1. Click to edit Master subtitle style SITA Report to the Portfolio Committee on Public Service and Administration 1 September 2010

2. Scope  Introduction  Inception of SITA, Review and Rationale for a Turnaround  MPSA Performance Outcomes  Contribution to Government priorities  SITA Mandate and Services  Achievements and Challenges  Achievements since inception  Challenges – the need for a Turnaround  Procurement System (Contract Management)  SITA Strategic Direction  Strategic Plan 2010-2013  Strategic outcomes  Progress to date 22

3. Inception of SITA  SITA was established in April 1999  By SITA Act 88 of 1998 as amended by Act 38 of 2002  Registered as Schedule 3A Public Entity (according to PFMA)  By amalgamation of  InfoPlan (Pty) Ltd, the ICT Service Provider to Dept of Defence  Central Computer Services of the Department of State Expenditure  Sub-component Information Systems within the Department of Safety and Security 33

4. SITA Review  In March 2010 Cabinet adopted a Turnaround Framework for SITA, recognising that a decade after the formation the lead ICT agency of government, SITA was in crisis.  Review teams (established by MPSA) identified a number of issues that prevent SITA from achieving the objectives as identified by the Presidential Review Commission (PRC) in 1996:  Be the lead agency for ICT in the public service  Procure Information and Communication Technology (ICT) goods and services, using economies of scale to reduce the cost of ICT;  Develop standards, architectures and strategies to enable systems to exchange information (interoperability);  Enhance government productivity through the use of ICT, and  Focus government ICT provision towards the betterment of citizen- centric services.  Coordinate the whole-of-government ICT initiatives. 44

5. Rationale of Turnaround strategy  Strategy must  Address internal issues that prevent SITA from fulfilling its mandate.  Address concerns from customers (departments, provinces), suppliers, public institutions and the sector around quality of service, pricing, corruption and other inefficiencies.  Speak to the priorities of government and the DPSA during the 2009-2014 term.  Finally, position SITA to play its role in the development of the South African ICT sector. 55

6. MPSA Outcomes  OUTCOME 12: An efficient, effective and development oriented public service and empowered, fair and inclusive citizenship:  Output 1: Access to and quality of Service.  Output 3: Business processes, systems (PERSAL functionality and accuracy)  Output 3: SITA Efficiency and Effectiveness  Output 3: Improvement in Supply Chain Management  Output 4: Improvement in the corruption perception index. 66

7. SITA Contribution to Government priorities  An effective public sector ICT agency, which provides ICT goods and services to government that impact on productivity, the lowering of costs and citizen convenience.  Modernisation of public service operations by development and implementation of Integrated Financial Management System (IFMS).  Citizen convenience, assist and support the roll-out and connectivity of the multi-purpose Thusong centres, contribution to the development of government-to-citizen e-government solutions in general.  Security and convergence of government ICT, through the improvement of information system security measures to support the Government’s anti- corruption campaign (i.e. the security measures of existing PERSAL, BAS and LOGIS), and strengthening Regulatory function (ICT Standards and Certification).  Government ICT programmes, by supporting and active involvement in the development of key ICT programmes in government, Education (LURITS), Health eHR, Justice (IJS), Social Development (NISIS). 77

8. SITA Mandate  The mandate of SITA as spelled out in the Act is: a) to improve service delivery to the public through the provision of information technology, information systems and related services in a maintained information systems security environment to departments and public bodies; and b) to promote the efficiency of departments and public bodies through the use of information technology 88

9. Mandatory Services 99 Data Processing ( Act, Sec 7(1)(a)(iii)) Private Telecoms Network (Act, Sec 7(1)(a)(i)) Transversal Systems (Act, Sec 7(1)(a)(ii)) Procurement (Act, Sec 7(3)) Disaster Recovery Plan (Regulation, Sec 4.1.2) Information System Security (Act, Sec 6(a)) IS Convergence Strategy (Regulation, Sec 4.1.1 (a)) Information System Inventory (Regulation, Sec 4.6) Research Plan (Regulation, Sec 4.4.1) Standards (Interoperability & Security) (Act, Sec 7(6)(a)(i),(ii)) Certify against Standards (Act, Sec 7(6)(b)) Act means “SITA Act 38 of 2002”; Regulation means “SITA General Regulations R.902 of 2005”.

10. SITA Service Portfolio 1010

11. SITA Achievements (Part 1)  Full Outsourcing (ICT Infrastructure Service)  DOD, SAPS and KZN fully outsourced to SITA as “one-stop” service.  National Network Infrastructure, that enable integration among government departments.  Government’s Transversal Systems operate like clockwork (transactions are processed on time and salaries paid on time).  System Integration and Solution Development service  Ongoing development of Integrated Finance Management System (IFMS), to improve resource management and decision-making in Government.  Learner Unit Registration information tracking system (LURITS), to improve Basic Education.  Poverty Index System, City of Johannesburg to support “war on poverty”.  Telemedicine, to bring Health Care into rural communities. 1111

12. SITA Achievements (Part 2)  Value Add service  Minimum Interoperability Standards (2007) to improve interoperability  Government Wide Enterprise Architecture, to improve ICT Planning  KZN Nerve Centre, to improve provincial service delivery  Municipal Blueprint, to standardise ICT for local authorities  Support & Transaction services  Call Centres (Batho Pele Gateway, Independent Electoral Commission, Presidential Hotline, South African Social Security Agency)  GovTech Conference, as platform to grow ICT development in the country  Internal  Achieved ISO9001 Quality certification (organisation wide)  Developed Service Portfolio, capability model and a costing and pricing model. 1212

13. Challenges (Part 1)  Symptomatic and Salient issues  Services Delivery: Poor service delivery (from proposals, through to service delivery and service level management; inconsistent service delivery and absence of services at some service outlets)  Service Value: Perception of services being expensive and non-value adding  Procurement: Poor quality of service, lack of compliance with regulations, pricing and turn-around times, no economies of scale, weak internal capabilities, processes and performance monitoring.  Customer base: Failure to complete the incorporation of government departments into SITA due to the dissatisfaction with SITA service levels and standards.  Personnel: High staff turnover especially at leadership level, core skills, ineffective board and weak corporate governance; 1313

14. Challenges (Part 2)  Systemic and Institutional issues  Unable to achieve the values of the ICT House of Value (poor enforcement of interoperability and economies of scale).  Ineffective “Regulatory” role with poor certification, no Government- wide ICT inventory and little integration of Government systems to reduce duplications;  Enterprise [software] agreements with Suppliers proved unworkable at times and even costly when compared with the market.  Non-adherence by government departments to the SITA Act  Internal performance  Poor compliance and performance culture;  Bloated functions and structures.  Unsigned Business agreements and service level agreements.  Ineffective contract management system 1414

15. Procurement system (Contract Management)  Tender Management  Governed by SITA Procurement Policy (SOPP)  Makes provision tender invitation  Tender evaluation  Tender adjudication  Each of the above supported by relevant governing structures  Contract Management  Contracting with successful bidder  Supplier relationship management  Contract administration (Achilles Heel)  Monitor supplier compliance to terms and conditions  Monitor delivery according to Service Level Agreement / Statement of Work.  Contract term management. 1515

16. 1616 SITA Strategic Direction

17. Vision & Mission Vision “Be the lead ICT agency to enable public sector service delivery.” Mission "To render an efficient and value added ICT service to the public sector in a secure, cost- effective and integrated manner, contributing to service delivery and citizen convenience." 1717

18. 1818 ICT House of Value* * SITA Regulations & SITA Act (amended) Impact on Government Services Unique ICT Value Contribution Means/Services ICT Planning  ICT Integration  ICT Operations Securi ty Interoperab ility Reduced Duplication Economies of Scale Digital Inclusion Lower Cost Citizen Convenience Increased Productivity

19. SITA Role as Value contributor 1919 To effectively fulfil this role, requires a highly sophisticated and dynamic agency with the necessary leadership, skills, capabilities and systems and processes to ensure a high level of service excellence, value for money, innovation and thought leadership

20. Turnaround Focus Areas  Services: Capabilities that produce or render ICT related goods and services to an organ of state at a price (revenue generating);  Procurement (Supply Chain Management): Capabilities that procure ICT goods and services from the ICT Industry (suppliers) for and on behalf of an organ of state.  Regulatory role: Capabilities that fulfil the role of ICT Regulator (including set standards for interoperability and security, certification, R & D, Inventory of Government Information Systems, Information Systems convergence strategy).  Stakeholder, image, reputation: Capabilities that manage customer needs and expectations, foster good relationships and promote the brand and image of SITA.  Governance: Bodies and structures that collectively provide strategic direction, policy and ethics of SITA, and ensure performance and conformance thereto. 2020

21. Key Drivers  ICT Leadership, which is the ability to fulfil the role as lead agency on ICT in government, to become a trusted advisor to customers and stakeholders and be the knowledge hub on government ICT matters.  Service Delivery, which is the scope, relevance and quality of services SITA offer, in order to provide effective and efficient products and services to customers.  Value Proposition, which is the unique value that SITA adds to its service offering to the public sector as defined in the Government ICT House of Value, in order to achieve unique, relevant and high quality service offering.  Demand and Supply, which is the ability to predict and respond to the demand and supply indicators, in order to achieve improved response times, knowledge/awareness and planning capabilities.  Pricing & Sustainability, which is how SITA manages the cost of its services and products, determines the price of services, in order to achieve fair pricing that matches the value-add and improve financial sustainability of the organisation. 2121

22. 2222 SITA Strategic Plan 2010-2013

23. Strategic Outcomes 2010/11 – 2013/14 2323 NoStrategic OutcomeKey Performance Areas 1Proficient lead agency in public sector ICT Stakeholder relationship management Service Portfolio Management Innovative and Learning organisation 2Effective and integrated public sector ICT Supply Chain Management (SCM) Financial viability and sustainability Economies of scale SCM Processes, systems and integrity SCM Performance Management SCM Contract management 3Competitive pricing and financial sustainability Financial viability and sustainability Pricing and costing, value for money Financial systems, processes, people & technology 4Effective ICT Regulator Financial viability and sustainability Regulatory role (standards, certification, convergence) 5Effective Governance and Monitoring Customer and supplier monitoring and compliance Internal Governance, Monitoring & Compliance 6Employer of choice Organisation Architecture Building high performance organisation with a strong performance and compliance culture Human Resource and Capacity Leadership Excellence

24. Outcome 1: ICT Lead Agency 2424 Strategic outcome 1: Proficient lead agency in public sector ICT Key Performance Areas and OutputsInitiatives/Activities Stakeholder Relationship Management, measured by:  Stakeholder Satisfaction Index (SSI)  Customer Satisfaction Index (CSI)  Commission SSI study to establish baseline.  Cultivate and Improve Stakeholder relationships  Reposition SITA as a Thought Leader in ICT.  Commission CSI study to establish baseline for critical service areas.  Implement and Monitor Service Improvement programme for identified services.  Implement and Monitor SCM Service improvement programme Service Portfolio Management, measured by:  Performance against contracted service levels for Hosting Services, Networks, Internet Services, and other Services  Systems Integration Capability  Implement and Monitor Service Portfolio Strategy  Manage Service Levels  Implement and Monitor Service Improvement Programme  Develop and implement Prime Systems Integration (PSI) Capability. Innovative and Learning organisation, measure by:  Knowledge Management Maturity level  Develop, Approve and implement knowledge management strategy

25. Outcome 2: Supply Chain Management Strategic Outcome 2: Effective and integrated public sector ICT supply chain management Key Performance Areas and OutputsInitiatives/Activities Financial viability and sustainability, measured by:  Financial viability of SCM Function  Development and implementation of SCM function as a revenue stream  Cost Recovery Management Economies of scale (SCM), measured,  Cost saving on Hardware, Software Licenses and Services purchase.  Develop and implement Software Licence Management strategy.  Establish Government Hardware, Software and Service Baseline. SCM processes, systems and integrity as measured by:  SCM Capability Maturity  Conduct SCM Capability Maturity assessment  Redefine the procurement value proposition (services and value- add).  Integrate Supply Chain Management processes with business development.  Develop and implement Customer Requirements management capabilities (demand management) SCM Quality Management, measure by:  SCM Service Quality Performance Index  Establish a SCM performance Index.  Implement and Monitor improvement initiatives SCM Contract Management, measured by:  Compliance with Contract Management Practice  Review, Improve and Implement Supplier contract management capability according to good practice.  Manage Supplier Service Level Agreements.  Develop and implement product life-cycle management practice (to monitor contract life-span) 2525

26. Outcome 3: Pricing and Sustainability 2626 Strategic Outcome 3: Competitive pricing and financial sustainability Key Performance Areas and OutputsInitiatives/Activities Financial viability and sustainability, measured by:  Liquidity Ratio  Solvency ratio  Profitability  Return on Investments (ROI)  Debtor Days  Effective cash management  Review credit management policy (including how to manage bad/outstanding debt)  Optimise working capital by optimising cash flow, minimise debt exposure and pay creditors on time  Revenue Growth  Reduce and manage costs  Manage Profitability across service offerings.  Develop ROI strategy and plan.  Manage and Monitor return on investments Pricing and costing, measured by:  Standardised Costing and pricing Methodology across service portfolio  Review, benchmark and Implement a standardised Costing and Pricing strategy and capability. Financial systems, processes, people & technology, measured by:  Integrated Financial Systems Implemented.  Acquire and implement Business Intelligence (BI) and reporting tool.  Acquire & implement Budgeting system.

27. Outcome 4: ICT Regulator 2727 Strategic Outcome 4: Effective ICT Regulator Key Performance Areas and OutputsInitiatives/Activities Financial viability and sustainability, measured by:  Financial viability of Regulatory Function  Develop and approve Business Plan for Regulatory function.  Approve and implement Cost Recovery Management Regulatory Role, measure by:  Fulfilment of Regulatory Role  Level of compliance with Standards  Develop Government Information System Convergence Strategy  Establish and maintain Information System Inventory  Review and Update standards for information system security and interoperability.  Develop Research and Development strategy, plans, investment and capabilities  Develop Government Wide Enterprise Architecture  Certify compliance of ICT against interoperability standards  Certify compliance of ICT against information system security standards

28. Outcome 5: Governance 2828 Strategic Outcome 5: Effective Governance and Monitoring Key Performance Areas and OutputsInitiatives/Activities Customer and supplier monitoring and compliance, measured by:  Validity and Relevance of Service Level Agreements (SLA)  Audit and Monitor all service level agreements.  Engage key stakeholders to support enforcement of service delivery contract management.  Standardise Service Level Agreements and commission Legal opinion on validity thereof. Internal Governance, Monitoring, Compliance and accountability, measure by:  Level of Compliance and audit findings to Governance Risk and Controls.  Compliance Level (Accountability)  Develop and implement Governance Compliance and Risk Framework (M&E)  Monitor and ensure compliance with Governance framework (including clean audit report, delegation of authority).  Monitor/ensure compliance with Corporate Policies/Process  Implement consequence (disciplinary) measures

29. Outcome 6: Employer of choice 2929 Strategic outcome 6: Employer of choice Key performance areas and OutputsInitiatives Organisation Architecture, measured by:  Alignment of Organisation Architecture with aligned to value proposition (service offering)  Review the business model and operating model (organisational architecture), including value proposition, service offering, key business processes, core competencies, structure and technologies. Human Resource and Capacity, measured  Organisational Capacity Alignment  Employment Equity  Employer of Choice Strategy  Organisational core competence  Workforce competence alignment  SITA’s integrated and standardised management reporting cycle.  Leadership behavioural charter  Approve and Implement Human Resource Development strategy  Monitoring Progress against HR plans.  Implement EE Plan per Division  Develop and implement employer of choice strategy  Organisational competence workforce placement strategy  Risk management strategy pertaining to Floating Workforce  Development and implementation of the Integrated standardized management approach  Enforcement of monitoring and evaluation of leadership and management accountability matrix  Development and implementation of a leadership behaviour charter Building high performance organisation with high performance culture, measured by:  Definition and execution of indicators for HPO & HPC  Development and adoption of service delivery charter and policies  Change management programme for high performing organisation  Development and implementation of the integrated performance management policy and procedure  Development and instilling of culture of work, accountability and service delivery by all employees (Individual Performance Contracts and Operational Level agreements)

30. Progress to date  Board of Directors reconstituted in March 2010  Strong oversight responsibilities by Board sub-committees.  Acting CEO appointed.  Turnaround implementation  Doing things differently  Three-year strategy, outcomes for each year  Work started in each of the strategy priority areas  Ongoing engagement with stakeholders as we proceed  Shareholder approval of Turnaround Strategy 3030

31. Click to edit Master subtitle style Thank You Dankie Siyabonga Ke a leboha Siyathokoza 3131