HomeBusiness DigestBiti’s ministry violates law of navigation

Biti’s ministry violates law of navigation

ZIMBABWE’S Finance ministry set today (October 1) as the date by which all relevant businesses should have installed fiscal register devices.

For the government, this strategy is designed to increase Vat collection and makes evasion very difficult. With a “we eat what we kill” budgetary regime, a term coined by minister Biti, the programme is expected to “kill more prey”. Allow me to stretch the minister’s metaphor a little. The fiscal registers will undoubtedly increase the number of “traps” that will catch more prey and hopefully increase what “we eat”.

The problem is the ministry wants business to buy the “traps” that will “catch them”. To sweeten the deal, the ministry has given its word that it will reimburse half of the price of buying the “traps”. Disquiet within the business fraternity is quite thick. Business is bewailing the price of the fiscal register devices which are reported to be in the region of US$2 000 per unit, four  times what is charged in some countries.
I see a serious failure of leadership surrounding this noble programme largely explained by Maxwell’s law of navigation.

Upon completing my post-graduate studies in business and, getting a very senior managerial position I had a rude awakening. I learnt my lesson early on the importance of the leadership law of navigation. At my new job, the first thing that got my attention is how a simple programme would be painstakingly planned. In organising events, the minutest of details such as who should speak before whom, what the most appropriate sitting arrangement would be were big issues. Every minute of the programme was meticulously planned. Second, I noticed that in planning meetings it was not the highly educated whose suggestions would attract nods in near choreography style. There my deep interest in leadership was kindled. Frankly speaking, very few business schools teach leadership and what passes around as leadership is nothing more than good old management. My first serious read on leadership was John Maxwell’s 21 irrefutable laws of leadership. John is a master communicator. He tells a story first and then his point. In Maxwell’s leadership Bible, he says something profound. Of communicators, he says they take something complex and make it simple, while educators take something simple and make it complex. That caught my attention.

His opening story, when teaching the law of navigation is stuck to this day. On the eve of World War I, two men set out to compete to be the first humans in recorded history to reach the Antarctica. Roald Amundsen from Norway and Captain Robert Scott from Britain led rival teams. Scott and his men reached the Antarctica several months after Amundsen and his men had hoisted the Norwegian flag there! Scott and his men could not make the return journey. They perished. Serious frost bites, intense dehydration, severe starvation and scurvy took their toll. Perhaps the saddest thing is that this was a man made disaster. Sounds familiar?

So what happened?
Scott took for beasts of burden, horses, not adapted to the biting Antarctica’s cold. The horses barely made it past the edge of the Antarctica. With burden-bearers dead, Scott’s men took the extra baggage. Scott did not bring enough fuel to melt the frozen Antarctica water for drinking. His rest camps were too far spaced, forcing dehydrated men to trudge longer. Worse still, Scott’s men did not have the right clothes to keep them warm. They had ordinary shoes instead of special boots to keep their feet warm in the unrelenting Antarctica’s freeze.

Just about everything Scott did wrong, his nemesis Amundsen did right. Amundsen spent a great deal of time thinking about the expedition. He carefully studied how eskimos managed their logistics. He quickly learnt that they used dogs adapted to Antarctica to pull specially designed sledges. He adapted their ways.

Though not as naïve as Captain Scott, the ministry’s handling of the fiscal registers programme is still a significant violation of the law of navigation. Maxwell offers an antidote through his navigation formula: PLAN AHEAD. P stands for predetermine your course of action; L for lay down your goals; A for adjust your priorities; N for notify key people; A for allow time for acceptance; H for head into action; E for expect problems; A for always point to successes and D for daily review your plan. It would appear as though the ministry failed at the first six steps.

First, I do not think the process of predetermining the course of action was done as rigorously as would have been necessary. For starters, the fiscal register devices are not locally manufactured. It takes between six to eight weeks to get the devices following one’s placing an order. The question is: why are suppliers not ordering the devices in bulk? It is possible that the suppliers are being prudent to avoid finding themselves with  “mountains” of unsold devices. Why is the ministry not buying the devices in bulk to leverage on economies of scale, lowering the price charged to businesses?

One would have thought that with the ministry purchasing, the costs of importation would be much lower owing to concessionary or even zero import taxes. We would then expect the ministry to sell these at reasonable prices just to cover its procurement costs. We would not expect the ministry to make a killing from the sale of these devices. Was this a difficult choice to make?

Second, still on predetermining the course of action step: what provisions were made to test these devices for compatibility? One would have thought that these devices would have been pilot-tested first before scaling up. Why the impetuous lunge into a full scale implementation before testing for adaptation to local contexts? Pilot-testing could avoid  “taking horses to the Antarctica” like Captain Scott.

Third, the L (lay down your goals) also leaves a lot to be desired in as far as the timeframe for compliance is concerned. Having not sufficiently navigated the supply chain for capacity, efficiency, pricing as well as pre-testing, October 1 as the compliance date was rather unrealistic.
Fourth, the N (notify key stakeholders) appears not to have been effectively done. Notifying in this model does not equate announcing but means engaging. Surely, had the ministry engaged business as a major stakeholder the questions I have raised and others would in all probability have been raised.

Fifth, the A (allow time for acceptance) was inadequate. Like in many projects this A is almost always ignored. Many jump into the H(head into action) before the A. Allowing time for acceptance creates space to answer questions those affected by the project may have.  I am aware of the 20-60-20 rule which states that 20% of the people will resist change, 20% are already doing what the change requires while 60% want to change but do not know how. I think many businesses are in this latter category and they need time to source funds and implement. Maxwell would say it is not the size of the project that matters but the size of leadership. Would you disagree?
Share ideas at brettchulu@consultant.com.

By Brett Chulu

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