Citizen of the world

Abré Pienaar exemplifies the expression "a citizen of the world." As chief executive of South Africa-based iPlan Industrial Engineers, he has supervised projects in Africa, Europe, Asia, and the United States. But Pienaar's global outlook is not simply a matter of being widely traveled. His experiences as an industrial engineer and as an academic have helped him become an open-minded observer of the interaction of technology and people in supply chain systems.

Pienaar currently is the Planning Chair of CSCMP's Board of Directors and served on the Education Strategies Committee from 2004 through 2006. As co-chair of CSCMP's 2006 regional conference in Dubai, he played an active role in bringing supply chain professionals from the Middle East, Africa, and Asia together to share best practices. He has numerous professional and academic achievements to his credit, including a bachelor's degree in mathematical statistics and a doctorate in industrial engineering. He continues to be involved in engineering curriculum development and has published a book on manufacturing systems.

In a recent interview, Pienaar discussed what is unique about doing business in Africa—and what is universal about managing supply chains and people everywhere.

South Africa is something of an outpost in a far-off corner of the world. How has CSCMP helped you learn about supply chain best practices that you have been able to adapt to your business?
With the globalization of business and what The World Is Flat author Thomas L. Friedman calls "the flat world," there no longer really are any places that can be considered "outposts." The business world has become globally integrated regardless of geography. And that is precisely how CSCMP is playing a major role in disseminating best-practice knowledge globally—including via the Southern African Roundtable—with meetings, seminars, short courses, and networking opportunities.

What percentage of your business is within South Africa, and what percentage is global?
We work on project assignments, so the percentages vary with each one. Over the last five years, I would estimate that about half our work has been in South Africa, and the other half was evenly split over the rest of Africa and throughout Europe, Asia, and the United States.

We talk a lot about global business practices. Are things done differently in South Africa?
Best practices are best practices, so for the most part, the best way to run a warehouse in Cincinnati, Ohio, is also the best way to run one in Moscow and one in Cape Town. There are some differences—for example, in the way road freight transport is managed and in the local cost of high-tech solutions—but it is really easy to exchange people from South Africa and other parts of the world because everybody essentially follows the same best business practices.

What kind of cultural and language difficulties do you encounter that are unique to Africa? How do you deal with these?
The cultural and language difficulties that one encounters in business are not unique to South Africa, the rest of Africa, or even the rest of the world. It is a fact that virtually everywhere, people work in teams composed of others from diverse backgrounds and different cultures. Language tends not to be an impassable obstacle since the global business language is English, but cultural, religious, racial, gender, and nationality issues are extremely sensitive. How do you deal with these issues? Implementations simply have to be structured very carefully around local sensitivities or they will surely fail.

What are some of the challenges you face as you conduct business in the four corners of the world?
Best practices are similar all over the world, as I mentioned earlier. However, implementing best practices— and making them work consistently—presents dramatically different challenges in different parts of the world.

For example, my company, iPlan Industrial Engineers, found that an implementation we did in Joplin, Missouri, required tremendous attention to roles and responsibilities, organizational politics, and individualized people issues but the technology aspect was easy. For an implementation in Uganda, Africa, the technology and logistics were hugely problematical but the people were extremely capable and cooperative, so business processes were designed, accepted, and implemented with very little fuss and pushback. In Hong Kong, we faced cultural and language obstacles to the usual implementation methodologies and had to follow some convoluted workarounds before we got people's buy-in and could proceed.

There was a time when South Africa was banned from a lot of corporate commerce. Then the government dismantled apartheid and freed Nelson Mandela. How did those actions change things for leaders who were managing supply chains in your country?
Those actions opened up the world to South African expertise and know-how. The South African Breweries Limited is now the third-largest brewery in the world, Richmond is one of the top luxury goods companies in the world, and even a small consulting business like mine can easily contract with and work at many places around the globe.

How is doing business in South Africa today different than it was before the dismantling of apartheid?
South Africa is now part of the integrated global business network of the 21st century, whereas before, virtually all economic activity was bottled up at the southern tip of Africa. In addition, South Africa is now considered the gateway into Africa for the rest of the world in terms of logistics, skilled people, and the ability to get things done.

What can South Africa do to help bring the rest of Africa into the global marketplace?
It's already happening. South African expatriates are living all throughout Africa—running businesses and implementing 21st century technology, education, and teaching. For example, MTN is a South African cell-phone operator that is bringing communications, including data networks, to millions of Africans all over the continent.

What example can South Africa offer other countries that are seeking to participate in the global economy?
You're either in or you're out of the global economy; there is little chance for half measures. If you want to be in, you have to embrace global economic principles and you have to empower people. As a country, you have to look forward to where you want to go, not dwell in the past.

As the manufacturing centers in India and China bring new prosperity to those coun- tries, it seems logical that the next frontier of low-cost labor could be Africa. How is South Africa poised to capitalize on this potential opportunity?
The assumption of low-cost labor is not necessarily correct. What Africa does have is vast reserves of natural resources. South Africa essentially built a first-world economy in the developing world by reinvesting proceeds from resource sales—in this case, gold in the early and mid-20th century. Individual South Africa-based companies and even individual South Africans are in the forefront of efforts to do the same in other African countries, from mining operations in Ghana to oil in Angola and Nigeria.

As CSCMP's planning chair for 2007 through 2008, what is your vision for this role?
Over the last few years, CSCMP moved from a mostly U.S.-based, mostly logistics-focused association to the global champion of supply chain management. In my role as Planning Chair, I see us accelerating that process to more firmly establish a global footprint in supply chain management while simultaneously maintaining and even expanding our leadership base in logistics.

What supply chain advice can you offer to companies looking to augment their growth strategies?
A corollary to the "supply chain" is the so-called "demand chain." The principle is that the final demand from the end consumer determines the value of any product or service. The sum total of all the value-adds by everybody in the supply chain cannot exceed this number, regardless of how the accounting is done. Companies looking to augment their growth strategy would do well to understand what this value is and to use that to construct their entire supply chain.

You have a background in industrial engi- neering. How is that helpful in the supply chain management arena?
Industrial engineers are taught to examine the interaction of technology, people, and finance to search for optimum solutions rather than maximize any individual machine or operation. Supply chain management expects that there will be more benefits for everybody if the individual functions within a business entity and the individual business entities within a supply chain all collaborate to pursue a common goal instead of looking after their own interests. The guiding philosophies are exactly the same, and my experience has been that industrial engineers easily transition to supply chain management.

Is your Ph.D. helpful in your business?
I earned my Ph.D. some time ago in engineering, so the specific details are probably now out-of-date. However, the lessons learned, such as keeping an open mind and not blindly accepting the status quo, researching what others have done to avoid reinventing things, crediting others where credit is due, and so forth still greatly influence my day-to-day business activities. At the same time, I do enjoy my part-time association with academia, and the Ph.D. was the entrance ticket to that part of my life.

What advice would you offer to students entering the supply chain field?
Get as much breadth of experience (as opposed to depth) in your early years as possible. There will be time enough to become a specialist if you understand that supply chain management is about the strategic integration of many disciplines rather than a focus on any particular area, such as logistics or procurement.

i understand that you and your family are avid horseracing fans. what kind of planning goes into this sport, and why do you love it?
My wife and two daughters ride endurance horse races. I personally don't get on the horses, but there is a lot of logistics that happens before, during, and after the race.

Like the business world, where it takes a lot of planning and a team of people in the back office to enable a solitary salesman to clinch the deal, my whole family is intimately engaged in helping one of my daughters win a 100-mile event. Strangely enough—and maybe specific to the endurance events—I think of horseracing as a team sport where each is doing his or her part in pursuit of a common goal. Just like supply chain management.