Progressing into the Tshwane of Tomorrow

The City of Tshwane has achieved some resounding successes in response to the Covid-19 pandemic, especially in addressing service delivery backlogs and customer payment levels, yet there is potential to unlock greater financial sustainability, explains Empril Mathew*.

Recent City successes include increased meter reading (from 27% in January 2021 to around 80% within six months), improved cash flow vs budget projections (greater than 90% collection levels from lows of 75%), wider credit control efforts, and customer outreach initiatives. The City has thus successfully focused on liquidity improvement measures with key areas of emphasis such as dispute and query resolution, debt collection, customer satisfaction, and business confidence improvement measures.

Despite its success, it may be prudent for the City to further its work towards a more sustainable revenue model and revenue management machinery, especially in light of the sea changes happening within the energy industry.

Cities are confronted with some of the revolutionary changes of the past decade, especially regarding distributed generation (such as solar, generators, etc.), smart metering, tariff/usage monitoring customers, online payment mechanisms, multiple communication mediums, and social media platforms. This calls for cautious planning to prepare the municipality for the ‘business of tomorrow’.

Consequently, it is important to consider each element of the value chain and determine the people, data, system and/or process improvements that need to be looked into holistically and addressed in an integrated manner.

Customer-centricity

A fundamental element is placing the customer at the centre of the City’s role as a business, while also transitioning to a ‘caring’ city. The speedy resolution of queries and disputes and improving services or service delivery are central to keeping customers satisfied. Improved customer satisfaction has proven to translate into increased payments. Importantly, keeping the customers happy implies the City will have processes, systems and the required skills to deal with potential servicedeliveryrelated interruptions expediently, while keeping customers informed of progress towards resolving such issues. Therefore, technology is essential, particularly in tracking issue resolution and proactively providing progress updates to City customers. For instance, an integrated communication platform entails attaining a high-impact communication capability and analytical ability that combines multiple communication channels (calls, emails, messages, social media), thus enabling customers to be kept up to date with their accounts and status updates related to their queries/disputes. Further, strategies need to be put in place to elevate internal communications, fostering better internal working cohesion and converting City employees into brand ambassadors.

Alternative revenue sources are also crucial to guaranteeing the future financial sustainability of the City. It is worth noting that the increase in self-generation threshold to 100 MW presents the City with an opportunity to hedge its electricity purchase costs, diversify its sources of energy supply, and mitigate against the risk of load-shedding.

In summary

The aforementioned strides are expected to cut across multiple elements of the value chain; with the ultimate focus on cash flow improvements and debt book reduction in addition to optimising all existing sources of revenue (including tariffs/property rates), generating additional revenues, enforcing stricter credit control and revenue protection measures, and improving the levels of customer satisfaction. It therefore presents an excellent opportunity for the City to further itself with concrete time-bound actions; and thereby, progressively transition towards a ‘world class capital city’!

*Associate Partner: Ntiyiso Revenue Consulting