Productivity Leader

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ISDN 1018-7227

Official publication of Productivity SA

www.workplacechallenge.co.za Sango Madikizela Tel: 011 848 5305 Email: sangom@productivitysa.co.za

contents

contents

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CEO’s desk

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Ed’s note

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Letters to the editor

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News • Productivity SA appoints CEO • Prospects for South Africa’s Future • Persistence pays at Productivity SA’s Annual Awards

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• Productive capacity-building for the informal sector operators in Africa

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Achieving aligned commitment through employee benefits

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Achieving success through doing it right

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Case studies

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• M-tec • Profibre Products

Productivity SA CEO: Bongani Coka

Project coordination and advertising: Rui Victor Chirindja

Productivity SA Executive Manager: Rebecca Phalatse

Tel: 011 883 4627 • Email: communications@isikhova.co.za

Editor: Maupi Monyemangene Email: maupim@productivitysa.co.za

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Printing and reproduction: Colors

Sub-editor: Chris Whales

All correspondence should be addressed to the Editor,

Contributing writers: Chanique Fonto; Deleen Wilson;

Productivity SA, Reg no 1975/00044/08

Frances Wright; Maupi Monyemangene; Mokgadi Mahlakgane; Peet Dorfling Photography: Productivity SA and Photos.com, a division of Getty Images Productivity SA Physical address: International Business Gateway, Midrand, cnr New Road and Sixth Road Tel: 011 848 5300 • Fax: 011 848 5555 Email: info@productivitysa.co.za Website: www.productivitysa.co.za

All rights reserved. No part of this publication may be produced, adapted, stored in a retreival system or transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without the prior written permission of Productivity SA. The views expressed in this newsletter are not necessarily those of the Publishers or its agents. While every effort has been made to ensure the accuracy of its contents, neither the owners nor the publishers can be held responsible for any omissions, errors, or for any misfortune, injury or damages which may arise therefrom. The same conditions apply to any advertising in the publication.

Publishers: Isikhova Publishing & Communications (Pty) Ltd

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Postal address: PO Box 651793, Benmore 2010 Tel: 011 883 4627 • Website: www.isikhova.co.za Design and layout: Joanne Brook, Isikhova Publishing

ISDN 1018-7227

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CEO’s DESK

CEO’s desk In the second quarter of 2011, the gross domestic product (GDP) showed a decline of 1.3% compared with a 4.5% increase in the first quarter. South Africa’s quarter on quarter growth in Q3 was also 1.3%, mirroring the growth of Q2.

This could be attributed to a host of factors including the eurozone crisis. Indeed these developments put paid to earlier projections that the South African economy would grow by 3.5% during 2011. These latest developments once again highlighted the reality that the task of reducing unemployment in South Africa remains an arduous one.

For Productivity SA, a drop in our GDP means we have to double if not triple our efforts to galvanise South African industry into an enhanced mode of productivity.

For more than 40 years, Productivity SA has helped thousands of companies to improve their productivity and competitiveness by building sound projectmanagement skills, developing working relationships with other governmental agencies, progressing local labour practices, and creating and instilling a range of effective, tailored programmes.

Some of our key programmes include Productivity Organisational Solutions (which helps individuals adopt the right attitude, knowledge and skills to conduct daily productivity improvement); the Workplace Challenge (the dti’s best operating practice and world-class manufacturing programme, which we operate for it); and Value Chain Competitiveness whose primary objective is to conduct thorough research so as to constructively comment on the productivity of priority economic sectors, and to contribute towards national policy direction and debates.

These programmes, together with our engaging support services, training, tools and research, are specifically designed to help companies develop jobs and create wealth, thereby leading to a better general standard of living across all income groups.

Earlier this year, the World Economic Forum (WEF) in Cape Town called on African governments to better harness the region’s resources through stronger integration into international trade and finance, to improve educational systems, to enhance entrepreneurial opportunities for women and to develop their tourism sectors in order to become more competitive. Five key areas that were highlighted included: • Region in need of better integration • Improved educational systems • Expanding women’s opportunities in entrepreneurship • Upgrading and harnessing tourism • National competitiveness councils

The recommendation for ‘National competitiveness councils in order to promote the growth of the continent’ coincided with a recommendation by Value Chain Competitiveness in a study titled ’Establishing a Set of South Africa Specific Competitiveness Indicators’.

In order for South Africa to improve its competiveness on the global stage, there is a need for the country to establish a National Competitiveness Council similar to South Korea’s Presidential Council on National Competitiveness.

A National Competitiveness Council consisting of representatives from government, business, academia and labour would help improve South Africa‘s competitiveness on the global stage. I take this opportunity to thank you for your support throughout the year and wish you well during the festive period. Thank you.

Bongani Coka CEO: Productivity SA

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Ed’s note

Ed’s note Once again the year has come and gone. The year was not without its trials and tribulations, but it seems the tribulations have had more of a jubilant year when one glances at the days gone by from an economic growth and development perspective.

The global woes in terms of the eurozone seem to have put paid to any hopes of an economic revival that would have echoed throughout the continent. Be that as it may, the human spirit is known for its resilience and we continue to stand tall despite the cacophony of challenges.

In this issue of Productivity SA Leader, we round off the year by looking at the National Productivity Awards. The Honourable Minister of Labour, Mildred Oliphant, captured the essence of what the National Productivity Awards are about when she said, ‘The National Productivity Awards aim to act as a supportive tool that assists in spurring on productivity.’

To get more insights into the National Productivity Awards, see page 8 where we give an overview of who can enter the awards and the adjudication criteria.

Our guest writer Frances Wright adds a voice by outlining how doing the simple things rights can lead to success. In her article on page 14, Wright looks at how entrepreneurs contribute towards the economic growth of the country and, even more pertinently, towards job creation.

While on the subject of economic growth, the government, through the National Planning Commission, recently released the National Development Plan aimed at providing a long-term vision and strategic plan for South Africa. Together with the New Growth Path (NGP), the plans have succinctly outlined what is required to spur development and growth in the country.

On page 7 we publish excerpts from a research report released recently by the Development Bank of Southern Africa (DBSA) titled ‘Prospects for South Africa’s Future’, which ‘provides an independent perspective on South Africa’s potential long-term development path, including evidence-based projections and should contribute to the work of key national departments, the National Planning Commission and other role-players’.

On page 12, guest writer Chanique Fonto looks at how an enabling and happy environment within the workplace can lead to satisfied clients and yield higher returns. Productivity SA continues to implement its workplace methodologies

and toolkits within various companies, and to provide a sense of the results brought about by the implementation of Productivity SA programmes, we look at the case studies as outlined on page 16.

The case studies outline how businesses implemented Productivity SA programmes within their companies.

Productivity SA has a host of programmes, but the key programmes implemented within workplaces for enhanced productivity are Turnaround Solutions and the Workplace Challenge. Central to the workings of Turnaround Solutions is the need to mitigate jobs losses by actively providing technical support to struggling enterprises with the aim of stabilising and nursing them back to profitability.

Turnaround Solutions has over the past decade and a half helped save over 200 000 jobs. This figure represents an average rate of at least 16 000 jobs saved annually, including the 2010/11 financial year.

The Workplace Challenge (WPC) aims to catapult participating companies to world competiveness. The WPC is a project of the Department of Trade and Industry (dti) and is project-managed by Productivity SA. Since its inception in 2002, the programme has impacted mostly in companies in the manufacturing and services industries of our economy. The WPC programme is a world-class manufacturing, or best operating practice, programme aimed at helping manufacturing companies in South Africa to become more competitive.

This is achieved through various processes and toolkits that include building worker participation, thereby empowering the workers to upgrade their skills and perform better. In the year under review, the WPC nurtured 141 companies on their journey to world competitiveness. Productivity SA Leader thanks the staff at the WPC, notably Peet Dorfling, for supplying the publication with the case studies.

I am positive you will find the line-up of articles engrossing and Productivity SA Leader takes this opportunity to wish you well during the festive break.

Maupi Monyemangene Editor maupim@productivitysa.co.za

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LETTERS

Letters to the editor Dear Editor Your previous issue released during what was termed Productivity Month ran an article ‘Can social network media increase productivity?’ The article asked how social media can be used to communicate effectively with stakeholders especially within the youth market.

I think the issue of social media is twofold and at times we tend to overrate the impact social media can have within the workplace. For starters the use of social media depends on the nature of the workplace one is operating in.

Social media requires an individual to engage in whatever communication gadget people are using to access the media. If an individual operates within a workplace where there is little or no space to engage in social media such as operations-intense areas like manufacturing, then if anything social media can actually impact negatively on productivity.

I think social media can enhance productivity, however, the impact thereof can be overrated and if anything, social media can simply be a supporting tool similar to what communication does within the workplace. I would think social media can increase productivity but only in areas within related departments and when one looks at overall company operations, that area could be very small.

Regards Puleng Maseko, Midrand

Dear Mr Mbatha and all National Productivity Awards role-players I would like to congratulate you on yet another successful National Productivity Awards event. Please convey a word of thanks to all the judges and role-players who make an event such as the National Productivity SA Awards possible.

To be a finalist and a winner of this award is special and it truly makes a difference to be acknowledged for all the hard work. Productivity SA truly makes a difference as you invest and believe in people. It is clear that all the organisers, judges and role-players work hard to produce these events.

Thank you for making a difference in people’s lives.

The Productivity Awards are such a morale booster. You are the best medicine for any person’s self esteem. This is a

value and characteristic that is appreciated. I am grateful to have had this wonderful experience in 2010. I am sure that all the 2011 finalists and winners feel the same.

Keep up the good work.

Regards Rahima Moosa Mother and Child Hospital Public Sector Winner (2010) Mrs JCW Weyers

Productivity tips Productivity SA would like to share some tips that will help increase productivity in your business.

When you wake up each day, make a conscious decision to have a positive attitude towards everything that comes your way. A positive mindset can move mountains. The productive difference between a motivated person and an unmotivated person can be as much as 60%!

1. Productivity can never be left to chance! Plan your day. Make a list of goals that need to be achieved each day, and tick them off as you complete them.

This will ensure you have a mission, and that you remain focused on completing today’s goals.

Don’t allow yourself to be side-tracked into doing less important things first!

2. Once you have finished planning, make sure that you are prepared for everything. Go through your list and make sure you have all the tools you need to complete your goals first time. Remember, productivity is about doing more with less, so use only what you need!

3. Delegation allows you to concentrate on your important goals for the day and not waste your time on less important tasks. Multiply your productivity by sharing your goals and mission with your team or family!

4. In the workplace, do not waste scarce resources, do not waste water, when your taps leak, fix them and when you leave a room, switch off the lights, switch off the air conditioning.

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Productivity SA appoints CEO Bongani Coka is the new Productivity SA chief executive and is geared to ensure that South Africa leapfrogs into the ‘premier league’ of the world’s competitive nations through improved productivity.

Coka believes the key to the great leap is an improvement in the country’s investment in research and technology. He sees an improvement in the quality of the country’s education system, further upgrades to road and health infrastructure, encouragement and development of entrepreneurs, and dealing with the skills shortage as other key ingredients to the realisation of this objective.

He was appointed as chief executive effective 1 October 2011. This man with a passion about the growth and development of the country is highly aware that a value system and work ethic geared towards that is important.

‘Doing the little things right and getting the fundamentals in line. Basically a believer in the tried and tested norm of hard and smart work yields results,’ he said.

Coka is an accomplished professional with across-theboard proficiency within a number of business sectors ranging from finance, operations, project management, design, execution and control of strategies, stakeholder relations and organisational transformation to leadership and mentoring, among others.

Productivity SA is a statutory body under the stewardship of the Department of Labour. The organisation discharges its responsibilities through longstanding programmes that focus on research, providing information, training and facilitation, advisory services, auditing and monitoring productivity issues.

A man who oozes passion for what he does, Coka said the organisation’s client base comprises primarily business and government institutions. He also said that Productivity SA has done extensive work within various sectors, notably the manufacturing and agricultural sectors.

The institution has three flagship programmes and they operate as follows: • Turnaround Solutions – assists companies in distress and saves jobs; Productivity SA charges 35% of the total cost to the client while the Unemployment Insurance Fund (UIF) covers 65%.

• Workplace Challenge – assists companies to become world class by adopting world-class practices; Productivity SA charges 25% while the remaining 75% is absorbed by funding received from the Department of Trade and Industry.

• SMME Capacity Programme – funded out of the government grant received from the Department of Labour. The grant is also utilised by Productivity SA to fund the productivity-awareness programmes and various productivity-related research and statistics.

According to Coka, Productivity SA interventions are about productivity improvement – which is a measure of the efficiency of production or a ratio of what is produced to what is required to produce it – and the number of companies successfully implementing Productivity SA programmes is indicative of the success thereof.

The organisation was founded over 40 years ago with a mandate to improve productivity in all spheres of the nation’s economic and community life. It is governed by a tripartite council drawn from government, labour and business.

Productivity SA has offices in Midrand, Durban and Cape Town, and a satellite office in Port Elizabeth.

In addition to its mandate, it also plays a role in enhancing South Africa’s commercial productivity and global competitive-

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ness, thus boosting the economy and creating jobs.

Coka was born in 1960 in Ekurhuleni and matriculated at Illinge High School in Vosloorus. He made his debut in the job market when he was hired by Putco Ltd in Boksburg, where he worked as an internal auditor.

He has accounting qualifications including an Honours degree from Unisa, and an Advanced Management Accounting and Tax Diploma from the former Rand Afrikaanse University. He is currently studying towards obtaining an MBA. As a leader, he has long grasped the ethos of taking the initiative and working as a team player. Coka boasts strong character attributes in communication and interpersonal etiquette, being a team player and an assertive planner with high attention to detail, goal-oriented with strong leadership.

Coka previously worked for Transnet between 1994 and 2000 in various positions, including being funding manager, acting financial manager and finance manager. He has also worked for Deloitte & Touche, a leading professional services firm in audit, tax, consulting and financial advisory services, as a trainee accountant between 1989 and 1994.

Between 1987 and 1997, he was also a tutor at the Johannesburg Learning Centre where he tutored undergraduate students for Unisa, accounting for attorneys, auditing and taxation, and also mentored students.

Some of his successes during his stay at Productivity SA include securing new key strategic partnerships with organisations such as the Sheltered Employment Fund, which provides opportunities to train workers with disabilities; the Afrikaanse Handelsinstituut; the KwaZuluNatal Department of Economic Development; the Durban Chamber; Labour Centre KwaZulu-Natal; the South African Chamber of Commerce and Industry; the Association for Skills Development Facilitators in SA and the Department of Science and Technology.

Before becoming the chief executive of Productivity SA, Coka had previously been its chief financial officer since 2000. He is not new to the position, as in 2008 he acted as chief executive, was chairman of the Productivity SA Pension Fund, and also served in the organisation’s various committees and roles.

Some of Productivity SA’s clients are the Japan International Cooperation Agency (JICA), the Tshwane University of Technology, Intersite, the Department of Education, the Sheltered Employment Fund, Energy Seta, Vumo Waste, Soweto LED, Tshwane LED, the South African Women Entrepreneurs’ Network (Sawen), Harmony Mine, Mafikeng Municipality and the Mpumalanga Department of Environment, Economic Development and Tourism.

Past clients include Spoornet, BMW, BankSeta, Kwikot, Valpré, Umzinyathi District Municipality, SANParks, Johannesburg Metro Police Department and the Small Enterprise Development Agency (Seda).

Coka says Productivity SA should pat itself on the back because during the recent economic downturn, ‘the organ-

isation conducted studies on sectors that were shedding the most jobs and intervened at company level and saved over 15 000 jobs’.

Working on a tight budget of around R100-million per financial cycle, Coka sees this budget increasing over time.

‘To tap into the market and unlock South Africa’s potential, the organisation will require extensive funds,’ he said.

Productivity SA’s budget comprises an estimated 45% of funding derived from the Unemployment Insurance Fund to fund companies that are in distress; an estimated 35% via the government grant through the Department of Labour; 10% from the Department of Trade and Industry; while the remaining 10% is self-generated from various sources such as consultation within the identified companies.

Productivity SA‘s current staff complement is 100 and over 70% of the staff members are productivity experts within their field of operation, such as industrial engineers and trainers on productivity competencies. The core competencies of the organisation are augmented by support staff, including a marketing unit that specialises in the promotion of productivity awareness.

Productivity SA aims to expand, but the organisation will initially explore the utilisation of labour centres in provinces where it has no offices.

Since joining the organisation in 2000 as a financial manager, Coka has managed to help Productivity SA post unqualified audits over a period of more than 10 years.

He describes himself as a naturally calm, diligent person who loves children and is passionate about seeing people grow and building strong relationships.

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Prospects for South Africa’s Future The Development Bank of Southern Africa (DBSA) recently released a development report titled Prospects for South Africa’s Future. According to the DBSA, the report provides an independent perspective on South Africa’s potential long-term development path, including evidence-based projections, and should contribute to the work of key national departments, the National Planning Commission and other role-players.

Speaking at the launch, the editor of the report, Ms Sinazo Sibisi, said, ‘Partnerships and implementation capacity are prerequisites to a successful South African development path.’

According to the DBSA, the report draws heavily on the DBSA’s many decades of experience as a development facilitator and financier. In launching the report, the DBSA said it would like to share with its stakeholders aspects of the challenges within its scope, in its mandate, and along its current and proposed development trajectory as a leading regional development finance institution.

The purpose of the detailed and comprehensive report is to provide an independent, DBSA perspective on South Africa’s potential long-term development path. This report does not seek to predict what will happen in the future. Rather, it sets out the key drivers that will affect whether and to what extent South Africa will succeed. The chairperson of the DBSA board’s Development Planning Committee, Andrew Boraine, says, ‘The report highlights the priority areas that need to be addressed if a sustainable and inclusive development path is to be attained, and by suggesting possible areas of focus and associated programmes to set South Africa on a new trajectory.’

This report, part of a series dating back to 2003, is one part of the DBSA’s contribution to South Africa’s development planning. Much of the work draws on contributions to ongoing engagements with key planning and implementation government departments and other development role-players. The DBSA’s analysis suggests that, on South Africa‘s current path and capacity, many of our country’s development goals are unlikely to be met.

These include those relating to employment, reindustrialisation, skills development and climate change.

The characteristics and extent of GDP growth and employment creation are unlikely to be sufficient to address high levels of poverty and inequality, while the effectiveness of the South African state remains hampered by significant capacity gaps. Contestations about the slow pace of the South African transition to inclusive development have increased, amidst growing community frustrations over inadequate accountability and lack of service delivery. Thus changing this path will require a higher level of realism

regarding what South Africa can achieve and within what timeframes and parameters.

At its core, the report argues that South Africa’s development success will hinge on the partnerships and the execution capacity that are created to translate plans into action. While there are recent signs of positive change, including in the difficult municipal and health sector environments, much more needs to be done.

The DBSA’s group executive for development planning, Ravi Naidoo, stressed the need for, ‘South Africa Incorporated to have a clearer set of actionable priorities, partnerships that can implement them, and a professional public sector that can ensure that these priorities and the state’s routine work are implemented as required. As with developmental states anywhere in the world in the past century, this requires capable and stable political governance that ensures that priorities and skilled professionals remain in place long enough to enable implementation.’

The editor of the report summed up the report’s short-, medium- and long-term interventions in three categories: • Act now: to improve the quality of education, enhance political governance, stabilise government admin istrations and consolidate economic stewardship.

• Act together: by increasing public-public, public-private and public-community partnerships to maximise our collective strengths and drive integrated solutions to our common challenges.

• Act differently: by taking conscious action to put long term national interests before short-term individual gains and to let go of dysfunctional values systems and outdated paradigms, thus opening the way for South Africa to chart a new course.

An overview of the report is available on www.dbsa.org

Above: Seen during the launch of the report are (left to right) the editor of the report, Ms Sinazo Sibisi, and DBSA’s group executive for development planning, Ravi Naidoo.

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Persistence pays at Productivity SA’s Annual Awards It was a glittering occasion on the Friday evening of 28 October, when Productivity SA celebrated its National Annual Awards at Gallagher Estate in Midrand. Productivity SA has for more than 40 years helped thousands of companies to improve their productivity and hence their competitiveness by imparting excellent project management skills and labour practices to the companies involved.

An important aspect of the work of Productivity SA is the preservation and creation of jobs. Through its Turnaround Solutions programme, Productivity SA saved more than 16 000 jobs during the 2010/11 financial year – in agriculture, manufacturing, the civil engineering and construction sector, and the clothing and textile industry. In this year, 130 companies participated in this programme.

Productivity SA’s National Annual Awards fall at the end of Productivity Month, a campaign that seeks to promote the importance of productivity and to inculcate a sense of competitiveness in every South African.

Continuing shortfall In his welcoming address, Alwyn Nel, chairman of the board of Productivity SA, quoted from recent research by Absa Capital to highlight South Africa’s continuing shortfall in productivity and competitiveness.

Absa Capital expects the South African economy to grow by 3.1% in 2011. South Africa’s quarter-on-quarter growth in Q3 was 1.3%, mirroring the growth of Q2, said Nel. ‘Despite the eurozone crisis, a high level of uncertainty in the global economy and a bleak manufacturing sector picture locally, South Africa itself is far from being in a recession.

Indeed, if the manufacturing figures hadn’t been so dire, the second-quarter GDP growth of 1.3% would have been closer to 3%,’ he added.

Unfortunately, the growth over this period hasn’t translated into jobs: South Africa’s formal non-agricultural sector only managed to create 7 000 jobs in Q2, compared to 38 000 created in Ql.

annual World Competitiveness Yearbook results. In its 2011 report, South Africa has dropped eight places in its competitiveness ranking, from to 44 to 52. Published by Switzerland’s Institute of Management Development, with whom Productivity SA is the information partner for South Africa, the World Competitiveness Yearbook is drawn from the macroeconomic evaluation of domestic economies.

‘A review of the South African economy highlights the fact that that our biggest challenges remain quality of education, health standards and labour relations,’ he explained.

Nel continued to explain that attention was drawn to South Africa’s comparative lack of competitiveness by the deputy president of Business Unity South Africa, Professor Raymond Parsons, at last year’s National Awards.

‘SA is not yet attracting enough fixed direct investment for growth purposes and we should also recall that about five years ago South Africa was ranked 34th in the world competitiveness assessment,’ said Parsons at the time.

Productivity attracts FDI Nel added that in the previous year, South Africa saw its foreign direct investment fall by more than 70% to $1.6 billion, only one sixth of the peak amount recorded in 2008. The country was also just 10th in the ranking of Africa’s top 10 recipients of FDI inflows in 2010, compared with fourth place in 2009.

Earlier this year, the World Economic Forum (WEF) in Cape Town called on African governments to better harness the region’s resources through stronger integration into international trade and finance, to improve educational systems, to enhance entrepreneurial opportunities for women and to develop their tourism sectors in order to become more competitive. Five key areas that were highlighted included: • Region in need of better integration • Improved educational systems • Expanding women’s opportunities in entrepreneurship

The challenge of competitiveness ‘However, South Africa undeniably continues to fall short of its optimal productivity and competitiveness levels,’ Nel continued. This is glaringly reflected in the recent

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• Upgrading and harnessing tourism • National competitiveness councils ‘Indeed we need to increase our competitiveness in order to attain our growth targets as set out in the New Growth Path,’ emphasised Nel. He explained that the country, in terms of its productivity, was ‘sliding and there is a need to arrest that slide.

‘One way we can actively turn the situation around includes taking into consideration key areas outlined by bodies such as the WEF, which also made the recommendation for national competitiveness councils in order to promote the growth of the continent.’

Recently, Productivity SA became a fully fledged Department of Labour entity, which has forged closer allegiances and better working partnerships between the two organisations.

It was thus fitting that the Honourable Minister of Labour, Mildred Oliphant, addressed the awards evening.

Improving living standards She emphasised that productivity was not only the key to the performance of firms and industries, it was fundamental to the living standards of the general community. It is also the benchmark by which organisations can measure how efficient their use of resources is.

‘Productivity is about being aware at all times that the right attitude determines the required altitude,’ said the Minister. The awards, she explained, are but a tool among many aimed at spurring on productivity. ‘All the finalists were winners already because to get this far meant that they have gone the extra mile.’

And then it was time for announcing the award winners.

In the hotly contested Corporate Sector, top honours went to Adcock Ingram Critical Care, South Africa’s largest supplier of hospital and critical-care products, blood systems and accessories as well as products used for renal dialysis and transplant medication.

In the Public Sector, Limpopo Department of Roads and Transport burned up the tarmac to emerge as the clear winner.

The Emerging Sector of South Africa’s industry is the all-important incubator of the country’s larger successful businesses. In this sector, Limpopo Lumber took the coveted award.

In closing the award ceremony, the CEO of Productivity SA, Bongani Coka, explained that the resilient nature of the companies that were represented on the evening were a highlight in a week that had arguably tested the resolve of country to the limit.

‘Awards by their very nature often mask the hard work required to meet and even surpass set targets,’ said Coka. ‘However, despite the logjams and bottlenecks presented by the workplace, you still manage to produce a result that is worthy of acknowledgement by your peers,’ he said in conclusion.

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Productive capacity-building for the informal s

By Mokgadi Mahlakgane The informal economy contributes immensely to the economic growth of most developing countries and its importance is underscored by the fact that it is where the bulk of the population, including most of the poor, mainly women, works. In Africa, urban informal employment was estimated to absorb about 60% of the urban labour force and generate more than 93% of all new jobs in the regions in the 1990s. The size of the informal economy, which has witnessed phenomenal growth in the past three decades, as a share of the GDP in Africa is estimated at about 41%.

The majority of workers in the informal economy of Africa suffer from multiple vicious cycles of poverty and vulnerability which perpetuate their low skills, low productivity, high unemployment, low product quality, and low-income working lives. Improving the skills and productivity of the informal economy workers will result in higher incomes and subsequently improved working conditions and living standards.

Employment in the informal sector, in particular for the youth and women, is now an important feature on the landscape of Africa, accounting for a significant share of GDP and influencing the well-being of a growing number of households. The character of the informal sector on the continent has changed if ever so slightly as growing numbers of those who now enter this employment do so with higher levels of education than those before them.

The new entrants also bring entrepreneurial aspirations that look at this employment as a preferred destination for their future rather than merely a staging ground for the ongoing search for wage employment in the modern sector.

Such developments have led the African Union to adopt

the Productivity Agenda for Africa (2010-16) which is aimed at productivity capacity development in the public sector, SMEs and the micro enterprises of the informal economy.

A workshop was conducted at the AU headquarters in Addis Ababa from 29 September till 1 October 2011.

The objective of the ‘train the trainer’ workshop was to impart knowledge, skills, competencies and the right attitude to participants in the understanding of productivity concept and the ability to apply some basic productivity improvement tools and techniques for improving business performance. The workshop was in line with both the Productivity Agenda’s Strategic Plan as well as with the AU Programme on Upgrading the Informal Economy and its Social Protection Plan for the Informal Economy and Rural Workers (SPIREWORK).

Two representatives from eight AU member states of the five AU regions participated in the workshop ie Ivory Coast, Senegal, Namibia, Tanzania, Rwanda, Cameroon, Tunisia and Ethiopia. The workshop was conducted by productivity experts from PAPA member countries: Ms Lalane Janse van Rensburg from Productivity SA, South Africa, Dr Bala Usman from Nigeria as well as Mr Franklin Muchiri, International Labour Organisation (ILO) senior specialist.

At the end of the workshop, the participants developed their national action plans as the main output of the training session which will be monitored by the AU. The action plans were aligned to the Productivity Agenda for Africa with the following objectives: 1. Increase the productivity and competitiveness of African small and informal enterprises 2. Facilitate the improvement of productivity culture among small and informal enterprises 3. Promote the use of productivity approaches, techniques, tools and processes by all stakeholders 4. Mobilise all relevant stakeholders at a national level The informal economy is recognised by the African

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sector operators in Africa Union as essential for its member states to achieve the Medium Development Goals, and reverse the persistent trend of unemployment, underemployment and poverty.

African micro small, and medium enterprises (MSMEs) account for more than 70% of enterprises in the economy and create more than 90% of formal and informal jobs.

But the current productivity reality in the continent will not improve significantly without a comprehensive agenda, as the challenges are many and daunting.

According to the ILO, the largest gap of productivity is encountered in Africa (ILO 2007) with a value added per worker 12 times less in Sub-Saharan Africa than that of a worker in the industrialised world and four times lower in North Africa. That is largely due to the fact that in Africa around 80% of workers are in the informal economy, the rural economy (RE) and SMEs, while they contribute about 60% of GDP, and these sectors are still damped by very low productivity scores. The productivity challenge for Africa is based on the fact that the large majority of the

workers in the informal economy still do not earn enough to lift themselves and their families above the US$2 a day poverty line.

Against the backdrop of the above situation, the strategy of the AU Productivity Agenda (2009-15) aims to ‘promote productivity in key sectors of the economy, in particular the informal economy, SMMEs, public/parastatal sector, industry and communities’. One of the envisaged activities is to ‘establish and/or enhance the capacity of supporting organisations to SMMES in providing productivity counselling/consultation services.’

This is the rationale of the Productive Capacity Building Training Programme. The pursuit of upgrading and improving Africa’s informal economy (IE) is crucial and critical to Africa’s development and progress and its integration into the global economy. Therefore, it requires building the capacity of the IE units/operators, in the form of ‘train the trainers’, so that they are fully equipped with skills and knowledge to identify the sector’s problems and be able to develop and implement productivity and quality improvement activities in the sector.

(Adopted from the Concept Note of the AU Productivity Agenda for Africa)

Above and right: Delegates at the AU workshop held in Addis Ababa, Ethiopia.

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Achieving aligned commitment through employee benefits

By Chanique Fonto ‘Happy staff, happy clients’ – the truth of this saying is often underestimated. When employees are well looked after and work in a secure environment knowing that their retirement is taken care of and medical risks are contained, they can focus on the work at hand and servicing customers well.

The alternative is also true. When employees are not taken care of, they are distracted by financial and other personal issues and will move to other companies in search of better working conditions. When there is a high staff turnover, the cost of recruiting and training new staff

seriously affects the net profit of the company. The company also runs the risk of losing clients when its primary contact from a service provider is no longer available. Research shows that there is a correlation between high employee turnover and low customer retention. Securing new clients is much more costly than servicing existing clients.

Urban, Van Vuuren and Barreira (2008) found that business knowledge and work experience are positively associated with entrepreneurial success. The accumulation of knowledgeable human resources and social capital has a high impact on business success. When employees leave or fall ill, knowledge and intellectual property will leave with them. Cassar (2006) agrees that investment in human resources leads to entrepreneurial success. According to Forin, Lubatkin and Schulze (2003), it is important to have the correct human capital, such as team members with the correct education, experience, knowledge and skills. They identified human capital as a critical resource for business success. Sonnentag and Frese (2002) also stated that the importance of human capital is increasing as information is becoming freely available and knowledge-intensive activities increase in most industries. It is therefore clear that it is in the best interest of the business and its sustainability to maximise employee retention.

In the current market, with budgets being cut dramatically,

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it is important for employers to find innovative and costeffective ways to improve employee morale. It is also the duty of the employer to stay abreast of trends in the market and take advantage of new opportunities. Gap cover, for instance, can be provided to employees at an average cost of about R94 per month. The effect on the peace of mind of the employee will be dramatic. Knowing that all in-hospital bills will be settled, no matter how much the medical aid pays, can contribute hugely towards employee loyalty.

In line with the National Health Insurance Policy Paper of 2011, it is an objective to make quality healthcare available to all South Africans. According to the Policy Paper, contribution rates per medical scheme beneficiary have doubled over a seven-year period, which has not been proportionate with increased access to services. This disparity leads to limited access to needed health-service coverage. The new design of the medical scheme benefit options has payment gaps with early exhaustion of benefits as a result. This poses a real concern and detractor for an employee who has to provide for his or her family.

According to the NHI, ‘out-of-pocket payments account for a significant part of total health expenditure and this could be in the form of co-payments, or direct payment to private providers, particularly by those who are not covered by medical schemes’.

Even for those who are covered by medical schemes, the extent of co-payments confirms that the current system does not provide full cover. However, for those who are not on medical aid, this could have catastrophic effects. When employees cannot afford to pay out of pocket for unplanned medical events, payment gaps will either result in untreated conditions, increasing absenteeism at the company, or financial hardships resulting in a lack of focus, productivity and team cohesiveness.

The most effective manner of keeping a team cohesive and motivated is through looking after their needs while clearly communicating company vision, goals and objectives to a point where there is general buy-in. Beal, Cohen, Burke and McLendon (2003: 989) ask the question: how to capitalise on team cohesiveness in order to positively affect business success? They conclude that the way to achieve team cohesiveness is to work group applications and benefits throughout the organisation.

The make-up of every team should be aligned with, and work towards, achieving organisational goals. It is important to identify the factors and processes that give rise to increased performance.

Naquin and Tynan (2003: 332) agree that realising the business’ objectives can only be achieved through becoming a preferred employer. By integrating the skills and characteristics of each team member, performance can be improved. In essence, it is a situation where the sum of the team members should be better than each individual member of the team.

In the current market, with budgets being cut dramatically, it is important for employers to find innovative and costeffective ways to improve employee morale.

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Achieving success through doing it right

By Frances Wright In a recent study conducted with regards to business success, it became clear that South Africans are highly enterprising and can find innovative ways of making a living. What has also become clear, however, is that only about 3% of entrepreneurs become employers, thus affording employment to somebody else. Most entrepreneurs remain lifestyle entrepreneurs, creating work and an income for themselves, but not interested in or able to grow the business. These entrepreneurs have to be commended.

They earn an honest living, they are not dependent on anybody else and they provide a valuable service or product to the market. The problem comes in when the entrepreneur cannot work any longer. No value has been created. There is no separate legal entity that can carry on regardless of the involvement of the lead entrepreneur and, therefore, no retirement plan or legacy left for the next generation. Through the research, it has become clear that some entrepreneurs want to grow their businesses, but are either risk averse or do not have the necessary skills. It is therefore necessary to commend those entrepreneurs who

do grow their businesses, eventually providing employment to hundreds of people while turning over millions of rands and creating wealth for all stakeholders. Through intensive literary research, it became evident that most scholars measure business success according to net profit and growth in turnover and employees. Another factor is client satisfaction. But how is this achieved? Through doing things right. The problem is to find out what the right thing to do is.

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Rob Clarke, group managing director of Puregas (Pty) Can it be done? Secondly, is there a market? In other Ltd, contends that the success of the company is due to words, is there a portion of the population that actually a narrow focus and choosing a product that is in demand. needs the product or service?

Puregas was started in 1971 and is today Sometimes the need can be created, as an award-winning company, recognised was the case with the cellphone. Twenty as Southern Africa’s leading supplier of years ago, nobody ‘needed’ a cellphone. purified and blended gaseous hydrocarbon But to change human behaviour is capital propellant, foam-blowing products and highintensive and requires a big marketing quality speciality gases and gas equipment, budget. Once the need is established, it is providing employment to approximately 40 important to find out the parameters of the employees. To have grown the company by need and develop the product and service 11% during a recession is no mean feat. exactly according to such a need. Offer a Being a good strategist and having total solution to a need. financial training and leadership qualities The third filter is to determine whether it that showed at a young age all contribute to is financially possible to deliver the service Above: Group managing director of the ability to navigate and grow a company or product at a market-related price while Puregas (Pty) Ltd, Rob Clarke. in difficult times, but the main ingredients still making a profit. When starting out in a to business success are a cohesive team, retaining staff market where there are existing suppliers, it is important and suppliers, an absolute focus on service and safety, and to understand the financial requirements and to determine having good mentorship and support. whether bigger competitors and the resultant economies of ‘Of course our focus on quality throughout the company scale will create a scenario where a smaller supplier will be is a major contributing factor,’ says Clarke. ‘Our suppliers too expensive. This is a recipe for failure, unless a unique are chosen according to their qualdifferentiator can be found to compel ity standards and maintaining our customers to buy at a higher rate.

ISO 9001 certification brings about When considering all these factors, a carefully worked-out quality proentrepreneurship is not for the faintgramme, forming a circle of excelhearted, but when everything falls lence that is documented in a value into place and the business grows, policy. An employee of the month it is hugely rewarding, financially as is chosen according to excellence well as through self-actualisation. in conduct.’ A further component of The feeling of providing the market the business’ success is its marketwith a much-needed product such ing activity, a good brand, regular as propellants and speciality gases contact with customers and knowing (which laymen do not even know the market will contribute towards they are using, but without which successful growth in a business. life would not be the same) is hugely ‘Ultimately, it is having a purpose, satisfying. When, in the process, an discipline and surrounding yourself with the correct skills entrepreneur can also provide people with employment in that will bring about business success. That includes building a happy, friendly environment, an entrepreneur has to feel a good team, each having a defined role, a good reward as if his or her life on earth has counted. Everybody wants and recognition system, and continuously doing employee to leave a legacy. development and skills training,’ continues Clarke.

All these ingredients of business success will Frances Wright is the MD of Trinitas Consulting, a supplier contribute towards growing a business, but only if the specialising in creating profitability through the integration of original idea is viable. The Gem report of 2006 shows communications, marketing and operations. An entrepreneur that of the 97% of entrepreneurs that do not grow their herself, Frances has had 16 years of experience in the communications industry and, with a BSc in Industrial businesses, only 17% make a good living. So why do 80% Technology and Management (Honours) and an MBA, of businesses that open up fail completely and cease to she specialises in the operational health of companies, exist? It seems as if entrepreneurs in South Africa fail to assisting them to create sustainability. She is currently doing do the necessary research to ascertain whether the idea her PhD on the effect of processes on business success. For is actually an opportunity. There are three filters through more information, contact Frances on 011 262 2814, email which a business idea should be put before capital and her on frances@trinitas.co.za or go to the Trinitas website at often life savings are invested in the idea. The first filter www.trinitas.co.za. is to ascertain whether the idea is operationally possible.

Being a good strategist and having financial training and leadership qualities that showed at a young age all contribute to the ability to navigate and grow a company in difficult times.

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CASE STUDIES

Workplace Challenge case study M-TEC is situated in Vereeniging and employs 526 people.

The company manufactured South Africa’s first stranded copper wire as far back as 1924 and produced the country’s first aluminium rod in 1955. Today it is one of the country’s undisputed leaders in the manufacture and supply of power cables, aluminium overhead conductor, bare copper wire and optical fibre cable.

The reputation of M-TEC products is built on an absolute insistence on high quality and the company attained ISO 9002 accreditation in 2003.

M-TEC is proud to have been awarded 4 Stars on the NOSA 5 Star CMB 150 Safety and Health System. M-TEC’s product list includes Aluminium Fibre Optic Cables and Optical Fibre Ground Wire (OPGW).

OPGW M-TEC’s OPGW series is an entirely new form of telecommunication line which combines a ground wire for shielding overhead power transmission lines together with optical fibres for transmission of communication signals.

The product is designed to resist strong winds, lightning and short circuit current. The OPGW has been designed

to meet both the electrical and mechanical equivalent of conventionally ground wire.

M-TEC joins Workplace Challenge Programme M-TEC joined the Workplace Challenge Programme (WPC) in 2009. The 20 Keys programme managed by Organisation Development International (ODI) was implemented. (The 20 Keys programme supplied by ODI for WPC clients consists of 20 modules that can be selected on a needs basis.)

By taking a comprehensive look at their needs, M-TEC determined eight areas to be addressed by the WPC. They selected eight suitable Keys from the 20 Keys programme.

Step 1 – Creation of Mini-business Units (MBUs) To launch the 20 Keys / Workplace Challenge Programme, ODI conducted Mini Business Unit (MBU) workshops with the first-line personnel and top management. This resulted in the identification and establishment of 28 MBUs. The first challenge facing management was to get all of the shopfloor level people involved in the mini-business. In some divisions the lack of participation seemed to be as a result of a lack of commitment from the first-line management.

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The problem persisted throughout the duration of the twoyear programme.

Step 2 – Implementing Key 11 (Quality Control) Quality has always been core to M-TEC’s vision and mission. However, the ISO 9001:2000 Business Management System needed to be sustained and thus M-TEC also selected Key 11.

When the company audited their performance on NCRs (Non-Conformance Reports) they realised that in the month of June they had 44 customer returns. Therefore the first technical focus point of the Workplace Challenge Programme was to implement Key 11 by training divisional managers, supervisors, operators and plant level committee members in the principles of quality, coupled to the NCR policy.

Over the two year course of the 20 Keys programme, the NCRs declined steadily.

Step 3 – Implementing Key 16 (Production Scheduling) On-time-delivery and quality go hand in hand with customer satisfaction and to implement a system that would ensure on-time delivery performance for customer satisfaction, M-TEC selected Key 16 as well and also held a production scheduling workshop with Production Planners.

The company utilised the services of industrial engineering students to conduct time studies and to set appropriate time standards for key machines and operations.

On-time delivery improved steadily.

and needed all to contribute to its rescue. Management wanted every employee to be able to measure themselves, to participate in a culture of measurement and everyone’s goals to be aligned to the company’s goals. They saw in Key 2 a solution to the need for Goal Alignment. The company started with Goal Alignment by training all the PLC members on the priority keys selected so they could serve as change agents within the organisation.

The most important aspect of Goal Alignment was to agree on performance measures and put up performance charts in MBU areas. Mini Business measures and targets differed according to the nature of work per division and sections. The frequency of measurement was established as daily, weekly or monthly, based on the complexity of the measure. The overall company goals were classified into five categories following the 20 Keys discipline.

Step 6 – Applying Key 9 (Maintaining Machines and Equipment) Another of the company’s needs was to implement a system of preventive maintenance instead of reactive maintenance, to improve the level of maintenance of machines and equipment. Key 9 was selected.

The Key 9 Action Plan included: 1. Identifying model machines per division 2. Identifying what operators should check on a machine 3. Developing check sheets for all model machines and training operators to use check sheets)

Step 4 – Implementing Key 1 (Cleaning and Organising) Some areas on the company premises were very dirty and disorganised – hence the need to select Key 1.

Key 1 Key 1 was launched in phases – first in the operations and engineering divisions. M-TEC conducted Yellow and Red tagging exercises with these MBU teams, identifying unwanted and unsafe objects. These divisions continued with the tagging and removing of unwanted objects for almost four months. Then each work area was organised and cleaned according to the principles of visible management.

Next, Key 1 was launched in the support function with each MBU team arranging a date for cleaning and organising in their offices. Participation was high and unwanted items removed over a period of one month. Everybody organised their offices and filing systems according to 5S principles – ‘creating space for everything and putting everything in its place.’ Thereafter, an in-house inspection was conducted and a schedule for regular reviewing agreed upon.

Step 5 – Implementing Key 2 (Goal Alignment and Measurement) During the 2009 recession, management wanted every employee to understand that the company was in trouble

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Step 7 – Applying Key 10 (Workplace Discipline) Management needed to instill Workplace Discipline among employees so that the company could deliver on time and conform to all policies. The company selected Key 10. The Key 10 Action Plan focused on: • Selecting the most important Workplace Discipline criteria • Human resources started holding monthly meetings with the first-line management to discuss workplace discipline issues. The Key 10 check sheet was used as an agenda for the meetings to be able to keep focus • An external training programme was scheduled for the supervisors to broaden their knowledge and skills. The interim result of the application of Key 10 was a reduction in the number of grievances and discipline cases.

Step 8 – Applying Key 15 (Skill Versatility and Cross Training) M-TEC realised that in order to improve the company’s performance on quality, they needed to coordinate the education of employees better. Therefore they also selected Key 15 to address the company’s education needs.

M-TEC applied the 20 Keys and Workplace Challenge Skills Matrix practice on the SAQA (South African Qualification Authority) Unit Standards assessment framework.

As such the company assesses operators’ skills levels against Unit Standards for recognition purposes and

completes the company’s annual Workplace Skills Plan for MERSETA on the basis of scientifically determined Individual Development Plans (IDPs). The skills level of individual employees is thus recognised against a nationally accepted Skills/Qualifications Framework and so the employee’s skills assessment influences his/her job and salary level in the organisation.

The assessment is also recognised by other employers, enabling the employee to transfer their skills when they move to another employer. The company is busy applying the assessment process on its current workforce of 450 operators.

Step 9 – Key 3 and Key 6 (Small Group Activities and Kaizen of Operations) A part of the company’s recessionary problems were increasing costs. Management required employees to help think of ways to reduce costs by eliminating waste.

They selected Key 3 and Key 6 to harness the creative abilities of M-TEC employees towards eliminating waste. To establish the company’s Small Group/capability, M-TEC got a few Small Group Activities/Kaizen Teams going, focusing on problems such as the Fibre Failure Rate.

The Kaizen Team set the goal to minimise the total Fibre Failures by 50%. Applying a few useful Small Group/Kaizen techniques, they managed to reduce Fibre Failures by 55%.

Anecdotal evidence of the impact of the Continuous Improvement Programme Thembi Mathenjwa, organisational development specialist at M-TEC, highlighted the impact of the WPC programme: • The networking and site visits facilitated by the WPC provides M-TEC as a company with the opportunity to learn from other companies that have had experience with certain elements of the 20 Keys programme.

• The plant level committee has helped to solve many operational problems, such as absenteeism.

Joseph Gorewang, assessor in the Aluminium Department, said: • The new Unit Standards-based assessment framework gives the company the ability to audit skills levels.

• It also enables the company to reward employees according to their qualifications/skills level.

Impact of Workplace Challenge Programme The most recent external audit based on the 20 Keys produced average ratings. The ratings outlined the fact that despite successfully implementing eight Keys and improving on its performance significantly over a two year period, the company continues to face challenges in implementing some aspects of the programme. However, in addressing the situation, the management team recently replanned its Organisation Development Strategy and work is ongoing to maintain world-class standard at the company.

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CASE STUDIES

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Profibre Products Introduction Profibre’s vision is to grow an innovative, world-class company, manufacturing predominantly continuous Original Equipment (OE) products, to a local and international diversified customer base, using technologically advanced systems and processes.

Profibre was established in 1990 as a close corporation with an initial focus on diverse industrial products. The company developed a competence to produce unique, customised solutions for customers in diverse industrial spheres, from mining and construction through to port services and petrochemical plants.

In the late 1990s, Profibre started with its first smallscale OE supplies to Bell Equipment in Richards Bay, South Africa. The business grew as Bell Equipment grew and with each change in model the product range expanded, from bonnets to heat shielding, fan shrouds and special purpose covers.

As the demand for OE supply grew, Profibre strategically focused the business on this volume market segment. The company expanded its OE focus by securing the MAN bus and coach contract in 2001, Putco buses in 2006, Tata buses and Echo 4x4 trailers in 2007.

Supply to Original Equipment Manufacturers (OEMs) requires strong, controlled processes in line with a demand for quality, reliable, on-time delivery performance and costefficiency, so in 2005 Profibre embarked on a process of introducing lean management principles into its production system in order to entrench the philosophy of continuous improvement within its operations.

Turnkey solutions Due to the fact that Profibre has its own design, tool manufacturing, sourcing and manufacturing facilities, it is able to provide customers with a complete turnkey solution from product design through to the manufacture and supply of production parts or assemblies.

The organisation currently operates out of a 10 000m2

facility in Halifax Road, Pinetown, of which 8 000m2 is under roof. The company currently employs 239 employees.

Introduction of the Workplace Challenge Programme (WPC) Why was the WPC introduced?

The need for the company to sustain the culture of continuous improvement started in 2005, and getting the company up to a standard of world-class performance was one of the main reasons for Profibre Products adopting the Workplace Challenge Programme in February 2010.

Profibre wanted to become successful in its market against any competition regardless of size, country of origin or resources.

The managing director, Garry Coady, realised that worldclass manufacturing is not a milestone, destination or certificate programme, but rather an ongoing, never-ending journey towards total operational excellence.

The company wants to match or exceed any competitor

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on quality, lead time, flexibility, cost, customer service and innovation.

Having had some exposure to the Workplace Challenge Programme at another company, Garry saw in the Workplace Challenge Toolkit Programme a means of rolling out the principles of continuous improvement and lean management to every employee. The lean system, as facilitated by the Workplace Challenge Programme, engenders the company’s core values of customer satisfaction, being the best, providing innovative solutions, providing stakeholder value, integrity and respect.

In line with the managing director’s long-term vision, the Workplace Challenge Programme was introduced to

Profibre Products, after Coady had motivated every manager to complete a NQF Level 3 Learnership in Management.

Coady regarded leadership support as the foundation for a sustainable culture of continuous improvement/lean manufacturing such as the Workplace Challenge Programme.

How was the WPC Introduced?

Step 1 – Finding an Internal Facilitator/Project Manager Having ensured every manager’s buy-in and grasp of the big picture, the first step was to assign the responsibility for facilitating and coordinating the Workplace Challenge Programme. The company’s quality manager, Akash Hariparsad, was chosen for his enthusiasm and determination to follow through on the WPC initiatives.

Step 2 – Setting up Mini Business Areas The management team established Mini Business Areas/ Value Stream teams called Green Areas where teams could meet daily to discuss their performance and address operational problems. Through the Green Areas, the Workplace Challenge Programme gave the company’s lean manufacturing system a channel for communicating clear performance expectations and doing follow-up. The core of the system is visible leadership.

A standard element of the Workplace Challenge Programme is to introduce a system for managing innovations and for employees to participate in improvement activities – although Profibre as yet has not formally launched a system for managing innovation, each Mini Business Unit/ Value Stream measures the number of innovations/ideas suggested by team members per month. And as the saying goes, a problem is the mother of invention, so each Value Stream also measures the number of defects produced in various production processes. Applying the 80/20 or Pareto Principle, if a certain type of defect comes up too often, the Mini Business’ team members do a Fishbone Exercise, where the problem would be analysed by means of a big mobile whiteboard with a fishbone drawn on it. The problem or symptoms would be described clearly in the square in the position of the ‘fish’s head’.

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Then the team would be facilitated to brainstorm around a number of ‘fish bones’, each representing possible causes of the problem, ie management, man, method, measurement, machine or materials being possible causes of the problem.

When the team finds the most likely cause of the problem, they follow the next process of asking ‘Why?’ at least five times, until they get to the core problem. Once the core problem is clear, the team would then brainstorm possible solutions, which often result in an innovative idea being implemented.

Step 3 – Implementing the Goal Alignment Toolkit The external Workplace Challenge Facilitator trained every Mini Business team leader and managers in the basics of Goal Alignment. Goal Alignment as a concept entails an exercise whereby the company’s overall goals, vision and mission are cascaded down to every Mini Business Area while making sure that every Mini Business Area’s contribution to the Value Stream of the whole business is aligned to the overall goals of the business.

The management team facilitated this process by drawing up a Goal Alignment Action Plan in the form of a Gantt Chart which addressed actions such as Communication of Company Vision and Mission, Formulation of Performance Measures for each Manager and each Mini Business Area, Establishment of a Plant-Level Committee (a kind of internal organisation development body to oversee the implementation of the Workplace Challenge Programme), Selection of Mini Business Names, Identification of Internal Workplace Challenge Auditors, and Planning a Means of Giving Recognition for Achievements with regards to the whole programme.

These Action Plans were posted at all of the Mini Business Areas for all Value Stream employees to see, and teams formulated their own vision and value statements, ensuring awareness and alignment of individual versus organisational goals, vision and values.

way as Goal Alignment. Again, Akash and the management team first sat down to draw up an Action Plan for this module to be able to coordinate all efforts.

And although the company does not have any tangible result to report in regard to Cleaning and Organising yet, the visual impact is already clear.

Innovations on the Cleaning and Organising Process Usually one of the elements of Cleaning and Organising is to apply the practice of Red Tagging. All Mini Business teams put in a concerted effort to do a thorough ‘stock take’ of redundant/unused items of equipment or materials (Red Tagged).

Then all these Red Tagged items are moved to an area where they can be viewed by other teams and reassigned to where they might be used more productively.

Akash went one step further by creating an electronic ‘log sheet’ where all of Profibre’s Red Tag items were logged for electronic internal advertising, and as a result the relocation process could be better coordinated and finalised much more quickly than otherwise!

World-class manufacturing is not a milestone, destination or certificate programme, but rather an ongoing, never-ending journey towards total operational excellence.

Impact of Goal Alignment and the implementation of the Mini Business structure Performance on Profibre’s most important goal, namely quality, is seemingly starting to improve – earlier in 2011, customer returns seemed to be on the increase (but that is because everything is now measured as a result of finetuning Profibre’s measurement system) whereas, since April 2011, the number of customer returns is beginning to decline to below Profibre’s target line.

Step 4 – Implementing the Cleaning and Organising Toolkit The Cleaning and Organising Toolkit was tackled in the same

Conclusion Although Profibre might have had a slow start with the implementation of the Workplace Challenge Programme, due to relocation, it has established a sustainable discipline of Goal Alignment, and Cleaning and Organising. It is also reaping many benefits from an informal approach to harnessing innovations from the shop floor. It seems clear that once it starts to implement the Teamwork Toolkit, its upward spiral towards world-class performance will be consolidated!

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te a fe w o u m a st iv ld l t P e r i k s e e od a s to u c on w tiv an is h it y S y d b l ou A L es a e s e s a ad fe e r d 20 12 .

humour

Getting productive in the North Pole Streamlining was appropriate in view of the reality that the North Pole no longer dominates the season’s gift distribution business. Home shopping channels and mail-order catalogues have diminished Santa’s market share, and he could not sit idly by and permit further erosion of the profit picture.

The reindeer downsizing was made possible through the purchase of a late model Japanese sled for the CEO’s annual trip. Improved productivity from Dasher and Dancer, who summered at the Harvard Business School, is anticipated and should take up the slack with no discernible loss of service.

I am pleased to inform you and yours that Rudolph’s role will not be disturbed. Tradition still counts for something at the North Pole. As a further restructuring, today’s global challenges require the North Pole to continue to look for better, more competitive steps. Effective immediately, the following economy measures are to take place in the ‘Twelve Days of Christmas’ subsidiary: • The partridge will be retained, but the pear tree never turned out to be the cash crop forecasted. It will be replaced by a plastic hanging plant, providing considerable savings in maintenance.

• The two turtle doves represent a redundancy that is simply not cost-effective. In addition, their romance during working hours could not be condoned. The positions are therefore eliminated.

• The three French hens will remain intact. After all, everyone loves the French.

• The four calling birds were replaced by an automated voicemail system, with a call waiting option. An analysis is underway to determine who the birds have been calling, how often and how long they talked.

• The five golden rings have been put on hold by the board of directors. Maintaining a portfolio based on one commodity could have negative implications for institutional investors. Diversification into other precious metals as well as a mix of T-Bills and high-technology stocks appears to be in order.

• The six geese a-laying constitute a luxury which can no longer be afforded. It has long been felt that the production rate of one egg per goose per day is an example of the decline in productivity, therefore three geese will be let go • The seven swans a-swimming is obviously a number chosen in better times. Their function is primarily decorative. Mechanical swans are on order. The current swans will be retrained to learn some new strokes and therefore enhance their outplacement.

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As you know, the eight maids a-milking concept has been under heavy scrutiny by the EEOC. A male/female balance in the workforce is being sought. The more militant maids consider this a dead-end job with no upward mobility. Automation of the process may permit the maids to try a-mending, a-mentoring or a-mulching.

Nine ladies dancing has always been an odd number. This function will be phased out as these individuals grow older and can no longer do the steps.

Ten lords a-leaping is overkill. The high cost of lords plus the expense of international air travel prompted the compensation committee to suggest replacing this group with 10 out-of-work congressmen. While leaping ability may be somewhat sacrificed, the savings are significant as we expect an oversupply of unemployed congressmen this year.

Eleven pipers piping and 12 drummers drumming is a simple case of an out-of-date band getting too big.

A substitution with a string quartet, a cutback on new music, and no uniforms, will produce savings which will drop right to the bottom line.

Overall we can expect a substantial reduction in assorted people, fowl, animals and related expenses. Though incomplete, studies indicate that stretching deliveries over 12 days is inefficient. If we can drop ship by UPS in one day, service levels will be improved.

Regarding the lawsuit filed by the Bar Association seeking expansion to include the legal profession (‘13 lawyers a-suing’), a decision is pending.

Deeper cuts may be necessary in the future to remain competitive. Should that happen, the board will request management to scrutinise our Snow White Division to see if seven dwarfs sleeping, sneezing, grumping, etc are in line with our overall projections.

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