This blog contains the popular commentary "An Engineer's View" which is a regular feature of SA Mechanical Engineer. The commentary reflects the personal views of SAIMechE members, typically those who have accepted leadership positions in the Institution.
If you are a SAIMechE member and would like to share something valuable with your community, please send your submission to info@saimeche.org.za for consideration.
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Posted By Chris Reay,
Monday, 15 December 2014
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It has often been raised that we should limit the supply of Engineers to the market in order to increase the remuneration levels through normal supply/demand dynamics. The ensuing debate tends to indicate that employers would then employ unqualified or untrained persons with the resultant risk of the failure of the system through poor design, operation and maintenance.
The answer must therefore lie in addressing both limitations and to converge towards a combination of necessity and sufficiency and meeting a standard of safety and reliability which effectively means a level that is decreed by adherence to the laws of science. That is a pretty good advantage we have in our profession.
SA is essentially set up for this structure via internationally accredited tertiary qualifications, a well-defined candidate training model with professionally focused assessment criteria, which will shortly be joined by the requirements of Identification of Engineering Work (IDoEW). As with any great rules and structures, they are only any use if implemented effectively by the parties concerned.
Can there be any doubt that Engineers would want to maximize the return on time and effort? As the income levels rise, more Engineers will enter the profession. But engineering, of all the professions, is probably the one most readily open to the "quacks" of the discipline, employing guess work, non-adherence to standards, quick fixes and obfuscations which can delude the public. Examples are rife.
Then there is the take-over of roles that should be performed by the Engineer by bean counters and politicians and the like in matters of selection of cost effectiveness on maintenance, for one example.
This prostitution of Engineering can therefore only be contained by regulation. Thus, as we proceed from the well regulated tertiary starting point, we recognize the need for competence standards and assessment criteria for registration, followed by IDoEW in the realm of practice.
The demand then for the numbers of Engineers required will follow from the needs of society. The constant refrain on scarcity of skills would indicate that the demand still exceeds supply. This imbalance is aggravated by the social engineering effects such as BEE which frequently skew the balance of skills. If only the system would recognize the serious loss of continuum created by expelling the older experienced white Engineers. When their intellect is gone, how will the younger Engineers develop?
We may have a bit of a breakthrough on the involvement of the retired Engineers as Mentors. To encourage this, as from April 2015, the SETAs are obligated to fund the training of Candidate Engineers.
Most of this funding is destined to pay Mentors in a structured mentorship process.
In reality, engineering remuneration is growing to hopefully compare with the other professions. Let's keep it that way. Professional recognition, upkeep of high standards and ethical conduct will raise the status of Engineers in society.
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Posted By Chris Reay,
Thursday, 25 September 2014
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For all the “must” talk in which those in government indulge, very little actually gets actioned. If there have been intentions to make it easier for small business to flourish, then they seem to fall into the category of rhetoric only. I learnt only this week of a new product line that the manufacturer has introduced into some 105 countries over that last five years, and who has stated that SA has been the most difficult, bureaucratic and plainly obstructive of all, as though the intention is to prevent the business from proceeding. And it is one which would enable the self-owned business or entrepreneur to develop and grow with little investment other than time, hard work and focus. We are all tired of reading the usual “speeches” by officials at the interminable conferences and congresses about what we “must” do. Most of it is simply common sense that does not need a Minister to harp on about as though it were new rocket science level discovery. “We must improve our science and maths at schools” stuff as though it was news to us. All interminable talk, little action. Now there are the new entry requirements for potential immigrants and tourists. Ministerial prerogative finds it acceptable to defy the objections from the airline industry, employers seeking specialized skills, tourists and business in general. The vulnerable falling Rand and investment rating downgrades do not encourage foreign skills currently on Dollar, Euro and Pound rates seeking a Rand equivalent in SA to get accepted. It’s too high for local industry. The “reality” dashboard shown last month continues to see the pointers moving further into the red. Is it believable that the policy makers can be so disconnected from the reality of an economy in crisis? The “cleva people” as defined by Zuma are noticeably and more audibly astonished and frustrated by the lack of concern and action. Do they really think that the NDP is going to save the country? Please, Mr Minister of Finance, do answer the question we have been asking for the last 3 years: from whence cometh the R840 billion to do the 18 SIPs projects (in three years - your own claim) and where will the required skilled engineering resources, placed in the right structures at the right time, come from? You will also need to rescue Eskom first. Shortly, a presentation on the most recent exercise on scarce engineering skills will be presented at Ministerial level. It has taken note of years of ineffective action and will make some radical proposals to get skills development moving properly. The SAIMechE input made it evident that candidate phase training needs to be taken seriously by both employers and the SETAs with the SAIMechE providing a facilitating role to enable the collective participation by Candidate, Employer, Mentor and Supervisor focusing on the criteria of the outcomes by which the programme is assessed. Those industries that are the likely participants in the SIPS/NDP will be asked to identify the resource needs at a job specification (not generic) level so that training in those disciplines can be actioned. I would like to ask one question of the Minister of Higher Education. Do the subsidies that are paid to universities for the students in the Faculties of Engineering and the Built Environment get used fully for that purpose, or are they diverted to other “non-engineering” causes?
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Posted By Chris Reay,
Thursday, 25 September 2014
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The South African economy is sick. The diagnosis has been going on for a long time, but the prescriptions have been ignored. It is evident that the body may not find the energy and perhaps the will to recover without some serious surgery. The danger of infection is greater as the invasive nature of the surgery is complex. The doctors and specialists (quacks?) may not succeed in finding a recovery routine before incapacity of the patient becomes permanent. To make matters worse, the patient is in a state hospital. I am writing these words as the engineering based industry, having just had a serious dose of platinum deficiency syndrome, is now steeped in a viral bout of non-metal-working plague. It is going to take a patient with a very strong immune system to overcome this one. Many of the limbs that support the body may simply not survive, suffer from permanent damage and shrink into a state of paralysis. All the machines (that are working) are monitoring the patient as follows. For clarity, the health monitor dashboard terminology has been calibrated with economic metrics. Productivity: declining with the record showing the index has shown a reduction of 41% in the last 10 years. The meter rider position shows that the current level is the lowest in 46 years. Employment: declining. Unemployment: Increasing Economic growth rate: Declining, now below 2% pa Rand parity with world currencies: declining. Rand: US$ 1994: 3.55:1 2014:10.80:1 International Investment rating: Declining towards junk bond status Corruption factor in government and the economy: increasing, reaching epidemic levels Infrastructure status, education and service standards: declining Small Medium Enterprises development rate: at best static but declining in small manufacturing. Inflation rate: increasing “Real” recession: evidently active and technically in stage of stagflation Cost of living of basic items basket: rising (at alarming rate) Centre of gravity of skilled and experienced engineering resources: moving into 50-60 age spectrum Potential for Engineers to survive economically at retirement: declining I do not think we need any more metrics to realize that the patient is in really big trouble.
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Posted By Chris Reay,
Thursday, 25 September 2014
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My interest and activities in the field of constraints theory over the last 15 years inevitably leads me to evaluate how its body of knowledge has impacted on industry. It was developed by the late Eli Goldratt, who described his reasoning behind developing the Theory of Constraints (TOC) was to help to teach the world to think more effectively. Perhaps the most resonant feature of TOC is that it simplifies complex issues due to the logical manner in which the thinking processes are applied. Project management has had few really significant breakthroughs over the last 50 years with the exception of the applications of the TOC to the processes. Reviewing the statistics published by organisations that carry out this type of research indicates that the overall project failure rate (as defined by collective metrics) had not changed since the early 80s and has remained at a level of some 70%. Indications are emerging that over recent years this may be starting to improve.
Projects essentially fail on the two main measures; costing well over original budget and finishing well beyond due completion date. In fact it can be said that there is no such thing as a project that meets its original cost estimate even though it may finish on due date. The challenges that arise in projects which require resolving normally face the inevitable conflict: finish on time at no increase in cost or finish at original cost with no increase in time.
TOC realized that until measures to address this typical conflict were created, the situation would not change. The thinking processes reviewed the assumptions being made and extent of the focus. The most interesting to me is that the changes that TOC proposes are of a human behavior nature rather than high-tech algorithmic solutions. When this difference is observed by the new-comer to TOC, the response is often “why all the hype, it looks like common sense to me”. Eli, is his characteristic way, would respond that the observation is entirely correct; the problem is that common sense is not that common.
Projects are once off activities and have not had the benefits of the production industry that has adopted the constraints theory to implement and practice the focusing steps. Touch time in projects is long whereas in production it is generally short. But both processes utilise the same fundamental rule of applying the focus onto the constraint, subordinating to it and making use of buffer capacity to meet the throughput requirements.
The evidence is now robust that the most effective project improvement that has occurred over recent times has been from the application of TOC methodology.
What can we learn from all this in the hoped-for implementation of the 18 NDP projects? It is apparent that whatever project approach one uses there is one endemic mistake made on so many projects today. That is, starting to construct before the design is complete, which is to me a culture driven by the bean- counter mentality that, in its ignorance, believes the project will finish sooner and cost less.
A quick lesson from TOC would propose the following: start activities as late as possible, ensure resources are available which includes design work, avoid multi-tasking with limited resources , cut the normal (over) estimated times back by 50%, allocate half to the task and half to the project buffer, start the activity on time and thereby run your project with safety in hand instead of losing it before you start.
The biggest concern I have for the NDP is the evident lack of engineering and project management capacity at the Owner’s team level. Will government, provinces and municipalities take this issue seriously and ask private industry to help with resourcing this?
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Posted By Chris Reay,
Thursday, 25 September 2014
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We have been subjected to the National Development Plan for some time now with various degrees of emphasis. Government, or at least in reality the ANC, continues to use it as a manifesto item typical of political posturing presumably to convince the public (and the voters) that the country is all set to have an era of great investment, new projects, employment opportunities, export improvements, and reversal of the fiscal deficits amongst many attributes. The better life for all stuff. The alliance continues to nitpick at it and academic and research organisations find flaws in the numbers and the statistics as though it is all an exact science. It has taken on the form of a sort of hallucinating drug that one places one’s faith in when faced with the current economic reality. It all depends on what is one’s own perspective of current reality. Engineers would be inclined to agree on the need for the NDP, the 18 Strategic Infrastructure Projects (SIPs) and the spin off from the designing, planning, constructing, commissioning, maintaining and operating of all these projects. These will use all the engineering capacity that we have, and more. Never mind from where the investment funds are to come from, that remains all smoke and mirrors and it’s hard to believe that the country will suddenly find R800 odd billion and then spend it over three years on completed projects. Perhaps closer to the Engineer’s concern is, if we had all that money, where are we going to find the sufficient number of engineering resources to spend it (properly)? We will avoid contemplating the potential behind the corruption that is now endemically entrenched in our country with very little accountability. The efforts to ascertain the available engineering resources by the PICC/SIPs/DHET/ECSA/Volunteer committees will presumably produce some results but so far the numbers do not seem more than high level estimates. I believe it was an exercise to find out what we already knew: we have a scarce skills problem. My own evaluation is that the systems and processes used cannot measure the extent of the scarcity in a meaningful way if the time frame is that of the SIPs programme. This is an example of breaching a very fundamental engineering ethos: if you cannot measure it, you do not know much about it. Clearly, if the metrics used to measure the scarcity do not take this into account, the process while necessary, is insufficient. The 18 SIPs projects are reasonably well defined at a high level. From this a start should be made to identify the required resources by a reasonable relationship between project size and type. The reality is however, that those who will need the resources normally specify the needs at a granular level, not a generic level that emerged from this committee. Efforts of the SAIMechE to propose a model to measure the needs, to locate as many as possible from the existing market and to focus Candidate Engineer development in those scarce areas are met with a sort of glazed, unconvinced response by the “authorities”. After all, we have to find ways to spend R800 billion effectively, but it would appear that to spend a few million on getting knowledge of the course to take to manage the scarce skills issue is considered either too expensive or unnecessary. The real reason is uncertain as the response has been nil. If the proposed model were to show a return on investment, it would only have to save about one thousandth of one percent of the programme budget to cover its cost. It’s a no-brainer when one realises the costs, delays and consequences of the scarce skills impact on projects. Take a look at Medupi and the Durban-Jhb pipeline as examples. Consider the impact on infrastructure service delivery alone. There are legendary other cases out there that show the result of technically incapacitated owners’ teams alone. But then that makes the assumption that the NDP actually is going to happen. If history is anything to go by, we may still be talking about it this time next year. With elections over and “won”, why hurry? At least it may all work as a dream forming drug.
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Posted By Chris Reay,
Tuesday, 27 May 2014
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The new outcomes
based registration system for Engineers is now underway albeit that ECSA has
not yet developed the online system for the capture of the submission data. The
release of the systems for Technologists, Technicians and Certificated
Engineers is in progress.
SAIMechE, under its
Professional Development Programme (PDP), has finalised the development of the
training curriculum for each of the eleven outcomes, the submission capture
formats and the introduction to the complete programme and the training
programme for Mentors who play a necessary, regular and specified role in the
process. The PDP has been developed using the exact outcome and assessment
criteria for registration as those formulated by ECSA under the R02 model.
SAIMechE will facilitate the Candidate's training programme by the provision of
the documentation that guides the Candidate on the requirements for each
outcome and the coordination of the activities via a monthly Mentor facilitated workshop per Candidate
cell.
We call this the
regular procedure that is intended to be applied to facilitate the training
programme for professional development for members of SAIMechE. This process
will result in the issue of an SAIMechE Certificate of Competence that will
enable any holder thereof to use the same content to apply for ECSA
registration.
A necessary condition for the process to work is the structured involvement of
the Mentor, and it is here that, for the PDP to
have its intended industry wide effect, the role of the "independent"
Mentor is
required. Currently, and under the legacy training system, the employer
provides Mentors from its own employ that provide the service to its own
employed Candidate Engineers. This generally limits the availability of
mentoring in the case of smaller businesses that may not have the capacity to
employ persons who can act as Mentors. The role of the Mentor in the legacy system is generally much
less involved than that required for the new system. Thus the PDP is, in
conjunction with the other VAs, ECSA and the "scarce skills" forums,
striving to obtain formal and substantial funding for free-lance Mentors to
undertake the mentoring role as a revenue earning activity.
Accordingly, SAIMechE is inviting
its members to consider applying for the role of Mentor for
the PDP. The role will be defined in the Mentor training programme. This includes the
review of all the PDP curriculum material, the workshop process, guidelines on
the forming of candidate cells for ease of access and meetings, referee roles,
sign-off documentation, remuneration and administration functions. The referee
or sign-off process must finally be done by a Mentor who is a Pr Eng.
Ideally the business model would encourage a Mentor to seek and oversee up to six
candidates in a cell who would all attend a one day workshop per month. Each
workshop addresses one of the eleven outcomes in turn, thus making eleven
workshops per annum per cell. Depending on the number of candidates available
to an area, a Mentor
could select to practice mentoring full time for as many days of the week he or
she chooses. Thus the income potential is attractive.
This is a bold move forward to stimulate the level of professionalism in
the industry and to utilise the valuable experience of the Mentor. The question remains, can we find sufficient
Mentors?
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Posted By Chris Reay,
Tuesday, 18 March 2014
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If ever there was a time when we wanted the good news, it must be
now. A time to listen to that
classic hit by Crocodile Harris " Give
me the good news”
If we accept the word forever
Maybe we should live together
And not be scared to watch
The late night news
You can't use guns to build a nation
A bullet never was creation
Engineering wise, SA is really in the doldrums. Can we be positive and
expect that things should now get better? That, of course, only happens if
people make it happen, so we can do some dreaming that we hope will turn to
reality. Positive thinking helps. Consider the options:
The active start to the National Development Plan. The 18 strategic
infrastructure projects actually start to happen. The talking and conferences
that have consumed any energy associated with them stop and the action starts.
We get let into the secret by treasury as to how these are to
funded. The engineering community is
invited to participate at the highest level in the Owners’ teams, the project
planning and conceptual engineering to ensure that the projects are correctly
structured, engineered and managed. The politicians wake up and realise that
it’s all about the built environment, and that is created by science and
experience, not hollow, electoral promises based on ignorance.
Government and private business interests start to work together for the
common goal of increasing the economic growth rate: what about an economic
codesa? Corruption gets serious attention.
The unions and the mining
industry together reach a win-win understanding and proceed to jointly
add value to our massive commodity assets sitting underground that are useless
unless mined and treated in a competitive manner. This in turn encourages the reluctant
and unconvinced investors to consider SA as a less risky investment
destination. Funds start to flow into
the economy again and the current account deficit reverses back to a reasonable
level. The Rand stabilizes.
Education? Well, while we are dreamimg and hoping, the training and
development of teachers becomes a reality as this is the primary necessary
condition for our youth to acquire the essentials of literacy and numeracy. The
30 % pass rate becomes history. Idle Funds in the skills development and Seta
accounts are applied to the training of engineering resources including the
funding of Mentors.
Last but not least, the government becomes convinced that cadre
deployment in place of resources with skills and expertise is a disaster.
If you are willing to be part of the solution, by clicking onto http://www.youtube.com/watch?v=JACJjid9WWY
should provide some inspiration.
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Posted By Chris Reay,
Wednesday, 11 December 2013
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Some recent investigations into the views that engineering resources
have on the benefit that they accrue from the HR function in their
organizations is most revealing. It is
almost entirely negative.
I adopted a neutral role in the inquiry process so as not to influence
the issue from an emotional perspective as I have my own views on the role of
HR in the recruitment process. It just was so evident that the consensus
confirmed my own views.
The first issue raised is how much do HR practitioners know about the
role of engineering functions that enables them to assemble a job specification
that is meaningful and practical?
The second issue raised is how much do HR practitioners know about the
role of engineering resources that enable them to actually evaluate CVs with
any credibility?
The third issue is how many engineering resources feel almost insulted
when requested to be interviewed by a young inexperienced HR person who may be
half the age of the candidate and possessing some soft skill qualification
perhaps at the most. Those that pass this session of questionable worth are
then selected to proceed to the line management interview.
Then the issue is raised as to the time line management spend evaluating
the CVs presented to them. It continues to astound me as to how fickle this is.
If the assortment of technical boxes is not ticked or the candidate is too old or has not been
in the same type of business, there is invariably a rejection. I have seen more
time spent adjudicating offers for a conventional pump than spent assessing the
credentials of the most valuable asset in the company: the Engineer.
We have a scarce skills problem and do not think that the current
economic downturn is going to have any significant impact on this other than in
the short term in specific roles.
Some suggestions to address this issue.
- HR must desist from making it apparent they are
constructing their own job needs by becoming a valueless and time
consuming constraint in the throughput
process of recruiting engineering resources into employers.
- HR must cease the process of "cutting and pasting” as
many functions in intricate detail into job specifications. Some of the
inclusions are hilarious at best.
- Any job specification that calls for a large number of
very specific skills and experiences that the employing body is calling must
ask themselves: where is their own
succession planning? Who "out there” is expected to provide these in place of
your own organisation?
- Enable communication between the candidate and the
line Engineer to discuss detail even before the formal interview.
- Use recruiters that understand Engineers and engineering as a profession.
- Start seriously undertaking the training of Candidate
Engineers within the employer organization and stop expecting 35 year old
Engineers with 15 years of high value project
and business experience to be
waiting around for your call.
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Posted By Chris Reay,
Wednesday, 06 November 2013
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At the recent workshop held by the Department of Higher Education
(DHET), the President’s Infrastructure Coordination Committee (PICC) and the
Council for the Built Environment (CBE), the objective was to assess the status
of the scarce skills in South
Africa by assembling Occupational Teams
(OTs) that would be assembled largely from the voluntary engineering
organizations and academia. Two days were spent following the earlier work done
by the PICC/DHET/CBE team to prepare a list of what was determined by the 18
Strategic Infrastructure Projects (SIPs) to be the scare skills for this
programme. This list covered the management, professional and trades identified
as such by the Organising Framework for Occupations (OFO) model.
The 18 SIPs are identified at a very high level, for example SIP1 being "Unlocking
the Northern mineral belt with the Waterberg as the catalyst”. For what was
alleged to be "security” reasons, not much else is published on this SIP to
expand on the detail, but it can be reliably gathered that a large component
will be for coal mining development to take up the supply that is dwindling in
the Witbank/Middelburg area.
The projected list of scarce skills, when reviewed on the basis that it
should enable some effective action to commence, is in my view a rather useless
piece of data insofar as the Mechanical Engineers are concerned. It simply
shows "about 500” needed at a scarcity level of "20-50%” whatever that may
convey.
The SAIMechE team filled in their answers to the OT list on the wide
spectrum of questions and these will then presumably be assembled and evaluated
for action with all the others. Most of the questions we have been addressing
for years that seem to do no more than lead to the next conference or workshop.
One simply comes away with the feeling of perpetual talk and no perceived
action.
The first concern the team had was that the workshop called for
voluntary conveners to fill variety of time consuming roles, and this just
seemed to illustrate a poor business model. Here we have the National
Development Programme (NDP) with its first 18 projects worth hundreds of billions
of Rand in total installed value (TIV) that
has no funds to pay for a properly structured resource development team that
would comprise a fraction of a percent of the TIV cost. It simply illustrates
the importance given to this role in the success of the programme. There is no contracted
leverage with voluntary teams.
The SAIMechE team made three constructive, actionable suggestions.
Firstly, establish a top level professional resources team who would be paid to
get the scarce skills issue measured and solutions developed, and which would
be in a position to advise the SIPs owner’s teams on the appropriate resources
required at owner’s level that could be seconded from the profession in a
similar way that the accounting profession does for state bodies.
Secondly, develop a model for evaluating availability of scarce skills
to identify the scarce resource with the relevant, engineering specific attributes.
It is based on the Engineer’s credo that you do not know much about anything
until you can define and measure it. Scarcity needs to have two references to
be measureable: what you have and what you need. Accordingly SAIMechE could
offer to facilitate working with professional engineering resource recruiting
bodies to create a large and well configured, best-in-class, dynamic database
of engineering resources for these and other South African projects. By simply
stating that we need a number of Mechanical Engineers does not resolve the
issue. The only time the real scarcity is known is when the employer specifies
the need at granular level of definition. For example one can search on Mechanical
Engineers and get hundreds, but then ask for those with the specifics such as 10
years of coal plant processing experience or conveyor and coal chute design,
one may be lucky to find a few if any under today’s dwindling expertise that
largely exists in near retirement age groups or who may have emigrated.
Thirdly, with this information and working with the employers
undertaking the projects and who issue the job specifications with these
details, we can identify those who should be taking on the Candidate Engineers
that wish to do their training under the SAIMechE Professional Development
Programme. SAIMechE would be the paid conduit to provide information on scarce skills to the PICC or the CBE on
an on-going basis enabled by the dynamics of the model. We need to ensure that
the expectation of perpetual voluntary work by professionals is not presumed.
It’s a business reality to pay for value. It would it addition be of value to be
able to second experts from the Membership, exploiting the immense, collective
intellectual capital of the Institution and effectively meeting the essence of the
mission statement.
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Posted By Chris Reay,
Friday, 20 September 2013
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After many months (years?) of no apparent action following the
publication of the National Development Plan, various bodies are now awakening
to the reality of the resource requirements in order to be able to effectively
manage and spend the billions on infrastructure projects.
It was always going to be a tough challenge: R800 odd billion over three
years. Someone was smoking something to actually believe that this was viable.
Dwell for a minute on the realities of project spend patterns. Firstly, no
spending pattern is ever linear, or in terms of Rand
over time, would it ever represent a consistent average from start to finish.
Thus represented, it is the area under the curve that amounts to the total
project spend.
Forward to reality: project spending patterns have the s-curve feature:
they rise slowly as concept, design, procurement occurs and then start to climb
steeply as deliveries and construction follow. It then tails off at
commissioning and handover. The essence of this that there is a peak, and for
the area under the curve to meet the project budget, the peak is considerably
higher than the average.
What does this mean? Most likely it means that resource needs are not
linear and have the same peaking nature. So when estimates are produced
reflecting the numbers of resources needed, are these factored by the time
axis? Most times not, and we invariably get the classic multi-tasking that is
imposed on the scarce resources. This then adds to the potential delay in due
performance dates being met. Multi-tasking creates its own delays, and anyone
who believes otherwise should attend a few workshops that demonstrate this
admirably.
Let’s then add another classic activity that for some pernicious reason
remains the foundation of project planning: critical path scheduling. How many
projects ever give consideration to the only development that has had the most
time and cost saving successes on projects over the last 50 years? It’s called
critical chain scheduling. As an aspirant believer in this process, it
continues to amaze me that management does not know that it even exists let
alone how it works. Far worse is the regular experience one has in presenting
the process to the potential users, who most times praise the fundamentals that
define the process, but return home only to be faced with the common response -
business as usual.
Well, the NDP could do a lot worse than, once the reality of limited
skilled and experienced resources has sunk home, have a good look at adopting a
critical chain scheduling philosophy. It may just assist in preventing the
project durations and costs to emulate the dreadful experiences we seem to have
with most major projects such as Medupi.
The usual responses continue to be heard to using such a significant
variation to standard procedure. It is too difficult: management won’t
understand it. Perhaps then we need to
study the experiences of major USA
and Japanese projects as examples that have proved the point. The main changes
occur in the human behavior of project management due the discipline imposed by
critical chain principles: prioritising projects, assuming most durations are
overestimated, aggregation and buffering of the safety before it’s lost, starting
on time and measuring progress in time and not money. It not only sounds
sensible, but it actually works.
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Posted By Chris Reay,
Monday, 19 August 2013
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It is hard to comprehend that our
once successful and world class power utility is now in such a parlous state of
diminished competence. The engineering professions have since 1992 warned that,
if the government believes in its economic growth projections based on GEAR and
ASGISA, then as with any power utility that depends for base load on the 6 pack
fossil or two reactor nuclear plant configurations, then start building them
without further delay, and to stop kidding themselves that private power
interests would want to get involved with investing here on the returns
available with the (admirable) historically low unit cost of Eskom’s supply.
Aside from now facing the reality of
a major national economic driver failure and the frustrations and anger of
business and citizens, Eskom will have to face up to the formidable task of
recreating the lost institutional memory and capital in the form of experienced
engineering resources to manage both the capital programme and the maintenance
of a very stretched system. My own observations and interaction with Eskom,
commencing some four years ago on the efforts to provide resource input to the
Capital Development Department have been nothing but amazing in the naivety and
misplaced belief then that all new Engineers would need to be black females!
The affirmative action obsession will come back and bite them big time. Eskom
now faces the additional challenge of global demand for good and experienced
power engineering resources. In a hysteresis-correcting like manner, they will
have to bend back dramatically to reverse their losses, as their mistaken
belief that training is going to solve this one should not fool the public. We
all know how long it takes to mould a useful, productive, experienced Engineer.
Overall the blame for being politically
naïve and failure to heed the advice of experts must lie with the government
and the Minister of Public Enterprises. It is hard to believe that those tasked
with the responsibility for energy management fell into the realm of
unconscious incompetence ie they did not know that they did not know, as the
warning bells were loud and clear long ago. I recall Ian Macrae, a past CEO of
Eskom, stating "if you stop Eskom growing, you stop the economy growing” How
true this is going to be. What must international investors now think about SA
as an investment option? Load shedding, rationed power, inadequate skills to
recover, the possibility of skills actually depleting further…..and worse, it
seems not much convincing light at the end of the tunnel. It is now time that
the government and Eskom paid some attention to the significant collective
expertise that exists out in the community in the form of retrenched and
retired white Engineers who have earned their T shirts in the power industry.
Eskom’s current constraint to recover
throughput as an active power generating asset will be the supply and retention
of skills. It will take some inventive strategy to get that act together but until
I see some real serious concern to realize this, then the consumer is going to
add desperation to the frustration that power rationing, higher tariffs and
unforeseen outages are the future for a long time. Below are some of the
statements from the Eskom annual report which I include for a bit of light,
masochistic reading:
"Eskom was recognised as a utility of
global stature in 2001 when it received the Financial Times award for the
Global Power Company of the Year.
Power outages in 2006 and 2007 have
brought into sharp focus the vulnerability of the power system. Several factors
came into play – higher than expected demand, unplanned outages, and more
importantly, a diminishing reserve capacity. In recent years the reserve margin
for generation capacity has shrunk to between 8% and 10%. We aspire to a
reserve margin of 15%.
As the provider of 95% of South Africa’s electricity, our contribution may
be the most fundamental of all in supporting economic growth in South Africa –
another reason for the exhilaration and heightened sense of mission that have
characterised Eskom’s activities over the past year”.
Missing conclusion: We ran out of
power because, together with government, we were not competent or experienced
enough to plan and manage the energy system of the country. Our exhilaration
may be short lived, as the disillusioned consumer must now pick up the tab for
our actions.
Just in case
the reader did not notice, this is a word for word repeat of the SA Mechanical
Engineer leader article of January 2008. The more they stay the same….
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Posted By Chris Reay,
Monday, 22 July 2013
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Engineering practitioners are feeling the pinch that is
engulfing most of the citizens of South Africa. We observe daily the
reaction to the rising cost of living, the almost demonic rise in basic
expenses that far exceed the published inflation figures. We indulge in the
ritual of finding reasons, and it being such an emotional issue, we
collectively are failing to rationally respond to finding solutions. Let’s
firstly take a look at one of the typical, evident symptoms.
The generation
and distribution of electricity must without question be an absolute and
necessary condition to enable a country to build a modern economy. A quick
review of the history over the last two decades reveals that Eskom did not
build any capacity into the system until the load-shedding crisis of 2007-2008
made it blatantly apparent that we were in big trouble. The projections by
energy experts and Eskom themselves since 1997 were not heeded by government.
It thought it would rely on the emergence of independent power producers and
not did listen to the warnings that such players only took part if the
investments made sense. Eskom had built many modern 6 pack stations that were
considered world class and lead the way with large units, the use of pithead
locations and the use of high-ash content coal. Eskom had developed a well
versed owner’s team with a top level intellectual memory and capacity that knew
about power generation, transmission and distribution. Their model was to
design and install stations that did not try to experiment with untested
technology and politically dictated management structures. It knew the need for
experienced skills.
Fast forward
to today. Our now infamous political interference habits are coming home to
bite us. Eskom, on top of a few bouts of knockout increases in tariffs, then
requires a 16% price adjustment per annum for at least the next five years. The
surpluses that had been generated were taken by the new government for other
uses instead of providing for a sinking fund. Lovely cash cow. Who worries
about the future capitalization? This is
then compounded by "removing” the retained intellectual memory and replacing it
with an inexperienced owner’s team. This team manages to mess with maintenance
as well, so that the reliability of the installed capacity is compromised.
Then the
message hits home: we must build two new stations: Medupi and Kusile. We are
not that good at estimating, especially as we decide to go for bespoke
specifications instead of, under the pressure of the circumstances, relying on
the experience of established project structures and know-how. The projected
costs of Medupi rise from (well who really knows?) anything from R87 billion to
now R105 billion and counting, and the date of first synchronization has moved
from 2011 to 2014. The messages from the site are scary: you do not know it
all. Be aware, things are bad.
So we connect
the dots and what does it reveal? It takes no rocket scientist to figure out
root cause. I have never indulged in that horror practice of being politically
correct, and whilst I will say this, it is now the almost universal opinion in
a noticeable crescendo.
Transformation
without education.
If that is not readily apparent, then one should
not be surprised at the dangers of a gathering storm.
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Posted By Chris Reay,
Thursday, 04 July 2013
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The phone
rang. "Hallo, Professional Engineer here. May I help you?” The voice on the
other end sounded a bit desperate. "I am JZ, the CEO of a company called RSA
Ltd and I am here with my Financial Director PG and my Operations Director TM”
We are enquiring whether you would be in a position to visit our works and give
us some advice. Our main production unit called the Economy Machine is giving a
lot of trouble”. "I’ll be right over” said Engineer.
In the
debriefing meeting, Engineer enquired as to the purpose of the machine, the
units of production and the throughout rate. "The machine is meant to produce a
product called a GDP. We set it up to
meet the needs of a market of about 50 million users, and to increase its
annual output by 7%. No matter what we do it hardly meets even half of the user
market, and is now only increasing by about 2% per year, and is absorbing most
of our capital. You can see it needs some fixing, and up to now we have not
used any Engineers, only our usual consultants. We think it may be time to
consider the views of an Engineer.
Professional
Engineer was then permitted to inspect the machine, test various components,
take readings and then produce his report, having addressed this complex
problem in accordance with the Exit Level Outcomes of the Engineer’s competency
criteria. The essential elements of the findings were as follows.
The
main problem is that the machine has three major functions that are all working
against each other, thus stifling GDP at the material mixing stage. The three parts
driving these functions are the Free Market Economy device, the SACP device and
the COSATU device. Each is directing the raw material into different processes.
There
are a large number of components fitted that are not up to the designers’
standards. We have listed many that were selected and fitted based on the
coloured boxes that come from the favoured suppliers, and not from those
meeting the working requirements in the specifications.
A
lot of the raw material feedstock and many of the essential parts and correct spares
for the machine have allegedly been removed from the factory, and are
unaccounted for in the materials audit we did. It appears no action is ever taken
to rectify this.The
electrical power to the machine has frequent trips. Switchboard distribution
components such as breakers are reset, a dangerous procedure, and no
maintenance records are evident on any of the equipment. Much of it has been
left in a dysfunctional state. Reviewing the costing records, the energy input
price and labour costs have escalated alarmingly and well over the market inflation
rate, and productivity of a GDP unit per worker has fallen by 40% over the last
10 years.
We
reviewed the company’s annual report to attempt to glean some earlier financial
and production records, and noted that the auditors have qualified their audit report
every year since 2000.
- We
noticed that many of the factory workers were not busy, and in enquiring from
HR, we were told that the cost of dismissing them is very high and that HR
spend most of their time at the CCMA putting the company’s case against workers
who have clearly failed to perform. In fact, while writing this report, the
machine was stopped and the workers were out on strike apparently demanding a
60% wage increase, free housing, free medical aid and shorter working hours.
- We
reviewed the qualifications of all employees to evaluate suitability for the
operation of a high technology
production business and we noted that none of the Directors and Senior Managers
has any technical qualifications or experience in GDP production.
Our
report accordingly recommends a complete
change of management, recruiting and training the appropriately qualified
staff, removal of the functions of the SACP and COSATU devices, disposal of all
the pirate parts used from the coloured boxes, re-order of the specified parts,
the overhaul of the electrical systems, and the immediate introduction of a
hire-and-fire labour policy. Without such measures, the machine and the factory
will have to close down, with the accompanied non-production of GDP and the
increase in unemployed workers. The shareholders need to act to replace the
Directors at the next AGM.
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Posted By Chris Reay,
Thursday, 06 June 2013
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On the 1st
April 2013 ECSA officially launched the new registration system. Initially this
has been done for the category of Professional Engineer, and will be followed
by those for Professional Certificated Engineer, Professional Technologist and
Professional Technician. The current (or now termed the legacy system) may be
selected by the candidate for Pr Eng up until the end of March 2015, but it is
expected that most new candidates will see the advantages of pursuing the new system.
For the uninitiated
who explores the process of applying as a candidate for registration, the
extent of the documentation and the interpretation of the requirements can be
somewhat overwhelming. It is all contained on the ECSA website.
The essential
differences between the two systems is that the legacy system focuses on the input criteria or training and
experience content, whereas the new system is based on an outcomes content and assessed against eleven specific assessment
criteria. Both pursue the achievement of professional competence as the
goal.
Of interest is that
the process is generic for all engineering disciplines and it only identifies
the discipline where the guidelines require that the type of workplace
environment must be appropriate for that discipline. The essence is to develop
professional competence and not a high level of technical skills. One could
readily conclude that the competence criteria would apply to just about any
other profession. After all, the ability to communicate well, be ethical, use
knowledge, analyse and solve problems and manage effectively must apply to any
profession, whether it be medical, legal, accounting or in soft skills. It is
perhaps a chance now for engineering resources to take up more assertive and
visible roles in structures outside of pure engineering. Could this be a
mechanism by which the engineering profession enhances its social status to be better
represented on corporate boards and government structures?
The need for
professionalism within the engineering ranks is being identified by many
employers with whom the Institution has interacted recently. Commentary such as
needing the types of competency skills outlined in the criteria rather than
super technical skills are becoming evident. "We can get technical know-how
relatively easily today from the available sources, but we cannot get the
professional competencies without the sort of development you are describing”
is not an infrequent response.
Accordingly, the
SAIMechE is developing the Professional Development Programme (PDP) to extend
the fundamentals of the ECSA requirements into a facilitated training and
development initiative that effectively enables the candidate to readily
envisage a practical process of achieving the required outcomes in their
workplace environment, how to interact with the supervisor and mentor and
participate in peer group sessions to
progressively practice and reach a competence standard at professional
level to confidently assume responsible roles in industry and society.
SAIMechE has
recently launched the Road to Registration workshop on the events
calendar. In due course, it envisages
each of the eleven exit level outcomes being offered as a full day workshop for
the benefit of registered and unregistered members.
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Posted By Chris Reay,
Friday, 12 April 2013
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The Editor mentioned to me the other day that she should issue a health
warning with some of my leader articles because they often create an acute case
of depression. This will in future be issued with the articles as it is becoming
increasingly difficult to construct positive and encouraging articles about the
state of the nation and the environment in which engineering has to play its
role.
Last month we took a look at the status of the mining industry and one
could not do much more than be pretty negative about the trend it has taken
over recent years. From being top spot so to speak for decades, we have slumped
to a mediocre level that replicates a number of other circumstances in our
country. And the bell tolled loud and clear this week when 4 major employers in
the EPCM industry advised that they were about to institute section 189
retrenchment programmes. They inevitably become the victims of the lack of new
mining spend which in turn does not happen because the investors in such
business have made it clear that other countries are able to offer a less risky
investment climate. Most of the analyst commentary on the issue has confirmed
this view. It is just appalling and almost treasonable that those in government
allowed the talk about nationalization to go so far without taking a firm hand,
ably assisted by incoherent mining policy.
It only goes to show that in such
matters of global economics and investor confidence that they do not know. And
worse is that they do not know that they do not know. It had little to do with
the Euro crisis which gets blamed for everything including lack of local
service delivery. Don’t mention the State of the Nation address because I will
then need the advice of the intended health warning.
On the matter of power, we note with some relief that NERSA saw fit to
refute giving Eskom the 16% escalation over the next five years, which on top
of the increases over the last three would have been catastrophic for industry,
business and the average citizen. Even the 8% is severe enough which means a
doubling of the price of electricity in less than 9 years, and it does not
include the mark-up that most municipalities will add on before charging the
consumer.
It causes one to reflect on what has happened to Eskom, and whilst it
gets the blame for such drastic price increases, it is really government policy
that caused the whole crisis. To have left the power capitalization industry to
virtually collapse from 1994 to 2007 was the collective decision of policy
makers who again demonstrated that they did not know that they did not know. In
that period Eskom became a cash-cow for government. It also became a show piece
of transformation where most of the established intellectual capital and memory
was methodically removed to satisfy a political whim. It became evident that
political identity was more important than experienced engineering and project
management skills that had been built up over decades of designing and building
the best six pack stations in the world.
The effective owner’s team had been
removed and replaced with the outsourcing to foreign based project houses.
Costs escalated and are exhibited in the horrific escalation on the price of
Medupi for example. Where was the sinking fund to finance the new station
build? It became necessary to charge the current consumers to fund the capital
expansion. Therein lies your 16% requirement. Whatever Eskom may say to the
contrary, it is borne out by the current nightmare that personifies our
electrical energy generation and distribution structures. Absolute power has
certainly disrupted the economy and will do so for the foreseeable future. How
do we reverse the slide to uncompetitive input costs?
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Posted By Chris Reay,
Tuesday, 12 March 2013
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You are a
Mechanical Engineer. You work in the South African industry. It would be hard
to find any activity that is some way does have some connections with the South
African mining industry. Connections take the form of user of the mined
commodity, supplier of equipment, supplier of services, and ultimately has some
dependence on the value that mining adds to the GDP of the country. If you are
part of a consultancy, a project management group, a construction company, a
financial group and countless businesses from large multi-million Rand
organizations to SMEs, it is very likely you will have connections with the
mining industry. Mining flows in the veins of South Africans and so it should.
We have been told that, following a Citibank survey, we literally sit on an
un-mined value of some $2.5 trillion in commodities. The largest in the world.
Just what did
we do with this asset that has been given to us for free and left to our
collective responsibility as a result of our being the residents and citizens
of the country? The early pioneers
started out bravely, successfully investing money, technology, hard work and
facing unprecedented risk head-on to build and place South Africa at the top of the gold
and diamond production world-wide. We have some 80% of the world’s known
platinum ore and a good deal of most of the others. We pioneered the mining of
high-ash content coal and assisted in the design and development of boilers
that can burn it effectively and efficiently to evolve some of the best and
most admired and low cost six pack power stations in the world that supported
the mining industry. In the early nineties we had some 800 high tech
researchers across the board tackling challenges in the mining industry. We
thankfully still have a flourishing mining supply industry that designs and
builds bespoke equipment to service the industry here and internationally. We
had the best Mining Engineers in the world, lots of them, and the older ones
mentored the younger ones as a matter of course. We were King of that shining
castle.
Take a
snapshot today. What comes to mind? Marikana, closed platinum shafts, strikes,
poor worker living conditions, reducing productivity, rapidly rising input
costs, electricity prices rising at a rate to not only render a lot of mining
uneconomic, but a lot of industry as well. We have dropped in the league of
gold mining countries from first to fifth. Where are many of our talented
mining resources? They are now running the mining industries in Australia, Canada,
South America and Central Africa. Our research
group has dropped by a factor of ten. International investors are openly
advising that we do not really feature on their screens at present: the
unchecked talk of nationalization, the regulatory confusion created by the
MPRDA and SIMS reports has taken its toll. Perceptions are real, not imaginary
as the Department of Mineral Resources (DMR) seems to think.
In my book, if
the rule applies that those who set the rules and call the shots must be
accountable, then that lies fair and square with the DMR. It is not surprising
that we see these debacles in the mining, energy, education, health, security
and infrastructure functions in South
Africa. When the goal is political power at
all costs ably assisted by inexperience and an illiterate and innumerate voter
support base, then do not be surprised when a competitive nation declines to
mediocrity.
If anyone can
propose a solution to extricate ourselves from this mess and turn ourselves up
again, then we need all the help we can get. Otherwise the bell tolls for thee.
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Posted By Chris Reay,
Friday, 11 January 2013
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I guess we
have to criticize the laws of the universe, those annoying and inviolate laws
of science and the basic engineering fundamentals for not taking account of the
inability of those "leading” the functions of the built environment development
and essential skills training in South Africa to achieve the
standards required to meet these laws. Why uphold compliance with nature’s laws
when it is much easier to change the need for them by a politically driven
relaxation? It is clearly far easier to decide to set regulations for
practitioners and contractors to use the surplus numbers of unqualified persons
to be awarded government contracts for purposes of building the infrastructure.
After all, with this policy and approach
we can meet the necessary political targets which seem to be far more important
than ensuring compliance with structural, life-cycle and safety standards that
have evolved over decades of proven engineering practice. We must learn to be satisfied
with our new-found decrees from those that rule, and we can even indulge in
some self-praise when we comment "……that bridge was nearly strong enough……… we
were quite close really”.
So, in
keeping with the above aspiration to continue our acceptance of adjusted
standards and drive for the common denominator leading to "a better life for
all”, the Minister, ably assisted by the cidb, has recently decreed the
following”
"The key amendments
include the removal of the requirement for contractors to have registered
professionals in their permanent employ; this is to be removed as it is not
viable to have such professionals in a contractor’s full-time employ". "The requirement for the Registered Professional is therefore being moved
from a contractor registration requirement to a contract management requirement
as a condition of contract”.
Essentially,
the roles of the Professional Engineer, Technologist and Technician will now
effectively be subservient to that of the registered Construction Manager on
matters where professional engineering judgment is required. I guess with the comedy of the self-inflicted
war games that have been played out between ECSA and the CBE over the important
subject of Identification of Engineering Work (IDoEW), not much more could have
been expected. Those unregistered Engineers or at least those practicing as
such can continue to act without any fear of liability as the rules that govern
registration, ethics and safe practice do not apply to them. The IDoEW
deliberations commenced in 2006. It’s now 2013 and we are still counting. The
profession has messed about arguing while we witness a steady entropic decline
in the built environment.
On the topic of
training of young Engineers in industry, I thought I would recall some gems
that arose in 2012 whilst endeavouring to persuade certain employers to
consider taking on basically good candidates and provide some development and experience
to assist feeding talent into the skills pool.
"We do not have the time, the money or the systems to train anyone. Just
find us a qualified and experienced Engineer. We need a PDI between 30 and 35,
with 15 years experience as an Engineering Manager”. (Allowed
cost to company will remain undisclosed here to protect the guilty.)
"We do not have time to train or develop anyone into this specialized role.
Please find us fully qualified candidates who can hit the ground running”.
No acceptable candidates have emerged to date.
Cyril
Ramaphosa has confirmed that the ANC policy is to spend R845 billion on
infrastructure in the next 3 years. I
found that his recent TV interview conveyed blind optimism and was most
unconvincing. I can only assume that he does not know that he does not know
what is needed to do that properly. Professional government and provincial owners’
teams and supply contractor capacity appear not to feature in his model.
Anyone who
cares about developing professional engineering skills should be made aware of
the new candidate training curriculum that will be instituted by ECSA and the
Voluntary Engineering Associations in April 2013. It identifies the exit level
outcomes that define the professional and will be the fastest and most
effective route to competence and registration that can be envisaged.
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Posted By Chris Reay,
Monday, 29 October 2012
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I often follow the debate on
the profiles, experiences, expectations and opinions of the issues concerning the
Baby Boomers (born 1940 t0 1960), The Generation Xs (1960 to 1975-ish), and the
Generation Ys (post 1976). These periods are derivations taken from many
historical analyses of the parties who study the phenomena of the age eras and
their characteristics. Probably the most significant
item that is relevant to all these age groups is that of lifestyle and the
values that define that. Each age group tends to indulge in the criticism of
the previous one laying blame for all the problems that beset their current
lifestyles. Characteristics such as social responsibilities, work ethics, corporate
practice, family stability, wealth profile and continuity of employment are
significant items. It just seems to be easier to blame the earlier generation
for its own generation’s problems rather than exhibit and practice leadership
and responsibility for one’s own.
Corporate value systems have
changed with the evolution of bottom line items that go beyond profit. Awareness
of the environment, ecology and health systems have emerged strongly where the
impacts of these are able to be managed with technology development.
In engineering education
training and practice, it is not uncommon to witness those who question the
effectiveness of present-day curricula which in real terms have not differed
significantly from those of earlier generations. Obviously the tools that
facilitate learning have changed with modern information technology
developments such as computers, software and digital configuration. How often
has one heard the comments questioning the inclusion of certain academic basics
into programmes where the graduate has claimed that such learning has never
been applied in their subsequent careers? In engineering curricula this may be
a truism but the challenge is that due to the "connectedness” of science and
technology, where does one omit such content?
The great thing about an
engineering curriculum is that it addresses the challenge of tackling those
aspects of life that do not radically change: the laws of nature and science
remain intact, the fundamentals still exist, the approach to problem solving and
the need to develop empirical competence are still the foundations of the Engineer’s world. They are
the toolbox for future applications. What does matter thereafter is the
training and practice of how to use them to build the environment we purport to
do better than any other profession.
The matter of becoming
competent to apply these principals, plus those of management and economics,
then need to be assessed as to their relevance of past experiences on modern
engineering practice. Have these changed other than for the tweaking required for
inclusion of new technologies, materials development, and refinement of codes
of practice for example? What age group is the right mentorship group? Are the
retired or semi-retired the right dispensers of experiential skills and advice?
Has this thinking now emerged for the reason that each generation of Engineers from
the baby boomer era was both supervised and mentored by the next level in the
system as a matter of course where is was not called "official mentoring” but de
facto on the job development in the process of evolving the next skills layer?
There was clear period of
world practice in infrastructure development with the emergence of industry,
production and modern supply chain logistics. Large projects covering all the
technologies were common: energy development, transport, communications and
service industries emerged that had decades of continuity that encouraged
sequential training and development of practical skills.
We must question why we now have
an era where this has reduced significantly and it is evident that
internationally well experienced skills in the lower, active age groups are in very
short supply.
From a human development
perspective, the period over which a candidate Engineer needs to develop
sufficient competencies to be recognized as a professional will not have
changed. Gladwell’s theory on the 10,000 hour rule probably applies where any
person claiming expertise will have spent 10,000 hours odd developing that
expertise. So the candidacy phase which is set as 3 years minimum is rarely
met, and the statistics show that 5 years is the norm. If you work that out, it
is about 10,000 hours.
Until we return to the era of
on-the-job sequential skills development, we will have to recall the retired
and semi-retired who are willing to fill this space. Regrettably in SA, we have
bolstered the loss of this intellectual capacity by dumb affirmative action
politics and short term financial returns. The challenge is when this capacity
is not available in books or boxes, it is the only option. This capacity must
be applied sensibly to the emerging graduate training programmes to make the
most of their 10,000 hours needed to reach a recognized level of professional
competence.
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Posted By Chris Reay,
Monday, 17 September 2012
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In June
last year, the commission released a diagnostic document which stated that the
elimination of poverty and the reduction of inequality were the objectives of a
long term plan, but that nine key challenges stood in the way. Let’s call these
the Undesirable Effects or UDEs for short.
- Too few people work.
- The quality of school
education for black people is poor.
- Infrastructure is poorly
located, inadequate and under-maintained.
- Spatial divides hobble
inclusive development.
- The economy is unsustainably
resource intensive.
- The public health system
cannot meet demand or sustain quality.
- Public services are uneven
and often of poor quality.
- Corruption levels are high.
- South Africa remains a divided society.
Then, in
November, the commission produced a draft National Development Plan for 2030.
It contained recommendations covering the following areas. Let’s call these the
Desirable Effects or DEs for short. We can see that these are in effect the
inverts of the UDEs, and hence become objectives or what we will classify as
ambitious targets.
- Create jobs
- Education and training
- Expand infrastructure
- Transform urban and rural spaces
- Transition to a low carbon economy
- Provide health care
- Build a capable state
- Fight corruption
- Transformation and unity
Then comes the following, almost casual assumption: South Africa can become
the country we want it to become. It is possible to get rid of poverty and reduce inequality in 20 years. We have the people, the goodwill, the skills,
the resources – and now, a plan.
Assuming that the ANC finds the time
at their Mangaung conference to review and approve the plan, then the 20 year
implementation process has to actually start. The ANC has never shown any glory
in action and implementation to follow their renowned rhetoric, so herein lies
the test to see whether the assumption made by the plan is more than the usual
innuendo.
Let’s take a reality check on the
proposed elements of the plan. We can approach this with a mindset that has
evolved from a fairly long exposure and many practical applications of the
theory of constraints, commonly abbreviated to TOC. It is evident that this NDP challenge is a
case of aspiring to a number of ambitious targets that not only require the full
dependence on their specific necessary and sufficient conditions, but that such
conditions can exist without any mutual conflicts. The practice of using the
strategic and tactical mechanisms of the ambitious target process makes the
assumption that the target is achievable and is approached in a confident frame
of mind rather than one of disbelieving scepticism, which understandably, most
commentary on the NDP has generated so far. Intuitively,
the NDP is doomed to failure primarily as a result of an historical lack of
effective management execution in SA. Any amount of political innuendo will
not overcome that reality. What we can only hope for is that the government, as
the sponsors so to speak of the plan, will draw on the intelligence, skills,
experience and proven competence of available resources to set up, design,
articulate, prescribe and monitor the plans making up what we should in fact
call a programme, as it
will be a collection of interactive
and dependent projects each requiring skilled planning and management
execution. The best must be used, not the most politically favoured.
There is one very fundamental factor that will render this
programme so challenging that it should convince us of the need for the most radical,
urgent, collective effort. I will simply
call it the Rule of exponential projections. It is evident in reviewing the
listed DEs that every one of them is essentially population growth rate
dependent. From 2000 to 2011 the Mundi index shows that the growth has been
12,8% in net gain of population numbers, or an annualised rate of 1,2%. This moderately
low (recent) increase in the population was due to the escalation in HIV/Aids driven
deaths. How this will change in the next 20 years is an unknown, but it could
increase if the treatment measures are effective. 30% of the current population
is 14 years old or less and all reaching the job market age in this period. There
are an estimated 4,7m unemployed persons in the employment spectrum at present,
so a rough projection shows that we need to create about 4.7 m, plus those jobs
to employ the 14 year olds, plus the result of the population growth over this
period. In my maths, the NPC vision to create 11 m jobs (see the plan) over the
next 20 years means we shall have more unemployed in numbers than we have at
present. So the elimination of unemployment and hence poverty would appear to
be a pipedream and we question whether it has taken exponential growth into
account.
Clearly economic growth is required to create these jobs and
it has to occur at a higher exponential
rate that of the population needing employment. How does one converge these
two lines? We either limit the growth rate of the independent variable
(population) or radically increase the dependent variable (economic growth
rate). If not, the lines diverge and the problem becomes greater. Many goals
are missed due to the prevalence of linear thinking.
The ability to provide the management execution to all these
components of the programme requires skilled and experienced resources (primarily
technical: Engineers, Technologists and Technicians) to be available at the
right level and numbers to implement the projects: infrastructure for example requires
that the reinvestment into the assets of the infrastructure must equal the rate
of depreciation just to remain static. Again we will find that the curves
diverge if we cannot reverse the current trend in historical deterioration of
these assets without replacement. The infrastructure is currently in a state of
serious entropic decline with little evidence of major projects in the
pipeline.
If the growth rate of urbanisation which is a major factor
in overload and breakdown of infrastructure exceeds the rate of infrastructure growth
by only 3,5% per annum, the magnitude of collapsed and underserviced urban
population with all its attendant troubles will double in 20 years.
What are the simple fundamentals that must be followed in
the big plan or programme? Firstly, identify the goal of each ambitious target
of the programme, identify the constraints, subordinate to them, elevate them
and keep following this process ensuring that interim pre-defined milestones
are being met. Prioritise what will
drive the throughput to meet the goal. Do
what should be done and do not do what should not be done. Do not waste
resources and time, for example changing town and road names, when the
resources should be used to manage the required activities to achieve the
programme objectives. Utilise the best available management and capacity to
execute the processes.
South
Africa has a major constraint in the
numbers of productive resources that it can apply to this pending challenge.
Unless some sense is brought into the skills space alone that reverses the
current trend to enforce misplaced affirmative action, uses the experienced
skilled (and ageing) work force, raises compliance levels for entrance to
learning institutions, discontinues the employment of political appointees into
roles instead of competent persons selected on merit, reviews the negative
impact of the labour laws, formulates effective policy on small business
development, and identifies measurable, interim milestones over the next twenty
years, then I have to say that the great plan will fail on the basis that
reality is again being replaced with political imperatives that make the appeal
of the planning commission to the public to join forces "to make miracles”
nothing more than hollow rhetoric we have come so used to hearing. And the exponential rule waits for no one.
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Posted By Chris Reay,
Thursday, 16 August 2012
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Most
commentaries on the status of the mining
industry in South
Africa
refer to the decline in our rankings within the international
comparisons. Mining is essentially the industry that developed the SA economy
and which spawned the support industries that provided the equipment and
services.
Our unique
Government Certificate of Competency evolved from the early 1900s to develop
safer working conditions and improved skills for the activities of the mining
industry. A recent international survey ranked SA at the top of the list for
the value of minerals in the ground at the awesome figure of R2,5 trillion,
well ahead of Russia
in second place. With such credentials we have, however, declined in our competitiveness
as growth markets have increased the demand for resources. We effectively lost
out on participating in the last resources boom that witnessed countries such
as Australia, Canada, many in Africa north of us and many in South America actively rise in the provider stakes.
Various reasons are debated for this, but the most frequently identified are
poor and slow policy making, the references to nationalization, the reduction in
our capacity for research and development and the accompanied loss of
experienced skills. In more recent times, the sudden increase in energy costs
and industrial strike action have added to the reversal in our competitiveness.
In September
the next Electra Mining exhibition will be held which is one of the largest of
its type internationally, and which from all accounts, will be well supported. In
particular the action in Africa north of us is
significant and we have seen many of our project management, design and
construction skills moving to manage these northern projects. Some of our EPCM
companies have such projects that make up the bulk of their order book. Further afield, estimates put the human
resources running the Australian mining industry to be over 50% of South
African origin.
With the
slump in the platinum price which has placed a number of mines on a caretaker
basis or a scramble to try and manage with fewer contracted resources, can the
stakeholders, being investors, government, and the mining industry address the
skills issues that are even in the present circumstances in short supply? Most of those with whom I interact express
the fear about what are we going to do when the lights really come on again -
once the European and American recessionary conditions change and the world
demand for minerals resumes?
Reports on
the diminished R&D capacity and skills in the research establishments, that
in the 80s and early 90s were world leaders in mining research and development,
are of great concern as the ability to innovate disappears. Clearly mining
activity also depends on reliable infrastructure and good logistics which are
not well positioned either at present.
In the vein
of " ‘n boer maak a plan” in which South Africans have shown an adept ability,
can we tackle this huge challenge and get our competitiveness on the rise? It
cannot be beyond our ability and willingness to do some serious mining skills
development together with that needed across the whole engineering domain. It
is time we saw some next steps in the action territory after the publication of
the diagnostic report of the National Planning Commission. It could be in
danger of becoming another book shelf study.
We really
need to curtail our incessant, negative outlook on this state of affairs and
try to get collective, positive group action to turn our mining status around.
However, from where will this be triggered and what will catalyze the process?
Perhaps the
Electra Mining event could energise some reality here. The SAIMechE is to
facilitate the first of its Soap Box sessions which will be interesting to
watch. Let’s hope the speakers will be able to address some of these issues and
spawn some industry enthusiasm to make things happen. One can safely say that
the survival of South Africa
depends on it.
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