External environment
Understanding the global trend
COVID-19 has exacerbated the issue of unequal access to health and healthcare. According to the World Health Organization, approximately half of the global population currently lacks access to essential health services, and hundreds of millions of people are pushed into extreme poverty every year due to health-related expenses1.
Workplace health is also receiving increasing focus, with as many as half of the confirmed cases of some infectious diseases originating in the workplace, driving employers to play a more proactive role in ensuring access to quality healthcare for their workers.
Against this backdrop, the private sector can play a pivotal role in broadening access to healthcare by developing innovative and relatively affordable business models.
Understanding the trend in our context
Rising healthcare costs continue to affect the affordability of medical scheme cover for millions of South Africans. As unemployment levels mount due to weakening economic conditions, quality healthcare has become increasingly inaccessible for most of the population. Furthermore, the pandemic has heightened mental health issues, leaving many more vulnerable in the face of adversity.
The Competition Commission’s Health Market Inquiry identified many issues that increase healthcare costs and impact the market forces within the private healthcare sector.
The NHI Bill has come about to address universal access to healthcare in our country. To support this aim, the bill paves the way for establishing an NHI Fund, which will purchase services from accredited public and private healthcare providers.
Responding strategically
AfroCentric exists to enhance the quality of life for our stakeholders. We seek to achieve this aim through targeted actions to transform healthcare delivery. AfroCentric is positioning itself as a private sector partner with the expertise and experience to constructively participate in an evolving healthcare environment.
We are confident that numerous opportunities will continue to exist to develop, test, and implement mutually beneficial and innovative healthcare delivery models and solutions through partnerships with the National and Provincial Departments of Health. The Presidential Social Compact on Health details actions that the public and private sectors can work on collectively to meet the population’s health needs through well-designed and implemented partnerships in infrastructure funding, service provision, and overall strengthening of the health system.
Furthermore, our diversification strategy bodes well for our future in healthcare. Over the years, AfroCentric has been pursuing the diversification of our involvement in the health sector. This places the Group in a strategic position to work with government on the NHI processes as implementation progresses.
As a Group, we have also adapted our strategies to align our business model to the government’s health policy direction and have successfully demonstrated our abilities in these strategies. A number of our subsidiary entities are already working closely with government in delivering innovative and sustainable services, such as the provision of chronic medicine to government clinic patients across four provinces.
Our involvement in the COVID-19 vaccination roll out has further demonstrated our capability to support government’s ambitions. Beyond vaccination, AfroCentric has been actively doing its part to help South Africa manage the spread of the pandemic in other ways, including rolling out COVID-19 rapid testing stations and making our network of experienced and registered nurses available to travel anywhere in the country to assist in vaccination administration.
Related risks
- NHI: Uncertainty surrounding implementation could impact investor perception, and Medscheme’s client base may be affected once implemented
- Loss of clients: Reduction of client base
- Membership: Attracting/ retaining members for our clients
- Technologies: Remaining relevant in the face of new disruptive technologies
Related material matters
- Access to healthcare and medicine
- Member satisfaction for clients
- Legal, regulatory and compliance management
- Business continuity and business model adaptation
Link to strategic levers
| 1 | https://www.worldbank.org Press release 2017.12.13. |
Understanding the global trend
While COVID-19 has presented challenges beyond measure, the pandemic has created an opportunity to increase digital innovation and has accelerated the use of telemedicine, thereby broadening access to healthcare. Mobile technology, in particular, has presented intriguing opportunities to expand access to care in all parts of the world, including in the more remote areas of developing countries.
The growing use of technology in all areas of life and business is likely to further increase the risk of cybercrime and therefore the need for cybersecurity and information security strategies, which require ongoing optimisation, investment and skills development to ensure business preparedness and continuity.
Understanding the trend in our context
The increasing connectivity and mobility, as well as the growing mobile phone penetration on the continent, offer opportunities to penetrate new markets and reach new members through online automated products and services and to significantly broaden access to healthcare and personalise virtual care.
The development of the National Digital Health Strategy for South Africa, 2019 – 2024, launched in the context of the massive reorganisation of the healthcare system required for the NHI implementation, will see many changes to how healthcare is delivered in our country.
Cybersecurity was rated as the top business risk in South Africa for 20211 and is considered one of our business’s core risks and priorities.
Responding strategically
AfroCentric is leveraging technology to innovate a new integrated model of sustainable healthcare that measurably improves access to quality care to achieve our vision and remain competitive. In addition, our growing data capabilities support our strategy to eliminate inefficiencies within the healthcare industry and optimise the value chain.
Related risks
- Cybersecurity: Ineffective cyber defence controls and mechanisms to protect critical infrastructure, systems and data against malicious cyber attacks
- Technologies: Remaining relevant in the face of new disruptive technologies
- Loss of clients: Reduction of client base
- Membership: Attracting/ retaining members for our clients
Related material matters
- Cybersecurity and information security
- Access to healthcare and medicine
- Business continuity and business model adaptation
Link to strategic levers
Understanding the global trend
The skills shortage present in many sectors requires employers to increasingly invest in the development of skills in employees and adopt a broader perspective – where the development of skills not only benefits the business in the short term but also provides longterm benefits to the industry and the country as a whole.
Shifting demographics and different work expectations can also result in a much higher turnover than in previous generations. Moreover, younger generations are not simply looking for employment anymore but choose jobs that offer them personal and professional development opportunities, agency in the team, and a sense of purpose and fulfilment. These shifts significantly change best practices in employee acquisition, development and retention and challenge businesses to find more meaningful ways to engage with employees.
Understanding the trend in our context
A significant risk affecting employee acquisition and retention is the overall skills shortage present in the sector.
Broader societal problems such as rapid mental health deterioration within a pandemic context also affect employee acquisition, talent management, and retention, increasing the need to foster collaborative models, team building, and employee mentoring.
Responding strategically
AfroCentric was established with the philosophy of promoting transformation and empowerment. We are a black-owned company and the most transformed healthrelated business listed in South Africa. The Group invests in healthcare-related businesses, and our contribution to healthcare extends beyond our products and services.
We invest in our people, support transformation, benefit society, provide health management to our members, and make healthcare more accessible to all South Africans. Our social impact starts within our Group and expands to the suppliers and communities we directly impact, as well as the broader society through our health management initiatives.
Related risks
- People risk: Skills shortage or inability to attract necessary dedicated resources
- Transformation: Maintaining level 1 status
- Staff retention: Failure to attract/ retain critical staff and scarce skills
- Organisational culture risks: Necessity to optimise organisational culture to enhance individual and Company performance
Related material matters
- Employee acquisition, talent management and retention
Link to strategic levers
