What an amazing experience it was to sit next to Clem Sunter at the 5th anniversary of the Thursday Club lunch at Buitenverwachting yesterday, the guest of the wine estate’s PR consultant Sandy Bailey. At the lunch Sunter’s new book ‘21st Century Megatrends: perspectives from a Fox‘ was launched. Sunter was the first speaker at the Thursday Club at its launch five years ago.
We were welcomed with a choice of a glass of Buitenverwachting Blanc de Noir or Meifort (a blend of Cabernet Franc, Petit Verdot, Merlot, and Cabernet Sauvignon). Sunter was already in the restaurant, and was happy to pose for a photograph, volunteering to move away from the glass door so that the light did not affect the photograph, clearly an old hand at this. We started chatting before the lunch started, and I received a quick overview of his talk, and learnt a lot more about him.
Christopher Sunter was born in the UK, the only son of a mother he was very close to, and went to school at Winchester College. At school Sunter played the guitar, and the first song he sang was ‘Oh my Darling Clementine‘, which led to his classmates calling him ‘Clem‘ after the song, and the name stuck. He went to Oxford, and there he started a band with his friend, called the Clem & John Band. His biggest claim to fame is the fact that the band co-headed a concert in Oxford at which the Rolling Stones performed as well, in June 1964, and he ended off his talk with this information. We were lucky to have Clem sing for us at the table, his face lighting up as he did so. He shared that he performed with eleven other CEOs at a concert at The Barnyard in Johannesburg last year, organised by Reg Lascaris, the proceeds going to charity. He sang ‘Peggy Sue‘ and ‘Blue Suede Shoes‘ at the concert, and ‘Peggy Sue‘ for us at the table too. Should his career as a scenario planner ever fail, which is highly unlikely, he can fall back into a career as singer! Sunter also is very funny, saying that every year for three weeks he lived in the home in which his mother lived before she passed away. Every evening they were served a glass of wine, and he told a funny story about the residents of the home which brought the house down as he started his talk. Sunter joined Anglo in London after university, and moved to Anglo Zambia in 1971, and then to Anglo South Africa two years later, serving as a Non-Executive Director of the company now, as well as consulting to corporates around the world as a scenario planner, and writing books. Sunter has owned a holiday house in Simonstown for a number of years already, and he and his wife plan to move to Cape Town next year, a ‘semi-gration trend’, he said. They live in Rosebank in Johannesburg and he said that he loves living in Africa, and feels completely at home in this country. Two of his three children live outside South Africa, one of them in Perth, which caused a laugh as I had asked him whether we need to pack for Perth again, which he now refers to ‘parched Perth’ due to the impact of climate change on Australia.
Sunter first became known in the ‘Eighties with his ‘High Road Low Road’ scenarios, when South Africa was at a cross-road politically. The talks reached 25000 people within three months at the time, and ‘changed the conversation‘ about our future, he said. He reached the former National Party government, speaking to the Cabinet, and then addressing each government department thereafter. He says that we have reached our second cross-road now, but it is economical. He explained scenario planning as looking at possible futures, now adding percentage likelihoods to his scenario alternatives, which I do not recall from his past talks. He also said that as scenario planning may come across as too intellectual, they are now using ‘flags‘ as indicators of the future, and admitted that they are subjective, and that they welcome feedback and even disagreement. Sunter has used the ‘fox‘ analogy to describe how companies should react to change – a fox looks outward and acts inward, adapting its strategy. He shared that their book sold best in 2002, after Sunter had written to President George Bush, advising him to respond like a fox to a massive terrorist strike he had identified for America. 9/11 happened soon thereafter! Sunter warned that in scenario planning one needs to go to ‘first principles’, and that ‘there are no sacred cows that cannot be questioned‘. Sunter looks about five years ahead for his scenarios.
Sunter sees three flags at a world level:
1. ‘Back to the USSR‘ – there is no doubt that there will be a return to the old Soviet Union under President Putin. Europe is not evaluating the threat thereof enough, and Germany is most at risk, given that Russia is its largest export market. We are moving back to a Cold War. Only the USA can challenge Russia. Russia has a bomb strong enough to wipe out London or New York.
2. Climate change – extreme weather events, with worst ever Twisters arriving earlier than normal in the USA last year, the worst drought in 160 years in California, the worst rains in 200 years in the UK last year, and Berlin’s temperature at 35 – 40° C currently being 10°C higher for this time of the year ever recorded, were mentioned by Sunter.
3. Aging of the world population – a hundred years ago the average lifespan was 40 years, and now it has doubled to 83 years. The Baby Boomers are now the ‘Geriatric Boomers‘.
He has two scenarios for 2020:
1. ‘Hard times’, a scenario with a 60% likelihood: flat, low economic growth, due to Japan’s economic growth not having recovered since the recession, it has an aging population, it does not allow immigration; the UK is ‘an old age home‘; Italy has a negative population growth – all countries at 0 – 1 % growth. The USA still has a growing economy with a large proportion of 35 – 45 year olds, giving it 2 – 3% growth. Sunter said that in this scenario companies need to create new products reaching new markets every year. They must ‘live their brand‘, to become superior to one’s competitors via ‘Rules of Engagement‘. He quoted Sainsbury’s as the leading UK retailer now, surpassing Tesco and Marks & Spencer, and McDonalds, which focuses on speed of service and cleanliness better than its competitors. Alternatively, one must be cheaper than the competition, to meet the needs of the middle class which is suffering badly. Sunter told us how the UK middle class cannot survive financially between the 21st and the last day of the month, living off baked beans, not going out, leading retailers to reduce their staff on the last ten days of the month! In winter older British persons can be found on buses all day, to keep warm during the day, as they cannot afford the heating during the day. By contrast the Super Rich are super rich again.
2. ‘Ultra violet‘, a scenario with a 40% probability: Africa is becoming highly attractive, having the youngest population and the fastest growth, even if off a low base. L’Oreal is making Africa its target market, formulating new skin and hair care products for our continent. A lot depends on what happens to China’s economy, which will feel the effect of its one child policy and competition from Vietnam. Countries and businesses supplying China should still benefit.
South Africa’s future
Sunter used a soccer analogy to paint three scenarios for our country’s future:
1. ‘Premier League‘ (50% probability): South Africa’s world competitiveness would have to improve to the mid-thirties from its current 52nd out of 59 places in the Global Competitiveness Report, labour unrest being the major cause of our poor ranking.
2. ‘Second League‘: (25% probability) : we can stay as we are, being ‘poor but peaceful’!
3. ‘Failed State’: (25% probability) : this scenario had a zero probability until the Marikana miners’ strike and police reaction occurred. Currently we are experiencing the largest mining strike ever, and no one is doing anything about it!
To improve our country, we need inclusive leadership, the late President Mandela being such a leader. He involved business, as did former President Mbeki. President Zuma is not involving business. Sunter spoke about ‘pockets of excellence’, highlighting what talent we had lost in former Pretoria Boys High learner Elon Musk, now America’s best entrepreneur, who founded Paypal, the best electric car in the world, a space ferry, and a high speed link between Los Angeles and San Fransisco. We should not scare such entrepreneurs in leaving our country. Entrepreneurism is an important way for our country to grow, and to employ more workers, entrepreneurs being our country’s ‘fortune‘, Sunter said. Red tape must be reduced and labour legislation addressed to encourage more entrepreneurs to start their own businesses. Sunter was critical of hand-outs and said that government grants lead to mediocrity. He answered questions relating to Somalian and Chinese entrepreneurs in our country, and Zimbabwean and Malawian workers more likely to be employed than local staff.
In closing, Sunter said that they have not yet been invited to do scenario planning with the ANC government. An economic CODESA is needed, with government and business planning the economic way forward for our country. Sunter and his business partner Chantell Ilbury have done 1200 scenario planning sessions around the world.
Chef Edgar Osojnik and his team prepared a lovely three course lunch, serving an Amuse Bouche of Leek-salmon terrine with smoked quail egg and salsa verde. This was served with the Buitenverwachting Blanc de Noir. Our main course was a duo of springbok and kudu fillet served with a port wine sauce, a most unusual filled Williams Croquette, and beans and beetroot, paired excellently with the Buitenverwachting Meifort.
The dessert was unusual and colourful, being a glazed rum savarin served with vanilla pineapple slices and coconut saffron ice cream, a highlight of the meal. I got a perfectly made cappuccino, and friandise were served with the coffees.
Jenny Rabinowitz, the mother of stand-up comic Nik, sat at our table too, and celebrated her birthday yesterday. She told us about her shy and introverted son whilst still at school, and who slowly gained confidence whilst telling stories around the campfire whilst he worked for Felix Unite. They lived at Eagle’s Nest in Constantia and he went to the Waldorf School, where learners were taught Xhosa from Grade 1 onwards, a subject which Nik studied at UCT too.
We had a most enjoyable and entertaining afternoon at Buitenverwachting, with Sunter being entertaining yet very serious about what our country and the world need to be better places, a lovely lunch, good wines, and great company.
Buitenverwachting, Klein Constantia Road, Cape Town. Tel (021) 794-5190. www.buitenverwachting.com Twitter: @BeyondBuiten Tuesdays – Saturday lunch and dinner. In summer open on Mondays too. Closed for a winter break from July – mid August, but its Coffee Bloc stays open in this time.
Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: @WhaleCottage