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EMEA EDITION November 2012

basil read:

The sky’s the limit


M2M: Not just for B2B

Ceské Radiokomunikace: Making waves

Express improvement How DHL Express Pakistan has become the best company to work for in Pakistan

industry focus: Oil & gas in South Africa

Editor’s letter

Oil & gas


n this issue we turn our focus to oil & gas. There is much to be done to maximize the potential of Iraq’s oil & gas reserves, but you can read here how the State Company for Oil Products (SCOP) is showing how complex engineering projects can be delivered in a challenging environment. This month also sees the first instalment of our ongoing focus on the oil & gas sector in South Africa, through the members of the South African Oil & Gas Alliance. Experienced service providers like Filcon Filters, Hesper Engineering and Sturrock Shipping are turning their attention to oil & gas, while One Eighty Engineering Solutions is opening a new materials testing centre to provide local specialised services. In transport and logistics we have a world class improvement story from DHL Express Pakistan, and growth strategies based on diversity from Flinders Ports and Strategic Marine in Australia, as well as a program of expansion at the South African coach services company Intercape.

M.Ashcroft Martin Ashcroft Editor-in-chief mashcroft@bus-ex.com


David Walton is chief executive of specialist change management consultancy Bestoutcome.

Carol Mote

Carol Mote is head of technology and strategic change at executive search consultancy Tyzack Partners.

Simon Orme

Managing director of Emros Partners, helping technology companies develop and implement their growth strategies.

Mark Forrest

General manager of Trimble’s Field Service Management Division, providing visibility into field and fleet operations.

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12 Comment: Technology

Ageing legacy systems hold back European business

Many businesses have been focusing on new technology for the front office while failing to integrate it with the back office.

14 Leadership

Authentic leaders

Leaders under pressure must put people first, ensuring that everyone in the company is clear on their role and purpose.

20 Change management

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Shareholder value at risk

CEOs should focus on shareholder value at risk in managing major change programmes, says David Walton.

contents 26 Technology

Digital footprints

Technology development can often outpace an organisation’s ability to harness its opportunities. The stage is set for the digital director.

32 Operations

Managing in the field

Investment in field service management technology can help streamline business processes.

40 Crisis management

40 32

Crisis? What Crisis?

If not managed correctly, a crisis can spell the end for a company’s brand reputation, says Simon Orme.


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in touch EDITORIAL

Martin Ashcroft Editor In Chief mashcroft@bus-ex.com Will Daynes editor wdaynes@bus-ex.com


Matt Johnson Art Director mjohnson@bus-ex.com Louise Culling Production Designer lculling@bus-ex.com


Richard Turner Director of sales rturner@bus-ex.com Vince Kielty Director of Editorial Research vkielty@bus-ex.com Sharon Rooke Administration & Operations srooke@bus-ex.com Matt Day Head of technology mday@bus-ex.com Andy Turner Chief Executive aturner@bus-ex.com


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business showcase


industry focus: Oil & gas in South Africa


46 South African Oil & Gas Alliance Waiting in the wings

South Africa is ideally placed to play a key role in the next big expansion of Africa’s oil and gas production.

54 Hesper Engineering A reputation earned

With more than 40 years of ship repair experience, this SAOGA member is looking to expand into the oil and gas sector.


62 Sturrock Shipping The know-how people

Nothing would ever get done in oil and gas production without the support of experienced service providers.

72 One Eighty Engineering Solutions Passing the test

The opening of a new materials testing centre will provide local specialised services to South Africa’s oil and gas sector.

82 Filcon Filters An ambitious target


This South Africa-based company has set an ambitious target of 25 percent annual growth over the next three years.


business showcase



Transport & logistics: 90 DHL Express Pakistan Express improvement

DHL Express Pakistan was recognised by its parent company as the best performing operation in Asia this year.

102 Flinders Ports

Overcoming adversity with diversity Andrew Pellizarri of Flinders Logistics and Peter Cheers of Flinders Adelaide Container Terminal, on adapting to evolve.

114 Strategic Marine Uncompromised quality

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The diversification of the company has helped it become globally recognised as a builder of first-class vessels.



122 Basil Read

The sky’s the limit An exclusive interview about the challenges and benefits of the St Helena airport project.

140 Intercape

Growing new routes A program of expansion at the South African coach services company.

150 Port of Dar es Salaam Handled with care

The port makes a huge contribution to Tanzania’s growth.

160 Port of Subic Bay Attracting investment

The first free port of its kind in the Philippines has become an area of significant economic importance.




Delivering the goods Now a leading logistics organisation, playing its part in the development of Mozambique.

Telecoms: 174 ceské Radiokomunikace

Making waves

Providing a full range of voice, data and internet services across the Czech Republic.


business showcase 184 Telefónica

M2M: not just for B2B This Spanish telecoms giant is taking full advantage of machine to machine (M2M) technology.

192 Sri Lanka Telecom Connecting a nation


How the company is helping transform Sri Lanka into an information and telecommunications hotspot.

202 Spanco: Respondez Answering the call

The Respondez brand is introducing Spanco’s outsourcing solutions to Africa.



212 Kenya Vehicle Manufacturers

On the road to growth

How KVM is attracting the interest of some of the major OEMs in the automotive industry.

220 Drytech International The optimum dryer

An extensive in-house technology base covering the full spectrum of industry.

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222 Innovative Magnetic Technologies Custom manufacture

Innovative magnetic equipment for industrial markets

contents Oil & Gas:


224 State Company for Oil Products (Iraq)

All about oil

SCOP shows how complex engineering projects can be delivered in a challenging environment.

236 Progetti Europa & Global (PEG)


Straight and true

An engineering company that has made a name for itself in the Middle Eastern oil business by playing it straight.

Mining & minerals: 242 SouthGobi Resources


Coal for China

Mongolia has a wealth of coal and a booming mining sector. It’s also conveniently located on China’s doorstep.

Retail: 256 Sasini

Anyone for coffee? A Kenyan tea and coffee producer growing by diversification into retail, and is cutting costs by generating its own electricity.

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by: David Mills

Ageing legacy systems hold back European business

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geing back office legacy systems are holding back 79 per cent of European businesses from fully streamlining their business critical document processes, according to new research published by Ricoh Europe. This is despite the majority of businesses recognising the transformational power of new technologies to help them be more agile in a fast-changing market, and highlights the disconnected approach to business technology and businesscritical document processes across Europe today. The research, part two of the Ricoh Document Governance Index 2012, reveals that while European businesses say that new devices such as smartphones and tablets are helping them manage their business critical document processes, the majority are unable to maximise such technologies because their back-end systems can’t fully support them. The study highlights how tempting new technologies can be, with 78

comment: Technology per cent of business leaders admitting they invest in new technology before fully realising the functionality of their existing systems. It also uncovered a clear divide between front and back office technology investments, with many focusing on new technology for the front office while failing to integrate it with the back office. This disjointed approach to process management could mean document processes are exposed to bottle necks, duplication of effort, and security risk. “Whether businesses believe tablets and smartphones are the business tools of the future, or will be superseded by the next wave of innovation, it’s clear is that technology driven change will continue and with it bring new ways of working and communicating,” says David Mills, COO, Ricoh Europe. “For business, the challenge is to plan for the long term and bring everyone in the organisation on the same journey at the same time. That means fully integrating the front and back office, connecting people with information,

70% European businesses using the cloud

and enabling collaboration and knowledge sharing seamlessly throughout the organisation.” The research also indicated confusion about how to use the cloud for business advantage. While 70 per cent of European businesses are using the cloud to enable mobile access to document processes, only 50 per cent believe that it is making their document process management easier. This highlights the lack of planning by business leaders who are investing in the cloud without having the structures in place to ensure it will deliver the desired improvements. It also means

that many businesses will fail to benefit from their share of the predicted annual boost of €160 billion that the European Commission predicts cloud computing will add to the European Union’s GDP by 2020. “European organisations must take action now to review their business critical process and technology in tandem to ensure their businesses are working to maximum efficiency,” concludes Mills. “A deep understanding of how document processes work – including how information flows through a company and how technology can help that information flow more smoothly – is crucial to truly understand the challenges and identify solutions. Technolog y innovation is set to continue at an unprecedented rate, so businesses need to act now if they are to keep ahead of the competition.”

The report was conducted on behalf of Ricoh by Coleman Parkes Research and has been compiled using 1,075 interviews amongst C-level executives, directors and other employees in Europe. www.thoughtleadership.ricoh-europe.com

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leaders Leaders under pressure must put people first, ensuring that everyone in the company is clear on their role and purpose, and is working together to achieve the business goals written by: Gareth Chick

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sur vey in the US by administrative staffing firm Office Team in June this year found that nearly half of all employees say they have a bad boss. Some 55 percent of those said they dealt with it by trying to improve the situation or just suffering through, with 38 percent saying they left the company either immediately or as soon as they had lined up a new job. According to US workplace expert and author Lynn Taylor, many people waste a lot of time stressing out about bad bosses, with employees on average spending about 19.2 hours a week worrying about “what a boss says or does” – with 13 of these hours being during the working week. Either way, people leaving a company or simply not being focused on their job because of bad leadership is going to cost a business in the long run. A white paper published last year from The Ken Blanchard Companies revealed that poor leadership is costing the

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average company in the US seven percent of its annual revenue, or over a million dollars a year for organisations with $15 million dollars or more in annual sales. The news isn’t much better for bosses in the UK, with a recent CIPD report highlighting that three quarters of employees think their bosses lack leadership and management skills.

80% Managers who think their employees are satisfied with their leadership Research published last year by talent management consultancy DDI, and the Chartered Institute of Personnel and Development (CIPD) in August also threw an equally dim light on some of the leadership in UK organisations. Only a third (36 percent) of UK leaders and one in five (18 percent) UK HR professionals rate the quality of leadership as

‘high’ in their organisations and just four out of ten leaders said their company had an effective strategy for leadership development. This research highlights how many businesses around the world are struggling under ineffectual leadership and lacking a strategy for developing future leaders, thereby allowing the situation to get worse. What is often overlooked is the fact that people are not born great leaders— leadership skills can be taught—which begs the question why ineffectual leadership is still tolerated. Sadly, you can see poor leadership at work in any country in the world, from the autocrat who drives fear into employees to obey his commands to the inclusive ‘Mr Nice Guy’ who defers decisions to others so often that nothing gets done and no-one knows what they should be doing. What makes a good boss? Companies need to strive for authentic leadership. Like the inclusive leader, authentic leaders don’t do everything themselves, looking to others to provide


Leadership skills can be taught

answers—but they provide the vision first. They set big goals and crucially trust people to make them happen, and they are not motivated by being liked. They are passionate, great communicators and share openly the vision for the business and if it needs changing, they get people together, share the facts and get them to design the new strategy, gaining strength and unity from teamwork.

Good leaders don’t waver on big decisions. They honour their company’s roots and try and recapture the enthusiasm and passion that started the company. Anyone can learn these skills. The current high pressured trading environment has led to many leaders taking their eye off the ball. Many have neglected the development of their people to focus on immediate business pressures. Consequently,

People need direction and development

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their teams have been left without direction and clear goals—a cardinal sin in leadership. It also seems that leaders are deluded about their own performance. Eighty percent of managers think their employees are satisfied with them as a leader, but just 58 percent of employees agree. This is a major disconnect. Under pressure, leaders tend to resort to controlling behaviour, so


“People in the business need to be out of their comfort zone, but it needs to feel exciting rather than scary, and they need direction and development” long term planning and a focus on people go out the window. It is clear that leaders need to rethink both their leadership style and the impact it has on their employees.

They need to recognise that their controlling behaviour is making the situation worse; yes, people in the business need to be out of their comfort zone, but it needs to feel exciting rather than scary, and they need direction and development. Many business leaders need to change the way they behave. If they are feeling the pressure, they must never show it. Good leadership is about putting the people in the business first and prioritising them over any problem. This means recognising that a problem is just today’s issue and the people are

the business—they matter more. And, while the leader’s job is tough, they are being paid well. Additionally, leaders need to demonstrate the right way to behave at all times and teach people around them their ethics, values and demonstrate their integrity. They need to remind everyone of the mission, values and goals of the business and communicate these at all times. They should be evangelists and ensure everyone in the company is clear on their role and purpose, and is working together to achieve the business goals.

Gareth Chick is co-founder and director of Spring Partnerships, a UK business consultancy specialising in leadership and marketing communications. Gareth specialises in cultural change and leadership development, heading clients such as Carlsberg, Disney, Nestlé, BMW, Wickes, Premier Foods, Dixons, Iron Mountain and Kingfisher. www.spring-partnerships.com

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value at risk CEOs should focus on shareholder value at risk in managing major change programmes written by: David Walton

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Change management

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Change never ends and therefore the risk to shareholder value is constant

Change management


very major change management programme puts shareholder value at risk. If the project succeeds and meets its objectives, then shareholders benefit. If it fails or even partially fails, then the value of the company may fall and keep falling. And CEOs don’t usually survive such an outcome. Ask any programme sponsor what the biggest threats are to a major project and you are likely to get similar answers: a lack of leadership and drive and not enough focus on business risk. Take the recent example of G4S’s catastrophic failure to deliver against the terms of its security contract for the London 2012 Olympics. An unmitigated business risk issue if ever there was one. In just a few weeks, the company lost 14 per cent of its value. In fact these two issues— managing shareholder risk throughout the duration of a project and top-down, active engagement by the CEO—are inextricably linked and are crucial

components of change in an era when intense and significant transition has become a permanent characteristic of so many large corporations. Change never ends and therefore the risk to shareholder value is constant. It follows, therefore, that the CEO must lead change by focusing on shareholder risk. One of the biggest problems in major change management projects is what

14% Value lost by G4S after London 2012 Olympics could be called a ‘Bermuda Triangle’ communications failure that occurs between programme director, sponsor and CEO. The programme director and sponsor are often reluctant to raise issues or red flags to the CEO; they see themselves as being responsible for dealing with problems as they occur. And that suits most CEOs just fine. They like green traffic lights.

But if the communication bet ween prog ra mme director, sponsor and CEO was focused on business risk so that problems and issues within the programme were examined in terms of shareholder value at risk, they immediately become more vital to the CEO. In this way, the CEO becomes actively engaged and the top-level communications problem is resolved. So how do you make this happen? What do you need to deliver this focus on shareholder value at risk? Too often there is a yawning gap between the CEO’s vision and the nuts and bolts of a programme to deliver it. A focus on business risk presented in terms that the CEO recognises and can engage with allows that gap to be bridged. At the heart of this should be a change map, with clear goals, key milestones and a focus on some of the softer issues such as the ability of individual departments to do what’s being asked of them. This ensures a culture of openness and honesty from top to bottom. It’s essential to have

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accurate data and a system that ensures transparent, visible and objective reporting. That means one toolset that everyone understands, trusts and uses. Too many project management solutions prove so complex and opaque that only technical specialists can drive them. This simply encourages a culture of ‘green light’ reporting: trying to fix problems behind the scenes and not highlighting milestone risks, often until it’s too late to do anything about them. Like it or not, big change normally demands external help. You need systems integrators, a change methodology and supporting project ma nagement software. Tempting as it may be to follow the best of breed approach to selecting these partners, it tends to work directly against openness, transparency and effective

risk management. There are very significant advantages to engaging a niche change management team that has proven experience of your sector or industry. A specialist team should also be able to provide the methodology and the toolset to deliver the change map and desired outcomes. Opting for a specialist team that can provide an integrated approach will enable better data transparency, objectivity and appropriate risk management at each level— from top-level shareholder at risk and down. Big system project management tools typically prove counterproductive in practice. They are costly to run, are often underused and tend to distract from the real issues of risk management—risk mitigation, transparency and openness. Indeed, they

often end up being used for little more than timesheet management. What’s needed instead is an elegant, easily understood toolset that guarantees objectivity, engenders honesty from top to bottom and gives senior people risk data in an accessible and concise format (i.e.

“Like change itself, the process of managing change requires continuous progression and innovation” 24 | BE emea

Change management

CEOs need to be able to see how shareholder value is being protected

management dashboard). The CEO needs to know when shareholder value may be at risk. They need to know what actions are being taken to mitigate this risk and whether a programme is actually on track or not. The best toolsets are those built by the specialists themselves, as they are based on many years of practical experience in delivering major change programmes and will reflect the need for risk management and mitigation at every level. Like change itself, the process of managing

change requires continuous progression and innovation. Whether the programme is part of a corporate relo c at ion , merger/ demerger, re-engineering of the operating model or a technology migration, change is an essential and inescapable part of business. For this reason, CEOs

and all senior management need to be able to see how shareholder value is being protected. That requirement demands a team of people, a methodology and a toolset that are all founded on data transparency, accuracy, openness and objectivity. Proper risk management is impossible without them.

David Walton is chief executive of specialist change management consultancy Bestoutcome, which he founded in 2000 after spending 11 years as a management consultant with PricewaterhouseCoopers. www.bestoutcome.com

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Digital footprints Technology development can often outpace an organisation’s ability to harness its opportunities. The stage is set for the digital director written by: Carol Mote

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he globa l technology research and advisory firm Forrester faced a dilemma of unknown proportions back in August 2009 when one of its key strateg ists, Jeremiah Owyang, left the company for pastures new. While movement of people is a natural and regular occurrence for a business, when Owyang left Forrester he took with him his digital identity. During his employment with Forrester, Owyang had generated and cultivated extensive social media connections. The long tail effect of his personal blog alone was massive as he had worked as a very thorough and systematic aggregator. Forrester, like most major companies back in 2009, was seemingly unaware of the legacy impact of such a departure on the connectivity with their clients and business interests. Fast forward to 2012 and it remains the case that many international organisations are still unsure how best to leverage and secure the

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personal digital footprints of their employees. Many aspects of an employee’s digital footprint originate from their employment connections and may have reference to, and have been generated in, their working environment. While much has been said in the last decade about carbon footprints, the next decade is likely to see increasing interest in digital footprint identity and the complex implications of ownership. A digital footprint refers to the interactions linked to an identity (individual, team, group or corporate) across a wide range of digital applications from the internet, including the dynamic flow of information through social activity streams and mobile phone connectivity. Complexity is added by the increased preference of individuals in many organisations to use their own devices for work, subjecting ownership of socially related business activity and connections to debate. An individual’s digital footprint is measured by

“When Ow Forrester h him his digit

Many aspects of an employee’s digital from their employment connections

Owyang left he took with tal identity”

l footprint originate

Technology the extent of their online activ it y. Work-ba sed connections generated via social media remain long after an individual leaves a company. Post-employment, while they may not directly approach individuals (to do so may contravene their contract of employment), people will remain visible, connected and accessible via social media connections. O w nership of a company’s digital footprint is predominately focused within the remit of the CIO function, linking it to technological connectivity. However, this is a rapidly evolving arena where aspects of the digital footprint also encompass areas such as marketing and sales channels, in addition to internal communications. With such a broad spectrum of bu si nes s -rel ate d implications, there is a new remit arising which may transcend the experience of incumbent individuals and organisational expertise. The concept of ‘digital directors’ is emerging as organisations start to recognise the full impact of a robust, dynamic flow of

information across business interests and through social activity streams. These individuals will act in the capacity of ‘intrepreneur’, harnessing CIO and wider corporate knowledge with market dynamics to deliver business advantage (at a corporate and individual level), while managing internal and external digital risks. Digital directors may be sourced from the CIO community, online trading organisations with a track record of success, social media organisations or perhaps digital marketing agencies. As with emerging market areas, investment is required at the front-end of experience and firms should anticipate a three to five year window for strategic delivery. The best strategy may be to recruit two or three directors with variable remits and focus which will maximise early returns and allow the opportunity for the prime contender to emerge within an 18 month window. This is pioneering territory where new language needs to be created that balances:

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• the support and empowerment of the business to deliver its remit; • the support and empowerment of employees to deliver their remit; • monitoring content to ensure corporate values and strategies are upheld; and • securing the knowledgebased connections created throughout the work environment for corporate benefit. Digital directors will be required to “own” the digital

agenda and be accountable for the organisation’s digital identity (both corporate and individual). Their key expertise will be to assuage institutional fear of loss of control, transitioning this through culture change dynamics to create an enabled, empowered workforce who are the company’s daily ambassadors. As witnessed all too regularly, Twitter, Facebook, YouTube and evolving media such as Pinterest and Google+, demand immediate

attention, often resulting in inappropriate responses potentially ‘going viral’. These cause significant bra nd m a n a g ement challenges, particularly where negative social media activities adversely affect trading. Successf u l d ig it a l directors will have ‘digitally safe’ and experienced hands, being able to make things happen quickly and accurately for an organisation, aligning their agenda and environment

Work-based connections generated via social media remain long after an individual leaves a company

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“The next decade is likely to see increasing interest in digital footprint identity and the complex implications of ownership” and stretching their market reach. These individuals will be smart, emotionally intelligent and intuitive, and be able to articulate a vision, harness internal cooperation and knowledge while delivering excellence in digital credibility. Digital

directors will articulate a compelling story of digital evolution, cross-cultural transitions and territorial capture. The best will create connections on an individual level, even in the midst of volume traffic. The stakes are high and errors will be made. However, robust digital connectivity should ensure the construction of a ‘grid-safe’ environment to calibrate risks, ensuring speed and appropriateness of response to negative impacts. The digital reach of employees such as Owyang are, for many organisations, still undervalued but (hopefully) will not remain so for much longer. Those

who know how to combine what exists now with a vision for the future position of a company on the digital highway, will soon be increasingly in demand. The pace of technology development continues to increase rapidly, often outpacing an organisation’s abilit y to ha rness opportunities. In the coming years, it is likely that companies will seek and promote digital directors to hold and apply a vision to leverage capacity and opportunity, and to stay ahead of the competition. This is definitely an era where combining a series of skill sets in a new and innovative way is a valuable investment.

A specialist in technology and strategic change, Carol Mote has worked for many prestigious organisations such as JP Morgan, Unilever, British Airways, Lloyds TSB, IBM Europe and EDF Energy before joining Tyzack Partners in 2012.

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Managing in the field Investment in field service management technology can help streamline business processes, leading to long-term efficiency, profitability and customer retention written by: Mark Forrest

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perations managers face evermounting internal and external challenges to achieving business excellence. Customer expectations are at an all-time high, and field services play a major role in customer satisfaction, brand reputation and ultimately customer retention and profitability. Adding to this, unpredictable fuel prices, incoming legislative requ irement s a nd environmental concerns make this a challenging time to run a service operation. Maintaining efficient field-based operations is essential for any business to remain competitive and investment in technology can help to achieve this. A solution which boosts productivity while reducing costs ensures a business achieves a genuine return on investment (ROI), including improvements in workforce productivity and customer satisfaction. Trimble recently carried out an independent study among directors and senior

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managers operating large field-based work forces in the UK and found that only 18 percent possess fully automated scheduling, dispatch and mobility tools. The majority are operating partly-manual, partly-automated systems, integrating a diverse mix of often incompatible legacy systems. This is preventing many organisations from realising the full potential of technology to increase workforce efficiency, a crucial factor in achieving field service excellence. The rise of intelligent data Fleet management and telematics have emerged as powerful management tools to provide new levels of field service and vehicle fleet performance. Today’s solutions integrate GPS with wireless communication to enable every aspect of mobile operations to be identified, measured and analysed, delivering greater intelligence to fleet managers. Th e i n f or m a t ion typically includes vehicle location, speed and time,

UK motorway traffic


“Operations managers require a clear understanding of what is happening in the field to monitor performance” but may also include work order information, driver behaviour and vehicle diagnostics data such as miles-per-gallon, fuel use or vehicle faults, all determined by the in-vehicle telematics. Businesses can then start to reduce direct expenses such as fuel costs by optimising route planning, improving operational efficiencies and driving revenue generation through top quality customer service and maximum flexibility, making realtime decisions to keep their operations running as smoothly as possible. According to the research, organisations running fieldbased workforces cited fleet management as one of the top priorities for future technology investment and upgrades. Operations managers require a clear understanding of what is

happening in the field to monitor performance and a work management solution provides real-time job status of each mobile worker as well as alerts for proactively managing productivity. If a job is in jeopardy of being missed or a customer emergency comes up, modern work management solutions mean these are automatically highlighted by the technology and a proposed solution put forward as to how to redeploy resources to meet the new requirements. The capabilities and benefits that can be achieved include: • Optimising and automating mobile work schedules. • Communicating to mobile workers via a laptop or smart phone so they can view work details, provide current work status and

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receive work assignments without returning to the office. • Monitoring arrival times, distances travelled, stops made and overtime usage. • Comparing planned vs. actual work done per day/ shift. • Adjusting schedules and reassigning work. The above capabilities evidently lead directly to increased customer satisfaction due to increased on-time service delivery performance and reduced customer complaints for late technicians or missed appoint ment s. Once you start comparing the information taken from your field operations regularly it is easy to see where improvements can be made or where patterns exist that you can plan for in advance to minimise the impact.

Driver behaviour and vehicle diagnostics information are now available

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Managing the worker and mitigating risk Health and safety is understandably a high priority for organisations with field-based workers, especially those doing


TDI 100 - Installed

a significant amount of driving. These individuals not only face greater risks than office-based employees, but can also expose members of the public to danger through aggressive and unsafe driving, with disastrous consequences for the compa ny ’s reputation as well as the legal risks involved. As technolog y has evolved, both the amount

and type of data gathered has increased significantly. Driver behaviour and vehicle diagnostics information are now available to identify how a vehicle is being driven and any faults that may affect performance. Taking steps to mitigate poor driving or proactively servicing underperforming vehicles not only significantly reduces the road risk but minimises vehicle breakdowns or

unscheduled downtime. Trimble’s resea rch discovered that 51 percent surveyed agree that the technology they are using to manage the safety of their employees is in need of updating, with 44 per cent stating that their risk assessment software is in need of the most improvement. Driver safety solutions enable managers to

“As technology has evolved, both the amount and type of data gathered has increased significantly” BE emea | 37

monitor driving behaviour and complete back office analysis of aggressive manoeuvres, such as hard acceleration, braking, turns and speed. With this data at hand, recommendations on training can be made for individual drivers, resulting in lower accidents and liability and therefore helping to manage the risks and costs associated with work-related driving. Essentially, technology can be used to improve the efficiency of, rather than completely replace, health and safety policies, while also helping to increase efficiency, cut costs and help maintain a brand’s reputation of executing a safe driving culture. Going green and cutting costs Introduced and incoming legislation has placed mounting pressure on

businesses to improve their sustainability and accelerate the move to meet green targets. For field-based organisations especially, monitoring fuel consumption through f leet management and telematics is a quickly achievable method of reaching environmentally friendly targets. Fuel prices have seen a consistent increase over the years and business owners have become very conscious of managing these costs. Reducing fuel usage through data interpretation can result in significant cost savings and will additionally lead to a reduction in CO2 emissions. Cost is a major barrier to rolling out new technology but t he increa sed sustainability credentials derived from the financial a nd env i r on ment a l

advantages are key benefits that inf luence business decisions. Trimble’s recent research shows that nearly two thirds of respondents believe that sustainability plays a key role in their business plan and a further 64 percent feel sustainability will have a

“Reducing fuel usage through data interpretation can result in significant cost savings” 38 | BE emea


Driver safety solutions enable managers to monitor driving behaviour

significant effect on their business moving forward. The desire to become more sustainable is also largely driven by perception and company image, as being green, and being seen to be green in the public eye, is becoming increasingly important. For wa rd-thinking businesses are moving towards sustainability as a way of promoting their organisation and ultimately to attract and retain new customers. There are a multitude

of solutions available to help streamline field service operations. The challenge now is educating organisations on the extended benefits such technologies can deliver and helping them to overcome any reluctance to invest, due to economic hard times.

Fundamentally, enabling drivers to do their job more efficiently, effectively and safely through the deployment of field and fleet management technologies facilitates lower cost and better service, leading to long-term success for the entire business.

Mark Forrest is general manager of Trimble’s Field Service Management Division, which provides visibility into field and fleet operations so businesses can streamline efficiency and increase productivity. For more information visit: www.trimble.com/fsm

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Crisis? What Crisis? Crises are for multinationals, aren’t they? It could never happen to you, could it? If not managed correctly, however, a crisis can spell the end for a company’s brand reputation written by: Simon Orme

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Crisis management

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here have been plenty of highprofile crises in the media over the last few months. In the UK we have had the phone hacking scandal and the recent Barclay’s Libor-fixing debacle to name but two. As we watch the media dissect these cases and inform the world of every last detail, it’s hard to imagine ourselves being in such a position. The crises we have seen of late have involved huge, multinational enterprises so if you are a smaller organisation, you could be forgiven for thinking this could never happen to you. However, all businesses are at risk of crises – they can happen to anyone at any time. If not managed correctly, a crisis can spell the end for a company’s brand reputation. Avoiding a crisis completely is not

always possible, so what can you do to limit the damage? And what exactly constitutes a crisis? Managers perform their roles in environments over which they do not have absolute control. From time to time life throws them a curve ball which causes disruption to their orderly lives. When the disruption is severe, they become exposed to a crisis. Characteristics of a crisis Crises can have a serious impact upon the organisation or individual manager. They can arise from external or internal events, but they have a number of common characteristics. They are most often unexpected, their causes are not always obvious, their outcomes tend to be unpredictable, but above all, they require immediate attention—an

“When a crisis arises it has a similar impact to being told that one has a serious disease” 42 | BE emea

Crises can have a serious impact upon organisation or individual manager

n the

Crisis management unattended crisis can lead to disaster. External events include market shifts, regulative impacts, competitor actions, customer events and economic factors. Internal events include product failure, staff resignations, technical problems, cash shortage and sales failures. When a crisis arises it has a similar impact to being told that one has a serious disease. Reactions include: • Shock – how did this happen? • Defensive denial – I don’t believe it! • Acknowledgement – so what does it mean? • Adaptation and change – so how do I fix it? These are human reactions that occur in any crisis. The first point is to recognise their existence and the second is to decide how to manage them. The other aspect to recognise is that crises are part and parcel of the life of a manager; they occur with some regularity due to the fact that management is an art not a science. Behavioural scientists

have identified three stages in crisis management: • Pre-crisis: the period leading up to the actual crisis. Although most crises are described as being unexpected events there are generally indicative signs that a crisis is looming. Unfortunately these signs are frequently ignored. A useful management technique is to ask the question – ‘if this set of events continues what will be the outcome?’ This is crisis avoidance and is much preferable to crisis management. • Crisis: where the pre-crisis signs have been ignored or the event was entirely unpredictable before the crisis stage is reached. • Post crisis: the typical post crisis stage is characterised by recrimination. This takes a number of forms ranging from personal acceptance of failure to shedding the blame on others. The important dimension is to ‘learn lessons’ from the crisis and take steps and actions to seek to ensure that it does not occur again. Some ma nagement thinkers maintain that a manager has not fully

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matured in the job until a crisis has been experienced and coped with. Managing a crisis A crisis is often caused by operational failure – quality management, market analysis, poor people management, sales performance or inadequate c a sh m a n a g em ent . Whatever the cause, the first stage of crisis management is impact analysis. I have found it useful to develop three impact scenarios:

• Direct impact – what it does to my area of responsibility • Indirect impact – what it will do to the company • Disaster impact – the worst case scenario – if it all goes wrong. By taking a cold look at the impact in this way, it becomes possible to identify the range of corrective actions needed. Just fixing the direct impact may cause further crises to occur in the future – beware of the ‘quick fix’ approach. The financial crisis we’re still going

Crisis avoidance is much preferable to crisis management

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through now demonstrates what happens when a ‘patch-and-go’ approach is taken – the sacking of Fred Goodwin from RBS for example, kept the public happy for a while, but RBS failed to do anything about the huge pension and reward scheme in operation, leaving the banks vulnerable to greedy fat cats and public outrage. Following on from this, the effect analysis will help to identify the actions that need to be taken. As an

Crisis management

“Any major crisis will have a large audience—bad news travels” example – I once had a crisis caused by the failure to win a large deal. This would have insulated our profit target for the year. We confidently expected to win the order, but at the last moment, the prospect was acquired by another company and the deal was cancelled. The impact analysis was

about the effect of the loss of revenue, but the effect analysis told a bigger story – without the expected revenue, we could breach our banking facilities and could go bust. I had to cut headcount immediately to avoid this and introduce an austerity programme – I also had to find a replacement opportunity very quickly so there was huge pressure put on the sales team. Impact identifies what has happened, effect identifies what it means. Communication and problem resolution Any major crisis will have a large audience—bad news travels. The immediate and natural response to a crisis is denial, but a better strategy is open and honest recognition of the problem, coupled with a statement about how it will be dealt with. This is the next step in crisis management

– problem resolution. Clearly this will depend upon the nature of the crisis but the key point is to let all involved know that the problem is being addressed and that it has high priority. Attempts at cover-up almost always fail and tend to make the crisis bigger. The final stage in crisis management is reconciliation. All parties affected by the crisis need to be kept in touch with the resolution actions, along with regular progress reports and action plans. Once the problem has been solved, it is important to let all who have been affected by the crisis know, and inform them that measures have been taken to ensure this doesn’t happen again in future. Simon Orme is the managing director of Emros Partners. www.emrospartners.com

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Industry focus: SA oil & GAs

Waiting in the wings

The next big expansion of Africa’s oil and gas production will be on the east, and South Africa is ideally placed to play a key role in its support and development written by: Alan Swaby research by: James Boyle

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South African Oil & Gas Alliance

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Oil rig in the ocean bay of Cape Town, South Africa

South African Oil & Gas Alliance


or all South Africa’s undoubted bounties in terms of minable minerals, the same can’t be said for its oil & gas resources—at least not yet. “Take a look at the map of exploration leases,” says Warwick Blyth, executive director of the South African Oil & Gas Alliance (SAOGA), “and you will see that there is little or nothing left to be bagged by exploration companies, which is a considerable change over a year ago. Nevertheless, while South Africa’s most significant production area in Mossel Bay is winding down, the rest of the country essentially remains in the early exploration stage. There is a lot of activity but tangible results are some years away.” That doesn’t mean, though, that the industry is in hiatus. Oil & gas projects are going full steam ahead in neighbouring countries and SAOGA is deeply involved in ensuring that South African companies get a share of the action. SAOGA is a non-profit organisation representing the interests of South Africabased suppliers of upstream products and services to the oil and gas industry. It currently has a membership of around 170, many of which are local operations of foreign companies. “We are realistic enough,” says Blyth, “to realise that although the country has some very capable engineering and manufacturing companies, they don’t have the experience, resources or clout to be considered as tier one suppliers. Therefore we need the involvement of overseas specialist suppliers and that’s why SAOGA is

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Show the world what your company has to offer with our tailored packages

Seen www.bus-ex.com

South African Oil & Gas Alliance

SAOGA is working on a definitive directory of local companies suitable for potential oil & gas projects

open to any business which has a base here.” African foothold. In this respect, SAOGA With signed-off projects in Mozambique is taking a proactive role by talking to and Tanzania, the race is on to get geared its opposite numbers in the UK, US and up. “These projects are located in totally Norway, actively working towards alliances undeveloped regions of Africa,” says Blyth. of one kind or another. “The aim is not to “There is literally nothing there. Everything provide takeover targets,” says Blyth, “but will have to be built in order to make the rather to bring together overseas operations projects work—harbours, road and rail links, which complement local businesses and offices, warehouses. We might not be eligible then it is up to the parties involved to decide to supply the most critical equipment needed how that partnership might be formed.” To facilitate this meeting on production platforms or LPG plants but there is an of minds, SAOGA is working enormous amount of support on a definitive directory of work that we can do.” local companies with the capabilities suitable for The last 12 months has also seen a spate of potential oil & gas projects. Member companies acquisitions as overseas In this respect, the value of SAOGA specialists seek to gain an chain is much longer than


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might initially be considered. “The whole process starts with the acquisition of licences, which calls for legal and business consultancy services familiar with the way different African governments and their licensing authorities work. Then there are all the services related to exploration which cover the full spectrum from seismic vessels to food provision and security. Boats and equipment need to be repaired and maintained. The list is endless and anyone serious about being in the oil & gas business should be represented in our directory.” The most advanced of the Mozambique projects is the Anadarko LPG project which could become one of the half dozen largest fields anywhere in the world. Although construction is at least 12 months away, Blyth is conscious that there is plenty to do preparing the land and sea for the eventual extraction process and is keen that his members play a part. The other great initiative occupying SAOGA, and which is inextricably linked to any oil & gas developments whether in South Africa or further afield, is the creation of a “free zone” based around the Western Cape port of Saldanha Bay. “It remains to be fully worked out,” says Blyth, “exactly what constitutes a free zone but at the very least there will be a customs free area where the flow of material and equipment can take

place with as little paperwork as possible and without the payment of duty or VAT. This will then become the hub for work related to oil & gas exploration and production.” Prior to the selection and the study that has just been completed there, the debate was whether or not a hub on the east side of South Africa might have been better, bearing in mind that the focus of attention was on East Africa. However, Blyth is sure that Saldanha Bay is the best option. “It’s a natural deep water harbour,” he says,

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South African Oil & Gas Alliance

Established road, rail, sea and air routes make South Africa makes an ideal logistics base

“which lends itself to a floating dry dock and has plenty of room for development. It also has the advantage of being within easy access to Cape Town and all the city has to offer.” And, of course, if the exploration taking place on the west coast and development of Namibia’s Kudu gas field comes to fruition, then Saldanha Bay will be ideally situated. In summary, then, SAOGA is being both realistically practical and optimistic about South Africa’s role in the development of southern African oil & gas projects. The security and stability there must come as a welcome alternative to the chaos in Nigeria. The established road, rail, sea and air routes that already exist in South Africa makes it the ideal logistics base.

It has experienced engineers and factories of every size and level of sophistication, offering a broad base of suppliers. At government level, there are already good relationships with neighbouring countries and although the wheels of government might be just as slow as in other African nations, within South Africa there are plenty of advisers with experience of getting things done in the most productive way. For newcomers to South Africa, all of this information and more is available via the SAOGA directory. For more information about South African Oil & Gas Alliance visit: www.saoga.org.za

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Industry focus: SA oil & GAs

Hesper Engineering

A reputation

earned With more than 40 years of ship repair experience, this SAOGA member is looking to expand into the oil and gas sector. General manager James Wrensch explains written by: Will Daynes research by: James Boyle

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Hesper Engineering Rigging of repaired thruster onto barge


natural bay overlooked by Cape Town and stretching south to the Cape of Good Hope, Table Bay is home to the iconic Table Mountain. For centuries it has been recognised as a haven for ships and today provides the perfect location for the operations of Hesper Engineering. With more than 40 years of ship repair experience, the company is well placed to service its customers’ repair and modification needs. “What began life as a small engineering business that served the local fishing industry has since grown into a leading regional competitor offering a variety of core functions,” explains general manager, James Wrensch. “This enables Hesper Engineering to take on and deliver turnkey projects in all aspects of the marine engineering and fabrication industry.” Able to carry out work in Walvis Bay, Lüderitz, Saldanha Bay, Simonstown and Port Elizabeth, with mobile teams available to travel to any part of southern and West Africa to carry out specialised repairs, Hesper Engineering’s highly trained technical staff includes ex-marine and naval engineering officers and artisans. Each possessing outstanding shipping and general engineering expertise, key members of the company’s staff are also fluent in Spanish, Greek, Portuguese and German. Hesper Engineering has the ability to approach a project from multiple angles, and as part of the Novatech Group it can call on the support of other group members to subcontract as required. “While having

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the ability to cover the entire scope of a project is an invaluable quality,” Wrensch continues, “arguably the greatest strength of the company is its hands-on approach. From the management down, every employee of the company plays an active role in ensuring that the job at hand is done quickly and efficiently.” Hesper Engineering has therefore earned a reputation for service in the ship repair industry. “If a customer needs something done quickly and done well,” Wrensch says, “they know there is no better company to turn to than Hesper Engineering.” In 2009, the company took a first-ofits-kind project when it was tasked with constructing and fitting a new, 30 tonne rudder to the tanker M.T Biz to replace one lost in poor weather west of the Cape of Storms. The three-month project, carried out to the highest possible specifications, added greatly to the company’s experience. Other large-scale projects include the lengthening and converting of the M.V North Star to a mono hull design and the building of additional fuel tanks on behalf of Carrier Marine in 2009, and a multi-faceted project involving the Transnet National Port Authority’s Enseleni Harbour Tug in 2010. This latter job involved the stripping

and removal of the starboard Voith rotor from the vessel, repairing and modifying the sealing arrangement and the standard overhaul of the complete Voith unit. The company was able to complete work on the tug in just 26 days. More recently, the company has

“While having the ability to cover the entire scope of a project is an invaluable quality, the greatest strength of the company is its hands-on approach” 58 | BE emea

Hesper Engineering

Rigging new rudder into position while vessel afloat

completed work on an underwater work when dry accommodation barge docking in Cape Town. belonging to Sea Trucks As approved design Group. Central to this and installation agents for contract was the overhaul Epocast 36 resin chocking Years of ship repair of two 30 tonne retractable compound, the company is experience thrusters. As these were able to carry out main engine approximately 12 metres and machinery re-chocking each in length, the scale of in-house, preventing delays the comprehensive refurbishment project to vessels trying to source foreign expertise. presented an excellent opportunity for the Hesper is also an approved Simplex Service engineers to add to their experience. Station for the supply, installation and Hesper Engineering is also servicing bonding of Simplex Stern Tube Seals. the offshore diamond mining sector, Like some 170 other private sector specifically DeBeers Marine in all its companies, Hesper Engineering is a


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Refitting of Voith blades into new rotor

Re-chocking of the M

“If a customer needs something done quickly and done well they know there is no better company to turn to than Hesper Engineering” member of the South Africa Oil and Gas Alliance (SAOGA). As it continues to grow, it plans to become increasingly involved with the Alliance, sharing the knowledge and experience it has gained over the years with others. “It is probably fair to say that the company has yet to take full advantage of the benefits that membership

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of SAOGA provides,” says Wrensch. “This will change as Hesper Engineering evolves further and gears itself more towards the oil and gas sector.” Committed to investing in its people, one of the benefits of SAOGA membership the company will no doubt look to capitalise on is the number of training

Hesper Engineering

Magsenger two man main engine

programmes available. These will help develop the skills required to service the needs of oil and gas customers. At the same time as it develops its employees’ capabilities, the company plans to expand its workshop facilities to cater for the contracts it will attract from the oil and gas sector, specifically those vessels that boast large propulsion units. “At the heart of the company’s expansion plans,” Wrensch explains, “is the building of a 400 square metre warehouse that will house a 30 tonne crane with a 14 metre lift underneath. This major project is expected to be carried out and completed during 2013.” As plans for this expansion steadily gain

Refitting of Voith rotor into Enseleni Habour tug

steam, the future looks bright for Hesper Engineering. “Oil and gas is definitely the sector to target, especially in growth areas like West Africa,” Wrensch concludes. “Clearly, the way we operate has worked out well so far and from that point of view there is not much that needs improving. The local reputation we have gained over the years is nothing short of excellent and we fully intend to maintain this as we move forward.” For more information about Hesper Engineering visit: www.hesper.co.za

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Industry focus: SA oil & GAs

The know

Wh cen d

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Sturrock Shipping

w-how people

hile the excitement and glamour of oil and gas production ntres around the wells themselves, nothing would ever get done without the support of experienced service providers written by: Alan Swaby research by: James Boyle

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lsewhere in this publication there is an account of what the South African Oil and Gas Association (SAOGA) is doing to coordinate and encourage South African based businesses to be part of the overall development of Africa’s oil and gas industries. Here is a perfect example of what can be achieved by a business that has no interest or involvement with engineering or manufacturing and yet is still making money from oil and gas. Sturrock Shipping has been around for almost half a century. It’s not a shipping company as the name might suggest but rather a ship’s agency plus forwarding and logistics company. It’s the type of business you go to when you want someone to take responsibility for the full supply-chain of services related to sea transportation or the import and export of goods into and out of Africa. It does have links with the actual shipping process – its BEE ( black economic empowerment) partner is Calulo who is involved in ship chartering around the African coast as well as bunker brokering, but Sturrock is essentially a facilitator – it gets things done on behalf of others. “We specialise in the oil tanker sector,” says ships agency director Clive James. “As such, there are very few of the larger names in oil that we don’t service with freight forwarding, landside logistics and a whole gamut of vessel and cargo requirements.” For many years, during the apartheid era, Sturrock’s expansion plans were hamstrung

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Sturrock Shipping

Our dedicated support team understands our clients’ requirements and deadlines, providing prompt responses and expert solutions

We know it’s not enough simply to have the right information. Our specialist knowledge and experience give us the insight to get to the heart of our clients’ business

Sturrock Shipping by poor relations between South Africa and the rest of the continent. However, when the ANC government came to power and sanctions fell away, Sturrock had the green light to start its expansion plans. The first office was opened in Mombasa with Dar es Salaam following later, both bringing Sturrock into contact with a whole new range of clients, particularly in oil related businesses. “We decided to start on the east coast,” says James, “as An empowered team committed to providing responsible, there we shared the English cost-effective and efficient service that will ensure language – something complete customer satisfaction which would make life just a little easier while adapting to a new set of considerable experience in English speaking conditions and business habits.” zones that they ventured south a little and It’s an easy trap for Europeans and opened two offices in Mozambique. “We’re Americans to fall into thinking that Africa neighbouring countries,” says James, “but is all the same. “The common features,” the fact that business is conducted in admits James, “are the high incidence of Portuguese creates a considerable gulf.” bureaucracy and the generally poor state Now though, the network is extensive: of the infrastructure, but in each case, the eight offices throughout South Africa, three fine print is different.” in Mozambique, three in Tanzania, five in It wasn’t until they had gathered Madagascar, plus offices in Angola, Kenya,

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Ghana and Sudan. “We try to understand local conditions and not be Eurocentric,” says James. “Instead, we try to find good partners to deal with who share our ideals of good service through reliability and then tailor a modus operandi around the specific conditions in each country.” Having someone reliable is exactly what clients want. Many of the above branches have been created at the behest of customers

tired of sloppy service from agents working for their own best interests and not the client’s. “Everything about the way Africa operates is improving,” says James, “the roads, phone system, broadband speeds and even bureaucracy. It means the barriers to entry are coming down and competition is increasing. But it’s not always improving fast enough for some of our clients based in Asia, Europe or the US. They have little tolerance

“The first thing that takes new clients by surprise is that we show them it is possible to have an answer within minutes”

It’s not only price or quality that differentiate us, but customer service that always exceeds our clients’ expectations

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Sturrock Shipping

Strong relationships demand trust, which we build through consistency and integrity in all our business practices

for a lack of punctuality, and our broader experience promises that aren’t kept when combined becomes a and poor quality work. potent force.” While we adhere to our own Sturrock then works on the basis that the most ever improving quality Sturrock became standard, we strive to corrosive element for good ISO certified remain ahead of the pack.” client relationships is poor The services provided by communication. “The first all ship’s agents are similar, thing that takes new clients if not identical, so Sturrock places the by surprise is that we show them it is emphasis not on what is done but rather possible to have an answer within minutes how it is done. “It’s all about relationships,” rather than the hours or days that might says James. “First we need to work closely previously have been their experience.” with the appropriate authorities to make Another point of difference Sturrock sure we understand what they want. Here claims in its favour is the extent of it helps for us to partner with strong local its health, safety, environmental and firms which have demonstrated a high quality management systems. SHEQ has level of capability. Their inside knowledge traditionally not featured too prominently


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We develop our vision in consultation with an empowered team, bringing their special talents and resources to bear on the challenge of creating superior customer value and sustaining a competitive advantage

Sturrock Shipping on the radar of many African countries, but as a result of Sturrock’s long track record dealing with the oil majors it has become a serious and necessary focus of its business today. “All the most important oil companies,” says James, “are fully aware of their social, health and environmental responsibilities and want their agents to be equally prepared and like-minded in their approach to these non-negotiable aspects of the business. Of course, every effort is made to avoid environmental damage but should something untoward occur, clients need to know that we are ready to deal with any situation. Sturrock has been ISO certified since 1996 and has experienced teams that it can deploy to assist with incidents at short notice. The amount of investment taking place in African oil and gas production is making the region an attractive target for some of the largest international agency names. But Sturrock remains confident that its focus on an African presence has numerous benefits for potential new clients. “We can demonstrate,” says James, “that the service we offer is equal to anywhere in the industrialised world but with a true understanding of what it is like to do business in Africa. And for multinational clients, we promise a consistent way of working regardless of the location.” For more information about Sturrock Shipping visit: www.sturrockshipping.com

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Industry focus: SA oil & GAs

Pass the test

In the midst of South A a centre of oil and gas of One Eighty Engine materials testing cen specialised written by: research by:

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One Eighty Engineering Solutions

sing test

Africa’s emergence as s activity, the opening eering Solutions’ new ntre will provide local d services Will Daynes James Boyle

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he most developed economy in sub-Saharan Africa, South Africa’s long history of excellence in sectors such as mining, resource extraction and maritime services is well documented. The industry, however, that has been undergoing rapid development in more recent years is oil and gas, in particular the upstream market. Today the country plays host to a significant supplier base, a capacity that is complemented further by the presence of a number of the world’s leading service companies. “It was ten years ago, in 2002, that I started up the company,” explains Janet Cotton, founder and director, “after recognising the industry’s need for metallurgical consultant work and materials testing capabilities.” In the decade since its formation the company has gone on to develop a client base of over 300 organisations and businesses. Delivering creative, high value engineering solutions in the form of key information, One Eighty has come to be recognised as a leader in materials and metallurgical expertise. Today, One Eighty is undergoing something of a transition. Whereas in the past it would subcontract the testing work that was required as part of a consultation, a substantial investment and support from Allseas, a Swiss offshore contractor currently executing a pipe lay project for PetroSA, has provided it with the capital needed to construct a materials testing centre that will allow it to carry this out in-house. Expected to be up and running by the end of the year, the testing centre, with its

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One Eighty Engineering Solutions

Founder and director, Janet Cotton

state-of-the-art equipment will place One Eighty in the unique position of having capabilities that are otherwise unavailable in Cape Town. “While some companies do offer some materials testing,” research, development and design engineer, Suzanne Higgins says, “only we will have the ability to carry out a full study for a customer with all the equipment required to do so.” It is companies within the oil and gas sector that are showing an increasing interest in One Eighty’s materials testing capabilities, particularly as it relates to weld procedure qualifications. Before commencing work on a ship or a rig an operator has to ensure that they first qualify the weld procedure. This is done through a

series of impact and hardness tests carried out to the necessary standards. “With oil and gas activity expanding across the region,” Cotton continues, “this service is becoming more in demand and we have identified it as one of our biggest growth markets going forward.” Upon the opening of its materials testing facility, One Eighty will possess one of the very few laboratories in South Africa with the ability to offer weld procedure and performance qualification test. Any oil and gas related construction involving welds has to undergo these procedures and performance related tests before work can be commenced. The procedure tests relate to the type of welding and the performance

With experts in material science, mechanical engineering and chemistry, One Eighty works to bring engineering an

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One Eighty Engineering Solutions

“One Eighty has come to be recognised as a leader in materials and metallurgical expertise” tests refer to the welder or weld operator. At its new premises, the company will be able to conduct tensile, bend and impact tests, before providing its customers with a detailed report. These tests will not be limited to the oil and gas sector. Customers from various other industries will be able to make use of them. In addition to materials testing, One

nd science together

Eighty provides comprehensive failure investigation and material selection services. “What also makes us unique,” states quality assurance manager, Petra Gress, “is that, as a company, One Eighty actively works to bring engineering and science together. By having experts in fields such as material science, mechanical engineering and chemistry under one roof we are able to approach each project from multiple angles.” A recent example of the company’s materials testing capabilities being put to use involved the hull of a vessel failing whilst at sea and the subsequent tensile and burn testing of the hull material by One Eighty to determine the quality of the lay-up of the various components of the vessel. In addition to these tests a microstructural examination was conducted and it was this that identified that the crack that led to the failure of the vessel developed in the centre part of the laminate. It was further determined that this part of the laminate was indeed more prone to fracture than the outer layers as the volume fraction of fibres in this region is lower. There are numerous other case studies that highlight One Eighty’s expertise in the fields of failure investigation and material selection. One of its undertakings in the

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One Eighty identifies the cause of equipment failure

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former saw it responding to a customer’s concerns when two electric motors used for cutting hot glass experienced catastrophic failure. Estimated to have been in constant operation for three days prior to failure, in both cases the issue appeared to stem from a fracture adjacent to the bearing. Evidence collected by One Eighty identified that the drive shaft failed as a result of fatigue cracking, due to rotating bending. This implies that the applied stress had exceeded the fatigue strength of the material at the site of fracture, with the loose fit between the shaft and the fan being the most likely cause for failure. Stress analysis calculations confirmed that the fan wobble was sufficient to cause fatigue fracture within the reported operating hours. From a materials selection point of view, the analysis the company carried out on a hinge pin on a diving bell door also stands out. In this case the customer in question reported the pin showing severe galling over time, resulting in difficulty opening and closing the door. What One Eighty was able to recommend was that to reduce this galling, the surface finish, lubricant selection and material selection must be optimised. It also highlighted that using a lubricant containing a solid element would produce the best results, creating a barrier between surfaces and preventing the effects of cold welding. It was through the company’s membership status within The South African Oil and Gas Alliance (SAOGA) that it was able to ascertain whether there was in fact a need for a materials testing facility in the

One Eighty Engineering Solutions

Metallurgical services remain highly specialised and are not widely available in South Africa

Western Cape of the country. “The feedback we received from fellow members,” Cotton says, “was overwhelmingly positive, with the consensus being that, in order for the region to provide world-class services to large oil and gas players, a local test centre is essential.” Despite being a fundamental aspect of manufacturing, metallurgical services remain highly specialised and as such are not widely available in South Africa. What

One Eighty is able to do as a member of SAOGA is use its expertise and knowledge to educate people as to the importance of these services. The SAOGA can in turn distribute this to its members. “As oil and gas activities increase in South Africa,” Cotton says, “it becomes all the more important to have the right degree of materials testing knowledge and experience available locally to service this growth.” Without access to local facilities,

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The materials testing facility will create many new opportunities

One Eighty Engineering Solutions companies would otherwise be forced to continue sending work back to Europe. One Eighty’s facility will not only help eliminate the logistical and economic burden that comes from this, it will also provide the opportunity for customers to get a better understanding of the process and its results through closer, more direct interaction. Over the course of the next two years, the company is committed to its aim of taking its materials testing facility from zero percent capacity to at least 75 percent capacity and beyond. “With the opening of the new centre,” Higgins enthuses, “comes a great number of new opportunities. We know there is lots of work out there and this gives us all a great deal of excitement for what the future holds.” In the meantime, not only does One Eighty intend to expand its consultancy business internationally, its founder and director has her own personal goal that she wants to see come to fruition and that is for the company to branch out into product development. “This is something I am hoping to see became a much stronger theme for the business over the next five years,” Cotton concludes. “Whether it involves developing our own range of products or specific, bespoke items for a customer, I envision One Eighty’s business being balanced between consulting, materials testing and product development.” For more information about One Eighty Engineering Solutions visit: www.one-eighty-degrees.com

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Industry focus: SA oil & GAs

An ambitious target South Africa-based Filcon Filters has set an ambitious target of 25 percent annual growth over the next three years. Directors Vernon Clarke, Tony Henfrey and George Canning talk about running a knowledge-based business written by: Gay Sutton research by: Marcus Lewis

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Filcon Filters

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Trevor giving a piece of pipe the evil eye

Filcon Filters


anufacturing, water and waste water, oil and gas, food and beverage, petro-chemical, paint—no matter what business you are in, continuity is essential. Downtime and quality issues cost money. So it’s small wonder that many companies prefer to stick with the brands and suppliers they know and trust. One company supplying top quality proprietary products, but also encouraging customers to break the cycle of inhibition when a custombuilt product would be more effective, is Filcon Filters. Launched in 2000 by owners Tony Henfrey and Vernon Clarke, Filcon initially began trading as an importer and supplier of proprietary filtration products with a distribution licence for Hayward Filtration, now part of Eaton Filtration. From its base in Cape Town, the company quickly expanded and diversified, and today stocks a wide variety of products that include self-cleaning, back washing and centrifugal filters, market, basket and flushing strainers, filter cartridges and bags as well as filter media in the form of materials such as activated carbon. “We are still diversifying,” said sales director Vernon Clarke. “We’re always looking for new types of equipment and technology, and if a new product fits with us we will investigate it.” Vernon drives sales and Tony positions the Filcon brand through press releases and search engine optimisation. Filcon’s aim is to become South Africa’s leading filtration specialist. Over the past 12 years considerable progress has been made towards that goal. “Today, we provide not

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25% Annual growth target from 2012 to 2015

PS250 Auto with brush

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just products,” explained financial director Tony Henfrey, “but we also answer any questions our customers have on filtration, and we will even design filtration systems to solve specific application problems.” Through a combination of in-house technical expertise, reliability and integrity, the company has built a solid reputation for excellence. “Service levels are particularly important to us,” Clarke continued. “If we are able to service the customer to the level that meets with their satisfaction, price is not always the key. People will purchase from us because we have the stock levels, and we deliver on time.” As part of its strategy for growth, the company opened a second office in Johannesburg two years ago, close to South Africa’s industrial heartland. One of the key roles of the new technical centre is to diversify into a new gap in the market. “With the rand weakening against most currencies and imports therefore becoming far more expensive,” Henfrey said, “we realised that manufacturing our own range of products would give us an edge.” The manufacturing arm of Filcon is managed and run by design engineering director George Canning who brings some 30 years’ experience to the business.

Filcon Filters

200GTSSHP in duplex format

The economics of manufacturing custom products in South Africa are, he believes, very persuasive. “Because of the size of the market here and the sheer range of filters that are available on the global market, it’s impractical to hold stocks of them all. So if a customer requires a filter that is in any way non-standard, the freight costs of importing a one-off product are simply prohibitive,” he said. “In the past, plant engineers have had to modify their plant in order to accommodate a filter from the standard range. The service we’re offering means they don’t have to do

that. We will design non-standard filters from scratch to their specification. We then outsource the manufacture to one of three trusted fabricators here in Johannesburg.” With Filcon’s reputation for technical excellence, the service has proved very popular. It saves on freight costs, reduces the downtime, cost and risk associated with adapting production equipment. All Filcon filters are manufactured to ISO 9001:2008 quality standards, and the company retains control of the entire process by providing not only the detailed technical designs but also the raw materials and components.

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Since launching the new service, Canning has continuously been refining the design and manufacturing process to increase efficiency and reduce lead time, therefore making custom manufacture even more attractive. For example, where there are components and materials common to several products, the company always holds significant quantities in stock. Custom manufacturing has been very successful, and the unit has made a name for itself with some of its products. Among the more significant is the Dirt Gobbla, a centrifugal filter that is currently unique in South Africa. “We’re also known for our centrifugal strainer, our automatic purging strainer and back washing strainer,” Canning said. “And we’ve developed a popular line of locally manufactured in-line basket strainers.” As Filcon is a knowledge-based enterprise, ensuring business continuity has become a high priority. “This is something we’re very conscious of, and have been planning for,” Clarke said. There are currently two young graduates employed under Canning at the Johannesburg office, and one under Clarke at Cape Town. All three are undergoing a mixture of formal training and continuous in-house coaching where they are learning

skills and gaining experience of the industry, absorbing knowledge almost through a process of osmosis. “One is a young African lady who has a BSc in geology with a chemistry background which should be an aid in water treatment. It’s her first job out of graduation,” Henfrey explained. “She is showing tremendous potential and is probably one of the first black women to

“At this stage, we see mining as a real growth area, and we’re also looking at the oil and gas industry, particularly in Namibia, Mozambique and Tanzania” 88 | BE emea

Filcon Filters

300GTSSLP Strainers

700mm Strainer 3

venture into the filtration industry, so we’re nurturing her.” Alongside this, the company has been working to improve its BEE (broad-based black economic empowerment) score, and has recently raised this to level 2, an achievement that delivers added benefits for the customer. With these achievements under its belt, Filcon has set a challenging target for growth. “We have set ourselves a target of increasing sales by 25 percent per annum from 2012 through to 2015, and we are on target to achieve that this year,” Henfrey continued. “Our next priority is to open an office in Durban as we believe there is a big market in South Africa that we have not yet tapped. But we are also looking into Africa as a whole.” The company has already begun

to make inroads into the wider African market through third party suppliers. “At this stage, we see mining as a real growth area, and we’re also looking at the oil and gas industry, particularly in Namibia, Mozambique and Tanzania. And of course with South Africa being the 20th most water deprived country in the world there is tremendous potential for recycling and reusing water.” With so many new opportunities in a rapidly expanding industry base, the target seems well within range. For more information about Filcon Filters visit: www.filconfilters.co.za

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Express i

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DHL Express Pakistan

improvement Managing director Sarfaraz Siddiqui explains how, in just four and a half years, DHL Express Pakistan has become the best company to work for in Pakistan

written by: Gay Sutton research by: Jon Bradley

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State of the art hand held scanners

DHL Express Pakistan


hen the globa l international express delivery specialist DHL Express first opened offices in Pakistan some 30 years ago, it did so in a joint venture partnership with local partners. In 2008, however, when the opportunity arose to acquire full ownership, DHL quickly took full control and drafted in Sarfaraz Siddiqui to transform the business into a world class operation. A Pakistani national, Sarfaraz has extensive international management experience spanning over 24 years with DHL, including responsibility for pricing and yield management and commercial planning for some 153 countries. He has also been head of business intelligence and productivity development for 89 countries in the EMEA region. Today, DHL Express has earned a dominant market share of the international express delivery market in Pakistan, and leads the market in terms of operational best practices, customer service, value for money and staff engagement. The Pakistan network comprises three international gateways at Karachi, Lahore and Islamabad which link directly into the DHL global network. The Karachi airside facility is one of the most modern in the global network. Employing some 280 staff, it also provides the service centre facilities for the south of the country. In the north of the country around 250 people are based at service centres in Lahore, Islamabad, Faisalabad and Sialkot. All five service centres are then supported by an extensive network of some 55 service

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280 Employees at Karachi airside facility

Direct sort and loading

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points spread across 22 cities countrywide, and supplied by a modern fleet of 150 pickup and delivery and sales vehicles, making DHL Express Pakistan the leading air express service provider in the country. “When I arrived here in 2008 from Bahrain, DHL Express Pakistan had several untapped opportunities for development and growth,” Siddiqui explained. “There was scope for productivity enhancing structural changes which could lead to improved employee motivation and positive business results. The right areas for investment had to be identified to achieve the targeted outcome.” It was clear he had a big task ahead of him. His first move was to bring in a new senior management team to help rebuild the business. Then he turned his attention to what is often the most difficult element of business improvement. “We worked on building employee engagement,” he explained, “and opened up as many channels as possible to create honest t wo way communication bet ween management and staff.” He began the process by launching a series of town hall meetings, personally visiting every location around the country to present an overview of the company and

DHL Express Pakistan

Managing director, Sarfaraz Siddiqui

to answer the questions or concerns of the staff. “The first town hall meeting went on for seven hours as people had so many comments and questions,” he remembered. “We noted down everything and ended up with a list of over 130 action items from that one marathon meeting.” Through extensive communication and employee engagement, he swiftly addressed issues in a timely basis and ensured he returned to each location after every three months to repeat the exercise. This contributed towards promoting trust and commitment amongst employees. “It

was very successful indeed. And I have continued the town hall meetings regularly every three months, addressed each and every highlighted point without exception,” he said. “As a result, the staff began to trust management and it’s been a journey towards excellence. Now, people know that I live by whatever I say.” One of the first big staff issues he addressed was that people were working extremely long hours and yet performance was not optimal. Siddiqui took a firm and fair stance. He announced that all staff were to arrive at 9.00am and leave at 5:30pm, and

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he surely led by example to deter anyone from trying to impress him by working longer hours. “I then told them that if they were still working late in the evenings consistently, and yet not achieving the goals then it would be necessary to review the scope and the processes to identify areas of improvement.� It was a promise he kept. With the help of a thorough skills audit, roles were reviewed and employees were placed in the right numbers in positions that were appropriate for their skills. Alongside this, a training programme was rolled out to support staff in their work and to introduce the most efficient working practices and processes.

DHL Express Pakistan

Environmentally friendly DHL delivery vehicles

“With an optimal staff strength,” Siddiqui said, “we benchmarked our salary scales within the industry and implemented a range of performance-based bonuses and incentives. This was a great motivator and employees welcomed an achievement based structure where rewards were based on good performance.”

The turnaround in staff motivation has been reflected in the annual DHL employee opinion survey. In 2008, employee engagement rating was 68 percent. In 2009 it rose to 70 percent and by last year it had shot up to 98 percent, a position Siddiqui expects to maintain when this year’s figures are announced.

“We noted down everything and ended up with a list of over 130 action items from that one marathon meeting” BE emea | 97

Preparing documents for export

“We won the DHL Award as the Best Country of the Year in Asia Pacific, and the most improved country of the year in Asia Pacific” While staff engagement was one of Siddiqui’s highest priorities, he has addressed performance in every area of the business, raising it to world class standards. In 2008 he inherited an organisation with potential for growth, and he set about to build an enviable, market-leading business in

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Pakistan. The largest single investment has been the construction of a new US$5 million state-of-the-art airside facility at Karachi. Covering some 7750 square yards, the site also houses the national headquarters, call centre and service centre. Substantial amounts are invested in

DHL Express Pakistan

Unloading a parcel for reweigh

Daily courier debrief

the new telephony system and hand held imports originating from Pakistan. scanners to support the use of the latest Many organisational processes have also communications and IT systems across the been introduced to improve the level of business, while the vehicle fleet has been service. For example, the company runs a replaced. Buildings and offices have all been centralised call centre at the new facility given a facelift, and equipment updated to in Karachi. “But Karachi can be a volatile DHL’s standards. This includes a further city in terms of security, so as a contingency investment in security, we have trained a number of staff in our northern installing the latest state of the art x-ray machines and offices to work as customer explosive trace detectors service agents and advisers to scan all the shipments. in time of need,” Siddiqui These are the machines said. “Now, if Karachi is shut Current employee approved by EU and US for any reason then backup engagement rating regulators for the scan of call centres automatically


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DHL Airside Facility in Karachi

DHL Express Pakistan

$5 million Invested in Karachi airside facility start to operate in the north. As a result we haven’t had a single service failure since the end of 2009.” Siddiqui has also applied his extensive experience in pricing to provide value for money to customers, coupled with highest levels of service. “This has strengthened DHL’s brand image in the local market leading to strong customer satisfaction, brand loyalty, and ultimately a dominant market share.” During 2012, the achievements of the past four and a half years have received wide recognition. Perhaps the most prestigious award has been receiving the Express Tribune’s Best Place to Work in Pakistan, run by Engage Consulting and based on a survey of the staff of 200 of the country’s best companies. “But the best for us,” Siddiqui said, “was when we won the DHL Award as the Best Country of the Year in Asia Pacific, and the most improved country of the year in Asia Pacific.” It is fitting recognition of the significant changes that have taken place, and the hard work and support of a dedicated staff. For more information about DHL Express Pakistan visit: www.dhl.com.pk

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Overcoming adversity with diversity

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Flinders Ports

Andrew Pellizarri, general manager of Flinders Logistics and Peter Cheers, general manager of Flinders Adelaide Container Terminal, discuss how Flinders Ports has adapted to evolve

written by: Will Daynes research by: James Boyle

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Flinders Ports


Flinders logistics loading copper concentrates using the rotating tippler system to discharge concentrates into bulk vessels

any companies around the world have felt the effects of the global financial crisis since it first began to take hold in 2008. Harsh lessons have been learned in the time since, yet some businesses have managed to weather the economic storm and, in some cases, come through stronger than before. Often what we find is that one characteristic these businesses share is diversity. “By moving away from being purely a port owner,” explains Andrew Pellizzari, general manager of Flinders Logistics, “we have diversified as a business and this has sheltered us in some ways from the financial crisis and allowed us to go from strength to strength.” The diversification he mentions relates to the steps taken by Flinders Ports, over the last 18 months, to establish a logistics business, take full ownership of the Adelaide Container Terminal and expand its reach across Southern Australia. As the mining sector within South Australia has grown, the company has been increasingly looking to develop its ports to offer a competitive supply chain solution to the industry. It is South Australia’s growing importance within the commodities and raw materials markets that first spawned the concept of Flinders Logistics. What was originally positioned as a bolt-on to the main business has rapidly evolved into its own entity, providing infrastructure and specialised services in niche markets. Despite its short history, Flinders Logistics has already made its presence felt, introducing its rotating tippler solution to

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Flinders Ports the marketplace. “What Worksafe SA we have done,” Pellizarri Worksafe SA provides a range of drug and alcohol continues, “is develop a screening and education services and has been appointed technique that is changing by Flinders Ports Holdings to conduct testing at all sites the way concentrates are including Flinders Adelaide Container Terminal and other handled and that is now Port Adelaide and regional sites. being embraced across Worksafe SA offers assistance in the development of policy and procedures; alcohol and drug screening by breath, Australia, and soon the urine or saliva analysis; consultation with both management world over.” In recent and employees in regard to alcohol and drug related matters months, CEOs and directors and conducts drug and alcohol awareness sessions. from companies near and Employers who have used Worksafe services report many far have visited Adelaide benefits including decreases in absenteeism, accidents, to examine the company’s downtime, turnover and theft as well as increases in solutions and they all agree productivity and overall improved morale. www.worksafesa.com.au that Flinders Logistics is the market leader when it comes to this technology. Integral to the technology is the company’s DF misting system. Designed to eliminate air contamination from the dust generated from the movement of container loads, the system has been a revelation for both Flinders Logistics and the sector. “Naturally,” Pellizzari states, “different products and loads create different types of dust particle. Additionally we have to adjust the misting system to varying degrees of pressure, wind and humidity in order to supress the dust. The DF misting system is flexible enough to do all of that.” In July 2012, Flinders Ports confirmed that it had acquired 100 percent ownership of the Adelaide Container Terminal following its buyout from previous co-owner DP World. The deal valued the business, which handles approximately 300,000 containers a year, at more than $223 million. With the success of the terminal being integrally linked to The rotating tippler system

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Flinders Ports the success of Flinders Ports not only to the company’s as a whole, the company has employees, but also its clients taken the view that major that Flinders Ports is ready investment is needed to take to invest to provide a more the business further. efficient, effective service. Presently the company is “When we went into the assessing the market for terminal,” Peter Cheers, general manager of additional quay cranes. Flinders Adelaide Container The port side of the company is constantly Terminal explains, “we knew we had to spend capital looking at ways in which it in order to buy equipment Operations at the Flinders can grow, be it through the such as additional cranes, Adelaide Container Terminal expansion of its existing and implement a planned assets or through the maintenance programme. These are the acquisition of mature or new opportunities. sort of things that, once in place, allow you One on-going development for Flinders Ports to more effectively manage your resources.” involves the Port of Bonython, 20 kilometres Such actions also send out a strong message east-northeast of Whyalla, South Australia.

INTERMODAL SOLUTIONS GROUP (ISG) Oz Minerals supplied with 1,400 specialised copper concentrate containers Oz Minerals went to tender in 2011 for the supply of 1,000 specialised copper concentrate containers for its Prominent Hill operation, choosing containers specially designed by the Intermodal Solutions Group (ISG) engineering team. The containers were the first in the global market to be certified to BK2 and ADG7 dangerous goods code. The shipping containers are designed for minimum product hang up which includes curved gussets in all corners, and tapered side and end walls. The containers are designed to be suitable with all tipplers in the global market, and include a pioneering lid which is automatically

locked and unlocked by the tipplers. After the successful on time delivery of the first 1,000 copper concentrate containers a further 400 more were ordered. “The new containers allow OZ Minerals to export its copper concentrate to a high environmental standard,” said OZ Minerals Project Manager Andrew Fitzgerald. OZ Minerals exported its first shipment of copper concentrate from Prominent Hill using the specialised containers in January this year from Flinders Port in Adelaide.” Intermodal Solutions Group (ISG) is the largest bulk container design company in Australia. Please visit www.intermodalsolutionsgroup.com.au or phone Garry Pinder on +61 400 035 548

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Flinders Ports A large greenfield site, it is SA Lift and Loader intended to become a deep SA Lift and Loader Pty Ltd supplies and maintains Flinders water port tailored for the Ports’ materials handling-equipment. This includes two sixtybulk commodities sector. As five tonne Omega reach stackers, a Fantuzzi reach stacker, the leader of the consortium and five Omega empty container handlers. that won the tender for this The ten-year relationship between the two companies has development, Flinders Ports resulted in an efficient method to move and store shipping containers from the ship to the customer. is currently undertaking an The guys at SA Lift and Loader are dedicated and make sure environmental impact study the equipment is available and ready when the drivers need on the project. The Port of it to move containers. Above all, managing director David Bonython is expected to Mudge and his team are good people to do business with. take around three years to www.saliftandloader.co.au build, at a cost of between $600 and $750 million. The successful growth of Flinders Ports and its various businesses is clear to see, yet evidently there is much still to come. “From a logistics perspective,” Pellizzari says, “our natural progression involves replicating what we have achieved locally on a grander scale. Through word-ofmouth alone, we are now working on several interstate projects and this will be the way forward. While we want to avoid overstretching or overcapitalising the business, what we are able to do is pick Operations at the Flinders Adelaide strategic points in the region where we ContainerTerminal can set ourselves up and invest in capital with plant, MooreAir equipment and operations.” MooreAir has been an airconditioning and refrigeration provider to the shipping industry for the past 18 years. When it comes to The company specialises in design, installation and its Adelaide Container maintenance for a broad range of industries including rail, Terminal, the company shipping, earthmoving, public transport and airport ground has a clear mission in support. MooreAir has a strong commitment to providing its front of it and that involves customers with service excellence, ensuring a comfortable tackling the issue that, at working environment at all times. current rates, the terminal www.mooreair.com.au will have reached its full

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“We have developed a technique that is changing the way concentrates are handled and that is now being embraced across Australia, and soon the world over” capacity within 12 to 18 months. “Unlike other terminal operators,” Cheers says, “we are in a position where we have significant land holdings adjacent to and

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around the terminal itself.” Ownership of this land will allow any future redesign of the terminal to be undertaken in the most effective way. Additionally, it provides

Flinders Ports

Flinders Adelaide Container Terminal has benefited from recent capital investment

Flinders Ports with the opportunity to establish and run empty container depots and other businesses that are ancillary to its main container operations. “In addition to having good management and a professional, dedicated workforce,” Cheers concludes, “one of the core strengths of Flinders Ports is that it has always retained a very strong ethical position. The transparency we have with our employees and clients allows them to

see the good work that we are doing and having the sort of demonstrated business record that we have, particularly in the maritime and stevedoring industry, is a very strong selling point for the growth of our business in the future.” For more information about Flinders Ports visit: www.flindersports.com.au

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written by: will daynes research by: Jeff Abbot

How diversification has helped Strategic Marine become globally recognised as a builder of first-class vessels

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Strategic Marine

s tt

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Strategic Marine boasts an evergrowing reputation for producing quality, high performance vessels

Strategic Marine


ustralia’s maritime history is closely linked to the global spread of mankind across the oceans. From the first Pacific island mariners who engineered the earliest vessels capable of travelling thousands of kilometres, up to as recently as the 1950s, Australia’s history of trade, colonisation and settlement was dependent upon its maritime activities. The significance of the country’s maritime past can still be seen today in the form of its new generation of shipbuilders. A dynamic, Western Australian shipbuilding and engineering company, Strategic Marine boasts an ever-growing reputation for producing quality, high performance vessels that service markets all around the globe. “Known for never compromising on quality under any circumstance,” explains Ron F. Anderson, executive director, “Strategic Marine is recognised globally for being the very best at what it does.” With its origins in Geraldton Boat Builders, one of Australia’s leading aluminium shipbuilders, Strategic Marine was incorporated in 2001. In the time since, it has produced more than 400 vessels, focusing on offshore crew boats, support vessels and high-speed patrol boats. In recent years, the company’s portfolio has grown and seen its capabilities expand to offer larger, purpose-built and designed steel vessels. Employing over 1000 staff, the company presently operates facilities in Australia, Singapore, Vietnam and Mexico. Across

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each of these locations, the industry sectors in which Strategic Marine has been experiencing the greatest levels of growth include the military and oil and gas. As issues such as terrorism continue to bring trauma to different parts of the world, countries have made decisive moves to boost their security infrastructure. “Strategic Marine has a long, proven track record of delivering craft used for security purposes,” Anderson continues. “To date it has built 60 vessels for the Singapore Police Coastguard, 15 for the Royal Malaysian Police and over 250 patrol boats in various models to customers in Nigeria. What makes the latter figure all the more impressive is that these vessels were successfully delivered over a four year period between 2004 and 2008.”

Strategic Marine

The company has strived to diversify to service the changing demands of customers around the world

When it comes to the oil and gas sector, the company continues to benefit from a growing demand for utility vessels, crew boats, PSVs and other such craft. One current project involves the building of two, 40 metre vessels for Syarikat Borcos. These vessels will join the nine, fast, crew utility boats that Strategic Marine has already delivered to the company and have been put to use in nearby oil fields.

Throughout its relatively short history, the company has strived to diversify and expand in such a way that it is able to service the changing demands of customers around the world. The most recent example of this ability to adapt and grow is currently underway as Strategic Marine looks to enter into the ferry building business. Much like its activities in other industry sectors, this work will

“Known for never compromising on quality under any circumstance, Strategic Marine is recognised globally for being the very best at what it does� BE emea | 119

take place on an international scale and will see the company utilise its proven ability to deliver customer-specific, purpose-built vessels of the highest order. Today, Strategic Marine also finds itself pushing heavily into the offshore wind farm market. “As part of the company’s strategy to further diversify,” Anderson says, “it has entered into a teaming agreement with UK-based vessel design company BMT.” Signed in October 2011, this arrangement has already begun benefitting both parties, with Strategic Marine in the process of building the first run of boats under this partnership in Singapore. “The teaming agreement with BMT is one that both companies see as delivering long term success,” Anderson enthuses. “On one hand, Strategic Marine is able to turn to BMT to gain access to its many different vessel designs. Meanwhile, BMT now has the opportunity to partner Strategic Marine on all manner of different undertakings. It is the two-way nature of this relationship that has both companies very excited about what the future holds.” The company’s move into the offshore wind sector went a step further in May 2012, when it announced the signing of a sales and service agency agreement with the marine

and repair company, Testbank Ship Repair. As a part of its commitment to establishing a network of sales and service agents, this partnership will see the two companies working together to provide marine, ship repair and through life support services to offshore wind clients. “What this partnership demonstrates,” Anderson says, “is the commitment that

“It is Strategic Marine’s long-held belief that service and quality are paramount to a company’s prosperity, and will remain so for the foreseeable future” 120 | BE emea

Strategic Marine

Strategic Marine provides its clients with turnkey shipbuilding, planned maintenance and ship repair services

Strategic Marine has to the European offshore wind market. It highlights that the company is not merely there to sell boats. In addition to this, it is also concerned with making sure that its vessels have a long, successful life after they have been delivered.” By providing its clients with turnkey shipbuilding, planned maintenance and ship repair services, Strategic Marine is able to add real value to the vessels it delivers to the region. “Depending upon where the company takes its operations in the years to come,” Anderson highlights, “it fully expects to build on the success it has had with Testbank Ship Repair by forming similar alliances with other such companies.”

The business model that Strategic Marine has developed and adapted over its lifetime has undoubtedly brought it great success and will remain as the backbone of the company as it continues to evolve. “The issue of pricing within the market remains an important factor when it comes to winning projects,” Anderson concludes. “However, it has been Strategic Marine’s long-held belief that service and quality are paramount to a company’s prosperity, and will remain so for the foreseeable future.” For more information about Strategic Marine visit: www.strategicmarine.com

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The sky’s the limit

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Basil Read Jimmy Johnston, project director for the St Helena airport project, discusses the work being undertaken to deliver the island its own international airport and the benefits this will create written by: Will Daynes research by: Jeff Abbott

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Temporary fuel farm in Rupert’s Bay

Basil Read


ninhabited upon its initial discovery by the Portuguese in 1502, and to this day home to little more than 4000 people, the British overseas territory of St Helena remains one of the most isolated inhabited places on earth. Named after Saint Helena of Constantinople, the island is perhaps most famous for being the home of Napoleon Bonaparte during the final years of his life. Located some 1900 kilometres from the African continent, the island’s only lifeline to the wider world since 1989 has been the RMS St Helena, the only ship to regularly pay a visit to its shores. It wasn’t until 2011 that the UK government announced its plan to invest over £200 million into the building of an international airport on the island. This news was then followed by the confirmation that Basil Read had been awarded the contract to bring this massive, complex project to life. As is common place when it comes to remote parts of the developing world, St Helena has watched as large numbers of its population have left the island to seek opportunities further afield. These same people have then had to experience the logistical difficulties presented in getting to the island when they wish to return. It is hoped that the construction of an airport will open up a whole new world of opportunities for St Helena and its people. “The airport project has been on

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NAMIBIAN PORTS AUTHORITY Namibia and Namport have a special relationship with the island of St. Helena dating back to 1977 when the Royal Mail Ship service replaced the Union-Castle line and again when the current RMS St Helena came into service in 1990. Namibia has many isolated areas in this vast country and we share the same feeling with the Saints as they rely on the regular call of the RMS St Helena. As the service has also become more limited over the past few years by only calling from Cape Town, Namport has missed the regular call of this unique multipurpose vessel. When the news came that an airport would finally be built on the island, with Namport as an important staging area for its construction, it presented an opportunity

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to repay the Saints for their loyal patronage over the past three decades. Despite space limitations that the Port currently experiences due to rapid expansion, Namport has availed the Basil Read Consortium with prime land and facilities to ensure that construction continues unabated. The construction challenges that Basil Read faces on the island itself and the pioneering methods of off-loading at the island provide a case study in improvisation. Namport hopes that we can continue to play a small role in the coming years as this exciting project comes to fruition. www.namport.com.na

Basil Read

Basil Read ship in Rupert’s Bay

the cards for a number Read company in 1952 as of years,” says Jimmy a humble business that has grown significantly Johnston, project director, since its formation to “with the goal being to make the island more become a powerful brand Population of St. Helena self-sufficient and open known throughout the it up to greater levels of construction, engineering tourism. This will in turn a nd mining sectors boost the economy of St Helena and across southern Africa. Not only is the reduce its dependence on the UK.” company best placed geographically Basil Leonard Read started the Basil to serve St Helena, it also possesses all


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Basil Read

Haul road to the site

“Working in such a unique part of the world also raises a number of social and environmental issues” of the necessary design, construction and engineering capabilities to service such an undertaking. That is not to say that a company as well placed as Basil Read to serve the island hasn’t had to overcome some of the considerable challenges that its location poses. With no harbour, the company first had to create its own jetty before

then overcoming the fact that with no natural beaches it would not be possible to approach the island with normal landing craft. “A site investigation team first arrived on the island in 2007 and it became immediately apparent that getting around the unique logistical features of St Helena was going to be absolutely vital

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Basil Read

Haul road at the top of Rupert’s Valley

to the whole project,� Johnston explains. in the time since the company has Soon after the award of the contract in adapted it by adding additional fuel 2011, Basil Read set about identifying a carrying capabilities and an on-board crane capable of lifting vessel that would suit its requirements, namely the 40 tonne loads. handling of break bulk, Working in such a ability to carry a million unique part of the world litres of fuel per trip also raises a number of and the ability to handle social and environmental conta iner shipment s. issues. With the airport Distance from An offer was then made project bringing about big African mainland to charter a vessel and changes for the island and

1,900 km

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Basil Read

Working at night on the haul road

its people it has been of vital importance to have a strong degree of communication and mutual understanding between Basil Read and the local population. Furthermore, St Helena boasts a unique collection of f lora and fauna. This, together with its cultural heritage, has been taken closely into account

throughout the design and construction phases of the project. “The establishment phase of the project is now nearing completion,” Johnston continues, “with all the logistics and supply chains in place and all transport routes designated. Now the company can commence with the construction phase.”

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Servicing the International Freight Community Meihuizen International was established 30 years ago, and provides integrated logistic solutions across a wide field of diverse activities. The company is owner managed, and as such offers a hands-on service, with personal responsibility for operational details. Our solutions are focused on service excellence, an open door policy, flexibility to suit specific industry needs and an international network of established agents. This enables us to provide customised solutions and the best of personal service. Telephone: +27 21 440 5400 Info@meihuizen.co.za www.meihuizen.co.za

Our Services Include: • Shipping • Forwarding • Customs Clearing • Air Freight / Sea Freight • Road/Rail Transport • Container Groupage • Ships Agency • Antarctic Logistics & Procurement • Project Cargo

Basil Read The first task at hand is a Meihuizen International programme of major earth Arising out of our lengthy association with the island of St works that will involve the Helena, we approached Basil Read to offer our services in drill blasting and filling respect of the St Helena Airport Project, and were privileged of approximately eight to be nominated as their logistics service provider. We million cubic metres of have worked side by side with them over the last year, and rock. This will be the have found them to be an extremely professional and most agreeable client, which bodes well for our relationship focus of the company over during the contract period. In consequence we would be the next two years, after honoured to be retained by them for any future logistics which it will commence business. We wish Basil Read much success with the the building of a 1950 Airport Project and all their future endeavours. metre concrete runway, a www.meihuizen.co.za terminal building and an air traffic control tower, and the installation of airport ground lighting and navigational aids. One of the central pillars of the island achieving economic self-dependency will be its ability to attract tourists to St Helena. The potential benefit of bringing in higher volumes of visitors is something that has not been lost on either the local or the UK governments. Together the two are moving forward to First docking of any ship on St Helena put into place programmes that will enable the island Babcock International Group to easily welcome and As the exclusive distributor for Volvo Construction accommodate a projected Equipment in South Africa,Namibia, Botswana, Zambia, 20,000 tourists per year. Mozambique, Zimbabwe, Swaziland and Lesotho, Babcock Various developers are International Group offers a full after market support in the process of planning capability including maintenance, repair and overhaul utilising a network of comprehensively equipped dealers, where to build hotels on branches, workshops and service centres. Babcock the island, while at the back the Volvo brand with experienced staff to support same time great efforts customers quickly and efficiently – wherever they are. and resources are being put Our market-leading reputation is based on one key fact: into improving the entire Babcock is a partner that can be trusted to deliver.t. infrastructure of St Helena. www.volvoce.com | www.babcock.co.za What the government

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Dry gut - position for main fill

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Basil Read

1952 Basil Leonard Read started the company wants is for those people visiting the island to be able to get around and enjoy the usual luxuries they would experience when on holiday, all against the unique, picturesque backdrop that St Helena creates. Outside of the tourist sector, the very location of the island, halfway across the Atlantic, provides it with the opportunity to act as a stopping point for business air traffic from South America. Opening up the air space around the island could also prove invaluable to business flights making the journey from southern Africa to Europe as it would reduce the potential for delays that occur when flying through another country’s airspace. “The potential for St Helena to achieve significant economic growth and dependency is there for all to see and is clearly linked to the building of its international airport,” Johnston concludes. “It is now the job of DFID, the St Helena government, local businesses and companies like Basil Read to ensure that this potential is realised.” For more information about Basil Read visit: www.basilread.co.za

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Growing new routes

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Intercape Chief commercial officer Danie du Toit talks about a phase of expansion at South African coach services company Intercape, and the latest luxurious addition to the Sleepliner fleet written by: Gay Sutton research by: Paul Bradley

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In house brake testing



ust two years ago, travelling from Lilongwe in Malawi to Cape Town in South Africa, a distance of over 4,000 kilometres, would have entailed either an arduous and very lengthy car journey, or an expensive and often unreliable flight that might have included changes in Johannesburg and Harare, Lusaka or even Nairobi. Such journeys notoriously included long delays and interminable airport waiting times with, of course, the always present fear that your baggage will not arrive at your destination with you. Today, that spectacular and epic journey is possible in comfort. One simple ticket transaction can procure the entire trip on one of the world’s most luxurious coach networks, cared for by staff trained and equipped to the highest standards of safety and service. All this has been made possible by the rapid international expansion over the past two years of South African coach operator Intercape. “There has been a tremendous increase in demand for our services,” explained chief commercial officer Danie du Toit. “After two years of expansion, we can connect all major cities within seven countries; South Africa, Namibia, Botswana, Zimbabwe, Zambia, Malawi and Mozambique. And the service we provide is of the same high standard throughout, so our passengers know exactly what they will get. This has been a great differentiator for us.” It’s a tough business to be in, particularly in Africa where the road infrastructure and public driving standards pose significant

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For all your luxury coach requirements please do not hesitate to contact us on tel + 27 12 6611927 or e-mail us on reception@irizar.co.za


“We introduced the Sleepliner coach in 2005 and it has set the trend in the market” challenges. Many operators have tried it and failed, but Intercape has developed a highly effective operational model over some 30 years. “It’s not easy to get right,” du Toit warned, “but we have maintained a culture of improvement throughout this time, and have improved our service year on year. Ultimately, success is a combination of the type of vehicle you put on the roads, the infrastructure you put in place to ensure the service is always reliable, comfortable and safe, and it’s down to developing business processes to deliver the same standard of service regardless of location.” Intercape’s model is based on a blueprint of best practice that is rolled out throughout the enterprise. “One element of this is that we have a set of policies and procedures that cover everything from fleet maintenance and ticket sales through to driving standards, HR and finance. Alongside this, we have an integrated IT system which is the backbone by which we run the company.” Developed in-house and continuously improved and updated, the IT system can be accessed from anywhere in the extended enterprise. That might be staff looking for real-time data and reports,

drivers and mechanics managing the coach fleet, booking staff and external agents using the integrated ticketing processes or the passenger looking for booking information online. Running a successful transport network the size of Intercape’s requires a very extensive sales and fleet support infrastructure. There are currently 30 Intercape sales offices and hundreds of authorised sales agents selling tickets across southern Africa. Meanwhile, to keep the coaches running reliably and safely, Intercape has a network of six technical depots in South Africa. Significant

Wash bay

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G7 Interior

investment has already gone into creating done in South Africa.” a similar support network for the crossThe vision is to continue expansion border service. There are currently depots through southern Africa, and to explore in Windhoek, Namibia, and Beira in other transport-related revenue streams. Mozambique, and the company is exploring “We are already hauling large trailers the feasibility of opening further depots in capable of carrying seven tons of luggage Zimbabwe and Zambia. and freight behind each of our cross-border The expansion programme has coaches,” he explained. “And we are looking undoubtedly been a financial and operational at ways of increasing freight transportation. success. In just two years Intercape has We also believe there is a big market for moved from being a purely South African fixed-term people transport contracts operation, to generating some 30 percent of with, for example, the mining companies. its business through crossWe are looking to enter that border services. But this, market.” du Toit believes, is only the Intercape’s enviable beginning. “Our next step is reputation for comfort, to create connecting services reliability and safety is due within the borders of our to its willingness to invest Intercape business neighbouring countries, not only in processes and now generated through creating internal transport infrastructure but also cross-border services networks just as we have in the very latest vehicle


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“We have a set of policies and procedures that cover everything from fleet maintenance and ticket sales through to driving standards, HR and finance” technology. “We introduced the Sleepliner coach in 2005 and it has set the trend in the market, bringing us great success,” du Toit said. Sleepliner is a concept unique to Intercape, and is a blend of style, technology and intelligent design. The chassis and engine come from Volvo in Sweden and the latest models comply with the rigorous Euro 3 Emissions Standards while the double deck coach body is imported from

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the coach manufacturer Marco Polo in Brazil. Alongside the double deck coaches, Intercape runs a fleet of single deck coaches that combine a coach body from Irizar of Brazil with a Volvo chassis. “We are now in the process of updating the Sleepliner with the latest G7 model,” he continued. The first new G7 model Sleepliners are now in service, and are easy to recognise with their modern, sleek and


Customers can be assured of a pleasant experience

aesthetically pleasing lines. Yet the real improvements in customer comfort and safety can be found inside. There is ambient LED lighting activated by motion sensors, and memory foam seats that recline to 150 degrees and are positioned to provide more leg room, making long distance journeys a much more comfortable experience. The new coaches also cater for business travellers and those with an active mind. Power sockets are provided for laptops and cell phones, transforming the travel time into a fruitful working opportunity or leisure experience. There are broader entrance doors, and these are the first coaches in southern Africa to come equipped with a wheelchair to transfer passengers with disabilities

from the entrance to their seats. From the technology perspective, the cab is equipped with the latest in situational awareness for the driver while the engine compartment has been updated to include the most advanced fire detection and suppression systems. So, as Intercape expands its routes and support network across southern Africa, and equips it with the latest invehicle technology, customers can be assured of a pleasant experience on those long scenic journeys. For more information about Intercape visit: www.intercape.co.za

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Handled with c As the first port of call for ocean-bound imports and exports, the Port of Dar es Salaam’s contribution to Tanzania’s growth as a nation is beyond measure written by: Will Daynes research by: Abi Abagun

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Port of Dar es Salaam


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rom the wilds of the Serengeti plains to the vibrant tropical beaches of Zanzibar, the country of Tanzania is home to an array of tribes and cultures. Steeped in tradition, the history of Tanzania dates back to the early days of mankind, with men and women across the world still considering it to be their true place of origin. Situated on the edge of the African continent, the Tanzania of today is not only recognised for its historical significance and natural beauty, it is also home to a blossoming economy. Over the last 25 years, significant measures have been taken to liberalise the country’s economy and encourage both foreign and domestic private investment. The results of this sustained effort are evident in the fact that between 1998 and 2007, Tanzania’s GDP per capita grew by more than 40 percent. Playing a core part in the growth of the country is the Port of Dar es Salaam. Tanzania’s principle port, it handles approximately 95 percent of its international sea trade. Located some 41 nautical miles southeast of the Port of Zanzibar, and around 170 nautical miles south of Kenya’s Port of Mombasa, the Port of Dar es Salaam is owned and operated by the Tanzania Port Authority. Despite the fact that its harbour is almost virtually landlocked, the port acts as the main export point for the majority of the country’s agricultural and mineral exports. With enough capacity for 4.1 million tonnes of dry cargo, six million tonnes of bulk liquid cargo, 3.1 million tonnes of general cargo,

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Dar es Salaam Waterfront

Port of Dar es Salaam

Port of Dar es Salaam

The port has capacity for one million tonnes of containerised cargo

and one million tonnes of containerised terminal, meanwhile, comes equipped cargo, it serves neighbouring countries with eight deep water berths that cater Zambia, Malawi, Burundi, Rwanda, Uganda for dry break-bulk cargo. Boasting eight and the Democratic Republic of the Congo. sheds with a total floor area of 81,040 Not only is the port strategically placed to square metres, the terminal has an annual serve as a convenient freight link to and from capacity of 2.5 million tonnes. In order to handle such a high volume eastern and central African countries, it also has the of cargo it has 28 portal ability to serve customers cranes, 27 yard cranes, 119 forklift trucks, 44 tractors based in the Middle and Far and 86 trailers available. East, Europe, Australia and the US. Among the fleet of Currently running at maximum capacity, the vessels at the port’s disposal Tanzania Port Authority are six berthing tugs, 16 light towing tugs, two pilot continues to invest heavily Tonnes of import and boats, two patrol boats and in infrastructure, personnel export cargo handled in 2010/2011 13 mooring boats. and various processes. The port’s general cargo One of the more recent

2.441 million

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Jos. Hansen & Soehne GmbH is a well known and experienced German based supplier and engineering company with subsidiaries in Africa. Jos. Hansen has structured its business to cater for 6 different sectors: • Machinery and Industrial Equipment; • Geodetic Instruments and Broadcast Systems; • Equipment for Research, Education and Health; • Pumps, Valves and Pipes; • Energy Industry Solutions; and • Water Engineering

Training by the Manufacturer’s Engineer on the supplied Heavy Duty Fire Tender to Dar es Salaam Port by Jos. Hansen & Soehne (Dec. 2011).

Heavy Duty Fire Tender Manufactured by BAI and supplied by Jos. Hansen & Soehne GmbH for Dar es Salaam Port (Dec 2011)

Head Office: Telephone: + 49 40 30 304 0 | Email:info@joshansen.com | www.joshansen.com | www.amiantit.com Local Office: Telephone: + 255 22 2112948 | Email:jhs-t@africaonline.co.tz | www.joshansen.com

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Port of Dar es Salaam examples of this investment Jos. Hansen & Soehne has seen the port enter Jos. Hansen & Soehne GmbH was established in 1919. For into a partnership with the more than 90 years, Jos. Hansen has played an active US, creating a One Stop role in Africa, including Tanzania. It has maintained a very Centre (OSC). Housing 11 close relationship with projects financier like: KfW, ADB, government agencies in one World Bank and EDF among others. Some of the projects building, where all cargo accomplished by Jos. Hansen for Dar es Salaam Port are: • Supply & commissioning of cargo gear & fittings; related paper work will be • Supply of workshop equipment & various plants; handled, the presence of • Supply of one reach stacker; the OSC will drastically • Supply of 20 ton mobile crane; and reduce clearing process • Supply of heavy duty fire and rescue vehicle. times and therefore reduce www.joshansen.com congestion at the port. One of the other challenges the Tanzania Port Authority is looking to overcome is the fact that, at present, the port is only able to handle vessels no more than 10.5 metres in depth and with a quay length of 240 metres. In order to cater for vessels of ever-increasing size, plans are underway to deepen the harbour and widen the port entrance. During the 2010/2011 financial year, the performance of the Port of Dar es Salaam rose by 16 percent compared with the previous twelve months following the Tanzanian government’s decision to disband a monopoly of container handlers at the port. Under this monopoly, the port handled 304,155 containers Cargo ship enters port

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Port of Dar es Salaam The port has reduced the time taken by visiting vessels to offload their container shipments

during 2009 and 2010. Within a year of allowing other container handlers to operate in the port this figure had risen to 352,737 containers. This notable improvement in performance has subsequently caught the attention of other importers and exporters from surrounding countries. The decision these businesses have taken to opt for the Port of Dar es Salaam to handle their consignments has seen the volume of handled imports and exports from neighbouring nations rise from 2.332 million tonnes to 2.441 million tonnes in the year 2010/2011. Other significant improvements include a reduction in the amount of time taken by visiting vessels to offload their container shipments. Primarily a result of the port’s ability to now handle five vessels simultaneously, as opposed to just three previously, this has also contributed significantly to the reduction in its import container dwell time and ship turn-around times, the latter falling from eight days in June 2010, to 7.3 days in June 2011. Over the past twelve months improvements at the Port of Dar es Salaam have continued and have resulted in its export volume increasing by around $1 billion in value. This in turn has contributed significantly to the growth of Tanzania’s total value of export goods and services to more than $8 billion. For more information about Port of Dar es Salaam visit: www.tanzaniaports.com

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Attracting investment The first free port of its kind in the Philippines, the Port of Subic Bay has become an area of significant economic importance for the region written by: Will Daynes research by: Abi Abagun

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Port of Subic Bay

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The Port of Subic Bay

Port of Subic Bay


acing the South China Sea, 110 averaged $1 billion in value, while the kilometres north of Manila, number of jobs created now number well Subic Bay is the first successful over 60,000. During the period between case of a former military base 2006 and 2009, the total active workforce being converted into a tax and within Subic Bay Freeport increased from duty free zone in the Philippines. The 63,485 to 87,226 workers. This significant port is operated and managed by the Subic increase in manpower also coincided with a Bay Metropolitan Authority (SMBA), and rapid acceleration in cumulative investments. the stunning mountain ranges and deep, From 1992 to 2005, investment in the port natural harbour provide the bay with totalled $2.346 billion, while between 2006 excellent anchorage properties. They also and the end of 2009 this figure reached offer natural shelter from the typhoons and $5.958 billion, representing an increase of other extreme weather phenomena that can over 150 percent during that four year period. affect the region. It was also during this hugely successful Established in the aftermath of the passing period of time that the SBMA was able to attract 314 foreign projects of the Bases Conversion to the free port with a and Development Act by the Philippine Congress, corresponding foreign direct Subic Bay Freeport stands investment value of just on the site of a former US under $2.5 billion. The most Naval facility. Created in significant of these projects Volunteers involved in anticipation of the pull-out came from the company the port construction of US naval forces, 8000 HHIC-Phil, also known as volunteers came together Hanjin Shipping. In the years to preserve and protect $8 billion worth of 2006 and 2007, the company committed property and infrastructure when the last US $1 billion and $0.68 billion, respectively. Hanjin Shipping’s actions alone helped vessel sailed out of the area in November 1992. By its fourth anniversary in 1996, when it radically boost overall foreign investment also played host to the leaders of 18 economies with the free port zone by more than as part of the APEC leaders’ summit, 12,800 percent and coincided with the Subic Bay Freeport had already attracted company opening a modern, state-of-theinvestment from the likes of Federal Express, art training centre within Subic Bay. Its Enron, Coastal Petroleum, Thomson SA and investments also took the SBMA to the Acer. The years since have seen Subic Bay top of the list of Philippine investment continue to progress into what is today, a self- agencies in the first and second quarters sustaining tourism, industrial, commercial, of 2006, and took the level of committed financial and investment centre. investments within the Subic Bay Freeport Since 1997, exports from the port have zone beyond the $1 billion mark.


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Port of Subic Bay Perfectly positioned alongside Asia’s ocean-going commercial traffic lanes, Subic Bay Freeport continues to offer an attractive alternative to the frequently congested Manila International Container Terminal. Recognised as being of critical importance to the Philippine economy, the free port is home to more than 700 investment projects that, when combined, are valued at over $5 billion. Among these one will find the world’s fourth-largest ship building facility, owned and operated by Construction (Korean). As stated, the primary function and strategy of the SBMA is to manage and develop the free port area for it to reach its full economic potential. Achieving this goal requires both the bringing in of investment and the maintaining of the highest standards of service. To this end, the SBMA has spent considerable capital on areas including technology, environmental consultancy and infrastructure development. Recently it has entered into a joint venture partnership with the multinational metals and mining company Vale to bring a large floating terminal for iron ore to the Subic Bay Freeport. In addition, Vale is investing in the construction of a ten hectare warehousing facility, while also planning the creation of a processing plant and a new jetty. With a set of strategic goals that involve increasing connectivity to China and Hong Kong, and increasing the amount of revenue the free port generates, the SBMA continues to successfully attract local and foreign investment. As well as providing considerable socio-economic benefits to local communities and the country as a

The port is perfectly positioned alongside Asia’s ocean-going commercial traffic lanes

whole, the SBMA continues to pursue the development of the free port in a way that promotes the concept of environmental protection amidst rapid development. Today, under the leadership of the SBMA, the Subic Bay Port Development Project is transforming the free port to allow it to become part of the Subic-Clark Corridor. Based around the 45 kilometre long SubicClark-Tarlac Expressway, this development will further contribute to the Subic Bay Freeport becoming a core part of one of the most competitive international shipping services in Southeast Asia. For more information about Port of Subic Bay visit: www.sbma.com

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ering the goods Growing from a small family business into a leading logistics organisation, TCM LDA is playing its part in supporting the development of one of Africa’s fastest-rising nations written by: Will Daynes research by: Abi Abagun

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Transport networks are of fundamental importance to the country’s economy


lessed with rich and extensive natural resources, Mozambique’s recent past was sadly defined by the prolonged civil war that lasted from 1977 until 1992. In the two decades since, the country has risen from the ashes to become one of Africa’s up-and-coming points of interest for tourists and businesses alike. Divided by the Zambezi River, the country’s northern and southern regions are very different, the former being regarded as one of the continent’s last frontiers while the latter has become the centre of Mozambique’s economic resurgence. Although it remains dependent upon foreign assistance, the last 15 years have seen the country reach macroeconomic stability and experience impressive economic

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growth. This has resulted in significant investments being made in Mozambique’s infrastructure. In 2010, Mozambique’s GDP was estimated at $21.81 billion, representing an 8.3 percent increase on the previous year. The economy of the country is largely based on agriculture, however various other industry sectors, including chemical manufacturing, aluminium and petroleum production and food and beverages are continuing to grow rapidly. Mozambique’s main trading partner and key source of foreign direct investment is South Africa, however it also counts Portugal, Spain and Belgium among its more important partners. The diverse range of commodities that the country produces on a large scale include cotton, cashew nuts, sugarcane, tea,


cassava, corn, coconuts, sisal, tropical fruits, Default Rating being classed as stable by potatoes, sunflowers, beef and poultry. Finch Ratings, the country spent the latter Its main industries meanwhile include months of 2011 re-negotiating legislation on food, beverages, chemicals, aluminium, taxes and royalties with mining companies petroleum products, textiles, cement, glass in order to significantly increase government and tobacco. Virtually all of the country’s revenues and reaffirm its commitment to manufacturing activities, meanwhile, are achieving long-term economic growth. Transport networks are of fundamental located in the major urban areas of Maputo, importance to the country’s Beira, and Nampula. A signatory of the economy with South Millennium Declaration, Africa and its land-locked Mozambique is able to neighbours, Ma law i, Zambia, Zimbabwe and bolster its domestic economy Swaziland all being key through the continued users of the Mozambican export of aluminium, prawns, cashews, cotton, transport system. Established in 1991, TCM sugar, and timber and bulk 2010 GDP for Mozambique began life as a small family electricity. With its longterm foreign currency Issuer business. From its humble

$21.8 Billion

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TCM has transformed into a major player within the transportation sector

beginnings, the company has grown through a simple combination of hard work and focus to become one of Mozambique’s largest and most efficient logistics organisations. As the region itself has developed, TCM has transformed into a major player within the transportation sector of the southern part of the country. Its state-of-the-art fleet of vehicles, capable of loading both normal and abnormal cargo, continue to help set it apart from its competitors. By taking advantages of the benefits Mozambique has as a country over its land-locked neighbours, TCM has been able to expand its operations beyond the border and into the likes of Malawi,

Zimbabwe and Zambia. Wherever its activities take place, TCM is constantly striving to provide its customers with safe, efficient and on-time services. The strides TCM has made over the last two decades have been rewarded, not only in the form of increased business opportunities, but also in the form of industry recognition and awards. Recently KPMG, one of the largest professional service companies in the world, identified TCM as one of the top 100 companies in Mozambique. This acknowledgment was subsequently backed up with it also being named amongst the top ten companies in the country operating within the field of logistics.

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Novo Mundo - Viagens e Turismo, Lda. was formed on the 22nd July 1997 and oficially opened her doors in May 1998 at the Rovuma Carlton Hotel Shopping Centre, where we are currently based. Our vocation is sales domestic and international air tickets, with one of her founders having many years of experience at Mozambique´s nacional airline, immediately expanding to all areas of outgoing tourism. In 2000, Novo Mundo affiliated herself with IATA and the Beira branch was born and at the same time expanding her activies to incoming tourism.

Visit us at: www.novomundo@odline.com

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TCM LDA By embracing technology Novo Mundo Viagens e Turismo, Lda as part of its operations, As travel and tourism consultants, we strive to provide and by updating solutions the best service possible, operating to high standards and developing new when serving the needs of all our customers, whether for technologies, the company business or leisure trips. puts itself in the best position We are proud to have been built upon ethics, morals, to meet the ever-changing commitment and sincerity and have done our best to promote these characteristics in our staff. needs of the market place. We are privileged to be involved with and of service to One of its most important TCM Lda, and look forward to our continued professional developments in recent years working relationship. has been the introduction of www.novomundo.odline.com a 24-hour command centre. Here the company has the technology needed to monitor each of its vehicles via satellite trackers. This further ensures that cargo deliveries get to their intended destinations on time and in perfect condition. Additionally, this technology allows TCM to monitor the wellbeing of its drivers and communicate any issues or challenges to its head office. As Mozambique continues to grow as a nation, these are exciting times for those businesses operating therein. With increasing volumes of cargo entering the country, specifically through the Ports of Beira and Maputo, to service not only Mozambique, but also its land-locked neighbours, there is a growing demand for the services that TCM offers. It is for this reason that it understandably has high expectations for the future. There is a growing demand for TCM’s services

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A w

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CeskĂŠ Radiokomunikace

Making waves

A modern broadcasting and telecommunications company with the aim to develop and strengthen its market position by a continual improvement of services written by: John O’Hanlon research by: David Brogan

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Václav Aulický’s unique telecommunications tower in Prague

eské Radiokomunikace


amil Levinsky has been at the helm of eské Radiokomunikace, the company he joined in 2007, for just over a year. This is an exciting time for the much evolved broadcaster with a strong stake in communications infrastructure, new platforms and constantly changing modes of data interchange – not to mention runof-the-mill developments like the shift from analogue to digital radio and TV currently being implemented in the Czech Republic. eské Radiokomunikace traces its origins back to 1963 when it was the Czechoslovak government department for radio communications. Privatised after the restoration of democracy in 1989, it went through restructuring to become a full service provider of electronic communications and broadcasting services. In 2010 it was acquired by MIRA, a fund management company within the Macquarie Group, now the sole shareholder. One of the largest telecoms organisations in the modern Czech Republic, it has three principal business streams. It provides a broadcasting platform over the airwaves for government and licensed broadcasters; it offers comprehensive voice data and internet services; and since it owns hundreds of structures and buildings throughout the country, including Václav Aulický’s unique telecommunications tower in Prague from which, as from its other assets, it leases space to other telecommunications operators. Twelve digital television and eight radio stations broadcast from the Žižkov Television Tower as well as another six

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60% Czech households receiving digital TV

Top of a broadcasting tower

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analogue VHF radio channels. And eské Radiokomunikace is the operator of three out of four digital TV multiplexes in the Czech Republic—it owns two commercial DVB multiplexes including that of Czech Digital Group acquired in 2010, and operates the multiplex owned by the national broadcaster eské televize. With the switch over from analogue to digital complete, the company is now focusing its efforts on the rollout of DVB-T2, the second generation digital system that is more effective as a carrier of HD (high definition) TV content with the ability to provide pay TV over terrestrial platform. Around 60 percent of Czech households are now receiving digital TV, which launched in 2008, and that number is rising steeply. Cable and satellite remain fairly flat at around 20 percent. In July 2012 the Czech Telecommunication Office gave the go-ahead to eské Radiokomunikace to start experimental DVB-T2 broadcasting from Prague and Plze – in time to show HD coverage of the London Olympics. “We negotiated inclusion into an experimental DVB-T2 multiplex with eská televize, Prima and Barrandov for HD. Since so many Czech households now have widescreen HD sets, migration to higher standard TV broadcasting is a logical and

eské Radiokomunikace

Multiplex - digital broadcasting technology

natural step. We are committed to showing the viewers that terrestrial broadcasting can provide them for free with the same high quality content as via cable TV or satellite.” Radio is still broadcast as an analogue service in the republic, and though radio is a highly diversified field, eské Radiokomunikace broadcasts 98 percent of the stations transmitted domestically, including Radio Prague and the regional stations operated by the national carrier eský Rozhlas. In addition it supports the four competing mobile phone companies Telefónica O2, T-Mobile, Vodafone and

U:fon, offering them space on its 600 towers. “Using our infrastructure in rural areas is a lot more cost effective for mobile operators than building and owning their own towers,” he points out. Control of the infrastructure is an important strategy. “We live or die by our reliability in the market, particularly in corporate data services,” says Levinsky. “We own the city networks and also 2,600 kilometres of fibre and microwave infrastructure.” He goes on to say that this is a 100 percent redundant system. Redundant in the engineering sense that there is always

“Since so many Czech households now have widescreen HD sets, migration to higher standard TV broadcasting is a logical and natural step” BE emea | 179

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at least one alternative route for any data communication – the client will never detect a failure; a very significant asset for corporate clients for whom security of communication is business critical. However, for these clients the security of their data is just as critical. In 2010 eské Radiokomunikace came to realize that the telephony market was on the decline – at least as far as the fixed network was concerned – and that having established itself as firmly in control of the physical infrastructure it needed to start looking at the future of business communications. It concluded that the path led clearly in the direction of smart cloud services – so it launched Smart Cloud a year ago. Smart Cloud offers business clients the opportunity to store, manage

eské Radiokomunikace

Microwave radio technology (at Prague tower)

and distribute all their data using eské Radiokomunikace’s infrastructure, which has been extended to a data centre based in the Prague Tower. At first, take-up was slow, Levinsky admits. “Though the savings to our clients are truly significant – they typically work out at around 60 percent of their IT spend – businesses are reluctant to lose control, as they see it, of their critical data: but they

don’t lose control of it! When we launched the Smart Cloud services we were the only company in the Czech Republic that could link its ring-fenced virtualized server to its own telecommunications network. It is a completely secure environment for running business applications.” This message is beginning to get though as companies realise that they can get reliable IaaS (infrastructure as a service), PaaS (platform

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“It’s only a cloud based system in the sense that it is virtual – the data remains inside a private network”

The 91 metre Ješted broadcasting tower in the north of the Czech Republic

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eské Radiokomunikace as a service) and flexible data management over powerful servers with data backup and long term archiving. Clients still need a lot of reassurance before they will entrust their data to a third party, but this offers them state of the art outsourcing firmly located in their own backyard – understandably they don’t like the idea of their data being warehoused in Ireland or India. eské Radiokomunikace needed to populate its data centre with servers that delivered virtualization and costefficiencies but were entirely secure, so it deployed the Cisco Unified Computing System, consisting of 30 servers powered by Intel 5600 Xeon processors that provide all the control they could wish for – as Levinsky explains: “Some people are scared off by the name. It’s only a cloud based system in the sense that it is virtual – the data remains inside a private network.” An added advantage for business clients, he adds, is that the service is completely scalable, and if their business is seasonal their fees will contract or expand with their demands. The business has changed radically since Levinsky joined it five years ago. It is financially much more stable, relying less on short term contracts and more on sustained partnerships. “We got out of activities where we didn’t think we could

The 59 metre Radhošt broadcasting tower in the eastern Czech Republic

add value, like retail telecommunications and now we are concentrating on business to business solutions.” Moving into the ICT space and staying ahead in that space is his number one priority as the bread and butter channels become commoditised. Some large government outsourcing contracts are coming up for tender: if eské Radiokomunikace can land these contracts and significantly increase its stake in public sector data and voice services Czech taxpayers will gain the benefit already seen by corporate clients. For more information about Ceské Radiokomunikace visit: www.radiokomunikace.cz

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M2M: not just for B2B Digital communications are opening many new opportunities. This Spanish telecoms giant is taking full advantage of machine to machine (M2M) technology written by: Alan Swaby research by: David Brogan

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Telef贸nica flagship store



n any visit to Spain, it’s impossible not to notice the presence of Telefónica. This is the institutional face of Spain’s principal telecommunications company which is presented to both the business and domestic sectors through the ubiquitous Movistar brand. Since 2006, O2, another of the bigger players in the cellular mobile market, has also been part of the Telefónica family. In fact these days, Telefónica has moved a long way from what was once a purely national operation, set up in 1924 as CTNE with the aid of ITT. At the end of World War II, the business was effectively nationalised with the Spanish government taking 79.6 percent of CTNE shares and by the 1960s, CTNE had become the #1 Spanish enterprise with 32,000 employees. By the time the Spanish government sold its shareholding and Telefónica had returned to completely public hands in 1999, the business was already international with interests principally in South America but also in key markets throughout Europe and the Far East. Today it operates in 25 countries and has a workforce of 287,000, generating revenues of €63 billion. Telefónica is well and truly one of the leading integrated telecommunication providers, ranked 6th largest among terrestrial mobile phone network operators as measured by number of subscribers. As of June 2012, Telefónica’s total number of customers amounted to 311.8 million and of these, more than 75 per cent came from outside its home market.

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$8 Billion Estimated value of M2M market by the end of this year

Entrance to Telefónica’s flagship store

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It’s with this global market very much in mind that Telefónica announced in July this year that it was pressing for the establishment of international collaboration and cooperation in the advancement of cellular M2M technology and had helped form an alliance of like-minded telecoms operators. In itself, there is nothing new about M2M – or machine to machine – communications. The concept has been around in one form or another for decades under numerous titles. Effectively it refers to any technology that allows a remote device to transmit data to an application somewhere else, either by wired systems or wireless. Originally, this invariably meant a remote network of machines relaying information back to a central hub before being re-directed to a PC for the data to be processed. Even cellular M2M has existed for over two decades since Siemens launched a GSM data module based on one of its mobile phones for M2M industrial applications, enabling machines to communicate over wireless networks. Modern M2M communication progressed with the expansion of IP networks across the world, opening new business opportunities. Now Telefónica has teamed up with


Telefónica is known to both the business and domestic sectors through the ubiquitous Movistar brand

leading mobile operators in Europe, the East and Australasia who will discuss ways in which they can provide a seamless solution for the provision of M2M communications to multinational customers. Although the initial grouping consists of seven businesses, Telefónica has stressed that the initiative is open to other operators. The goal is to stimulate the sale of M2M communications across a number of distinct high-potential industries such as consumer electronics, automotive, energy efficiency, etc, enabling the development of new business models, the creation of new

products and services and a reduction in operational costs for these target industries. The Telefónica initiative is based on using an existing platform from Jasper Wireless in the USA—one of the leading exponents of M2M technology. Jasper estimates that the M2M market will be worth $8 billion by the end of this year and by building on its technology, network operators can quickly enter the M2M market. The traditional markets for M2M applications, such as fleet management, vehicle telemetry and energy monitoring smart meters are expected to be joined by

“M2M refers to any technology that allows a remote device to transmit data to an application somewhere else” BE emea | 189

other consumer directed offerings, many of which simply haven’t even been thought of yet, but will be once the technology is in place. As the Jasper platform has the advantage of being a cloud based service, both operators and customers should find faster times for products to get to market and continuous innovation. Although Telefónica was a key mover in getting this alliance underway, it is very much a case of equality across partners, enabling all operators to benefit equally in

terms of providing better services at lower costs. The opportunity is there for all to develop partnerships with key regional players rather than expanding individually country by country. And of course, it should never be forgotten that multi-operator schemes such as this are particularly attractive to key corporate customers who also work across global markets and want the simplicity of a compatible system for their communications across borders.

“The goal is to stimulate the sale of M2M communications across a number of distinct high-potential industries”

The CNSO (National Centre for Supervision and Operations) control room

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Telefónica and Mozilla pioneer first open web devices

The above scheme is ideally suited for Telefónica’s global plans but the company is equally keen to develop M2M on the local scene. It has recently jointly invested €3 million in the Barcelona based technology company AddFleet with the aim of promoting the commercialisation of the company’s products worldwide. It has developed a new mobility system based on M2M technology and cloud computing that uses mobile devices to connect vehicles to taxi dispatch centres and to potential taxi users. Taxi dispatch centres are currently managed using analogue radio systems, with the distinct disadvantage of not enabling direct communication between the three

parties: dispatcher, the vehicle and the user. Instead of expensive investments in communications that can only be used in the taxi, AddFleet’s technology allows the driver to receive the same information but via his mobile phone, paying only a small fee on the receipt of each new fare. Telefónica has developed into the global force it is through the timely application of new technology and it expects that the growing interest in cellular M2M will contribute further to the company’s growth. For more information about Telefónica visit: www.telefonica.com

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Connecting a nation

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Sri Lanka Telecom Chief executive officer Greg Young discusses the ways in which the company is helping transform Sri Lanka into an information and telecommunications hotspot

written by: Will Daynes research by: David Brogan

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High speed data fibre metro ethernet

Sri Lanka Telecom


ri Lanka Telecom (SLT) has built over 150 years of goodwill and trust with its valued customers protecting its brand image and company values. SLT‘s role in the continuing development of the Indian Ocean island is perhaps best summed up by its own slogan, “One Country. One Voice.” SLT envisions a not-too-distant future where the citizens of the country are united through the concept of connectivity. From the days when it was a part of Sri Lanka’s Department of Post and Telecommunications through to the present day, the company boasts a long and rich history. Now a fully integrated telecommunications operator, with a customer base of more than five million that include multinational corporations, public sector firms, and retail and domestic users, SLT today has achieved recognition as one of the most respected entities in the country. “We provide triple-play services to our customers through fixed wire line (Megaline), public switched telephone networks (PSTN), asymmetric digital subscriber line (ADSL) broadband access and our IPTV pay television service (PeoTV),” explains chief executive officer, Greg Young. By owning and operating an extensive, national, optical transmission network connecting all parts of the country, SLT is able to meet the needs of both its fixed business customers and those of its fully owned mobile subsidiary Mobitel. In addition, the company has ownership in four

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submarine cables that leave Sri Lanka and connect up to South East Asia, the Middle East, Western Europe and surrounding nations such as India and the Maldives. The telecommunications market in Sri Lanka has experienced rapid growth over the last six-to-seven years, driven by competition in the marketplace and the adoption of mobile telephony by the masses. Today, it is the Sri Lankan government’s intention to build upon this growth and establish the country as an information and communication technology hub, with one specific strategy being to drive broadband penetration and availability. “As the national telecommunications provider, it is heavily incumbent upon us that we support these national growth

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Sri Lanka Telecom

SLT’s PeoTV controlling panel observe quality of feeds before IP multicasting via SLT broadband

objectives,” Young continues. “We take our role in this very seriously and thus have geared both our long-term strategy and short-term investment plans to ensure we deliver against these targets.” One of the most important ways in which SLT is supporting the government to achieve its aims is through its flagship i-Sri Lanka project, which is geared towards driving nationwide network modernisation.

“Since 2011,” Young says, “we have embarked on our most ambitious and capitally intensive expansion programme over the last decade in order to bring improved service quality and innovative products to customers. Augmenting the existing copper-based network through fibre-to-the-node technology, i-Sri Lanka will revolutionise broadband access across the country.”

“SLT‘s role in the continuing development of the Indian Ocean island is best summed up by its own slogan, ‘One Country. One Voice’.” BE emea | 197

The target of i-Sri Lanka is to achieve broadband speeds of up to 20 megabits per second for more than 90 percent of fixed customers by mid-2013. “With triple play,” Young enthuses, “this introduces a world of entertainment options through PeoTV to more than one million fixedline customers through the SLT Megaline connection, together with an enhanced broadband experience.” Sitting behind the benefits that this fibre-to-the-node programme will bring to its customers are the advantages it will provide SLT. “Reducing the length of the copper cables significantly reduces maintenance costs, reduces the propensity for damage from lightning and replaces a lot of the decades old, aging copper that has become less reliable,” Young says. “In turn this improves reliability and performance, and delivers an all-round better quality of service.” SLT embarked on the transformation programme a number of years ago, laying the foundation for the favourable results of today. “Having laid the groundwork and infrastructure, and refocusing our plans,” Young elaborates, “we are well prepared for the changing demand for telecommunication solutions. We have

MSAN deployment

taken our role as a strategic partner in this future journey very seriously. Our strategies now focus on customer centricity which is primary and remains at the axis of our objectives. Innovation, responsiveness, teamwork, business processes, increased productivity, prudent cost management, strategic investment, governance and best practices, values, ethics, transparency and technological advancement have

“Augmenting the existing copper-based network through fibre-to-the-node technology, i-Sri Lanka will revolutionise broadband access across the country” 198 | BE emea

Sri Lanka Telecom

t and optical fibre laying by SLT technical staff, achieving pre-set goals of the ongoing flagship i-Sri Lanka project

and modernisation of the all been addressed in network. “This is being ou r c ompr eh en si ve Transformation evidenced through projects Programme.” such as i-Sri Lanka, the Nationwide Optical Fibre Th rough what it Year-on-year increase in Backbone Network (NBN), describes as ‘prudent group profits for the first international submarine and disciplined’ financial half of 2012 capacity, FTTN to drive management, SLT has ma naged to deliver broadband penetration and significant profit growth ICT enablement, as well as over the past two years. Before tax profit expansion of mobile broadband and voice for 2011 has shown itself to be three times coverage. A group investment exceeding that of 2009, while results from the first Rs. 25 billion in 2012, which is more than half of 2012 show a 15 percent year-on- double the annual average over the past year increase in group operating profit. decade, is also planned.” Young asserts that this strong financial “On the mobile side of our business,” Young performance is being leveraged to fund says, “we are experiencing the same trends heavy capital investment into expansion being seen around the globe, specifically


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SLT Technology Experience Centre facilitates customised communication requirements for small, medium and large enterprises

Sri Lanka Telecom

150+ Years spent serving its customers the rapid uptake of smart phones, mobile broadband and tablet devices. Meanwhile, from a fixed perspective, we are gearing heavily towards providing the best possible high speed broadband and IPTV services to our customers.” As it stands at present, broadband penetration within Sri Lanka falls under seven percent, yet SLT expects this to increase dramatically over the next five years. One of the challenges that it must face head on, is how to service this demand in a cost effective manner. “Household and per capita income in Sri Lanka is much lower than that of other developing nations, and therefore delivering services in an affordable way is a challenge we take very seriously,” Young concludes. “While we already boast voice call rates that are among the lowest in the world, we recognise the importance of being able to re-engineer our networks in order to provide quality fixed and mobile broadband to our customers. That is exactly where we are making great strides and will continue to do so.” For more information about Sri Lanka Telecom visit: www.slt.lk

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Spanco: Respondez


the call Through the work of its Respondez brand, Spanco Limited has introduced its outsourcing solutions to Africa’s thriving telecommunications sector written by: Will Daynes research by: Richard Halfhide

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Respondez provides high value, cost effective contact centre outsourcing solutions

Spanco: Respondez


hough still in its relatively early its expertise into the dynamic space of stages of development, Africa’s international contact centre management telecommunications market and BPO, thus the Respondez brand was is lauded as being one of the created. fastest-growing in the world. Combining its voice, live web chat and Throughout the 2000s, mobile telephony email capabilities with the expertise of across the continent, particularly in sub- its back office support staff, Respondez is Saharan nations, skyrocketed to the able to provide customer care, sales and point where today it is substantially more technical support services to improve user widespread than its fixed line equivalent. satisfaction and deliver increased sales, while As is the case for many leading businesses, at the same time reducing operational costs. Respondez has reacted to the rapid growth Committed to migrating and managing its of Africa’s telecoms sector by expanding client’s business processes effectively, the its presence in the region, partnering with company’s presence extends to a variety of some of leading players industries including retail and e-commerce, financial within the field. services, communications Established in 2002, and entertainment and Respondez prov ides high value, cost effective gaming publishers. contact centre outsourcing Respondez’s solutions through its own communications clients Number of worldwide employees multi-ling ual contact represent leading global headquarters. With its providers of satellite and solutions present in core digital cable, wireless, global epicentres including the US, UK and dial-up, digital subscriber line and cable India, Respondez acts as the global contact internet access, and cellular service and centre and international business processing equipment sales. These clients rely upon it brand of Spanco Limited. to support their existing customers, while Since its formation in 1995, Spanco has also cross-selling portfolios to deliver higher grown into one of the leading telecom revenue and attach rates per customer. systems integration and IT service It was in November 2010 that Spanco companies. Employing more than 7000 officially announced that it had put in place people across the world, Spanco is an a comprehensive strategy to tap into the active player in the field of information BPO opportunities present within Africa. and communication technology (ICT), Central to this plan was the leveraging of with dedicated system integration and its segment specific expertise and its deep business process outsourcing (BPO) arms. talent pool of English and French speaking In 2002, the company decided to leverage employees in order to provide high quality


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Spanco: Respondez services to potential African clients. Between 2011 and 2014, Spanco plans to invest around $20 million to create an infrastructure that will cater for the employment of approximately 10,000 people across the continent. Arguably one of the more exciting developments to occur within Spanco’s short history within Africa was the decision taken by Bharti Airtel, India’s leading mobile phone firm, to award call centre contracts for its African operations. The second significant step in replicating Bharti Airtel’s hugely successful

outsourcing model on the continent, the five-year contract is estimated to be worth around $500 million, with Spanco due to earn a significant percentage of this. The contract to provide customer services was the first of its kind to be introduced to Africa where the back-office processing industry is seen to be in the early stages of evolution. Under the agreement, Bharti Airtel, which owns and operates the Zain brand in 16 African countries, will outsource core customer service functions such as

MaaS: A coherent IT strategy for increased customer experience In the current economic world of costoptimisation, organisations face the pressure to implement efficient and effective ways to manage complex delocalised IT environments where 50-60% of workforce have gone mobile and remote offices gets created all over Africa. Connectivity has so far remained a challenge with most of IT costs going into breakfixes and IMACs. It is imperative that CIOs focus on a best practice governance model combining the technology, the people and the processes to cater for asset management, license metering, availability and capacity management, change management, helpdesk services and SLA compliances.

The IT Management as a Service (MaaS) philosophy leverages on shared-tenancy model technologies coupled with on-site shared personnel to bring a completely new business model to organisations allowing them to optimise cost while benefitting from a knowledge base of skills, thus ensuring a faster resolution time and higher adherence to SLAs resulting in an increased customer experience for the end user. Additionally, providing visibility at all times to organisations on their current IT infrastructure and systems performance in real-time (or near real-time) has become of paramount importance to management. www.mara-ison.com

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Spanco: Respondez

Customer service staff are multi-lingual

call centres and back office operations experiences of working with international as it prepares for the inevitable organisations in the communications sector. acceleration in growth throughout the It is thought by many industry experts region. Currently boasting more than and insiders that the widespread adoption 40 million customers across its African of the BPO model by Bharti Airtel across its operations, Bharti Airtel operations will also bring is looking to increase this tangible benefits to the development of the sector figure to 100 million by 2013. Bharti Airtel’s decision in each country by creating to work with partners like additional job opportunities Spanco, IBM and Tech and developing local talent. Mahindra will enable All three partners are also its mobile customers to committed to providing the necessary services enjoy world class customer Value of Bharti Airtel’s services, while said partners and infrastructure in each contract with Spanco and introduce best practices market that will build its partners and sustain the skills, based on their own unique

$500 million

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“Spanco anticipates its African employee headcount to increase from 2700 to 5000 during the course of the next 12-to-18 months� capabilities and resources that are acquired as a result of the contract. Going forward, Spanco plans to utilise this contact centre contract to secure a larger foothold in the market for itself, through its Respondez brand. In the time since the contract was announced the

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company has entered into talks with at least three other large telecommunications businesses with the aim of providing similar services. Should its plans for the market come to fruition, Spanco anticipates its African employee headcount to increase from its current stated commitment of 2700

Spanco: Respondez

Spanco plans to invest around $20 million in infrastructure

professionals, as part of its agreement with Bharti Airtel, to 5000 during the course of the next 12-to-18 months. Due to the company seeing Africa as a huge untapped market for BPO work, including customer lifecycle management for telecommunication customers, and collections and credit counselling services for banking clients, Spanco continues to seek out potential employees that it can hire to serve other clients that it signs up with in the months to come. The significant roles that the development of the telecommunications industry and the work of businesses like

Respondez have had when it comes to the success of one of Africa’s more thriving sectors cannot be underplayed. For Respondez alone, the last 4000 employees that it has taken on are based on the continent. Statistics like this reinforce the belief that Africa’s presence on the global telecommunications stage will only go from strength to strength. For more information about Spanco: Respondez visit: www.spancobpo.com www.respondez.com

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ON the road to growth 212 | BE emea

Kenya Vehicle Manufacturers (KVM)

Joseph Otieno, acting managing director, discusses how KVM, and Kenya as a whole, is attracting the interest of some of the planet’s most recognisable players in the automotive industry written by: Will Daynes research by: Abi Abagun BE emea | 213

Kenya Vehicle Manufacturers (KVM)


hat the average behalf of its customers. “As a direct result individual knows about of our investment in infrastructure,” acting present day Kenya most managing director, Joseph Otieno explains, likely extends only to its “we currently have the capacity to produce natural wonders, from approximately 6600 vehicles per annum Lake Victoria, the world’s second largest working single shifts.” fresh-water lake, to the open plains of the Operating in the five key sectors of Maasai Mara. What will be less well-known vehicle assembly, bus body building, special is that, in and around its largest cities, Kenya vehicle operations, fabrication and surface is fast becoming an area of great interest branding, KVM also actively engages in the for some of the world’s biggest vehicle sale of mega tents. The primary markets manufacturers. for the vehicles that depart the company’s Incorporated in July 1974, at first under factory are located across East Africa the name Leyland Kenya Limited, the and include countries such as Tanzania, Burundi, Uganda, Zambia company adopted its current moniker in 1989. Production and of course Kenya itself. By abiding by its guiding for the company began in 1976, with the first vehicle principles of quality through rolling off its assembly sta nda rds, customer and supplier intimacy, line in August of that year. Per annum vehicle teamwork and individual Originally designed to production capacity employee participation, produce light and heavy working single shifts commercia l vehicles environmental management including Land Rovers, a nd uncompromised Range Rovers, Volkswagen Microbuses and integrity, KVM is constantly striving to Leyland trucks and buses, the model range be the benchmark vehicle build and mass produced by KVM now numbers 11 and fabricator in the region. includes Nissan Series, Land Rover, Foton “Ever since it became the first vehicle and Hyundai models. assembly plant to be incorporated in Kenya,” KVM is today owned by three major Otieno continues, “KVM has always made stakeholders, those being the Kenyan it a priority of the highest order to invest Government, which owns 35 percent, in itself through the updating of its factory CMC Holdings Limited and D.T. Dobie with world-class equipment, through the and Company, which own 32.5 percent employment and retention of technically respectively. From its plant in Thika, which gifted staff and by obtaining all of the covers an area of 40 acres, 18 of which has necessary operational quality certificates, been earmarked for further development, including ISO:9001-2008.” KVM undertakes contract assembly on In recent years KVM has also become


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Kenya Vehicle Manufacturers (KVM) one of East Africa’s preferred producers of high quality buses. From its bus body building facility the company constructs minibuses, and medium and large buses with on board capacity ranging from 29 to 67 seats. Building according to specifications that conform to individual customer requirements, the company has successfully standardised its body frame works by building them off jig. Bus production facilities at the company’s plant are laid out in a flow line, with the actual body building being carried out on a

trolley. This layout allows the bodies to be built in advance and temporarily stored away before being attached to the vehicles’ chassis. Additionally, KVM has introduced a number of key features to its production line including the adding of fibre gas windscreens to the front and rear of its 62 to 67 seat buses. Alongside its bus body building capabilities, KVM has also built a reputation for its ability to construct tough, long lasting truck bodies, designed to suit the intended purpose of individual vehicle types. The company is able to provide its customers in this field

Apex Steel Limited Apex Steel Limited is one of Kenya’s largest integrated manufacturers and traders of building and engineering materials. From our headquarters in Nairobi, we conduct business throughout East and central Africa. Our primary focus is and has always been to deliver the best solutions to meet the needs of our clients who range from engineers, plumbers, fabricators and construction companies to hardware shops and home builders. With branches across the country, we are able to support our clients and serve them better and effectively. We have also acquired several agencies to distribute some of the world’s unique and number one product brands eg, Graco, Zinga and Bosch just to mention but a few.

2004 marked the birth of our rolling mill division, which manufactures reinforcement bars to BS4449:2005 grade 500. We are also proud to say we are the first steel manufacturer to earn the diamond mark of quality from KEBS, keeping in line with our vision. In October 2010, our light structural mill was commissioned producing angles, flats and window sections to support our engineering clients with quality products. 2012 marks the commissioning of three more lines related to tube manufacturing. Our story has just begun. E. info@apex-steel.com www.apex-steel.com

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with trucks that possess completely covered exterior bodies, back bodies with open spaces or with side doors. One of the more exciting on-going developments involving KVM, and other vehicle manufacturers throughout the region, is the growing interest from Chinese vehicle manufacturers. At present, KVM collaborates with the Chinese company Foton Motors, assembling its Foton Sup V Double Cab and Foton Sup V Single Cab pick-up models. Although its operations in Kenya are little

more than a year old, the success Foton has already had through its partnership with KVM means that it already targeting sales of more than 5000 of its trucks across the regional market over the next two years. It is announcements like this that have further drawn the attention of other large players in the sector. “Following in the footsteps of our work with Foton,” Otieno states, “we have received a number of enquiries from other Chinese motor vehicle firms that are interested in the possibility of having their models assembled

“In recent years KVM has become one of East Africa’s preferred producers of high quality buses”

KVM undertakes contract assembly on behalf of major auto manufacturers

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Kenya Vehicle Manufacturers (KVM)

KVM constructs buses with on board capacity ranging from 29 to 67 seats

here in Thika. We are seeing such interest building as more Chinese businesses are now looking to acquire manufacturing capabilities in Africa.” Kenya in particular is a very strategically beneficial place for these businesses to be as it is able to provide the means to penetrate the East Africa market, which many view as a strong area of future growth. KVM’s presence within a country that is rapidly growing into a regional hub for automobile manufacturing is enough in itself to give it optimism for the future. Otieno, however, knows there is a lot more the company can do to capitalise on this.

“The sheer number of opportunities, as it relates to vehicle assembly, that are arising in this part of the world means that we foresee our assembly operations increasing quite dramatically. What we need to do meanwhile is continue to invest in our equipment, our processes and our people. By doing so we will be able to maintain and even improve on the quality levels that we have spent nearly 40 years being known for.” For more information about Kenya Vehicle Manufacturers visit: www.kvm.co.ke

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The optimum dryer Covering the full spectrum of industry, from mining through chemical to food


stablished in 1983, Drytech International is a dynamic company dedicated to specialising in hightech engineering for the drying and processing industries. This philosophy extends from laboratory and pilot plant facilities, turnkey installation and, ultimately, to developing the optimum drying conditions for client applications. Drytech International’s extensive in-house technology base covers the full spectrum of industry, from mining through chemical to food. Our product range consists of spray drying, rotary, flash, conveyor / tunnel, cabinet, freeze and all configurations of fluid bed dryers. The secret of Drytech International’s success lies in the concept and design of its range of equipment. Drytech International has successfully developed numerous

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complex processes based on existing technology, and has created many innovative design concepts. Drytech International is unique in the industry in that it is not dedicated to any particular type of equipment or process, so is not restricted in its approach to these challenges. Drytech International’s reputation as a company providing well engineered, ruggedly constructed systems, capable of excellent performance, has grown both in the African and international business environment. Although each system varies according to client specifications, state-of-the-art technology has made the Drytech International’s range the preferred choice for drying, calcining, cooling & similar thermal processing requirements around the world. Drytech International has become an internationally recognised

Drytech International

partner due to its ability to focus on the development, engineering, construction and commission of turnkey installations. The company also provides sound and innovative consulting services with technical advice on all areas relating to process and plant / upgrading of existing plant to higher efficiencies / supply of equipment / full turnkey project / supervision of erection / commissioning / process development. The final objective is to create the perfect balance between price, specification and performance. This includes criteria such as availability,

wear, optimising maintenance, operator interaction, and fuel efficiency. Cost-effective, flexible, reliable, customised solutions are what you can expect when Drytech International becomes your thermal processing partner!

Drytech International 50 Mimetes Road, Denver, Johannesburg T +27 11 622 2773 F +27 11 615 1801 E info@drytech.co.za www.drytech.co.za

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innovative magnetic solutions IMT designs, manufactures and markets innovative magnetic equipment for industrial markets worldwide


he IMT team is committed to providing industry with custom manufactured magnetic equipment that meets and exceeds our client’s expectations in performance and ease of use. IMT’s custom designed systems are manufactured to reduce installation time and costs. IMT provides on-site consultation to provide the most beneficial solution to your magnetic equipment requirements and also offers industrial facilities project management, downtime, cost analysis and turn-key installation. State of the art magnetic manufacturing equipment ensures the quality standards of our magnetic products. In addition, our computer aided core designs provide the most efficient and strongest magnetic cores for your application. Mining Mining requires separation equipment to extract tramp metal before crushers,

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pulverizers, grinding circuits and other sizing equipment. In addition to protecting this equipment IMT’s magnetic separation is used to reduce wear on impeller pumps and other conveying components. Other IMT magnetic products include magnetic conveying, magnetic fasteners and temporary patching solutions. Biomass, co-gen and recycling The bio mass, co-gen and recycling industries use many forms of separation. IMT’s permanent magnetic equipment provides years of dependable and effective solutions to these evolving industries. IMT’s equipment protects grinders, hogs, chippers, presses and pelletizers from the damaging effects of tramp metal contamination while providing a metal free product. Wood processing and pulp and paper Wood processing includes sawmills, OSB, chipping and hogging facilities,

Innovative Magnetic Technologies

plywood and remanufacturing plants. IMT’s magnetic separation solutions are being utilized extensively by these industry segments to protect and increase life of presses, grinders and chipping equipment from tramp metal contamination. Bulk handling Bulk handling and ship loading facilities often require IMT’s magnetic separation equipment to purify product before shipment to customers. Materials such as grains, wood chips, coal and other bulk materials are susceptible to metal contamination from the conveying and handling process. IMT’s separation systems offer cost

effective and efficient solutions to these challenges. IMT will introduce some exciting magnetic innovations in the near future. As the developers of five internationally registered patents, we offer industry the next generation of patching, fastening and separation technology.

Innovative Magnetic Technologies #1 - 3308 Appaloosa Rd Kelowna, BC V1V 2W5 Canada T (250) 491-5806 www.imt-inc.com

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All about oil SCOP shows how complex engineering projects can be delivered in a challenging environment through innovative contracting and creative partnership models written by: John O’Hanlon research by: Jon Bradley

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State Company for Oil Projects (Iraq)

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Iraq is planning to double its refinery capacity by 2017

State Company for Oil Projects (Iraq)


hatever the truth about and export targets. According to the World the conflict in Iraq Bank an additional $1 billion per year would being driven by the need to be invested just to maintain current US’ desire to secure its production. Long-term reconstruction costs interest in the country’s in Iraq could reach $100 billion or higher, of oil reserves, in the era following the which more than a third will go to the oil, overthrow of Saddam Hussein in 2003 its gas and electricity sectors. Another challenge story without doubt has been ‘all about oil’. to Iraq’s development of the oil sector is Though the data are still unreliable (official that resources are not evenly divided across statistics have not been revised since 2001 sectarian lines. Most known resources are in and are largely based on two dimensional the Shia areas of the south and the Kurdish seismic data dating back to the 1970s), north, with few resources in control of the the current government thinks that Iraq’s Sunni population in the centre. oil reserves are the largest in the world, International investment is therefore amounting to upward of crucial to boost the Iraqi economy. At present there 350 billion barrels. Even the are three major Iraqi oil independently confirmed refineries, the Baijia and levels of 143 billion barrels put Iraq at third place in the Doura refineries in Baghdad world league. and one at Basra in the south. This is a country that The total capacity of these has maintained itself on oil refineries is approximately Barrels of oil reserves 720,000 barrels per day throughout its unfortunate estimated by Iraqi (bpd); however, at present recent history. Through government two Gulf wars and its illthey are all working at below advised invasion of Kuwait their capacity, producing and a long period of sanctions that led up something in the region of 500,000 bpd. Iraq is now planning to double its refinery to the invasion of 2003, oil has accounted for something in the region of 95 percent capacity by 2017 and a vast number of oilfield of its foreign exchange earnings. Even now service, development and extraction projects nobody seems certain how much oil and gas need to be put out to tender. This is the job of remains to be discovered. the State Company for Oil Projects (SCOP), Following its virtual destruction, Iraq’s which as an entity within the Ministry of Oil oil infrastructure needs to be modernised, implements petroleum and gas projects. The and that will take a great deal of investment. company employs international methods A large reconstruction programme and standards in preparing basic and notwithstanding, the Iraqi oil industry has detailed designs, materials and machinery not been able to meet oil and gas production supply, site project execution, testing and



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“Our Customers Power Partner to Success”

NKA are specialist suppliers of engineering equipment to the Oil and Gas industry.

Our capabilities include: • Trucks and Machinery • Power Generators • Pumps • Vales • Drilling

NKA Engineering Cyprus Ltd.

11 Ag.Georgiou ST. Engomi, 2411 Nicosia, Cyprus T: 00357-22875790 E: awadalla@cytanet.com.cy

State Company for Oil Projects (Iraq)

nka engineering cyprus ltd. NKA Engineering Cyprus Ltd specialises in supplying engineering equipment for the oil and gas industry such as heavy machinery, earth moving vehicles, pumps, valves, and pipes. NKA was one of the first companies to cooperate with and contract for the Iraqi Oil Ministry companies (the State Company for Oil Projects; the Oil Exploration Company; the Oil Pipelines Company; and the South Oil Company). NKA assures the highest technical specifications of its products, competitive prices, on-time delivery, installation and training for engineering staff, genuine spare parts from original manufacturers. This is to ensure our customers’ satisfaction and to achieve our goal of being ‘Our Customers’ Power Partner to Success’. NKA has successfully introduced and marketed products of leading European and American companies in the world, working with them to provide the best service for our clients. These companies include: Michael Byrne Manufacturing; URACA; SPM Weir; FFG Flensburg; MKGExport; Reed Hycalog Middle East; FG Wilson; Cummins; and ITP Group. We supply pumps (filling pumps, hydrostatic pumps and high pressure test pumps); valves (relief valves, check valves, plug valves, swivel joints, steel hose loops and pipe, hummer unions, manifolds

and butterfly valves); drilling machines (horizontal drilling boring machines and horizontal directional drilling machines); trucks and machinery (lorries with cranes, low loaders, dumpers, vacuum and jetting vehicles, service vehicles and mobile workshops); generators; other oil and gas equipment (wellhead control systems, gas dehydration packages, oil and gas filtration and separation systems, and heaters and exchangers). Our projects in the Republic of Iraq have included with SCOP: lorry with crane, FG Wilson generators, URACA triplex test pumps, agriculture tractors, and MKG tippers; with OPC/SCOP: FFG slit emptying tanker, and MKG lorry with crane; with SOC: Cummins generators, mobile workshop, SPM flang and Ckisan pipe, Reed Hycalog drilling bits, FFG vacuum vehicle (VACHAVL), and ITP well head test separators. E. awadalla@cytanet.com.cy

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We have your solution on land and sea

Drilling, Production and Construction Equipment Exporter Phone: +1-281-821-3737 | Fax: +1-281-821-3758 | www.tradequipsm.com

Weekly Because a month is a long time to wait... Your weekly digest of business news and views www.bus-ex.com

State Company for Oil Projects (Iraq) engineering inspection Tradequip Services and Marine, Inc for pipelines and tanks Tradequip Services and Marine, Inc. is a worldwide exporter and welding works, to of drilling, production, and construction equipment ensure performa nce supporting our clients’ oil and gas activity. TSM works of projects during closely with clients to help specify, procure, and deliver commissioning and test-run. the highest quality equipment and components quickly to Each project has its prevent operational downtime. Our worldwide locations allow us to work closely with own budget and SCOP OEMs stationed around the globe to inspect, package, and works with its approved coordinate delivery. contractors to specify a www.tradequipsm.com schedule for completion. It also prepares basic designs for each project, inviting tenders whether for the whole job or in parts. Once proposals have been approved, SCOP moves on to detailed design, including preparation of bills of materials, equipment requirements, tender documents, contracts, and moves on to oversee the execution of the project right up to the hand-over point. One of the biggest projects coming up is the new refinery to be built at Kirkuk, in Kurdish northeast Iraq. The Kirkuk oilfield discovered in the 1920s is the hub of northern Iraqi oil production. SCOP will be offering the construction of the Kirkuk oil refinery to international companies on a build, operate and own (BOO) basis in December 2012. Under a BOO contract, a private company is granted the right to develop, finance, design, build, own, operate, and maintain a project. The Iraqi oil industry has not been able to meet oil The private sector partner owns the project and gas production and export targets

“One of the biggest projects coming up is the new refinery to be built at Kirkuk, in Kurdish northeast Iraq” BE emea | 231

ENGINEERS & CONTRACTORS   FOR THE IRAQI OIL & GAS DEVELOPMENT SINCE 1980  Progetti  Europa &  Global is an Engineering  &  Contracting  Company, that operates on behalf of  Private and Public Companies in the  design  and  implementation  of  Oil  &  Gas  Plants  and  Infra‐ structures since 1970, both in Italy and abroad.    PEG is active in the field of Oil & Gas facilities, petrochemical and energy production plants, for  EPC contracts.      The  experience  acquired  during  more  than  thirty  years  working  for  the  Ministry  of  Oil  (MOO)  in  Iraq , has allowed  PEG  to participate, supporting IOC in the ongoing Rehabilitation and Develop‐ ment Programs for the Oil Fields in South Iraq .        MAIN AREAS OF SPECIALIZATION    ● Process Units for upstream plants   ● Utilities & Offsite Facilities ● Liquid metering and filtering stations ● Oil & Gas Transportation Facilities    (pumping, metering and valves stations, etc.) ● Pre‐assembled modularized units     (skid mounted)   SKILLS       ● EP & EPC contracts  ● Pre – investments studies ● Basic design and Front End Engineering design  (FEED)  ● Detailed Engineering design   ● Procurement services ● Project management ● Construction  ● Commissioning & Start ‐ up  Phone + 3 9 0 6 . 8 8 . 1 7 . 4 1 global@progettieuropa.it www.progettieuropa.it

State Company for Oil Projects (Iraq)

Iraq plans to build four refineries across the country to meet increasing domestic demand

outright and retains the operating revenue more than 150,000 barrels per day of oil.” risk and all of the surplus operating revenue Companies from the US, China, Korea, in perpetuity – this is an increasingly Saudi Arabia and the UAE have expressed popular way for governments to fast track their interest in bidding for the project and major infrastructure projects since it shifts construction is expected to be completed by the risk to the contractor, in exchange for the end of 2016, he said. The Kirkuk refinery project is part of the very considerable upside potential. As Salar Ameen, deputy chairman of oil ministry’s plan to build four refineries Iraq’s National Investment across the country to meet Commission (NIC) has increasing domestic demand. commented: “Feasibility These refineries, located studies are ongoing with in Maissan, Karbala, and two Italian and American Nassiriyah as well as Kirkuk advisers. The Iraqi oil will have a total capacity ministry will make public of 740,000 bpd of oil at an the specifications before the estimated cost of $20 billion end of the year. The refinery and are being planned purely Value of refineries will cost approximately $6 to satisfy domestic demand. planned across Iraq billion with a capacity of However as Dr Ali Hussain,



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one of the Middle East’s most respected independent oil consultants has commented: “There is a need to build a further refinery with the sole purpose of exporting oil products. This would need to be a large facility with a capacity of at least 500 million barrels, and if located in Basra near the Gulf, the refinery would be in a prime location to export its products.” The opportunities for overseas engineering firms and O&G equipment suppliers used to working within large EPC projects are manifold, and among the international firms which have already secured contracts or expressed interest are Foster Wheeler, the Shaw Group, Technip, Saipem, KBR and Penspen. As an example, in August 2012 the UK oil and gas engineering group Penspen signed an agreement with Siemens to provide engineering and procurement services for a new simple cycle power plant in Southern Iraq. Siemens had agreed a base scope with SCOP to work on the engineering and supply of the power plant and had in turn contracted Penspen to provide engineering and procurement services for the balance of plant. Under the terms of the agreement, Siemens is to provide the engineering and supply of the power island on the Al Fao peninsula, and Penspen will provide the remaining engineering and supply of the balance of plant (BOP) equipment/materials.

SCOP will offer contracts

Work began in August and is expected to go on until 5 October 2013. There is also potential for a further additional scope of works to be agreed. Senior project manager Eduard Ilie said that this would be an important project as it would provide a solid basis for the further development of the company’s presence in Iraq and throughout the Gulf Region. While SCOP and its energetic directorgeneral Ms Nihad Ahmad Moosa will be fully stretched to deliver such ambitious refinery

“There is a need to build a further refinery with the sole purpose of exporting oil products” 234 | BE emea

State Company for Oil Projects (Iraq)

s for the Kirkuk oil refinery to international companies on a build, operate and own (BOO) basis in December 2012

targets, SCOP has the advantage of having formed excellent working relationships with its multinational partners. The global engineering and construction company and power equipment supplier Foster Wheeler has worked closely with SCOP to develop strategically important projects like its ongoing FEED (front end engineering and design) contract for the new 300,000 barrels per stream day (bpsd) grassroots refinery at Nassiriya. The proposed world-scale refinery is being designed to be capable of processing 300,000 bpsd of indigenous crude oil to produce LPG, regular, premium and super grade gasoline, aviation turbine kerosene, kerosene, light gas oil, heavy diesel oil, fuel oil and asphalt, all meeting international product quality specifications.

SCOP has another key objective beyond simply getting the infrastructure built – it wants to acquire world class designs and practices. Accordingly Foster Wheeler is helping to train 35 Iraqi nationals in stateof-the-art study and FEED projects. In February this year the contractor provided in-depth training in successful feasibility studies to a group of five chemical engineers from SCOP, South Refineries Company and the Iraqi Ministry of Oil – merely a first step in a much larger technology transfer programme, claims the company. For more information about State Company for Oil Projects (Iraq) visit: www.scop.gov.iq

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Progetti Europa & Global (PEG)

Founder and president Paolo Trocca talks about how Progetti made a name for itself in the Middle Eastern oil business by playing it straight written by: Alan Swaby research by: Jon Bradley

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here is an oil and gas industry in days, almost all the work done for the oil and Italy – but not much of one. In gas sectors involves the engineering, supply 2008, the BP Statistical Energy and commissioning of specific modules and Survey estimated oil production in some cases their installation as well. there at an average of 121,000 “When units such as sulphur recovery barrels of crude oil per day or 0.15 percent units, ammine plants, etc, are included in the of the world’s total. scope of work we do not create something On the other hand, though, Italian new,” says Trocca. “In these cases we can engineering companies do have a real buy the basic design from the holders of the presence in the oil and gas world, where the technological intellectual property and build six legged dog logo of ENI is particularly the equipment according to the plans we well known throughout Northern Africa receive. Having said that, on our metering and even as far afield as the systems, although we do use US and China. On a more proprietary components, modest level is Progetti we have developed our Europa & Global (PEG), a own exclusive software which controls how these Rome based, family owned engineering company components work.” that has been doing R ather tha n new business in the Middle technology, what PEG does East and Northern Africa like to offer is old fashioned Contract to build a new for 40 years. professiona lism. “We pumping station at Al like to remain absolutely “There are two distinct Habaneya straight and always work sides to our company,” says founder and president Paolo to the highest standards,” Trocca. “We do a lot of front end engineering says Trocca, “doing our best to meet the design and PMC (project management agreed delivery dates.” consultancy) for infrastructure projects Another official pat on the back occurred but the majority of the time we are involved at the start of the year when PEG was with engineering and supply of GOSP (gas awarded the first EPC project issued by oil separation plants) for the upstream oil SCOP (State Company for Oil Projects) in and gas process.” Iraq, since the 2003 war. The €72 million PEG’s first contribution to the oil business contract to build a new pumping station at was concerned with providing engineering Al Habaneya, not far to the west of Baghdad services, but when many years ago it was is also at the upper end of projects ever asked to design and build a complete oil tackled by PEG and due to be completed by metering package, the company took the the end of February 2014. opportunity and never looked back. These Interestingly, PEG has opted to take on



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Progetti Europa & Global (PEG)

Site survey during construction works

180 km Super-highway between the Tunisia/ Libya border and Egypt

Crude oil stripping column

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work involving fabrication without its own manufacturing facilities. In Trocca’s eyes, this gives the company the maximum operational flexibility possible while at the same time removing the need to made heavy investments in plant and equipment and the responsibility of keeping a factory fully occupied. “We do like to subcontract fabrication to Italian companies,” he says, “but we don’t have any regular arrangements with particular businesses and in any case, fabrication in Italy is not always possible or practical. Sometimes, clients want to increase the local content of a contract and then we find suitable fabricators closer to the project site. At other times, the cost of transporting especially large modules outweighs the value of the equipment, so again it makes sense to manufacture near the site. This business model gives us great agility but it does place considerable responsibility on our inspection teams to make sure that things are done as they should be.” Coming back to the different types of activities PEG runs, it’s not easy to compare the contribution to the company from the two sides of the business. Certainly, the oil and gas sector brings in the majority of revenue earned as it contains a considerable

Progetti Europa & Global (PEG)

Dehydration and desalting unit

element of materials and capital equipment, while the management and engineering services purely reflect manpower used. The latter is useful, however, as it provides Italian based income, but as expenditure on infrastructure has been hit by austerity measures there, looking outward is much more rewarding. Trocca is anticipating the time when three members of his family who are in their forties, will take over full control of how the business is run. “We know,” he says, “that to lift our company from the €40 million bracket, where we are at the moment, to an €80 million level, we shall have to broaden our horizons both geographically and in the scope of work we handle.” No doubt PEG will be hoping for more contracts like the recently announced super-highway between the Tunisia/Libya border and Egypt – an 1800km three lane road across the top of North Africa for which

Progetti as part of an Italian consortium has won the PMC contract. The company has already identified gas treatment as a growth sector as nuclear energy is scaled back and replaced by gas powered power plants. Trocca envisages that the same professionalism that built PEG’s reputation with state and private oil companies will serve it well in taking on tier 2 projects for key modules of the plant involved with gas production. “Thirty years ago, it was the relatively modest work we were doing on oil metering systems that got the business recognised and opened the door to bigger things and we will be working towards the same scenario again in the coming decades.” For more information about Progetti Europa & Global (PEG) visit: www.progettieuropa.it

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SouthGobi Resources

oal for China

Mongolia has a wealth of coal and a booming mining sector. It’s also conveniently located on China’s doorstep written by: John O’Hanlon research by: Jon Bradley

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Mongolia has a booming mining sector

SouthGobi Resources


nyone writing about Mongolia and its resources these days has to try to avoid hyperbole. It’s far too easy to join the frenzy surrounding ‘Minegolia’, but the importance of this rapidly growing and strategically positioned region shouldn’t be understated either. Mongolia’s economy grew faster than any other in the world last year, with GDP growth of 17.3 percent, twice as fast as China’s. Admittedly this growth has come from a low base, in a country mainly populated by herdsmen and whose main foreign exchange earner has been until now the cashmere industry: per capita GDP is still well short of $5,000. All this growth is being driven by Mongolia’s booming mining sector and its large reserves of metallurgical or coking coal. Mongolia has not only enough coal to fuel China’s needs for the next 50 years, but also vast quantities of copper, gold, uranium and other minerals. Met coal has been in strong demand from China since it ceased to be a net exporter in 2005, and its demand for lower grade thermal coal is insatiable. Mongolia has profited from selling coal, copper and other minerals to China’s booming economy, but some Mongolians have been uneasy about possible economic domination by their giant neighbour – the political situation remains sensitive, to put it mildly. SouthGobi Resources owns four significant coal projects in Mongolia, its flagship Ovoot Tolgoi mine, in production since 2008, and three development projects, the Soumber Deposit, Zag Suuj Deposit and the Ovoot Tolgoi Underground Deposit:

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Your imagination our cr

For over 40 years, KAMAZ has been designing, developing and over the years, together with ongoing investment in research application. It is this expertise and the search for added value

KAMAZ heavy duty trucks have unique combination of innovat exceptional flexibility and variability which makes it the ideal t vehicle concepts for greater efficiency and economy.

(976)99105170 cell | (976)70175170 work | (976)70171797 fax


d producing heavy duty trucks for all industries. The expertise acquired h and development, have made KAMAZ a leading company in this field of e for our customers that make us different and reliable.

tion and reliability, comfort and driving dynamics. But, above all, it’s the truck for every task. For each product segment KAMAZ offers tailored

| matka@mongol.net “Batseer” LLC Official Distributor of Kamaz in Mongolia


BATSEER LLC For over 40 years, KAMAZ has been designing, developing and producing heavy duty trucks (over 40 models, more than 1,500 kits, left-hand drive vehicles), trailers, buses, tractors, engines, power units, and different tools for all industries. KAMAZ ranks 16th among the world’s top heavy truck manufacturers and ranks first in the Russian Federation. Over the last few years, the range of the company’s production has considerably increased. The manufacture of medium tonnage vehicles was mastered, the line-up of high payload vehicles was extended. They have 198 dealers all around the world, including Mongolia. Batseer LLC became the KAMAZ JSC dealer in 1996 and is the only authorized dealer in Mongolia that imports KAMAZ parts and vehicles. Batseer LLC has been successfully working with mining, construction, road construction, tourism, agricultural companies and government agencies. Mining companies, in particular, use heavy duty KAMAZ trucks, weighing up to 120 tons. In 2012, when Russia adopts technical regulations compliant with Euro-4 international standards, KAMAZ vehicles will have engines meeting this environmental standard. The KAMAZ-master team has won the informal world championship 10 times among truck producers, such as in rallies like Paris-Dakar and Lisbon-Dakar. In 2011, OJSC KAMAZ achieved the main tasks to implement its product policy and enhance the consumer appeal of

manufactured vehicles. The company expanded the range of KAMAZ trucks equipped with restyled cabs and improved consumer features; started producing vehicles of the light-duty KAMAZ-5308 line-up; produced pilot batches of Euro 4 KAMAZ vehicles; launched the serial production of KAMAZ engines equipped with common rail systems made by Bosch; ramped up production of 400 hp KAMAZ engines; launched the serial production of oval-type tipping platforms, and equipped all vehicles, except all-wheel drive ones, with tubeless tires and profiled wheels. Batseer LLC offers a wide range of high quality of trucks and trailers to the Mongolian market such as prime movers, mobile cranes, dump trucks, buses, travel trucks, tractors, cement trucks, fire trucks etc. KAMAZ trucks’ advantages are: • Easy-to-maintain and reliable trucks of high quality with low operation costs and at most competitive prices; • Wide marketing geography – KAMAZ vehicles operate under any road and climatic conditions: in the Northern Pole and in tropics, in deserts and high mountains; • KAMAZ offers one year warranty which is 65,000km on the automobile. • Positioning itself in the medium price segment; • Developing integration with Daimler. E. matka@mongol.net

NOVEMBER 2012 | 1

SouthGobi Resources

Local school children

sitting on its doorstep these mines are ideally placed to fuel China’s future demand. In October 2006 Turquoise Hill Resources, the parent company of SouthGobi Resources, announced a strategic partnership with Rio Tinto plc, based in London, England, and Melbourne, Australia, to develop Turquoise Hill Resources’ world-class Oyu Tolgoi copper-gold deposit in

southern Mongolia, 80 kilometres north of the Mongolia-China border. Cameron McRae, Oyu Tolgoi’s CEO, is on record as saying that the project will be the world’s third-largest copper and gold mine. However, SouthGobi itself is focused on exploration and development of its metallurgical and thermal coal deposits in Mongolia’s South Gobi Region, specifically its Ovoot Tolgoi mine.

“Mongolia has enough coal to fuel China’s needs for the next 50 years” BE emea | 249

Heard Tell us about your company and we’ll tell everyone else www.bus-ex.com

SouthGobi Resources Ovoot Tolgoi is the mcs electronics company’s flagship coal mine Founded in 1997, MCS Electronics has today become one development project where of the biggest national IT companies by accounting for 30 open-pit coal production percent of the Mongolian IT market share. Today, MCS started in April 2008 and has Electronics has approximately 300 employees, 60 percent been ramping up ever since, of whom possess an engineering background. Thirty selling its coal to customers percent are engineers certified by Microsoft, Oracle, Dell, Canon, HP, Samsung and Cisco. In addition, we have a very in China. That Mongolia is strong marketing and sales team with 50 highly skilled and the biggest exporter of coal experienced staff to deliver our services to over twenty to China is hardly surprising thousand corporate customers. considering its proximity www.electronics.mcs.mn – the fact is that even faroff Canada is finding it economic to ship metallurgical coal to China via the west coast ports of Prince Rupert and Roberts Bank, but the Ovoot Tolgoi complex is just 20 miles from the border railhead at Ceke. One of only two major Mongolian exporters SouthGobi has 735 million tonnes of inferred and measured coal resources, giving it a mine life of over 25 years – and the company is actively drilling and exploring to extend that resource. Within three years SouthGobi will be exporting ten million tonnes of coking coal. Cash costs of coal production are among the lowest in the world, and as China’s regional modernisation and infrastructure programme continues the prices the company realises for its coal will continue to increase. In 2011 SouthGobi’s average realized selling price Exposed coal seam

“SouthGobi Resources owns four significant coal projects in Mongolia” BE emea | 251

reached $54.03 per tonne, an increase of 56 percent over the previous year. In fact 2011 was an outstanding year for the company. Annual coal sales hit a company high of 4.02 million tonnes – a 58 percent increase from 2010. Annual revenue went up an extraordinary 124 percent to $179 million while gross profit rose 42 percent to $51.7 million. Despite being very close to China, the 40 kilometre road to the Shievee Khuren-Ceke border crossing

needed upgrading so SouthGobi and its Mongolian partner NTB were awarded a contract to build a paved coal-haul highway to transport coal from the Ovoot Tolgoi mine to the Mongolia-China border. “This world class coal-haul highway will provide a safer, more cost effective route to connect with shipment facilities across the border and to our customers in China,” said board chairman Peter Meredith at the time. While variable ash content can be tolerated

“Ovoot Tolgoi is the company’s flagship coal mine development project where open-pit coal production started in April 2008”

CMC washplant

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SouthGobi Resources

Training on simulators

in thermal coal, customers outside the area covered by for met coal require the coal the mining licence, and as reported in March 2012, for their steel making process to be of a more precise increasing the measured and specification to achieve low indicated resources by 124 levels of volatile materials percent to 137 million tonnes and ash. This is achieved by and raising the inferred SouthGobi’s 2011 resources by 26 percent to wet-washing – in July last annual revenue year SouthGobi made a five83 million tonnes of low-toyear deal with Ejin Jinda, a medium volatile bituminous subsidiary of China Mongolia coal. It also issued a maiden Coal Co. Ltd. (CMC), to toll wash its coal resource report in March 2012 for a new at a facility near the border. The resulting deposit, Zag Suuj, some 150 kilometres east product has a consistent low ash content . of Ovoot Tolgoi – all indications are that Zag An important milestone was reached in Suuj will yield a high quality coking coal. July when the company received a mining Recent BBC coverage on Mongolia has licence for its hard coking coal Soumber given its mining industry a bad image where deposit. Subsequent exploration has safety and title are concerned, but SouthGobi’s expanded Soumber’s resources inside and 700-plus employees are more fortunate than



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Construction of the coal-haul highway

SouthGobi Resources those caught up in the unregulated sector. In 2011 they received a total of more than 50,000 hours of safety training. Its effect was a world class level of safety, with a lost time injury (LTI) rate of just 0.8. Ninety seven percent of employees at Ovoot Tolgoi are Mongolian nationals, more than half of them from the districts surrounding the operation, and in this country of herdsmen and nomads there is not much knowledge of mining – a major contributory factor in the poor safety record among artisanal miners. To augment the company’s in-house training programmes it also signed an agreement with a local vocational training school in the regional capital, Dalanzadgad, to provide initial vocational training for employees. SouthGobi is also investing in the future of these communities. A kindergarten for 100 students in the nearby small town of Gurvantes, sponsored by the company, was opened in 2011. Additionally the company continued to provide winter assistance, including the provision of livestock feed for local herders and coal for winter heating in several local communities. More than 20 students received full scholarships from SouthGobi to help them continue their education at Mongolian universities. Upon graduation, they will be granted internships at SouthGobi to begin their professional careers. For more information about SouthGobi Resources visit: www.southgobi.com

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Anyone for coffee? This Kenyan tea and coffee producer has paved the way to growth with diversification into retail and is cutting costs by generating its own electricity written by: Alan Swaby research by: Paul Bradley

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Sasini is one of Kenya’s leading producers of coffee and tea



ust look at the international growth of chains such as Starbucks and it seems that coffee has entered a truly golden era. In the 12 months to September 2011, world coffee exports increased by 9.4 percent to a historical record of 103 million bags – or over 6 million tonnes! Two thirds of this comes from South America, which means that the contribution from Africa in general and Kenya in particular is in the minority. Nevertheless, it must be a worry for the Kenyan economy that while demand is booming, Kenya’s coffee industry is not capitalising to the full extent. For some years now, the trend in production has been heading south. In the period in question, output fell a massive 30 percent to just 19,600 tonnes. At the root of the matter are depressed prices. Last year saw something of an improvement with average prices of US$6.61/kg compared to $3.91/kg for the year before, but add low prices to erratic climatic conditions and the end result is that small growers are abandoning the crop at an alarming rate. Compared to an all-time high of 170,000 hectares under cultivation, the figure now stands at 150,000 ha. Within this overall gloomy picture, though, there is at least one bright spot. Sasini is one of Kenya’s leading producers of coffee and tea. In fact, through a network of subsidiary companies, Sasini has also developed markets in dairy livestock, horticulture and tourism, generating revenues of over KSh2.6 billion. From its headquarters in Nairobi, it controls

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Coffee harvest

“Through a network of subsidiary companies, Sasini has also developed markets in dairy livestock, horticulture and tourism” operations in all parts of the country and is an important contributor to the economy through the 5000 direct and indirect employees it engages. In fact, Sasini is one of the elder ‘statesmen’ of the Kenyan economy and is certainly one of the longest standing companies on the Nairobi stock exchange. The business started in 1952 while Kenya was still a British colony. Queen Elizabeth was actually in Kenya when she learnt she had become queen on the death of her father. From the original one farm, the operation

grew rapidly and by 1960, it had gone public. Currently Sasini is focused on adding value to the various divisions of the business, implementing systems that improve the quality, quantity and value of products for the future. For example, once the coffee beans are harvested they pass through Sasini’s own mill – generally considered to be one of the most modern and productive in the country. In order to create a sustainable business and cut down on energy consumption, Sasini is taking electricity generation into

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Sasini its own hands. Last year, the company successfully Barclays is a major global financial services provider applied for funding from the engaged in retail banking, credit cards, corporate Energy and Environment banking, investment banking and wealth management Partnership Programme with an extensive international presence in Europe, the for the development of Americas, Africa and Asia. With over 300 years of history a micro-hydro power and expertise in banking, Barclays operates in over 50 countries and employs 147,500 people. generation project. It also With a clear focus on quality relationships, Barclays plans to convert the coffee provides integrated banking solutions to businesses, large husks into briquettes that local companies, financial institutions and multinationals. can then be burnt to feed We facilitate the success and growth of our clients by thermal generation. The providing lending, risk management, cash and liquidity programme is funded by management, trade finance and asset and sales financing. the governments of Finland www.barclays.com and Austria through the Development Bank of South Africa and has the primary aim of helping to eradicate poverty through ecologically sustainable development projects. While the West is in love with coffee, the drink of choice in the East is tea. Demand has pushed prices up through the past five economically depressed years and there has been a steady rise in global production that has so far failed to outstrip demand to the point where last year an estimated four billion kilogrammes of tea were produced. The prospects for farmers seem bright. The steady urbanisation of China (in particular) is reducing the amount of land


5,000 Direct and indirect employees of Sasini Sacks of coffee beans

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under cultivation in Asia and opening more opportunities for other countries to take up the slack. Having said that, erratic weather patterns are not helping and overall tea production in Kenya is expected to be down thanks to the lack of rain in the early part of the year. Sasini’s tea operations are conducted through the Kipkebe subsidiary which controls two large tea factories with a combined capacity of 8.5 million kgs of CTC tea annually. Two thirds of this comes

from Sasini’s own farms while the balance is bought from independent growers. Sasini’s tea is grown in estates located west of the Rift Valley, in the Nyanza Province where climatic conditions are at their best. The estates are at an average altitude of 6000m above sea level and fall between the equator and 10° S latitude. Average annual rainfall is in the region of 1600mm, ideally spread over virtually the whole year. Having established the right conditions and infrastructure needed for its agricultural

“Sasini has created a retail division to manage the marketing of its tea and coffee on the local scene”

Two-thirds of Sasini’s tea comes from its own farms

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Coffee beans are processed in Sasini’s own mill

endeavours, Sasini has turned its attention to growth through finished products. Rather than simply providing a commodity product subject to the whims of an international market, it has created a retail division to manage the marketing of its tea and coffee on the local scene. Sasini has made an initial investment of KSh100 million to be spent on value addition. It has developed a range of tea and coffee brands with varying prices with the aim of having something to suit all tastes and budgets. Periodically, new brands are launched to keep the range fresh and in line with market demands. Sasini has even entered the service end of the retail spectrum. It’s no stranger to the hospitality industry as it has an interest in

some of Kenya’s leading tourist destinations. Now it has added and expanded the Savannah Lifestyle coffee lounges to its portfolio with seven outlets strategically located to serve both visitors to some of Nairobi’s attractions and members of the indigenous managerial classes working in some of the city’s most illustrious buildings. Activities such as these are seen by the directors of Sasini as the way for all developing countries to go, to create wealth within their own borders rather than simply exporting raw commodities. For more information about Sasini visit: www.sasini.co.ke

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