27 March 2001
Developed economies currently dominate in every category of Information and Communication Technology (ICT), ranging from levels of expertise, patents and copyrights registered each year, availability of ICT infrastructure and the deployment of applications used to reap full benefits of digital technologies.
One of the most pronounced effects of this is the yawning disparity between the North and South. In the United Nations Millennium Summit Report, Mr Kofi Annan observed that there is a technological shift that is already transforming social and economic life - the digital revolution.
This confirms our belief that we are in the midst of a technological revolution, where the rapid growth of electronic commerce with changes in information, computing, and communications have a profound impact on the way we do business, work and play.
Today, all of us do, by our presence here, confer glory and hope to the new-born arivia.kom that is on the way toward a merger success. When we unveiled the policy framework on the accelerate agenda of restructuring SOEs, we singled out this project as one of our key deliverable and milestone to be measured against.
I am therefore exceedingly excited to have the privilege to launch arivia.kom which is geared to deliver enhanced value propositions to customers and dramatically improve supply chain efficiencies in the burgeoning IT industry. I assure you it gave me the greatest pleasure to respond affirmatively to your invitation. It would have pained me immensely if circumstances had ordered otherwise.
As the invitation said…"If your vision of IT is somewhat one dimensional and blurred you're invited to see it through our eyes"….this is indeed what you will witness today as we launch an IT middleweight in the IT sector in which more or less 70% is dominated by few premium-rated IT heavyweights.
While arivia.kom might be a victim of market scepticism in this unforgiving and demanding market as shown by a dramatic fall in some counters, it captured the imagination of some significant IT players since our public announcement in January 2001. It is our firm belief, that given the solid synergies, skilled employees, growing annuity income and strong client base, this company headed for a heavyweight status, is poised to prepare us for the Information Age of the 21st century.
This company has a potential to dramatically widen the circle of digital opportunity and allow us to harness the power of digital technologies to increase productivity and global competitiveness as we move rapidly to a digitally inclusive society. These are challenges of our worthy great Nation.
The birth of arivia.kom was a product of concerted efforts in Government to extract the embedded value and synergies in its significant IT infrastructure within State-Owned Enterprises (SOEs) - specifically Eskom, Transnet and Denel. The overriding objective was to leverage these IT capabilities to accelerate service delivery, promote effective black economic empowerment, reduce input costs and make digital technologies the dynamo that drives our economy.
Outside these SOEs, the State established a State Information Technology Agency (SITA) through an Act of Parliament (No. 1324. 16 October 1998), as the information systems facility of the State chiefly responsible for management and execution of IT services and related work for, and on behalf of Government.
Thus, we see both these IT companies playing a complementary role in ensuring that Government is sufficiently capable to harness the power of digital technologies in addressing its social and economic objectives.
Mergers and Acquisitions (M&A) research shows that companies merge to increase value and grow on a sustainable basis, rather than narrowly focus on the "early wins" from cost reduction strategies that turn to frighten best employees into leaving and creating anxiety among customers. To us, forming strategic alliances and delivering enhanced and integrated value proposition to customers is the key to a successful post-merger integration.
We have also learnt from the so-called "deadly sins" of post-merger integration that it is important to put in place good corporate governance and top leadership in place within the short space of the consummation of the deal. We are happy to announce that arivia.kom has a full board in place led and chaired by Ms Nku Nyembezi-Heita.
Almost the entire top leadership is already in place to run the business on a day-to-day basis. The recruitment process for the CEO post is at an advanced stage and a formal announcement will be made by the end of April 2001.
One of the key challenges for the CEO and her/his executive team will be to overcome cultural differences and create a compound culture that takes the best elements from each organisation and incessantly communicate it across the company to achieve employee commitment.
The giant leap we take today will be one which sets us on the path to achieving full benefits of digital prosperity, lift more families out of poverty and help us close the digital divide. Our dream is to ensure that every South African has the opportunity to become technologically literate with access to cutting-edge skills at their fingertips. This will create a flourishing information society which spans disciplines like medicine, agriculture, manufacturing, mining and education needs - thereby improving quality of life while contributing to economic growth.
I trust that you will join hands with all stakeholders including your employees to ensure arivia.kom becomes a significant player in the IT industry on a global scale.
I have a great pleasure in declaring arivia.kom officially launched.
I thank you all.