The economic situation and challenges to management

Van Wyk, Ch is J. A icle The economic si ua ion and challenges o managemen Sou h A ican Jou nal o Business Managemen P o ided in Coope a ion wi h: Uni e si y o S ellenbosch Business School (USB), Bell ille, Sou h A ica Sugges ed Ci a ion: Van Wyk, Ch is J. (1982) : The economic si ua ion and challenges o managemen , Sou h A ican Jou nal o Business Managemen , ISSN 2078-5976, A ican Online Scien i ic In o ma ion Sys ems (AOSIS), Cape Town, Vol. 13, Iss. 3, pp. 151-155, h ps://doi.o g/10.4102/sajbm. 13i3.1191 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/217809 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. Sie dü en die Dokumen e nich ü ö en liche ode komme zielle Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich machen, e eiben ode ande wei ig nu zen. 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Box 7694, Johannesbu g 2000, Republic o Sou h A ica Add ess o Fedmech Deale 's Annual Gene al Mee ing a Sun Ci y, Ap il 21, 1982. Huldlge ekonomlese klimaa To somme onlangs nog he Suid-A ikaanse sakemanne· 'n guns ige ekonomiese klimaa en oo spoed in oo loed belee . Hoe omse e, bui engewone wins e en goedkoop, olop inansie ing was aan die o de an die dag. Hie die si uasie be eg e innige e ande as wa baie mense e - wag he me die ge olg da alle an ons nou me p obleme si wa d ingende aandag nodig be en baie inansiele onge ie e oo saak. Die belang iks e kenme ke an die huidige ekonomiese si uasie is da omse e besig is om a e pla en sel s e daal; k edie wo d al skaa se ; inansie ingskos e is baie hoog; oo ade hoop op; debi eu s e myne e leng; die isiko an sleg e skuld neem oe; e koopp yse kom onde d uk en wins e wo d al moeilike gehandhaa . Die ei da banke se p im a ui leenkoe se sede die begin an e lede jaa mee as e dubbel he o die huidige 200'/o en da inansiele ins ellings i klein ui leen ansaksies o 240/o en e a, beklem oon die oes and an inansiele knapheid. Vanjaa gaan dus deu swakke sake oes ande as 1980 en 1981 gekenme k wo d. Sakemanne sal eel inding yke moe wees en s enge bes uu sbeginsels oepas om kop bo wa e e hou. Die landbou-meganiese bed y sal ene syds die a koeling oel as ge olg an swakke landbou-oes e en die lae lakke an ekke -aankope as ge olg an die A lan is Dieselenjin-si uasie wa · nou e by is. 'n Ande ede is eg e da die oo e hi ing an die ekonomie wa een die einde an 1980 eeds duidelik sigbaa was, daa oe gelei he da die owe heid die emme 'n ge uime yd al aand aai. 'n Ma ige ekonomiese a koe- ling be e lede jaa eeds inge ee. Bui elandse ekonomiese s agnasie en eko dhoe in e nasionale en ekoe se be ons binnelandse ekonomiese a koeling e de aangehelp. Die einde an hie die ase is ongelukkig nog nie be eik nie. So 'n e posing is eg e nodig i die nasien en opknapping an die oo e hi e ekonomiese masjien, wa ook op bie - die s adium ie wa oo we k is. Die a koelings ase gaan meeb ing da 'n hele aan al onde nemings en g onde sal gaan. So oon we eldwye onde inding da e al die middelslag en kleine onde ne- mings 'n hoe onge allesy e wys wannee die ekonomie e swak, omse e en wins e daal, kompe isie moeilike aak en geld skaa s en duu wo d. We ende da di die on e - biddelike e loop an die ekonomiese siklus is, moe ons n~u _dubbel so ha d daa aan we k om kop bo wa e e hou. ~I 1s nie nou die yd om wanhopig e aak nie, wan di 15 hoo saaklik die d oe en o bou wa ui gesny wo d om plek e maak i die nuwe, welige Io e an die olgende ekonomiese g oeiseisoen. I.SI A bank's app oach o his si ua ion You may well ask how banks app oach hei business in a de e io a ing phase o he business cycle. Pa o he answe is o ealize ha a bank is a business jus like any o he business; when imes a e ha d, banks eel he p essu e jus like anyone else. In di icul imes i is he e o e unsound policy o a bank o be as lenien in espec o g an ing addi ional c edi o ex ending epay- men as when business is booming. These days banks will hus end o become mo e cau ious and conse a i e. They will end o inc ease lending a es, be s ic e in assessing c edi applica ions and be mo e wa ch ul in ega d o ou s anding deb as mo e di icul business condi ions eme ge. Fo you as deale s in he ac o and a m machine y ade, i is he e o e likely o become mo e di icul o a - ange and ob ain su icien inance o a ising s ockpile and g owing deb o book. In addi ion, you clien s migh ind i mo e di icul o aise inance o hei pu chases om you. Ha ing ega d o all his, you may well wonde how you should app oach he e y impo an ma e o ensu ing ha adequa e inance will be a ailable o he un- ning o you business. In his ega d i migh be ins uc i e o conside he p in- cipal guidelines ollowed by banks in e alua ing c edi ap- plica ions. These guidelines always apply. They do no change when he economy changes. Bu hey a e en o ced mo e s ic ly in he mo e di icul imes when business con- di ions de e io a e amids mo e s ingen inancial condi- ions, ha is as inance becomes sca ce and dea e . Fi s ly, banks e alua e he inancial his o y o he ap- plican business en e p ise. This is done by analysing inan- cial s a emen s o he pas ew yea s. F om his analysis a pic u e is ob ained o he liquidi y, sol abili y and p o- i abili y o a business, o in gene al e ms, he pas end o i s abili y o mee i s sho - e m commi men s. By and la ge his exe cise ocuses on a compa ison o cu en asse s and cu en liabili ies since co po a e liquidi y has p o ed o be he mos e ec i e inancial ancho in imes o economic ins abili y. Ha ing done his kind o analysis, he posi ion o he business in ela ion o p essu es om he en i onmen will be easonably clea . The sol abili y o he business also equi es sc u iny as i ela es o he ex en o which he business is unded wi h ou side deb . This is impo an o he inancie in judging he long- e m isk. We know ha p o i abili y is he success indica o o he business. A compa ison o p o i wi h in e es paid guides us owa ds he ex en o which addi ional inance can sa ely be bo owed and se iced. Equally impo an is he ac ha banks assess he managemen o he business o sa is y hemsel es ha he 'people compe ence' and leade ship exis o ca y he con- ce n h ough di icul imes. App op ia e business ex- pe ience and a p o en ack eco d a e wo o he mos impo an quali ica ions equi ed by a inancial ins i u ion when assessing a bo owe . Na u ally and e y impo an ly, banks also e alua e he expec ed u u e o he business. In o ma ion ega ding his expec ed u u e inancial equi emen s and i s expec ed abili y o mee i s u u e commi men s, is de i ed om a p ojec ed cash low s a emen . The cash low s a emen 152 also ells us a lo abou he inancial managemen capabili ies o he people in cha ge o he business. Ul daglngs aan bes uu U saI seke me my saams em da al hie die sake besonde e eise op die bes uu an 'n onde neming plaas. Indien die bes uu de die p obleme an andag eg e as ui dagings beskou, sal di meeb ing da die onde neming baie s e ke sal wees wannee die ekonomie die olgende g oei ase be ee. Di is eg e nodig da die bes uu de homsel die eg e ae a om die geleen hede wa ui die p obleme oo sp ui , e benu . Di is maklik wannee 'n onde neming en g onde gaan om e se da sy bank ho n nie e de wou inansie nie, da lone, sala isse en ande kos e handui ge uk be , o da die ege ing 'n onsimpa ieke maa eel inges el o houding ingeneem be . Nade e onde soek dui eg e gewoonllk daa op da ei lik diesel de swakplek deu gaans o sakemislukkings aanleiding gee, naamlik 'n eko aan bes uu skennis en dus e waa losing an die oepassing an bes uu sbeginsels. Wa bes uu be e , sal e al die kleinsakeman mee p o- essioneel moe begin dink indien by sy oo bes aan wil e seke . Besigheid is andag so mededingend da 'n p o- essionele benade ing in alle onde nemings onon bee lik gewo d be . Di is nie al yd maklik i e al ons klein sakemanne om hie die s andpun e onde sk y nie. Maa ek wil di beklem oon da die sakeman sal moe aanpas by die eise an ons yd, o moe e gee an die oekoms. Ek wil g aag saam me u kyk na 'n paa e eine waa aanpassings by e ande de oms andighede i die sake- onde neming noodsaaklik gewo d he . Toepassing an bes uu sbeginsels 'n Onde neming on wikkel, ne soos die mens, ana babas adium o olwasses adium. Die bes uu sbenade ing wa gedu ende die e skillende s adiums ge olg wo d, moe noodgedwonge e ande . Bes uu sbenade ing en bes uu s aa digheid is eg e ona - skeidbaa . Ge olglik e eis 'n e ande de bes uu sbenade- ing ook 'n ande bes uu s aa digheid. Die eienaa - bes uu de an 'n onde neming moe dus bese da hysel op so 'n wyse an we ke na bes uu de na ui oe ende beamp e moe o de da die g oei an die onde neming en die g oei an die pe soneel nie e aag wo d nie. 'n Mode ne en mee we enskaplike benade ing o onde - nemingsbes uu wo d blykbaa die mees e belemme deu - da ui oe ende amp ena e die beplanning- en behee unk- sie e waa loos. Di gebeu e dikwels da daa geen beplanning gedoen wo d nie, o da daa op 'n luk aak wyse beplan wo d. Beplanning is nie ne 'n p oses an oo ui dink nie; di behels ook die s el an mikpun e en die on wikkeling an spesi ieke planne om die mikpun e e be eik. Die innig e ande ende we eld waa in ons lee , e eis da baie aandag aan die oekoms gegee moe wo d. Goed- ge o mulee de planne s el inde waa heid die bes uu de in s aa om geleen hede oeg ydig e iden i isee en ge olglik be e e benu . Maa ~oedge o mulee de planne help weinig indien die planne me behee pun e e ska nie. Daa moe pe iodiek S.-A . Tydsk . Bed y sl. 198 2, ll(J) nagegaan kan wo d o alles nog olgens plan e loop. ln- dien daa ee s aan die einde an 'n lang pe iode - se die olle. inansiel~ jaa -:-- .on .de~ w~ d da die ondememing se m1kpun e me be e1k 1s me, 1s d1 e laa om ie s daa aan e doen. Ge olglik is di nodig da daa be yds en deu lo- pend an a wykings kennis geneem moe wo d soda eg- s ellende s appe gedoen kan wo d om e e seke da mikpun e wel be eik sal wo d. Indien u as sakeman die eise an die yd wil oo lee , is di nodig da u die basiese beginsels an bes uu moe ken da u die ake ui oe wa an 'n bes uu de e wag wo d en nie so asge ang wo d in die dag- o -dag ake an 'n onde neming da daa geen yd i die bes uu s ake be- s aan nie. As 'n mens jou aandag op bes uu s ake oespi s, hou di 'n e de e oo deel in, naamlik di dwing jou om sel dissipline aan die dag e le om jou beskikba e yd en bes e e benu . Doel e ende bes uu de s angskik hulle ake in olgo de an belang ikheid en handel hulle ook in daa die olgo de a . Ve de wo d oepaslike ake aan onde geskik es gedelegee wa die bes uu de mee yd gee om aan sy bes uu s unksies e bes ee. Opbou an 'n geskik e pe soneelko ps Ons in Suid-A ika be ind ons me 'n onbenydenswaa - dige oo loed ongeskoolde a beid, e wyl daa e sel de - yd 'n eko aan geskoolde a beid bes aan. Die yd be lank eeds aangeb eek da baie mee aan- dag aan die opleiding an we ke s bes ee moe wo d. O sien ons op een die onmiddellike kos e an die opleiding an 'n onp oduk iewe we ke e wyl die ui eindelike kos e an onhandige, one a e en onopgeleide we ke s so duidelik opwys in swak gehal e we k, 'n hoe kos es uk uu , e eemding an klan e en ui eindelike ag e ui gang an die besigheid? Ve suim om ons we ke s behoo lik oe e us i die dag aak lei ook o 'n hoe pe - soneelomse o pe soneel wa me e deelde aandag we k omda hulle so dikwels na ande geleen hede soek. Mo e sophis ica ed inancial managemen An enqui y among business manage s abou he mos p essing limi ing ac o s o business expansion would p o- bably acco d a high anking o 'inadequa e inancial esou ces'. Howe e , esea ch has indica ed ha in many businesses his cons ain is mo e pe cei ed han eal, and ha i o en esul s om he inco ec applica ion o man- cial esou ces. I is o en ound ha a business ca ies mo e s ock han is necessa y and ha oo much unds a e lock- ed in o ixed asse s. These i ems canno always easily be con e ed in o cash. Thus o e s ocking and hea y in es - men in ixed p ope y can easily esul in a sho age o unds which can handicap he company ia an inabili y o u ilize cash discoun s, and by weakening i s gene al com- pe i i e posi ion h ough illiquidi y. Financial planning has become a e y impo an unc- ion in any business. The bene i s s e ch beyond imp o - ing p o i abili y: sound inancial managemen also e ~hes high ma ks wi h inancial ins i u ions should an applica- ion o inancial assis ance be made. You banke can be o much assis ance in you inan- cial planning. He is he man wi h he app op ia e inan- cial expe ise and insigh who should s and closes o you S.A . J. Bus. Mgm 1982 13(3) wi h ad ice on inancial planning. Pe haps his is he app op ia e ime o say some hing abou he ela ionship be ween a business and i s bank. Banke s equen ly ge he imp ession ha clien s belie e ha in o ma ion should only be p o ided o hei bank when applica ion is made o inance. I migh be much mo e ewa ding o ega d you bank as a pa ne in you business, especially when bank loans a e employed in you company. Like any o he pa ne , you bank should know wha happens in he business and wha is being planned. The ela ionship be ween bank and clien is one o mu ual us and o be in o med, s eng hens he posi ion o us . I am su e ha i mu ual us exis s be ween you and you bank manage , and i you con inue o discuss he s eng hs and weaknesses o you business wi h him, hen he will go ou o his way o help you when assis ance is needed. Such a ela ionship will mo e o en han no assu e su - i al while an unwise compe i o migh go bus because o his banke emo ing he umb ella jus as he bad wea he closes in. You pa ne ship wi h you bank manage ep esen s one o he mos aluable eam ac ions o he con inued u u e success o you business. Die bes uu an ba es In onde nemlngs To op hie die s adium be ek my besig gehou me 'n algemene besp eking an die huidige ekonomiese oes ande en wa u moe doen om die ui dagings e o see . Ek wil nou g aag 'n bie jie s ils aan by 'n saak wa ans alma] na aan die ha le, naamlik die bes uu an ba es in 'n onde neming. Ee s ens kyk ans na die wyse waa op ba es ge inansie behoo e wo d, e olgens na wa die in loed an ko ings op u onde neming kan wees, en laas ens hoe doel e ende bes uu an bed y skapi aal u wins e kan e hoog. Die inansie ing an as e ba es Die belang iks e beginsel be okke by die inansie ing an as e ba es is om e alle ye e e hoed da ondse wa i ko e myndoeleindes benodig wo d, i die aankoop an as e ba es geb uik wo d. Vas e ba es wo d gekoop me die oog daa op om di oa 'n lang ydpe k e geb uik. Daa om behoo as e ba es me lang e myn ondse ge inansie e wo d soos, by oo beeld, e mynlenings o e uggeploegde wins e. Indien as e ba es me lenings ge inansie wo d, behoo die e ugbe alings e myn by die ekonomiese lewensduu an die ba e aan e pas. Lang e myn e plig inge plaas ui die aa d an die saak nie oo ma ige d uk op die kon an posisie an die onde ne- ming nie. Nog ans moe lang e mynlenings me so g aangegaan wo d, e al en ye an s ygende en ekoe se en a pla ende o dalende omse e aangesien so 'n e loop an sake be eken da 'n g a e wo dende en elas ui 'n k impende inkoms e be aal sal moe wo d. Die behoe e aan lang e myn inansie ing moe dus me so g bepaal wo d me die onde neming se e wag e e moe om die en elas e kan abso bee as een an die belang ike oo wegings. Die inansie ing an bed y sba es In eens elling me die inansie ing an as e ba es, kan bed y sba es ui sowel lang e myn- as ko e myn ondse ge inansie wo d. Die e houding waa in die wee soo e 153 inansie ing geb uik wo d, wissel an onde neming o ondememing. As 'n algemene iglyn behoo eg e nie mee as die hel e an u bed y sba es deu ko e mynlenings ge inansie e wo d nie. Die in loed an ko ings op winsgewendheid In hie die dae an hoe en ekoe se en in lasie, moe alles moon lik gedoen wo d om kos e e bespaa . Onde sulke oes ande on s aan kon an loeip obleme gewoonlik en is die aangewese aksie om kon an so innig moon lik e ealisee en be alings so s adig moon lik e doen. Di is 'n beleid waa mee geen ou ge ind kan wo d nie, op oo - waa de da ko ings nie onoo deelkundig e beu o oeges aan wo d nie. Indien ko ings e sp ake is, e eis di ee s 'n paa be ekeninge om die winsgewends e op ede e bepaal. As oo beeld wil ek die olgende ge al aan u s el, soos in Tabel I aangedui wo d: ges el een an u k edi eu e laa u 'n kon an ko ing an 50Jo oe indien daa onmiddellik i die goede e be aal wo d. Be aal u nie onmiddellik nie, wo d die ko ing e beu en moe die oile bed ag binne 30 dae be aal wo d. Wa sal u beslui wees? U sien in Tabel I da i die geb uik an die ondse i 'n e de e 30 dae een 50Jo en e di op 'n enkel oudige en ebasis eeds 600Jo pe jaa kos as u sou beslui om die ko ing p ys e gee. Di lyk nie na 'n goeie uil nie. Indien u diesel de ko ing aan u klien e gee, is di na uu lik ook waa da u 600Jo pe jaa i die geb uik an die ondse be aal deu di onmiddellik een 'n 50Jo ko ing in e o de . Voo da enige beslui dus oa ko ings geneem wo d, is di belang ik da so g uldige be ekeninge oo a gedoen wo d. Tabel 1 E ek an kon an ko lng an 5% Ko ing i kon an = S'1o K edie pe iode = 30 dae Kos e om ondse i 'n addisionele pe iode e gep uik = S '1 I . d . 360 12 Ge a peno es pe Jaa 30 = Kos e an ondse oo 'n pe iode an I jaa = Si x 12 = 601 op 'n enkel oudige en ebasis Ge olg ekking: Di is klaa blyklik e duu om onde die oms andighede die ko ing e e beu Managemen o wo king capi al A discussion o wo king capi al managemen mos ly co e s h ee con ollable i ems, namely c edi o s, s ock and deb- o s. The in e ela ionship be ween hese i ems has a deciding impac on he amoun o cash needed by he business o un i s ope a ion. Le us conside he example o a business wi h a cos o sales o R900 000 du ing any speci ic yea . In his business, deb o collec ions ake place a e 90 days, s ock is ca ied o 120 days and c edi o s a e paid a e 30 days. The si ua ion will hen be as indica ed in Case I (see Table 2). 154 Table 2 Wo king capi al managemen , Case 1 Caae 1 Annual cos o sales Deb o s' a cos (90 days) S ock ca y (120 days) C edi o s' inance (30 days) = R900 000 = R225 000 = R300 000 = R 75 000 Pu chase Paymen Sales Collec ion O 30 60 90 120 150 180 210 Days Amoun o inance equi ed: S ock keeping Plus deb o s Less c edi o s To al amoun R300 000 R225 000 R525 000 R 75 000 R4SO 000 A p ime o e d a lending a e o 200 o al inance cha ges amoun o R90 000 pe yea Hence, o inance deb o s and s ock, R450 000 wo k- ing capi al is equi ed a an annual in e es cos o R90 000 i he p ime o e d a lending a e is 200Jo. Wha would happen i he managemen o his business could sho en he s ockholding pe iod by 30 days as shown in Case 2? (See Table 3.) In Case 2 he business will need R375 000 in wo king capi al o inance deb o s and s ock. This ep esen s a educ ion in inance equi ed o R75 000 compa ed wi h Case l, and an in e es sa ing o Rl5 000 pe yea i he cos o unds emains a 200/o. A simila e ec would be achie ed i he c edi o s' pe iod can be leng hened o he deb o s' pe iod sho ened by he same pe iod. Nex , le us conside Case 3 whe e he deb o s' pe iod is sho ened o 60 days, he c edi o s' pe iod leng hened o 60 days and s ock has o be ca Tied o 90 days, as shown Table 3 Wo king capi al managemen : sho e s ockholding pe iod Cue U (S ockholding pe iod educed by 30 days) Annual cos o sales = R900 000 Deb o s a cos (90 days) = R22S 000 S ock ca y (90 days) = R22S 000 C edi o s' inance (30 days) Pu chase Paymen I I 0 30 Sales I 60 90 Days Amoun o inance equi ed: S ock keeping Plus deb o s Less c edi o s To al amoun = R 75 000 Collec ion I 120 150 180 R225 000 R225 000 R450000 R 75 000 R37S 000 A p ime o e d a lending a e o 20.,, annual inance cha ges amoun o R7S 000. Hence a sa ing o RIS 000 p.a. o e Case I. S.-A . Tydsk . Bed y sl. 1982, 13(3) in Table 4. I his si ua ion can be achie ed, only R225 000 will be equi ed o inance s ock and deb o s. Hence only 50% o he inance equi emen o Case 1 a only 50% o he o iginal inance cha ges. Table 4 Wo king capi al managemen : sho en deb- o s' pe iod, ex end c edi o s' pe iod Cue Ill Annual cos o sales Deb o s a cos (60 days) S ock ca y (90 days) C edi o s' inance (60 days) Pu chase 0 30 Paymen I 60 Amoun o inance equi ed: S ock keeping Plus deb o s Less c edi o s To al amoun Sales I 90 Days 120 = R900 000 = RISO 000 = R225 000 = RISO 000 Collec ion I 150 R22S 000 RISO 000 R37S 000 RISO 000 R22S 000 A p ime o e d a lending a e o 200 o annual inance cha ges amoun o R45 000. Hence a sa ing o R45 000 p.a. o e Case I. Impac o In la ion on wo king capi al equi emen s Le us supe impose a 150Jo in la ion a e on Case 1 and conside i s impac on wo king capi al equi emen s, as in- dica ed in Table 5 on page 155. The esul is an inc ease o R67 500 in wo king capi al equi ed which adds Rl3 500 o he in e es bu den (a p ime bank o e d a a e o 200Jo). To e ain he annual in e es cos a he R90 000 o Case 1, we now equi e a educ ion o 23,5 days in he cash low cycle, ha is a educ ion om 180 o 156,5 days. This can be achie ed by educing he s ock ca ying o deb o s' ou s anding pe iod by 31,5 days, inc easing c edi o s' e ms by his numbe o days, o e ec ing a combina ion o hese gi - ing he same esul . Ten slo e: enkele p ak lese wenke Kyk ind ingend na die bes uu an u bed y skapi aal; hou die e loop an oo ade, debi eu e en k edi eu e yn dop en s el aksieplanne in we king om e myne s6 e k imp/ ek da u die maksimum- oo deel e k y. Moenie ko ing e beu o oes aan oo da u so g uldige be ekeninge oo die kos e daa an gedoen be nie. Kies die inansie ings e myn om aan e pas by die ekonomiese lewe an die ba es wa ge inansie wo d. Bepaal u kon an behoe es oo a deu kon an - beg o ings op e s el. Hou u bankbes uu de ingelig en bou 'n goeie e - s andhouding me ho n op soda u 'n inansiele sam- b eel kan he wannee die ekonomiese een wee begin ui sak. S.A . J. Bus. Mgm 1982 13(3) Table 5 Impac o in la ion on wo king capi al equi emen s Case I plus Case I 1 S'1o in la ion Annual cos o sales R900 000 RI 03S 000 Deb o s a cos (90 days) R22S 000 R 2S8 750 S ock ca y (120 days) R300000 R 34S 000 C edi o s' inance (30 days) R 7S 000 R 86 2SO Pu chase Pay Sale Collec yedi o s deb o s I 0 30 60 90 120 ISO 180 210 The wo king capi al equi emen changes as ollows: Case I plus Case I lSOJo in la ion S ock ca y R300 000 R34S 000 Plus deb o s R22S 000 R2S8 750 RS2S 000 R603 750 Less c edi o s R 7S 000 R 86 2SO R4SOOOO RS17 SOO Annual inance cha ges a p ime bank o e d a a e o 20% R 90000 RI03 SOO Inc eased in e es cha ges as a esul o in la ion R 13 SOO Hence, 23,5 days educ ion in cash low cycle equi ed o ecoup Rl3 SOO addi ional inance cha ges. Om mee a e slui : V moe so g da elke sen wa u beskikba e inansie ing kan e dien 'n byd ae o u wins )ewe , wan inansie ing is skaa s en duu . Finansie ing weie nie om oo yd e we k nie, di neem ook nie e lo nie, di wo d nie deu akbonde behee nie en slaap nie in die nag nie. Daa om moe u di 24 uu pe dag ha d laa we k. HSRC In es iga ion in o In e g oup Rela ions: The p og amme and i s inancing H.C. Ma ais and Lyne e D eye Human Sciences Resea ch Council (HSRC), P i a e Bag X270, P e o ia 0001, Republic o Sou h A ica In oduc ion Economis s in pa icula and social scien is s in gene al a e in i ed o pa icipa e in he HSRC In es iga ion in o In- e g oup Rela ions. A budge independen o he usual inancing o esea ch a uni e si ies is a ailable o esea ch in o he mos p essing aspec s o he ela ionships be ween he majo g oups in Sou h A ica. This a icle p o ides in o ma ion on he backg ound o 155 and managemen o he HSRC In es iga ion in o In- e g oup Rela ions. A he same ime i is also an in i a- ion o he esea ch communi y o pa icipa e in he p o- g amme by applying o inancial assis ance. Backg ound Resea ch councils in mos indus ialized coun ies ini ia e and suppo p oblem-o ien ed esea ch. In his way esea ch can con ibu e owa ds a be e unde s anding o he na u e and p ocess o p essing social p oblems. The Human Sciences Resea ch Council since 1980 also ad- minis e s a budge speci ically p o ided o p oblem- o ien ed esea ch. By hei e y na u e social p oblems a e mul idimen- sional. The accen is he e o e placed on he co-ope a ion o as many esea che s as possible om di e en esea ch o ganiza ions, as i is ob ious ha a single o ganiza ion in Sou h A ica canno app oach a comp ehensi e p oblem mul idisciplina ily, on i s own. The co-ope a i e app oach also implies ha such a p oblem can be app oached om di e en ideological, heo e ical and me hodological pe spec i es simul aneously. The i s esea ch p og ammes ha we e unde aken wi hin his amewo k we e he HSRC In es iga ion in o Spo unde he leade ship o P o . G .J .L. Schol z o he Po che s oom Uni e si y o CHE, and he HSRC In- es iga ion in o Educa ion unde he leade ship o P o . J.P. de Lange o he Rand A ikaans Uni e si y. F om a su ey ha was conduc ed du ing 1980, he ield o in e g oup ela ions eme ged as he single mos impo - an a ea o esea ch in Sou h A ica (see HSRC Resea ch Bulle in, 1981, 11(2), l - 3). Consequen ly he Resea ch P io i ies Commi ee ep esen ing he majo esea ch sec- o s in Sou h A ica, ecommended o he HSRC ha a b oad in es iga ion in o in e g oup ela ions be unde - aken. This ecommenda ion was accep ed and du ing 1981 planning s a ed. The in es iga ion was hus solely ini ia ed by he HSRC. Resea ch managemen and o ganiza ion The HSRC In es iga ion in o In e g oup Rela ions is managed and con olled by a main commi ee. The main commi ee consis s o expe s ep esen ing he sec o s ha ha e a di ec in e es in in e g oup ela ions. Fields and wo k commi ees Because he esea ch a ea, in e g oup ela ions, is po en- ially so as , ollowing guidelines a e necessa y o he delinea ion o he in es iga ion: The accen alls on he ela ions be ween he main popula ion g oups in Sou h A ica like he A ikaans- and English-speaking Whi es, u ban and homeland Blacks, Colou eds, Indians and la ge immig an g oups. The basis on which he popula ion is analysed ( o ex- ample in e ms o in e es g oups), will be pa ly de e - mined by he heo e ical s and o he esea che . The esea ch is p oblem-o ien ed and hus ocuses on he mos opical aspec s o in e g oup ela ions. The main commi ee di ided he a ea in o hi een ields: Theo y and me hodology His o ical aspec