31 August 2000
On 1 August last year, the Office for Public Enterprises was upgraded to the Department of Public Enterprises. The change in status was motivated by the need to develop new resources within Government to exercise increased authority over SOEs and to accelerate their restructuring to ensure maximum economic impact. Our mandate was broadened, our personnel complement increased, our image and premises have been modernised, and our productivity has improved. Tomorrow, 1 September, is officially the first day of Spring, and so we thought it appropriate to celebrate and pre-empt the new season with the official launch of the new, fresh-faced department!
The new Department has 103 posts, of which 64 have been filled. We have adopted an incremental approach to recruitment to ensure that we build effective teams, establish an appropriate management ethos, and attract the best skills we can from the marketplace. We expect the remaining posts to be filled in the next few months. Besides the remarkable spread of skills and talents that now reside in the department, we have achieved some remarkable success in terms of representivity. Thus, 80% of our total staff are Black, comprising 70% African, 6% Coloured and the remainder Indian, and 20% White. 58% are women. In terms of Management, 87% of our Management is Black, made up of 67% African, 13% Indian and 7% Coloured, and 13% is White. We are proud to have exceeded the 50% black target. To date we have been less successful in terms of the target for female managers as only 20% of our Management are female but we envisage that this could change significantly when we fill the vacancies we have.
The Department is based on an open plan design that is in line with modern practice. There is already much greater interaction between staff who increasingly identify themselves as members of teams within the broader organisation. There have already been significant improvements in productivity, and I also sense a profound increase in morale and commitment. I would go so far as to say that all of the people who work here are much more aware of the nature of our work and the role that DPE plays in the fulfilment of government policy. In this sense, the redesign of office space has led to significant empowerment by members of the Department. I also wish to announce formally that the whole Department from now on will be designated a "smoke-free zone", which means that smoking, if at all, will take place outside the limits of the 4th floor!
You are all aware that we launched a Policy Framework for the Restructuring of State Owned Enterprises earlier this month. I was especially pleased to note that after the official launch to the investment community and the media, the DG led a discussion with all staff members here in the Department as part of our efforts to ensure that we all know why we are here. The Policy Framework provides us with the overall framework of government policy. The Business Plan, which I am also unveiling today, outlines how we, the Department, are going to implement that policy.
Let me briefly outline the key areas of the Business Plan.
Firstly, the Department is guided by a vision to establish "Restructured SOEs in a globally competitive environment, promoting growth and a better life for all". That vision can only be achieved through action that we can measure. So, the Department will be driven by a mission "To direct and manage the accelerated restructuring of SOEs to maximise shareholder value."
Besides an overall set of Departmental strategic objectives, each programme has, in turn, developed a particular set of strategic objectives. Together, these inform the business plan that is based on a Balanced Scoreboard approach measured by individual performance agreements. In short, this means that we examine people's performance from at least four perspectives: economic; relations with stakeholders and partners; the degree of innovation and learning; and internal processes. The most signficant shift from the past is that we move beyond simplistic measurements of success based on financial performance. The content of the DG's performance agreement that we will sign shortly is the prime departmental example of the approach.
The Department's strategic objectives are spread across the four perspectives. I will not go into the details now. They do appear in the literature that you have been given.
The concept of balance is also central to the organisational structure.
The basic structure of the organisation covers 5 programmes: Management and Administration; Restructuring of SOEs; Performance Monitoring and Benchmarking; Strategic Analysis and Policy Development; and Alternative Service Delivery.
The Management and Administration programme includes the overall management of the Department and the Ministry. Its other key role is to provide the leadership and create an enabling environment where all its employees can learn and grow in an informed manner whilst unfolding the restructuring process.
The Restructuring Programme is primarily responsible for developing detailed, enterprise-specific restructuring plans, together with the enterprises involved, and for directing the implementation of these plans. It is also responsible for managing transactions. Recently we have established an IPO office to manage the listing of shares on the stock exchange.
The Strategic Analysis and Policy Development programme develops overall policy and assists in creating sector-specific policy. On the basis of economic and sectoral analysis, it would provide a range of restructuring recommendations or possibilities for the restructuring of SOEs
The Performance Management and Benchmarking Programme's monitors financial performance and adherence to corporate governance practices in SOEs before, during and after restructuring. It also undertakes rigorous performance monitoring and evaluation of SOEs to ensure, inter alia, adherence to performance management best practice.
Alternative Service Delivery (ASD) ensures the balance between economic and social imperatives we believe is central to our policy by advocating alternative service delivery mechanisms and developing best-practice guidelines for ASD.
The working processes of DPE are based on the principle of sharing resources between programmes. The programmes must follow a resource buying and selling agreement that will include the expected deliverables of seconded personnel. Sign off on the output is also required. When executing projects, DPE must work towards project outcomes in an interactive process with successive loops of activity rather than sequential processes so as not to delay downstream actions.
This is illustrated in the diagram shown:
Thus, Strategic Analysis provides rapid diagnosis and direction by developing high-level business architectural options that are then handed over to the Restructuring Programme. Strategic Analysis would have an ongoing but subsidiary role during the entire process. The Restructuring Programme would also be involved from the start, but during the drawing up of detailed restructuring plans and implementation, they would be the main player.
We have created a non-traditional culture relative to that typically found in the public service. The concept of project-based teams is encouraged. Expertise rather than office position or control over resources is highlighted. We want to create an environment in which professional expertise can thrive, where people can generate ideas, while at the same time ensuring that the organisation achieves its objectives. Information must be shared between members and where a questioning culture prevails. The organisation must be forward looking; and 'planning' and 'doing' have to happen simultaneously.
When you read the Business Plan you will see that we have been fairly ambitious in what we would like to achieve. I believe that the Department we have created and the people employed by the Department will ensure that we achieve our objectives. Although our aspirations are high, we believe that having restructured SOEs in a globally competitive environment promoting economic growth and a better life for all is a worthy vision and we believe that despite the challenges in achieving it, it can be a reality.
I want to place on public record my thanks and appreciation for the way in which every single member of this Department contributes to the historic task we have. Whether it is the photocopying and compilation of fat documents, the provision of refreshment to guests, attendance of numerous meetings, the production of reports, or dealing with diaries and appointments, or the preparation of reports on SOEs or for Cabinet, all of you are important cogs in a complex machine. Often I have left the office late in the evening and have seen staff hard at work on one or other task. You will be amazed at how many people, from Ambassadors to CEOs, to members of the public, compliment me on the work of this Department. For my part, I am proud to acknowledge these comments and to be a Minister of Public Enterprises who can rely on a growing team of committed and competent people.
There are many guests here today with us and I wish to thank you all for showing your support by joining us in launching this Department, as well as our business plan.