Decentralised stakeholder engagement

Given Bidvest’s decentralised, multifaceted and geographically diverse operations, centrally conducted stakeholder engagement is usually impractical. Some businesses do not have structured stakeholder engagement systems in place while others have implemented highly sophisticated systems.

Divisions and business units identify and engage stakeholders material to their businesses. Reviews in the online divisional sustainability reports provide evidence of broad engagement with a diverse spectrum of stakeholders.

Customer engagement

At industry level, Bidvest divisions engage with industry bodies and regulators, often serving on bodies to advance the long-term interests of their industries. Some companies subscribe to Hellopeter.com, a South African portal for customer complaints. These channels help companies identify areas for improvement and provide marketplace feedback.

South Africa’s National Credit Act ensures potential customers have sufficient financial means. This is of particular relevance to Bid Auto. This year, the Consumer Protection Act was signed into South African law and comes into full effect during 2010. The key business impact of this legislation is to increase transactional costs, giving consumers the right to reject a purchase within a defined period. Bidvest companies are conducting workshops with customer-facing staff to ensure the Act’s provisions are met in full.

Customer relationship management is driven at divisional and business unit level. Some businesses have no structured systems in place, while others such as McCarthy at Bid Auto have implemented highly sophisticated real-time systems. (Click here to view the Bid Auto sustainability report.)

For three years, 3663 in the UK has run an annual customer survey. (Click here to view the Bidvest Europe sustainability report.) A web-based survey system is being trialled. A more detailed qualitative survey is run every second year for current, lapsed and potential customers.

At Group level, some customer assessments may be undertaken as part of Bidvest Academy assignments. (For more detail on The Bidvest Academy please click here.)These assessments are, however, not comparable or representative as specifically underperforming areas are reviewed. However, in some cases these provide an indication of customer loyalty at divisional and Group level.

Bidvest divisions operate in many sectors and utilise varying approaches when integrating customer feedback, ranging from high-tech 24/7 systems to ongoing face-to-face customer interactions. Some businesses have dedicated staff or departments; in others the integration of customer feedback is management’s responsibility. McCarthy has the Group’s most comprehensive real-time customer satisfaction and feedback system. In businesses with small numbers of large clients or contracts, such as Bidpaper Plus and Prestige Cleaning Services, each client is typically assigned to a key account manager.

The business-to-consumer environment
Significant Bidvest businesses have rigorous service quality standards in place. For example, McCarthy dealerships have a customer satisfaction index for both new and used-vehicle owners. (Click here to view the Bid Auto divisional sustainability report.)

Similar attention to customer needs is applied in Bidvest’s food businesses (Bidvest Europe, Bidvest Asia Pacific and Bidfood) to ensure that strict food quality, health and service standards are met. Some Bidfreight businesses have to meet strict customer requirements, and incur penalties should failures occur. Bidvest invests heavily in quality and customer relationship systems to ensure it retains competitive advantage.

The business-to-business environment
At Bidfreight, superior customer service is critical. Management and dedicated business development and customer services personnel liaise directly with customers to determine satisfaction levels. Issues are addressed with the relevant management team and prompt attempts made to resolve problems to the customer’s satisfaction. Steps taken at Rennies Distribution Services and Safcor Panalpina illustrate the approach. (Click here to view the Bidfreight divisional sustainability report.)

These methods are not universally adopted by Bidfreight companies. Formal methods of logging customer feedback and company responses still need to be developed at some businesses.

Engagement with employees and trades unions

Bidvest is a significant employer whose activities affect the lives of workers, their families and communities. Of the
103 449 people employed in all, 86 678 work in South Africa. Of these, 87,5% are HDIs.

Engagement with unions and employment equity forums
Bidvest and operational companies engage with employees through numerous channels. Employee representation through trades unions stands at 3,5% internationally and at 28,2% in South Africa. Union representation varies. Around 95% of the workforce at Bidfood Ingredients has collective representation. (Click here to view the Bidfood divisional sustainability report.) Bidpaper Plus has similar relationships with its unions, enabling positive engagement when redeploying staff following Cape rationalisation. Most Caterplus employees are union-represented, but negotiate independently with the 29 business units.

Most Bidserv employees are represented by the National Contract Cleaners Association (NCCA). The company’s policy is to ensure good employee relationships and the business offers market-related remuneration. Bidserv often sets the industry standard and helps the Department of Labour to apply minimum wage standards elsewhere in the industry. The company plays a strong advocacy role, encouraging engagement with the NCCA on issues of common concern.

In South Africa, divisions make effective use of employment equity forums, enabling issues to be dealt with on site. Committees meet quarterly, minutes are taken and agenda items followed up. All affected stakeholders are kept informed.

Governance and the regulatory framework
Responsibility for union negotiations lies with human resource management and managing directors at divisional and business unit level. Codes, policies and procedures guide recruitment, business conduct, non-discrimination, industrial relations, employment equity, grievance and dispute settlement, HIV/Aids and other life-threatening diseases, employee conduct, freedom of association, ethics and sexual harassment. Policies and procedures are communicated to staff through orientation workshops, notice boards and employment agreements at company level.

Management of important employee issues
As many workers are experiencing financial difficulties, many Bidvest companies run life skills programmes to help employees draw up household budgets and engage in responsible financial management. Debt counselling is also available.

At Bidpaper Plus, lost productivity as a result of absenteeism is a concern, as is the lost opportunity cost when expensive equipment stands idle. The company monitors man-hours available against actual man-hours. Some businesses run incentive programmes to discourage abuse of sick-leave.

One of the strengths of Bidvest’s decentralised model is the personal attention given to employees at company level. Proof of the value of employee engagement is especially apparent in an economic downturn. Bidvest’s resignation rate is down from 18,5% to 17,1%, absenteeism is down from 2,5% to 2,2%, though CCMA disputes have nearly doubled from a low base.

Two divisions hit particularly hard by recession are Bidvest Europe (specifically 3663) and Bid Auto (McCarthy).

McCarthy
With the closure of 28 branches in the dealership network, McCarthy’s headcount fell by 15%. The company took prompt action. The leadership engaged personally and transparently with staff. The results of this proactive approach have been significant. (Click here to view the Bid Auto divisional sustainability report.)

3663
Companies within Bidvest Europe attract and retain talented and motivated employees who share the company’s values. These values have been tested during the economic downturn, especially at 3663, where more than 500 people lost their jobs. (Click here to view the Bidvest Europe divisional sustainability report.)