Business evolution

On my way back from the Zimplow analyst briefing yesterday something crossed my mind and I shared it with a colleague. “African farmers will not use hoes and ox-drawn ploughs. 10 years from now farmers could be tilling the land using better, cheaper and easier technology.” What is profound about this is that it is so true and somewhat frightening. We already use tractors don't we? Somewhere in Asia they even push tractors. The world is evolving very quickly, and one day we won’t be relying on these implements. It may not be next year or even in our lifetime. My question is what are Zimbabwean companies doing to ensure that they are in existence and still building shareholder value 5 or even 10 years from now.

In an earlier article (16 November 2010) I wrote about business models and I focused among other things on how businesses such as Delta were anchored on the premise that people drink beverages. That habit will probably never change at least not in our life time. You can read it here http://briefviews.blogspot.com/2010/11/business-models.html. Will Zimplow be producing the same ‘badza’ (hoe) and gejo (plough) and still find customers for it? A friend of mine shared with me a book called “ The Singularity is near written by Ray Kurzweil.” I haven’t read it myself but I saw a few excerpts that were fascinating and insightful. The little that I gleaned from this book left me with little doubt this guy was onto something not that I agree that computers should be part of our bodies etc. I agree with the fact that things are changing and one can be left behind if they are unprepared to embrace or profit from them.

All I am asking is are we preparing for the future enough? Or we are just doing what our predecessors have always done and hope that it will never change. In this week’s press there was an article that caught my attention. Scores or clothing companies have been closing down every year because of cheap imports, high labour costs etc. Yet Zimbabwe has some of the best tailors and cotton! There are several other companies in our other industries facing the same plight in Zimbabwe and are on the brink of collapse.

Do Zimbabwean companies purposefully invest in Research and Development? I love getting dividends but would rather hear a company saying that they are forgoing paying a dividend because they are investing in the new way of ensuring that profits continue growing. It will be interesting to see how companies like Zimplow evolve. Time will tell.