To better understand the impact of our approach to B-BBEE and Skills Development, we present a basic case study.
Our Case Study is based on a company classified as a generic measured entity under the Amended B-BBEE Codes.
The company has a payroll of R10 million and a skills budget of R600 000. Within the company, there are 100 employees and out of those, 70 are black males and 10 are black females. There are no employees with disabilities employed. The company is considering two options for skills development.
Option 1: Short Skills Programmes
This Option is based on a training plan for an amount of R200 000 for several programmes and training courses requiring attendance ranging from 1 day to two weeks. In total 30 black male and four black female staff members would be trained.
This approach resulted in a total score of 2.67 points out of a possible 25.
The effective net cost of each point gained was R75 000.
Option 2: Our Solution
This Option is based on the ProudAfrique approach to skills development.
Two employees, one black male and one black female that are excelling in the company were selected for management training. Both have a current cost to company of R150 000 per annum. A General Management learnership is selected.
The company also agrees to sponsor one disabled and unemployed black female. She will be joining our Career Activation Programme in order to be able to find a meaningful job thereafter. She will also be paid R2100 stipend per month during the programme.
The company further approves an additional four bursaries valued at R10 000 each.
This approach results in a score of 22 points out of the available 25.
The effective net cost of each point gained was less than R6000.
It is obvious that Option 2 is a far better and a more cost-effective approach, not only for skills development but also in terms of career development of people in the company. With proper planning the resultant B-BBEE scorecard benefits can be greatly improved.
By adding an approach that spans several years and including the benefit of Tax rebates and SETA grants for approved learnerships, the scale tips even further.