SITA ICT SMME’s Development Strategy By: Sydney Tshibubudze, Chief Procurement Officer 26 March 2015 1

SMME Development Background Agenda SMME Development Background 1 The Key Drivers of SMME’s Development 2 SITA SMME Development Approach 3 SITA SMME Development Strategy 4 SITA SMME Development Opportunities 5 SITA SMME Target/Actual Performance 6

SMME Development Background South Africa’s small-, micro- and medium-sized enterprise (SMME) economy has been actively promoted since 1995. SMMEs are a vital contributor to the health of the economy by boosting productivity, increase competition and innovation, create employment and prosperity, and revitalize communities. The New Growth Path (NGP) articulates the need to achieve a common vision to work together to achieve a goal of creating 5 million jobs by 2020. Information and Communication Technology (ICT) provides a platform for an economy to unlock new economic opportunities for growth and development.

The Key Drivers of SMME’s Development Engagement in Entrepreneurial upliftment Contribute to the sustainability of Small Local Enterprises Increasing SMME’s operational capacity & efficiency Enhancing SMME’s management capabilities Increasing SMME’s technology development capabilities Enables SMME’s financial sustainability

SITA SMME Development Approach 1 Grow SMME’s by enabling new entrants; introduce new opportunities for growth and reduce barriers to entry 2 Defend SMME’s by supporting existing SMME; locking in opportunities for growth and collaborating with market players to support current SMME’s for new projects 3 Develop SMME’s for new markets/trends by skilling for the future (e.g. e-gov services etc) and recognizing excellence

SITA SMME Development Strategy (1/2) Objective Developmental Strategy Early Payment Improve supplier financial sustainability through improved cash flow by providing early payment from invoice. Mentoring and Training Provide supplier mentoring in area such as technology and business management. Conduct tender process information sharing forum e.g. SMME Supplier Day Establishing SMME’s Help Desk to provide instant assistance. OEM Partnering Provide platform for SMME’s to partner with hardware and software OEM’s to provide support, maintenance and logistics services. Research & Technology Solution Provide platform for SMME’s to participate in research with academic institution and development of new technological solutions to address South African related socio-economic challenges in line with Government priorities.

SITA SMME Development Strategy (2/2) Objective Developmental Strategy Proactive Tender Engagement Create a database of all registered ICT SMME’s per category and proactive alert them of available tender opportunities to participate. Join-Venture Platform Develop sourcing strategies that requires large ICT entities to form Join-Ventures with SMME’s when delivery ICT implementation projects. Local Manufacturing Support Develop policy and sourcing framework that support buying of existing local brand as brand specific procurement. Foreign Player Elimination Develop policy and sourcing framework to eliminate foreign suppliers to participate in biding when there is sufficient competition by local suppliers.

SITA SMME Development Opportunities (1/2) Objective Developmental Opportunities Early Payment 7 Day payment from invoice. Mentoring and Training Supplier day for tender information sharing Technology and business management mentoring/training SMME Help Desk OEM Partnering Computer & Mobile Devices Computer Peripherals Servers & Storage Racks and Blades Research & Technology Solution E-Government Services ICT Security Technologies Mobile App Softwares

SITA SMME Development Opportunities (2/2) Objective Developmental Opportunities Proactive Tender Engagement Proactive tender notification platform. Classified SMME Database Join-Venture Platform Government Connectivity Network and Cabling installations Lan and desktop Local Manufacturing Support ? “under analysis” Foreign Player Elimination ? “under analysis”

SITA SMME Target/Actual Performance % of total SITA procurement spend through SMME’s 30% ? 20% ? 15% ? 12% ? 7% 5% 2014/15 2015/16 2016/17 2017/18 2018/19

Grow Defend Develop Thank You