STRATEGIC PLAN PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE ON TRANSPORT 14 March 2007 by ZAKES MYEZA: Chief Executive Officer

STRATEGIC PLAN

PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE ON TRANSPORT

14 March 2007

by ZAKES MYEZA: Chief Executive Officer

STRATEGIC PLAN

PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE ON TRANSPORT

14 March 2007

by ZAKES MYEZA: Chief Executive Officer

INDEX

Vision, Mission, Values and SACAA Act

Operational Environment

SACAA Profile

Purpose of Strategic Document

Situational Analysis

Set Priorities

Five (5) Strategic Objectives

Key Analysis – Current Situation

Strategy Planning Process

INDEX Cont..

Implementation of Strategy

Strategy Roll out

Financial Implications

Conclusion

VISION

REGULATORY EXCELLENCE IN AVIATION SAFETY AND SECURITY

MISSION

THE SACAA IS A PLAYER IN THE INTERNATIONAL

ARENA THAT SEEKS TO PROMOTE AND MAINTAIN A

SAFE AND SECURE CIVIL AVIATION ENVIRONMENT IN

SOUTH AFRICA, BY REGULATING AND OVERSEEING

THE FUNCTION OF THE INDUSTRY IN AN EFFICIENT,

COST EFFECTIVE, SUSTAINABLE AND CUSTOMER

FRIENDLY MANNER

SACAA VALUES

COMMITMENT

RESPONSIBILITY

ACCOUNTABILITY

CONSISTENCY

KNOWLEDGE-SHARING

INTEGRITY AND

TRANSPARENCY

The SACAA was established on 01 October 1998 under

South African Civil Aviation Act No 40 as a stand alone civil

aviation authority. Its objectives are as follows:

To control and regulate civil aviation in the Republic, and

To oversee the functioning and development of the civil

aviation industry, and, in particular, to control, regulate

and promote civil aviation safety and security.

OBJECTIVES OF SACAA

SACAA PROFILE: RACIAL COMPOSITION

71%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Black White

Employees

SACAA PROFILE Cont: GENDER COMPOSITION

54%

46%

42%

44%

46%

48%

50%

52%

54%

Male Female

Gender

PURPOSE OF STRATEGIC DOCUMENT

The purpose of the strategic document is to:

Define the process involved in strategy formulation

Document the short-term strategy for ICAO readiness by June 2007

Document other short to medium term strategies by prioritising outcomes, and stratifying them in the expected years

Use the document for performance agreements with stake holders

Use the document for divisional score cards and in turn individual scorecards that are linked to the

Performance Management System.

SITUATIONAL ANALYSIS – SACAA LEGACY

The CEO appointed March 2006 conducted a situational analysis/

review of SACAA’s business environment. The findings identified

the organisation as a dysfunctional one and was manifested by

the following:

Conflict of interest, e.g. Execs and Senior Managers are

also Union members

Incoherent and misaligned structure leading to

structural conflicts and process disconnects.

Culture of non-performance.

Low employee morale and no confidence in top

management.

Poor systems and processes

Poor industry view of organization's competence.

SITUATIONAL ANALYSIS - SACAA LEGACY Cont..

Negative findings in 1999 audit and 2001 follow-up by the

International Civil Aviation Organization (ICAO).

Many of these findings were not corrected in the six (6)

years since the audit

This was reconfirmed by United States Federal Aviation

Authority technical review conducted in June 2006.

In September 2006 an immediate survival strategy was

developed and continues to be in place focusing mainly

on strategic objective one.

(Emphasis will be on human resource requirements, strategic

objective 5, as this is the ultimate risk in ICAO compliance)

SET PRIORITIES

Following the remedial actions submitted to, and approved by

the Board in 2006, the following actions were prioritised.

1. To pass the July 2007 ICAO audit

2. Build technical and managerial staff and skills levels

3. Implement the performance management system and set

meaningful targets

(The Board formulated five (5) strategic objectives to

address short-term and long-term strategic goals)

STRATEGIC OBJECTIVES

Below is a summary of five objectives of the SACAA that were

approved by the Board

1. Set civil aviation safety and security standards and regulate industry compliance in accordance with International Civil Aviation Organisation (ICAO) standards and global best practices.

2. Facilitate aviation industry functioning, development and growth by participating in joint fora, making safety and security recommendations and promoting safety and security through campaigns and information dissemination

3. Build effective organization systems and processes in order to ensure financial stability, good corporate governance and performance excellence that meet or exceed stakeholder expectations.

STRATEGIC OBJECTIVES Cont..

4. Ensure growing customer satisfaction by creating a knowledge-based and customer-focused organization

5. Attract, develop and retain skilled human capital.

KEY ANALYSIS

Having gone through the background of the organisation, it is

important to note the current situation of the SACAA by taking

you through the findings of a recent Strengths, Weaknesses,

Opportunities, and Threats (SWOT) analysis.

KEY ANALYSIS - STRENGTHS

The following were strengths identified in the SWOT analysis

The SACAA was recognised as an international player

of note in Africa.

A Chief Executive Officer had been appointed by the

Board and given a mandate and resources to turn the

organisation around

Department of Transport (DoT) support for positive

change.

ISO accredited status.

Some committed staff members needing leadership and

motivation.

KEY ANALYSIS - WEAKNESS

The following are weaknesses identified in the SWOT

analysis

Unresolved negative audit findings identified in the

ICAO Audit in 1999 and 2001.

Insufficient technical skills

Top management skills gap

Poor systems of control

Lack of customer focus

Lack of some key staff

Lack of SACAA’s credibility in the industry.

KEY ANALYSIS: OPPORTUNITIES

The following opportunities were identified in the SWOT analysis

International respect and recognition. (ICAO compliance

is a global status for SACAA).

Status as Africa’s gateway, with significant economic

spin-offs for South Africa.

Remarkable influence on the development of policies

and standards affecting the civil aviation industry in

SADC and Africa in general.

Becoming a benchmark for efficiency in the regulation of

civil aviation.

KEY ANALYSIS - THREATS

The following threats were identified in the SWOT analysis

Failure to pass the ICAO audit could lead to dire

consequences.

Failure to pass the International Aviation Safety

Assessment (IASA) audit

Industrial unrest due to the implementation of a

Performance Management System (change resistance)

Negative influences on some staff by previous

management to prevent exposure of past

mismanagement.

Loss of existing critical skills

STRATEGY PLANNING PROCESS- CONTENTThe following strategic section is made up of the sub-topics

tabulated below.

Strategy development and roll out process

Strategy objectives and implementation

Conclusion

STRATEGY PLANNING PROCESS – CONTENT Cont…

The following are two major divisions of the strategy development

process:

Strategy Development Process

The first slide will tabulate the meticulous strategy

development process demonstrating the all inclusive

approach.

Strategy Roll Out

The Second slide tabulates the roll out of the strategy

i.e the implementation or use of the strategy. In this case the

end result is the completion of employee scorecards laying

a good foundation for performance management.

A good strategy not implemented, is of no use.

STRATEGIC PLANNING PROCESS

DOT PerformanceAgreement

Board Strategic Objectives

Identified Core

Business

ICAO Critical

Elements

KeyAccountability

Matrix

Management StrategicPlanning

Workshop

Developmentof Strategic Framework

Board Strategic Planning Workshop

Development of SACAA

Strategic Plan

SACAA Strategic

Plan Roll-out

STRATEGY ROLL-OUT MAP

SACAA Strategic Plan

SACAA Organisational

Scorecard

DOT Performance Agreement

Divisional Scorecards

All Staff Performance Scorecards

STRATEGIC OBJECTIVES

AND IMPLEMENTATION

STRATEGIC OBJECTIVES & IMPLEMENTATION

The following slides will address implementation on the five

strategic objectives by categorising them under the following:

Outcomes per year of focus

The desired outcomes are listed per strategic objective with the percentage of focus in each year.

Critical Success Factors

Critical success factors to enable outcomes are noted under each strategic objective.

Action Plan

Action plans to achieve the stated outcomes are tabulated under each strategic objective

STRATEGIC OBJECTIVES & IMPLEMENTATION

Instrument of Control

Each strategic objective has tools to view or ensure progress

on the stated outcomes.

The following three instruments of control will be used on the

five strategic objectives accordingly:

Project Plans

Performance Scorecards

Executive Management Feedback

STRATEGIC OBJECTIVE 1

Set civil aviation safety and security standards and regulate

Industry compliance in accordance with International Civil

Aviation Organisation (ICAO) standards and global best

practices.

OBJECTIVE 1 - OUTCOMES

OUTCOMES Yr 1 Yr 2 Yr 3

Understandable and comprehensive legislation to effectively oversee the industry and meet requirements of (ICAO)

90% 10%

Civil Aviation Regulations and Technical standards to be fully implemented and updated simultaneously with ICAO pronouncements.

100%

Meet oversight requirements by implementing a functional organisational structure that will provide effective oversight and the resolution of findings and perform in depth audits.

100%

Technical personnel appropriately trained to maintain and enhance their competence at the desired level.

90% 10%

A comprehensive technical library that is easily accessible and is consistent with best practice.

70% 20% 10%

Civil Aviation Regulations (CAR's) and Civil Aviation Technical Standards (CATS) personnel are all appropriately licensed and all licences and certificates are issued in time in a computerised environment.

100%

Proactive system to proactively perform audits and inspections in accordance with CAR’s, CATS & ICAO requirements resulting in a reduction of accidents/incidents/occurrences

70% 20% 10%

Enhanced safety levels that facilitate a paradigm shift in industry mentality to voluntary compliance rather than punitive.

60% 20% 20%

OBJECTIVE 1 – CSF


The following are critical success factors in meeting the above

objective and realising the desired outcomes:

Enforcement capability through adequate and trained staff

Timeous promulgation of Acts

Thorough consultation with industry during the Act amendment

Effective administrative processes and systems to be put in place

OBJECTIVE 1 – ACTION PLAN

Action Plan

The following action plans will ensure the achievement of the

stated objective.

Establish electronic links with ICAO to obtain alerts to the Standards and Recommended Practices

(SARPS)

Facilitate the combination of the CEO and Commissioner for Civil Aviation (CCA) positions into one

Redesign the organisational structure to support effective oversight and resolution findings

Develop and implement a comprehensive skills plan programme.

Establish a comprehensive technical library

Develop an integrated surveillance system


Facilitate aviation industry functioning, development and

growth by participating in joint fora, making safety and

security recommendations and promoting safety and

security through campaigns and information dissemination.


:


A developed industry with more aviation institutions whilst improving safety and security infrastructure.

20% 50% 30%

More HDI’s in technical positions 80% 10% 10%

BEE partnerships established and the aviation charter implemented.

100%

Increased industry and public awareness in matters of safety and strategic partners identified.

100%

Increased support of the DOT programs. 100%

Increased involvement in SADC and African and Indian Ocean Islands aviation development.

15% 75% 10%

OBJECTIVE 2 – CSF


The following are critical success factors in meeting the objective

and realising the desired outcomes:

A regional and global focus to facilitate/support growth of

local aviation industry.

Clear guidance, complete & practical regulations, and

faster legislative processes.

Use of experts to ensure rule-making implications are

fully recognised.

Accurate statistics and accessibility to information.

OBJECTIVE 2 – CSF Cont..

Industry liaison, workshops and awareness

Support from tertiary institutions.

DOT plans and programmes communicated in advance for

proper resource allocation and time for planning purposes.

Harmonisation of regulations and systems through SADC

Promotion of BEE Partnerships.


Action Plan


Stated objective.

Establishment of detailed operator guidelines

Develop a comprehensive talent management plan that addresses HDI requirements.

Establish policies and procedures to promote BEE partnerships

Develop a communication and awareness programme that includes institutions of higher learning.

Include the attendance of DOT as a generic KPA on the performance scorecard.

Institute exchange programmes with SADC and other international aviation authorities.


Build effective organization systems and processes in order

to ensure financial stability, good corporate governance and

performance excellence that meet or exceed stakeholder

expectations.

OBJECTIVE 3 - OUTCOMESOUTCOMES Yr 1 Yr 2 Yr 3

Best practice in corporate governance in use. 100%

A comprehensive risk management plan in use. 100%

An accessible and secure information management system with reduced reliance on a manual record system with the aim of moving to a paperless system.

100%

An integrated decision support system that enables access of key information and global statistics by management as well as support system for effective decision making.

80% 20%

A sustainable income stream commensurate with the challenges of ICAO, improved financial control and adherence to the PFMA.

100%

Improved organizational performance and a flexible organisation structure to achieve strategic goals.

90% 10%

ISO compliance. 100%

OBJECTIVE 3 – CSF


The following are critical success factors in meeting the objective


Initiate project to move to a paperless environment.

Improvement of budgetary controls.

A solid project plan to improve systems and processes.


Action Plan


stated objective:

Development and implementation of an accessible and

secure information management system that will

lead to reduced reliance on a manual record system.

Implement software for statistical input analysis

Obtain approval from DOT and cabinet for the increase

of rates of various income streams.

OBJECTIVE 3 – ACTION PLAN Cont..

Implement the performance management system

Distribute PFMA to management and obtain acknowledgement

of receipt.

Develop and implement an enterprise wide risk management

plan.

Conduct ISO audits to ensure compliance.


Ensure growing customer satisfaction by creating a

knowledge based and customer focused organization



The use of a secure, comprehensive, accurate and relevant information system providing industry knowledge base, allowing online access to customers.

50% 50%

Improved and standardized inspector skills and guidance material contributing to improved service levels and guidance to the industry.

70% 30%

Adherence to the customer service charter 100%

An effective customer communication strategy implemented. 100%

Primary source / hub of industry information and knowledge resource

30% 70%

OBJECTIVE 4 – CSF


The following are critical success factors in meeting the above

objective and realising the desired outcomes:

Customer oriented culture developed.

Fully developed guidance material.


Action Plan


stated objective.

Establish an online industry information hub

Enhance and standardise inspectors guidance material

Conduct customer surveys and service audits

Implementation of an effective customer communication

strategy


Attract, develop and retain skilled human capital.

OBJECTIVE 5 - OUTCOMESOUTCOMES Yr 1 Yr 2 Yr 3

A cost effective tool providing accurate, reliable employee information to the Company to facilitate timeous, strategic business decisions

45% 45% 10%

An overarching HR Strategy which is aligned to the overall business strategy and strategic business objectives

70% 30%

A transformed organization that embraces diverse individual capabilities and affords equal opportunities for meaningful participation.

50% 40% 10%

An HR business approach that will deliver value adding strategic partnerships and HR best practices.

100%

Aligned and standardized HR processes, policies, practices and procedures.

80% 20%

Management of Human Capital through integrated and aligned HR process (that forms part of employee life cycle) to meet future business needs

45% 45% 10%

Efficient day-to-day processing of transactions and delivery within the HR Department

50% 50%

Sound cooperative relationships between the leadership and employees established and maintained.

70% 30%

OBJECTIVE 5 – CSF


The following are critical success factors in meeting the

objective


HR credibility within the business:

Developed policy and procedural frameworks

HR record systems developed

Informed and skilled HR staff

Talent management system implemented

Formulation of partnership structures and their function

working agreed upon between employee

representatives and the leadership


Action Plan


stated objective.

Audit the Human Resources Systems and processes:

Implement a Human Resources Information

Management System

Development of an effective Human Resources

Strategy

Facilitate organisational transformation and change

management policy

OBJECTIVE 5 – ACTION PLAN Cont..

Facilitate organisational transformation and a change

management policy

Establish procedures and policies to facilitate a Human

Resources Business Partner mindset

Establish a HR Governance Framework through Policies and

Procedures

Institute control mechanisms to ensure effective transactional

delivery

Perform employee / position cross matching.

STRATEGY ROLL - OUT

The completion of the strategic document mean the following

actions will be taken:

DOT performance agreement can now be finalised

SA CAA Organisational Scorecard based on expected

outcomes may be completed (Key Accountability

Matrix of the organisation already completed)

Divisional scorecards based on the accountability matrix can

be completed.

All staff performance scorecards based on their divisional

ones can be completed.

FINANCIAL IMPLICATIONS

The pending International Civil Aviation Organisation (ICAO)

audit in July 2007 resulted in the following:

A review of the organisation done in 2006 highlighted long

outstanding unresolved findings that address the 8 ICAO

critical elements.

Class A1 project being implemented after Board approval in

September 2006 to ensure a clean audit by ICAO.

R56m budget approved for the Class A1 Project that takes

place in the 2006/ 7 and 2007/ 8 financial years.

FINANCIAL IMPLICATIONS CLASS A1 PROJECT

The Class A1 project funds were to be used for addressing the

legacy of the dysfunctional SA CAA by:

Training of existing technical personnel to bring them to an

acceptable level of competence.

Recruitment of locals and expatriate technical skills in order to be compliant by set date.

Procuring assistance from the ICAO to ensure readiness for June 2007 audit.

Improving of processes and systems in order to implement best practice.

Sub-contracting critical elements in the project plan in order to ensure delivery by set date.

Class A1 project being implemented after Board approval in September 2006 to ensure a clean audit by ICAO.

R56m budget approved for the Class A1 Project that takes place in the 2006/7 and 2007/8 Financial years

FINANCIAL IMPLICATIONSCLASS A1 PROJECT

The following 2007/ 8 figures are inclusive of the A1 project.

RRevenue 197,812,355

Expenses 243,064,658

Deficit (45,252,303)

Capital Expenditure 16,557,000

(There is cash available to finance the deficit)

FINANCIAL IMPACT – 2007/ 8

The Class A1 project causes the following deficits:

1. In 2006/ 7 a R1,5m surplus was budgeted, however, a

revised budget/forecast shows a deficit of R11,5m as a

result of the A1 Project spreading over two financial years.

2. In 2007/ 8 a deficit of R45,2m is budgeted otherwise this

would have been a break even budget.

It should be noted that the the R45,2m deficit is an accounting

deficit as there are cash reserves to finance the above amount.

Therefore this is not a request for funding.

FINANCIAL IMPACT – 2007/ 8

In line with corporate governance the following processes will

follow in order to approve the budget deficit for 2007/8.

1. An exemption has been applied for in terms of section 53

(3) of the Public Finance Management Act that states that

public institutions can not budget for a loss unless prior

approval is granted by National Treasury.

2. The SACAA Board approval has been put in motion and the

date of the deliberation on the above matter is set for the

15th of March 2007.

CORPORATE GOVERNANCE

Finally, the SA CAA demonstrated inclusivity, transparency, and

analytical prowess in its development of this strategy. The

SA CAA believes that its business strategy is not only relevant

to the challenges facing the organisation but also progressive

and in line with the aims and objectives of the new South Africa.

The portfolio committee is accordingly requested to take note of,

and endorse the SA CAA’s Strategic Plan for the period 2007 to

2010.

CONCLUSION

THANK YOU!!

Documents

STRATEGIC PLAN PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE ON TRANSPORT 14 March 2007 by ZAKES MYEZA: Chief Executive Officer