192: Macdonald Takundwa

I’ve always wanted to be an entrepreneurial person’

Welcome to the CFO Club Africa podcast, where we interview leading CFOs from Africa and beyond. CFO Club Africa is a division of the Chartered Institute of Business Accountants, the professional body for business accountants, financial managers and chief financial officers. Go to www.cfoclub.co.za and join our community of accounting and finance executives.

Welcome to this CFO Club Africa podcast, in this podcast series I speak to leading financial professionals and CFOs about their professional journeys, their perspectives on the industry and their perceptions regarding the skills modern financial professionals must have to lead a successful organisation.

My guest today is Macdonald Takundwa, he is a Chartered Management Accountant, and he also has an MBA. He recently started his own business, and it consists of two very diverse divisions. The first is a consultancy, which offers bookkeeping, financial and accounting services to small and medium-size businesses and the second division is a logistics business, basically a trucking firm. Before founding his own business, he was the CFO of Higher Health South Africa, it is an organisation which works in several areas to promote the health and wellbeing of students across South African tertiary educational institutions.

He was worked over the years in the commercial, developmental and non-governmental sectors, which include companies such as British American Tobacco, Natprint, PG Industries, Logwood and he also did some consultancy work at Futures Group.

Macdonald, please tell us about yourself, where did you grow up and when did you decide to become an accountant?

I am originally from Zimbabwe, I went to school in Harare and I also completed my tertiary education there. I only came to South Africa in 2009.

I always had an interest in accountants since I was in about grade ten, I watched a movie and there was this accountant, and I was really fascinated with the things that he was doing in terms of how he was making business decisions and how his input was valued in the organization. Also, his aptitude for numbers and how he’d crunch numbers and make decisions based on the analysis that he’d do.

So that’s when I decided that I’d like to pursue the field of accountancy and ever since grade ten, I had my eyes set on the goal of being an accountant.

You’ve recently taken the big step to start your own business, when did you decide to become an entrepreneur because it must have been a big decision and a difficult decision to take to leave a senior position at Higher Health South Africa to do this.

I’ve always wanted to be an entrepreneurial person, I think Astana Business Solutions is an idea that I developed while I was still working, something that I did way back in 2014, that’s when the company was established but I was not fully involved with the running of the company. Basically, it’s to assist small enterprise businesses with their accounting needs, in terms of provision of management accounting reports, providing secretarial, HR and payroll and also provide some training.

Most of the SMEs lack the fundamentals of running an organisation when it comes to the finance side, and they fail because they don’t have the knowledge and skills to manage a business.

That’s when I saw the gap to start doing this and also try to empower these SMEs so that they have got knowledge of accounting and they can effectively run their organisations.

That is a very competitive industry, there are many small accounting businesses offering those services. Do you do anything significantly differently for SMEs to pick you rather than a competitor?

You are right in saying that there are so many players in the industry but there are also so many clients in that industry. The different accounting firms will not be able to cater for the number of SMEs that we’ve got. One of the reasons why I entered that space was because I had a few clients who had asked me to start running my own enterprise because of the experience that I had and also because of the prices we were offering.

The traditional accounting firms have got tailormade pricing or packages that they offer to the clients. I had a different approach to say this is the basket [of services] that we’ve got, and you can tick the services that you want offered to you. So to offer a competitive advantage and instead of saying I’m going to be doing A to Z for this amount, we can then make up a basket of what you want.

You also have a trucking business, Astana Logistics, it seems like it’s a world apart from financial services. Why did you choose to have such a diverse business as part of the Astana Group?

I saw an opportunity in the trucking business, I’m sure that everyone is aware that lately the transportation industry has been heavily affected due to Transnet not being able to run effectively in terms of its deliveries. There is bulk transportation of commodities, different areas, mostly to the ports for loading for export. There are a number of truckers that are onboard already, big and small companies running trucking businesses.

My business is mostly the transportation of bulk materials, minerals and agricultural commodities because there’s a massive gap that was left by Transnet and the infrastructure has been destroyed.

We don’t have goods trains running to the different ports of entry. I saw an opportunity and I entered that industry, but I must say that it is quite a challenging industry, you have to know the ins and outs of the industry. It’s been an eye-opener for me, and it was a completely new challenge, but I think I have learnt the ins and outs of the industry and I am still learning. But in terms of the returns on what I have put into the business, it has been very satisfactory.

Let’s talk about Higher Health, you were there for a few years, it’s an NGO, which I imagine would be worlds apart from a private sector business because Higher Health is linked to the Department of Higher Education and Training and most of the funding came from this department, and now suddenly you need sales to make ends meet. I think the role of a CFO is totally different from an NGO relative to a private sector business. Tell us about that change, how much did your role as the financial head of an organisation change, especially now that you are also the head of Astana, how did the challenges change?

When you are the head of finance for an organisation, especially an NGO, you don’t have to have headaches about sales. Mostly you just do your funding proposal, pitch it to donors and then you’ll get funding. As long as there’s value for money because donors always want to see value for money, and also because 70% of the funding was from a government entity, we didn’t have many challenges in terms of cash flow.

Also, in an environment like that there are standard processes and procedures that are already set, that you have to follow. So you’re more of a record keeper, you’re mostly worried about reporting, with treasury management you have to do that. There are also compliance issues that you need to maintain, so you don’t go over and above what your role asks you to do. Whereas when you’re running your own business, especially when you’re small, you’re the CFO, you’re the CEO and maybe you’re also the sales director. So you’re wearing one hat but you have to go over and above number crunching.

Let’s talk about your role as CFO at various organisations and companies, what do you regard as the most important skills a CFO must have to be really good at what they do?

I think the role of the CFO is changing. As I mentioned before, it used to be all about numbers, providing oversight on financials and reporting, and to a certain extent, risk management. But now the CFOs today have to be more adaptive, they have to exhibit leadership skills, instead of a role as being a controller, you need to be a business partner. You have to show communication skills and you have to cut across all functions or departments to have a clear understanding of the organisational needs.

To a certain extent you have to be an influencer, you have to influence those who you are working with to make sure that they understand the organisation and whatever it is that they do, they do it in line with what the company intends to achieve.

A CFO also has to be operational, meaning that they need to be cross-functional experts, not only being a finance person who sits behind a computer and crunches numbers, but they have to understand the system, if it’s a production system, to a certain extent, before you write that signature you have to understand why you are signing off that document for payment. They also need the ability to analyse data and there is also the stakeholder value that they need to maintain, and this is mostly achieved by making sure that there’s profitability analysis, improvement, cost controls and minimising risk.

You also did an MBA; how important do you think an MBA qualification is to assist you to also do these other things that you’ve just mentioned?

The MBA gives you those skills that you don’t normally acquire when you’re doing your accounting, it gives you an overall picture of being a visionary, providing oversight, not only for your department but for the whole organisation. It helps you in terms of strategic formulation and development, you have to understand all the facets of the organisation, whether it’s HR, IT, sales, production, logistics, you have to understand how it all interlinks with the other departments. Also, when it comes to strategy, you have to be able to develop not only short-term plans but long-term strategic plans. An MBA gives you those skills to do strategic formulation and also to provide leadership.

CFO Club Africa is affiliated with associations of finance executives in France, Germany, Italy, Spain, Portugal, Greece, Mexico, Morocco, Tunisia and Namibia, and annually hosts an international CFO summit. You have done the work and achieved the CFO title, now join the CFO Club Africa as a finance executive.

Ryk van Niekerk is an award-winning financial journalist with over 20 years' experience. He is Moneyweb’s editor and hosts the Market Commentator podcast and RSG Geldsake, covering the markets, and financial and investment content, joined by CEOs, entrepreneurs, policymakers and others.

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