5 - The Capabilities of South African Multinational Enterprises in Wider Africa

Summary

South Africa is arguably the leading African economy, and its multinational corporations are increasingly expanding into wider Africa. We examine firms from the financial services sector (Standard Bank and Nedbank) and from agro-processing (Tiger Brands and Clover). We complement archival research with interviews with executives in South Africa and subsidiaries across the continent. A core capability was business acumen – both foundational and evolving. Firms seemed to struggle with novel, underdeveloped host contexts and it was important to remember “business basics,” given that the world in which they were doing business was evolving and the “basics” of business were changing fast. The other key capabilities both had to do with embedding. Multinationals did well when they were able to ensure embedding not only between the parent and the subsidiary, but especially between subsidiaries (which often faced similar challenges). Local embedding in the host country was critical, whether it involved regulators, suppliers, or customers.