VAT Included @ 14%

VAT Rate Increase in South Africa and its impact on Software Systems

On the 21st of February 2018, the then Minister of Finance in South Africa (Malusi Gigaba) announced the increase of the Value Added Tax (VAT) rate from 14% to 15% during his budget speech, the first increase since 1993. This increase is effective 1 April 2018 meaning businesses that charge VAT for their products/services will need to make the necessary adjustments before then.

I am interested in the effect this increase has on businesses that charge VAT and are heavily reliant on software systems for their sales, billing and reporting processes. The two primary considerations for these software systems that come to mind are – the original Software Design and the resulting VAT related adjustments which I will call the VAT Update Software Project.

1. Original Software Design

I imagine that questions such as “How easy and quick will it be to update the VAT rate” have been asked of development teams following the budget speech. Such questions are related to the original software design – whether a software system was designed to be flexible and future-proof. For example, can a privileged user of the system update system-wide parameters (such as VAT rate) from the system’s front end instead of requiring a change to the source code by the software development team? However, in this particular instance, I can understand how a VAT rate that has not changed in 20 years could have been hardcoded* instead of made configurable (perhaps due to an oversight by the software development team or the result of pressure from business teams/users to turn around development tasks speedily).

2. VAT Update Software Project

Regardless of whether the VAT rate was hardcoded or made configurable, updating it will require some analysis, development/user update and testing which constitute what I have called the VAT Update Software Project (one does not simply search and replace 0.14 / 1.14 / 14% with 0.15 / 1.15 / 15%). Given that the amount of time between the announcement during the budget speech and the effective date of the VAT increase is just under two months, it is most probable that the knee-jerk reaction by many of the affected businesses has been that of commissioning VAT Update Software Projects on the fly. Execution of such project requires agility in undertaking the resulting project management tasks, impact analysis, software development / VAT rate configuration update, system testing and release planning among other activities.

At present, we are just under two weeks from the effective date of the VAT rate increase. This, coupled with the public holidays on the horizon make for some pretty tight project timelines for software teams looking to deliver on VAT Update Software Projects by 1st April 2018. Here’s to holding thumbs for them!


Footnotes
  1. Hardcoding in Software Development means that updates to a variable such as VAT would require a change to the source code by a Software Developer. The opposite of this would be making it configurable by an end user such that they can login to the system and update it perhaps from a Configuration menu.

Luxury Bamboo Socks, Impeccable Service and Niche Retailing

Over the last few months, I have had a string of conversations with different friends about bright coloured and bold socks commonly referred to as happy socks. In particular, I was trying to understand the rationale behind purchasing them as they are on the pricey side, wearing them as they are rather daring and ofcourse the business mechanics and success of the different fashion brands making these kind of socks. Ironically, following on from these conversations, just over two weeks ago, I was lucky to attend a talk where the stylish Nic Haralambous was sharing the journey he has been on, building his luxury men’s style brand – Nic Harry and some thoughts on e-Commerce in South Africa. I thoroughly enjoyed the talk as I found it to be very practical and quite relevant especially as I have a handful of friends with small businesses that have a retail component to them. Hence I decided to pen this article.

The Why and How

One of Nic’s motivations in starting the Nic Harry brand was that he felt that the sock space in South Africa was boring and lacking in imagination. Typical retailers stock bland or plain coloured socks for the most part, hence the bright coloured, fun and bold Nic Harry socks provided (and continue to provide) a fresh and exciting alternative. To differentiate the brand from other similar sock brands, Nic Harry opted for bamboo instead of cotton for the fabric and local South African production as compared to mass production in China. Bamboo has advantages of being organic, eco-friendly and anti-bacterial whilst local production meant job creation in South Africa. Over and above this, Nic Harry have zeroed in on providing exceptional and personalised service, something that typical traditional large retailers and other service providers have spectacularly failed at. For example, the Nic Harry sales team do not wear shoes inside their stores. Why? To stoke the potential customers imagination and make them see, first hand what it looks like to wear the socks and presumably how comfortable they are.

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Varsity Podcasts

The Varsity Podcasts Story

The Beginning

Breaking into radio and television is ridiculously tough, the industry is cutthroat. This holds true not only at a national level but university level too. Consider the case of a South African university with 5000 students (conservative estimate), the university radio station club will have say upto 50 active members. That translates to approximately 1% of the student population, leaving so much potential radio talent untapped and undiscovered.

Considering my personal experience, the first university I attended did not have a radio station during my era. However, some friends and I attempted to put together a podcast show and unfortunately the rigmarole of getting approval from the university administration stopped us dead in our tracks. The next university that I then enrolled into did have a radio station which I auditioned for, but unfortunately the demands of my studies did not afford me the luxury of time to make a meaningful contribution thereof. However, both of these experiences did lead me down a path of questioning whether something could be done to tap into undiscovered university radio talents, bypass the formal structures and admin that are part and parcel of traditional university radio stations as well as create curated online content available on demand. Read more

4 Thoughts on Excellent Service

Most individuals, whilst going about their day to day life and engaging with various service providers, can attest to experiencing customer service with varying levels of excellence. In some cases, the service has been so amazing and memorable, that they could not stop raving about it to their friends and family. In other cases, it has been average (just okay, nothing to write home about) and in cases not worth remembering, the service has been horrible, to say the least. I have experienced these different scenarios myself and began to reflect on what made a particular service interaction superior over another, especially when it involved two different service providers in a similar line of work. Read more