joburg market (soc) ltd company registration no: 2000 ... market 2018-1… · • section 2...

JOBURG MARKET (SOC) LTD

Company Registration No: 2000/023383/07

BUSINESS PLAN

2018/2019

Strategic Renewal of JM

A new Wave towards 2021

Presented in terms of section 87 of the Municipal Finance Management Act, 56 of 2003

Version 1.3

Joburg Market 2018/2019 Business Plan

of 97

Sign off – JM Management / Board / MMC: ED

Charles Hamilton

___________________

Signature

Executive: Strategy & Transformation (Acting)

Date of Approval

Sifiso Dlamini ___________________

Signature

Chief Financial Officer

Date of Approval

Ayanda Kanana ___________________

Signature

Chief Executive Officer

Date of Approval

Doris Dondur _____________________

Signature

Chairperson of the Board

Date of Approval

Cllr. Leah Ruth Knott _____________________

Signature

MMC: Economic Development

Date of Approval


of 97

EXECUTIVE SUMMARY

The Business Plan is linked to the JM 5 – year Strategic Plan and is primarily a planning

and communication document designed to integrate business strategic intent and business

imperatives. The plan seeks to set out the short term strategic plan of the Company for the

period 2018/2019, and becomes the springboard for the medium to long term planning for the

outer years.

The document also outlines Joburg Market (JM)’s new vision for the future and details the

manner in which JM intends transforming itself through an active process of Strategic

Business Renewal (SBR)

The JM strategy is designed to support the City of Johannesburg (CoJ) Integrated

Developmental Plan (IDP) which contains 2018/19 Delivery Agenda (Diphetogo).

The strategic objectives have been mapped back into particular Divisional Operational

Plans, with Key Performance Areas (KPAs), from which specific Key Performance

Indicators (KPIs) were developed. The KPIs will form part of individual employees’

performance compacts.

The linking of business plan goals, strategies, desired performance and action plans within

the context of the Performance Management system will provide the framework for

determining the net business impact for any business intervention. The business plan will

therefore become a support tool for all levels of personnel when determining the impact

of non-achievement of strategic intent and any corrective action through to personnel

performance management. As a result the plan needs regular revision via an approved

business planning process to communicate the business.

The business plan is divided into different sections in line with CoJ’s Group Governance

requirements and guidelines. The structure of the FY2018/2019 Business Plan is as follows:

• Section 1 provides an introduction which includes a descript ion of how JM

relates to its Shareholder and the context to the strategic plan. It reviews the

historical background of the Company, business challenges that the Company faced,

and the strategic response from the leadership to redirect and redefine the direction

of the Company;

• Section 2 describes the Company’s macro and micro environments analysis. It

provides an overview of JM in general and the nature of the business environment

within which it operates;

• Section 3 def ines and outlines the strategic alignment to the IDP, SDBIP, budget,

and the business plan of the City.

• Section 4 presents the JM Risk Register, which was developed in conjunction with

various stakeholders and highlights the key challenges and potential risks that the

organisation could have;

• Section 5 presents organisational Financial Plan for FY 2018/19 and the deployment


of 97

of financial resources to achieve organisational goals, objectives and programmes;

• Section 6 presents the Organisational Structure and the alignment to strategic delivery

imperatives;

• Section 7 presents Human Capital Management Plan, it outlines key programmes that

JM will implement to ensure the realisation of well-trained, motivated and dedicated

employees;

• Annexures are included to provide additional information to key sections.


of 97

Table of Contents

1. INTRODUCTION ............................................................................................................... 9

1.1 Purpose of the JM Business Plan .................................................................................... 9

1.2 Company Synopsis ....................................................................................................... 10

1.3 Shareholder Compact ................................................................................................... 11

1.4 Shareholder Objectives ................................................................................................. 11

1.5 Economic Cluster Priorities ........................................................................................... 12

1.6 Joburg Market Company Profile .................................................................................... 12

1.6.1 Background/History .................................................................................................... 12

1.6.2 Joburg Market Strategy Overview .............................................................................. 13

1.6.3 Strategic Objectives ................................................................................................... 13

1.6.4 Strategic Objectives ................................................................................................... 14

1.6.5 Strategic Priorities ...................................................................................................... 14

1.6.6 Capability Statement .................................................................................................. 15

1.6.6.1 Facilities .................................................................................................................. 15

1.6.6.2 Core Competencies................................................................................................. 15

1.6.7 Key assumptions ........................................................................................................ 16

2. STRATEGIC ANALYSIS ................................................................................................. 16

2.1 Reflection on Value for Money Market Services ............................................................ 17

2.1.1 Transformation within the fresh produce market contexct ........................................... 19

2.1.2 Challenges encountered in the previous financial year ............................................... 19

2.2.2 Contextual Analysis .................................................................................................... 20

2.2.3 PESTEL Analysis ....................................................................................................... 21

2.2.4SWOT Analysis ........................................................................................................... 23

3.2018/19 IMPLEMENTATION AND PERFORMANCE OVERVIEW ................................... 24

3.1 Measurable programmes ............................................................................................... 24

3.2 Projects Aligned To Priorities ........................................................................................ 25

3.2.1 Company objectives aligned to CoJ priorities and Dipethogo ..................................... 25

3.2.2 Contribution to the Economic Growth Cluster ............................................................. 26

3.3 Key Shareholder Programmes ...................................................................................... 28

3.3.1 Work creation programmes ........................................................................................ 28

3.3.2 Green economy initiatives .......................................................................................... 28

3.3.3 Communication and Stakeholder Engagement ........................................................... 29

3.3.4 Day to day action ........................................................................................................ 30

4.GOVERNANCE IN ALIGNMENT TO KING IV .................................................................. 31

4.1 Joburg Market Strategic Risks 2018/19 ......................................................................... 31


of 97

4.2 Internal Audit ............................................................................................................... 33

5 FINANCIAL MANAGEMENT ........................................................................................... 33

5.1 Fixed Asset Controls and Insurance ......................................................................... 34

5.2 Supply Chain Management......................................................................................... 34

5.3 Cashiering.................................................................................................................... 34

5.4 Budget 2018/19 ............................................................................................................ 34

5.4.1 Overview ................................................................................................................... 34

5.5.1 Finance Key Priorities ................................................................................. 35

5.5.2 Income Statement and Commission revenue ............................................ 35

5.5.3 Core and Rental Revenue ............................................................................ 36

5.5.4 Total Revenue/total Expenses .................................................................... 36

5.6 Operational Expenditure .................................................................................... 38

5.6.1 Personnel Costs .......................................................................................... 38

5.6.2 Other Operating Expenditure ...................................................................... 39

5.6.3 Surplus ......................................................................................................... 39

5.6.4 Expenditure Medium Term Budget for 2015/16 – 2018/19 Financial years .... 39

5.7 Capital Projects ................................................................................................... 41

5.7.1 Source of Funding ....................................................................................... 42

6 Organisational Structure ........................................................................................... 43

6.1 Office of the CEO ........................................................................................... 43

6.2 Strategy and Transformation .......................................................................... 44

6.3 Agri - business ............................................................................................... 46

6.4 Core Operations ............................................................................................ 47

6.5 Human Resources and Compliance ............................................................... 48

6.6 Finance .......................................................................................................... 50

7. Human Resource Management Plan ..................................................................... 51

7.1 Human Resource Development (HRD) .............................................................. 53

7.1.1 Skills Priorities for JM ................................................................................. 54

7.1.2 Employment Equity ......................................................................................... 56

ANNEXURE 1: JM 2018/19 SCORECARD ......................................................................... 57

ANNEXURE 2: CROSS CUTTING ACTIVITIES .................................................................. 66

ANNEXURE 3: EXECUTIVE MANAGEMENT TEAM .......................................................... 69

ANNEXURE 4: SERVICE DELIVERY AGREEMENT BETWEEN THE COJ & COMPANY . 73

ANNEXURE 5: ORGANISATIONAL STRATEGIC RISK REGISTER ........................... 74

ANNEXURE 6: STAKEHOLDER ENGAGEMENT STRATEGY AND PLAN ................... 83


of 97

Glossary of Terms

APAC Agricultural Produce Agents Council REMCO Human Resources and

Remuneration Committee

BBBEE Broad Based Black Economic

Empowerment RSA Republic of South Africa

BEE Black Economic Empowerment SADC Southern African Development

Community

CAPEX Capital Expenditure SANAS South African National

Accreditation System

CASP Comprehensive Agricultural Support

Programme SAUFM

South African Union of Food

Markets

CB Commission Business SCM Supply Chain Management

CEO Chief Executive Officer SDBIP Service Delivery and Budget

Implementation Plan

CFO Chief Financial Officer SEDA Small Enterprise Development

Agency

CoJ City of Johannesburg SETA Sector Education Training

Authority

SHE Safety, Health & Environment

CPI Consumer Price Index SHU Shareholder Unit

CSI Corporate Social Investment SLA Service Level Agreement

DED Department of Economic

Development SMME

Small Medium and Micro

Enterprise

EE Employment Equity SPS Sales Processing System

EPWP Expanded Public Works Programme TG Targeted Groups

EXCO Executive Committee UNISA University of South Africa

FPM Fruit Produce Market W&R Wholesale and Retail

GAP Good Agricultural Practises WITS University of the Witwatersrand

GDAR

D

Gauteng Department of Agriculture

and Rural Development WUWM

World Union of Wholesale

Markets

GDED Gauteng Department of Economic

Development YARD

Youth in Agriculture and Rural

Development

GDS Growth and Development Strategy

GIBS Gordon Institute of Business Science

GRAP Generally Recognised Accounting

Practices

HACCP Hazard Analysis and Critical Control

Points

HIV/AI

DS

Human Immunodeficiency Virus

Infection / Acquired

Immunodeficiency Syndrome

HR Human Resources

HRCOS

A

Human Resource Council of South

Africa

HRD Human Resource Development

HSD Health and Social Department


of 97

IDC Industrial Development Corporation

IDP Integrated Development Plan

ILGM Institute of Local Government

Managers

IoD Institute of Directors

IT Information Technology

JM Joburg Market

JMPD Johannesburg Metropolitan Police

Department

JPC Johannesburg Property Company

LLF Local Labour Forum

LSM Living Standards Measure

MANC

O Management Committee

ME Municipal Entity

MFMA Municipal Finance Management Act

MMC Member of the Mayoral Committee

MotF Market of the Future

MOU Memorandum of Understanding

MSA Municipal Systems Act

NAFU National African Farmers Union

NAMC National Agricultural Marketing

Council

NGO Non-Governmental Organisation

OH&S Occupational Health and Safety

OPCAR Operation Clean Audit Report

OPEX Operational Expenditure

PDA Public Development Authority

PLWD People Living with Disabilities

PMA Produce Marketing Association of

America

PMO Project Management Office


of 97

1. INTRODUCTION

1.1 Purpose of the JM Business Plan

The purpose of this Business Plan is to lay out the strategic and operational direction of the

JM and to capture the necessary strategic, financial, and operational and resource plans

to support this direction. As such, the document becomes an engagement document for

discussion with JM stakeholders. The plan covers the financial period from 1 July 2018 to

30 June 2019, with a focus on step-change, transformational performance during the year.

The plan will be reviewed in line with the requirements of the CoJ Business Planning and

Review Cycles. A secondary purpose of the plan is to ensure compliance to the requirements

of the Municipal Finance Management Act (MFMA) 56 of 2003, National Treasury

regulations, and to support strategic national, provincial, CoJ and internal Company policies.

JM has selected in principal the strategic thrust towards becoming a SMART market. Being

a SMART market will entail the implementation of a number of technologies which will enable

the functionality depicted in the illustration below:

JM has identified a number of strategic windows to pursue within which the development of

the various SMART market concepts may be deployed.


of 97

1.2 Company Synopsis

The JM renders a series of services and provides amenities which facilitates the trading of

fresh produce. On a daily basis, approximately 11,000 buyers trade at the JM. In addition

approximately 6,000 producers are marketing their produce through the JM.

In FY 2017/18 the JM projects to achieve an operational income of R438m and an operating

surplus of R65m after taxation.

JM currently employs 328 individuals in six divisions namely; Finance, Strategy and

Transformation, Agri-business, Core Operations and Compliance and Human Resources.

The strategic programmes and projects embedded in the business plan are as follows:

Investment in infrastructure – R1.2 billion infrastructure spend by 2022

Investment in creating expertise

Creating trading space for primary and secondary fresh

produce business growth

Sales Halls extensions and vacant land usage

Delivering dignity and support SMME growth

Mandela Market Prcinct

Building JM as regional market and creating jobs

Export and Entrepreneur support centre

Innovation through ICT applications, WIFI & RFID

backbone support

Sales Halls extensions-vacant land usage

Delivering BEE and support &

growth in farming

Urban Farming

Taking hands towards development

Industry Round Tables

Strategic windows of opportunity towards 2021/22


of 97

Transformation at farm levels through targeted programmes and incentives

Maximize revenue to turnover R10 billion per annum by 2022

Good governance

1.3 Shareholder Compact

The shareholder compact/ service delivery agreements governs the relationship between the

CoJ as the Shareholder and the JM as an entity.

1.4 Shareholder Objectives

JM strives to ensure that strategic objectives are aligned with the broader development

objectives across the three spheres of government and the following policy documents:

National Development Plan (NDP) 2030;

CoJ Growth and Development Strategy 2040;

Integrated Development Plan (IDP) 2017/18 to 2020/21;

Service Delivery and Budget Implementation Plan (SDBIP) 2018/19; and

CoJ: key performance indicators that are standard and compulsory for all

departments and entities.

The new strategic thrust of the CoJ has the following components:

Vision

“A Joburg that works is a South Africa that works”.

Mission

To create an enabling economic environment by making Joburg more responsive in the

delivery of quality services.

Strategic Outcomes:

Outcome 1: A growing, diverse and competitive economy that creates jobs

Outcome 2: An inclusive society with enhanced quality of life that provides

meaningful redress through pro-poor development

Outcome 3: Enhanced, quality services and sustainable environmental practices

Outcome 5: Caring, safe and secure communities

Outcome 6: An honest, transparent and responsive local government that prides

itself on service excellence

Mayoral Priorities


of 97

Priority 1: Promote economic development and attract investment towards

achieving 5% economic growth that reduces unemployment by 2021.

Priority 2: Ensure pro-poor development that addresses inequality and poverty

and provides meaningful redress.

Priority 3: Create a culture of enhanced service delivery with pride.

Priority 4: Create a sense of security through improved public safety.

Priority 5 Create an honest and transparent City that fights corruption.

Priority 6: Create a City that responds to the needs of citizens, customers,

stakeholders and businesses.

Priority 7: Enhance our financial sustainability.

Priority 8: Encourage innovation and efficiency through the Smart City

programme.

Priority 9: Preserve our resources for future generations.

1.5 Economic Cluster Priorities

JM is supporting the Economic Growth Cluster mainly through the economic objectives of

the IDP priorities and GDS outcomes, namely:

Support the alignment of City plans and policies towards achieving a 5% economic

growth rate and to bringing down unemployment to less than 20% by 2021.

Support and promote the development of Small Medium Micro Enterprises (SMMEs).

Facilitate the creation of an enabling environment that attracts investment and provide

dedicated incentive packages for investors, with a focus on the Inner City.

Entrenching Johannesburg as a leading tourism destination brand in collaboration with

key stakeholders.

Enhanced collaboration with public and private sector stakeholders.

Ensure business regulation, compliance and enforcement of the informal trade sector.

1.6 Joburg Market Company Profile

The JM Company profile is set out below.

1.6.1 Background/History

JM was established in 1893 as a fresh produce market situated at the Market Square in central

Johannesburg, where three thousand people congregated to trade in fresh produce. The

economic boom emanating from the Gold Rush era resulted in the rapid growth of the City

and subsequently the trading of fresh produce. To accommodate growth, new facilities were

built around Newtown (Johannesburg) in 1913.


of 97

As trading increased over the years, the Newtown premises relocated to the current 64 hectare

site in City Deep. The Company which is 100% owned by the CoJ Metropolitan Municipality

operates on a commission-based business model where producers deliver their produce to

market agents who in turn sell to buyers.

The Company has operated in the City Deep trading hub since 1973. This facility has

generated substantial revenue for the City and continues to do so daily, with a growing export

arm within the SADC region. The facility is starting to show signs of decay and the trading floor

space has become insufficient. The entity has not kept up with the growing demands of the

industry and this business plan will demonstrate how the strategy aims to refocus and

transform the Market to ensure its sustainability and relevance as a source of food and key

contributor to Food Security.

1.6.2 Joburg Market Strategy Overview

The key elements of the JM Strategy are captured below;

Mandate

The Company is mandated to manage and operate a market facility through the provision of

premier quality facilities and complementary services to the fresh produce industry. This will

include the following;

Provision and management of profitable facilities and services for the distribution of

fresh produce;

Ensuring a competitive trading platform for fresh produce trading;

Enabling market access, sustainable availability and affordable fresh produce and,

Ensuring food safety and quality standards thus promoting healthy lifestyles.

Vision

A smart fresh produce trading hub that is globally competitive

Mission

Building a trading complex that catalyses the growth of the City’s economy through an

inclusive business environment

Values

The values of the Joburg Market are the following;

Transparency

Service excellence

Integrity

Innovation

1.6.3 Strategic Objectives


of 97

JM pursues five long term goals which are listed below and linked with the CoJ Priorities

set by the shareholder for 2018/19:

No KPA CoJ Priorities Diphetogo principles

1 Strategic deliverable 1 – Investment in infrastructure – R1.2 billion infrastructure spend by 202122

CoJ Priority 1 - Promote economic development and attract investment towards achieving 5% economic growth that reduces unemployment by 2021. CoJ Priority 2 - Ensure pro-poor development that addresses inequality and poverty and provides meaningful redress.

Economic Development Pillar: The significant improvement in the ease and experience of doing business in the City

2 Strategic deliverable 2 – Investment in creating expertise



3 Strategic deliverable 3 – Transformation at farm levels through targeted programmes and incentives

CoJ Priority 6 - Ensure pro-poor development that addresses inequality and poverty and provides meaningful redress.

Economic Development Pillar: Increasing the number of SMMEs as suppliers to the City

4 Strategic deliverable 4 – Maximize revenue turnover to R10 billion per annum by 2022

CoJ Priority 7 - Enhance our financial sustainability.-

Finance Pillar: Increase in the collection of revenue to increase funding to City projects

5 Strategic deliverable 5 – Good governance

CoJ Priority 5 - Create an honest and transparent City that fights corruption

Institutional Review Pillar: The structural realignment of the organisation to strategic direction of the administration

1.6.4 Strategic Objectives

In order to contribute towards the achievement of the objectives of the City, Joburg Market

has adopted the following strategic objectives:

Ensure financial sustainability and growth of the entity;

Operate a sustainable resilient premier marketing and trading facility;

Become an agent for socio-economic transformation;

Ensure that our staff are engaged, skilled and motivated

Become a high-performance organisation;

Ensure effective stakeholder engagement.

1.6.5 Strategic Priorities


of 97

JM has adopted a strategy based on achieving key organisational priorities on the basis of

“SMARTNESS” that are aligned to the development objectives of CoJ. They are:

A Clean market place:

o Physical cleanliness and Fabric of facilities

o “Clean Administration”

A Safe market place:

o Security

o OH&S

o Chemical usage/residues & Food safety

o Operating practices

A Market place that is efficient in its systems and services

o Floor space & amenities

o Cold stores and ripening

o Logistics

o IT technology and SMART systems

1.6.6 Capability Statement

JM provides trading facilities and complementary services in order to facilitate the trading of

fresh fruit and vegetables. Whilst this market is being operated in a matured distribution

channel it has the capacity to conduct strategic renewal which will render it a globally

competitive trading hub.

As outlined under Section 1.1 above the introduction of SMART Market technologies will

enable the company to roll out projects and programmes fit for the next generation market

operations. JM has the capacity to implement through its new management team the required

interventions.

1.6.6.1 Facilities

Trade takes place in three Food hubs, namely: Fruit Hub, Potato and Onion Hub and

Vegetable Hub, measuring a total of 75 000m² via a commission system. The Market charges

the producers a 5% commission on all sales concluded on the trading floor. A further

negotiable commission of 7.5% is paid to Market Agents for selling produce on behalf of the

farmer.

JM also provides cold storage services to ensure compliant preservation of large volumes of

produce which is required to be kept within the logistical cold chain. Premises are also being

leased to food related enterprises serving as a complementary feature in serving the

requirements of the thousands of buyers visiting the JM site daily.

1.6.6.2 Core Competencies

JM currently holds substantial expertise to enable the high level of services it renders. These

include


of 97

o Financial services,

o Engineering expertise,

o Human resources support,

o Strategic services,

o Risk services,

o Trading and consignment regulation services,

o ICT Systems (SPS),

o Facility management and property administration, and

o SANAS accredited laboratory and food quality and safety inspection service.

1.6.7 Key assumptions

In developing its strategy for 2018/19 JM considered inter alia the following key assumptions

relative to the realities of the macro environment;

It is projected that the population of the City could increase to about 5.43 million in mid-

2021 (Source GSPCR)

It is envisaged that the turnover growth in the next 3 – 5 years would be around 8.6%

per annum

The impact of the drought on the Joburg Market revenue is expected to be minimal in

the next 18 months as ‘La-Nina’ weather conditions are likely to replace the dry cycle

caused by the ‘El-Nino’ weather pattern

The labour environment will be relatively stable

All strategic projects will be funded to ensure execution

Main stream businesses in the food industry will be characterised by formation of

significant BEE partnerships

Competition by direct marketing channel operators will increase

Food inflation will continue to rise above headline inflation

Operating costs of suppliers of fresh produce, service providers to JM and utility

services will increase substantially

2. STRATEGIC ANALYSIS

As part of its recent strategic planning sessions JM invited stakeholders to engage with the

company to ascertain in the current day context what stakeholders are expecting from the

services being rendered by JM.

Two critically important concepts were identified which can be listed as follows.

Firstly quality Market services that should be regarded as Value for Money Market Services

and secondly Transformation within the Market system.


of 97

2.1 Reflection on Value for Money Market Services

The producer of fresh produce has at his/her disposal a number of competing marketing

channels through which fresh fruit and –vegetables can be channeled to the end user and

consumer.

It is however important to distinguish between these channels. In cases of direct marketing

where distribution is not being conducted through the municipal fresh produce market certain

features of these transactions are important to note. Direct marketers would normally take only

certain portions of a producer’s harvest, i.e. only certain sizes, grades etc. at a fixed price

negotiated before delivery. Most often the buyer would require credit terms, promotional

contributions, store returns, etc.

Conversely the municipal fresh produce market will always be accepting produce emanating

from the entire crop. The latter obviously includes all grades and sizes and quantities of fresh

produce. In this case the prices are not predetermined and consequently the producer is

utilizing what is pretty much referred to as spot market trading. A sound trading environment

with proper controls – checks and balances – are thus needed as the price of the produce is

yet to be discovered through the principles of supply and demand. From this perspective

Joburg Market become known as the Stock Exchange for Fresh Produce. In the South African

situation, local authorities serves as regulator of trading through its central IT trading systems

and the application of trading rules through a bylaw. In this is transparency and the

accountability of trading agents has created trust within the ranks of market users and farmers

whom especially prefer the protection municipal markets offer in this regard. The Market

Manager serves as referee in disputes and provides both the farmer/buyer and other users as

an avenue for dealing with queries which are resolved within the application of administrative

justice principles through the market bylaws and associated trading rules.

At this juncture it is also important to consider the cost of marketing produce through a fresh

produce market. It is important to note that nor does the market or the market agent take

ownership of produce. The market authority facilitates the trading and handling of produce for

which the farmer will remunerate the market through the payment of a market due or market

commission. The farmer will compensate the agent for trading the produce on his/her behalf

through an agent’s commission. The history of the commission levels come over many

decades, however for the purposes of this discussion it will suffice to explain two important

periods. Prior to 1992 when the Fresh Produce Industry was deregulated markets were

allowed to collect an ad valorem market due on the gross value of each consignment sold.The

market agent in turn was permitted the collection of a 7.5% agent’s commission for services

rendered. Farmers would pay in total a maximum of 12.5% to conduct marketing through a

municipal market. The deregulation alluded to brought about a slightly new dispensation.

Commission rates were no longer regulated and it was agreed that market agents may

privately negotiate with their suppliers a commission rate. Market authorities indicated that

they would continue to determine market dues within the framework of their municipal budget

systems. In practice the market due remained unchanged and only the introduction of Value

Added Tax by central government became a feature of this charge.

Over many years the question regularly arose as to what value for money the producer is

getting for the 5% market due paid by him/her?


of 97

The nature of the fresh produce market was discussed above and against that backdrop the

‘value for money services’ is now discussed. Markets must provide certainty and thus

accountable trading systems.

- The central trading system of the market is a sophisticated purposed designed

electronic trading methodology. Every element of the consignment is captured and

managed through this system and consequently is every function performed by the

agent and the market authority in real time mode.

- The market authority conducts a dedicated financial accounting service inclusive of a

cashiering system linked to a trust account system which enables the payment of

proceeds on every consignment the following working day. This is the fasted payment

system in the industry and offers multiple advantages to producers.

- Protection of the farmer is further embedded in the assurance systems which enable

traceability to determine whether fair prices were achieved and utmost care was taken

by the agent in dealing with what the farmer entrusted to the agent.

Firstly consignment control ensures that each and every consignment to its finest details was

accurately captured and traded through the system. This enables a trustworthy trading history

and return for the farmer.

Laboratory and inspection services ensure that the farmer do not suffer undue losses of stock,

etc. Joburg Market has invested in the development of a SANAS accredited laboratory.

Produce discarded are being dealt with in scientifically sound practices and suitable audit trail.

Producers and agents are not charged additionally fees for the disposal of written off produce.

Dispute resolution is conducted and the Market Director (CEO) may order compensation of

an aggrieved party. Transgressions by market agents are also being dealt with through this

avenue.

- Cleansing and sanitization of the market facilities ensures a safe food center serving

both the supply and demand side of market clients.

- Physical security services supported by a most modern and extended CCTV system

ensures protection of the entire market facility serving farmers especially overnight

when their consignments are delivered to the market.

- Cold stores and ripening facilities are maintained and upgraded to ensure the

availability of these vital support services to farmers and their agents.

- Marketing services and agri-business support services are conducted to inform

farmers and attract buyers to the market to ensure a vibrant market place to the

advantage of producers.

This also includes the dissemination of market trading results on which South African

Producers can always rely.

Over many years producers articulated their requirements from market authorities as follows:

“Fresh produce markets should be clean, safe and efficient in their systems serving the

producer of fresh produce”.


of 97

In our quest to achieve that Joburg Market manages and invest in achieving the value for

money services it renders. The key value for money services were briefly discussed above.

2.1.1 Transformation within the fresh produce market contexts

Transformation will entail the following:

Change management

To implement a multi phased approach to enable organizational change relevant to

the transformation objectives set for JM

Targeted procurement processes

Increase the share of targeted beneficiaries (women, youth & disabled) in rendering

goods and services to JM through its SCM system

Sustain Black agents (Current emerging agents)

Introduce support measures to sustain emerging agents

Increase the number of Black agents

Utilize a new standard policy to canvass candidates with the view to establish new

agents from targeted groups as beneficiaries

Access for Black farmers to JM support programmes

Enable greater access for emerging farmers (including women, youth & disabled) for

trading their cultivated produce at JM

2.1.2 Challenges encountered in the previous financial year

A number of challenges were faced during the financial year:

JM faced a number of challenges which includes

- Core business shortfalls pertaining to the following:

o Project and programme implementation failure

o Legal and legislative noncompliance

o Business interruptions as a result of standby power plant failures

o Leadership underperformance

o Critical shortage of trading space

During its strategic breakaway the Board of Directors considered these challenges and

accepted the principle of EXCO developing its resolutions along the concept of an

implementation Lekgotla which is aimed at resolving the mentioned challenges.1 Industry

Trend

s


of 97

2.2.2 Contextual Analysis

The South African agricultural sector is composed of three main industries namely field crops,

horticulture and animal production. All form part of the global economy through amongst

others; their significant contribution to earnings of foreign exchange. According to the

Department of Agriculture Forestry and Fisheries (DAFF, 2017), the gross value of agricultural

production was R263, 2 billion in 2016/17. During the same period, the agricultural industry

trends analysis shows that the horticultural sector, from which the JM generates its revenue,

was valued at R72.2 billion. The deciduous industry generated R20 billion, compared to R16.2

billion in 2015/16. The citrus industry generated R14.8 billion, compared to R12.6 billion in

2015/16. Subtropical fruit industry generated a gross value of R4.3 billion, compared to R3.8

billion in 2015/16 trading season. The vegetables sector inclusive of potatoes generated R21

billion, compared to R17 billion in 2015/16 trading period. All sectors experienced growth in

revenue generated in 2016/17 when compared to its performance in 2015/16.

The Joburg Market remains a key player in the horticultural industry trade. . During the 2016/17

trading year the JM traded more than 1.3 million metric tons of fresh produce and generated

R6.7 billion in revenue. The market serves as a trading platform for fresh produce destined to

both the local and international markets, particularly the South African Development

Community (SADC) region. However, considering the Free Trade Area (FTA) agreement

ratified by African member countries in Rwanda during the 2018 phase 1 negotiation, once

the FTA is fully implemented the JM is poised to expand its customer base and increase its

produce destination beyond the SADC region..

In addition to its trade with the rest of the African continent and to a limited extent with

developed countries of the world, the JM business is directly impacted on by various economic

factors and other agribusiness industry trends. Forming part of these developments and trends

which are key features of the industry are:

Growth of the middle class which is estimated at 5.6 million in South Africa with about

52% of the people residing in Gauteng (Simpson, 2016). This will result in concomitant

rise in demand for meat products and other value added products such as precooked

vegetables, fruit and vegetables based beverages Growth in middle class and

migration of rural population to urban areas - urban population accounts for 64% (29

million) of the total population (56 million), fuelling demand for food products in urban

areas where demand exceeds urban areas primary production output.

Population growth which is estimated at 1.2 billion in Africa and associated rise in food

demand.

Increasing demand for convenient, processed and healthy foods, influenced by a rise

in people who are becoming sophisticated and health conscious.

Increased production and productivity to reach better economies of scale attributed to

amongst others; advancement in irrigation systems, adoption of biotechnology.

Such as high yielding cultivars and synthetic fertiliser use.

Decline in subsistence production of food and increase commercial production and

demand for purchased food

Constrained limited natural production resources (particularly water and productive

land), posing a threat on food security


of 97

Increase in demand for certain food types, particularly animal products in SA and

certain horticultural products in Africa.

Price increases of production inputs, especially fuel, fertilizers, pesticides and labour.

Possible reduction in the farming activities due to uncertainties around talks of land

expropriation without compensation which might as well lower investor confidence

Appreciation of the Rand, which if sustained is likely to result in reduced costs of

imported production inputs, implements and machinery, however diminishing

competitiveness of exporting industries.

A decline in the job opportunities in the agricultural sector mainly due to closing down

of farming enterprises and the sector becoming more capital intensive for

competitiveness reasons.

Incidence of foodborne diseases such as listeriosis, reported to be in part caused by

poor compliance to food safety protocols by food processing facilities. .

In line with outcomes of Operation Phakisa on Agriculture, Rural Development and Land

Reform, the Department of Agriculture Forestry and Fisheries (DAFF) was allocated R581.7

million by the National Treasury to create and support 450 sustainable and profitable black

commercial farmers in prioritised value chain for the period of five years, 2017/18. It is

expected that the JM will be part of these initiatives by absorbing some of the fresh produce

that are destined to the markets.

The South African economy is valued at R3.4 trillion or 295 billion USD in terms of nominal

Gross Domestic Product (GDP). The economy grew by 1.3% % in 2017 as compared with

2016 where an overall economic growth was 0.3%. The 2017 GDP figure exceeded the

National Treasury’s initial projection of 0.7% and later a revised figure of 1% per annum. The

greatest contributor to the GDP amongst all the sectors of the economy was Agriculture at

17.7% and was followed by mining at 4.6% and other sector of the economy. . The sector’s

contribution to the GDP in 2017 was R263 billion, which translated to 2.4%. The sector showed

a significant improvement in outputs after two years of poor performance (2015/16) as a result

of country extreme weather patterns of droughts experienced in the last 112 years. Agriculture

remains a key contributor to SA’s developmental challenges such as job creation mainly in the

rural areas and economically depressed part of country. Employment in agriculture (% of total

employment) in South Africa was at 4.8 % in 2017 as compared to 5.59% during 2016. The

drop in employment in the previous financial period is attributed to workers layout as a result

of extreme weather conditions that came with drought. The Sector offers employment

opportunities to a significant section of the population that is elementary, unskilled and also

the skilled. The labour market statistics shows that the agricultural sector skilled labour is on

the rise. There were 66 000 skilled labour in 2016 and the number has increased to 83 000 in

2017. The agricultural sector is also important for ensuring the country’s food security. In

addition to commercial-scale production, emerging farmers and subsistence farmers make

further economic contributions, although these are difficult to quantify.

2.2.3 PESTEL Analysis

A PESTEL Analysis was also conducted to determine trends, factors and variables in the

macro-environment that may impact on the organisational within the next 18 months. The

summarised PESTEL Analysis for the Joburg Market is depicted below.


of 97

Political Economic

Governmental policies o Land reform – issues of expropriation o Best practise in BBEEE

Foreign Market Risks o Trading in foreign countries by JM

clients and governmental support systems

Border and customs delays Increased pressure to ensure full

compliance to legislative provisions as well as to codes such as KING IV

National Economy remain at a low growth rate (<1%) hence consumers will spend mostly on staples (Potatoes/Onions/Tomatoes)

Higher than expected food inflation (12%)

Decrease in agricultural employment

Lower prices anticipated due to increased production yields on most commodities

Increase in demand for staples such as potatoes and apples.

Increase in demand for full spectrum of quality fruits

Social Technological

Healthy eating habits o Affluent and middle income consumers

will continue to spend more on prepared produce

Increasing urbanisation leading to inward migration to Johannesburg (10000/month);

More woman and the youth will seek opportunities in the fresh produce industry

Increased consumer pressure on healthy and safe fresh produce commodities (Post Listeriosis recovery measures)

Continued movement to higher Living Standards Measure (LSM) groups resulting in changed food preferences;

Handling and storage of produce in line with international standards

Development of IT technology capacity applicable at JM sales/control systems

Increased expenditure on security measures. (Equipment with high technological content)

New cold storage and ripening advancements

Development of JM SMART MARKET systems

Broadband and Wi-Fi

Environmental Legal

Scarcity of land and water to sustain farming

Pressure from consumers for producers to adopt environmentally friendly farming methods

Pesticide and chemical residue control by producers

Increased pressure to comply to all legal compliance matters

Increased pre-emptive food safety and quality measures

JM PESTEL Analysis

In dealing with the impact of factors identified in the macro enviroment JM is positioning its

self as follows:

Establishing secure and effective trading methodologies and superior technologies to

support the logistics of the market system.

Introduce risk control measures on fresh produce supply and food safety.

To promote the market as a central demand centre and aim at a achieving the widest

possible assortment in width and depth of fresh prduce categories;


of 97

Instil a culture of compliance in all spheres of legal and legislative compliance.

2.2.4 SWOT Analysis

A SWOT Analysis was also conducted to determine factors that may impact on the micro-

environment within the next 18 months. The outcome of a SWOT Analysis conducted in

the environment is as depicted in the table below;


of 97

JM SWOT Analysis

In order to address the key weaknesses and threats identified above, JM will pursue the

following interventions:

Intervention Weakness/Threat

Facility improvements - Trading space increase - Mandela Market precinct - Pallet pool

Ageing infrastructure

Inadequate floor space

Loss of market share

Competition/Alternative Marketing methods

Stakeholder engagement programmes Ineffective stakeholder engagement

Development of an adequate structure Rising operating costs

Effective application of company policies and corporate governance

Exposure to fraud and corruption (internally & externally)

Ensure compliance to legislative and regulatory requirements

Over-regulation of the trading environment

3. 2018/19 IMPLEMENTATION AND PERFORMANCE OVERVIEW

3.1 Measurable programmes

JM introduced a new performance management system for its leadership core during 2015/16.

The system was tested and refined to ensure a clear performance activity chain and effective

integration with the Company scorecard. The Company scorecard drafted for 2018/19 is

aligned with the following:

National Development Plan (NDP) 2030;

CoJ Growth and Development Strategy 2040;

Integrated Development Plan (IDP) 2016/17 to 2020/21;

Service Delivery and Budget Implementation Plan (SDBIP) 2017/18; and

CoJ: Economic ClusterBusiness Plan 2018/19.

The Capital Information Management System of CoJ

GDS - The new strategic framework

CoJ: Shareholder Compact with the Company

Legislative imperatives – MFMA, MSA and National Treasury regulations.

CoJ: Dipethogo programme

The complete Company scorecard is included in this business plan as Annexure 1.


of 97

3.2 Projects Aligned To Priorities

3.2.1 Company objectives aligned to CoJ priorities and Dipethogo

JM will pursue projects and programmes linked to the GDS and IDP. The Table below shows the alignment of JM Programmes/Projects to the

priorities as well as the Dipethogo programme. Programmes/projects are linked to the CEO’s scorecard:

No JM Goals CEO – KPI’s CoJ Priorities Diphetogo principles

1 JM Strategic deliverable 1 – Investment in infrastructure – R1.2 billion infrastructure spend by 2021

Finalize planning and design for phase 1 of the Mandela Market precinct by 30 September 2018.



2 JM Strategic deliverable 2 –

Investment in creating expertise

Create 100 EPWP job opportunities by 30 January 2019.



3 JM Strategic deliverable 3 –

Transformation at farm levels through targeted programmes and incentives

Develop a support programme for black farmers from targeted groups by 30 September 2018.

CoJ Priority 6 - Ensure pro-poor development that addresses inequality and poverty and provides meaningful redress.

Economic Development Pillar: Increasing the number of SMMEs as suppliers to the City

4 JM Strategic deliverable 4 – Maximize revenue to turnover R10 billion per annum by 2022

Achieve a turnover of R7.2 billion for 2017/18

CoJ Priority 7 - Enhance our financial sustainability.- Finance Pillar: Increase in the collection of revenue to increase funding to City projects

5 JM Strategic deliverable 5 – Good governance

Resolution of External Audit findings raised in prior year’s management report.

CoJ Priority 5 - Create an honest and transparent City that fights corruption

Institutional Review Pillar: The structural realignment of the organisation to strategic direction of the administration


of 97

3.2.2 Contribution to the Economic Growth Cluster

JM forms part of the Economic Developments Cluster. The Company has therefore aligned its activities with the cluster to ensure the envisaged

synergies for this unique cluster.

Cluster

outcome

Key flagship

programmes Indicator JM Projects : 2018/19

5% Growth Economic

development

strategy

Increase in trading at JM

Attract more Exporters of produce

(SADC Buyers and their trade offices at JM

through JM Export Desk)

Trading Space optimization project

5% Growth City Deep

Development hub City Deep as trade hub Trading Space optimization project

Communications

and stakeholder

management

Compliant trading and emerging entrepreneur

development

Forums with Stakeholders

Trading Space optimization project

5% Growth Informal sector

development

Compliant trading and emerging entrepreneur

development Agri-business ventures

Open tender

system

Economic

development

strategy

Targeted procurement practises Development of emerging entrepreneurs

Small business

incubators

Economic

Development

Strategy

Projects / Programmes in support of Emerging

Producers, Black agents , Black Farmers Black

traders, Emerging Tenants on JM site

JM training programme - Partnerships with the

CoJ industry stakeholder.

Adherence to the CoJ Transformation Policy

Increase share of fresh produce received

from Black FarmersPromoting Emerging

Agents and Entrepreneurs on site through

the new Co-operatives


of 97

Cluster

outcome

Key flagship

programmes Indicator JM Projects : 2018/19

Small business

incubators

Economic

Development

Strategy Targeted procurement practises

Development of emerging entrepreneurs

(Women, Youth and Disabled)

Open Tender

system

Informal Sector Target groups Development of Targeted Groups

Efficiencies Infrastructure

vandalism

Refine operations of extended CCTV system Refined operations of CCTV centre

5% Growth Market trading floor

and Mandela Market

Extensions

Finalize the design review Complete new timeline and specifications


of 97

3.3 Key Shareholder Programmes

The CoJ has adopted a number of focus areas:

Section 3.3.1. to Section 3.3.2 cover these initiatives:

3.3.1 Work creation programmes

Having firmed up the five outcomes and nine strategic priorities for the IDP cycle, the Executive

Mayor identified 40 interventions for implementations during the 2018/19 financial year and

outer years. He called these ‘Diphetogo’. Business Plans of entities and departments are

expected to respond to relevant Diphetogo interventions including how they plan to reprioritise

funding towards them as they take precedence.

The Diphetogo programmes for Economic Development are as follows:

Impact to be Achieved Target

The significant improvement in the ease and

experience of doing business in the City.

Achievement of targets of all Business-Friendly

Service Standards

Implementation of investment facilitation

programme

Establishment of One-stop-shop for Investors to

offer red-carpet service

Expanding the reach and rollout of the basket of

services offered to SMMEs via the City's

Opportunity Centres.

2 Operational Opportunity Centres per region

offering full basket of services.

Increasing the number of SMMEs as suppliers to

the City

Implementation of new SCM regulations to

promote SMMEs

The rollout of the City's Work seekers' Database Fully operational Work seeker's Database

accessible to all City residents

The rollout of a Youth Skills Program The achievement of 100 000 young beneficiaries

of this program.

The aggressive rollout of free Wi-Fi services to the

City's residents

Provision of free Wi-Fi to all identified economic

nodes, townships and informal settlements.

3.3.2 Green economy initiatives

Joburg Market is collaborating with CoJ to harvest waste in support of the Bio-Gas Project

being driven through EISD.

• Cleaning the Market of refuse

o Cleaner market;

o Lower refuse collection and cleaning costs;

o The Bio digester is being investigated as an ideal solution.


of 97

3.3.3 Communication and Stakeholder Engagement

To enhance Communication and Stakeholder Engagements at the Joburg Market, a integrated

Stakeholder and Engagement Strategy and Plan has been developed. After approval by the

JM Board, key programmes in the plan will be rolled out.

JM will therefore be focussing on the CoJ Nine Priorities and Programmes based on its core

mandate. This will include the following:

Programmes Action Comment

Market Agents Regular IMASA meetings

Issue management (positive/negative)

Provide feedback promptly

Create strategic partnerships – Inter alia through the JM Economic Development Committee

Existing IMASA Forum

Explore BEE Market Agents funding opportunities (investment)

Host periodic Strategic Meetings

Continental Skills transfer

Encourage exchange of out of season produce

Operational buy-in

Awareness on Africa agenda

Farmers (big/small) Outreach programmes which encourage in-bound visits to showcase JM skills base

Encourage to consign quality produce to JM

Roll out of the JM Farming project

No transformation

No access strategy

Funding for entrant farmer

Arable CoJ land in the south of Johannesburg

Buyers (big/small) Regular contact with 20 top buyers

Collaborate with customer care

Source budget allocation

Improve customer care approach

City stakeholder- COJ Mayor & MMC: Economic development

Constant appraisal of JM processes/ opportunities


of 97

3.3.4 Day to day action

Stakeholder

expectations

CoJ

Mayoral

Prioritie

s

Day-to-

Day

Functions

Key

Performance

Indicator

Baseline

(2017/18)

Target

2018/19

financial

year

2017/18 Budget

(per programme) 2018/19 target

Cape

x

Opex Q1 Q2 Q3 Q4

“F

resh

pro

du

ce m

ark

ets

sh

ou

ld b

e c

lean

, s

afe

an

d e

ffic

ien

t in

their

sy

ste

ms

an

d s

erv

ice

s in

se

rvin

g t

he f

resh

pro

du

ce

clien

t”.

No 1

and No

6

Marketing Compliance to

stakeholder

engagement

plan

100%

compliance

100%

complia

nce

- R160K 25%

compliance

50%

compliance

75%

compliance

100%

compliance

I No 3

and No

8

ICT Availability of

key systems

(SPS, JDE

and E-mail)

98%

availability

98%

availabil

ity

- R5.5M 98%

availability

98%

availability

98%

availability

98%

availability

No

4Securit

y

Security Security and

CCT V

surveillance

hours of

availability

24 hours

availability

round the

year

24

hours

availabil

ity

round

the year

- R23.3K 24 hours

availability

round the

year

24 hours

availability

round the

year

24 hours

availability

round the

year

24 hours

availability

round the

year

No 6

and No

9

Repairs

and

Main-

tenance

Number of

targeted

maintenance

interventions

implemented

30%

targeted

mainte-

nance

interven-

tions

implement-

ted

100%

targeted

mainten

ance

interven

tions

impleme

nted

R29.4M 25% of

maintenan

ce plan

50% of

maintenan

ce plan

75% of

maintenan

ce plan

100% of

maintenan

ce plan


_________________________________________________________________________

31

Strategic Renewal of JM A new Wave towards 2021

4. GOVERNANCE IN ALIGNMENT TO KING IV

The King Code (IV) contains a supplement relevant to municipalities. In this regard JM is set to

align to the principles as outline in King IV and a conversion exercise is due to be concluded by 31

October 2018.

In particular JM will ensure that it complies in particular with Principle 5.2 of the above

supplementary provisions to ensure compliance to Local Government Legislation as well as the

objectives of the CoJ.

4.1 Joburg Market Strategic Risks 2018/19

In a workshop hosted by Board, the following strategic risks were identified as key in managing

the risk profile of the Company:

Key risk no 1:


_________________________________________________________________________

32


Key risk no 2:

Key risk no 3:

Further details of the strategic risk register, with risk owners, accountabilities and timelines is

attached in this document as Annexure 5.


_________________________________________________________________________

33


4.2 Internal Audit

JM has an independent Internal Audit Unit, which reports functionally to the Audit and Risk

Committee of the Board and administratively to the Chief Executive Officer. The Unit carries out

its functions in accordance with the approved Internal Audit Charter.

The scope of work of Internal Audit is to determine whether the organisation’s network of

governance, risk management and control processes as designed and presented by management

is adequate and functioning in a manner that ensure that:

Risks are appropriately identified and managed

Financial and operational information is accurate, reliable and timely

Employees’ actions are in compliance with the applicable laws and regulations

Resources are acquired economically and used efficiently and effectively,

Assets are safeguarded

Monitor the resolution of the Auditor General findings

In developing its work plan, the Internal Audit Unit follows a risk-based approach, taking into

account the following:

Strategic focus areas as contained in the Business Plan

Strategic risk register and operational risk registers

COJ Group Internal Audit requirements

Prior years’ external and internal audit findings

Legislative requirements.

The Internal Audit Plan is subject to approval by the Audit and Risk Committee.

5 FINANCIAL MANAGEMENT

In line with the City’s approved financial development plan (FDP), GDS, IDP, nine priorities and

the principles of Diphetogo, the financial management function is the key driver to achieve financial

sustainability in the JM. It is responsible for the organization aspects of its financial health. It is

accountable for the resources entrusted to it, including funding, expenditure management, and

cash-flow management including budgets and accounting responsibilities. It also involves the

implementation of business process engineering to effect strong internal controls.

It ensures that all funds are spent in accordance with JM policies and procedures, and operating

needs met within available budgets. Its responsibility also includes financial management, and

development of investment strategies and financial reporting and expenditure monitoring. It

encourages units to develop an oversight process that builds on best practices. It determines all

funding sources, expenditures and reserves available for future use (excluding those already

committed and budgeted for current period). Furthermore; it includes all outstanding commitments

to unit-wide programs, capital projects. The department also provides management with

information necessary to make strategic decisions at any time during the year.


_________________________________________________________________________

34


5.1 Fixed Asset Controls and Insurance

The JM Fixed Assets business unit within the Finance structure is tasked and responsible for the

safeguarding and management of its assets and insurance of assets thereof. The management

of the Company’s fixed assets being Property, Plant, Equipment, Investment Property and

Intangibles by means of ensuring that the requirements of the strategic objectives and operational

needs are met with the allocation of a capital expenditure budget. This process entail planning and

proper budgeting of all capital projects, acquisition, maintenance and disposal of scrap and

redundant assets are in terms of the Finance policies and procedures.

All acquisitions and disposals are carried out in line to the requirements of the MFMA and Supply

Chain Regulations. These include among others; maintenance of the Joburg Markets fixed asset

register by means of physical asset verifications, impairments and re-valuations of assets. The

insurance component includes; insurance for business continuity, assets, employees, accidents

and asset loss.

5.2 Supply Chain Management

Supply chain management at JM serves to enhance compliance, improve accountability and

transparency, update measures required to combat fraud in the supply management value chain.

It supports the sound financial management processes in place to improve service delivery. SCM

provides the mechanisms for implementing demand, acquisition, logistics and performance

management.

SCM plays a pivotal role by spanning demand, right from the end-customer's requirement to the

suppliers that provide the goods and services to meet the needs. It involves going beyond the

suppliers that interface with the organisation in order to effect improvements. These may include

removing cost, increasing quality or ensuring ethical, environmental or socially responsible inputs.

The Supply Chain’s role in JM is performed in terms of applicable legislative and regulatory

requirements.

5.3 Cashiering

To further ensure an effective cash management system and approach, the cashiering department

supports the business by ensuring that all cash received from customers is safely deposited, all

refunds are deposited to customer’s accounts, all cashiers perform a daily balancing function and

all daily cash is deposited through the officially appointed service providers for banking purposes.

5.4 Budget 2018/19 Overview

The budget for 2018/19 has been prepared using the following key parameters and assumptions:

The revised budget for 2017/18 has been used as the base period for the medium term

budget (MTB)

Key priorities of Economic Growth Cluster;

Integrated Development Plan (IDP);

The service Delivery Budget Implementation Plan (SDBIP)

Financial Development Plan (FDP) and


_________________________________________________________________________

35


Company’s strategic priorities and business plan

Mayoral Proposed Priority Implementation Plans

Diphetogo principles

The CoJ indicatives have been followed:

CoJ Key Indicatives

5.5.1 Finance Key Priorities

In line with the CoJ long term impact (GDS 2040 related output) is to build a financially and

administratively sustainability and resilient City. Therefore the key priorities of Joburg Market are

as follows:

• Effective budget management – (Costs containment );

• Business process re-engineering;

• IT technology and SMART systems (Inclusive of SMART payment systems).

It is envisaged in order to ensure maximum budget spending the following strategies have been

adopted.

• Improved budget and programme planning: Extensive consultation during target setting;

• Focus on improving supply chain processes;

• Internal monthly expenditure monitoring as an early warning mechanism;

• Effective financial policies and procedures;

• Effective business processes for internal control.

5.5.2 Income Statement and Commission revenue

The following turnover estimates are presented:

• Turnover growth is forecasted down by 2.87% due to improved weather conditions in

2017/18

• Rental of facilities revenue is charged at CPI plus 2%.

Graph 1 below depicts the Revenue over the MTB


_________________________________________________________________________

36


Revenue over the MTB Period

5.5.3 Core and Rental Revenue

The following trends are foreseen for JM:

• The core revenue for the company consists mainly of commissioning income which

account for more than 80% of the total revenue.

• Rental Income accounts for 14% of the total revenue.

• The implementation of the Smart Market program will ensure revenue base of the

company is enhanced in the future.

5.5.4 Total Revenue/total Expenses

The total Revenue will increase from R414.1 million to R437.9 million in 2017/18 financial year

which represents 5.7% increase. Operating expenditure increases from R318.5 million to R328.9

million which is a 3.3% increase.

Revenue Budget ('000')

2017/18

Approved

Budget

2017/18

Revised

Budget

2018/19 Draft

Budget

2019/20 Draft

Budget

2020/21 Draft

Budget

Rental of facilities 56 217 249 59 670 749 63 352 073 67 262 508 71 413 675

Commission 373 939 461 363 329 533 378 217 550 398 777 431 426 529 540

Other 7 714 449 8 131 030 11 570 105 13 220 948 14 934 879

Total 437 871 159 431 131 312 453 139 729 479 260 887 512 878 094


_________________________________________________________________________

37


Revenue/expense projections for the next three years

2017/18 Revenue Sources and Ajustment Budget 2017/18

• The core revenue for the company consist mainly of commissioning income which

account for more than 80% of the total revenue.

• Rental Income accounts for 14% of the total revenue.


_________________________________________________________________________

38


5.6 Operational Expenditure

Three year planned expenditure trend

Planned Expenditure by programme

5.6.1 Personnel Costs

Personnel cost will increase by 6.2% million from R140.5 to R149.2 million in 2017/18. The

increase is due to the population of the new structure. The increase provides for the normal

increases against the usual based on the estimated salary increase (as per SALGA agreement)

and includes only critical vacancies required. Furthermore, salary and medical aid increases will

be above inflation and taken into account.

Priority %

Allocation

2017/18

Approved

Budget

2017/18

Adjusted

Budget

2018/19 Draft

Budget

2019/20 Draft

Budget

2020/21 Draft

Budget

"R" "R" "R" "R" "R"

Enhancing our Financial

sustainability and resilience 10% 5 290 000 5 290 000 28 775 000 64 181 650 33 116 500

Improve Service Delivery &

Culture10% 5 290 000 5 290 000 28 775 000 64 181 650 33 116 500

SMME and Enterprise

Development/Support15% 7 935 000 7 935 000 43 162 500 96 272 475 49 674 750

Promote Economic

Development Investment

GVA 5% by 2021 &

Infrastructure Development

55% 29 095 000 29 095 000 158 262 500 352 999 075 182 140 750

Good Governance 5% 2 645 000 2 645 000 14 387 500 32 090 825 16 558 250

Other Day to Day

Operational expenditure 5% 2 645 000 2 645 000 14 387 500 32 090 825 16 558 250

TOTAL 100% 52 900 000 52 900 000 287 750 000 641 816 500 331 165 000


_________________________________________________________________________

39


5.6.2 Other Operating Expenditure

The increase in other operating expenditure is as follows:

• Depreciation – The budget increased from R20.6 million to R21.7 million which represent

5.4% increase. This is mainly due to projects being capitalized within the financial year.

The Capital expenditure budget for 2017/18 is R52.9 million.

• Repairs & Maintenance – Increase from R27.7 million to R29.4 million. The increase is in

line with increase of CPI as per the indicatives provided.

• Human Resources and Marketing will increase according to the indicatives provided.

• Operational expenses increase by 4% from 76.7 million to R79.8 million this is due to

reduction in cost in refuse removal that is anticipated by sourcing a supplier via competitive

bidding.

5.6.3 Surplus

The surplus after tax for 2017/18 increased from R56.50 to R64.5 million after tax, which represent

an increase of 14.2%.

Impact on Surplus

Reduction in turnover from R7.4bn to R7.2bn

• Reduction of commission income from R374m to R363m

• No rental income growth

JM Surplus Projection

5.6.4 Expenditure Medium Term Budget for 2015/16 – 2018/19 Financial years

In terms of the Mid-Term Expenditure Framework, the key indicators for FY: 2018/2019 is as

follows:


_________________________________________________________________________

40


FY2017/2018 ExpenditureBreakdown


_________________________________________________________________________

41


The table below depicts a detailed report indicating the outer year’s financials

Employee related costs have been increased in line with the indicatives, assumptions and key

parameters. The filling of vacancies will be prioritised to key strategic & critical positions. Repairs

& maintenance budget is at 9.0% of the total operating expenditure which is aimed at protecting

the capital investment. Administrative and non-service areas budget have been reduced and

savings identified. The City’s mandate on CPI, and loan interest parameters have been

implemented.

5.7 Capital Projects

The Entity’s approved Capital Expenditure Budget for the 2017/18 financial year amounts to R52.9

million. The Capex budget is mainly attributable to building improvements of the aging

infrastructure.

The Capitial Expenditure for 2017/18 will address the following asset classes:

• Upgrading of Wholesale Hall facilities in compliance with HACCP standards.

• Food Security initiatives

• Upgrading of Information Technology

• Upgrading of facilities toward a Green Economy

• Ensure that Facilities comply with Health & Safety standards.


_________________________________________________________________________

42


• General upgrading of Trading Hall facilites

• Upgrade of the Main Administration Building

5.7.1 Source of Funding

The Capital expenditure for 2017/18 will be self-funded and spent per asset class as depicted in

figure below;

JM Capex Sources FY2017/18 - 2018/2019

5.7.2 Detail Medium Term Capital Budget 2017/18

JM Approved Capex

5.7.3 Capital Expenditure implementation plan

JM is on a concerted drive to improve capital expenditure at the JM facilities. The focus therefore

will ensure that the following are implemented:

Demand and acquisition plan to be finalized before the start of the financial year.

Implementing the acquisition plan before the end of Quarter 1.

SCM committees are properly identified and trained in SCM processes and regulations.

Utilizing a panel of Service providers to synergize demand acquisition.

Capex forum held on a regular basis to monitor progress on the Capex implementation

plan.

Asset Class 2017/18

Approved

Budget

2017/18 Adj

Budget

2018/19 Draft

Budget

2019/20 Draft

Budget

2020/21 Draft

Budget

Furniture - 250 000 1 000 000 1 000 000 1 000 000

Information Technology 4 550 000 8 150 000 19 000 000 50 165 000 45 165 000

Land & Building 38 585 650 32 785 650 258 000 000 576 651 500 281 000 000

Office Equip - 250 000 1 000 000 - -

Plant and Equip 9 764 000 11 464 000 8 750 000 15 000 000 5 000 000

Total 52 899 650 52 899 650 287 750 000 642 816 500 332 165 000


_________________________________________________________________________

43


ARGANISAURE

6 Organisational Structure

JM has developed the following organisational structure in order to carry out its mandate in

accordance with the new strategic direction JM is following:

Joburg Market Organisational Structure

6.1 Office of the CEO

In addition to CEO’s responsibilities as an accounting officer, the CEO is administratively

responsible for the following functions:

• Internal Audit

The internal audit function also submits reports to the Audit Committee of the Board of

Directors. As part of its on-going campaign to ensure compliance, regular audits are conducted

and reviews undertaken to support the JM in its quest to adhere to legal and legislative

compliance. The function also supports the effort to comply with the principles of the King Code

on corporate governance.

• Risk Management


_________________________________________________________________________

44


The risk management function is performed strictly in accordance with the policies of the CoJ

and the corporate risk function of the Shareholder Unit of CoJ (SHU). As a third phase

programme aimed at refining the risk portfolio in accordance with the risk standards adopted

by CoJ is in the process of being implemented.

• Company Secretariat

The Company secretarial service supports the functions of the Board and reports to the CoJ.

The application of bylaws and relevant agricultural legislation requires constant legal support

by this function. The vetting and drafting of commercial contracts also forms part of its mandate.

• Project Management Office (PMO)

The role of the PMO is the management of all projects for the Market through the appropriate

application of project management principles. Once completed, some project outcomes will be

incorporated into day-to-day operations.

6.2 Strategy and Transformation

This division is an all-encompassing unit that will work hand in hand with all other units. Strategy

and Transformation will play a key role in changing the culture and efficiency of JM. The following

portfolio of services is rendered by the above department:

• Strategic Planning

Strategic planning includes the development of annual and 3 year business plan. The

function is also responsible for longer term strategic planning and trend analysis based on

developments in the many spheres of the fresh produce industry. It provides input to an

organisation of regular strategic sessions.

• Monitoring and Evaluation

o Strategic support mainly focuses on commercial risks and mitigation.

Commercial risk management includes the monitoring of the alternative market

ventures and activities by stakeholders to circumvent the JM. Major

interventions include the redesign of Market By-laws and the introduction of a

new licensing system for market agents and their sales forces.

o Following the approval of a performance management system in compliance

with the provisions of the Municipal Finance Management Act (MFMA) the

function resides with the office of the CEO.

o Performance Management is monitored by the Board through its committee

systems and forms part of key strategic planning sessions.

• Stakeholder engagement

o The objective of this unit to ensure that all government communications are

dealt with accordingly and that all government objectives and processes are

achieved and followed by JM respectively.

o The function of international relations is conducted by the CEO and an

international relations manager. Special emphasis is placed on the


_________________________________________________________________________

45


development of trading in the SADC region and other viable trading

opportunities with countries on the African continent including islands such as

Mauritius and the Middle East.

o The JM also holds membership with the World Union of Wholesale Markets

(WUWM) and the Produce Marketing Association of America (PMA). Head

offices of these institutions are located in the Netherlands and the United States

of America.

o The above mentioned organisations provide a platform to ensure regular

information flow to its members and facilitate networking opportunities.

Innovation and modernisation information received at international conferences

and Expos holds great value to the planning processes of JM.

o From the SADC region the JM is continuing to experience a growing number of

buyers. Distances and logistical challenges remain a major challenge and the

JM will be involved in researching technologies and methods to enable the

tapping of this market opportunity.

o Intergovernmental relations with NDAFF and GDARD will be built around key

projects and programmes.

o NDAFF and the NAMC will be consulted on a regular basis to extend the

information bank to be established at JM for its programmes and projects.

• Transformation

The objective of this function is to transform the JM’s current state, with respect to Broad Based

Black Economic Empowerment (BBBEE) and operational efficiency, into a market that is world

class, highly efficient and supports BBBEE.

This objective will be achieved by:

o Enabling targeted beneficiaries to conduct business in the main stream trading

opportunities for fresh produce

o Nurturing sustainability of beneficiaries through continuous support programmes

backed by suitable expertise

o Harness the goodwill of stakeholders to establish food security across the CoJ

o Building and supporting the good image of targeted entrepreneurs with major fresh

produce buyers and distributors

• Marketing and Communications;

o The function performs the following marketing tasks:

Key account management;

Local and International Stakeholder relations;

Customer care;

Marketing research;

Promotions; and

Corporate social investment.

o This function is mainly conducted from a Business-to-Business perspective. Clients are

dispersed across South Africa and the SADC region.

o The Marketing division also plays a vital role in the Corporate Social Investment

program of JM and administers the food bank system.


_________________________________________________________________________

46


o Marketing & communication activities include participation in exhibitions, media

projects and Industry related conferences and seminars.

o The function also conduct regular marketing research to measure performance the

performance of JM and its stakeholders situated on the Market.

6.3 Agri - business

The following portfolio of services is rendered by the above division:

The division’s focus areas are; a) Food Security, b) Research and Development, and c) Enterprise

Development. Three departments within the Division have been developed to support these focus

areas.

• Food Security

The Joburg Market plays a supportive role to the City of Johannesburg’s (CoJ) efforts that have

been put in place and future plans developed to ensure a food secured City. It is this aspiration

that the Joburg Market (JM), through the Agribusiness Division activities, which include the Food

Support Centre and food donations, is in support of in partnership with the likes of the CoJ

Department of Social Development (DSD). The DSD of the CoJ takes the lead in the CoJ Food

Security Programme and the Joburg Market plays a supportive role. Key to this supportive role is

through the Food Support Centre. The JM has a Food Security Strategy with five implementable

programmes. These programmes are currently under implementation and are continuously

reviewed with the intention of ensuring that they remain relevant and are in response to food

security challenges and existing opportunities. The department is charged with the responsibility

to;

Optimise the Food Support Centre operations with the view to increase food parcels aimed

at indigent support

Interact with other fresh produce and food institutions to optimise the donations of food

towards the Food Support Centre

Create and update data bases to refine reporting in order to identify opportunities and

minimize risk to the Food Support Centre system of JM

Serve as committee member in forums of the CoJ related to food security with the view to

align JM food security initiatives with that of CoJ.

• Research and Development

For fresh produce markets in South Africa to remain relevant and better positioned to deal with

ever-changing industry dynamics, in-depth research is required. The JM is no exception to this. In

addition to remaining relevant, research contributes in positioning fresh produce markets to take

well informed strategic decisions.

In fulfilling the above, Agribusiness Division is responsible for the development and management

of the Agricultural Resource Centre within JM. The Centre’s focus is on research and assessment

of fresh produce industry and assist in developing strategies to ensure that JM adapts to current

industry realities and possible future industry developments. The department research agenda’s

focus is to;


_________________________________________________________________________

47


• Create a resource centre within JM to enable industry related training of staff

• Provide the resource centre with research materials and reported results to enable all

employees to utilize the knowledge base in training and researching problem areas

• Produce electronic referencing and electronic publications retrieval capacity to enable

electronic scrutiny by internal users

• Produce a database of all agricultural related authorities, growers associations and

organizations in agriculture to enable effective communication with stakeholders.

• Enterprise Development and Partnering

Another important area of focus assigned to the Agribusiness Division is the development of

agribusiness opportunities and development of partnerships. Given the dynamics of the industry

and the JM’s scope of operation within the fresh produce value chain, development of partnerships

is a cornerstone for successful agri-business enterprises development. Forming part of key

requirements for enterprises development is linking commercial and emerging farmers in pursuit

of sustainable trading opportunities. In the recent past, it became evident that the agro-processing

stage of the value chain is underdeveloped. This calls for key industry players like the JM to deploy

resources to respond to existing agro-processing opportunities. The departmental priorities are as

follows:

Link JM projects/programmes with potential agricultural partners to optimise outcomes

of projects/programmes

Identify agricultural value adding opportunities for targeted groups for business

empowerment

Analyse the institutional market to identify opportunities for emerging producers, traders

and agents to create viable enterprises

6.4 Core Operations

The following portfolio of services are rendered by the above division:

• Consignment Control

Consignment control and consignment audit ensures that all produce entering the Market site

is captured accurately to ensure that all income is recorded at the correct levels. Secondly it

also aims to protect the interests of both producers and buyers. In the latter respect the CEO

of JM performs the role of an independent “referee”. Powers to conduct this role is inter alia

embedded in the Market bylaws.

Commission Business

This function is the custodian of the services rendered to clients and for which an ad valorem

market due of 5 percent is collected on the gross value of each consignment sold. It ensures

orderly trading practices and conducts the daily operations of the trading halls and services

supporting trading.

• Property administration


_________________________________________________________________________

48


o JM provides cold storage and ripening services from which usage income is

derived. Furthermore, in terms of the bylaws and policy directives utilised to manage

the market, income is also generated from fees and fines such as floor storage

charges if produce remain unsold for an extended period. The Property function

acts as a property management function managing these income generating

properties.

o Property rental is the second largest contributor to the income of JM. Clients operate

diversified activities on the Market site which require in general a high level of risk

awareness and as a consequence regular risk and housekeeping assessments are

conducted.

o To further support the Joburg Market expansion and growth strategy, the property

services department supports the business by determining the rental rates as per

stipulated guidelines; advertise vacant premises and recommending suitable

tenants, producing leasing agreements including repair and maintenance. In

addition, the function includes invoicing, receipting, debt collection and reporting.

• Infrastructure

o This division is also responsible for the maintenance of the facilities and equipment

of the Market. Critical installations such as the cold stores and ripening chambers

are sensitive to even mild deviations and require continuous availability of trained

support staff.

o The various buildings and other amenities requires regular maintenance and

upgrading. Maintenance activities are structured in a maintenance plan for JM.

• Food Quality Assurance

Quality assurance is an inspection service ensuring product quality standards as well as food

safety in protecting the interests of consumers. In particular random tests are conducted to

ensure that no unduly high levels of agricultural chemical residues such as insecticides,

fungicides and herbicides are present on food products received at the market for sale. The

division also monitors hygiene compliance of market facilities and works closely with the

relevant regulatory bodies such as DAFF, DoH and COJ Health Department.

6.5 Human Resources and Compliance

The following portfolio of services is rendered by the above department:

Human Resources Management and Development;

o Training and coaching of employees in the fresh produce trading environment remains

a priority. The department has embarked on a targeted skills development programme

on an annual basis.

o The HR function is to development the remuneration framework for staff as well as the

maintenance of HR records.


_________________________________________________________________________

49


o It is further tasked with the function of Labour Relations and employee performance

assessment administration.

o The Wellness Centre is responsible for the provision of primary health care support,

counselling and employee assistance.

Legal Services;

o Responsible for drafting and review of Policies and By-laws

o Providing of Legal Advice and Opinion to the Company.

o General Litigation

o Drafting of pleadings and legal documents (SLAs and Contracts, etc.).

o Labour Litigation

o General advice and assistance on disciplinary matters.

o Representation of Council (CCMA, Courts and Private Arbitrations)

o General matters of compliance and risk management

o Management of external attorneys and relevant service providers

General Office Administration & Auxiliary Services

o Management of Company’s Registry services.

o Responsible for office cleaning and minor maintenance

o Printing and binding of all Company’s print jobs

o Provision of house-keeping and kitchen services.

o Provision of internal messenger services.

Compliance and Enforcement

o Development and Implementation of the Security Plan.

o Physical Security at the Market

o Management of outsourced security service.

o Incident Management

o By-law enforcement.

o Physical patrolling of the Market Premises

o Engage external Law Enforcement Agencies on security measures at the Market.

o CCTV renders complementary support to physical security at the Market.

o Monitoring of activities in and around the Market

o Analysis of data to develop counter measures

Information technology

o Development and continuous aligning of IT Master Planning with Company’s Strategy

o Ensure availability of IT Systems at all times.

o Responsible for the design, management and growth of the entire IT Infrastructure

o Responsible for security of all IT Systems

o Management of access to the IT system.

o Administration of all other IT Applications

o Responsible for User Support in all Systems.

Safety, Health and Environment

o Ensuring compliance with OSH Act.

o Occupational Health and Safety assessments

o Emergency and Evacuations Plans

o Management of Occupational Injuries and Diseases.


_________________________________________________________________________

50


o Deployment and servicing of emergency tools and equipment.

6.6 Finance

The following portfolio of services is rendered by the above department:

Financial Management

o The financial management function is the key driver to achieve financial sustainability of

the Joburg Market. It is responsible for the organisationall aspects of its financial health.

It is accountable for the resources entrusted to it, including funding, expenditure

management, and cash flow management including budgets and accounting

responsibilities. It also involves the implementation of business process engineering to

effect strong internal controls.

o It ensures that all funds are spent in accordance with JM policies and procedures, and

operating needs met within available budgets. Its responsibility also includes financial

management, and development of investment strategies and financial reporting and

expenditure monitoring. It encourages units to develop an oversight process that builds

on best practices. It determines all funding sources, expenditures and reserves

available for future use (excluding those already committed and budgeted for current

period). Furthermore; it includes all outstanding commitments to unit-wide programs,

capital projects. The department also provides management with information necessary

to make strategic decisions at any time during the year.

Fixed Asset Controls and Insurance

o The Joburg Market Fixed Assets department within the Finance structure is tasked and

responsible for the safeguarding and management of its assets and insurance of assets

thereof. The management of the Company’s fixed assets being Property, Plant,

Equipment, Investment Property and Intangibles by means of ensuring that the

requirements of the strategic objectives and operational needs are met with the

allocation of a capital expenditure budget. This process entail planning and proper

budgeting of all capital projects, acquisition, maintenance and disposal of scrap and

redundant assets are in terms of the Finance policies and procedures.

o All acquisitions and disposals are carried out in line to the requirements of the MFMA

and Supply Chain Regulations. These include among others; maintenance of the

Joburg Markets fixed asset register by means of physical asset verifications,

impairments and re-valuations of assets. The insurance component includes; insurance

for business continuity, assets, employees, accidents and asset loss.

Supply Chain Management

Supply chain management enhances compliance, improves accountability and

transparency, it update measures required to combat fraud in the supply management

value chain. It supports the sound financial management processes in place to improve

service delivery. SCM provides the mechanisms for implementing demand, acquisition,

logistics and performance management.


_________________________________________________________________________

51


Cashiering:

To further ensure an effective cash management system and approach, the cashiering

department supports the business by ensuring that all cash received from customers is

safely deposited, all refunds are deposited to customer’s accounts, all cashiers perform a

daily balancing function and all daily cash is deposited through the officially appointed

service providers for banking purposes.

7. Human Resource Management Plan

In the financial year 2016/17 Joburg Market developed a Human Resources Management &

Development Strategy, which is the four year plan depicting the road map for human resources

management and development . The Strategy outlines the intentions of Joburg Market in relation

to how it will manage its human capital and it articulates the integration of the human resources

processes. It deals with:

Set out the framework for facilitating consistent action and behaviour in respect of

employment relations management in the Company.

Set out the principles or settled rules of action to which management and employees

are subject.

Indicates how the employment relationship should be operated in the organization.

Ensure that all the Company’s Human resources practices are in line with, and

promote the Company’s Mission, Vision and Values

In the HRM&D Strategy key strategic goals were identified and linked programmes that aimed at

realising these strategic goals. The table below captures the strategic goals and programmes

linked to each one of them.

No Objective No Actions Year One

2016/17

Year Two

2017/18

Year Three

2018/19

Year Four

2019/20

1. Human Resources Strategic Alignment

1.1 Organisational Structure aligned to the Company Business Plan.

X X X X

1.2 Proactively engage customers in the analysis of their workforce management needs and issues and identify strategies to address concerns

X X

1.3 Implement a workforce planning processes, techniques and tools to proactively identify the human resources required to meet Business Plan objectives

X X X X

1.4 Develop JM HRD & M Strategy aligned to the Group HR Strategy for CoJ

X


_________________________________________________________________________

52



2016/17

Year Two

2017/18

Year Three

2018/19

Year Four

2019/20

2. Effective Human Resource Planning

2.1 Effectively identify, attract, recruit and retain the best talent to help the Company meet its Strategic Objectives

X X X X

2.2 Identify scarce and critical skills

X X X X

2.3 Conduct job evaluation and develop standardized job profiles for all positions to be used as a basis for recruitment and career pathing.

X X X X

3. Organizational Development

3.1 Conduct employee climate survey to understand current challenges around organizational culture, use the results to design future/ideal organizational culture.

X X

3.2 Conduct formal review of Company’s orientation process and develop implementation plan to streamline and improve employee orientation

X X

3.3 Conduct exit surveys/interviews to identify reasons for attrition and use the information to enhance or improve employee experience of the Company

X X X X

4. Build and Sustain a Capable, Diverse, Well-Trained, Workforce and Enhance Retention Through Learning and Professional Development Opportunities

4.1 Conduct an annual training needs assessment to ensure training is designed to improve organizational and individual performance

X X X X

4.2 Implement a leadership development programme for all supervisors, managers and executives to invest in the continuous development of leadership

X X X X

5. Inculcate a Results-Oriented High Performance Culture

5.1 Roll-out of employee Performance Management to enforce responsibility and accountability by line managers and employees to enhance organizational,

X X X X


_________________________________________________________________________

53



2016/17

Year Two

2017/18

Year Three

2018/19

Year Four

2019/20

team and individual performance.

5.2 Cascade employee performance management system to lower levels

X X X X

5.3 Develop Individual Development Plans for all employees and translate that into Work Place Skills Plan for training interventions to address skills gaps

X X X X

6. Recognise & Reward Performance

6.1 Provide a progressive remuneration framework for Joburg Market which is affordable, competitive, attractive and that provides for advancement through salary ranges

X X X X

6.2 Adopt and implement Key Salary Scale based on the TASK Job Evaluation System.

X X X X

7. Sound Employee Relations & Human Resources Governance

7.1 Conduct a review of HR Policies, SOPs and Processes as and when required, ensuring alignment to legislative requirements and best practice

X X X

7.2 Capacitate line management/ supervisors through coaching and continuous training on grievances and disciplinary matters

X X

7.3 Ensure sound and viable labour relations through the local labour forum.

X X X X

7.4 Promote healthy, resilient and productivity among employees

X X X X

The Implementation Plan for the HRM&D Strategy contains interventions that have been identified

and prioritized for the next four years. It also reflects the key deliverables for the each year of the

Plan and these are subject to the annual budget. Progress against the plan and the performance

indicators and targets are monitored. The impact and effectiveness of each of the interventions is

measured and corrective action taken on quarterly and annual basis.

7.1 Human Resource Development (HRD)


_________________________________________________________________________

54


The key pillars that guide the human resource development strategy are as follows:

o Organisational Development - ensuring that JM implements a change management

process preparing employees for the change in business strategy and processes.

o Organisational Culture - conducting a climate survey to assess issues that impact on

employee morale and implementing programmes to reduce negative perceptions by

employees.

o Talent Management - ensuring that JM nurtures existing talent and attracts appropriate

talent into the organisation.

o Retention - of critical and core skills to ensure continuity and consistent high

performance, and improved productivity.

o Succession planning - identifying succession candidates and mentors for critical

positions to ensure a constant pool of talent, especially in positions that are hard to fill.

o Developing appropriate organisational structure – the structure will assist us to

align the recruitment to the business strategy and ensure the stability in the

organisation. The process in already in progress and an annual review of the structure

is envisaged to keep it realistic and relevant for the business.

o Implementing a performance management system & culture - to inculcate a culture

of service excellence and accountability; all managers will be placed on performance

management.

o Managing employee safety & wellness – we will implement a comprehensive

wellness programme that ensures a productive workforce. The wellness programme

will promote chronic disease management and promote work-life balance for staff.

o Sound employee relations – implement an employee engagement strategy that

incorporates an alignment of the LLF and Company programmes for ensuring sound

and labour environment. Mechanisms will be created that provides employees with

avenues to address their workplace challenges with assurance of confidentiality.

o Remuneration & reward - JM shall constantly review the reward strategy and

remuneration practices to keep abreast of trends and promote loyalty. Efforts will be

made to introduce reward schemes that encourage retention and that encompass both

financial and non-financial rewards

o Improved systems & processes – implement continuous improvement of our systems

and processes through benchmarking and alignment of processes to progressive

organisations’ standards.

o HR planning – ensuring that manpower planning is informed by business requirements

and needs. The key intervention will be to undertake job evaluation and profiling that

will inform the requisite skills.

7.1.1 Skills Priorities for JM

The focus of the training initiatives will address the following skills priorities:

Technical skills

Banana Ripening

Packaging and Labelling

Food Safety Standards


_________________________________________________________________________

55


Cold Store Fundamentals

Logistics and Consignment Movement

Stock Auditing

Artisan Training

Product knowledge training

In terms of developing JM leadership and management the following initiatives will be rolled out:

Retail Management Development Programme

Project and Programme Management

MFMA Competencies Programme

Self-Mastery Programme for all managers.

Risk Management

Ethics and Governance

Membership of Professional bodies for all Managers

Local Government Administration


_________________________________________________________________________

56


7.1.2 Employment Equity

The JM continuously strives to comply with the provisions of the Employment Equity Act. The

Employment Equity (EE) Plan is aligned to the demographics data of Gauteng to ensure

consistency with provincial employment data. The projected demographic profile of the Joburg

Market is intended to be as reflected in table below;

JM Projected Demographic profile - 2018/2019

OCCUPATIONAL

LEVELS

TARGET AS AT JUNE 2019 STATUS AS AT JULY 2017

MALE FEMALE

TO

TA

L

MALE FEMALE

TO

TA

L

A C I W A C I W A C I W A C I W

Top Management 1 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 1

Senior Manager 3 0 0 0 1 0 0 1 5 3 0 0 0 1 0 0 1 5

Mid Manager /

Professional 19 2 3 8 11 0 2 3 48

18 2 3 7 11 0 2 3 46

Skilled Tech /

Junior Manager 50 2 2 11 43 3 4 11 126

49 2 2 9 41 3 4 11 121

Semi- Skilled 62 2 1 5 68 5 0 8 151 62 2 1 4 68 5 0 7 149

Unskilled 19 0 0 2 21 0 0 0 42 19 0 0 2 21 0 0 0 42

TOTAL 154 6 6 26 144 8 6 23 373 152 6 6 22 142 8 6 22 364

Joburg Market 2018/2019 Business Plan _________________________________________________________________________

57


ANNEXURE 1: JM 2018/19 SCORECARD

Dip

heto

go

pro

gra

mm

e im

pact

National outcome 6: An efficient, competitive and

responsive economic infrastructure network.

Co

mp

an

y

Strategic

policy/plan

:

JM Trading Space

Optimization Programme

Output:

Improved

trading results

King IV Principle

Strategic Objective

Total Weight

25%

Lead

er

Multiyear predictions

Section 87 (MFMA)

IDP Outcome 1: A growing, diverse and competitive

economy that creates jobs

Strategic

priority:

Implement business growth

programmes

Outcome:

Growth of the

business of JM

2.2: The governing body

should ensure that reports

and

other disclosures enable

stakeholders to make an

informed

assessment of the

performance of the

organization and its ability

to create value in a

sustainable manner

CoJ Strategic priority 1: Promote economic development

and attract investment towards achieving 5% economic

growth that reduces unemployment by 2021.

KPI

Means of

verificatio

n

Unit of

measur

e

Baseline Target

2018/19

Key

intervention

s

2018/19 Budget

per programme Quarterly Targets

YTD

KPI

Weigh

t CAPEX

R/M

OPE

X

R/M

Q1 Q2 Q3 Q4 2019/20 2020/21

Strategic deliverable : Maximize revenue to turnover R10 billion per annum by 2022

Strategic objective: Ensure financial sustainability and growth of the entity

Fin

an

ce –

In

cre

as

e in

th

e c

ollecti

on

of

reven

ue t

o i

ncre

ase f

un

din

g

to C

ity p

roje

cts

(1.1)

% Targeted

market share

held by JM in

relation to other

FPMs

FPMs: National

Fresh Produce

Markets in South

Africa

National

market

share

report

indicating

JM in

relation to

other FPMs

as

measured

by SAUFM

SAUFM:

South

African

Union of

Food

Markets

%

(cum)

42.5%

Targeted

market share

held by JM in

relation to

other FPMs

44.0%

Targeted

market

share held

by JM in

relation to

other FPMs

Develop

monitoring &

reporting

software

(SPS Data

Warehouse)

0 0,95M 42.0%

Targete

d market

share

held by

JM in

relation

to other

FPMs

42.5%

Targete

d market

share

held by

JM in

relation

to other

FPMs

43.0%

Targeted

market

share

held by

JM in

relation to

other

FPMs

44,0%

Targeted

market

share

held by

JM in

relation to

other

FPMs

44.0%

Targeted

market share

held by JM in

relation to

other FPMs

25%

Ag

ri-

Bu

sin

ess

45.0%

Targeted

market

share held

by JM in

relation to

other FPMs

46.5%

Targete

d market

share

held by

JM in

relation

to other

FPMs Total 0 0,95M

R/M

(cum)

R 7.478 Bn

R 7.478 Bn

SPS:

JM Real time central electronic

trading system

1,57Bn R3,52Bn R5,5Bn R 7,47 Bn R 7.478 Bn R7,49Bn R7,51Bn


58


Dip

heto

go

pro

gra

mm

e im

pact

National outcome 12: An efficient, effective and

development oriented public service and an empowered, fair

and inclusive citizenship.

Co

mp

an

y

Strategic

policy

/plan:

JM: Transformation Strategy Output: Empowerment of

targeted groups King IV Principle

Strategic Objective

Total Weight

25%

Lead

er


Section 87 (MFMA)

IDP Outcome 1: An inclusive society with enhanced quality of

life that provides meaningful redress through pro-poor

development

IDP Outcome 3: Enhanced, quality services and sustainable

environmental practices Strategic

priority:

Drive Socio-economic

Transformation

Outcome: BEE owned

enterprises trading

with/at JM


should govern

compliance with laws and

ensure consideration of

adherence to non-binding

rules, codes and

standards. Mayoral priority 2: Ensure pro-poor development that

addresses inequality and poverty and provides meaningful

redress

Mayoral priority 6: Create a City that responds to the needs of

citizens, customers, stakeholders and businesses

KPI Means of

verification

Unit of

measur

e

Baseline Target

2018/19

Key

interventio

ns

2018/19 Budget


YTD

KPI

Weight CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20 2020/21

Strategic deliverable : Investment in infrastructure – R1.2 billion infrastructure spend by 2022

Strategic objective: Operate a sustainable resilient premier marketing and trading facility

Eco

no

mic

Dev

elo

pm

en

t:

Th

e s

ign

ific

an

t

imp

rovem

en

t in

th

e e

ase a

nd

exp

eri

en

ce o

f

do

ing

bu

sin

ess i

n t

he C

ity

(2.1) % of

repairs and

maintenance

budget spent

Signed off

completion

certificate based

on the

programme

progress

monitor

%

(cum)

New 100 % of

repairs and

maintenance

budget spent

Communicat

ions

programmes

aimed at

BEE

suppliers

0,08M 8% of

repairs and

maintenanc

e budget

spent

29% of

repairs

and

maintenan

ce budget

spent

61,5 % of

repairs and

maintenance

budget spent

100% of

repairs and

maintenance

budget spent

100% of

departmental

repairs and

maintenance

budget spent

Fin

an

ce

100 % of

repairs and

maintenance

budget spent

100 % of

repairs and

maintenanc

e budget

spent

Administrati

ve system

improvemen

ts

0.07

Total 0,15

R/M

(Cum)

New R 30,889M

R 2,5M R 9M R 19M R 30,889M R 30,889M

R 32M R 33M


59


Dip

heto

go

p

rog

ram

me i

mp

act




Co

mp

an

y

Strategic

policy/

plan:

Transformation Strategy Output: Empowerment of


Strategic Objective

Total Weight

25%

Lead

er


Section 87 (MFMA)

GDS principle 5: Achieving social inclusion be facilitating

behavioral change and creating a common “Joburg identity” Strategic

priority:

Drive Socio-economic

Transformation

Outcome: BEE owned

enterprises trading

with/at JM


should ensure that the

organization is a

responsible corporate

citizen.

Mayoral priority 2: Ensure pro-poor development that

addresses inequality and provides meaningful redress

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key interventions 2018/19

Budget per

programme

Quarterly Targets

YTD

KPI

Weight

CAP

EX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20 2020/21

Strategic deliverable : Transformation at farm levels and the value chain of JM through targeted programmes and incentives

Strategic objective: Become an agent for socio-economic transformation

Ec

on

om

ic D

ev

elo

pm

en

t: I

ncre

as

ing

th

e n

um

be

r o

f

SM

ME

s a

s s

up

plie

rs t

o t

he

Cit

y

(3.1)

Complete 2

development

support

programmes

for farmers

from targeted

groups

Completion

certificate signed

off on the

completed scope

of the

programmes

number

(cum)

New 2 x

Completed

development

support

programmes

for farmers

from targeted

groups

Identification of

targeted farmers in

consultation with

Provincial

Departments of

Agriculture.

0 0.2M 0 0 1x

Completed

development

support

programmes

for farmers

from targeted

groups

2x

Completed

development

support

programmes

for farmers

from targeted

groups

2 x

Completed

development

support

programmes

for farmers

from targeted

groups

Ag

ri B

usin

ess

3x

Completed

development

support

programmes

for farmers

from targeted

groups

4 x

Completed

development

support

programmes

for farmers

from targeted

groups

Emerging farmers’

communications

programme and

accredited training.

0 1.6M

Total 0 3,1M

Ec

on

om

ic

Dev

elo

pm

en

t: T

he

roll

ou

t o

f a

Yo

uth

Sk

ills

Pro

gra

m

(3.2) No. of

jobs created

by JM and

Businesses

and SMME’s

at the JM site

Appointment

documents and

project

monitoring

reports

Number

(cum)

New 200 jobs

created

On-site training of

participants

0 0,08M 10 jobs

created by

JM and

Businesse

s and

SMME’s

at the JM

site

35 jobs

create by

JM and

Businesses

and SMME’s

at the JM

site d

110 Jobs

created by

JM and

Businesses

and SMME’s

at the JM site

200 Jobs

created by

JM and

Businesses

and SMME’s

at the JM site

200 Jobs

created by JM

and

Businesses

and SMME’s

at the JM site

Co

re o

pe

rati

on

s

250 jobs

created by JM

and

Businesses

and SMME’s

at the JM site

275 jobs

created by

JM and

Businesses

and SMME’s

at the JM site

Minor equipment 0 0,.07M

Total 0 0,150


60


Dip

heto

go

p

rog

ram

me i

mp

act




Co

mp

an

y

Strategic

policy/

plan:

Stakeholder engagement,

Marketing & communications

strategies

Output: Empowerment of


Strategic Objective

Total Weight

25%

Le

ad

er


Section 87 (MFMA)

GDS principle 6: Promoting good governance

Strategic

priority:

Develop JM into a high

performance organization

Outcome: BEE owned

enterprises trading with/at

JM

5.1: As part of its decision –

making in the best interests

of the organization, the

governing body should

ensure that a stakeholder-

inclusive approach is

adopted, which takes into

account and balances their

legitimate and reasonable

needs, interests and

expectations

Mayoral priority 3: Create a culture of enhanced service

delivery with pride

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

intervention

s

2018/19 Budget


YTD

KPI

Weig

ht CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20 2020/21

Strategic deliverable : Good Governance

Strategic objective: Ensure effective stakeholder engagement

Eco

no

mic

Dev

elo

pm

en

t:

Th

e s

ign

ific

an

t im

pro

ve

men

t

in t

he e

as

e a

nd

exp

eri

en

ce o

f d

oin

g b

usin

es

s in

th

e

Cit

y

(4.1) %

resolution of

stakeholder

concerns

(customer

satisfaction

survey)

Quarterly reports

Concluded

Satisfaction

survey results

%

(cum)

New 70 % resolution

of stakeholder

concerns

(customer

satisfaction

survey)

1 x survey

Develop a

new pan for

stakeholder

management.

conduct

meetings with

key

stakeholders

to get deeper

understanding

of concerns of

all

stakeholder

groups

Develop a

new survey

approach for

customer

satisfaction

measurement

0 0 - - - 70 %

resolution of

stakeholder

concerns

(customer

satisfaction

survey)

70 % resolution

of stakeholder

concerns

(customer

satisfaction

survey)

Str

ate

gy

80%

customer

satisfaction

achieved as

per survey of

overall

satisfaction

90%

customer

satisfaction

achieved as

per survey of

overall

satisfaction

Total

0

180 000

1 X survey 1 x survey


61


Dip

heto

go

p

rog

ram

me i

mp

act

National outcome 9: A responsive, accountable,

effective and efficient local government system.

Co

mp

an

y

Strategic

policy/plan:

Financial sustainability

strategy

Output: Improved surplus

generation King IV Principle

Strategic Objective

Total Weight

25%

Lead

er


Section 87 (MFMA) GDS principal 4: Ensuring resource security and

environmental sustainability. GDS principle 6:

Promoting good governance Strategic

priority:

Financial sustainability and

growth

Outcome: Liquid going

concern


should govern compliance

with laws and ensure

consideration of

adherence to non-binding

rules, codes and standards

Mayoral priority 7: Enhancing our financial

sustainability

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

interventions

2018/19 Budget


YTD

KPI

Weight CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20 2020/21

Strategic deliverable : Good governance

Strategic objective: Become a high-performance organisation

Ec

on

om

ic D

ev

elo

pm

en

t:

Inc

rea

sin

g

the

nu

mb

er

of

SM

ME

s a

s s

up

pli

ers

to

the

Cit

y

(5.1) % of

valid

departmental

invoices paid

within 30 days

of invoice

date

Creditors

payment

report

%

(cum)

New 100% of valid

departmental

invoices paid

within 30 days

of invoice

date

Creditor

communications

0 O,09M 100% of valid

departmental

invoices paid

within 30 days

of invoice date

100% of valid

departmental

invoices paid

within 30 days

of invoice date

100% of valid

departmental

invoices paid

within 30 days

of invoice date

100% of valid

departmental

invoices paid

within 30 days

of invoice date

100% of valid

departmental

invoices paid

within 30 days

of invoice date

Fin

an

ce

100% of valid

departmental

invoices paid

within 30 days

of invoice date

100% of valid

departmental

invoices paid

within 30 days

of invoice date

R/M

(cum)

New R56,12M Total 0 O,09M R14.0M R28M R42,1M R56,12M R56,12M R61,9M R63,3M

Ec

on

om

ic D

ev

elo

pm

en

t:

Th

e

sig

nif

ica

nt

imp

rov

em

en

t in

th

e e

ase

an

d e

xp

eri

en

ce

of

do

ing

bu

sin

es

s in

the

Cit

y

(5.2) %

resolution of

Auditor

General and

Internal Audit

findings

Final AG

report and

final

Internal audit

report

AG

opinion

And

Internal

Audit

reports

Unqualified

audit

95 %

resolution of

Auditor

General and

Internal Audit

findings

Validation of

resolved

findings by

internal audit

0 0 30 %

resolution of

Auditor

General and

Internal Audit

findings

50 %

resolution of

Auditor

General and

Internal Audit

findings

75 %

resolution of

Auditor

General and

Internal Audit

findings

95 %

resolution of

Auditor

General and

Internal Audit

findings

95 %

resolution of

Auditor

General and

Internal Audit

findings

96 %

resolution of

Auditor

General and

Internal Audit

findings

97 %

resolution of

Auditor

General and

Internal Audit

findings


62


Dip

heto

go

p

rog

ram

me i

mp

act National outcome 7: Vibrant, equitable and sustainable rural

communities with food security for all.

Co

mp

an

y

Strategic

policy/plan:

JM: Food support strategy

Output: Increased

number of food parcels

distributed

King IV Principle

Strategic Objective

Total Weight

15%

Lead

er


Section 87 (MFMA)

GDS principle 1: Reducing poverty

Strategic

priority:

Ensuring food safety and

security as CSI initiative

Outcome: Effective pro

poor support



organization is a

responsible corporate

citizen

Mayoral priority 2: Ensure pro-poor development that addresses

inequality and provides meaningful redress

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

interventio

ns

2018/19 Budget


YTD

KPI

Weig

ht CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20 2020/21


• Strategic objective: Become an agent for socio-economic transformation

So

cia

l S

erv

ices:

Th

e e

xp

an

sio

n o

f fr

ee b

asic

serv

ices t

o t

ho

se i

n g

reate

st

need

wit

h t

he

Cit

y's

ES

P

(6.1) Number of

donations to

targeted

beneficiaries from

NGOs, NPOs and

indigent families

Quarterly

report, Annual

reports and

Audited reports

Number

(cum)

New 12500

Number of

donations to

targeted

beneficiaries

from NGOs,

NPOs and

indigent

families

Procurement

, sorting and

packing of

food

donations

0.750M 2000

Number of

donations

to targeted

beneficiari

es from

NGOs,

NPOs and

indigent

families

4500

Number of

donations to

targeted

beneficiaries

from NGOs,

NPOs and

indigent

families

9500

Number of

donations to

targeted

beneficiaries

from NGOs,

NPOs and

indigent

families

12500

Number of

donations to

targeted

beneficiaries

from NGOs,

NPOs and

indigent

families

n

12500

Number of

donations to

targeted

beneficiaries from

NGOs, NPOs and

indigent families

Ag

ri-B

usin

ess

13000

Number of

donations to

targeted

beneficiaries

from NGOs,

NPOs and

indigent

families

14500

Number

of

donation

s to

targeted

benefici

aries

from

NGOs,

NPOs

and

indigent

families


63


CO

J ID

P P

rog

ram

me

National outcome 9: A responsive,

accountable, effective and efficient local

government system.

Co

mp

an

y

Strategic

policy/plan: Financial sustainability strategy

Output: Improved

surplus generation

King IV Principle

Strategic Objective

Total Weight

20%

Lead

er


Section 87 (MFMA)

GDS Principle 4: Ensuring resource security and

environmental sustainability

Strategic

priority:

Financial sustainability and

growth

Outcome: Liquid going

concern


should lead the value

creation process by

appreciating that strategy,

risk and opportunity,

performance and

sustainable development

are inseparable elements

Mayoral priority 7: Enhancing our financial

sustainability

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

interventions

2018/19 Budget


YTD

KPI

Wei

ght CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4

2019/20 2020/21

Strategic deliverable : Investment in infrastructure – R1.2 billion infrastructure spend by 2022

Strategic objective: Operate a sustainable resilient premier marketing and trading facility

(7.1) % of

departmental

capital budget

spent

% of spending

level of CAPEX

against demand

plan

%

(cum.)

52,9% 100%

of

department

al capital

budget

spent

Specialist

coaching &

training

0,7M 16%

of

departmen

tal capital

budget

spent

35% of

departmen

tal capital

budget

spent

62% of

departmenta

l capital

budget

spent

100%

of

departmenta

l capital

budget

spent

100% of

departmental

capital budget

spent

Fin

an

ce

100% of

departmental

capital budget

spent

100% of

departmental

capital

budget spent Capex

spending

R52,9M

Capex

spending

workgroup

refinement

0 0,5M

R/M

(cum)

R59.3M

R52,9M R8.5M

R18.5M R32.9M R52,9M

R52,9M R51,2M

R2,2M

(7.2) % of

departmental

operational

budget spent

Financial

Statements

%

(cum)

New 100% of

department

al

operational

budget

spent

Monthly &

quarterly

variance

analysis

0 0 15% of

departmen

tal

operational

budget

spent

49% of

departmen

tal

operational

budget

spent

72% of

departmenta

l operational

budget

spent

100% of

departmenta

l operational

budget

spent

100% of

departmental

operational

budget spent

100% of

departmental

operational

budget spent

100% of

departmental

operational

budget spent

R/M

(cum)

New

R64,548M Management

reporting as

early warning

R9.952M R31.997M R46.723M R64,548M R64,548M R73.689M R95.265M

(7.3) Value of net

surplus achieved

Financial

Statements

R/M

(cum.)

R81,17M

Value of

net

surplus

achieved

R64,5M

Value of net

surplus

achieved

- - - R8,0M

Value of

net surplus

achieved

R14,5M

Value of

net surplus

achieved

R39M Value

of net

surplus

achieved

R64,5M

Value of net

surplus

achieved

R64,5M Value of

net surplus

achieved

R71M Value

of net surplus

achieved

R72M Value

of net surplus

achieved


64


CO

J

IDP

Pro

gra

mm

e

National outcome 4: A skilled and capable workforce to

support an inclusive growth path

Co

mp

an

y

Strategic

policy/plan:

Human Resources Strategy Output: Leadership- and

skills development King IV Principle

Strategic Objective

Total Weight

15% Lead

er

Multiyear

predictions

Section 87 (MFMA)

GDS Principle 5: Achieving social inclusion by facilitating

behavioral change and creating a common “Joburg identity”

and Principle 6: Promoting good governance

Strategic

priority:

Productive, motivated and engaged

employees

Ensuring food security and safety

Outcome: Expert

employees in Market

operations

4.4: the governing body


organization remunerates

fairly, responsibly and

transparently so as to

promote the creation of

value in a sustainable

manner

Mayoral priorities 3: Create a culture of enhanced service

delivery with pride

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

interventio

ns

2018/19 Budget


YTD

KPI

Weigh

t CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20

2020/

21



Pil

lar

5 –

In

sti

tute

an

ho

ne

st

res

po

ns

ive

an

d p

rod

uc

tive

go

ve

rnm

en

t

(8.1) % of

employees

receiving

performance

coaching and

review as per the

policy

Training plan as

identified in the

individual

Personal

Development

Plans.

% (cum)

New 100% of

employees

receiving

performance

coaching and

review as per

the policy

Leadership

development

programme

0 1.12M 10% of

employees

receiving

performanc

e coaching

and review

as per the

policy

30% of

employees

receiving

performance

coaching and

review as per

the policy

70% of

employees

receiving

performance

coaching and

review as per

the policy

100% of

employees

receiving

performance

coaching and

review as per

the policy

100% of

employees

receiving

performance

coaching and

review as per the

policy

Sh

are

d S

erv

ice

s

100% of

targeted

staff

members

trained

100% of

targeted

staff

members

trained

Total 0 1,12M 1 2 4 7 7 8 9

(8.2) Number of

days taken to

resolve

disciplinary cases

Record of findings

at hearings

No of

days

New 120 days

taken to

resolve

disciplinary

cases

0 0 120 days

taken to

resolve

disciplinary

cases

120 days

taken to

resolve

disciplinary

cases

120 days

taken to

resolve

disciplinary

cases

120 days

taken to

resolve

disciplinary

cases

120 days taken to

resolve

disciplinary cases

120 days

taken to

resolve

disciplinar

y cases

120

days

taken

to

resolve

discipli

nary

cases

Total 0 0

(8.3) Number of

days taken to fill

critical vacancies

Signed

appointment

letters

No of

days

New 90 days taken

to fill crucial

vacancies

Performance

Management

System

implementation

0 0,265M 90 days

taken to fill

crucial

vacancies

90 days

taken to fill

crucial

vacancies

90 days

taken to fill

crucial

vacancies

90 days

taken to fill

crucial

vacancies

90 days taken

to fill crucial

vacancies

90 days

taken to

fill crucial

vacancie

s

90 days

taken to

fill

crucial

vacanci

es

Pill

ar

4 –

Bu

ildin

g

Ca

rin

g S

afe

an

d

Se

cu

red

Co

mm

un

itie

s

(8.4) % of

departmental

performance

targets achieved

Monitoring and

Evaluation

certificate

% cum New

85% Legal

Appointments

0 0.378M 85% of

department

al

performanc

e targets

achieved

85% of

departmental

performance

targets

achieved

85% of

departmental

performance

targets

achieved

85% of

departmental

performance

targets

achieved

85% of

departmental

performance

targets achieved

Sh

are

d S

erv

ices

75% of

departmen

tal

performan

ce targets

achieved

75% of

departme

ntal

performa

nce

targets

achieved


65


CO

J

IDP

Pro

gra

mm

e

National outcome 4: A skilled and capable

workforce to support an inclusive growth path

Co

mp

an

y

Strategic

policy/plan:

Human Resources Strategy Output: Leadership- and

skills development King IV Principle

Strategic Objective

Total Weight

15%

Lead

er

Multiyear

predictions

Section 87 (MFMA)

GDS Principle 5: Achieving social inclusion by

facilitating behavioral change and creating a

common “Joburg identity” and Principle 6:

Promoting good governance Strategic

priority:

Productive, motivated and

engaged employees

Ensuring food security and

safety

Outcome: Expert

employees in Market

operations


should govern

technology and

information in a way that

supports the organization

in defining core purpose

and to set and achieve

strategic objectives

Mayoral priorities 3: Create a culture of enhanced

service delivery with pride

KPI Means of

verification

Unit of

measure Baseline

Target

2018/19

Key

interventio

ns

2018/19 Budget


YTD

KPI

Weigh

t CAPEX

R/M

OPEX

R/M Q1 Q2 Q3 Q4 2019/20

2020/

21



Pill

ar

5 –

Institu

te a

n h

on

est re

sponsiv

e a

nd p

rod

uctive

govern

ment

(8.5) %

implementation

of the electronic

business plan

management

system (SAP

SSM)

Training plan as

identified in the

individual

Personal

Development

Plans.

% (cum)

New 100% of

targeted staff

members

trained

10% of

targeted

staff

members

trained

30% of

targeted

staff

members

trained

70% of

targeted

staff

members

trained

100% of

targeted

staff

members

trained

100% of

targeted staff

members

trained

Share

d S

erv

ices

100% of

targeted

staff

members

trained

100% of

targeted

staff

member

s trained

No.

(cum)

No.

(cum)

7 members 3

members

5 members 6 members 7 members 7 members 8

members

9

member

s

(8.6) % monthly

reporting into

Capital

Management

System (iRIS)

Level of staff

remuneration to

OPEX

%

(cum)

new % monthly

reporting into

Capital

Management

System

(iRIS)

100%

monthly

reporting

into Capital

Manageme

nt System

(iRIS)

100%

monthly

reporting

into Capital

Managemen

t System

(iRIS)

100%

monthly

reporting

into Capital

Managemen

t System

(iRIS)

100%

monthly

reporting

into Capital

Managemen

t System

(iRIS)

100% monthly

reporting into

Capital

Management

System (iRIS)

100%

monthly

reporting

into

Capital

Manage

ment

System

(iRIS

100%

monthly

reportin

g into

Capital

Manage

ment

System

(iRIS

1x Report 2x Report 3x Report 4x Report 1x Report 1x

Report

1x Report 1x

Report


66


ANNEXURE 2: CROSS CUTTING ACTIVITIES

JM is primarily supporting the agriculture and food security priorities stemming from the nature of its business. However, partnerships with other

CoJ functions bring about opportunities to add value to the overall programme and in this regard the cross cutting elements are listed in the table

below.

Role of DED as cluster and cross cutting activities of JM

City Priority 3:- Agriculture and Food

security

CoJ: Departments: Health and Social

Development

CoJ Entities

City Priority 2

pro-poor

Pro poor development Social Development

Department

Human

Development

Department

Pikitup City Parks Johannesburg

Development

Agency

DED Role • Expand commercial

urban agriculture

• Disposal of land for

agricultural purposes

• Integrate cooperatives

into the agricultural

value chain and into the

CoJ Food Security

programme

o o o o o

Programmes/P

rojects

• SMME and

Entrepreneurship

Development,

o o o o o


67



security


Development

CoJ Entities

City Priority 2

pro-poor


Department

Human

Development

Department


Development

Agency

Cooperatives Support,

Township Economic

Development

JM • Sustain agricultural

stakeholder

relationships and link

them to emerging

producers/agents

• Train urban farmers on

how to use JM as

trading point

• Participate in Local Agri-

forums

• Develop pack houses

for BEE entrepreneurs

at the JM site

• Develop distribution

centres in collaboration

with JDA

• Indigent food parcel

preparation and

distribution

• Donation of seeds to

produce food in food

gardens

• Sponsor

lifestyle

programmes

with fruit and

vegetables

• Prepare and

supply “food for

Waste” food

parcels

• Donation

of seed

received

from seed

producers

o


68



security


Development

CoJ Entities

City Priority 2

pro-poor


Department

Human

Development

Department


Development

Agency

JPC • SMME and Co and

Informal Economy

Support

• Dispose land for urban

agriculture and Agro

processing through JPC

• Implement the

Township Economic

Development Plans

focusing on agro

processing hubs, food

empowerment zones.

o o o o o


_________________________________________________________________________

69


ANNEXURE 3: EXECUTIVE MANAGEMENT TEAM

The Executive Committee of the Joburg Market consists of the following members:

Mr Ayanda Kanana – Chief Executive Officer

Ayanda Matriculated in 1999 and as sports lover played cricket for Kagiso

Cricket Club and later became Chairman of the Club. He Studied at Wits

University – was known as an active student –and served as Deputy

Chairperson of the Commerce Council. He further fulfilled the positions of

Chairperson of the House Committee at Barnato Hall.

He completed his articles at Deloitte and represented African Trainees in

this sphere. During his training he was generally rated as exceeding

expectations. During his training period as Audit & Learning Manager, he

developed new training concepts – S.W.A.T (Special Weapons & Tactics

training for audit trainees).

Ayanda continued to serve in various capacities and inter alia served on the Gauteng Cricket

Finance Committee. He joined the City of Johannesburg in 2010 serving from a governance

perspective on Audit Committees – City Parks & Zoo; Johannesburg Social Company; Mogale

City Local Municipality and the Randfontein Local Municipality. He further represented the

Audit Committee Chairman at the Group Audit & Group Risk Governance Committees of the

City of Johannesburg.

As Board member & Audit Committee member he was elected to ELIDZ – 2012, served as

Chairperson of the Audit Committee ELIDZ – 2016 and took up the responsibilities of

Chairperson of the Task Team for the financial turnaround of ELIDZ. From 2012 onwards

Ayanda served in the following capacities:

Support CFO at South West Gauteng College SWGC – 2012;

Director for Governance & Reporting at the City of Johannesburg Governance

Department – 2013;

Audit Committee member at SWGC – Invited back to contribute to the College;

Member of the SAICA Ethics Committee since 2017 – representing the public sector;

Appointed as the Acting Managing Executive at Metro Trading Co. – the Broadband

Company for CoJ – 2017.

As auditor he supported efforts towards assuring the general health of internal controls in local

government and focused on skills shortfalls. He prepared Clean Audit Plans for the

Municipalities that he has served. In particular he contributed to the Clean Audits for Mogale

City at the time, then Joshco, and recently for ELIDZ

Pertinent to enabling human resource capacity he has been tasked with the role of bringing

skills to local government:


_________________________________________________________________________

70


• As part of Group Governance, he started a unit that hires professionals who look after

the shareholder interests;

• Started the CoJ #JoburgCAs programme as the first Training Officer for the CoJ in

this sphere which was conducted previously under National Treasury arrangements.

The City of Johannesburg is a R60 billion organization and needs the right skills in order to

ensure that it realizes clean audits – this is not a simple task – and Ayanda was entrusted with

reducing the Management Letter findings. He has been instrumental in the 2011 institutional

review of CoJ and now will be part of the reabsorption activities of the municipal entities into

departments as per the 2017 institutional review.

Ayanda is known for pursuing the drive to create a skills base for young professionals in local

government. He is a stern believer in hard work. This is evident in him becoming the youngest

Executive in the Executive Management Team, leading the Metro Trading Company – a

Broadband entity with 1150 km of fiber around Johannesburg.

He is looking forward in his new role to grow the JM beyond its current capacity and to create

linkages so that the entity can realize the dream of a 1-Gauteng Region able to ensure food

security. Linked to the latter is his dream of implementing unique programmes to grow

emerging farmers in Gauteng.

Mr Sifiso Dlamini – Chief Financial Officer

CFO to submit short CV.

Mr Josiah Mazibuko – Executive Manager Core Operations

Joe Mazibuko is the Chief Executive Officer (Acting) at the Joburg Market. He was appointed

as the Executive Manager: Core Operations from 1st October 2014 and was requested to

assume the acting role on 1 July 2015. He chairs the Executive Committee of the Joburg

Market.

Joe has over 25 years' experience working in industries such

as the energy, information and communication Technology,

Local Government, Engineering and management

consulting and has occupied a number of key executive and

senior management roles in both the public and private

sector entities.

He has amassed extensive knowledge in the management

of large, complex, multi-million rand projects in various

organisations. His main area of specialisation is Operations

Management, Business Strategy Development &

Implementation Management, System Implementation and Strategic Management Consulting.

As the Chief Executive Officer (Acting) of Joburg Market, his key job functional outputs entail

amongst others:


_________________________________________________________________________

71


Leading and directing JM’s business, consistent with the strategy and commercial

objectives agreed by the Board.

Leading the executive team in effecting the Board's, and where applicable its

Committees', decisions.

Ensuring that the Board is alerted to forthcoming complex, contentious, emerging or

sensitive issues affecting JM of which they might otherwise not be aware.

Working with other executives, for proposing, developing, implementation and

monitoring of JM’s strategy and overall commercial objectives, in consultation with the

Chairman and the Board.

In delivering JM’s strategic and commercial objectives the Chief Executive Officer is

responsible for the maintenance and protection of the reputation and image of the

Company.

Apart from other short term certificates, Joe counts amongst his qualifications the following:

• A Master of Science Degree in Engineering Management from the University of

Warwick;

• A Senior Managers Programme from Henley Business School;

• An Information Technology Leadership Programme from the WITS Graduate

School of Business Administration;

• A Management Development Programme from the University of South Africa; and

• A National Diploma: Electrical Engineering.

• International Leadership Development: Henley Business School.

Mr Tshifhiwa Madima – Executive Manager: Agri-Business

Tshifhiwa Madima is the Executive Manager: Agri-Business. He was appointed into his current

position on 1st November 2014 and is a Member of the Executive Committee of the Joburg

Market.

As the Executive Manager: Agribusiness, Tshifhiwa is tasked

with the following responsibilities:

the development and implementation of Food Security

and Agro Processing strategies aligned with the City of

Johannesburg;

the development of the Agricultural Intelligence resource

centre with in the Joburg Market; and

the development of agro industry enterprises .

Tshifhiwa is an Agricultural Economist by profession and has over 15 years’ experience in the

Agricultural Sector. Part of his work experience includes the following;

Researcher in the Land Reform Unit: Land and Agriculture Policy Centre;

Agricultural Economist: Limpopo Department of Agriculture;

Head: Field Crop Section: National Agricultural Marketing Council;


_________________________________________________________________________

72


Manager: Agriculture, Food and Beverages: Industrial Development Corporation; and

Director: Agro-processing at the Department of Trade and Industry.

Senior Technical Project Manager: CapaCity Building: Food and Agriculture

Organization of the United Nations in South Africa,

Tshifhiwa counts as part of his qualifications the following;

Master’s Degree: Agricultural Economics: University of Pretoria.

Honours Degree in Agricultural Economics: University of Pretoria.

Bachelor of Agricultural Management degree: University Limpopo.

International Leadership Development: Henley Business School.

Municipal Executives Finance Management: WITS Business School.

Ms Sibongile Motloung: Senior Manager: Internal Audit

Ms Sibongile Motloung is the Senior Manager: Internal Audit. Sibongile joined the JM on 1st

October 2016 and is also a Member of the Executive Committee.

As Senior Manager: Internal Audit, Sibongile has, amongst

others, the following responsibilities;

Establishing appropriate policies and procedures to

guide the internal audit function

Ensuring that the internal audit unit is appropriately and

sufficiently resourced to achieve its operational

objectives

Providing assurance to management, the Audit and Risk

Committee and the Board, on the effectiveness of risk

management, governance and internal control

processes of the Joburg Market;

Coordinating assurance activities through implementation of a Combined Assurance

Framework

Ensuring that the internal audit function carries out its work in conformance with the

professional internal auditing standards;

Sibongile is a Certified Internal Auditor by profession and has over 17 years’ internal auditing

experience. She previously worked for:

SEDA as Chief Internal Auditor

Gauteng Treasury as Chief Director Risk and Compliance Audit

KPMG as Senior Manager Internal Audit

Afrox as Project Manager Internal Audit

Sibongile holds the following qualifications:

Certified Internal Auditor (CIA);

Certification in Self-Control Assessment (CCSA)

Honours Degree in Business Management;

Bachelor of Commerce.


_________________________________________________________________________

73


ANNEXURE 4: SERVICE DELIVERY AGREEMENT BETWEEN THE COJ & COMPANY

Joburg Market

Core Service Service Level Standard

1. Opening a new buyer account Within 20 minutes

2. Electronic Sales Processing System

disruptions

Mirror/back-up 12w system to go live:

within 55 minutes

3. Time to resolve cashiering queries

when clients are depositing

money

Resolution of depositing queries within 30

minutes

4. Repairs of infrastructure facilities Commencement of repairs on reported

infrastructure breakdown within 24 hours

5. Repairs to ripening facilities 95% availability of banana ripening

rooms

6. Cold Room facilities

Average temperature variance not

greater than 10% of agreed customer

requirements

7. Stakeholder complaints Response within 12 response

Resolution within 48 hours


74


ANNEXURE 5: ORGANISATIONAL STRATEGIC RISK REGISTER – To be replaced with cleaned up register once Board approves

Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action

Owner Update Time scale

1

Ensure

Financial

sustainabil

ity and

growth of

the entity

Strategic Revenue

Stagnant/

Low

growth

1. Inadequate

trading

infrastructure

2. Legislative/

HACCP

requirements

3. Limited

new revenue

streams

4. Poor

trading floor

space

management

1. Business

closure

2. Financial Loss

Critica

l

5

Alm

ost C

ert

ain

or

Co

mm

on

5

Very

Hig

h

25

1. Monthly

assessments of

current industry

practices

2.

Benchmarking

Poor

0.90

Very

Hig

h

22.

5

5 4.5

CEO

1. Develop a

business case for

space optimisation

2. Development of

the implementation

plan for space

optimisation

3. Develop of the

Agro processing hub

4. Upgrading for halls

1. 2 and-9 optimise

to strengthen the

core business

Executive

Core

Operation

1. Business

case finalised.

Will be

presented to

EXCO

2. Space

Optimisation

Project awaits

signing of SLA

with JPC

3. HACCP

compliant -

Conceptual

documents

finalised.

4. HACCP

compliant -

Awaits signing

of SLA with

JPC

31 July

2018

31 July

2018

31 July

2018

Quarterly

monitoring

2

Operate a

sustainabl

e resilient

premier

marketing

and

trading

facility

Asset

Loss

Ageing

infrastruct

ure and

maintenan

ce

backlog

1. Reactive

maintenance

due to

backlog

2.

Outstanding

preventative

maintenance

plans

3. Inadequate

internal

capacity

4. Poor

maintenance

of facilities

5. Poor

trading floor

management

1. Inability to

keep up with

industry

requirements

2. Possible non-

compliance

resulting in

possible injuries,

loss of life, loss of

income,

penalties, fines,

litigation and

insurance claims

3. Damage to

reputation

4. Possible

reduction in

supply of fresh

produce and

corresponding

loss of revenue

5. Increase in

direct sales

6. Decrease in

Critica

l

5

Alm

ost C

ert

ain

or

Co

mm

on

5

Very

Hig

h

25

1. CAPEX and

OPEX

structures

established to

monitor

spending on

maintenance

2. Independent

contractor for

plumbing has

been appointed

3. Appointed

additional

technical

resources

internally

4. Appointed

engineering

service

providers to

oversee the

maintenance of

the ammonia

plant

Poo

r 0.90

Very

Hig

h

22.

5

5 4.5 CEO 1. Two remaining

disciplines to be

appointed for

preventative

maintenance to

address the back log.

2. Team for proactive

maintenance

identified to monitor

schedule and be

seen as proactive by

the tenants.

Executive

Core

Operation

1.

Appointment

of Building &

Civil

Contractors at

an advanced

stage.

Awaiting

award

2. Repairs &

maintenance

have been

expedited. R

9.7 million

spent in

quarter 1 of

2017/2018

31 Aug

2018


75


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


customer

satisfaction levels

7. Increased

pressure from

stakeholders

5. Preventative

maintenance

plan in place

3

Ensure our

staff are

engaged,

skilled,

motivated

and

satisfied

Human

Capital

Demotivat

ed staff /

Poor

performan

ce and

productivit

y

1. Low staff

morale

2. Salary

discrepancies

3.

Inconsistent

application of

policies

4. Lack of

consequence

management

5. Lack of

constant

review of the

policies

6. Inadequate

communicatio

n

1. Loss of

institutional

knowledge

2. Increased

workload on

existing

employees

3. Negative

impact on service

delivery

4. Operational

inefficiencies

Critica

l

5

Alm

ost C

ert

ain

or

Co

mm

on

5

Very

Hig

h

25

1. Approved

and

implemented

talent

management

policy

2. Individual

training and

development

plans

3. Identified

training

programs, KPI

measured

monthly

Poor

0.90

Very

Hig

h

22.

5

5 4.5 CEO 1. Formal follow up

and communication

with the Shareholder.

2. Implementation of

the agreements.

3. and

4. Intensify

awareness training

around policies.

Update the M drive

with the new and

updated policies.

5. Adopt

consequence

management

framework from the

CoJ and the

implementation

thereof.

6. Constant review of

policies. Intensify

frequency of

departmental

meetings and

reporting to Exco by

management of

meetings held

inclusive of

submission of

minutes of the

meeting

7. Investigate

possibility of posting

policies on intranet

Shared

Services

Executive

Executive

Strategy &

Transform

ation

1-2.

Shareholder

agreements

implemented

3. Approved

policies

posted on m-

drive and

communicated

to employees

4. Documents

to serve at

EXCO and

Board

5.Policy

reviews due in

2nd quarter

6. Staff

meetings to

resume with

new CEO

7. Workshop

with IT

1.31 July

2018

2.31 July

2018

3. 30 Sep

2018

4. 31 Aug

2018

5.30 July

2018

6. 30

September

2018

7. 30

September

2018

4

Become

an agent

for socio-

economic

transforma

tion

Operation

al

Failure to

meet

sharehold

er

expectatio

n as per

the

service

1. Lack

trading space

to attract

emerging

black agents.

2. Access to

the market by

the emerging

1. Business

closure

2. Financial Loss

Critica

l

5

Lik

ely

4

Very

Hig

h

20

1. System

processes

reengineered

Poor 0.90

Hig

h

18

5 3.6 CEO 1. Develop a

business case for

space optimisation:

2. Development of

the implementation

plan for space

optimisation:

3. Continuous

1-2

Executive

Core

Operation

Executive

Agri

business

1. Business

case

developed.

Awaits

presentation

to EXCO

2. Space

Optimisation

15 Aug

2018

30 Sep

2019

30 May

2019

30 April

2019


76


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


delivery

agreemen

t

Farmers

3. Inadequate

utilisation of

the floor

space

(tenants

allowed to

use their own

cold storage

encroaching

on space that

could be

utilised for

new tenants)

4. No long

term

commitments

with

funders/partn

ers to drive

the food

security

program

5. SDA not

signed by all

parties

6. Lack of

enterprise

and

development

strategy.

7. Low

productivity

by internal

service

provider

(Increase

down time,

attendance

transgression

s, late

delivery of

outputs and

reports, poor

communicatio

n an security

provision)

implementation of

access programs

4. Negotiate long

term MOA with the

funders/partners

(CoJ and DSD)

5. Facilitate the

signing of the SDA

6. Development and

Implementation of

the Enterprise

Development

strategy

7. Consequence

Management for

poor performance

8. Documentation of

business processes,

identification of gaps

9. Proper monitoring

systems designed,

implemented and

provide accurate

audit trail

10. Implementation

of process flows that

streamline how

projects are rolled

out and initiated

Executive

Agri

business

Executive

Strategy

and

Transform

ation

Project awaits

signature of

SLA with JPC.

3. Market

access

program

implemented

in Limpompo

(Bela-Bela

and Tompi

Seleka

College)

4. Annual SLA

with CoJ DSD

developed and

submitted to

CEO's office

for approval

15 June

2019

31 June

2019


77


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


5

Regulator

y

Noncompl

iance to

OHS Act

and GMR

1. Inadequate

capacity

2. Inadequate

systems

3. Lack of

enforcement

and

monitoring

4. Culture of

Apathy

5. Lack of

accountability

1. Possible

litigation, fines

and penalties

resulting in a

financial loss

2. Possible loss

of life or injury on

duty

3.Possible

closure of the

Market

4.Loss of fresh

produce supply

5.Possible audit

qualification

6.Damage to

reputation

Critica

l

5

Alm

ost C

ert

ain

or

Co

mm

on

5

Very

Hig

h

25

1. Enforcement

of the Market

By-law

2. Focus

groups

provided with

specific training

in respect of

legislations

applicable to

these groups.

3. Interaction

with DAFF

legislations

(Department of

Agriculture

Fisheries and

Forestry)

4. Yearly

assessment of

the Laboratory

to comply with

the Food safety

standards

(SANAS

accreditation

retained)

Fair 0.50

Hig

h

12.

5

5 2.5 CEO 1. Develop a

business case for

motivation for the

budget (Capacity and

systems)

2. Awareness

campaign

3.Enforcement of the

by-laws

Shared

Services

Executive

31 Aug

2018

6

Business

Continuity

Business

interruptio

n/s

1. Power

outages

2. Water

supply

disruptions

3. Industrial

action

4. Failing /

unavailability

of trading

platform

(SPS)

5. Natural

disasters

6. Lack of

business

continuity

plans

1. Loss of

revenue

2. Damage to

reputation

3. Increase in

insurance claims

4. Possible loss

of life or injury

5. Possible

damage to

infrastructure

6. Down time of

the market

resulting in

dissatisfied

customers and

increased

pressure from

stakeholders /

business partners

Critica

l

5

Alm

ost C

ert

ain

or

Co

mm

on

5

Very

Hig

h

25

1. Onsite UPS

and generators

(weekly testing

of generators)

2. LLF (Local

labour forum)

has been

established and

functioning

3.Labour

agreements

and monthly

meetings with

labour forums

4. Fire

suppression

systems and

fire

extinguishers

which are

Fair 0.50

Hig

h

12.

5

5 2.5 CEO 1. Finalisation and

implementation of a

clear outage

management

communication

strategy:

2. Appointment of

PSP to provide

rational designs for

portable water and

automatic fire

suppression:

3.Implementation of

the Business

Continuity strategy

/Business Impact

Analysis/Disaster

Recovery Plans

4. Installation of

additional firefighting

Core

Operations

Shared

Services

1. Power

outages are

effectively

managed with

clear

management

communicatio

n plans been

implemented.

For planned

outages,

proactive

communicatio

ns are

provided to

stakeholders.

For unplanned

outages, an

electronic

communicatio

Quarterly

Quarterly

In place

30

Septermbe

r 2018

30

November

2018


78


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


7. Increase in

fraud related

activities

8. Temporary loss

of data integrity or

availability

9. Fragmented

communication

and confusion /

disorder

10. Delayed

recovery due to

ineffective crises

management

serviced

annually

5. Duplicate

trading platform

(tested

quarterly)

6. Continuous

engagement

forums with

utility suppliers

(water and

electricity) and

EMS, Joburg

market

management

and agent’s

forum

7. Redundancy

of SPS (Sales

Processing

System) has

been created

and is

monitored &

synchronised in

real time

8. Short term

insurance with

AON

9. Continuous

testing of

evacuation

procedures and

conducting

evacuation

drills

10. Gen farm

has been

completed and

commissioned

11. JM has a

hotline with City

Power to

resolve

outages. All

queries a

logged and City

equipment in the

market as per

legislation:

5. Installation of fire

sprinklers in the

entire market:

6. Duplicate SPS

infrastructure tested

quarterly

n channel has

been

developed and

implemented.

It consist of all

the key

stakeholders.

2. A PSP has

been

appointed.

The Potable

water and Fire

Suppression

Project is

being

implemented.

Completion

and hand-over

scheduled for

December

2017

3. BCM has

not been

allocated

budget

4.The fighting

tender was

awarded and

the SLA was

approved by

EXCO

5. The storage

tanks project

is underway.

once the

storage tanks

are

commissioned

, the sprinklers

will be

installed.

6.Fail-over to

duplicate SPS

trading

platform was

tested

successfully


79


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


Power issues a

reference

number and are

resolved within

12 hours

12. Quarterly

staff meetings

and regular

EXCO

meetings and

update on

business

continuity

measures

on the 19th

September

2017

7

Ensure

effective

stakeholde

r

managem

ent

Stakehold

er

Managem

ent

Ineffective

stakehold

er

engagem

ent

1.

Stakeholder

engagement

plans has not

been

implemented

2.

Unstructured

and poor

coordination

of stakeholder

management

responsibilitie

s

3.Miscommun

ication and

lack of

consistent,

standard

messages,

feedback to

the

stakeholders

4. No

alignment,

integration,

and

understanding

of our

stakeholders

5. Slow

reaction to

client request

1.Dissatisfied

stakeholders

2.Increased

pressure from

stakeholders

3.Negative

perception of JM

leading to

damage to

reputation

4.Operational

inefficiencies i.e.

delay in project

approvals etc.

Critica

l

5

Lik

ely

4 V

ery

Hig

h

20

1. Completed

and updated

stakeholder

matrix

2.Stakeholder

forums in

certain areas

together with

quarterly

reporting

3.Approved and

implemented

shareholders

compact

together with

quarterly

reporting

4.Attendance of

industry related

events, grower

associations /

forums and

symposiums

5. Annual

stakeholder

satisfaction

survey

conducted.

Customer

Satisfaction

Survey

completed with

focus on

Fair 0.50

Mo

dera

te

10

5 2 CEO 1. Implementation of

the stakeholder

management plan

2- 4 Define the

responsibilities and

provide training and

awareness

Executive

Strategy

and

Transform

ation

1. The

Stakeholder

management

plan is being

implemented

with

Stakeholder

engagement

activities

undertaken

during Q1.

A report is yet

to be

submitted to

the Social &

Ethics

Committee in

Q1.

2. The

process of

defining

responsibilities

and providing

training and

awareness is

outstanding to

due lack of

resources in

the area. The

employee has

since retired

and not

Quarterly

30 Sep

2018


80


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


and

complaints

customer.

6. Scheduled

meetings with

key

stakeholders

7. Monthly

Stakeholder

visits which are

done

across(Farmers

, City,

8. Training of

the Emerging

Farmers

9. Agri business

Bulletin

10. Monthly

sales and

volume

reporting

presented

Internally and

stakeholders

11. Exhibitions

in collaboration

with

Stakeholders

12. Stakeholder

Forums for

Market Agents

and Mandela

Market

13. Quarterly

reports on

Stakeholder

Engagement

developed and

submitted as

part of the

performance

quarterly

reports

replaced to

date.

8

Fraud

and

Corruptio

n

Theft,

fraud and

corruption

1. Lack of /

inappropriate

segregation of

duties

2. Greed,

1. Possible

financial loss

(incl. fruitless and

wasteful

expenditure)

Critica

l

5

Lik

ely

4

Very

Hig

h

20

1. Approved

and

implemented

anti-fraud

policies and

Fair 0.50 M

od

era

te

10

5 2 CEO 1. Review of the

fraud and corruption

policy

2. Conducting fraud

risk assessment

1. Anti-Fraud

and

Corruption

Policy

recommended

Quarterly

30 Sep

2018


81


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


dishonesty,

need

(challenging

personal

financial

circumstance

s) and

opportunity

3. Lack of

definition and

understanding

of conflict of

interest

4. Inadequate

internal

control

environment,

including IT /

information

security

5. Lack of

accountability

6. Lack of by-

law

application

7. Tender

fraud and

trade

skimming

2. Possible audit

qualification

3.Damage to

reputation

4. Increased

pressure from

stakeholders

5.Potential

litigation

procedures /

Implemented

anti-fraud

hotline with

follow up /

Fraud

awareness

workshops /

Whistle blowing

processes

2. Follow up

activities of

reported fraud

(disciplinary

processes and

handing over to

SAPS)

3. Conflict of

interest

declarations

process

4.

Reconciliation

processes /

Segregation of

duties

5. Induction and

training on

policies

6. Internal audit

reviews

7.

Investigations

on alleged

cases

8. JM adopted

Systems Act

Code of

Conduct for

employees. All

new employees

sign a code of

conduct on

appointment.

3. Appointing a

service provider to

conduct the

workshop on Code of

Conduct

4. Review of the

ethics policy

5. Process in motion

to appoint service

provider to conduct

fraud and ethics

awareness and

training

6. Consequence and

accountability

management

processes

7. Enhance

Monitoring and

evaluation

processes.

by EXCO for

approval by

the ARC.

Policy will be

tabled at the

ARC Meeting

on 3 Oct 2017

2. JM has not

developed the

fraud risk

register as yet

(GRAS

conducts the

risk

assessments)


82


Ran

kin

g Departme

nt/ MOE

Objective

s

Risk

Category

Risk

Name

Causes of to

the risk

(Background

)

Consequences

Imp

act

Lik

elih

oo

d

Inh

ere

nt

Ris

k

Current

controls

Control

Effectivene

ss

Resid

ual

risk

Imp

act

Lik

e-

lih

oo

d

Risk

Owner

Actions to improve

management of the

risk

Action


9

Informatio

n and

Knowledg

e

Managem

ent

Inadequat

e

information

managem

ent

1. Lack of

integrated

information

management

processes

2. Lack of

knowledge

management

control

3. Non-

adherence to

minimum

information

security

standards

4. Lack of

adequate

document

storage

facilities /

archives

5. Lack

information

sensitivity

classification

and

associated

safeguarding

measures /

treatment

thereof

1. Loss of data

and historical

information

2. Possible non-

compliance with

legislation

resulting in

litigation, fines and

penalties

3.Lack of

supporting

information in

cases of

investigations

4. Damage to

reputation

5. Breach of

confidential

information

6.Potential

fraudulent

transactions

7.Negligent or

intentional

dissemination of

confidential

information

Maj

or 4

Likel

y 4

Hig

h

16

1. Approved IT

security policy

2. Approved IT

access policies

3. Information

back-up

procedures

(monthly testing

of successful

restoration)

4. Manual and

electronic filing

of documents

5. Physical

access controls

(biometric

scanners, 24h

security)

6. Multi-level

logical access

controls and

user access

profiles

7. Network

security

(firewalls, anti-

virus)

8. Service level

agreement with

document

management

services and off-

site storage

facilities (paper-

based

documentation)9

. Physical

document

registry in

compliance with

the archives

ACT

10. Document

management

system rolled

out to Company

Secretariat and

SCM tender

office

Fair 0.50

Mo

dera

te

8

4 2 CEO 1. Finalise the roll out

of electronic

document

management system

to the rest of the

entity.

2. Review and

consider PoPI and

PAIA requirements

with regards to access

information

3. Investigate

alternative archiving

options and build

necessary capacity to

classify information

and roll out to the rest

of the entity

4. Develop a section

14 access to

information manual

5. Appointment of the

Records Officer 6.

Develop a filling

system process

SNR

Manager IT

Long term ICT

strategy to be

developed

31 Aug

2018

ANNEXURE 6: STAKEHOLDER ENGAGEMENT STRATEGY AND PLAN

JOBURG MARKET

STAKEHOLDER ENGAGEMENT STRATEGY

Stakeholder Management Strategy

1. Rationale

The stakeholder engagement strategy outlines Joburg Market (JM)’s approach to working

with its stakeholders. Engagement forms an integral part of developing the Company

understanding of the fresh produce industry and the risks it presents to the organisation.

This will assist in shaping and delivering on the strategic objectives and priorities.

JM has a large and diverse stakeholder group and therefore recognise that it should engage

with different stakeholders for various reasons and that the Company should enable diverse

interests and individuals to contribute to the JM’s business in a constructive manner where

everyone has an opportunity to contribute meaningfully.

The Company recognises that stakeholder have different levels of influence on the its

operations and the broader industry and thus they have varying area of interest, JM’s

engagement will therefore operate at different levels where appropriate. The Company

intends to develop new relationships and recognise changing levels of stakeholder

influence in future engagement activities.

The strategy outlines the JM’s stakeholder engagement process to support the delivery of

key organisational objectives. It further explains why stakeholder management and

engagement is important for JM and thus forms an integral part of developing an

understanding of the fresh produce environment within which the JM operates.

Effective management of stakeholders is a key component for successful achievement of

organisational objectives, thus proper stakeholder management is imperative towards

gaining support for projects and anticipating resistance, conflict, or competing objectives

among the different stakeholders. Since strategy is often associated or linked to

stakeholders, it is important that when organisations formulate their strategies they should

properly consider the needs and desires of stakeholders.

The JM stakeholder management strategy will:

identify and classify stakeholders;

determine stakeholder power, interest, and influence;

Analyse the management approach and communication methodology for each

category of stakeholders.

This process will also allow for the identification of key influential stakeholders from whom

the JM can solicit input for strategic planning and gain support for various project

identification, implementation and progress. Furthermore JM should ensure that

stakeholders have every opportunity to influence strategic initiatives within Company’s

mandate and ensure that the views of various stakeholders are reflected by:

Involving key stakeholders in extensive discussion and debate around the future of

a sustainable JM;

Building and maintaining relationships and developing trust among JM’s

shareholder, staff, and three spheres of government, business partners and the

affected communities.

The premise of the strategy is that informed stakeholders will participate in improving JM’s


management approach. To achieve this, the organisation’s communication approach will

be simple, clear, easy to understand, educative, stimulating and will also promote

awareness.

2. Background

In conducting their business, the JM interacts on a daily basis with various stakeholders

ranging from government, investors, partners, customers, employees and different interest

groups.

The increasing level at which the JM is expected to participate towards economic

transformation projects in South Africa requires the Company to implement clear lines of

communication and interaction with all stakeholders to better manage their expectations.

These necessitates the process of formulating a stakeholder engagement strategy which is

aimed at ensuring that informed stakeholders actively participate in improving the

management approach of providing a world class trading facility and associated strategic

projects and deliverables.

JM’s stakeholder management process is fragmented with executives and managers

interacting independently in an unstructured manner with stakeholder representatives. The

absence of a coordinated stakeholder communication approach at corporate and divisional

level subjects JM to the following key challenges that hamper effective stakeholder

management:

Lack of a clearly defined stakeholder management process;

Absence of or lack of coordination between divisions in managing stakeholders i.e.

information sharing on interaction;

Lack of structured communication and feedback internally;

Lack of a centralized stakeholder management database to ensure accessibility to

relevant parties in the JM;

Absence of formal and systematic record keeping of interactions with stakeholders;

Absence of monitoring and evaluation process to establish the impact of the

strategic relationships to measure the value added by stakeholders.

Furthermore the King III code of corporate governance indicates that managing stakeholder

relationships is a critical area for organisations to operate effectively thus the following

principles are recommended for consideration by the JM leadership:

Recognition of the legitimate interests of stakeholders in its decisions;

Proactive management of the relationships with its stakeholders;

Identification of mechanisms / processes that promote enhanced levels of

constructive stakeholder engagement;

Building and maintaining relationships through transparent and effective

communication;

Promoting mutual respect with stakeholders;

Establishing a formal process of resolving internal and external issues;

Selecting an appropriate representative individual/team to represent alternative

dispute processes.


3. Definition of concepts

3.1 Stakeholder definition

A stakeholder is defined as “an individual or group with interest in the organisation and

its services or systems that affects or can be affected by an organisation’s actions” or

“person, group or organisation that has a direct or indirect stake in an organisation”.

The JM identifies a stakeholder as an individual or institution that would assist in

achieving the objective of augmenting or supporting the desired economic growth

impact that the Company contributes to.

Stakeholder management is the process of managing the expectation of anyone that

has an interest in the organisation or will be affected by its deliverables or outputs. It is

important to understand the values and issues that stakeholders have in order to

address them and keep everyone informed. The value derived from stakeholder

management is that it galvanises diverse entities so that all can work together in unison

and seamlessly. Without it, there is no bond and no common purpose.

There are two major elements to Stakeholder Management: Stakeholder Analysis and

Stakeholder Planning. Stakeholder Analysis is the technique used to identify the key

people who have to be won over, whilst Stakeholder Planning focuses on building the

support required for success. It is important to note that stakeholder management is

strongly linked to vision and strategy which requires analysis, planning and monitoring

to stay on track.

3.2 Stakeholder engagement

The process outlines the development of engagement principles of when to and when

not to engage with a stakeholder. There is recognition that objectives for engagement

have different levels of importance to stakeholders and that on some issues there may

not be much point in engaging with some stakeholders.

Organisations engage their stakeholders in dialogue to find out what special and

environmental issues matter most to them and about their performance in order to

improve decision-making and accountability. Engaging stakeholders is a requirement

of the Global Reporting Initiative, King III, the JSE-SRI and the new Companies Act.

Inclusive engagement of stakeholders forms some of the requirements of integrated

sustainability reporting which stipulates that business should have formal processes of

engaging stakeholders in an effort to:

align mutual interest;

reduce risk;

advance financial, social and environmental performance;

Incorporate views of the stakeholders in the compilation of reports that address

sustainable development.


There are currently no formal principles used in JM to consider whether to engage with

a stakeholder or not. The absence of formal principles creates a risk of inadequate

stakeholder management as there is no identification and prioritisation of issues which

is necessary for the success of an engagement strategy. The JM should therefore

consider engaging stakeholders when:

There is a major issue confronting the stakeholder;

There is sufficient overlap between the stakeholder’s objectives and concerns

and those of a stakeholder;

There is concern about the impact of the stakeholder’s goals or strategies;

It is necessary to improve the stakeholder’s knowledge about an issue;

There is an opportunity to help shape the stakeholder’s goals and strategies;

The stakeholder has sufficient influence over a decision;

The stakeholder needs to create more options for a planned action.

Although the JM stakeholder management team gives directive on the process of

engaging a stakeholder, it is important to note that the engagement with stakeholders

should be conducted through regular meetings and forums held at the relevant

corporate and divisional level. Other forms/mechanisms of engagement can also be

introduced.

3.2.1 Purpose of engagement

To support and communicate organisational strategy including objectives and

priorities;

To build an open relationship with JM’s identified stakeholders through transparent,

fairness, integrity and accountability;

To acknowledge that JM has different stakeholders who can affect the achievement

of strategic objectives and its sustainability;

To assess the performance through engagement with stakeholders that serves to

provide tangible performance indications, quality of outputs and eventually lead to

significant organisational improvement.

3.2.2 Strategic goal

JM’s goal is to ensure that all stakeholders have an opportunity to contribute to its

current and future business operation processes and activities so that their needs are

met in a satisfactory manner.

3.2.3 Strategic objectives

The strategy aims to achieve the following organisational objectives:

Achieving the vision of the Market of the Future (MotF);

Transformation and Black Economic Empowerment (BEE);

Food security.

3.2.4 Principle of engagement

JM engagement is informed by the following principles:


Congruence One version of the truth. We say what we mean, and mean what we say regardless of the stakeholder or communication channel.

Consultative Develop relationships where stakeholder views are considered in decision-making and we provide various channels to foster this

Collaborative To establish deep partnerships with stakeholders aligned to values and work closely with selected partners and interested stakeholders to build a more sustainable business and society.

Communicative Value open, honest and on-going communication with all stakeholders and are proactively committed to such.

Commitment Committed to working towards creating a prosperous and sustainable future for all South Africans and leveraging effective stakeholder engagement to help with the achievement of this.

Responsive Strive for continuous improvement and proactively respond to changing business conditions and stakeholder needs, interests and expectations.

4. Identification of stakeholders

It is important that all stakeholders are identified regardless of how major or minor they are.

If stakeholders are omitted there is likelihood that they may become evident at some later

stage of a business process thus posing obstacles and delays to the success of the

organisational process.

The identification of organisational stakeholders forms a very important step towards

formulating stakeholder management strategy. It is therefore very important that great care

and effort is dedicated to the process.

The following stakeholder identification process is used as a criterion to determine if an

individual will be included as a stakeholder for the organisation:

Will the person or their organization be directly or indirectly affected by the

organisation?

Does the person or their organization hold a position from which they can influence

the organisation?

Does the person have an impact on the intended project’s resources (material,

personnel, funding)?

Does the person or their organization have any special skills or capabilities the

project will require?

Does the person potentially benefit from the project or are they in a position to resist

this change?

Individuals and organisations that meet one or more of the above criteria have been

identified as stakeholders for JM.

The JM has identified its stakeholders in terms of the following categories:

Shareholder (the City of Johannesburg)

Board of Directors

Partners (Market Agents, Farmers)

Producers Associations (AFASA, AGRI-SA, NAFU, SENWES, TAU, WARD, YARD,


etc.)

Regulatory bodies (APAC, National Treasury, Auditor General, DAFF, etc.)

National Departments (Eskom, Cogta, etc.)

Provincial government/departments

Investors and finance institutions

Clients (Retailers Hawkers / vendors, Private sector, Public sector, etc.)

Municipal owned entities

Beneficiary communities

Competitors

Employees

5. Strategy process

5.1 Stakeholder analysis / classification

A stakeholder management team consisting of representatives from various divisions

in the organisation will be formed with the purpose of listing, consolidating and

analysing the JM’s stakeholders. Analysing stakeholder groups enables an

understanding of their requirements, power, interest in, and impact on the organisation

so that communication and channels of communication can be based around their

particular interests, issues and needs.

The stakeholder engagement process assesses the needs of stakeholders, defining

the areas that each stakeholder is interested in and communicating with them based

on their needs.

The stakeholders are categorised based on the level or importance to the Company

and its operations. The stakeholder analysis matrix illustrates the concerns, level of

involvement, and engagement strategy for each stakeholder.

The chart below depicts stakeholders and the level of power / interest they have on JM.

NB: Organisations with similar interest or power are grouped in order to simplify

communication and stakeholder management.

No Group Functional relation

Principal involvement

How addressed

A. Governance

1 CoJ Governance Shareholder

Sole owners of the JM

Through Cluster forums and standard reporting

2 Board of Directors

Governance of JM

Governs JM in terms of SDA

Pursue sound and effective reporting and providing strategic support

3 DED Lead Department

Sectorial link to CoJ Cooperate with Cluster structures towards integrated service delivery

B. Company

1 Staff Employees of JM

Managers and employees

Pursue a culture of professional service delivery

2 Unions Trade Unions SAMWU / IMATU Promote good communication against the backdrop of JM being a 24 hour operation

3 EPWP Job creation Extended Public Works Programme

Utilize local job seekers and prepare them with basic skills to enhance permanent employment possibilities

C. Core Business


No Group Functional relation

Principal involvement

How addressed

1 Farmers Production of produce

Supply JM from across RSA

Promote market services of JM to producers through participation in Industry events and farm visits

2 Transporters Logistics – Farm to Market

Private contractors Promote delivery compliance for an orderly delivery environment through regulation of the logistical system at JM

3 Market agents

Conducts actual selling of produce at JM

Private institutions Communicate through a dedicated forum with agency directors and their sales staff

4 Commercial Buyers

Buying of produce at JM

Distribute and process fresh produce

Communicate and support through customer services kiosks on the trading floors of JM

5 Informal sector buyer

Informal traders

Intensive distribution in various areas

Promote interaction through product handling coaching and customer care kiosks

D. Markets at JM

1 Mandela Market

Traders at JM site established through empowerment programmes

Stall markets on JM site

Communicate through a dedicated forum with the operators of trading stalls 2 Unity Market

E. Apron services at JM site

Pallet runners

Porters

“Bakkie” operators

Cooking “mamma’s”

Recyclers

Rendering of support services to traders on market for own account

Communicate with operators through the property department which includes 1-on-1 interactions

F. Tenants

Food distributors

Processors

Meat/fish traders

Soft drinks

General hospitality producers

Rendering services enabling clientele to utilise JM site as “one stop” shopping centre

Communicate with operators through the property department which includes 1-on-1 interactions

G. Financial services

Banks Servicing buyers on JM to conduct transactions

Communicate through the Finance Dept. on a daily basis to ensure real time services continuity

H. Suppliers

Multiple services rendered at JM site

Cleansing

Security

Waste disposal

Amenity gardens and land maintenance

Communicate through advertising supplier opportunities in the media and company website supplemented by briefing sessions


The power / interest matrix is used to evaluate the expectations and impact of particular

stakeholder, it further illustrates the potential impact each stakeholder may have on the project by

making assessments against the following questions:

How interested is each stakeholder group in the JM’s decisions?

What power and influence can the stakeholders exert on the organisation’s

decisions?

The chart below depicts the organisation’s stakeholders. Each letter represents a

stakeholder in accordance with the key in the chart above.

The power / interest analysis chart indicates that:

Stakeholders E, and F reside in the lower left quadrant of the matrix and therefore

require minimal stakeholder management;

Stakeholder A and G in the upper left quadrant, must be kept satisfied by ensuring

concerns and questions are addressed adequately;

Stakeholder I and J in the lower right quadrant, should be kept informed through

frequent communication on project status and progress;

Stakeholders B, C, D and H, in the upper right quadrant, are key players and must be

involved in all levels of project planning and change management. Furthermore these

stakeholders should form part of all project status meetings, reviews and ad hoc

meetings as required.

The stakeholder analysis matrix is aimed at capturing stakeholder concerns, level of

involvement, and management strategy based on the stakeholder analysis and power/interest

matrix above. The stakeholder analysis matrix will be reviewed and updated as required by

(A, G) Keep Satisfied

(E, F) Monitor

(B, C, D, E, H) Manage closely

(I, J) Keep Informed

High

Power

Interest High

Low

Low


the organisation in order to capture any new concerns or stakeholder management strategy

efforts.

This process will then lead to the formulation of a stakeholder engagement and communication

plan with specific communication methods for each stakeholder. It also determines the

appropriate levels of communication and participation each stakeholder will have on the

organisation.

Strategies of engagement

Priority provide to general channels of information

Keep involved and informed but ensure balance between concerns of high influence

stakeholders and those people actually impacted by decisions

Treat fair – honour commitments to these stakeholders in line with policy, regulations

and industry norms.

o Otherwise endeavour to keep stakeholders satisfied insofar as balance of costs and

benefits allow.

Strategic threats or opportunity – invest in engagement process to understand

concerns and develop solutions

5.2 Approach to engagement

5.2.1 Stakeholder engagement

A stakeholder engagement plan outlines the process of how JM engages with various

stakeholders in terms of issues and timeframe. The plan aims to:

support the organisation in achieving its goals and objectives;

support or improve operational effectiveness;

Support or improve relationships to ensure organisational success;

Deliver tangible results to the organisation; and

Enhance JM’s reputation.

NB: Appendix 1 gives a typical example on issues of engagement.

5.2.2 Engagement methods

Meetings

Exhibitions

Visits (inbound & outbound)

Forums

Workshops/ Symposium

Road shows

Tours

6. Stakeholder communication


Thorough effective and transparent communication programme with key stakeholders

is necessary to ensure all concerns are identified and addressed and that resources for

the project remain available.

Effective communication with stakeholders is important towards sustaining and

embedding any project initiation/implementation process. It is therefore important to

develop a communication and engagement strategy and plan to enable the JM to:

Better understand the needs and concerns of different stakeholders as they

may have different needs and concerns;

Develop a shared understanding of what it wants to achieve by communicating

and engaging with each stakeholder group;

Collaboratively develop a common set of key messages to communicate to

different stakeholders as well as a plan to use both traditional and new

communication techniques;

Provide a more coherent approach to engaging with different stakeholders.

Communication keeps stakeholders informed and hence involved in the projects and

programmes, and ensures that expectations are correctly managed. The emphasis on

communication must therefore be on interaction, dialogue and engagement with

different stakeholders.

Since effective communication is important for stakeholder relationship, JM’s

stakeholder communication framework will incorporate the following steps:

Setting communication objectives;

Setting key messages for the organisation;

Defining and prioritising key stakeholders;

Setting additional key messages which are relevant for each stakeholder group

and their particular issues/concerns;

Developing effective communication tactics for each target audience;

Allocating budget and responsibilities;

Developing a quarterly communications calendar; and

Assessing results and adapting the plan

6.1 Communication methods

Direct;

Interviews;

Print media;

Electronic media

Social media

6.2 Management of stakeholders

A good understanding of the current circumstances and which factors influence the stakeholders

is important to effective management of stakeholders. This then allows the approach to managing

stakeholders to be tailored to achieve maximum benefit. In particular, feedback channels are

crucial as this allows distinct management techniques to be utilised, depending on the feedback


being received.

The challenges faced revolve around the fact that there is currently no formal feedback system

internally that allows information and knowledge to be shared across the organisation. This results

in a lack of awareness of changes regarding a stakeholder and inability to manage expectations

adequately.

In this situation business conditions tend to change too thus compelling JM to have a reactive

stakeholder management process. The following are considered to aid pro-active management:

A review of stakeholders to be undertaken bi-annually so as to determine the following:

o If interest or influence has changed;

o If new stakeholders have become known to the organisation;

o The current level of support each stakeholder receives from the organisation’s

activities; and;

o Any significant up-coming events from the stakeholder’s business areas that impact

the organisation.

The review allows for changes in levels or methods of stakeholder management to be

addressed;

o The sponsoring or respective division will pro-actively promote the JM’s activities,

especially within its own business areas;

o Stakeholders should be managed by the individual or groups best placed to address

the stakeholders;

o Benefits and outcomes of the projects will be re-iterated to remind stakeholders of

the end goals, particularly during challenging times; and

o Managers should identify supportive personnel from their business areas to assist

with increasing colleague commitment if necessary.

7. Record keeping

This refers to a mechanism for organising information in order to make it useful and

available to stakeholders and managers and to enable external assurance of the process

is possible. Templates / tools which provide useful means of recording inputs and outputs

at key stages in the stakeholder engagement process and a database to track individual

stakeholder contact details and concerns are requirements for effective stakeholder

management.

Currently the JM does not have a centralised recording system/database that allows for

accessibility of information by interested parties to ensure awareness of existing

communications with strategic stakeholders. Hence there is insufficient shared knowledge,

coordination, understanding of stakeholder engagements and value realised from the

relationships.

Since adequate record keeping and creating a database to document all interactions with

stakeholders is critical towards addressing the outlined challenges, the stakeholder function

therefore proposes that SAP’s Rapid Deployment Solution and its Customer Relationship

Management tool to be used for recording stakeholder engagement activities in JM.


STAKEHOLDER REASONS FOR ENGAGEMENT WHY ENGAGE WITH JM FREQUENCY OF ENGAGEMENT METHODS OF ENGAGEMENT

SHAREHOLDER To provide current and future shareholders with relevant and timeous information, ensuring JM’s business is viewed in a positive light. To keep shareholders and the investment community informed at all times. To ensure image improvement, thereby minimising the potential for reputational risk. To enhance and deepen the trust placed in us and our brand.

To receive relevant timeous information on our prospects and financial and non-financial performance. To understand our financial performance. To gain insight into our strategy and management.

Formally, four times a year at the release of year-end, half- year, first- and third-quarter trading results. On an ad hoc basis as requested by the media, analysts and investors during non-closed periods.

Local and international roadshows; Ad hoc communications and answering investor and analyst questions. Annual general meeting and other investor meetings; Conferences and presentations; Media releases; AGM, reports and the corporate website. Detailed information on all published documents to ensure full disclosure of relevant information JM .regularly engages with its shareholder, the CoJ to ensure alignment of policies and methodologies, the effective capturing of synergies and leveraging of opportunities.

GOVERNMENT To build and strengthen relationships with government, both as a partner in the development of the Country. To provide input into legislative development processes that will affect the economy, activities and operations. To reaffirm commitment to public sector business development. To participate visibly in, and be a partner to, the transformation of SA and the fresh produce industry. To partner in increasing economic growth and reducing inequality and unemployment.

JM is a key role player in the economic, social and environmental transformation of the country.

Monthly or as deemed necessary by either party.

Political engagements take place where there is a business- related invitation.

BUSINESS PARTNERS AND INDUSTRY BODIES

To continue learning through interaction with the industry and cross-sectorial organisations. To leverage and build our strategic business partnerships for the maximum benefit of all our stakeholders. To use business associations as a forum through which we can promote our viewpoints on key industry issues

To deliver mutually beneficial learning. To influence and/or promote common agendas

As required or dictated by performance contracts and association or partnership membership agreements.

Quarterly meetings with our BBPs in terms of performance contracts. Monthly meetings with various industry bodies.

CUSTOMERS To understand them, their aspirations, businesses and financial service needs better. To provide appropriate advice, proactive financial solutions and value-adding services. To ensure that we maintain the high service levels they expect and deserve. To inform product development and prioritisation. To ensure accuracy of client personal and/or business information.

To receive good quality fresh produce and excellent customer service. To access world-class innovative facilities and services. To grow and promote customer outreach and product offering. Convenient access to trading facilities To enjoy protection of their assets through secure IT systems and infrastructure. To get value produce that is competitive and affordable in pricing.

Dependent on client needs and identified sales, service or guidance opportunities.

Interactions through customer services desk, relationship managers and complaint lines, client seminars, social media, surveys and marketing and advertising activities.

SUPPLIERS AND CONTRACTORS

To obtain products or services required for conducting our business. To maintain an ideal and timeous supply of goods and services for our operations. To encourage responsible practices across our supply chain BBBEE, local procurement, supplier conduct and environmental considerations. To include critical suppliers in cross-functional teams so as to contribute expertise and advice before specifications are developed for products or services.

To provide products and services. To negotiate pricing and contracts. To promote new products and service offerings. To respond to tenders. To seek input and guidance on their sustainability journeys.

Ongoing, as required. Ongoing interaction with suppliers and contractors for procurement purposes. Supplier education workshop, indabas, fairs (e.g. travel and stationery). Quarterly newsletter on sustainability matters. One-on-one negotiations and meetings.


To encourage responsible practices across our supply chain BBBEE, local procurement, supplier conduct and environmental considerations.

REGULATORS To maintain open, honest and transparent relationships and ensure compliance with all legal and regulatory requirements. To retain our various operating licenses and minimise operational risk.

To ensure regulatory compliance. To promote the soundness and stability of the domestic banking and financial system, thereby contributing to its financial stability.

Daily, weekly, quarterly and as required.

These include various forums, from trilateral meetings with the board and management including one-on-one discussions with various executive officials at prudential meetings and onsite meetings.

STAFF To ensure that JM remain an employer of choice that provides a safe, positive and inspiring working environment. To understand and respond to the needs and concerns of staff members. To provide staff with strategic direction and keep them informed about group activities.

To provide us with feedback and input that can help us improve their working environment experience as well as the performance of our business.

Ongoing and daily engagement at all levels. As required by staff.

A robust combination of face-to-face, written and broadcast communications. These included culture and engagement surveys, roadshows, emails, intranet communications, data casting, magazines and relevant training

MEDIA To leverage the reach and influence of media channels to share our business and citizenship story with stakeholders. To communicate with relevant stakeholders and the broader public with a view of having a positive influence on behaviour that will lead to desired business results. To protect and manage reputation.

To educate and inform their audiences on developments in the fresh produce industry. To be informed about JM’s contribution towards the SA economy and its products and services. To empower the audiences to make informed financial and business decisions.

Daily, in response to business-related media queries. As required in response to our various business and sustainability initiatives.

Quarterly Group Exco breakfasts to which media are invited. Updates on processes, products and services Interviews with key business media on relevant reporting dates. Daily telephone and email interaction regarding media enquiries.

COMMUNITIES To better understand them, their aspirations, businesses and financial service needs. To provide appropriate advice, proactive financial solutions and value-adding services. To create partnerships that serve to facilitate our integrated sustainability activities. To obtain input from environmental experts, communities and non-governmental organisations (NGOs) regarding key focus areas. To create awareness of our integrated sustainability commitment and initiatives.

To access the financial products and services they need. To get advice and guidance on how to achieve desired outcomes for themselves, their families, their businesses and their communities. To secure funding and partner on common social and environmental issues. To collaborate in a way that furthers social, environmental and other common agendas for the greater good.

Ongoing – as partnerships dictate or stakeholder needs require.

These include various forums, from trilateral meetings with the board and management including one-on-one discussions with various executive officials at prudential meetings and onsite meetings.