THE BUSINESS MAGAZINE FOR AFRICA’S INDUSTRY LEADERS
AFRICA
ENTERPRISE Issue No.47
www.enterprise-africa.net
SHELL SOUTH AFRICA:
Shell Looks
to Coffee
ALSO IN THIS ISSUE:
Broll / SANSA / Naledi Rail Engineering / Hatch Goba
EDITOR’S LETTER
Joe Forshaw EDITOR joe@enterprise-africa.net Hal Hutchison SALES MANAGER hal@enterprise-africa.net Sophie Bolderstone SENIOR PROJECT MANAGER sophie@enterprise-africa.net Sam Hendricks SENIOR PROJECT MANAGER sam@enterprise-africa.net Shaun Cousins PROJECT MANAGER shaun@enterprise-africa.net Shannon James PROJECT MANAGER shannon@enterprise-africa.net Daniel Scott PROJECT MANAGER daniel@enterprise-africa.net Alex Kane PROJECT MANAGER alex@enterprise-africa.net Jane Larkman ACCOUNTS MANAGER finance@enterprise-africa.net Harvey Tarlton SENIOR DESIGNER harvey@enterprise-africa.net
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Welcome to our latest edition… This month, our lead feature comes from Shell South Africa, one of the country’s leading petroleum companies. But we’re not talking about the rising fuel cost or the tumbling global oil price. We’re not even talking about fracking. We are talking about coffee. The so-called ‘coffee culture’ is on the rise in South Africa as people look to caffeine to fuel their day. Shell has cottoned on to this trend and is now rolling out its partnership with Vida é Caffe, a leading SA coffee company, across more of its retail outlets. The partnership goes back to 2013 and both parties have seen such success from the relationship that Shell is now keen to continue the roll-out across its hundreds of retail outlets all over the country. Shell’s Retail Marketing Manager, Yaasier Abrahams tells us that the move has strengthened consumer relations and has allowed the business to drive up sales of complementary products in Shell Select convenience stores – it’s a story of growth and success for all involved, just the sort of thing we like. We also talk to Broll who tell us more about their offering on the continent; Foskor tell us more about a hug planned investment into new plant that will revitalise the company; Naledi Rail Engineering tell us about their growth to become a globally recognised business and the Durban ICC talk to us about how the city and the business are gearing up for big events in the future. If you have any major investments or successes to talk about, tell us right now. We’re online @EnterpriseAfri1
Joe Forshaw EDITOR
GET IN TOUCH +44 (0) 20 8123 7859 joe@enterprise-africa.net www.enterprise-africa.net
www.enterprise-africa.net / Issue No.47 / 3
06/NEWS: The Month that was... A round up of some of the latest news stories in the industry
86/EXHIBITION CALENDAR: Key Upcoming Events Across the Country Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors.
KEEP UP TO DATE WITH ALL THE LATEST AFRICA NEWS ON TWITTER:
@ENTERPRISEAFRI1
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8/BROLL FACILITIES MANAGEMENT: “Africa, We Have You Covered” The challenges of being a facility manager in 2016 are becoming more and more significant but industry leader, Broll (part of the CBRE network) has seen success across South Africa and on the continent. Director: Technical Chris Aslett explains more…
CONTENTS 22/
72/
30/ 22/SHELL SOUTH AFRICA: Shell Looks to Coffee to Fuel Consumer Demand
60/DURBAN ICC: “Meetings and Exhibitions Are Great Vehicles for Moving Business Forward”
Shell South Africa is perhaps the most recognised fuel brand in the country, if not the world. But positioning the brand as the frontrunner in the industry doesn’t come easily.
The city, the beach, the people and the government are all ready to welcome guests from across the globe to the Durban International Convention Centre.
30/SANSA: Is Space Weather Affecting Your Business?
66/INSIDE DATA: Engaging The Future
As the need for electricity grows, so does the need for effective solutions when it comes to billing their customers and ensuring fair, efficient and stable supply.
With innovative multi-channel content-rich customer engagement, South Africa-headquartered InsideData enables companies to measure and improve business communication and build their brand.
36/SOUTHEY CONTRACTING : A “One Stop Shop” Solution for Prolonging the Lifecycle of Industrial Assets
72/TIGER BRANDS: Mac Dougall Will Have to Earn His Stripes in Tough New Role
Southey Contracting has a long and proud history in South Africa and through training, development and the delivery of quality service
A mixed 2015 for Tiger Brands saw longstanding CEO Peter Matlare step down and Lawrence Mac Dougall hired as his replacement.
44/FOSKOR: Investments Into New Plant Set to Stabilise Foskor
78/EFFECTIVENESS: Unique Outsourcing Solutions
Foskor is a proudly South African producer of phosphates and phosphoric acid. The company has big planned investments on the horizon, the future is looking bright…
The Effectiveness Company specialises in delivering sustainable operational performance improvement and optimisation.
52/NALEDI RAIL ENGINEERING: The Rising Star in an Industry Revolution
82/HATCH GOBA: Engineering Excellence in a Quickly Changing Environment
Over the next few years, we are going to see more and more investment into Africa’s rail industry - this is a company powering towards success…
Working on engineering projects all over the country, and often further afield in Africa, Hatch Goba is now the go-to name for projects big and small.
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R2BN INJECTION FOR DUNLOP Sumitomo Rubber South Africa has invested R2 billion to expand and upgrade its KwaZulu-Natal based Dunlop manufacturing plant in Ladysmith. The company is a leading manufacturer of passenger and commercial tyres in South Africa. It currently employs 1 180 people and 900 of these are employed at the Ladysmith plant. “Our R2 billion investment consolidates our commitment to the South African and KwaZuluNatal provincial economy, as well as the Ladysmith community. “As one of the largest employers in Ladysmith, this will deepen our impact on stimulating job creation through increased manufacturing production and industrial development competitiveness,” Sumitomo Rubber South Africa CEO
Riaz Haffejee said in a statement. Haffejee said the direct job creating impact and employment spinoffs, as a result of the completion of the first phase of the project, are already being realised. “Employment levels are already being increased due to Phase One. The first of nearly 120 new employees needed over the next few years have already been recruited. Phase Two will attract a further 300, lifting the Ladysmith plant to over 1 200 employees on completion of the second investment phase,” he said. Plans for expanding the Ladysmith plant commenced in 2014, with R1.1 billion being allocated by parent company Sumitomo Rubber Industries (SRI) in Japan for the development of Phase One.
FREE WI-FI FOR E-CAPE RESIDENTS The Department of Telecommunications and Postal Services has invested R6 million towards the rollout of free public Wi-Fi in the Eastern Cape. “We have already connected in Korsten, the licensing department, the Customer Care Centre and the Public Library to free Wi-Fi,” Minister of Telecommunications and Postal Services, Siyabonga Cwele, said on Friday. Speaking during the launch
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at the Nelson Mandela Bay Municipality, the Minister said the rollout of the free public Wi-Fi affirms government’s commitment to the National Development Plan’s vision of a robust information society and knowledge economy that is both inclusive and prosperous. “Let me announce that once you have connected to the free public Wi-Fi, you will be allocated 100mb per day on each device you connect
at speeds of 10mb/s,” Minister Cwele said. Government is currently working with the metros of Tshwane, Ekurhuleni, Nelson Mandela Bay, Mangaung, Cape Town and Johannesburg to roll out free Wi-Fi. “Access to the internet is the single most powerful tool we have in combating the inequality experienced in the delivery of quality education” Minister Cwele said.
NEWS ROUNDUP R400M AGRICULTURE DEAL TO CREATE NEW JOBS Trade and Industry Deputy Minister Mzwandile Masina has welcomed a R400 million investment by Griekwaland-Wes Korporatief (GWK) that will see the company creating 100 new permanent jobs in the Northern Cape. This, as the Deputy Minister and Northern Cape Premier Sylvia Lucas, as well as the Chairman of the Board of Directors at GWK, Frank Lawrence, officially opened GWK’s factory last month. The opening of the factory — which includes a wheat mill and pasta plant among others — will see the creation of 100 new permanent jobs in the agricultural sector in Kimberley and other surrounding areas in the province. Deputy Minister Masina said GWK is already implementing the National Development Plan’s vision of making agriculture and agroprocessing the primary economic activity in South Africa by investing and creating jobs in the sector. “As government we will be precisely focusing on agroprocessing in order to be able to open new markets especially abroad. We are also upgrading the infrastructure in the continent to ensure the movements of goods and people in South Africa and the rest of the continent are smoother especially for those who are exporting and importing. This is to ensure that intra Africa trade is practical,” he said. The Chairman of the Board of Directors at GWK, Frank Lawrence, said they were extremely proud to have been bold enough to enter the agro processing space and to show their commitment to agriculture and the development plans of the country.
AB INBEV COMMITS TO SECURE JOBS IN SABMILLER DEAL Anheuser-Busch (AB) InBev has made a commitment to protect South African jobs in the proposed acquisition of SABMiller. South Africa’s Ministry of Economic Development on Thursday said government and AB InBev reached an agreement on the public interest conditions that will be recommended to the Competition Commission and Competition Tribunal in connection with the proposed acquisition. The agreement relates to issues of employment, localisation of production
and inputs used in the production of beer and cider, empowerment in the company, long-term commitments to South Africa and participation of small beer brewers in the local market. “In a ground-breaking commitment, AB InBev has undertaken to ensure that at no point in the future will there be involuntary job losses in South Africa as a result of the transaction. In addition, the company has committed to maintain its total permanent employment levels in South Africa as at the date of closing, for a period of five years” said the ministry.
FORD’S R2.5BN INVESTMENT IN SA WELCOMED Trade and Industry Minister Rob Davies has welcomed Ford’s R2.5 billion investment in local production, saying it’s an important indication of confidence in South Africa. This, as Ford Motor Company of Southern Africa announced the investment to expand operations in South Africa at its Silverton Assembly Plant, in Pretoria. This will see the production of the all-new Ford Everest, along with the new Ford Ranger that was launched at the end of last year. Minister Davies said the investment not only shows confidence in South Africa but also shows the significance of the Africa Growth and Opportunity Act (AGOA) two-way benefits. AGOA is a legislation that provides duty-free market access to the US for qualifying sub-Saharan African countries by extending preferences on more than 4 600 products. “The automotive industry is of significant importance to South Africa.
To date we have invested more than R25 billion in the motoring industry and are positive that through this investment we will see more and more vehicles manufactured locally,” said Minister Davies. Ford Executive Vice President and President of Europe, Jim Farley, said the investment will create approximately 1 200 new jobs at Ford South Africa and within the South African supplier network. “Our customers love the capability and utility offered by the all-new Ford Everest. By producing the Everest in South Africa, we will be able to make it more readily available, and in a greater variety of models, for customers throughout Sub-Saharan Africa. “The R2.5 billion investment reaffirms the importance of these markets as part of our growth strategy across the Middle East and Africa. It further reinforces South Africa’s position as a strategic export base for Ford Motor Company,” explained Farley.
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BROLL FACILITIES MANAGEMENT
“Africa,
We Have You Covered” PRODUCTION: Karl Pietersen
The challenges of being a facility manager in 2016 are becoming more and more significant but industry leader, Broll (part of the CBRE network) has seen success across South Africa and on the continent. Director: Technical Chris Aslett explains more…
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BUSINESS PROFILE
//
In 2015, South Africa’s leading commercial proper ty ser vices company, Broll, was lauded for its work and received Gold for Facilities Excellence in the PMR Golden Arrow Award. This followed on from winning Bronze in 2014 and Gold in 2013. The company was also recognised for excellence at the Euromoney Real Estate Awards 2015 where it was named as the number one Advisors and Consultants in Ghana, Nigeria and South Africa. Broll Ghana scooped three awards; overall Advisors and Consultants, Advisors and Consultants for Agenc y/Letting and Advisors and Consultants for Research. Broll Nigeria was named overall Advisors and Consultants,
//I WOULD DEFINITELY SAY THAT AFRICA IS A HUGE FOCUS, ESPECIALLY WITH THE LATEST SUCCESS THAT WE’VE HAD WITH THE MASSMART PORTFOLIO//
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Advisors and Consultants for Agenc y/Letting and Advisors and Consultants for Research while Broll South Africa was named overall for Advisors and Consultants and Advisors and Consultants for Research. And in 2016, Broll’s success has continued, despite the tough economic conditions, and the business is now look ing for growth in new industr y sec tors. Direc tor: Technical, Chris Aslett tells Enterprise Africa that Broll is targeting the healthcare industr y and also look ing to bolster its por tfolio in the telecoms sec tor with a huge new customer. “ We are negotiating in SA and across our borders in Mozambique where we are look ing at hospitals and that type of facility with regards to plans going for ward and getting more involved with healthcare,” he says. “ We tr y and steer away from putting ourselves in a box as far as oppor tunities go. We’ll look at all sizes but our focus is private hospitals. State owned hospitals usually have in-house facilities management operations. When we get involved with state owned facilities, we usually go in as a consultant and they ’ll ask us to form par t of a task team or they ’ll ask us for advice so our target facilities would be more in the private sec tor. “ The biggest focus at the moment, and for the nex t few months, will be the Vodafone tender. “ The first phase will be mainly focussed on South Africa with later stages focussing on Southern Africa. The long-term goal is to ser vice Vodafone industr y across Africa with ver y much the same principle that we have with MTN but this will be a global arrangement and for par t
BROLL FACILITIES MANAGEMENT
of the bigger CBRE pic ture,” he adds. Work ing on the continent is something that Broll is familiar with and has done for many years. In South Africa, the company is headquar tered in Johannesburg but the group has offices all over the Africa including operations in Angola, Cameroon, Ghana, Indian Ocean Islands, Ivor y Coast, Kenya, Malawi, Mozambique, Namibia, Nigeria, Swaziland, Uganda and Zambia and provides real estate ser vices in other African countries. R ight now, the African continent forms a major par t of the Broll strategy and Aslett says that work with a large retailer has focussed the company ’s attention in Africa. “I would definitely say that
Africa is a huge focus, especially with the latest success that we’ve had with the Massmar t por tfolio where we are now appointed as the facilities management company for Massmar t Africa, work ing across the whole of Africa, in all countries on the Massmar t por tfolio – that is a massive job. “ We do have a big focus on the African market currently. There are African countries like Ivor y Coast, Ghana, Nigeria, Kenya, R wanda, Uganda to mention just a few where there is positive growth and where oppor tunities exist to develop an established footprint quite quick ly,” he says. However, even with the company ’s success on the continent and its long-term
Refrigeration
success in South Africa, Broll has had to face some unique challenges that have been heightened thanks to the sluggish economy. UNIQUE CHALLENGES When the squeeze in the economy tightens thanks to fluc tuating interest rates, depreciating currenc y and slowing demand for produc ts and ser vices, financial managers will sometimes tighten the belt and look at areas where they can save money. “Unfor tunately in our industr y, the reality is that the first place that a CEO or COO looks to reduce expenditure is usually on the maintenance side; they tr y and push maintenance
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BUSINESS PROFILE
c ycles and make it longer, repair work is put on the back burner, we are asked to per form miracles with regards to keeping machiner y and equipment running for longer periods without huge expenditure so it ’s a huge challenge and we do feel the pinch on the operational side,” admits Aslett. Then there’s also the problem of smaller players being forced out of the market by the bleak economic climate. When people stop spending and the work dries up, small facilities management companies that are not set up to withstand economic pressure of ten fall out of the market, leaving their customers stuck . Aslett says that having smaller players enter the market for a shor t period of time and drop out when times get tough is harmful to the industr y. “My view, based on experience from various accounts that I’ve managed and been involved with over the last few
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BROLL FACILITIES MANAGEMENT
years, is that it ’s damaging to the facilities management industr y,” he says. “ The reason is that you get people that star t up a company, they run for a few years and they land a few smaller oppor tunities that could have been developed into much larger por tfolios but because of their lack of capacity they can’t do that. They then go under within three years and the legac y of that is that the industr y does not k now what they ’re doing and those clients will ver y seldom return to the market and in a lot of cases the client decides to insource and do the job themselves. I t ’s hugely damaging and the result is ver y negative on the industr y as a whole.” A slow market place, where the economy isn’t thriving, also paves the way for smaller companies to install ultraaggressive pricing and again this is not a positive thing for the industr y and its reputation. “ The economy has been an influence and in our par t of the
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BROLL FACILITIES MANAGEMENT
world it ’s worsened by conditions with the weakening of the R and against the Euro and the US Dollar. I t makes the net effec t of the shrink ing industr y even more vivid meaning that oppor tunities are fewer and fur ther between and fiercely competitive. I t opens up the tendenc y for companies to go ‘cut throat ’ which is also not conducive for longterm strategies and long-term relationships,” Aslett explains. SAVINGS WHERE POSSIBLE As Aslett mentions, CEOs and COOs quick ly look to their facilities manager to make savings when economic ac tivity slows. As well as saving on maintenance and repair work , there is also a demand to save
on energy and this is not only to manage costs but also to help companies deal with issues such as load-shedding and black outs. “ We are continuously asked to look at areas for saving when it comes to energy usage and also utilities such as water. There’s a big drive on the go with regards to utility management. There’s been a lot of effor t put into saving energy and I believe that we are ver y close to bottling out on those savings as most people have already installed the low- energy saving initiatives such as efficient lighting, efficient usage regimes and all that goes with reducing energy usage. There is light at the end of the tunnel as Eskom has a plan in place and they predic t that in the
nex t two to three years, there’ll be enough energy so that there’ll be no load-shedding. “For the last six months, we’ve had ver y little poweroutages so obviously something is going right but I hope that this doesn’t force our clients to lose focus on energy management possibilities,” he says. Unfor tunately, there is another big problem that has already impac ted on a number of businesses in South Africa and that problem is water. The droughts have caused catastrophes and of course Broll is look ing to help its clients where it can. “ We have a huge problem with regards to water. You cannot manufac ture water and rainfall
//R35 billion contracts valued at
//IT MAKES THE NET EFFECT OF THE SHRINKING INDUSTRY EVEN MORE VIVID MEANING THAT OPPORTUNITIES ARE FEWER AND FURTHER BETWEEN AND FIERCELY COMPETITIVE//
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BUSINESS PROFILE
//THE FOCUS SHOULD BE ‘HOW DO WE RESERVE, RECOVER AND RE-USE WATER THAT WE HAVE’ AND THAT WILL BE A FOCUS FOR US WITH UTILITIES MANAGEMENT GOING FORWARD// has considerably changed in the southern par t of Africa. Uganda is currently going through a huge drought period, our central region is going through a massive drought season so water is becoming the nex t big crisis. The focus should be ‘how do we reser ve, recover and re -use water that we have’ and that will be a focus for us with utilities management going for ward,” the
Direc tor: Technical explains. O f course, developing solutions to these problems and suppor ting clients who are themselves industr y leaders means that you need to develop a quality workforce, and with around 400 employees in SA and around 1400 on the continent, Broll has managed to create a sk illed and efficient workforce that offers quality ser vice.
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Developing this base is an ongoing task and something which Broll takes ver y seriously. PEOPLE DEVELOPMENT The Broll Academy was established in 2002 with the specific aim of improving proper ty sk ills and k nowledge of Broll employees. The Academy offers sk ills development for existing staff and learnerships and internships for new employees. “I t ’s ac tually a huge drive within the company and there’s huge suppor t for development of that facility,” says Aslett. “I t ’s an accredited training facility and it has a national training qualification framework rating so the people that attend our
BROLL FACILITIES MANAGEMENT
training courses receive a NQF rated cer tificate when they successfully complete the course. I t ’s not just a cer tificate of attendance like you might get with seminars and lec tures, it ’s ac tually NQF rated and taken ver y seriously. We’ve got 23 people currently on training through that school and they do their prac tical work in the Broll work place.” Going through the Academy is the per fec t route into a facilities management career and according to Aslett, there are oppor tunities for young people who excel to move into senior positions. “ The whole idea of having this set-up is to make that a reality,” he says. “ There are employees who have gone through the academy who work in junior management positions such as technical managers and facilities mangers. “ There’s one other company that I k now of that has a similar system but I don’t think they are NQF rated. There are a few private colleges which are affiliated with specific divisions, for example, our elec trical engineering fraternity has their own training schools but they are training on the technical engineering side and not so much in our line of business which is facilities management and the management of proper ty.” The Academy takes people from var ying different backgrounds, with different educational histories but Aslett explains that the most common entr y point is through South Africa’s technical colleges. “ There’s a lot of ways into it but the most common way just now is through technical colleges. We find that people
• • • • • •
Lighting maintenance Electrical maintenance Electrical installations and design Energy Efficiency Infra Red Reporting Supply of product and lamps
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www.centrelec.co.za //THERE ARE EMPLOYEES WHO HAVE GONE THROUGH THE ACADEMY WHO WORK IN JUNIOR MANAGEMENT POSITIONS SUCH AS TECHNICAL MANAGERS AND FACILITIES MANGERS// are sensitised at the technical college and then they come into our system and get earmarked for full-time employment,” he says. INDUSTRY BACKING The Broll Academy, and the wider ac tivities of the company, are suppor ted by the industr y as creation of jobs and development of sk illed people is only a good things for the sec tor. SAFMA
(the South African Facilities Management Association) exists to suppor t, represent and advance the cause and interests of the facilities management community on a sustainable and ever growing basis, and this organisation has for a long time suppor ted Broll and vice -versa. “ We see the relationship as ver y impor tant – so impor tant that for the last eight years,
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BUSINESS PROFILE
DIRECTOR : TECHINICAL CHRIS ASLETT
we’ve been a platinum member which is the highest membership you can get from SAFMA. Our COO, Rowland Gurnell, is one of the Direc tors on the governing body of SAFMA. We take our membership ver y seriously. A lot of our employees at management and junior management level are also members of SAFMA so there’s a lot of benefit that we get out of the association and they get from us,” says Aslett. “In 2015, we sponsored the SAFMA conference that was held in M idrand. We were one of the main sponsors and I think that shows our commitment to the organisation,” he adds. The mission of SAFMA is to be a self-sustaining body recognised locally and internationally for its meaningful role in facilitating
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BROLL FACILITIES MANAGEMENT
recognition of the South African facilities management community and Broll’s vision is to put clients’ needs first, solving their problems and identifying valuable oppor tunities to enhance their businesses so the two organisations are inter twined. “SAFMA is the only registered organisation currently where we can get facilities managers registered and accredited. There’s a validation that takes place and the facilities managers submit thesis’s to SAFMA and they then get a rank ing and that is nationally recognised – it ’s not just a piece of paper, you can use it for fur ther development and employment. I t definitely benefits us, without any doubt. “ We are also affiliated
with HEFMA (Higher Education Facilities Management Association of Southern Africa) and we are ac tive member of this association which includes all of the universities,” says Aslett. GROWING IN 2016 AND BEYOND Following on from the success of 2015, Broll is aiming to continue on the success path throughout 2016. At the end of last year, the company announced that it had secured new proper ty management contrac ts valued over R35 billion and buildings measuring over 1.7 million square metres. Group CEO, Malcolm Horne said: “ We are thrilled by these new contrac ts – our landlord ser vice businesses have shown growth across all regions on the continent in
//WE TAKE OUR MEMBERSHIP VERY SERIOUSLY. A LOT OF OUR EMPLOYEES AT MANAGEMENT AND JUNIOR MANAGEMENT LEVEL ARE ALSO MEMBERS OF SAFMA SO THERE’S A LOT OF BENEFIT THAT WE GET OUT OF THE ASSOCIATION AND THEY GET FROM US//
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BROLL FACILITIES MANAGEMENT
the last six months. Contrac ts secured will be taken up in the business over a phased period up to, and including April 2016. Our Africa business accounts for 23.3% of value and 12% of GLA.” And that positivity is backed up by Aslett who says that the spread of work is good and there are huge oppor tunities for fur ther growth with new and existing customers. “In our experience, the growth is a balance between commercial and retail. For us, at the moment we have quite a few commercial banks that we are engaging with regarding longterm relationships but we also have the Massmar t por tfolio and in-between the whole mobile telephone industr y. “ There’s a lot of growth in the
por tfolio. There’s the Vodafone por tfolio and then there’s our retail group with the Massmar t take on of the whole of Africa. “ We’ve entered into tender processes with a number of potential customers but they are currently in the open market and we haven’t had any definite response yet. We constantly par take in open tenders, recently we’ve submitted for some of the biggest banks in Africa and we’re constantly look ing to expand our brand within the facilities management industr y in the southern par t of Africa but also in Africa as a whole,” he says. Then there’s markets outside of Africa – other SA companies have realised the potential of global expansion, especially in the M iddle East and Eastern
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Europe. Could Broll be the nex t SA business to become truly worldwide? “ There’s a lot of projec ts that CBRE is busy with and for some of those, the southern par t of Africa is used as a springboard. Mauritius and Madagascar have projec ts under way and I do firmly believe that we can expand globally,” he concludes
BROLL FACILITIES MANAGEMENT +27 11 441 4000 info@broll.com www.broll.com
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SHELL SOUTH AFRICA
Shell Looks to Coffee to Fuel
Consumer Demand PRODUCTION: Joe Forshaw
Shell South Africa is perhaps the most recognised fuel brand in the country, if not the world. But positioning the brand as the frontrunner in the industry doesn’t come easily. The company is working hard to improve and increase its customer offerings and that has been demonstrated in the past few years by a thriving relationship with Vida e CaffÊ.
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BUSINESS PROFILE
//
Back in 2013 in London, England, a young entrepreneur started a business that saw him turn roast coffee beans into bio-energy. Coffee became a fuel and began to drive not only sleepy Londoners every morning, but also industrial boilers in large buildings. Coffee and energy have long been closely related; the caffeine-rich drink boosts your energy levels and keeps you focussed and awake. In South Africa, coffee and fuel have once again been closely linked and it’s thanks to two of the country’s most pioneering businesses in their respective fields. Instead of using coffee beans to create energy for generators, Shell South Africa and Vida e Caffé began a partnership three years ago that is now flourishing and providing quality fuel for South Africa’s people and their cars. Shell has a strong retail network of conveniently located service stations across
South Africa and Retail Marketing Manager, Yaasier Abrahams says that having service stations that are welcoming and able to provide a quality Convenience retail offer including a strong branded coffee, has bolstered the company’s appeal. “People’s lifestyles have evolved and consumers are looking for much more than just fuel when visiting a service station,” he says. “After conducting extensive research into the emerging trends in the South African market, Shell partnered with Vida e Caffé in 2013, as one of the strongest local coffee brands who were instrumental in establishing the coffee culture in South Africa over the past 15 years. Today Vida has over 50 high street stores outside of the Shell network and have become synonymous with a hip, vibey coffee experience entrenched in their AfroPortuguese heritage. “Over the past two years, Shell has
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invested significantly in refreshing its Convenience Store network and we’ve worked with Vida e Caffé to develop a fit for purpose format for the forecourt environment. Today we have well over 100 Coffee bars across the Shell network with the rollout set to continue across the Shell Select footprint over the next few years. “Vida e Caffé started in South Africa and it’s been a phenomenal success. Customers love it because they know they can get a quality coffee experience that they find in the high-street stores in more and more Shell forecourts across the country.” The ‘coffee culture’ in South Africa has lagged behind the rest of the world but in the last two years, an upturn has been reported. Stats SA report that coffee shops have seen a 7.1% increase in income since 2014 with impressive growth across the country.
SHELL SOUTH AFRICA
Vida e Caffé CEO, Darren Levy says that coffee is certainly on the rise: “There is a surge in the number of people who are drinking coffee and this is impacting on product awareness and product quality. Africa and South Africa look set to be superb spaces for growth for the coffee industry with plenty of opportunities for great providers of great coffee,” he told Africabusiness.com. Combining the quality product from Vida with the footprint of Shell has resulted in major successes for the business; Abrahams explains that feedback from customers has been positive. “It’s been absolutely phenomenal,” he says. “I thinks it’s particularly because the Vida e Caffé brand is so strong locally. We’ve not had Starbucks, and McCafe by McDonalds is probably the closest to an international chain of coffee shops competing with our local brands that we’ve had in the market.”
And Shell isn’t just catering to certain customers in certain demographics. Offering coffee that suits different schedules, different prince points and different tastes is very important to the company so it has worked with Vida to create a new brand that focusses on quality coffee to suit various tastes and affordability levels but also provides an innovative food menu. “We’ve also developed a secondary brand of Vida e Caffé called “Torrador by Vida e Caffé” and the Torrador brand gives you the quintessential coffee and experience but allows us to cater the food range to different trading environments given the positioning, equity, menu and price points of the Vida e Caffé brand. Depending on the trade areas, Torrador allows us to tailor the menus and price points to cater for things that suit the local market, particularly with regards to food,” Abrahams explains.
Tanker Services - 17years [144x100mm]P.indd 1
COMPLEMENTING EXISTING BUSINESS Many of the Shell service stations are home to Shell Select convenience outlets which offer 24 hours, seven days a week shopping accessibility. Select stores carry a range of standard convenience items and stock the leading brands so that you are guaranteed to purchase fresh, quality products. There’s also regular promotional offers that are always worth keeping an eye on. Interestingly, Abrahams says that since rolling out the Vida e Caffé outlets, the purchase of other convenience items and related products has increased. “Where we’ve put in the coffee shops, we’ve seen the basket size in the store increase and we’re also seeing an uplift in fuel volumes because we’re attracting more consumers from the
2016/04/14 10:31 AM
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forecourt into our stores. The customer is spending more time in the shop whereas before customers might have just come for a ‘fill and go’. “The good thing is that because the Vida e Caffé brand is so strong with local market, they’ve also developed a signature food range catering for breakfast, lunch and light meals that are appealing to the on-the-go consumers. If you look at the growth of the food category which has come with the Vida e Caffé experience, it’s been very encouraging,” he says. Vida e Caffé in Shell Select stores, the same as in its own stores throughout the country, largely offers a full serve barista style sales model. This strategy has proved hugely popular in other parts of the world and it’s no different in South Africa. However, Abrahams is also keen to explore a self-serve model to again cater for a
different segment of the market. “With Vida e Caffé, their traditional model is a full serve barista model and that’s what we’ve got across most of the network. For other sites, where you wouldn’t traditionally have a full serve barista coffee offer, we’re also looking to develop a self-serve offer – take a look at Shell sites in the UK; they all have Costa Coffee but they are all self-serve. “The full serve model makes sense as we’ve also got bakeries in our stores and with an energetic barista and freshly baked goods, the customers are very well catered for,” he says. RAMPING UP THE ROLL-OUT With over 100 Shell forecourts already home to Vida e Caffé outlets, Shell has plans to continue rolling out the partnership with a targeted approach for the rest of the network. This means that the quality coffee experience could soon be
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coming to a Shell Select store near you. “We’ve taken a phased approach through segmentation; we’ve looked at where coffee would make the most sense, looking at national routes, looking at where the busiest sites are in terms of commuter traffic and what the consumer baskets are across the network, and we’ve rolled out there first. The rest of the network is soon to follow,” says Abrahams. It is these offerings at the retail network that help set the business apart from its competitors (of which there is many) as the nature of the market for fuel in South Africa means that drawing people in with cheap fuel is not an option. “In South Africa, the fuels market is regulated so the pump prices for petrol across all competitors is the same and this makes it difficult to attract new customers apart from making sure that you have a very strong brand and that you can leverage your global assets. We’ve got
SHELL SOUTH AFRICA
a 113 year heritage in the South African market and some of our other strong assets are our partnerships and fuel endorsements. We’re a technical partner to Scuderia Ferrari and that’s a long-standing relationship which has been going on since the 1960s and this reinforces the high quality fuels perception,” says Abrahams. POWERFUL PARTNERSHIPS Away from coffee, Shell’s fuels are recognised as being amongst the best in the world. Along with the Ferrari technical partnership, another strong Global Brand in BMW M also recently endorsed Shell’s V-Power Nitro+ Premium Fuels in 2015. In the summer of 2015, to celebrate the BMW M V-Power Endorsement locally, Shell held a giveaway competition, offering five BMW 3-series to five lucky winners over five weeks. “Last year, BMW M-power endorsed
Shell V-Power Nitro+ performance fuels and our competition was an extension of that partnership in South Africa,” says Abrahams. “It had a fantastic response from consumers as the BMW and BMW M brands also have a strong heritage in the SA market and have a strong appeal with ordinary South African consumers. “We’re partnered with one of the strongest coffee brands in SA, we’ve got both the Ferrari technical partnership as well as the BMW M endorsement for our V-Power fuels, so you can see that we’re starting build a very strong and compelling CVP both instore and on the forecourt,” he adds. When people hear a name, they conjure up a set of impressions that influence how they think and buy, and those thoughts define a brand. All of the hard work being done by Shell in SA, building partnerships,
innovative marketing and offering quality service to customers, contributes to the building of a brand that holds significant weight with consumers all over the country and further afield. FOOT ON THE GAS As a global company, headquartered in the UK and the Netherlands, Shell is constantly on the growth path. Currently, the growth and investment situation in the energy industry is not conducive to large scale advancement thanks to slumping oil prices but nevertheless, Abrahams is confident about the future of the South African market place thanks to an emphasis on investment into both new and existing infrastructure. “Obviously, we’re looking for opportunities to grow all the time,
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SHELL SOUTH AFRICA
// 100 Coffee Bars Today we have well over
particularly as South Africa has a growing population and a growing economy. We’re certainly looking to expand and also reinvest in the existing network so our strategy is to look at how we can enhance the offers at the existing sites and make sure that we offer South African motorists a welcoming customer experience whenever they visit a Shell forecourt. “South Africa is seen as one of the growth markets for the Shell group,” he says. “The group has taken a long-term view on the future of South Africa and recognised that this is one of the markets that is going to be seeing growth and where it can realise a good return so the investment is definitely there. Given the fact that we have invested in the network already, we’ve shown that that is helping to sustain the business within the country. With the investment in enhancing our Convenience Retail Offer in addition to our strong and established fuels portfolio, we’re doing our best to ensure that our customers keep coming back,” he concludes
SHELL SOUTH AFRICA +27 11 996 7000 info@southafrica.shell.com southafrica.shell.com
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SANSA
Is Space Weather
Affecting Your Business?
PRODUCTION: Manelesi Dumasi
The South African National Space Agency continues to monitor the effects of space weather across the continent. Its work is perhaps underappreciated but it is now searching for growth and looking to help integrate spaceknowledge with government decision making, for the benefit of SA society.
//
You might not know it, but your business has and will potentially be affected by space weather. Space weather is a scientific field that has been studied for many years, but its nature and effects are still not fully understood. It is defined by Natural Resources Canada as: “A collection of physical processes, beginning at the Sun and ultimately affecting human activities on Earth and in space. The Sun emits energy, as flares of electromagnetic radiation (radio waves, infra-red, light, ultraviolet, X-rays), and as energetic electrically charged particles through
coronal mass ejections (CME) and plasma streams. The particles travel outwards as the solar wind, carrying parts of the Sun’s magnetic field with them.” In South Africa, monitoring of space weather and utilising information to predict and prepare for its effects is a task that falls to SANSA – the South African National Space Agency. The modern-South Africa is now well-known for its capabilities in science and technology and this has helped SANSA to grow and develop internationally recognised know-how; know-how that space agencies from
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all over the world want to share. SANSA recently hosted representatives from the Met Office, Mullard Space Science Laboratory, RAL Space, and Imperial College London in the UK. The visitors met with SANSA researchers to discuss a multinational space weather project as part of the UK Space Agency’s International Partnership Space Programme (IPSP). Critical national and international infrastructures, such as power grids, transport, communications and financial services specifically, are at risk from the adverse impact of space weather. Governments in several countries, including the UK, are now factoring these risks, along with those caused by natural hazards, into risk management programmes.
“SANSA will contribute knowledge on the impacts of space weather on crucial infrastructure such as power grids and the country’s diverse range of technological availability and high dependence on mobile technology, as well as its ground-based spaceweather monitoring infrastructure that could enhance services provided by other nations,” said Dr Lee-Anne McKinnell, SANSA MD. The IPSP, which will help to determine the socio-economic impact of the consequences of space weather and also build capacity in developing counties to contribute to the international space weather ‘problem’, is well received in South Africa and SANSA’s Corporate Communications Manager, Vaneshree Maharaj explains
more about what the state-owned company is offering. “If you look at space weather technology currently; the prediction of solar flares has improved,” she says. “We used to be able to predict where they would impact the earth anywhere between four hours and four days in advance; now it’s more like at least five days. You can take power grids off or put in damage control and that is what technology is helping us do. It’s even being integrated into policy for our Navy and Air Force and communication systems as all of this can be impacted by solar weather. “Globally, the technology is moving so rapidly that we could eventually predict where solar
//SCS SPACE AFRICA NEEDS SATELLITES FOR GROWTH AND PROSPERITY
“The satellite remote-sensing industry is set to become an indispensable component of smart governance and economic development in Africa to ensure growth and prosperity for all the peoples of the continent,” says Dr. Sias Mostert, CEO of Space Commercial Services Aerospace Group (SCS AG), Africa’s leading private space company. “Governments agencies and private companies can now have a sufficient volume of reliable, dependable, real-time high-quality data obtained through satellite imagery to support a wide range of services such as crop assessments, forestry management and deforestation, environmental protection, fire warnings, infrastructure monitoring, urban and rural development, population counts, border control and maritime security. Through technology advances from the SKA project, SCS AG can now apply the latest big data technologies to provide advanced business intelligence. Adequate data is available for these applications on a continental scale through the recently announced SCSGi Africa Satellite
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Constellation of ten of the best international satellites combined for priority utilisation over Africa. Services are available through integration into enterprise management systems or via an online ordering system which makes it easy for customers to order their data. “On top of this it is feasible for a country to invest in the long-term innovation economy of a country by investing in a satellite engineering program that will contribute future satellites to the African Satellite Constellation. Through advances in micro-technology it is feasible for a team of engineers from a country to learn how to build a satellite that will contribute key data to applications of continental interest. SCS AG has the satellite engineering heritage to offer complete turnkey satellites and support local national satellite teams to execute such a project. The use of the SCSGi African virtual satellite constellation makes it possible for processes to be monitored in hours, minutes and seconds, instead of days. See http://www.scsgi.com for more information.
SANSA
weather events are going to occur and possibly the extent of the damage. We could then put out early warning or try and mitigate.” And the technology being developed by SANSA and its partners, and the applications that are now available are not just helpful with space exploration and space weather monitoring, they’re also extremely useful in ‘earth observation’, weather prediction and other observational tasks. Following the droughts which have plagued the country since the third quarter of 2015, the SA government tasked SANSA with developing an application that could assist in the overall care of the situation as well as provide ad-hoc information to other government departments. “The drought monitoring system came out of a need from government,”
explains Maharaj. “They needed tools and information because the drought impacted our entire population. Apart from just giving the government the data, we’ve created tools and applications and provided training for their staff on how to utilise the tools so it’s all addressing a critical need. We also provide a national mosaic of the country which is given freely to all government departments and they use that for various things including infrastructure development, looking at the growth of informal settlements, where proper housing is needed, looking at our power lines and this helps the housing department and also Stats SA. Space is becoming integrated in the government’s toolkit for making decisions and starting projects but we could be doing so much more,” she says. Of course, just like any scientific
//WE USED TO BE ABLE TO PREDICT WHERE THEY WOULD IMPACT THE EARTH ANYWHERE BETWEEN FOUR HOURS AND FOUR DAYS IN ADVANCE; NOW IT’S MORE LIKE AT LEAST FIVE DAYS// organisation, funding remains an issue for SANSA and the business will look for ways to boost its funding in the future but right now it continues to work closely with international partners, both in Africa and further afield, to leverage existing assets. “We download data from a few
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Increase your reach through satellite technology E: info@scshgroup.com T: +27 21 300 0060 F: +27 21 300 0064
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BUSINESS PROFILE
satellites from the French CNES, where we have six or seven, we download from NASA’s Landsat 8, and we also have agreements the Chinese where we can access the data but not download,” Maharaj explains. “We download at our space operations facility at Hartebeesthoek and that is for the purposes of our earth observation division. They process, analyse and create applications from that data for our stakeholders who are government departments, SOCs and private customers who all use SANSA data for a wide range of activities. “We are currently part of the ARMC (African Resource Management Constellation) agreement which includes SA, Nigeria, Algeria, Kenya,
and possibly Egypt in the future, and we all contribute observation satellites. We often buy data, which is very expensive, so in the Constellation we can have a greater revisit time over the continent and we can share this information with people on the continent. “We also partner with Ghana where we have a radio antenna, we do a lot of training of governmental employees across Africa concerning water management through the TIGER project, we’re developing capacity on the continent and we also have a regional space weather centre which is monitoring the sun and in the event that Africa would
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experience any adverse solar activity, they would be able to contact the continent,” she says. All of this work is vital, not only for the SA government and various other stakeholders, but also for businesses on a much wider scale. Unusual weather, extreme conditions, solar flaring etc can all have an impact on the day-to-day and people need to be aware of this. This is why the SANSA and the government are trying to integrate the work of the agency with overall government policy and decision making - empowering people through technology. “ The major area of focus right now is our earth observation
SANSA
© SANSA
program because it plays a critical role in the governments National Development Plan and because we’re government funded, our priority and our biggest stakeholder is society in South Africa,” explains Maharaj. “Using our data, we’ve produced a number of applications like the drought monitoring system because we’re experiencing that extensively now. Food security is also a concern along with accessing water so our system is available to the government and its departments for the greater good of the country. We also do a lot in terms of disasters; we go through these seasons of fire, flooding and
drought so our systems track that. We are making progress in terms of our satellite to contribute to ARMC but that’s a big impact project as it’s not just an ordinary satellite; its developing capacity and developing the space industry. “We want to invest in infrastructure and train people so that more businesses can supply the space industry, not only locally but also in Africa. Funding is the only delay in this as it’s very expensive but it’s a big drive and it forms part of the National Space Program,” she says. We will hear more next month about the plans that SANSA has for boosting its funding and the work
that goes into training people. As the agency targets growth, perhaps now is the time to think about how a major space weather event could affect your business – are you prepared? Are you even aware of what could happen and why? SANSA can answer these questions; this is one of the SOCs that is run purely to serve SA society; now would be a great time to show support
SANSA 012 844-0500 information@sansa.org.za www.sansa.org.za
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SOUTHEY CONTRACTING
A “One Stop Shop” Solution for
Prolonging
the Lifecycle of Industrial Assets PRODUCTION: Karl Pietersen
Southey Contracting has a long and proud history in South Africa and through training, development and the delivery of quality service, the company is preparing for a fruitful future. Managing Director, John Humby tells us more…
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//
You can often tell a lot about a business by looking at its history – how long it’s been around for, how much it has achieved and whether it continues to perform well and shows the ability to cope with change. In South Africa, there are many companies involved in the mining business that have opened and closed very quickly, there’s many that have not stayed on top of technology, there’s many that have failed to keep employees happy and there’s many that have simply not evolved strategy over time and have been left behind. Because of the rapid change in the business and technology
environment, it’s so important to constantly review all aspects and plan for every eventuality whether it’s a slowing economy, a natural disaster, an increase in competition etc, you have to be prepared. This is especially important when you operate a multi-discipline company that offers a large portfolio of services to customers across a range of industries. You must understand each sector that you work in, you must tailor your offerings and never become ignorant of the needs of customers. Southey Contracting (Southey) was founded 77 years ago and throughout its history it has changed and adapted its strategy,
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bolstered its service offering, expanded the number of markets in which it operates and built strong relationships with customers and suppliers, and this has helped the business to become an industry leader. Southey Contracting is part of Southey Holdings – the ‘investors in excellence’ - a multi-disciplinary business that owns a diverse range of companies, all focussed on servicing the mining, minerals, oil and gas, power generation and general industrial industries. John Humby, Divisional Managing Director at Southey Contracting tells Enterprise Africa more about the journey from a
SOUTHEY CONTRACTING
//WITHOUT OUR TRAINING STRATEGY, WE WOULD BE STUCK SO WE SEE IT AS A VALUE-ADD. WITHOUT IT WE WOULD NOT BE SUCCESSFUL// small business started nearly 80 years ago, to a 3500 employee international organisation. “The company was formed in 1939 to provide painting and insulation services to the mining industry throughout Southern Africa, particularly the northern regions of South Africa,” he says. “It grew with the development of the gold mining industry in the Free State; that was in the late 70s and early 80s at which point it had been bought by two trusts which decided to expand the field of influence from Johannesburg and
branches were opened in Durban and Cape Town. It remained a primary supplier of scaffolding, painting and insulation services to mining and also sugar, paper and pulp, refineries, oil and gas, marine, general steel construction and power generation industries. In the late 90s, we then purchased a couple of other companies. One was IMAC, then there was Okapi and Rudnev. Okapi is an agricultural knife manufacturer, IMAC is a marine and ship repair company and Rudnev is a cold room manufacturer so they were all
loosely related. “In the early 00s, IMAC joined with Dorbyl Marine and made DORMAC of which we were a 50% shareholder and in 07/08 we purchased the remaining 50%. The company then also bought the Parkhome manufacturing business as well as a company called Concord who manufacture refrigeration cabinets for the retail industry and that’s the basis of the group as it stands today. “The contracting division which started everything, has grown to provide a number of other services like scaffolding, high pressure water-jetting and cleaning as well as aluminium spraying. The services of the contracting division are provided throughout the country as well as into neighbouring countries in Southern Africa including
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BUSINESS PROFILE
Namibia, Angola, Zambia, DRC, Kenya, Mozambique, Botswana, Tanzania, Ghana, Cameroon, Guinea etc so we have quite the influence in Southern Africa and beyond. In 02/03, we bought a company called Tate & Nicholson which is a steel sheeting division who are one of the top companies in the country when it comes to roofing sheeting. “ The group is now quite big and prides itself on service delivery, fantastic safety records and superior training of staff,” explains Humby. Southey’s main offerings come in the form of asbestos removal, corrosion protection and coating, fireproofing, floor coating and concrete repair,
industrial cleaning, insulation, scaffolding and access, sheeting and cladding, surface preparation and thermal metal spray. These services can extend the lifecycle of assets in industrial applications. They are also hugely useful during the building of new assets, during maintenance, shut downs, modifications and decommissioning and return to service projects.
THE COST OF TRAINING Obviously, all employees at every company around the world need training to ensure they are schooled in what is expected, what is safe and what needs to be done to satisfy the client. Even the most high profile jobs need training – Queen Elizabeth has been quoted as saying “It’s all to do with the training: you can do a lot if you’re properly trained.” American Entrepreneur, Nolan Bushnell said:
//WE PROVIDE INPUTS AND DELIVERABLES THAT THE CLIENT IS LOOKING FOR AS OPPOSED TO IMPOSING OURS ON THEM AND I THINK THAT’S IMPORTANT//
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SOUTHEY CONTRACTING
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“Hire for passion and intensity; there is training for everything else.” Because of the nature of the Southey business, with some activities being dangerous, training is extremely important. Humby explains that effective training forms part of the company’s overall business strategy. “We spend a significant amount of money on training; it’s vital to our business,” he says. “Without our training strategy, we would be stuck so we see it as a value-add. Without it we would not be successful. The HSE side is vital when ensuring competence in employees and the more competent they are, the less monitoring we have to do. We are IMS, ISO 9000, ISO 14000 and OHSAS 18000 rated so we have the basics intrinsically in our business but it’s about ensuring compliance in the long-term.” And it’s not just the front-line that needs upskilling; people throughout the business need development in certain areas and this is an ongoing focus as staff turnover is something which is inevitable for a company like Southey. “We have to train our staff at all levels. The upper management are typically degree-educated professionals but we have a big gap in project management skills, people coming into that area are not properly educated with relevant skills so we have to provide that. Lower down in the organisation, the artisans and semiskilled workers often require extensive training and that’s because there isn’t always continuous work for people, it’s sporadic. We do a lot of training with people who are then let go at the end of a project and they then find themselves in other areas where they’re not working in related trades and we have to bring in new people and train them again,” explains Humby. Interestingly, Humby explains that the needs of the business are not always the foremost factor when making a decision on training. Meeting the needs of the employees is also key to achieving certain outcomes. “We have some excellent training
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facilities but you do have to be aware of the quality-level of training provided by external training companies - that’s always a challenge that needs to be managed. We do a lot of training internally and selecting our training providers very carefully so that we get good value for money and, most importantly, the employee gets the best training possible,” he says. EXPERIENCED RIDING ECONOMIC WAVES In the past 77 years, the SA economy has most certainly had its ups and downs and Southey has remained a constant throughout. Today, the economy is yet again covered by dark clouds but the experience and knowledge that the company has gained place it in a strong position to continue pushing for growth, despite the situation in other industries.
//IT’S ALL ABOUT RISK MANAGEMENT AND ENSURING THAT THE RISKS ARE AS LOW AS POSSIBLE WHILE MAINTAINING MARKET SHARE AND PROFITABILITY// “I wouldn’t say we’ve been around long-enough to know what to do, I don’t think anyone can say that, but we know what is continuous, where the areas of growth are and we’ve positioned the business so that we can take advantage of growth,” explains Humby. “We’ve avoided areas of sporadic growth and contraction. At the moment, while Southey was founded on the mining industry, our exposure to that business is very small. Oil and gas and power generation is definitely a focus despite its short-term issues. “We are well positioned under
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the current circumstances and that’s through planning and analysis of where we stand and what is out there. It’s all about risk management and ensuring that the risks are as low as possible while maintaining market share and profitability. You can never be entirely negative and you have to take opportunities when they come up,” he says. Opportunities that the company has taken up are those in the oil and gas business. Sub-Saharan African nations, mainly Mozambique, Angola and Tanzania, have offshore reserves that have been described as ‘potential
SOUTHEY CONTRACTING
game changers’, South Africa is on the cusp of introducing a shale gas industry and Ernst & Young have named Africa as a whole part of the ‘new and emerging markets’ group in the oil and gas industry along with Russia, Mexico, the Arctic, the Middle East and Asia. Southey Contracting’s offshore division provides services including corrosion protection, UHP water jet blasting, abrasive blasting, tank cleaning, scaffolding, thermal insulation, non-destructive testing, material inspection services, lifting gear certification, maintenance and engineering solutions, unique access solutions and marine crew assignments and this is a growing business for the group. “In South Africa right now, we are working a lot in oil and gas and power generation. North of our borders, mining remains a primary focus. We are also targeting the power generation industry in those areas as Africa requires a lot of power as we move forward so there’s going to be a lot of development that we want to be a part of,” says Humby. A MODEL FOR SUCCESS Because of Southey’s unbridled focus on delivering quality service and its ability to adapt and meet the ever-changing needs of demanding clients, it has developed a model for success and this is something from which other could learn. “Sometimes I say that we pride ourselves on the lack of length in our debtor’s book meaning that we don’t have many debtors. We have a small client base but they are clients that we have built relationships with over a very long period of time and they know they can trust us and they know they’ll get the service and quality that they require,” explains Humby. “For example, there’s a fuels company that we work with on maintenance projects and we know that we’re not
the cheapest but they’re very happy with the level of quality, safety performance and on-time delivery. What we do is try and adapt our business to suit their needs so that we can understand them and talk their language. We provide inputs and deliverables that the client is looking for as opposed to imposing ours on them and I think that’s important.” As the ever-increasing reach of the company continues to stretch further across South Africa, the African continent and even the Middle East, it looks like this business will go from strength to strength. As development on the continent speeds up and the need for energy and industrial services advances, there will be huge opportunities for Southey, and with
its knowledgeable and experienced management team backing up its vast employee base and service portfolio, the future looks extremely bright. The next step is to continue developing people and nurturing relationships with existing clients but also remaining vigilant in the market and looking out for new opportunities and with new contracts expected to be announced in the near future, Southey’s position remains as solid as ever
SOUTHEY CONTRACTING +27 11 579 4600 gauteng@southley.co.za www.southeycontracting.com
Delivering relevant and practical solutions to the most demanding commercial challenges T: +27 11 648 9500
E: info@mdaconsulting.co.za
www.mdaconsulting.co.za
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FOSKOR
Investments Into New Plant Set to
Stabilise Foskor PRODUCTION: Manelesi Dumasi
Foskor is a proudly South African producer of phosphates and phosphoric acid with international exposure. Thanks to ageing plant and declining global commodity markets, the company has seen difficult times but with big planned investments on the horizon, the future is looking bright…
//
It’s well known that times in mining and commodity markets are difficult right now. The situation in global markets has changed dramatically in the past few years and this is largely down to a confidence crisis in Chinese financial sectors. The situation in some areas is so bad that even the biggest companies have not been safe. Take Peabody Energy for example, the world’s largest coal miner announced that it had filed for bankruptcy after the commodities price collapse. In South Africa, a country built on mining, falling prices are already causing trouble, despite the favourable export conditions with the recent depreciation of the Rand. In February, the mining sector recorded the worst figures in three years, contracting by 8.7% year-on-year, a much higher figure than even the pessimists predicted. This contraction has paved the way for new claims that the country could be facing recession. But even with all the negativity, there are companies that have remained positive and decided to be optimistic and enthusiastic
about the future, and not get caught up in short term problems. A good example is Foskor, the country’s producer of phosphates and phosphoric acid and the only vertically integrated phosphate producer. The falling commodity price has hurt Foskor but instead of getting stuck in a rut, the company has announced a large-scale investment into its equipment and plant with the aim of revitalising the business and improving reliability, availability and efficiency. The company holds a strong position in the market, it has built fruitful and longstanding relationships with companies all over the world and with this new investment it is looking to improve its business case from within in the coming years. One relationship which has been fertile for Foskor over the past 16 years has been with German company Loesche who installed an innovative mill, the VRM Type LM 50.4, back in 2000 at Foskor’s Phalaborwa site. Foskor’s Senior Manager Project and Strategy, Shivaji Gadhave says that this type of outlay is indicative of the company’s strategy and bold approach to investment.
“In 2000, we commissioned that Extension 8 plant. Before that we were using a ball mill or traditional mill. Our team visited the site and tested material before submitting the feasibility report. It was a courageous decision at that time as that type of mill had not been used in the phosphate industry. “Whenever you try new things there are challenges and we worked hard with Loesche on this. This mill was not designed for the phosphate industry but we’ve seen improvements in performance since using the technology in this mill,” he says. Foskor will hope that its future investments are as successful as this. The Loesche mill is suitable for hard rock processing, can be fitted with wear resistant products, uses low steel consumption compared to conventional milling and provides a better ore liberation compared to conventional milling. For the next three to five years, one of the main focus areas for Foskor will be upgrading ageing plant and Gadhave is confident that this will be of huge benefit to the company. Continues on page 48 >>>
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BUSINESS PROFILE
//LOESCHE 16 YEARS OF SUCCESSFUL OPERATION OF A LOESCHE VERTICAL-ROLLER-MILL TYPE LM 50.4 IN A 25 KWH/T BWI HARD ROCK APPLICATION FOSKOR PTY (LTD) IN PHALABORWA In 1999, Foskor has decided to increase their production capacity to cater for the increase in phosphate demand. During the project design phase, it was decided to install a Loesche Vertical Roller LM 50.4 mill instead of the conventional rod and ball mill technology. Extensive research at the time of the projects has revealed that the mill can be erected 30% cheaper than conventional milling process and a 25% smaller footprint is required compared with a plant of similar capacity. Due to the inherent operating flexibility of the VRM, better grand control can be applied by adjusting the feed rate, bed thickness, hydraulic pressure on the bed, air flow and speed of the classifier. Comparative grind analysis in pilot plant test between the VRM and the conventional mills were conducted and it was concluded that the VRM provides much better differential milling and mineral liberation resulting in better flotation recovery and concentrate grades. The Loesche Mill grinds Pyroxenite Phosphate Rock from - 90mm to a flotation feed of 85 weight.-% passing 425µm (P85=425µm). The annual production averages to 505 t/h of the hard-to-grind ore (Bond Work Index: 25 kWh/t). Despite of the abrasive ore to be processed, the Foskor team achieves a plant availability of 94% by executing appropriate preventative maintenance. In 2010, additional wet milling capacity was added to the plant. The parallel operation of a dry Vertical-Roller-Milling process and a conventional wet Rod and Ball Mill allows the first comparison of these technologies in a hard rock application. A sampling campaign in July 2014 compared the actual grinding and flotation performance between the two circuits and has revealed that the VRM provides: • • • •
Better control over the process and hence consistently better product quality Higher process flexibility which allows to operate the mill in an on- and of-mode according to the production targets which is not be possible with the wet milling circuit Faster adjustment of the process stability and product quality in case of mineralogical changes Better mineral liberation at reduced ultra-fines production resulting in higher recovery and concentrate grades in flotation
A recent comparison between the VRM and the Rod / Ball mill revealed that the VRM consumes only 3% of the grinding media steel compared to the Rod / Ball Mill (4.32 g/ton vs 143 g/ton). Besides the benefits in form of lesser iron contamination of the ground ore for the flotation this also leads to 35% cost savings per ton of ore ground. As part of continuous improvement Loesche and Foskor joined hands and are busy developing a new generation modular air classifier with improved wear resistance and maintenance options which will be installed 2017. Loesche wants to thank the Foskor team for proving that the Loesche Milling technology is successfully applicable for hard rock applications. Loesche is looking forward to continue the joint improvement of the plant performance between Loesche GmbH and Foskor Ltd..
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LOESCHE VRM TYPE LM 50.4 – 16 YEARS SUCCESSFUL OPERATION
IN A HARD ROCK APPLICATION AT FOSKOR PTY (LTD)
BUSINESS PROFILE
SHIVAJI GADHAVE HEAD OF STRATEGY AND PROJECTS
<<< Continues from page 44 INVESTMENTS & UPGRADES Foskor has a 65 years heritage in South Africa and, as with any company that utilised heavy industrial machinery, the time has come for a significant upgrade to allow Foskor to remain competitive. “We have some plant that is around 40 years old so we now have the requirement to replace a portion of the plant in the Acid Division in Richards Bay. We have had the funding approved from our shareholder, the IDC, for the acid equipment last year and we have initiated the project. “What the project is going to do is improve the utilisation of plant, the reliability of the plant and the efficiency of the plant – currently because of the age of the plant, we are struggling with these parameters. “This investment is between R3-4 billion,” explains Gadhave.
“It will definitely be positive for us in the future and we are quite excited. We are doing everything in house and as we require we are going to source contracts and consultants depending on their expertise and contribution. It’s completely funded by our major shareholder, the IDC. “There will not be a single partner. Depending on the different part of the plant there are different levels of expertise available in the market, so there will be several partners, several construction consultants and partners who will help us to implement this project for the next three to five years,” he adds. The company has had success recently following upgrades and benefits from that investment are already showing. “In December 2014, we replaced
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some of the major plant in our mining division. This was a R550 million investment and is currently running successfully and has helped protect our production capacity in the mining division as the old plant was no longer fit to run properly,” says Gadhave. The R3-4 billion investment is going to act as a catalyst for growth for Foskor as it’s clear that the ageing plant has been the source of many problems for the business. PRESSURE ON PRICE “There is certainly downward pressure in the market on pricing and currently we are struggling with efficiency issues and availability of plant so the situation is difficult but there are opportunities and soon the situation is going to change and we will make profits,” says Gadhave.
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BUSINESS PROFILE
Economic phases are cyclical and slumps are followed by peaks. If we assume that the falling global commodity prices will eventually stabilise and rise, Foskor will be well positioned to take advantage of new opportunities. “We have seen a reduction in our market share but the major contributor to that is our old plant as we cannot produce at the level we were producing before. Our quality is still the best in the market, we have good customer relationships so I think that the market is not responsible for our reduction in share, it’s to do with our internal issues surrounding the age of our plant. “The quality of our rock is among the best in the world. It’s the same with our phosphoric acid – it’s world class. If there is a customer looking for phosphoric acid and our acid is available at the same price, customers will go for our aid as there’s less impurities and our acid is good for niche markets. We have a quality
advantage and excellent customer relationships,” explains Gadhave. Commodity pricing has also been effected by unpredictable events that cannot be planned for. Because of the close link between phosphate and farming, events such as droughts are hugely damaging to the supply and demand situation. “Phosphate is a commodity but you can’t generalise and group with other commodities because it is mainly used in fertiliser so it’s closely related to the farming industry. There are others uses in the food, pharmaceutical and animal feed industries but the main use is in farming. There is currently a drought in South Africa, there’s a drought in parts of India and India is the largest consumer of phosphoric acid and fertiliser so with the drought and with changing government policies there is a downward trend in price of phosphate,” says Gadhave. “It’s a temporary cycle and we’ve seen it in the past. Things always go
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down and then come back up. We are geared up to survive in this is economic cycle. Currently, there is no crisis for us – we’re not going for a reduction in production or retrenchments so we are surviving and I’m sure the future will be bright. “Returning to profit is one aim and the other is sustainability. The current plant has completed its useful life so we cannot expect much more from this plant. New plant will mean sustainability and improved efficiency and that improves cost of production,” he adds. GROWTH & DEVELOPMENT Following the installation of the company’s new plant and the upgrades of machinery, Foskor will be looking to grow in terms of profits and markets served. “We always think about our country and our continent so one of the initiatives from our side is to contribute to the SADC market and
FOSKOR
//R3-4 billion investment
grow our business there while looking for strategic alliances where possible so that we can penetrate those markets,” says Gadhave. “We also have strategies to increase our product basket. We want to add value and move into downstream products and we are planning to diversify our business to reduce risk and ensure everything is financially sustainable. “We are still focussing on our South African market and there are advantages here for us. We have long-term relationships and established logistics so we are well positioned in local and international markets,” he adds. The business is also focussed on developing its most valuable asset – its people. Foskor was awarded Top Employer status in 2016, an award that has been bestowed on the company many times before, and this accreditation demonstrates that Foskor offers ‘exceptional employee conditions, nurtures and develops talent throughout all levels
of the organisation and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and to develop its employees’. Gadhave, who joined the company in 2010, is the perfect example of how an employee has been nurtured. “I am a mechanical engineer and a registered and certified project management professional in South Africa. I joined as a project engineer in the mining division and I climbed the ladder and I am now heading up strategy and new business development. “Foskor offers fantastic career development opportunities and shows confidence in its staff,” he says. Development of staff forms one of the pillars of Foskor’s strategy – it’s not all about profit. Part of the company’s mission is to ‘earn the respect of stakeholders’. “We have a mechanism in place where we engage with not only employees but also the local community. Foskor is a company that has the IDC as a majority shareholder and that means that
we are not only driven by profit making but also by community development, empowerment, small business development and economic growth,” says Gadhave. “We have the internal problem with our old plant as well as the downward pressure from the market on prices and so in the last couple of years, we haven’t made huge profits so it’s difficult to continually offer bonuses. “We had a temporary problem but now everyone is motivated and everyone is giving their best effort to assist in the turnaround of the company,” he explains. In the long-term, the investment into new plant is likely to be one of the biggest decisions Foskor has ever made. With the markets the way they are, always unpredictable, the pressure is on this sizeable business to perform well. Fortunately, Foskor’s people are committed and its partnerships and products are solid. “To remain in the market you must be a profitable business but we do have other objectives and we want to emphasise this as much as possible,” says Gadhave. This is going to be an interesting few years, and Foskor is certainly worth keeping an eye on
FOSKOR +27 11 347 0600 abbyl@foskor.co.za www.foskor.co.za
www.enterprise-africa.net / Issue No.47 / 51
NALEDI RAIL ENGINEERING
The Rising Star in an Industry Revolution PRODUCTION: Karl Pietersen
Over the next few years, we are going to see more and more investment into Africaâ&#x20AC;&#x2122;s rail industry. There is a real desire from individuals, businesses and governments to jump start one of the most important transport industries in any major economy. Naledi Rail Engineering is making things possible - this is company powering towards successâ&#x20AC;Ś
www.enterprise-africa.net / Issue No.47 / 53
BUSINESS PROFILE
//
“Globally, rail is seen as the backbone of any transport system,” says Dr Jackie Mphafudi, executive chairman of Naledi Rail Engineering (NRE). However, in South Africa, the rail network has been somewhat neglected over the years falling victim to decades of underinvestment. In 2011, a government study found that most of the country’s passenger coaches were more than 35 years old. Today, other forms of transport, especially road, are favoured over rail, and the government has identified this issue as one which must be addressed. In the last ten years, a number of huge announcements have been made aimed at revitalising this ailing industry and NRE, similarly to many other local and international companies, has positioned itself to answer the call when it comes to manufacturing and design of coaches,
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NALEDI RAIL ENGINEERING
//WE THOUGHT OF USING THE NAME NALEDI WHICH MEANS ‘STAR’. THERE’S A SMALL DISTRICT IN SOWETO CALLED NALEDI AND A TRAIN STATION CALLED NALEDI AND WE WANT TO BE THE RISING STAR// signalling solutions, infrastructure management, perway, quality control, and all other areas associated with the upgrading of the country’s rails. And it’s not just South Africa that is investing in rail. As the middle class grows across the continent, and as manufacturing nations such as China constantly require an inflow of raw material commodities, there is a growing need for infrastructure, especially rail, to move people and goods quickly and efficiently. Because of this development, NRE is uniquely positioned to service
a growing industry using knowledge that has been created, customised and perfected in South Africa. NRE CEO, Wahed Rasool says that the industry is in a good place and investment is not lacking, despite the economic challenges that hang over the country. “The industry is thriving, without a shadow of doubt. South Africa has invested in what had been an ailing industry with little or no investment in the last three or four decades so there has been a backlog which we have acknowledged and started investing in both passenger and freight, and port
and rail operations. “We are a mining nation and there are many commodities that we export so freight rail and port infrastructure is important. To move any economy, you need to be mobile and have mobility as a key driver,” he explains. “In 2010/11 the Department of Transport held an international conference in Cape Town and received overwhelming feedback and that is what led to the tender for new rolling stock. At the time, that tender was the largest single rail rolling stock project in the world at about R130 billion. It attracted all OEMs from all over the globe. “In SADAC and the rest of Africa, there are similar investments happening in countries like Mozambique, Namibia, Zimbabwe, Zambia, Tanzania and others. They’re also mining nations that need mobility and need their
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BUSINESS PROFILE
commodities taken to port so Africa as a whole is dependent on investment into rail infrastructure. “The AU took the decision that South Africa should be the hub for all manufacturing of all rolling stock on the continent which places SA at a vantage point when it comes to capabilities. The AU has now started refocussing on that commitment meaning that the capacity in SA needs to be accelerated and needs to be at a level where we can deliver international products and services to the African continent, especially with rolling stock,” says Rasool. Most of the international OEMs now have a base or partnership in SA including GE, Siemens, Alstom, Bombardier, Thales, Ansaldo, Stadler, ABB, Knorr-Bremse and many more. “The future is looking very bright from a rail manufacturing perspective as these projects are medium to long-term. For example, the Alstom contract is a ten year contract for the delivery of 3600 coaches, then there’s maintenance that goes for 18 years beyond that. “The rest of Africa such as Egypt, Morocco, Tunisia and others has major
rail projects underway; the Middle East and India is spending money so from an investment and spending perspective things are very exciting,” Rasool explains. NRE has already set its sights on big projects taking place across the continent. In particular, there are interesting developments happening in East and West Africa as well as on-going development in sub-Saharan Africa. “We cast the net as wide as possible,” says Rasool. “The French speaking countries in North Africa have major projects, however, we are close to other mega projects that are taking place. For example, Senegal. They want to install something similar to what we have in Gauteng with the Gautrain. Thanks to our partnerships on the continent, we have been linked to that project with a major construction company that will undertake the work. That’s a multi-billion dollar project and there are others taking place; in Tanzania there are new lines being built to the port of Mombasa and Dar es Salam has projects in both passenger and freight. “There is a big appetite from
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international OEMs to participate in infrastructure projects on the African continent purely because most other markets are saturated. There is a lot happening in Eastern Europe and Russia but apart from that, markets like Germany, and France are reaching saturation so Africa is possibly the last trading ground in terms of growth and major infrastructure projects. Whether it’s rail, dams, mines, ICT, energy or anything else, Africa is the place where development is taking place and will continue to do so for the next 30-50 years,” he says. 8 YEARS OF EXCELLENCE NRE was founded in 2008 and its reputation has grown exponentially over the past eight years. What started as a small group of stakeholders with various complementary skills has blossomed into an internationally recognised organisation with around 200 people. “Personally, I’ve been involved in the rail industry in South Africa for the last 27/28 years. I started my career in the railways and worked myself up
NALEDI RAIL ENGINEERING
to be the operations manager for the Johannesburg operation of Metrorail services,” says Rasool. The developments within government departments and various parastatals meant that NRE was born through necessity for experienced, quality service providers to join the industry. “The Department of Transport was undertaking a lot of work in the late 90s and early 00s researching what was required for the recapitalisation of the rolling stock and what sort of expertise was required. A that point in time, you had two main operators in the refurbishment industry; Transnet Engineering and Union Carriage and Works. Metrorail and the SARCC (South African Rail Commuter Corporation) were looking for new entrants into the market; I had left Metrorail and formed what was known as Newco,
which became Naledi Rail Engineering with a host of other stakeholders. It started with around 12 different people and we diluted that down to the two directors and shareholders who own the company now, and that is Dr Jackie Mphafudi and myself - we are the founding members who originated the concept and put together the bid which was nominated by Metrorail as a service provider to them,” the CEO explains. “We brought people on board with different types of expertise – people who were handling the funding, operations, management etc. and we founded the company that would eventually go on and be successful with the tender. “We submitted the tender in 2005/06 and we were successful. Out of 52 tenders, there were only two that were successful and shortlisted and we were one of those and the rest is history.
“We started operating around 2008, we were given three prototype coaches by Metrorail to complete, we done that and handed them back within around three months and concluded around nine or ten coaches in the remainder of that financial year. We then signed three year and five year contracts with Metrorail and PRASA. We grew quickly; we started with 13 employees and now we have almost 200,” Rasool explains. THE RISING STAR Many of the organisations involved in the upgrade and renewal of SA’s rolling stock program are international companies and while there is a requirement for local content to be a part of development package, historically there has only been a small number of local companies that specialise in manufacturing and refurbishment. NRE is a local
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BUSINESS PROFILE
company, owned by South Africans, with a commitment to transformation, diversity and entrepreneurialism – this was proven at the 15th Annual Oliver Empowerment Awards where NRE was awarded three separate accolades. NRE was also awarded by Impumelelo Top Empowered Companies for its contributions to transformation in 2016. “We thought of using the name Naledi which means ‘star’. There’s a large district in Soweto called Naledi and a train station called Naledi and we want to be the rising star,” says Rasool. “In the beginning, while attending contract meetings where all the other contractors were present, we were given the nickname ‘the new kids on the block’ and we used that to our advantage when it came to things like price negotiations and price discussions, we said ‘we’re the new kids on the block so we need to be treated with care and preference’ and we lost that nickname
very quickly. “It’s been an interesting journey; we’ve achieved a lot and it’s a beginning of a fairy-tale that will be told in years to come. We’ve taken our place in the rail industry; we’ve been engaging with all the national OEMs, we have exchange programs with companies around the world, we’ve submitted a bid for the new rolling stock contract in South Africa and partnered with the Swiss company Stadler and ABB. We have working arrangements with Chinese, Spanish and British companies and from an industry perspective we’ve made our mark – we’re on our way to becoming a global company,” he adds. 200 TO 500 PEOPLE IN THREE YEARS As with any company, anywhere around the world, a company that provides high-quality services needs skills and expertise which are not always readily available in the workforce. This was
WAHED RASOOL NRE CEO
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certainly the case in South Africa where unemployment levels still sit at around 25%. NRE recognised this at an early stage and has taken steps to upskill its workers wherever necessary. This type of internal development is often at the foundation of the most successful companies in the world. “When we started Naledi, we recognised that there was a skills gap and we wanted to put a model in place to address that,” says Rasool. “The fact that we’ve gone from 13 to 200 people in just under ten years is indicative of the growth that we’ve had at the company. We use a model where we take existing skills and partner those with people who are under skilled and train them up in-house and then send them on learnerships so that they can become qualified as artisans. “We’ve sent junior management at shop floor level to other parts of the world to see how things are done in terms of systems and processes so that they can come back and share
NALEDI RAIL ENGINEERING
that with their colleagues here. These campaigns have been very successful and we were congratulated by the DTI,” he adds. The country’s rolling stock fleet renewal programme is already creating jobs and, according to Dr Mphafudi, it has the potential to create more than 30,000 in total over the coming years. NRE is taking steps to speed up the creation of jobs and is being supported by the government. Even as far back as 2011, the Department of Transport said ‘establishing a local manufacturing base for the new rolling stock for PRASA and Transnet will have the benefit of creating a substantial number of local jobs and the redevelopment of rail engineering capacity and skills that have been lost over decades of underinvestment in the local rail engineering industry’. “We’re doing things to make us sustainable going forward but there’s also a drive form the industry to look at accelerating this upskilling so that people can provide different types of
programs and systems. We work closely with MERSETA and TETA and we’ve received learnerships from them. For us, it works relatively well. “As a private sector company, we value our assets which is our people and we’re working towards empowering them so they can compete with the Chinese, Europeans and North Americans. What gets produced, welded or painted in South Africa should be able to compete with anything produced anywhere in the world and we’ve made huge inroads. “We have an expansion program that will take us from 200 to 500 people in the next three years so we need skilled people and we have action plans to make sure we are not held up,” explains Rasool. The South African rail network is one of the largest in the world and estimates place the total network at more than 21,000 km. it is vital that this resource does not go to waste and this is why the work of companies like NRE is so important. Too many passengers
that could use rail are using the already stressed road network and too much rail-friendly cargo is also hammering the tarmac. When the rolling stock renewal program is complete and when the promised investment into the rail industry begins to bear fruit, rail could transform the country’s mobility in a big way, boosting performance and ability of many of the country’s industry leading organisations. NRE is undoubtedly going to play its part. As a forward thinking industry frontrunner, this is a pioneering company with a leadership team that many others must envy. Revolution is certainly coming to this industry; now is a great time to be involved
NALEDI RAIL ENGINEERING +27 11 830 1470/1 account@naledirail.co.za www.naledirail.co.za
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DURBAN ICC
“Meetings and Exhibitions Are Great Vehicles for Moving Business
Forward” PRODUCTION: David Napier
Durban is a city geared up for international events and conferences. The city, the beach, the people and the government are all ready to welcome guests from across the globe and the Durban International Convention Centre is the award-winning beating heart of the events business.
//
Tourism is a major driver for the South African economy; it’s an area that has been identified by the government as one which is worthy of large scale investment. In February, President Zuma announced that R100 million a year would be spent on bolstering domestic tourism services. International arrivals increased by five million in 20 years from 1994 and now sit at 8.9 million. More than 1.5 million people are employed as a result of the tourism industry, highlighting its importance. While Cape Town and Johannesburg are known the world over for their fantastic offerings for tourists, Durban is becoming more and more popular and starting to match the two heavyweights when it comes to attracting visitors. With the Commonwealth Games headed for the city in 2022, Durban will welcome
guests from all over the world but thankfully Durbs is used to this because of one of its most successful businesses - the Durban International Convention Centre. The ICC is one of Africa’s most popular exhibition spaces and has hosted conferences, concerts, trade shows and sports events with guests coming from all over the world. It dominates the Durban skyline and sits close to the beach, giving guests easy access to the city when they’re done doing business, dancing or trading. As a business case, the Durban ICC is currently one of the strongest around; having financial success in uncertain economic climates, attracting major events and stars, creating jobs and benefitting the local community. Marketing Manager, Scott Langley tells Enterprise Africa that recent strong financial performance and winning
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‘Africa’s Leading Meetings and Conference Centre’ at the World Travel Awards have gone down extremely well, and the attraction of some big events is making for an exciting future. “It has been good but that lays the pressure on to do better in the following year. We’ve had great support from the clients, good partnerships with our stakeholders and while we don’t do it for awards, it’s always nice when you’re recognised by the industry,” he says. “Profitability is probably one of our top achievements, along with a clean audit that we got from the auditor general here. It took us a long time to reach profitability but we’ve been able to maintain it for the last five fiscal years and we’ve been able to grow it in the last year as well. The reason that’s important is because we need to take those profits and reinvest them into the venue to keep it at
BUSINESS PROFILE
a world class standard. We’re coming up for 20 years next year and we don’t want the building to look like its 20 years old, we want it to look brand new.” SHOWCASING DURBAN The Durban ICC can offer 33,000m² of flexible exhibition and meeting space, it is located 30-minutes from the King Shaka International Airport, over 3,600 Hotel rooms close by and is equipped to meet the needs of the world’s most prestigious and complex events. Inside, big upgrades have been completed recently with plans to continue upgrading, especially with IT systems, in the future. “Our facilities director is excellent and he has a plan for the next four to five years. Previously we’ve redone all the
kitchens from the ground up, we’re in the middle of redoing all the bathrooms throughout the whole centre which is a major project, we’ve just finished putting in all new carpeting in all the convention halls, we upgraded the smaller meeting rooms and hospitality suites with all new décor, AV and technical equipment so it’s looking good. The next thing we’ll want to look at is making sure that our IT infrastructure is cutting-edge as the demand for Wi-Fi and IT facilities gets pushed higher and higher every year,” says Langley. In the next few months, the ICC has some major events scheduled and it will host a range of people from across the globe. This month sees the 2016 INDABA and China Trade Week rolling into Durban.
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In June, Seal will be live in concert and the SAMA’s will bring glitz and glamour to Durban. In July, the ECR House & Garden Show is in town. On July 18th, the 21st International AIDS Conference is back and all of these events will boost the local economy as well as the revenue at the ICC. “The mandate that we have is to generate economic impact in our city and where we can spread work around to different suppliers throughout the year, that’s better for the economy. We need to grow smaller businesses; they create the jobs, if they do well they’ll create more jobs and that’s what South Africa really needs to do when addressing job creation and poverty alleviation so we want to support small business provided that they’re
DURBAN ICC
giving the right level of service,” says Langley. “We’ve had to think creatively about things and if you want to reach a big audience you have to go with a big plan. Sometimes those plans take years to implement and what we’re really looking forward to is the name recognition that we hope to get from the 2022 Commonwealth Games - not just for the money that the event beings but also the media exposure that the event will bring globally for a city like Durban is fantastic. “One of the problems we have when communicating and marketing globally is that we have to communicate where Durban is and what type of place it is before we can start talking about the services that we offer. If you already have an established destination then that work is already done for you – people already have a desire to visit that city. You can be doing the best job in the world in your centre but if people don’t know where your city is then you’ve got an uphill battle. It first starts with marketing the destination, making sure people know that Durban is a fantastic destination and it’s a city that’s on the move with a vision. When people start hearing the name of Durban associated with world class events and development plans, when we get that name recognition globally, I think everybody in the city will benefit. “We’re looking forward to the Tourism INDABA which is our big travel trade show which is May 9-11. The South African Music Awards are going to do something really special this year with their VIP event in our arena and they have fantastic plans for an overflow public viewing area where they’ll close the road with a massive party, fashion shows and lots of other things. In July we have the International AIDS Conference which comes back to Durban for a second time and that hopes to attract in excess of 20,000 delegates and that should be the largest event ever hosted on the continent so a lot of planning is going into that. It’s again a great opportunity for showcasing the city and it’ll attract a lot of media attention,” explains the Marketing Manager. The location of the facility plays a
big part in attracting many events and sitting just a few blocks from the beach in a city that has excellent weather makes for many happy guests. “The beach is a big part of life here,” says Langley. “It influences our lifestyle and makes for a more optimistic and friendly outlook that Durban folk have. We get 320 sunny days each year and it helps with optimism, positivity and friendliness.” IMPORTANCE OF MARKETING During times of economic uncertainty, like those we are seeing right now, the market for events and conferences changes and budgets and bookings vary. “Events are certainly evolving and they might be changing shape but the need for meetings is definitely there. We see it here in South Africa even with a sluggish economy, when times are good people want to meet to grow their business and when times are tough people want to
meet to survive. They’ll discuss challenges and how to overcome them so in both times meetings and exhibitions are great vehicles for moving business forward,” says Langley. “When people are tightening belts, the mistake is to cut back on marketing. You can cut your costs elsewhere but if you cut on marketing and sales, that’s a recipe for disaster and I think most companies understand that. Previously they might have sent 10 people to the annual conference, maybe this year they’ll send six but they still have to be there.” And with events like the International AIDS Conference, the Tourism INDABA, China Trade Week and similar, the set up at the Durban ICC has to be on point. Whether it’s 500 delegates or 10,000 music fans, the Centre’s staff have seen it all before and can call on years of expertise to solve problems quickly, should they arise at all.
ACROSS
THE board
LOW PRICES FROM KZN’S
leading
LIQUOR STORE
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DURBAN ICC
“Our track record definitely helps us. We were South Africa’s first international convention centre and a lot of the people who were part of that opening team are still part of the team today. Our Marketing Director, our Executive Chef, our Operations Director were all part of that original team so when we say we have the most experience in hosting international events, it’s not just as a centre but it’s the actual staff and that experience really helps,” boasts Langley. “We know what we’re doing, we’ve done it many times before and we fall back on expertise that we’ve gained hosting international events in the past. There’s also lots of planning that happens year round with city partners like the Metro Police, city officials, the Traffic Department, so it’s a real concerted effort when we host these international events; the whole
city embraces it and everything is geared to run seamlessly.” Moving forward, the focus of Langley and the rest of the team will be continual improvement of the offering, continual growth of the business and its partners in Durban, and boosting the overall marketing of Durban as a whole. This will of course come with the challenge of maintaining strong financial performance and attracting leading local and international events but as we know, the Durban ICC people are well versed in how to manage these situations. As the events business grows and adapts, one thing remains constant and that is the Durban ICC. It’s South Africa’s oldest, one of the largest and one of the most well equipped so if you need quality event/conference space then look no further
DURBAN ICC +27 (31) 360 1000 sales@icc.co.za www.icc.co.za
//WE KNOW WHAT WE’RE DOING, WE’VE DONE IT MANY TIMES BEFORE AND WE FALL BACK ON EXPERTISE THAT WE’VE GAINED HOSTING INTERNATIONAL EVENTS IN THE PAST//
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INSIDEDATA
Growing in Harmony With Nature PRODUCTION: Colin Chinery
With innovative multi-channel content-rich customer engagement, South Africa-headquartered InsideData enables companies to measure and improve business communication efficiency, increase sales and build their brand. “It’s a unique and universal concept that we have hit upon,” says CEO Pieter Snyman
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At the height of last year’s South African postal strike, three communication companies were deep in merger talks, forshadowing the imminent importance of electronic communication. “We were trying to bring print and mail together with the electronic world, and the lessons we learnt from that period uniquely positions us to be agile and quick,” said Pieter Snyman. A former CIO for South African Airways, Mr Snyman is CEO of InsideData, the Johannesburgheadquartered business communications company that emerged from the amalgamation of the three companies sharing separate but inter-related competencies; Business Genetics – of which he was CEO Tunleys Print & Mail and LaserCom. InsideData enables businesses to measure and improve business
communication efficiency. “We determine customer behaviour by analysing the response rates and successful delivery of communication elements. “Marketing campaigns, portal usage, statement presentations and invoice payments are analysed to render a customer profile that allows personalised engagements and reengineer business communication.” In a sector of largely standalone single media conduits – print for instance, or electronic communications – the scope of InsideData’s integrated multi-channel offering is unique in South Africa. With branch offices in Johannesburg, Cape Town, Durban and Centurion, this is a “a sizeable company that specialises across numerous different channels from print and mail all the way through to very advanced mobile technologies.
CHANNEL-AGNOSTIC “And in all these cases we can be flexible and consumer-friendly. Being completely channel-agnostic with no paper or electronic preference, we send what you like. And if there’s a mechanism where you can express your choice we will pick that up and make it available to you. “There are bigger companies out there, in the print channel for example, but if you combine all our channels, that’s where our uniqueness comes in.” Current clients include HSBC, Standard Bank, Nedbank, Telkom, Vodacom and the Mr Price Group. Retailing, said Mr Snyman, makes a perfect fit for the InsideData model, with current initiatives in this niche “very positive. Retailing represents a huge opportunity for us and we are bullish that our product stands out well. “In retailing there’s a very big marketing drive on one side, with the
PETER SNYMAN CEO OF INSIDE DATA
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Johannesburg: +27 10 595 9700 Cape Town: +27 21 883 3373 E-mail: sales@communicationgenetics.com Support: sales@communicationgenetics.com
Communication Genetics – the essential solution for digital dialogue Communication Genetics is a South African-based leading provider of Customer Communication Solutions. Founded in 2008 this progressive tech-centric firm is founded on years of communication technology expertise and intricate knowledge of emerging markets. It is focused on helping companies to discover innovative ways to create dynamic, multi-channel touch points with customers. This is done by combining its knowledge of next-generation solutions and valuable insight into trends that are shaping today’s digital communication landscape. The company service portfolio covers complete customer communication, iBPM, records & output management, document tools, and data protection.
“Our solutions are targeted at clients within the financial, insurance, telecommunications, automotive and government sectors. By installing infrastructure at state-of-the-art hosted facilities, we make high-end solutions accessible and affordable. In addition, our solutions reduce the cost of ownership,” explains Fred Steinberg, Managing Director of Communication Genetics. Our Solutions are best-of-breed and recognised to operate according to international and established standards. They are also offered on a Software-as-a-Service basis. Communication Genetics’ value proposition is providing access to solutions from internationally recognised solution vendors. This is the result of a number of industry-leading partnerships established with vendors to bring to market cutting edge communication technology.
Fred Steinburg
Managing Director of Communication Genetics Appian - iBPM
For example, the company’s alliance with Appian ensures that clients are exposed to the very best in Business Process Management (BPM) Appian iBPM provides an enterprise application platform that affords the user access to business data, processes, documents and collaboration through devices and social interfaces. This technology has earned the company recognition as the leader in the Gartner Magic Quadrant for Intelligent Business Process Management Suites 2015. The enterprise application platform features drag-and-drop functionality, pre-built accelerators to make embedding complex functions easy, with native mobility that makes everything instantly mobile-ready with no additional effort. The platform means that enterprise ready apps can be created quickly, require virtually no coding and makes everything instantly mobile-ready. The offering is available on-premise or in the cloud, enabling users to design, execute, manage and optimise their business processes.
Financial muscle
Communication Genetics has further differentiated itself within the fintech market by securing the contract to supply FIS CSF customer communication software to South Africa’s finance, insurance and retail sectors.This technology can generate high-volume recurring documents, or individual customer communications, while enhancing marketing capabilities, strengthening customer relationships, and reducing development costs. However, it is Communication Genetics’ stance on the safety and integrity of digital communication that has won it further acclaim in the market.
Totemo - Data Protection “We have successfully brought to market business-to-business and business-toconsumer platform independent solutions designed to protect information on the move. This technology empowers businesses to effectively manage and deal with the realtime implications of compliance with legislation like the Protection of Personal Information Act and covers both Secure Email and Secure Managed File Transfers” says Steinberg.
Proud to work Alongside:
RSD - Output and Records Management RSD Folders® is a secure content and document management solution for complete records management, content archiving, auditing, information lifecycle management (ILM), search and discovery. It enables the efficient capture, storage, and retrieval of content generated by any legacy, ERP or PC-based application. Solution Benefits: • Identification and classification of any type of content • All content in native format • Definition of retention policies based on regulations and internal process • Enforcement of policies on content at anytime RSD EOS is an enterprise-grade distributed output and report management solution, RSD EOS facilitates the identification and management of virtually any output data stream as it is created, regardless of the application or platform on which it is generated. It fully automates report and content archiving, retrieval and destruction according to easily configured business rules. RSD EOS is well suited for high volume datacenters and other content-intensive businesses, and is available on both Mainframe and Open Systems environment. For many organizations, EOS is the defacto standard for managing high-volumes of business critical information. Companies around the world dramatically reduced millions of dollars in printing costs as users shift from a paper-centric mentality to accessing content electronically Communication Genetics thrives on the convergence of leading technologies to solve the daily challenges faced by companies as they transform into digital ventures. To this end its value as a preferred supplier and reliable technology services partner is unequalled.
BUSINESS PROFILE
shopping or e-commerce on the other. The two are somewhat disconnected and I believe we are uniquely positioned to bring these two worlds together as a single point of communication.” InsideData’s electronic content can be movie based, graphicrich, and personalised to digital magazine quality. It is also crafted for individual consumer preferences and usage/buying patterns and profiles such as gender, education and spending habits, enabling the client to fine tune campaigns and communications. “Taking the data and insights from these, we might say to the client’s marketing team: ‘notice this usage pattern changing, did you see that when we sent this advert to the customer base this month the consumption rates suddenly went through the roof because of the change in your marketing message?’
WINNING APPROACH “It’s this analytical approach that is now taking our business into a very different direction. Core services remain the same - print and mail, email, mobile, data and infrastructure - but the analytical scientific approach layered on top is really changing the face of what we are doing, and I think our consumers and clients are noting this.” The big challenge, said Mr Snyman, is to deal with a world that is simultaneously growing and shrinking and dealing with a legacy that has to be kept functional. “An ability to grow in electronic messaging requires a very different mind-set from the printing environment. And the key is to handle both at the same time within the one business. “The exciting part is that our analytical approach to the world, along with our vision, is taking us in the right direction. We find a lot of our competitors are confining themselves to just one or two of the channels we service, and it’s our
DECISION SUPPORT SERVICES
OPERATIONS MANAGEMENT
DISTRIBUTION
COMPOSITION
PAYMENT GATEWAY
WHITE SPACE MANAGEMENT
DATA INTEGRATION
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INSIDEDATA
OPERATIONS MANAGEMENT
DISTRIBUTION
COMPOSITION
PAYMENT GATEWAY
WHITE SPACE MANAGEMENT
DATA INTEGRATION
combination of the analytical and having all the channels in one house that I believe position us uniquely.” In the meantime, bandwidth has increased dramatically in Africa and, with the continent edging closer to one billion mobile subscribers, a report from the international research firm TeleGeography shows Africa’s internet capacity is growing faster than other world regions. “Getting connectivity between South Africa and Kenya for example, is now vastly different from what it was a couple of years ago, and the options available to internet-based local users are of a far higher quality than ever before,” said Mr Snyman. “You can now serve and reach engaging content so what you can offer people is now very different from in the past. Netflix for example - global provider of on-demand streaming movies and TV series - has all of a sudden decided to look at emerging markets and is now rolling out across Africa.” And with recurring problems in the South African economy impacting on business and industry, InsideData is
also outward-planning. “We are looking to service customers across the border especially into the rest of Africa, and are making very good progress there. “It’s still in its infancy, but it involves big corporate banks that have a real need in Africa for the types of product we provide, and which are very different from what they have been provided with - or self-provided - in the past.” But InsideData is not stopping at Africa. “We are seeing opportunities not only to cross the continent but reach out as far even as far as Australia for example, where we are beginning to serve clients. “It’s quite a universal concept that we have hit upon. And this is where we start to de-couple ourselves over time from being dependent on only one economy to being dependent on the world economy. And again, although this is in its early days, this is a big target for us. A GOOD SPACE TO BE “We have grown legs quite quickly and this is exciting for me because it allows us to gain foreign revenue which
is good for South Africa where the currency is currently under quite a bit of pressure, and gives us an international exposure. All in all I think we are now in a very good space.” Just a year ago InsideData was based solely in South Africa. But such has been the growth that it now has a two-to-three year strategy to deliver the same types of volumes to a fiftyfifty customer base spread over other currencies and geographical locations. “I think it’s good for Africa that what was born in Africa - and specifically South Africa - finds its footprint across the world and remains successful. And for InsideData this is a journey proving to be both challenging and very exciting.”
INSIDE DATA +27 11 611 5000 @InsideDataZA www.insidedata.co.za
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TIGER BRANDS
Mac Dougall Will Have to Earn His Stripes in Tough
New Role PRODUCTION: Manelesi Dumasi
A mixed 2015 for Tiger Brands saw longstanding CEO Peter Matlare step down and Lawrence Mac Dougall hired as his replacement. While this is one of South Africa’s best companies to work for, the new man will certainly have his work cut out…
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Following the merger of Goba and Hatch in 2013, South Africa gained a multi-disciplinary engineering expert with a huge reputation. From the Goba side came the extremely talented group of people with local knowledge and from the Hatch side came international expertise and a commitment to quality. When the two became Hatch Goba, new markets opened up and the business in South Africa now operates primarily in the mining, metallurgical, energy, and infrastructure industries. Goba was founded in 2001 by namesake Truman Goba; Hatch was founded in 1955 in Toronto, Canada and became Hatch in 1958 when Dr Gerald Hatch joined and renamed the business. Hatch Goba’s services include
management consulting, engineering, process development, operational performance, environmental services, technologies and project and construction management. After completing a host of high-value, high-importance projects, the company is now looking to the future and is making deals that will help to build the pipeline for the next three years at least. SOUTH AFRICAN FOCUS The company remains focussed on one of its core African markets – South Africa, after all, this is where Goba built its name and where major infrastructure developments are taking place on a more frequent basis. The country’s National Development Plan (NDP), that aims to achieve a number of economic goals by 2030, has highlight
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BUSINESS PROFILE
//WE ARE ABLE TO LEVERAGE OUR PEOPLE CAPABILITY TO PERFORM BETTER IN THE MARKETPLACE. AND IF WE DO THAT, WE WILL UP OUR PERFORMANCE, AND IF WE UP OUR PERFORMANCE, THERE WILL BE BETTER RETURNS FOR THE DIFFERENT STAKEHOLDERS// infrastructure development as one of its key focus points and hence South Africa has adapted its strategy to include projects of this nature. Hatch’s Global Managing Director for Infrastructure, Martin Doble recently told Creamer Media that the Durban–Free State–Gauteng logistics and industrial corridor as a primary focus because of its position as the country’s freight transportation backbone. “We’re expecting a tremendous amount of investment to occur along that corridor,” he said. “It has taken a long time to reach this point, but we see it as one that will move ahead quite quickly.” Hatch Goba Chairperson Trueman Goba, who was appointed by South
African President Jacob Zuma to the National Planning Commission in 2010, also highlighted the importance of development corridors. “Fortunately, South Africa has a good core network of national infrastructure,” he told Creamer Media. “But there are challenges to maintain and expand [this infrastructure]; both addressing future demand and the needs of the country’s growing economy.” One element of this development, in the transportation sector, is the Go!Durban transit system. It’s a massive project that Hatch Goba has been involved with from the outset, advising on overall strategy development and detailed feasibility study for Phase 1, which will develop the network’s first four corridors—one rail
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and three rapid-transit bus lines. Over the next 15 years, the current system will be replaced by 90 km of rail rapid transit, 330 km of bus rapid transit, 2200 km of road-based feeder services, 290 km of complementary rail services, 820 km of complementary bus services and a fleet of approximately 4120 vehicles. Of course, alongside the ‘major projects’ that Hatch Goba undertakes, its day-to-day work on smaller projects that require ongoing upgrading and maintenance will remain prominent. Along with work in the construction and mining sectors, Hatch Goba also has extensive proven expertise in the energy and infrastructure industries. Through its work on the country’s roads, building freeways and bridges, Hatch Goba has built a close relationship with SANRAL and the Department of Roads and Public Works. SANRAL sourced the expertise of Hatch Goba to be the lead consultant on the planning and preliminary design of N3, a section of the Durban Gauteng Corridor, stretching from Paradise Valley, just west of Durban, to Cedara, north of Pietermaritzburg. Because of the nature of the road, it has become something of an accident blackspot in the past few years
TIGER BRANDS
but all solutions to upgrade or change the situation were not viable. The steep grades and sharp curves as the route descends sharply from the Midlands Plateau to the Coastal Plains of KwaZulu-Natal are what cause the issues so Hatch Goba has developed a new alternative route incorporating viaducts and a tunnel that addresses all the safety concerns while still achieving an acceptable rate of return on investment. “SANRAL has been a key client for Goba, now Hatch Goba, for many years. We have developed a strong relationship with SANRAL and have successfully completed numerous high-profile appointments,” says project lead and sponsor, Freek Serton. ENERGY SECTOR The company’s work in the energy industry is vast and has involved projects on major power stations, major solar installations
and other utility sites to name just a few. In March, the company talked about its capabilities, saying that it would demonstrate a range of innovative technologies various mining, petrochemical and industrial projects in Africa. Project Engineer from Hatch’s Jo’burg office, Cobus Schutte says the company is confident in a range of solutions including: thermal power generation (including conventional and advanced technologies), cogeneration, gasification (coal, biomass and waste), coal‐to¬‐liquids and gas quality control (including flue-gas emission reduction, syngas handling, treatment and carbon management). Currently, the company is active a long-¬term contract with Sasol. “The engineering services that we are providing here on an ongoing basis include materials handling design, machine design
SearchLight is designed to help organisations take control of, and reduce their inbound supply chain costs. It helps procurement teams to quickly identify sourcing opportunities, register and maintain vendor information, automate the tender process, convert tenders to contracts, measure contract usage and compliance, track savings and benefits, assign tasks and triggers to the procurement team as well as store and track tender and contract documentation.
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and pressure vessel design,” Schutte explains. “Here Hatch is playing a key role in fine-tuning its gasification technology in order to boost its syngas generation and coal-to-liquids business over the next decade. “If you want to talk power generation and energy projects in general, Africa is definitely the place to be,” Schutte comments. “While we are not aware of too many large-scale power generation facilities being erected, there is a lot of focus on own generation, such as remote mines or any kind of production facility.” The company was an important player in the development of two 50 MW solar parks, one near Kimberley and the other near De Aar and in February last year, Colin King, Project Manager, Power Delivery & Integration in Cape Town detailed the impressive undertaking saying: “Our design review covered all of the 22 kV
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WWW.MARSHANTECH.COM searchlight@marshan.co.za (+27) 21 686 0748
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TIGER BRANDS
switchgear, cable networks, protection, control, measurement and SCADA equipment, and civil works for the solar panel terminals. Beyond the traditional OE services, Hatch’s in-depth knowledge of South African standards and legislation added considerable value to the design and construction reviews. We also oversaw specialist third-party testing services.” EMBRACING TECHNOLOGY Like any industry, engineering is one that is constantly changing but particularly in the last decade, the pace of change has increased thanks to the onset of technology. Communication is now instant and people want things done faster. Hatch Goba Regional Director – Eastern Cape, Geoff Mendelowitz explained more about how the industry has advanced when he spoke to 10minuteswith.com. “The industry has evolved a
tremendous amount,” he said. “Now, everything is instant – we email huge drawings across the world in an instant and all the technology jump and change has meant that we have had to jump and change as well. What use to take three weeks, must now be done in a day. We now expect to do a lot more with a lot less so we’ve had to adapt and change. What hasn’t changed is that we still need good, solid engineers to use systems and engineer the best solutions and find the most cost-effective solutions for clients the fundamentals of engineering remain the same.” Nick van den Berg, Manager of Structures – Eastern Cape, reiterated these points, saying: “Technology is the major factor behind the change in the engineering industry. Price is also a driver. People are looking more at the price of a product rather than quality and the longer term benefits, so we need to tailor our
services to still offer high-quality while being competitive.” With South African Finance Minister, Pravin Gordhan announcing in his budget speech in February that the government will spend R865.4 billion on public infrastructure over the next three years, with a large portion of this going to energy, transport and municipal construction, Hatch Goba is perfectly positioned to ride the economic wave and prosper. The company’s expertise and international knowhow place this company at the forefront of the industry and it will remain there for some time to come
TIGER BRANDS +2711 840 4000 tigercsd@tigerbrands.com www.tigerbrands.com
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THE EFFECTIVENESS COMPANY
Unique
Outsourcing Solutions PRODUCTION: Timothy Reeder
The Effectiveness Company specialises in delivering sustainable operational performance improvement and optimisation, through an execution model which focuses on developing strategic partnerships with customers based on outsourcing/insourcing service level agreements.
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At The Effectiveness Company, the priority is to develop and apply unique and proven outsourcing and insourcing solutions for businesses, that can provide the vital link between corporate goals and their successful implementation. Effectiveness also provides consulting services aimed at helping customers identify and analyse problems and opportunities, and can assist with payroll and joint labour relations. “Effectiveness Company was established initially in 1997 as IBCF, before being rebranded as Beyond Outsourcing, and then again as Effectiveness Company as an entity however we have existed for almost 20 years now,” newly appointed CEO Clayton Williams explains.
The company’s experienced consultants are positioned to help identify and quickly solve workflow and management problems, while focussing on identifying ways in which performance throughout the company may be improved. It is equipped to provide full labour management services, from recruitment to training and deployment, to streamline workflow and allow staff to fulfil core business functions. Williams goes on to delineate exactly what it is the company sets out to achieve: “We are really an execution company that operates in the business transformational outsourcing space,” he says. “The easiest way to explain what we do is the comparison which often arises between ourselves
and banks or investors. They will typically supply financial capital to businesses, and either get a monthly return via interest or through equity. “We do exactly the same - whereas labour brokers might advise as to how many people are needed and then source this personnel and hand them over, we supply the totality of required business processes. Everything from management operating systems, the role profiles, the accountabilities and responsibilities, which we then manage. Essentially what we provide is managed human capital with a focus on delivering guaranteed results which we can quickly underwrite to our clients.” Through the provision of business transformation outsourcing and
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insourcing services, the Effectiveness Company takes on the client’s entire operation in order to improve the processes and then runs and manages these on an outsourced or insourced basis. In broad terms, outsourcing refers to a transfer of certain business functions to an outside contractor. It can also be more specifically defined as a strategy by which an organisation contracts out major business functions
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to specialised and efficient service providers, who then as a result become valued business partners. “We serve any industry,” explains Williams. “Although we steer clear of involvement in very low-touch business, and, equally, those on the scale of nuclear reactors or similar, we deal with anything in between these scales of industry. One of our customers, for example, is a funeral house, and from the moment you walk in to their premises it is instantly known that this is their brand. It is filled with our people, from the mortician right up to the regional managers. We manage that on their behalf, while we also have a number of Telco stores where the story is the same - it is made up entirely of our sales consultants, our area manager, and our regional managers who oversee those stores in exactly the same way. “We turn our hand to anything that can be reduced to a business process and managed using an effective management operating system, which is really in business of scale,” concludes Williams. There is a central focus for Effectiveness at present on growth and expansion, in the hope of restoring the company to its former glory. “A key reason behind my appointment was the aim of taking the business from the 400 employee mark, where we stand today, back to the 2000 mark and we’re certainly on the uptick at present. We’re making obscene
THE EFFECTIVENESS COMPANY
investments in growth - in terms of developing new IT platforms and all of the technology enablers that we require to keep pushing things forward.” Williams goes on to lay out how some of Effectiveness Company’s key challenges also represent its biggest opportunities. “Coming back into South Africa it is clear the country has an execution gap, due to the skills gap. Within the culture, execution is largely absent which is a massive opportunity for us, but it’s also our biggest challenge in that we need to bring in people who are not used to a culture of execution.” The investments Williams describes represent some of Effectiveness Company’s primary expansion plans at the present time. “Our major developments are in IT enablers, to make sure that our platforms can support the management operating systems. Equally, we’re making huge investments in getting the right staff on board, and we’re working closely with some sizeable partners on join ventures. We are fanatical about employing the correct staff - there is a very specific role profile with accountabilities and responsibilities for every single staff member, right down to the administrator. Without that we wouldn’t be able to do what we do.” Businesses in today’s climates need to implement new business ideas in short time frames and at minimal costs, and part of what has contributed to Effectiveness Company’s success to date is its uniqueness in the market. “There is no competition there are a number of companies who do number one labour brokering with whom we are often confused, a misconception which poses something of a challenge, but these other companies simply do not have the processes and the level of detail and integration, both vertical and horizontal, that we have. They don’t have the overall high level management operating systems we can employ to close loops in businesses. Not one of the companies who occupy the same space will go into a client and underwrite results like us, where we either promise a certain lift in performance or reduction in costs or we won’t claim a management fee. No one else does that.”
All of which brings us to discuss the immediate future of The Effectiveness Company. “At the end of the next three years we should be looking seriously at listing on the main board on the JSE, in terms of revenue growth and profitability,” states Williams. “We’re happy with our margins so if we can maintain those margins of increased growth then it will be a real success.” This is almost secondary in priority, however, as Williams also speaks of the more personal side of the company’s development, in impassioned tones. “It is common to hear fancy buzzwords like ‘empowerment’ bandied around in the industry, but what we do really does empower both people and companies. In South Africa we have a lot of hype surrounding the promotion of small and medium sized businesses, with little though as to why we’re doing this or the type of business we should be promoting.
“What we’re doing, though, is really making a difference, in terms of upskilling people. We find the right person, and in that respect we can take on someone with very little experience or qualifications, and with the support of our processes and management operating systems they learn and are coached almost on a daily basis in how to deliver effectively. That’s very powerful in our economy where economic growth is desperately needed, and we feel that we can make a big impact in this regard through our approach to business.”
THE EFFECTIVENESS COMPANY +27 11 513 5300 @effectivenessco www.effectivenesscompany.com
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HATCH GOBA
Engineering Excellence in a Quickly Changing
Enviroment PRODUCTION: David Napier
Working on engineering projects all over the country, and often further afield in Africa, Hatch Goba is now the go-to name for projects big and small. This is an organisation with almost unrivalled expertise and one which will continue to grow, throughout 2016.
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Following the merger of Goba and Hatch in 2013, South Africa gained a multidisciplinary engineering expert with a huge reputation. From the Goba side came the extremely talented group of people with local knowledge and from the Hatch side came international expertise and a commitment to quality. When the two became Hatch Goba, new markets opened up and the business in South Africa now operates primarily in the mining, metallurgical, energy, and infrastructure industries. Goba was founded in 2001 by namesake Truman Goba; Hatch was founded in 1955 in Toronto, Canada and became Hatch in 1958 when Dr Gerald Hatch joined and renamed the business. Hatch Goba’s services include management consulting, engineering, process development, operational performance,
environmental services, technologies and project and construction management. After completing a host of highvalue, high-importance projects, the company is now looking to the future and is making deals that will help to build the pipeline for the next three years at least. SOUTH AFRICAN FOCUS The company remains focussed on one of its core African markets – South Africa, after all, this is where Goba built its name and where major infrastructure developments are taking place on a more frequent basis. The country’s National Development Plan (NDP), that aims to achieve a number of economic goals by 2030, has highlight infrastructure development as one of its key focus points and hence South Africa has adapted its strategy to include projects
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of this nature. Hatch’s Global Managing Director for Infrastructure, Martin Doble recently told Creamer Media that the Durban– Free State–Gauteng logistics and industrial corridor as a primary focus because of its position as the country’s freight transportation backbone. “We’re expecting a tremendous amount of investment to occur along that corridor,” he said. “It has taken a long time to reach this point, but we see it as one that will move ahead quite quickly.” Hatch Goba Chairperson Trueman Goba, who was appointed by South African President Jacob Zuma to the National Planning Commission in 2010, also highlighted the importance of development corridors. “Fortunately, South Africa has a good core network of national infrastructure,” he told Creamer Media. “But there are challenges NFB CEO - MIKE to maintain ESTMENT
BUSINESS PROFILE
and expand [this infrastructure]; both addressing future demand and the needs of the country’s growing economy.” One element of this development, in the transportation sector, is the Go!Durban transit system. It’s a massive project that Hatch Goba has been involved with from the outset, advising on overall strategy development and detailed feasibility study for Phase 1, which will develop the network’s first four corridors—one rail and three rapid-transit bus lines. Over the next 15 years, the current system will be replaced by 90 km of rail rapid transit, 330 km of bus rapid transit, 2200 km of road-based feeder services, 290 km of complementary rail services, 820 km of complementary bus services and a fleet of approximately 4120 vehicles. Of course, alongside the ‘major projects’ that Hatch Goba undertakes, its day-to-day work on smaller projects that require ongoing upgrading and maintenance will remain prominent. Along with work in the construction and mining sectors, Hatch Goba also has extensive proven expertise in the energy and infrastructure industries. Through its work on the
country’s roads, building freeways and bridges, Hatch Goba has built a close relationship with SANRAL and the Department of Roads and Public Works. SANRAL sourced the expertise of Hatch Goba to be the lead consultant on the planning and preliminary design of N3, a section of the Durban Gauteng Corridor, stretching from Paradise Valley, just west of Durban, to Cedara, north of Pietermaritzburg. Because of the nature of the road, it has become something of an accident blackspot in the past few years but all solutions to upgrade or change the situation were not viable. The steep grades and sharp curves as the route descends sharply from the Midlands Plateau to the Coastal Plains of KwaZulu-Natal are what cause the issues so Hatch Goba has developed a new alternative route incorporating viaducts and a tunnel that addresses all the safety concerns while still achieving an acceptable rate of return on investment. “SANRAL has been a key client for Goba, now Hatch Goba, for many years. We have developed a strong relationship with SANRAL and have
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successfully completed numerous high-profile appointments,” says project lead and sponsor, Freek Serton. ENERGY SECTOR The company’s work in the energy industry is vast and has involved projects on major power stations, major solar installations and other utility sites to name just a few. In March, the company talked about its capabilities, saying that it would demonstrate a range of innovative technologies various mining, petrochemical and industrial projects in Africa. Project Engineer from Hatch’s Jo’burg office, Cobus Schutte says the company is confident in a range of solutions including: thermal power generation (including conventional and advanced technologies), cogeneration, gasification (coal, biomass and waste), coal‐to‐liquids and gas quality control (including flue-gas emission reduction, syngas handling, treatment and carbon management). Currently, the company is active a long-term contract with Sasol. “The engineering services that we are providing here on an ongoing basis include materials handling design, machine design and pressure vessel design,” Schutte explains. “Here Hatch is playing a key role in fine-tuning its gasification technology in order to boost its syngas generation and coal-to-liquids business over the next decade. “If you want to talk power generation and energy projects in general, Africa is definitely the place to be,” Schutte comments. “While we are not aware of too many large-scale power generation facilities being erected, there is a lot of focus on own generation, such as remote mines or any kind of production facility.” The company was an important player in the development of two 50 MW solar parks, one near Kimberley and the other near De Aar and in February last year, Colin King, Project Manager, Power Delivery & Integration in Cape Town detailed the impressive undertaking saying: “Our design review covered all of the 22 kV switchgear,
HATCH GOBA
cable networks, protection, control, measurement and SCADA equipment, and civil works for the solar panel terminals. Beyond the traditional OE services, Hatch’s in-depth knowledge of South African standards and legislation added considerable value to the design and construction reviews. We also oversaw specialist third-party testing services.” EMBRACING TECHNOLOGY Like any industry, engineering is one that is constantly changing but particularly in the last decade, the pace of change has increased thanks to the onset of technology. Communication is now instant and people want things done faster. Hatch Goba Regional Director – Eastern Cape, Geoff Mendelowitz explained more about how the industry has advanced when he spoke to 10minuteswith.com.
“The industry has evolved a tremendous amount,”he said.“Now, everything is instant – we email huge drawings across the world in an instant and all the technology jump and change has meant that we have had to jump and change as well. What use to take three weeks, must now be done in a day. We now expect to do a lot more with a lot less so we’ve had to adapt and change. What hasn’t changed is that we still need good, solid engineers to use systems and engineer the best solutions and find the most cost-effective solutions for clients - the fundamentals of engineering remain the same.” Nick van den Berg, Manager of Structures – Eastern Cape, reiterated these points, saying: “Technology is the major factor behind the change in the engineering industry. Price is also a driver. People are looking more at the price of a product rather than quality and the longer term benefits, so we
need to tailor our services to still offer high-quality while being competitive.” With South African Finance Minister, Pravin Gordhan announcing in his budget speech in February that the government will spend R865.4 billion on public infrastructure over the next three years, with a large portion of this going to energy, transport and municipal construction, Hatch Goba is perfectly positioned to ride the economic wave and prosper. The company’s expertise and international knowhow place this company at the forefront of the industry and it will remain there for some time to come
HATCH GOBA +27 11 239 5300 info@hatch.co.za www.hatchgoba.co.za
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EXHIBITION CALENDAR
KEY UPCOMING EVENTS ACROSS THE COUNTRY Our regular update to help you keep track of important events and exhibitions taking place across the spectrum of industry sectors.
//TABLE OF ALL EVENTS: HOSTEX Gallagher Convention Centre, Jo’burg 03-05 May CBM TEC MINING COPPERBELT 2016 Kitwe Showgrounds, Zambia 12-13 May THE WINE SHOW Sandton Convention Centre 12-14 May AFRICAN UTILITY WEEK Cape Town ICC 08-10 May CHINA TRADE WEEK Durban ICC 18-20 May SECUREX SOUTH AFRICA Gallagher Convention Centre, Jo’burg 24-26 May
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WESTERN CAPE FUNDING FAIR 25 MAY 2016 The Western Cape Funding Fair is a partnership between the Department of Economic Development and Tourism and Deloitte, aimed at facilitating face–to-face contact between project promoters, entrepreneurs and various funding institutions within the region. The vision of the Western Cape Funding Fair is to support and promote entrepreneurship and SME business, in order to accelerate business initiatives across the province and provide impetus for job creation. CHINA TRADE WEEK 2016 18 - 20 MAY 2016 China Trade Week (CTW) has so far had successful tradeshows in Nairobi, Kenya and Abu Dhabi, United Arab Emirates. For the first time CTW will be using its expertise and vast
range of industry contacts to present a more controlled environment for long term trade discussions between high-end Chinese manufactures and the regional business leaders and entrepreneurs alike. THE TOPS AT SPAR WINE SHOW 2016 12-14 MAY 2016 The TOPS at SPAR Wine Show Ò Jo’burg is SA’s largest and most influentual consumer wine event. Recognised even by competitors as the wine marketing event to follow, The Show celebrates its 11th year in 2016. Gauteng remains the single biggest market for South African wine, and our format delivers the wine industry an in-depth and an engaging format. Exhibitors are free from restrictions on what and how they market themselves, and the show is especially licensed to allow producers to sell directly to visitors at their own stands.
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WESTERN CAPE FUNDING FAIR Cape Town ICC 25 May
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