project lambda

Download Project Lambda

Post on 06-Jan-2016

20 views

Category:

Documents

0 download

Embed Size (px)

DESCRIPTION

Eskom Enterprises (EE) Transformation. Project Lambda. Portfolio Committee on Public Enterprises. Presentation and Feedback 03 September 2003. Todays Objectives. To present a brief context of Eskom Enterprises transformation - PowerPoint PPT Presentation

TRANSCRIPT

  • Project LambdaPresentation and Feedback 03 September 2003Eskom Enterprises (EE) TransformationPortfolio Committee on Public Enterprises

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Todays ObjectivesTo present a brief context of Eskom Enterprises transformation

    To present the positive implications of Eskom Enterprisess new, chosen strategic direction

    To review the critical success factors of the new business case for Eskom Enterprises

    To provide feedback which should respond on the queries of the Portfolio Committee on the status of Eskom Enterprsises

    To highlight key challenges facing Eskom Enterprises

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    EE BackgroundEstablished in 1999 to carry out the non-regulated activities of Eskom inside and outside of Africa.Inherited numerous businesses and capabilities from Eskom, including aircraft, land surveying technologies, IT, telecommunications, primus stove manufacturing, engineering and construction, fleets of vehicles, etc. In total, 48 businesses and divisions!Core line of business include:Infrastructure development Energy business operationsSpecialised energy servicesPursuit of key opportunities in related or strategy business (IT, Telecoms)Outside of South Africa . . .

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    EE in the WorldTransmission network design and engineering inVietnamIndia China.Possible O&M of Generation Utilities in Sri LankaInvitations to participate in:MexicoBrazilUnited KingdomIn sum, a full plate. Management and resources were stretched!

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    R millions

    Revenue:

    2001 R2 370 m

    2002 R 2 906 m

    EE Financial PerformanceThe Chinese describe crisis as a time of great danger and a time of great opportunity. We truly have the opportunity to take EE into the future.

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Current analysis shows net EVA lossRotek and Roshcon are the primary value creators while head office and the telecomms businesses alone destroy more value than is created.

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    We have now reached the end of the business analysis and transformation design phaseBusiness Analysis and Transformation Design (12 weeks)ScopingAnalysingImplementation Planning

    123456789101112StrategyOrganisationDesign andDevelopmentTransform. EnablementWeeks13Business Unit StrategyCorporate StrategyBusiness CaseValue Analysis Project ManagementEE InitiativeOrganisation DesignManagement Profiling Balanced Scorecard Development (Level 1 3)Ongoing Communications Roll-outMISBal. Scorecard - DraftEVA AnalysisOrg Design ScopingMgmt Profiling ScopingComms baseline & readiness

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    The implementation will require effort and focus for the next 12-18 monthsStrategy Analysis:CorporateBusiness UnitValue AnalysisAnalysis & Design (12 Weeks)Implementation (12-18 Months)Organisation Impact:Organisation DesignManagement SkillsEnablers:Balanced Scorecard Comms & Mobs(MIS)Strategy Implementation:Focus on core businessDevelop business unit strategiesRealise divest opportunitiesOrganisational Implementation:Populate new structureDevelop / align key business processesBuild new functions (NED&M, Globalisation)Restructure corporate servicesDevelop required competencies and HR processesTransformation EnablementMeasurement and tracking BSC implementation Enabling infrastructureSystems supportCommunication & MobilisationWe are hereBusiness Case for ChangeBusiness Case Realisation

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    We have agreed some key principles by which to define EEs strategic focusKey Principles Eskom Enterprises must critically evaluate its core business and build focus around thisThe design, build, operation and maintenance of Generation, Transmission and Distribution infrastructure is currently EEs core businessWe will focus on business segments where Eskom Enterprises can build strong strategic positions in attractive markets

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Going forward, EE should focus on core activities, and operate primarily within SADC, Africa and Middle EastCore, 2nd Priority, 3rd PriorityPriority 1Priority 3Priority 2CoreSADCSA / EskomGenerationTransmissionDistributionDesignBuildOperateMaintainCore Business FocusHow should EE treat non-core businesses going forward?

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Analysis has shown that the further we stray from our core, the less likely we are to create valueNote:1. EVAs repeated across regions and not across segments; 2. An EVA calculation has not been performed for the SNO; 3. An operating profit has been used to size Enerweb and arivia.kom. Despite investment attractiveness or performance, should we divest out of non-core assets?Services vs. MarketsNegative EVAPositive EVAEskomSouth AfricaROWEnergyEnergy RelatedOther Services

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    The SADC capacity expansion presents a huge opportunity for EE but highlights timing and capability issuesSource:Generation & Transmission Expansion Plan Budget for Pre-feasibility and Feasibility studies Bain McIntyre; Focus Interview with Steve Lennon & Andrew Etzinger.Note: An exchange rate of R8 to $1 has been used to estimate the cost of each project.

    The capacity expansion opportunityThe portion prior to 2010The portion that is attractive to EEThe portion EE can currently do

    First wave of the capacity expansion is estimated to be worth R113bnApproximately R19bn will be spent prior to 2010R7,7bn of this is relevant to EEs current business and clearly attractive adjacent sub-segmentsEE is currently positioned to perform about R4bn worth of this work

    Metra Consulting (Pty) Ltd is an independent consulting company trading under licence from Cap Gemini 2003 Cap Gemini - All rights reserved0134_EE_EH_BusinessPlanInput_16Jul03_SVDrv * 2:26 PM

    The upcoming capacity expansion could result in massive growth of EEs defined core businessEE can potentially benefit from feasibility studies, design and project management relating to new builds and parallel refurbishment activity.The first wave of the capacity expansion will result in build and refurbishment projects worth R113bn.First Wave of Capacity Build ProjectsSource:Generation & Transmission Expansion Plan Budget for Pre-feasibility and Feasibility studies Bain McIntyre; Focus Interview with Steve Lennon & Andrew Etzinger.Note: An exchange rate of R8 to $1 has been used to estimate the cost of each project.

    FirstWave

    900

    1900

    2800

    3200

    3200

    4200

    8000

    20800

    32000

    36000

    R36bn

    R900m

    R1,9bn

    R3,2bn

    R2,8bn

    R4,2bn

    R3,2bn

    R20,8bn

    R8bn

    R32bn

    First wave of capacity build projects

    SpendPre2010

    557297224725720Build - PMBuild - PM13.46.4

    2008580437400360