REQUIRED
3.4 Key Factors for Success and Driving Forces
Generally, Council's throught South Africa find themselves in a precarious position with several factors contributing to its current financial position. The first task is to sift through the peripheral symptoms, thus, exposing the actual core issues. In so doing, municipalities can build and reflect on the key factors, which would contribute to their success, viz: -
Reconstruct or reorganize the organisation because we are victims of our structure.
Create a workplace environment that adheres to the Japanese ideology of work and moral ethics. This initiative can be achieved by encouraging a change in the perceptions of our staff, enhancement programs to build employee and employer confidence in their skills and highlight the role which these skills play in the overall service delivery and financial sustainability.
Marketing Competencies need to be developed to change the negative perception which consumers have of Council's, as well as grow the overall local economy. Municipalities should consider a possible market repositioning and shift the emphasis from a poor quality service provider to one that treats the entire market as a homogenous unit. A paradigm shift towards quality, safety and responsible management practices will have greater credence.
Being socially responsible by meeting societal expectations, exhibiting standard's of good community citizenship and abiding by sound ethics. At times it is not easy to balance societal and Council's ethics simultaneously, however, this needs to be addressed.
Municipalities would need to formulate a code of ethics (Credo).
The development of human capital is an important aspect to gain a strategic competitive advantage. Harnessing and developing the skills, which staff possesses are the only real core competencies, which will create a SCA and differentiate one municipality from another, as this facet is not easily replicated. Currently this important competency is marginalised and serious improvements in this regard must be addressed. Training workshops, on the job training, job rotation and job expansion all result in increased job satisfaction and productivity.
An innovative strategy that stresses technological development is an important factor, especially with people becoming more computer literate.
Strong Logistical Management - the ability to deliver the items required by the customer on time and correctly is very important.
The Key Success Factors (KSF) touched on above broadly outlines the requirements for financial and competitive success which are lacking at the Msunduzi Municipality. In developing these KSF, consideration must be given to the following factors: -
Product/service attributes that are crucial
Resources/capabilities required to compete successfully - a competent and dedicated workforce with skill and dexterity in service delivery
Requirements for sustainable competitive advantages - strong adherence to societal demands, well developed organizational structures, and the all-important human capital
Based on the premise that "strategy precedes structure" (moot point) the focus in crafting a winning strategy in light of the prevailing circumstances would require radical change to the structure of the municipality.
This type of strategy requires a redirection of resources within the organisation in order to stabilise the financial condition. This can take the form of cost reduction and/or asset reduction. In most cases, cost reduction coupled with enhanced revenue collection is required. According to Provincial and Local Government Department adviser Daniel Manyindo, "in about one third of SA's municipalities service debt is growing at a rate of greater than 20 % per year" (The Natal Witness, Echo, 06 March 2003)
Customer-centric strategy as compared to a product-centric strategy, (which pushes products to consumers), pulls information from consumers (demand driven) and results in improved service delivery and customise offerings. The municipality should formulate customer-centric strategies that respond to this new customer power.
According to Johnson.G & Scholls.K, in order to develop the financial capabilities to survive, strategies selected must be suitable, acceptable and feasible.
E-commerce is fundamentally changing the economy and the way business is conducted. E-commerce forces organisations to find new ways to expand the markets in which they compete, to attract and retain customers by tailoring products and services to their needs, and to restructure their business processes to deliver products and services more efficiently and effectively. E-businesses shift the focus towards building a customer base, increasing revenue growth and profitability .
To give further credence to the above, I see the role and responsibility of today's municipalities not merely as 'monitors' but also in a broader context as having the responsibility of providing/creating employment, nurturing and growing the environment(city) and as role players in driving the economy towards prosperity.
It should be noted that the municipality has limited financial resources available. In light of this constraint, there are three criteria that would need to be considered when allocating resources: -
1. The contribution of the proposed resources to achieving the organisation mission and objectives.
2. Their support of key strategies, viz, Support of core competencies Enhancement of the value chain
3. The level of risk associated with a specific allocation of resources.
There is an indication that there will be significant long-term demand, triggering growth for established companies and attracting newcomers who are in search of growth prospects. Lower labour costs, coupled with relatively attractive incentives offered by some local authorities reduce start-up costs and would enable the economy to expand.
Unfortunately, product/service innovation cannot be classified as a driving force as yet, since innovation has never reached beyond product/service variations. Over the years no breakthrough innovations in service delivery has been implemented.
Product/service innovation is exactly what the municipality needs in order to enable it to strengthen its market position, safe guard its competitive advantage and rejuvenate the local industry growth. Problems like these require a revision or change in current strategy.
Unfortunately, The Msunduzi Municipality, like most Counci1's have a poor service delivery stigma attached to it, which always lingers at the back of the mind of all consumers and therefore, they should strive to overcome this stigma by implementing turnaround strategies that are visible to consumers. This can be achieved by: -
Educating employees on the principles of CPM
Educating customers by making them more aware on how it does business
Educate consumers on what they should expect from this Council - Batho Pele