A secondment-based approach to inclusive business support
Advisory services have delivered significant value to African businesses since Open Capital Advisors (OCA) entered the local consulting market over seven years ago. A growing market of service providers has brought operational, financial, and technical expertise to businesses, freed up capacity for thinly stretched managers and entrepreneurs, and added an additional layer of credibility for engaging with investors and other external audiences. Since OCA’s launch in 2010, we have seen a remarkable rise in the demand for these advisory services, as African economies and international interest in African markets continue to grow.
The more businesses we support, however, the more we have realized a need for ongoing innovation in our own service model to meet ever-changing client needs. Some of our clients have very defined technical advisory requirements – a capital raise, for instance, or advice on specific business functions such as sales or distribution – but others require more flexible forms of ongoing support. Specifically, one of the most common concerns we hear from our business clients is how difficult it is to find and retain junior and middle-management talent, without which even the best laid strategic plans often fail to reach their potential.
To address this need, we have recently begun scaling a new approach to providing ongoing advisory support, in which Open Capital analysts are deployed on full-time secondments to our business clients. Each analyst “secondee” acts as a full member of the client team, reporting to client management and working on client site as if they were a direct employee. At the same time, secondees interact closely with senior Open Capital team members to draw on our full range of experience and capabilities. As a result, our business clients gain an invaluable full-time resource able to adapt to evolving needs, backed by Open Capital’s broader expertise.
This model has shown strong results and we hope it will be a model the advisory services industry can scale, since far more businesses have expressed interest than we can serve. The challenge to scale is in talent development, an area in which OCA has invested considerably over the past seven years. We build our pipeline of analysts through a highly competitive selection process from Africa’s top universities, followed by rigorous training programs modelled after leading international consultancies and investment banks. Analysts additionally receive intensive mentorship from our senior team, who in turn bring top global expertise. Our goal is to impart not only the technical tools of the trade, but also the management, teamwork, and communications soft skills that allow our analysts to quickly take on significant responsibility in key client roles.
We believe this secondment-based model will be one of the most effective methods of scaling advisory services for African SMEs, many of which cannot otherwise access or afford high-quality support. This in turn will create stronger pipelines of ‘investment-ready’ businesses, increase capital flow, and in the longer-run strengthen economies. OCA is working to scale this model, but much more needs to be done across the industry and different stakeholders, from universities, to industry associations, to investors.
This blog is a part of the June 2017 series on advisory support for inclusive businesses in partnership with USAID and the African Agricultural Fund’s Technical Assistance Facility, both of which deliver advisory support and have new analysis of it just launched (AAF’s TAF) and forthcoming (USAID).
Read the full series for more lessons from seven different providers of advisory support and stories of success from entrepreneurs.