Graham Briggs is probably the most senior mining leader in South Africa, having been the CEO of Harmony Gold for just over five years. It is very timeous for Harmony Gold to have an experienced leader at the helm during these tumultuous and explosive times on the SA mining ‘field’, which Ellis Mnyandu Editor of this paper recently described to me as “definitely not for sissies”.
Over four years ago I interviewed Briggs for the first time. The person that sat in front of me last week is understandably a different man – experienced, confident and courageous.
For some time now the mining industry has been fraught with challenges, which seemed to come to a head, but was in reality merely exponentially compounded by the Marikana incident. The dynamics that gave rise to this sad chapter in our history continues to play itself out in the form of a major tussle or power struggle between different societal stakeholders as they seek to make their aspirations heard. This confrontation may soon reach a pivotal point, in a year where wage negotiations in the mining sector also stare us in the face. It is as though all players have reached a stage where they feel urgency and possess the confidence to flex their muscles; to insist on raising their views, whether in acceptable or unacceptable ways, and stand by their rights – from government to labour to mining leaders to employees that unite in solidarity. We have come to a crossroads, perhaps not only in mining but also in South Africa, confirmed by current anarchy around Sasolburg. All parties must either decide to stop their polarised momentum and endure in mature conversation until they unite on the same path forward, as our national legacy demonstrates when political leaders did it in the early nineties, or there will be a major explosion, as seen in Zamdela Sasolburg, which results in severe damage where the direction is then forced or manipulated by the least injured or strongest stakeholder. Such an outcome merely postpones the most effective and necessary long term solution.
It is against this backdrop that Briggs and his management team faced the difficult decision on what to do about the persistent dissonance at Kusasalethu mine, one of the largest operations in its stable and the only one that was really influenced by the Marikana spill over. The fact that Harmony Gold was probably least affected, compared to other large mining houses, was in my opinion also a reflection and result of many years of hard work to strengthen Harmony culture and leadership confidence on several levels.
In consultation with Harmony employees five corporate values were chosen – safety, accountability, achievement, connected and honesty. The decision to close down Kusasalethu mine seems to be a conscious or subconscious attempt to live these values, especially when one considers the demands placed on the negotiation table by Harmony Gold. In essence, according to Briggs these are: “We have to follow the rule of the law; we have to be safe – we have to follow those rules and regulations for safety. This is our demand; you can only come back to work when you’ve satisfied our demands. We also demand to have normal production so that we can actually make money and the business can survive.” These simple demands clearly reflect all five values.
Their decision to ‘halt momentum and engage in mature conversation’ has unearthed an interesting situation where roles are reversed. Usually workers or unions on their behalf, place demands on the table. This is now a different ball game where – fairly so – the employer places demands on the table. Why not? It may be time for employers to level the current socio-economic power imbalance that has of late leaned towards politicians, labour organisations and even employees in some cases. There must be a balance of power if we are going to move forward as a society at large.
As mentioned earlier, it seems Harmony Gold simply wants to live their values, and in this instance, interestingly so stakeholders include unions. Collectively there is unity amongst these stakeholders to support the values, which is probably why the Kusasalethu incident has not spread to Harmony’s other operations. To take a stand with a small operation that contributes minimally towards the coffers would be one thing. But, to do so with such a large operation that started generating cash for the first time in 2011, ten years after its acquisition, takes pure courage. This demonstration in courage could potentially influence stakeholder relationships and dynamics across the entire mining industry and even across all industries in South Africa. As Briggs explains: “Yes, it is a bold step to make, it’s difficult, it’s a profitable business – this is the problem that leadership gets caught into – because it is profitable and because it’s a big asset, one of the core asset’s, you’re not prepared to stand your stand and you have to do this.”
Briggs is one of those consistent leaders; a man that just keeps on coming back, doing the simple things that eventually cements a clear message to all employees. For example, over the last five years he has consistently visited Harmony operations, been on the ground, and in many instances spent quality time there – in good and in bad times. There are clear messages in this relentless yet simple action. Firstly, employees and what they do is always important – in good and in bad times; secondly, it is crucial for a leader in a top position to form a more accurate impression of what is really going on. As Briggs states: “As the CEO, all the information that you get in your office is filtered, in some way or another, maybe some people do it to protect you, maybe some people filter it deliberately because they want to have the decision – but it gets filtered, so therefore if you get out there into the operation then suddenly everyone is exposed.” And he makes it clear to leaders that they will be exposed.
He further believes what he, and by implication his team have done successfully, is to decide on something and then do it. He says: “We don’t have idle threats out there of maybe we should do this, maybe we should do that – we evaluate something and then say okay let’s do it and then sticking to our guns we just do it. It obviously means that you need a good background or database but not waiting too long to just do it. We are decisive about making those decisions.”
All these points are rather positive, but why then does none of this reflect in their share price? Why does it persist on remaining so low? Great leaders are measured by the successful movement they create and when an organisation is a listed entity the share price is one of the important indicators. Briggs explains as follows: “I think there are at least three main issues. Not achieving our plan certainly has affected us. And you know, the company required quite a massive turnaround. We’re only recently in a position to say this is our plan, and say that’s the plan we can achieve. The other issue potentially is South Africa that has gone through many issues – political, nationalization talk, charter talk, black empowerment pressure. We are very South African as a company. We’ve got 95% of our gold coming out of South Africa, 95% of our people in South Africa, so we’re very South African and things that happen here affect us greatly. We also have a slightly different investment strategy, what we do with our profits – R1 out of every R 4 a share profit is paid to shareholders while the other R 3 is invested in Papa New Guinea. Investment climates change and so right now there’s more desire from investors to have returns as opposed to looking at growth and long life”.
In further discussions with Briggs it seems Harmony Gold has an interesting leadership dilemma in being so South African. Collectively its management may have to undergo a small yet crucial mind shift, from seeing as a ‘negative’ or hindrance the fact that they are predominantly a South African company with most of their operations here, to proactively adopting an attitude of pride in being a proudly South African company; emphasising their commitment to this fact by even assertively expanding here. This does not necessarily mean they should halt international developments…or should they?
Whether they commit fully to overseas expansion while potentially divesting local operations, or they commit to being a predominantly proudly South African or Africa company, it is difficult to serve two masters, which principle seems to counter another one of “don’t put all your eggs in one basket”. But the truth is that once they truly unite on being proudly local – in whichever way – creativity will probably be unleashed and positive opportunities will manifest because the attitudinal blockage of seeing this as negative will have been removed. In some instances it is possible to turn ones greatest potential threat into ones greatest opportunity.
Without necessarily realising it, Harmony Gold has developed and invested heavily in a formula for successfully running gold operations in SA. In many instances they have taken operations that were destined for failure and turned these into highly profitable entities. At the same time they have engrained into their corporate DNA a leadership culture with leaders that possess the abilities and qualities to create movement in what is a very challenging environment. They have a blue print for successful leadership in the Gold industry in South Africa, but do they fully realise this?
Fortunately for Harmony Gold, Briggs has extended his contract for a couple of years. This will buy them time to consciously entrench their unique and powerful culture, built around a clear strategy that hopefully embraces their South Africanism even more.
Q&A: Questions from other people…
BRLP: I feel a difference in you. I sense more confidence. How can a CEO gain more confidence?
GB: Being prepared, hey, being prepared. Part of what a person like you has taught me is you need to spend a bit of time thinking about these things, thinking about the strategic things, things you don’t normally put into that role; even being prepared for that disaster. I think the only thing you can’t prepare easily for is the conversations with some individuals, you can do some background preparation on the person but the personalities then kick in.
BRLP: If you could, what would you change about the life you’ve lived thus far?
GB: There are no regrets about what I’ve done and how I’ve done it – no, I don’t think so.
BRLP: What do you think the gold mines could do to take the SA economy forward?
GB: The SA mining companies and maybe the Chief Executives have been in a difficult spot this last while because we’ve gone through various issues where we’ve been beaten up by different people. If every time you stick your head out the door you get hit by a baseball bat, well you stop putting your head out the door. So I think generally SA’s chief executives in the gold mining industry, withdrew a little bit and weren’t as outspoken as they were before and they should have been, rather. And you know, if you’re in the position where you are the leader of 20 or 30 or 40 thousand people you should have a view and make it known, and not only a personal view, but a company view. So in some ways this is probably an area where we haven’t done justice to things – we should be out there, we should influence and mold and assist to grow South Africa or to make South Africa better. We’ve got major potential to do it. You need the right facilitator, you need government to do the right things, and if the government is not doing what they should be doing, we should be challenging them.
BRLP: What is your outlook for the gold sector this year and why?
GB: It’s going to be a difficult year. It started off badly from the perspective that we’re actually going to take a stance and there are consequences to that, but I’m hopeful that sense prevails and that in whatever happens, the gold sector can be a little bit of an example to other sectors. It’s going to be a difficult year – Goldfields is doing its split up, Harmony is taking a stance, not sure what’s going to happen in Anglogold Ashanti. At the end of the year, things could be looking a little different to what they look like now. So we’ll look back at 2013 and go “Wow that was different”. And hopefully we’re better for it by the end of the year. This is for the better – this is not just change for change’s sake.
BRLP: What have you learned about leadership in the last 5 years?
GB: Keep listening to people, not just hear them, but listen to what they’re trying to say and does that mean they influence you – yes, it does mean they influence you a bit. A lot of people can give you good advice. Again, as a CEO, you don’t know everything; a lot of people have told me that. Sometimes, you think, heck, I’ve got this issue and you go to the financial director and say how do I solve this and the nice lesson there is that he may say I don’t really know but I do know somebody who can help us solve this problem and you just keep on building up knowledge and information and you know who to ask and how to ask and how to get around it. It’s all about people.
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