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The conference was preceded on the Sunday by a Golf Day at Erinvale Golf Course in Somerset West, sponsored by Barloworld Equipment. The winning team was a team representing CHI Control Components; Barloworld Equipment and Glenrand MIB.
and Political Journey into the Future
Investments – The Lift Off
He noted that the construction industry is operating at maximum capacity needing time to deliver with 15 to 17% real growth being led by the Government and Parastatals infrastructure programmes. He believes that they are building a base to allow the industry to grow at 8% for the next generation after 2010 with general unemployment continuing to decline.
new Era in Construction – Growth, Capacity and Innovation
Best practice in teamwork and innovation
He went on to state that this is in fact not an ideal but already exists and is the plan currently in place for the upcoming London Olympics. He contends that it is key that an enjoyable environment is created for people to work. The key is to get the balance between risk and potential for shareholders and it is crucial for the industry that risk is properly priced. ‘Profits are the rewards for successful risk taking,’ and noted that there is a worldwide trend to involve contractors earlier in the process.
Lomas noted that there is a huge amount of growth opportunity in South Africa with environmental concern a growing issue. He contends that 2010 is just a milestone along the way and that industry is set to grow way beyond 2010 and with all things being equal there should be at least another 10 to 15 years of growth. The industry needs to focus on Innovation by implementing: Best Practice; Off site manufacture; New production processes; Virtual prototyping for design and manufacturing; Environmentally sustainable construction; and Preferred employers. He also stated that the construction industry currently lags other industries with respect to Innovation.
Lomas states that risk management is crucial, with contractors racing to get work they must beware of overtrading, learn lessons from international risk management case studies and he strongly believes that South Africa should have a Construction Industry Vision and Strategy, “RSA 2015 - from Transformation to Innovation”.
Construction, Challenges and Opportunities
He stated that the corporate world is becoming more demanding on how it is performing on these issues although there is also a belief that, ‘The Sustainable building option conflicts with profit maximization’. However, van Wyk contests this and believes that there is a business case for sustainable construction as we are experiencing increased consumer demand, corporate social responsibility and legislation in this regard with a number of government departments focusing on sustainable issues. South Africa is one of the few countries that have set targets for energy efficiency improvements through the Department of Minerals and Energy (DME). Industry is going to be expected to deliver on the targets set with ESKOM already seeking to reduce electricity demand. The Green Building Council of SA was launched on the 19 September by SAPOA and the CIDB is currently working on a sustainable Construction Strategy as part of their broader strategy.
Van Wyk stated that the industry can expect legislation, regulation, codes, policies, guidelines, frameworks, manuals, performance standards, indicators, measurement, assessment and reports to be introduced in the near future. He stated that the various associations need to put guidelines in place to deal with the relevant issues and assist members to comply with requirements as they arise. “It is no longer a nice to have”, stated Graham Pirie, CEO of SAACE and chairman of the session.
Systems Don’t Work
– Thinking Outside the Box
Cecil Rose, President of SAACE closed the conference by thanking the speakers, participants, sponsors and exhibitors for their contribution to a very successful and thought-provoking conference.
Fongoqa, CEO of ILISO Consulting, graduated from the University of the Witwatersrand with a BSc Engineering degree in 1988 and a Graduate Diploma in Engineering in 1990. He has over the years worked for many highly reputable consulting engineering firms in the country. After moving to Gauteng in 2002 he served on various committees of SAACE in different capacities including the Young Professional’s Forum (YPF); Membership; Disciplinary; School of Consulting Engineering; Transformation; Marketing and Communications; and Finance and Staff. Fongoqa’s key engineering expertise is in the fields of water engineering and municipal infrastructure. He has also over the last couple of years, developed a passion for contract law.
Fongoqa’s involvement and service to the engineering industry goes back to his days at University where he served on the South African Institute of Civil Engineers (SAICE) student chapter at Wits, then as graduate representative of the Border-Kei branch of SAICE as well as on their national graduates committee. He has also served in various portfolios for the South African Black Technical and Allied Careers Organization (SABTACO). Fongoqa has over the years served on a number of boards and community-based development organizations including Amatola Water, Eastern Cape Provincial Housing Board, Mdantsane Community Development Trust and the Border-Kei Development Forum. He now serves on the Boards of ILISO Consulting (Pty) Ltd; PRDW (Pty) Ltd; and Bateman Africa (Pty) Ltd.
Fongoqa is married to Thandi, and has been blessed with 4 children aged 3 to 17 years old.
Zulch Lotter (UWP Consulting) has been appointed Deputy President.
As usual the conference was preceded by a meeting of directors of member associations attended by representatives of 24 countries. The main topic of this meeting centered around ‘Best Practice Association Management and the role of Directors. Topics included: Achieving the correct membership mix and service the needs of large and small firms; Marketing of the Association; and Fundraising. The directors were then joined by the Presidents of the Associations in order to share with them the many tools that FIDIC produces to assist Member Associations and firms as well as listen to the report back from FIDIC’s regional groupings including the Group of African Member Associations (GAMA). A point of interest is that coincidentally, many of the Associations have contemplated a name change to remain relevant in the current market economy as SAACE is currently in the process of doing. These changes in the main are to emphasise the business aspects of consulting engineering entities.
The theme of the conference was ‘Global Services – Enhanced Partnerships’ with most of the conference sessions being relevant to the overall theme, however a point of criticism is that there were too many presentations by International Finance Institutions (IFI’s) including the Asian Development Bank (ADB), World Bank and the Japanese Bank of International Co-operation. Apart from this, it was astounding to see the large number of essential tools that FIDIC produces to assist firms in the marketplace. These include policy statements, guideline documents and contracts including the newly created Design - Build – Operate Contract (Gold Book) that was launched via a dedicated one day workshop at the conference. Other guides currently under development include: Definition of Services Guide; Design Documentation Guidelines; and the Construction Monitoring Guide. SAACE strongly recommends a visit to the FIDIC website to find out what is available for order via SAACE. In addition, copies of all the conference presentations are also available at www.fidic.org/conference/2007/talks/.
It is interesting to note that most of the world is in a massive growth phase centered on infrastructure with the resultant supply/demand challenges. Lack of skills is the order of the day globally with the resultant problems relating to delivery as well as inadequate maintenance and upkeep of infrastructure. Central to this investment in the developing economies relates to infrastructure provision as a means of uplifting people out of poverty but the resultant environmental degradation threatens to reverse any gains. Hence the need to embrace the concept of sustainable development.
There was also a session devoted to sustainable construction, which globally is moving to centre stage, especially since 40% of energy related to green house gases are related to buildings. Many countries including South Africa have set up Green Building Councils to address these issues and create increased awareness.
The construction boom worldwide has also forced clients to accept new delivery mechanisms particularly what is termed ‘Relationship Contracting’ also known as ‘Alliancing “Turnkey” or Partnering’. Alliancing can also be considered, ‘Partnering for Profit’. It has become the method of choice in Australia and while it requires a better understanding of the risk/reward relationship, it represents a more flexible vehicle overcoming the negatives of purely price based competition and in dealing with an uninformed client base. In this regard the World Bank is still contemplating the role of Quality Based Selection (QBS) in their procurement methodology as a preferred mechanism to Quality and Cost Based Selection (QCBS) in the procurement of professional services. This is as a consequence of poor experience where quality played a secondary role to cost for services rendered.
It was stated at the conference that consulting engineering procurement methodologies should be embedded in a countries overall strategic innovation system and that brain drain is a consequence of the incorrect approach where solutions are chosen based purely on price. Best practice procurement methodologies recognizing VALUE, enhance country competitiveness and eliminate the tendency towards brain drain. It was noted that the consulting industry grows fastest in countries displaying a progressive knowledge economy. It is the role of the Consultant, the Association and the Government to develop and lead the agenda particularly where a weak institutional framework exists in the public sector. The Malaysian methodology relating to the selection and appointment of consultants was very impressive and it is considered as no coincidence that Malaysia is number 2 in the world rankings of competitiveness relating to government Procurement of Advanced Technology Products.
In short, it was demonstrated that there is a definite link between the use of QBS, a strong consulting industry. There were frequent references to the modus operandi of Management Consultants who have mastered the concept of selling solutions and value. Pirie comments that, “Perhaps we should learn from them rather than denigrating them”.
Once again SAACE’s Young Professional Forum (YPF) did South Africa proud at the conference. Khelane Ndwandwe was tasked with summarizing a plenary session and our own Young Engineer of the Year, Michele Kruger was nominated to the International YPF Executive, with Kieren Brown as her alternate.
Young Professionals Management Training Program 2007 participants holding their Certificates
discussions are continued right up to and including the days leading
up to the 2008 Annual Conference where participants and facilitators
meet in one of the conference hotels to finalize their discussions
and prepare for their “Future Leaders” presentation
at the conference.
Participants discuss their final presentation
Steen Frederiksen, Program facilitator
Future Leaders workshop
You can find
more information about the YPMTP08 on:
The International Business Development Section (IBDS) of the Association represented by Manager, Roelof van Tonder, recently embarked on a mission to Zambia and Tanzania with the costs of the visit covered by the DTI. Van Tonder comments, “The DTI must be commended for responding to inputs from the Export Community on how missions should be structured.” The successful mission focused on project opportunities in the utility and mining sectors of both countries. Van Tonder states, “The challenge for the IBDS is to convince member firms to look beyond the current domestic boom, and to participate in these missions with a view to securing work beyond 2010.”
Tanzania offers major opportunities to those consulting engineers that are serious about exporting their services into Africa. There are a number of reasons for this including:
Geographic proximity to South Africa
While South Africa has been introduced as a goods and services provider to Tanzania, it is clear that as a country, we have a long way to go before we can compete with foreign competitors who are very well organized, and enjoy substantial support from their governments to remain active in this market. For the utility portion of the visit the following are some comments about the clients visited:
Tanzania Electricity Supply Company (TANESCO) was our first client visited and they were interested to hear that members of the IBDS have access to a feasibility study fund at both the DTI and the International Finance Corporation who indicated that they are planning investments of more than USD 1 billion over the next 5 years or so.
Delegates also attended presentations by the Tanzanian Department of Minerals and Energy and the National Development Corporation. Both entities painted an impressive picture of infrastructure as well as the mineral and gas exploitation led expansion programme within the country. Of particular interest to the delegation was information provided on their Central and Mtwara Corridor Development programmes with substantial opportunities for port, rail, road, water and power projects.
The visit to the Tanzania Ports Authority (TPA) indicated that there is a lack of funding with regard to feasibility studies as well. Since Tanzania has three major freshwater bodies in addition to a number of ports on its coast, the TPA offers substantial opportunities for Engineers who are active in this arena. The TPA were, therefore, very interested in the fact that the DTI has a Feasibility Study Fund of its own and one with the World Bank’s IFC.
The Tanzania Roads Authority (Tanroads) gave the delegation a warm welcome with several senior officials attending the discussions including their Director of Projects and their Director of Procurement. Their message was similar to many of the client entities, in that they have major expansion plans, have access to the funds but lack engineering capacity to execute projects. Roelof van Tonder also met with a local consultant, NORPLAN. The meeting had two objectives, the first was to extend a courtesy call on Engineer Exaud Mushi in his capacity as MD of NORPLAN and as President of the Group of Africa Member Associations (GAMA), and secondly to find out more about local business conditions for Consulting Engineers. With regard to business conditions Mushi confirmed that the market is very active and that it is good to be an engineer in Tanzania.
While the IBDS did not participate in the mine visits it must be noted that all the mines are situated in the north western part of the country where there is insufficient supporting infrastructure and that there are many opportunities for Consulting Engineers. While many of them might have in-house capabilities to handle certain projects, they also make use of external service providers. According to the delegates who went on this part of the Mission they were well received at all the mines with firm interest in using South African service providers.
From a general procurement perspective it was interesting to note that in 2004 Tanzania created the Public Procurement Regulatory Authority (PPRA). It was explained that Tanzania is one of 22 countries that are participating in a pilot test of the international "Methodology for Assessment of National Procurement Systems". The purpose of the methodology is to provide a harmonized tool that developing countries can use to assess the quality and effectiveness of national procurement systems. Government/parastatal tenders can be viewed on this website (www.ppra.go.tz)
The visit to Zambia was very productive and in view of this the DTI has agreed to arrange for all key clients visited to come to South Africa utilizing one of the DTI’s incentive programs. The clients visited have agreed to improved collaboration on feasibility studies and information on future projects. The DTI has also approved financial support for firms who would like to participate in a major exhibition in the Copperbelt during May 2008.
A visit to the Zambia Electricity Supply Commission (ZESCO) revealed that they have a number of new generation projects in the pipeline and that they have created a new department to deal with these projects. Please consult their website www.zesco.co.zm for more information.
A visit to the Zambia Road Development Agency (RDA) confirmed that there is a lack of engineering capacity in the roads sector in general. The Chief Engineer: Design and the Chief Engineer: Bridges both confirmed that they are quite willing to share information regarding new projects. The requirement for local registration of all foreign engineers who wish to work in Zambia was discussed at length. In this regard the RDA confirmed that registration can take place within a month in most cases as the Engineers Registration Board meets on a monthly basis. The RDA confirmed that they are willing to assist and would be happy to point engineers in the right direction.
The Copperbelt Energy Corporation (CEC) is a private
company responsible for supplying energy to the Copperbelt mines.
The company draws supplies from ZESCO, Kafue and the DRC. The power
is then directed through CEC’s privately owned grid to all
the mines in the Copperbelt. Many opportunities to do business with
the CEC exist based on the fact that the CEC will be moving into
power generation in order to meet the expected 50% increase in energy
demand over the next five years.
While Zambia is well known for its copper production it should be noted that Zambia is the world's largest cobalt producer, supplying 20% of the world's cobalt. Zambia moved from the worlds 4th largest copper producer in the 70’s to the current 11th largest producer. Despite this decline, copper and cobalt mining still contributes 10% of Zambia's GDP, representing 80% of export earnings. It should be noted that there are also strong mining development across the border in the Southern DRC, which will be targeted for future missions.
Van Tonder enthuses that, “The DTI has already agreed to allow key decision makers to visit South Africa utilizing DTI incentive schemes, and to assist with follow-up visits to both Zambia and Tanzania before the end of next year.”
The question is often asked “What if I train my people, give them new skills and develop their competencies only to have them leave!” A simpler question is, “What if you don’t train them and they stay?” Simply put, incorrectly trained workers may learn on their own (and often from each other), perhaps incorrectly. According to the SAACE Management Information Survey (MIS), firms are spending more than 2.5% of their salary and wage bill on direct training costs. The rate of training has increased in the last six months of the year from 17% to 21% and this does not include the 1% CETA levy.
Companies that have a healthy training culture report many benefits which include: improved quality; increased productivity; greater flexibility and responsiveness to change; less wastage; greater staff commitment; higher staff retention rate and improved morale. Training does not only involve teaching someone to do their job more productively but it also facilitates the learning of softer skills such as networking with other colleagues in the industry, leadership and communication. We are all aware that the industry is thriving and some would say that there is limited or no time for training but there are critical reasons for providing ongoing focused training.
The most important factor is that all registered engineers have to renew their registration every 5 years with the Engineering Council of South Africa. In order to maintain registration they need to accumulate 25 credits which are obtained by participating in CPD courses and other activities. A minimum of 3 credits are required per year but additional credits can be carried over to the following years. In accordance with the Skills Development Act of 1998, every eligible employer in South Africa registered with SARS for PAYE is liable to register for the compulsory 1% levy contribution of the total employer payroll. An employer who makes an application will be refunded 50% of the total of the levies for training their workers. Employers should also submit training plans (WSP) and a consultation and training report (ATR) on a yearly basis.
Skills development is the best way to meet DTI BEE scorecard requirements (weighting is 20%), and it is the most efficient and cost effective technique in terms of strategic leveraging of skills development initiatives. The Construction Industry Charter once implemented, allows the skills development segment of the scorecard to focus on total training spend, skills and management training for black men and women, total learnerships, learnerships for black men and women as well as designated groups, bursaries for black people and on mentorship.
The School of Consulting Engineers (SCE) 2008 CPD Training Programme will provide cost effective training and will commence in February 2008. It will include short courses, seminars, workshops, and skills programmes designed to build a resource of holistic engineers and consultants. Topics are selected and courses are developed to meet the specific requirements of the industry. In addition to its standard courses, SCE offers in-house courses that are geared to the specific work needs. Our approach to training is of a practical nature, it is rich in visual stimuli and all courses have a high degree of participation. Our training is not only for consultants but for all who would like to attend. For more information please visit www.saace.co.za
Join the Dispute Resolution Board Foundation (DRBF) in Cape Town for the 8th Annual International Conference. The Conference to be held from the 2nd to the 4th of May 2008 will be of interest to all involved or interested in the practical dispute resolution both here in South Africa and elsewhere in the world. Co-sponsored by ICC, the programme is packed with informative sessions on the use of Dispute Boards throughout Africa and other regions, the Multinational Development Bank's perspective on dispute resolution, and interactive breakout sessions on the practical application of the process. The conference will span three mornings, leaving afternoons open for networking or exploring the many exciting attractions in the region. Saturday night's gala dinner will be held at Spier Wine Estate in Stellenbosch. A training workshop is planned in conjunction with the conference on 5 and 6th May 2008, which will focus on Dispute Boards under the FIDIC MDB Harmonised Conditions for Construction.
For more information please visit: http://www.drb.org/meetings_conferences.htm
Space for this conference is limited, so make your reservations today!
go to Faldi Samaai and his team from Western Cape on being awarded
Branch of the Year. Judging for this award is based on the effectiveness
of the branch committee structure; branch organization; and communication
with local members. The consistency and number of liaison meetings
is also a key factor. Attendance at SAACE Council/Branch meetings
as well as how well the Presidential visit is organized are other
aspects that are taken into account.
Cecil Rose, SAACE President congratulating Faldi Samaai, Chairman Western Cape Branch
BEPMEDS offers all of the ‘Lifestyle Benefits’ that larger medical schemes offer but has the advantage of being managed by professionals, for professionals focusing on the particular needs of the Consulting Industry.
The BEPMEDS Board of Trustees recently launched their 2008 rates and benefits after “Benefit Design” meetings held with members, brokers and employers. The scheme is pleased to report that it has made significant enhancements to areas of exposure that members had voiced concerns about during the past year.
Benefits for 2008 include significant annual increases across a wide range of benefits (i.e. specialized dentistry, prosthesis, oncology and threshold limits), spread across all the benefit options.
The scheme is confident that the rates and benefits for 2008 are still very competitive and in line with the industry. The Board of Trustees maintains that BEPMEDS is a scheme aligned for professionals who have, by way of claims experience, demonstrated the benefit areas that they require assistance in.
BEPMEDS members also have access to a Lifestyle Programme called MULTIPLY and automatic access to an International Medical Travel Benefit through Netcare 911.
The trustees of BEPMEDS will continue looking at new and innovative ways of keeping members satisfied while growing the scheme to be a dominant player in the built environment arena.
Zulch Lotter, Managing Director, UWP Consulting, comments, "We have given our staff the choice of joining BEPMEDS or other schemes and we have noticed that staff are freely joining BEPMEDS based on their high service levels and value for money. From 2008, all new staff members will be joining BEPMEDS as the scheme is tailored to suit the specific requirements of our business."
Francois Swart, CEO, Bigen Africa, states, "Bigen Africa is proud to have been a member of BEPMEDS since it's inception. Managers continually receive positive feedback from our staff on the excellent service received, as well as the level of benefits provided at rates that are considerably lower than most of the open schemes. BEPMEDS with its affordable rates allows us to structure competitive packages when recruiting staff. The lifestyle benefits provided in the form of gym memberships etc., are as good, if not better than any lifestyle benefits currently on offer."
Arthur Taute, Managing Director Vela VKE, comments, "BEPMEDS has proved to be good value for money with service levels equal to other medical aids." He also believes that Consultants should support BEPMEDS in order to counter monopolistic practices in the medical aid industry.
Gerhard du Plessis, THM Engineers, Eastern Cape states, “The most important factor for employer and employee alike are that BEPMEDS is very affordable and offers excellent benefits, it has been our company’s experience that if any queries or issues arise, they are dealt with efficiently, timeously and professionally. We have no hesitation in recommending BEPMEDS and will remain a loyal supporter of the scheme.”
For more information contact Eugene Eakduth, the Fund Manager on Tel: 031 573 4336 or email him on email@example.com
JOB SHADOW DAY WINNER CONGRATULATED AT SAACE AGM
Cecil Rose congratulating David Madisa of the BKS Group, winners of the SAACE YPF Job Shadow Day competition.