

In light of this, there are some other key points to take into account in determining what remuneration should and could include.

Who makes the decision about board director compensation?
The remuneration framework of the board should be included as part of the remuneration framework of the entire business. The board needs to oversee the development of this framework (which would include the elements to take into account in determining individual remuneration). The current thinking (and growing practice) is that this remuneration framework be put to the Shareholders for approval (at the AGM). This is currently a non-binding opinion where it is being practiced – but it’s anticipated that this will become more and more of an issue as compensation, of both executives and directors, continues to be a ‘hot-topic’ in the governance space.

Some key insights from the 2018 Sirdar research findings:

By Adrian van der Merwe, CEO of North Wind Digital

Technology is changing the face of business faster than industrialisation did. The Fourth Industrial Revolution is well underway and consumers and businesses are already using and benefitting from incredibly complex technology every day – even if they don’t know it.

The shift to cloud services has opened up incredible tech to even the smallest SME, reduced the cost of ownership and standardized processes for businesses – particularly in the finance function. Big companies have built customisation into their systems as a legacy because the software they historically ran their businesses on didn’t cater for their unique business model or requirements. Cloud solutions have evolved to cater for nuance – but, with that said, what cloud providers have done is figured out that there are only so many finance functions within a business, and standardized those solutions.

So now, instead of businesses customising software to suit their processes, they’re standardizing those processes to capitalise on the scalability and cost-saving advantages offered by cloud functionality. The impact of this boosts the bottom line because it reduces the need for an in-house development team – you don’t need people to maintain customisation if there isn’t any. Support and infrastructure are outsourced and upgrades – for better or worse – are accessed automatically. The switch to cloud has also made world-class tech available to the SME market, allowing smaller businesses to compete with far bigger players because they’re running the same background tech.

This switch to standardised cloud solutions has meant that it’s easier to adopt Robotic Process Automation (RPA), too. The software vendors themselves are building RPA into their tools because they’re aware of the fact that those tools don’t integrate easily into other products. This has allowed solutions providers to open Process Marketplaces, where vendors can simply go in and download, for example, the piece of code they need to log into SAP. That standardised login is available to everyone, for free, and doesn’t require any development. That has made RPA a lot more accessible to organisations and allowed them to adopt it more easily.

When businesses hear ‘Blockchain’, they think ‘Bitcoin’ and may not believe that the tech has any role to play in their operations. But what Blockchain really is, is Distributed Ledger Technology (DLT) – and that’s something that can revolutionise just about any business. Where, before, transactions had double entries, DLT allows for triple entries – meaning that external parties can verify transactions. The integrity of the transaction can be confirmed at source or destination, instantly – meaning that the timing of transactions need no longer delay business processes. The three-way verification offered by DLT also allows for more transparent monitoring of transactions – there’s a much smaller chance that something like the Steinhoff debacle would have happened if transactions were based on DLT. I’m not saying that DLT is instantly going to wipe out fraud and corruption, but with such incredible transparency, it’s going to be a lot harder to hide.

DLT is also going to change – or completely eradicate – industries that exist to broker deals between two parties, like the banking and legal industries. For example, we only use conveyancers because we don’t trust each other to complete transactions. They act as the middlemen in transactions and often charge eye-watering fees. The transparency and accountability offered by DLT can make such an industry obsolete – offering the same transactions, faster and at much lower cost.

The application of this kind of technology is as relevant in the Third World as it is in the First. In Africa, for example, we can apply the same tech in ways that provide relevant solutions. For us, applying DLT and Smart Contracts to in unregulated barter solutions would work like a bomb. In many markets across the continent, people don’t use cash to transact – nor do they feel the need to. In the presence of the right infrastructure, with access to tools like low-cost smartphones, you can make contactless payments and use DLT to quickly conclude deals in a system behind a user-friendly interface without either side ever knowing they’re using Blockchain tech. All this tech is readily-available and cost-effective – and it’s changing the way we all do business, every day.

Richard Flack is the Managing Director of Sureswipe

Describe your leadership style
I don’t believe in leaders of one and thus believe great leadership is exercised by a team of people. No one person is a perfect leader but a well set up team can get darn close. Buy in and ownership is important to me and I like to know that we are on the same page and pushing in the same direction regarding our purpose, vision and strategy. I also desire high levels of authenticity and accountability, as I believe this is necessary to be a team that wins.

Your top tip to beat procrastination?
Structure your days around priorities that add the most value to the business (and hence its people). I find that it helps to regularly prioritise my deliverables/work efforts and weigh them up against each other. When I know something is important and will add value to the business, it makes it much easier to get it done.

Favourite getaway destination?
The Kgalagadi Transfrontier Park with my family. Our love for the outdoors, wildlife and serenity make this one of our favourite places.

Who or what inspires you?
Making a difference in the lives of South Africans (and specifically my community, colleagues and clients) inspires me to keep going.

Your one wish for South Africa?
Two wishes… a thriving economy and the end of corruption.

If you could have any 3 people over for dinner, who would they be and what would you serve?
My mom, dad and sister (sorry Troydon; my sister’s husband, they only allowed 3). Fillet steak on the braai with a blue cheese and pear salad, and ice cream for dessert. Note: I assumed my wife and little boy were there already 🙂

What five pieces of advice would you give to aspiring young business starters?
Where to start. As Winston Churchill said in a very short commencement speech to a group of students: “Never give up, never give up, never give up!” I value perseverance as one of the most important characteristics when it comes to success in business. Sometimes you get some luck or favour early on in a business venture, but normally it requires a lot of faith in what you are doing and true grit to make it to the finish line.

I also think it is good to recognise that failure is part of life and business. No matter how good you are, there will come a time where you will fail. And it is good to acknowledge that this is not a bad thing but if handled positively is actually a good thing that helps you grow and develop as a leader. When I was in my twenties someone told me that you couldn’t raise startup capital in New York unless you had failed at a startup previously. Whether this was true or not, I took encouragement from it when I failed miserably at a mobile payments start up.

Linked to the above, I believe it is important to learn from your mistakes. This is one of the things that failure enables. You can work out what you did wrong and ensure you don’t do it twice. I realised early on that excel spreadsheets are amazing tools, but what they project from a profitability and break even perspective, is not necessarily reality. You can basically get them to tell you what you want, but you need a way early on to test the assumptions and ensure you have a business model that works. This can save you a lot of money.

In most cases you don’t have to build the Rolls Royce of products to test whether they can make the business money. Minimum viable products and early stage pilots can go a long way to getting you the answer you want.

Finally, I would encourage anyone thinking of starting a business to define their why. What is the purpose behind the business? What difference is it going to make in the world? Something really special happens when you can align selfish ambition to a purposeful objective.

What is the one thing most people don’t know about you?
I have situs inversus viscerum (Google it)

What would you do with an extra hour in your day?
Spend it doing one of my non work related passions; my family, my faith or wildlife photography. Managing my energy levels is really important to me.

Hailing from the ‘golden age’ of motoring, before overly assisted cars, numb handling and fake engine noises, the 1985 Porsche 911 Carrera Targa is one of the era’s most nimble roadsters.

Many will argue that the 911s of today are bloated or obese, carrying more weight than necessary to accommodate active driving systems and other ‘luxuries’. The same definitely cannot be said for the 1985 911 Carrera Targa, also known as a 930, I recently had the pleasure of driving, writes Nicole Forrest, our assistant editor.

No matter who you are, the 930 will do a great job of fitting seamlessly into everyday life. It’s everything a Porsche should be: compact yet comfortable and distinctively subdued. Its spec list might not be crammed with acronyms, but that’s part of its charm.

Get the latest copy of Top 500: South Africa’s Best Managed Companies to read the full review.