DEPUTY DIRECTOR-GENERAL: REGIONAL

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Nov 18, 2013 (3 years and 11 months ago)

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DEPARTMENT
OF PUBLIC WORKS






PRESENTATION TO THE SACPCMP



BUTCHER MATUTLE


DEPUTY DIRECTOR
-
GENERAL: REGIONAL
COORDINATION




13 JUNE 2013





Contents of this presentation

1.
Executive Summary

2.
Context for the Turnaround Strategy and 7
-
year plan

3.
Strategic Priorities and alignment with MTSF, NDP, SPP, APP

4.
High
-
Level approach and timeline

5.
Project structure and resourcing

6.
Change Management and organisational ownership

7.
Risk management and stakeholder relations

8.
Project plans

9.
Budget

2

This presentation provides only a brief overview of the turnaround strategy and 7
-
year plan. It has been compiled using excerpts from the comprehensive documents.

Executive Summary

Executive Summary (1)

4

1.
Driven
by eight consecutive years of under
-
performance, evidenced by progressively
worse audits, the DPW launched a turnaround project in 2012. The project aims to
restore the department to organisational health across all
perspectives.

2.
Prior
attempts at change have proved unsuccessful, largely owing to leadership
instability and ineffective change management, resulting in a lack of ownership by the
organisation
.


3.
The change required is significant and touches
on all
areas of the organisation as well
as the way in which it does business
.


4.
The project has been structured in 3 phases,
the first of which focusses on
stabilisation.

This is crucial to establish a stable base for subsequent far
-
reaching
changes.
This phase is already under way and runs until 1 April 2014.

Executive Summary (2)

5

5.
In
tandem with the Stabilisation Phase, a long
-
term view of the DPW
is being
developed
. This process has already started and has structural implications.

6.
The
long
-
term view of the DPW will focus on the effective delivery of its core mandate,
ensuring that both scope and capacity exist to respond to the requirements of the NDP
and national infrastructure roll
-
out
in
terms of construction projects, job creation and
skills
development, as
well as harnessing the significant property portfolio of the state
for economic development
.


7.
The project is championed by the Director
-
General and supported by the Business
Improvement Unit. BIU resources are mostly internal with external experts recruited
-
in
to provide assistance and support as necessary. Where external resources are used,
active skills transfer to DPW resources has been agreed
.


Executive Summary (3)

6

8.
Ownership
of each of the 23 projects is vested in the organisation rather than in the
project team. This ownership has been formalised and linked to the individual
performance contracts of those concerned
.


9.
Significant additional support is provided by other Departments including National
Treasury’s Technical Assistance Unit (TAU), DPSA and SARS. We are also working
closely with client Departments across the various projects
.

Context for the Turnaround Strategy and Seven
-
Year Plan

Context for the Turnaround Strategy and 7
-
year Plan (1)

8

The
issues and challenges facing the DPW are not
new and the need for
significant change was identified as early as 2000. Despite numerous
attempts,
little traction was gained in a large and dysfunctional organisation.

Context for the Turnaround Strategy and 7
-
year Plan (2)

9

The key reasons for failure of previous attempts can be summarised as follows:


1.
High
levels of staff turnover


including Leadership


leading to a lack of continuity

2.
Inconsistency
of buy
-
in, understanding and
commitment


poor change management

3.
Lack of implementation capability and capacity

4.
Internal
power
plays and bureaucracy

5.
Culture
and attitude do not support or encourage
change


organisational inertia

6.
Objectives
over
-
optimistic and undermined by inadequate resourcing and lack of
systems
support

7.
Change fatigue

It is vital that the scope be clear, objectives are realistically achievable and the
processes adopted are pragmatic for the turnaround project to have
the best
possible chance
of success.

Strategic Priorities and Alignment

Strategic Priorities and Alignment (1)

11

1.
It is vitally important that any turnaround efforts should support not only the
DPW’s own organisational performance but also National priorities.

2.
To this end, we mapped the proposed turnaround projects against the MTSF,
NDP, APP and SPP goals and objectives.

The MTSF (2009
-
2014) aims to set the country on a higher and
sustainable trajectory of economic growth

1.
Infrastructure
development will drive this process.

2.
This
is to be accompanied by an expanded and more diversified economic base, with
unemployment, poverty and income inequality being reduced. Economic growth and
development, including the creation of decent work and investment in quality education
and skills development, are at the centre of government’s programme.

3.
In
this context, the thrust of the Department of Public Works’ Annual Performance Plan is
based on the priorities set out in the MTSF, the manner in which national and
international dynamics may influence the achievement of these priorities, and the
mechanisms required to plan, measure, monitor and evaluate implementation and
progress in these priority areas.

12

There is a high degree of correlation between the DPW goals and those of the MTSF
.

12

These goals are also very similar to those articulated in our existing
Strategic Plan

1.
To
provide strategic leadership in effective and efficient immovable asset
management and in the delivery of infrastructure programmes

2.
To
contribute to the building of a developmental state and a comprehensive rural
development framework through state assets

3.
To
ensure improved service delivery in all DPW programmes to meet clients’
expectations and leverage stakeholder relations

4.
To
promote an enabling environment for the creation of both short and sustainable
work opportunities, so as to contribute to the national goal of job creation and poverty
alleviation

5.
To
ensure transformation and regulation of the construction and property industries to
ensure economic growth and development

6.
To
ensure effective corporate governance and sound resource
management

13

The DPW is fully
-
committed to supporting the NDP


The
NDP is at the centre of our National strategic thrusts. It
is a wide
-
ranging plan for
reform that includes most of the organs of state.
T
he DPW is fully
-
committed
to
supporting the
NDP

and the correlation
between our strategic focus areas and the
goals of the NDP is high
.


Within
the DPW
, the Office of the DG, through
the
BIU
, is tasked with delivering the
turnaround of the DPW.
The overarching goal of the Turnaround Project is to
return the DPW to a state of competence
in the
delivery of its mandate
.


O
ur
turnaround is a critical element of our strategy, not an indulgence or a peripheral
project. If we do not address the
problems
identified we will
not improve. It directly
affects all of us and requires active participation. With this in mind, support
for the NDP
will be through the various branches of the DPW rather than via the Turnaround
Project
.



14

While National priorities drive the DPW’s strategic goals, the DPW
goals, in turn, drive the turnaround project’s focus areas

15

T
he
turnaround
project consists
of 23 discrete
projects. Our
key focus
in the short
-
term,
however, has
been on taking control of six key
areas:


1.
Developing a complete and credible register of state immovable assets

2.
Conducting a comprehensive audit of Leases and the establishment of a Lease
Management Framework.

3.
Ensuring progressively improving audit outcomes for the DPW with particular attention
to processes, systems and controls and better supply chain management

4.
Actively reducing fraud and corruption in the DPW

5.
Meeting the needs of our Prestige clients

6.
Operationalising

the Property Management Trading Entity (PMTE) in terms of the
DPW’s
mandate.

These projects are necessarily underpinned by improvements in
processes, systems and structures across the Department
.

High
-
Level Approach and Timeline

High
-
level approach and timeline (1)

17

We have launched 23 separate projects under the Turnaround umbrella.

While many of these have a short lifespan limited to the Stabilisation Phase,
others will continue for several years.

High
-
level approach and timeline
(2)

18

STABILISATION:

o
Improved compliance of asset register

o
Improved
GIAMA compliance

o
Systems support in place

o
Re
-
engineered lease processes

o
Optimal organisation design finalised (OFA)

o
23
x Stabilisation
project phases completed

o
Long
-
term DPW turnaround plan finalised

o
Unqualified audit with emphasis


EFFICIENCY ENHANCEMENT:

o
Majority of
assets compliant

o
Expanded asset register

o
Effective property management trading account

o
Technology
-
based organisation

o
Fully
-
implemented new organisation design

o
Public Works Act in place

o
Unqualified audit


SUSTAINABILITY & GROWTH:

o
95%+ of assets compliant

o
100% of leases compliant

o
Listed PFMA property
management trading entity

o
Municipal assets on asset register

o
Expansion to
Provincial support

o
Sustainable
and professional organisation


STABILISATION

2012
-

2014

EFFICIENCY
ENHANCEMENT

2014
-

2019

SUSTAINABILITY AND
GROWTH

2019 +

TRANSFORMATION AND CHANGE MANAGEMENT

Change Management and Organisational Ownership

Change Management and Organisational Ownership (1)

20

There are a few key considerations worth noting before embarking on a significant
change project. Large and complex projects that require significant change often fail
because of



1.
A lack of understanding of the broader context and how it impacts the
organisation

2.
A lack of understanding of the changes contemplated

3.
Insufficient communication

4.
Poorly defined change roles and / or processes

5.
Relationships which lack a strong foundation or commitment

6.
A directive rather than a consultative
approach

Change Management and Organisational Ownership (2)

21

With
the above in mind, it is vital that the following elements are integrated into
our
change
strategy
:


1.
Early attention to the organisational issues raised and Quick Wins
identified.

2.
Regular
, simple and clear communication to the DPW staff regarding the scope, ambit
and objectives of the change project

3.
Constant
reference to stakeholders and ensuring that their communications needs are
being met

4.
A clear plan, effectively implemented by a project team with sufficient capacity and
capability

5.
Clear executive ownership and championing of the change



Organisational issues that need
to be actively managed have already been identified via
roadshows
,
Ministerial visits and a workshop with Regional Managers and CFOs.

Change Management and Organisational Ownership (3)

22

1.
The BIU Change Management team is now up to its full complement of five resources:
Prof
Paruk
, Jacob
Mamobolo
,
Vuyo

Bavuma
, Sibusiso Zondi and Fikile Hugo under
the direct control of the Head of the BIU, Dhaya Govender.


2.
Leadership interventions are planned to enhance the understanding of change
management within the leadership levels of the DPW.


3.
Project champions have formally taken ownership of the 23 projects


4.
Change readiness assessments are in the planning stage.


5.
A change plan has been formulated and tabled.


6.
Regional issues are receiving attention. Branch Regional Coordination established.

Risk Management and Stakeholder Relations

Our project risk profile has improved. Organisational inertia and
compliance remain key issues, however, and cannot be underestimated.

24

Project Risks

1.
Failure of stabilisation

2.
Phase 2 failure

3.
Lack of stakeholder buy
-
in

4.
Reputational damage of
failure

5.
Lack of senior management
buy
-
in

6.
Insufficient project
resource capacity

7.
Industrial action

8.
Lack of technical support
capacity

9.
Disinformation and leaks of
classified information

10.
Lack of organisational
capacity (vacancies)

11.
Risk of retribution

12.
Organisational non
-
compliance / non
-
cooperation

13.
Inability to break
organisational bad habits

Highly unlikely

Possible

Almost Certain

Unlikely

Likely

Very
High

Medium

Minor

Negligible

High

Impact

Probability

2

3

1

4

5

6

7

8

11

10

9

12

13

Risks related to organisational inertia and
compliance are highlighted in yellow.

Project risks
may be summarised into three key categories
: Compliance, Capacity and Support

As an integral part of the development of
our
strategy, we identified the
stakeholders involved in the contemplated change.

25

Stakeholders include both internal and external constituencies and a
re
listed as the
following

(those highlighted in red text have yet to be effectively included):


Minister,
DM, DG

DPW
leadership

National Treasury

Unions

Cabinet

DPSA

AG

Portfolio Committee

Staff

Industry

Client Departments

Media

Entities

Project Team

General Public



While there may be many other stakeholders our view i
s
that the above a
re
the most
important, or influential, in the change process.


Project Plans

Project Plans (1)

27

1.
The following 2 slides present a draft representation of the likely duration of the 23
projects.

2.
For the purposes of the graphic, we have adopted 3 colour codes:

1.
Red = Stabilisation / fix the basics

2.
Orange = Process enhancement / improve on the basics or extend
the scope

3.
Green = Maintain and apply continuous improvement principles

Project Plans (2)

28

2012
2013
2014
2015
2016
2017
2018
2019
+
1
Asset Register
2
Leases
3
Clean audit of DPW
and PMTE
4
Regional Operations
5
Anti-Fraud &
Corruption
6.a
Re-opening of
workshop
6.b
Building of skills in
DPW
7
SCM Review
8
Governance and
Performance
9
Compliance Review
and Enforcement
10
Bills for Parliament
and policies (PMTE)
11
Tshwane Inner City
Regeneration
12
Change Management
Project Plans (3)

29

2012
2013
2014
2015
2016
2017
2018
2019
+
13
Key Account
Management
14
Prestige Clients
15
IT Platform
17
IDIP
18
PMTE
19
SIP 13
20
IDT (Independent
Development Trust)
21
EPWP
22
SDIP (Service Delivery
Improvement Project)
23
OFA
Budget

Turnaround Budget to 2015/16

National
Treasury
approved
project funding in the following annual amounts:


2012/13


R202 610
000

2013/14


R357 547
000

2014/15


R279 363 000

2015/16


R200 601
000


The above funding is reflected in the agreed 2012/13 MTEF
.


Additional
funding may be required for technology systems and infrastructure. Systems
and funding requirements will be developed in consultation with National Treasury
.


We have also asked National Treasury to approve roll
-
overs for several projects (IAR,
Leases, Clean Audit) that started later than planned owing to protracted negotiations with
Service Providers.

31


THANK YOU

32

National Department of Public Works (NDPW)

Head
Office: Public Works

CGO Building

Cnr

Bosman

and
Madiba

Pretoria Central

Private Bag

X65

Pretoria

0001

Website:
http://
www.publicworks.gov.za