Doing Business in South Africa - Case Study Example

COUNTRY CULTURAL BRIEFING FOR BUSINESS ASSOCIATES Location The republic of South Africa is located at the most Southern part of African continent. It is located at the southern tip of the continent and it borders Atlantic and Indian Ocean. It neighbors Namibia, Botswana, Zimbabwe, Mozambique, Swaziland and Lesotho. It is located in an appropriate place which makes it act as a gateway to most of South African countries. The following is a map of South Africa as located in the South African region Adopted from: Christopher (2000) Atlas of Changing South Africa History South Africa has a long history with some of the most important archeological sites in the African continent. There have been many sites that have been excavated the reversal the history of the country as a home of Australopithecus. The country was inhabited by Bantu speaking people who were originally iron smelters, agriculturalist and herdsmen. The country was discovered by Portuguese in 1487. Bartlomeu Dias was the first Europeans to the reach the region and he named it as the Cape of Storms from the stormy conditions that were prevalent in the area but his sponsor renamed it as Cape of Good Hope. This is because it gave a promise of viable sea route to India the Portuguese were desperately seeking for. (Thompson, 2001) From the discovery of the region, the Dutch settlers followed and colonized the country. It became an important slave trade center for the region and Dutch settlement expanded. But it was the British who made an impact on colonization of the region when they annexed the cape colony in 1806. The Britons found the country ideal for slave trade. The discovery of diamond and gold in 1867 and 1884 respectively was perhaps the beginning of serious trade in the region. This was followed by mass settlement of whites in the country. South Africa carries the history of one of the worst form of racial discrimination in the world by the name apartheid. Under apartheid, there were different settlement and different public facilities for the white and the blacks. The was followed by a long history of struggle for freedom which was led by Nelson Mandela, a renown world figure, and the ANC party. Eventually Mandela was released after serving 27 years in Robin Island and the country was granted independence in 1994. (Kalley, 1999) Business wise, the history spins since the aforementioned discovery of Gold and diamond in the country. This led to establishment of commercial centers and large white farms that supported the trade. Since then the country has grown its economy to become the largest in Africa. Size South Africa has an area of around 470,979 Sq mi which is approximately 1,219,912 km2 which makes the 25th largest country in the world. It has a coast line that stretches fro more than 2,500 kilometers across the Atlantic and Indian Ocean. The country is made up of nine provinces with 52 districts. It has 6 metropolitan and 46 municipalities. These municipalities hold about 231 local municipalities. South Africa has a population of about 44,819,768 people which is one of the highest populations in Africa. Political System South Africa has a peculiar political system in the sense that it is the only country in the world that has three capitals. Cape Town which is the largest capital in the country is the center for legislative. Pretoria is the centre for administrative while Bloemfontein is the judicial capital. This is a peculiar political arrangement in the world but which has been planned to give the country a kind of equal representation in the political and legal matters. The country has a bicameral parliament with ninety members forming the upper house. These members form the National Council of Provinces. There are other 400 members who make the lower house or the national assemble. These members are elected directed by the people and their representation is based on population basis. Ten members are elected to represent each province in the National council of provinces but which is not tied to the population of the province. The lower house is given the mandate of forming the government and the leader with majority of members in the parliament become the president of the country. (Welsh, 1999) Currently the political scene in the country is dominated by the ANC (African Congress Party) and the Democratic Alliance Party. ANC is currently forming the government and Thambo Mbeki is the President. Economic System South Africa has been classified as a middle-income country by the UN. It has many resources with a well streamed financial system. This is supported a defined legal, communication and transport system. Johannes Burg Stock Exchange (JSE) is also ranked top twenty in the world which shows the strength of the South African economy. It has modern infrastructure system that supports the economy but the country is faced by time to time energy crisis. (William, 2004) Although the country has been classified as a developed country, this development is evident only in Cape Town, Port Elizabeth, Durban and Pretoria. They four regions form the economic centers while the rest of the countryside languishes in poverty. The country has the biggest economy in Africa and the highest per capita income. However it suffers income gaps which are compounded by the dual economy marketing which makes it a developing nation. Apparently, it has the highest income inequality in the world. The government has stepped up privatization which is likely to distribute income to all people. Language The country is home to more that 47 million people who are of diverse origins, cultures and languages. The majorities are black African, followed by whites, then colored and Indian or Asian are the minority in the country. The black are further classified into Zulu, Xhosa, Basotho, Bapedi, Venda, Tswana, Tsonga, Swaze and the Ndebele. All these are Bantu speakers with Basotho being the largest ethnic group. The white population is a mixture of Dutch, German, French, Huguenot, English, Irish and Scottish. The whites are further divided to Afrikaners and English speaking. Afrikaner speaks Afrikaans while the other speaks English. The county has eleven official languages including Sepedin, Sesotho, Setswans, siSwati, Tshivede, Xitsonga, Afrikaans, English, isiNdebele, isiXhosa and isiZulu. However, not all these languages are spoken frequently as Zulu, Xhosa, and Afrikaans are the most spoken language in the country. Traditions Due to its diverse cultural set up, it sometimes become difficult to understand clearly the traditions of South Africa. But it is evident that the country has evolved to develop a common tradition that suits all the country. Today, culture and social diversity have become more acceptable in the country like in all parts of the world. Food diversity has become accepted by all people in the country which has helped the country to market itself as a tourist destination. The tradition of south Africa have been engraved in food, music and dance which have become acceptable by the population and have helped to integrate the society especially after such ills as apartheid. Basically the traditions of the country recognize the family as a basic unit of the society which makes up the extended family and the tribe. This provides emotional and financial support especially for the business world. But while the colored and the traditional Afrikaans consider the extended family as their base, the English speaking population put more emphasis on the nuclear family. Traditionally majority of the white population dwells in the urban areas while the black dwell in rural areas. However with the coming of independence, more and more blacks are moving to cities. Values and ethics Value and ethics dictate the life of South Africans. There are several greeting styles which depend on the ethnic heritage and background of the person. But generally the young are supposed to greet the old people. It has been observed that while dealing with foreigners many South African will shake their hands while maintaining a smile and eye contact especially in the business world. However, some women do not shake hands and hence sometime it is good to wait for the reaction from the woman. It is acceptable especially in the business cycle for men to kiss woman on the cheek in place of a hand shake. South African attaches value to time and hence it is good to keep time when you are given an appointment in South African. They value relationships and communication. They are transactional and don't need to really establish a long-standing relationships while conducting business. Most of business relationships are built in office. Life Styles There are different lifestyles in the country depending on the ethnic and cultural background. While the whites lead an urban lifestyle, those in the village lead a rural kind of lifestyles. But the country has been slowly moving to a middle class lifestyle in both rural and urban areas especially with the upgrading of the slum life that has seen majority of the population move to the middle class bracket. With an increase per capita income, South Africa has been developing consumption culture which is changing their lifestyle. (Hein, 2002) Characteristics of the Culture The business culture in South Africa is characterized by strict etiquettes which dictate the way business is conducted in the country. Due toe the diversity of the country, there are several characteristics of culture that have been integrated to become one in the country. This has resulted common culture in the business cycle like the dinning etiquette, dressing code, meeting etiquette, business negotiation culture and others. (Hein, 2002) Business Practices Business practices in South Africa are determined by the complex culture that abound the country. There are some practices however that are common in the county like scheduling of business appointment in advance as far as possible. Some even plan is for a month or two in advance of the intended visit this is followed by a confirmation on the day before. There is also strict observance of time for formal business meeting. The working hours in South Africa are from Monday to Friday from 8 or 8:30 am to 5 pm in the evening. It is rare to find South African working on Saturdays or Sundays. There is a lot of respect for senior executives and colleagues in the business circle with the senior executives responsible for decision making in many companies. (Hein, 2002) Tips for leading in this country From the study, we can learn several things about living and doing business in South Africa. Some of them are: a. South Africa has a rich history of business. b. The country has a rich diversity of inhabitant with different lifestyles and different languages. To live in the country one has to understand all these factors. c. South African has strict business etiquettes and doing businesses in the country necessitates observance of some of these characteristics. Conclusion Being a business leader in South Africa, one should understand the characteristics of doing business in the country. There should be strict observance of time and other business ethics in the country. Meeting should be scheduled on time and one should attend them on time too. As a business leader, one should respect the diversity of the culture and their business practices. Reference: Christopher, A. (2000). Atlas of Changing South Africa Hein, D. (2002). Doing business in South Africa. A south African culture Review. Kalley, J. (1999). South African under apartheid. University of Natal Thompson, L. (2001). A history of South Africa. University of Yale Welsh, F. (1999). South Africa: A narrative history. Kodansha America William, B. (2004). Twentieth-Century South Africa. New York: Oxford University Press Read More