by Nicole Spruijt

INSPIRATION - THE GREATEST KEY TO LEADERSHIP

Mr Siyabonga Gama, Group Chief executive of Transnet discusses the drive to take the company into the digital future, investment in infrastructure and people, and the most inspirational aspects of his role

BBQ_Cover_-_Colour.jpg

As one of the earliest modes of transport, the railway system, is without a shadow of a doubt the backbone of development—shuttling supplies to and from the ports and mines, aiding in building a nation.

If there is any State-Owned Company (SOC) for which South Africans can feel pride, it is Transnet SOC Ltd (Transnet). Under the hands-on, watchful eye of seasoned Transnet Group Chief Executive, Siyabonga Gama, their financials read like a near-perfect story. No longer can the railways be seen as an industry that should be relegated to the history books, Gama is ensuring that Transnet is keeping up with technology and taking rail into the future.

Whilst brick and mortar retailers might be on the decrease, with online shopping taking over, it is easy to forget that railways and ports are still the bloodlines of development. Gama is not one to sit back and let the world go by, he is a hands-on visionary ready to take Transnet to newer heights.

From simple beginnings

The true roots of Transnet go back in time to the mid-1850s, when the development of a railway system was proposed for the harbours of the Cape and Natal. The first railway was launched in the, then, small township of Durban. The journey was approximately 3.2 km, which took a maximum of five minutes. This seems incredulous if one considers the number of railway tracks in operation today. In 1867, following the discovery of diamonds in Kimberly, the need for the expansion of ports and railways became apparent. In 1872, the Cape railway became government property, followed by the Natal railway in 1877, ultimately becoming the starting block for what we know as Transnet today.

In 1910, when Union was achieved, the country’s leaders were ever more resolute that the harbours and railways should further unify and develop the land and the economy, and so the South African Railways and Harbours Administration was born. Twenty years later, in 1930, South Africa was using these systems, not only to develop infrastructure but also to move people around. The increase of passenger lines was the yesteryear equivalent of today’s digital globalisation.

Thanks to the burgeoning success of the railways, the government of the 1970s, and again in the 1980s deemed that the South African Railways and Harbours Administration should be run along defined business lines. The South African Transport Services arose and encompassed the railway, harbours, road transport, aviation and pipeline operations. On 1 April 1990, following 80 years under the control of the government, the South African Transport Services was given the status of a limited liability company and was renamed Transnet SOC Ltd.

Since 1994, Transnet has not lagged in dealing with an array of challenges present in a young democracy—there have been some bad times, but Transnet has, through constantly investing in infrastructure and the people of South Africa, kept the country running.

Agile, digital, united and admired

Although not immune to socio-economic and political realities faced by many African organisations over the past few decades, Transnet continues on a steady growth trajectory. As a means of negating the volatility of the market, a strategy needed to be developed through which to achieve success. The new premise is based on the strategic aspirations of agile, digital, united and admired. Gama says, “Looking ahead, we will be driven by our strong desire to achieve greater and sustainable outcomes with higher levels of innovation and agility. New markets are opening up and we can use integrated port, rail and pipeline solutions to take advantage of these new opportunities for increasing our revenue and profitability.”

As economic growth in Africa unfolds, the demand for rolling stock and associated maintenance will increase. In response to this, Transnet is undertaking a diversification strategy that will be driven through our recently approved Transnet International Holdings, a special purpose vehicle to execute the company’s geographic expansion strategy. Under this strategy, Transnet has a long-term vision to create an integrated freight system in the region. The scope of opportunities under consideration is very broad, ranging from; advisory work through to design, build, operate and transfer concessions in the logistics space. “We are also seeking to improve operational skills on the continent by creating spaces for African students in our various technical schools. Our efforts thus far have seen a significant improvement in cross-border rail volumes and participation in regional ports,” elaborates Gama.

The African sun is rising and it’s digital

In line with the Africa-focused goals, Gama is passionate when describing the utterly important role of political leadership in the acceleration of the continent’s industrialisation.

“It is incredibly important to articulate the vision of an Africa that is rising. For many decades, we were perceived as the continent that was most lagging in technology, yet it is through the political leadership that we have seen that seven of the 10 fastest growing economies are from Africa. Through effective political leadership, people are able to seize opportunities, which, in turn, raises employment and standards of living.”

In January 2017, Transnet announced its plan to partner with General Electric in order to digitise the transport sector, this partnership will deliver a digital solution that will seamlessly connect shippers and transport operators, making it increasingly easier for a company to understand pricing and capacity on the network, plan a shipment and get their goods to market. Ultimately, this will aid in the strengthening of the supply chain across the continent and, indeed, across the globe, which will, in turn, allow for repeat orders from customers, thereby boosting the African economy. It will connect shippers and transport operators by providing real-time, data-driven insights on the status of shipments. It takes laborious processes, like payment, customs and inspection, from paper to digital, and creates an on-demand solution for transporting freight inspired by consumer on-demand transportation models.

The digital solution will be enabled by Predix, the operating system for GE’s Industrial Internet or Internet of Things.

The locomotive acquisition programme

The locomotive acquisition programme is a fundamental part of Transnet’s infrastructure investment programme aimed at renewing the locomotive fleet to improve customer service. Transnet awarded a contract for the acquisition of 1 064 diesel and electric locomotives to four Original Equipment manufacturers—China South Rail, China North Rail, Bombardier Transportation and General Electric. CNR and Bombardier have recently commenced production at Transnet's facilities in Durban.

This project is testament to Gama’s increased awareness and dedication to transparency. The locomotive acquisition programme is one of the largest in recent years and when asked about the procurement process, Gama says: ”The contracts were awarded following an open and public tender process overseen by the Board of Directors through a sub-committee of independent directors. In addition, the evaluation of the bids was monitored by Transnet’s internal audit to ensure that the process complied with the highest standards of governance as required by the Public Finance Management Act.”

Transnet is committed to continuous improvement in all its processes at management, governance and operational levels. In line with that philosophy, the company has set up a special committee made up of mainly independent non-executive directors to review the company’s processes relating to the locomotive acquisition programme. The company has engaged independent attorneys, Werksmans, to oversee the process.

Defences

The recent downgrades from various credit rating areas could have had a major impact on the future financial security of Transnet. Gama explains why it was relatively unscathed, even with the close link to government.

“Transnet raises funding for its capital investment programme on the strength of its financial position, with no government guarantees. The company evaluated the potential impact of the credit ratings downgrade on its financial position, liquidity and solvency and expects no significant negative effect compared to previous estimates, as the probability of a credit ratings downgrade had already been considered,” he says.

During the previous financial year, Transnet proactively and successfully renegotiated R29.1-billion of debt to lower and relax the credit rating default triggers to below sub-investment grade, in view of expected rating agencies’ downgrades.

In April 2017, Standard & Poor’s reviewed the company’s foreign currency rating to BB+ from BBB—and the local currency to BBB—from BBB, both with a negative outlook. This followed a similar action on the sovereign as Transnet is viewed to be closely linked to the Government. S&P, however, maintained Transnet’s stand-alone credit profile at ‘BBB’, reflecting the company’s strong financial metrics as the company executes its multi-billion-rand infrastructure investment programme.

The Siya magic

Gama holds numerous degrees and qualifications, achieved from countries across the globe, but more than this, his passion for Transnet is palpable. He is no amateur when it comes to leadership and foresight, so it is, therefore, no surprise that Transnet is doing so well under his leadership.

A common error is the belief that managers are natural leaders—nothing could be further from the truth. Leaders motivate and nurture, whilst managers believe they are untouchable and, therefore, ‘tell’ the staff what to do and what not to do. Gama is indeed a leader.

“A good leader is able to effectively articulate, with strategic clarity, the goals of the business in such a manner as to take the people on that road to success. An effective leader collaborates, communicates, and motivates, they trust their employees to always do their best, without hovering over their shoulders.

“When the fires are burning, a true leader is not afraid to stand in the firing line but at the same time, knowing when it is important to let the team take the lead. A person who is authentic does what they say they will, that’s someone people can trust. Someone who possesses integrity is someone able to lead,” he says.

Gama believes that in any leadership role, a time will come when these traits will need to become visible.

“When you are in a leadership position, you are effectively, on a stage. Everyone is looking to you for your reactions. It is, therefore, fundamental to know yourself, to be authentic, and live by integrity. Sometimes, in the course of any leadership role, there will be times when difficult decisions need to be made, when there is no clear winner in a situation—you need to come from an ethical and moral base from which to make those decisions. It is also important to remember that as a human being, the only thing you really control and own is your reputation,” he explains.

Assuming that leaders are proficient in every element of business, is not only irrational but adds unnecessary pressure on the leadership team. “Understanding your weaknesses, and having a cadre of people who complement your skill set doesn’t mean that you are incapable of management—in fact, it means quite the opposite,” Gama says.

Fundamentally, being surrounded by people from different backgrounds, levels of education and experience allows leaders to view the organisation from a holistic point of view and allows for the creation of solutions to problems, which may not have been possible.

The average person most likely doesn’t think about the railways too much, as goods arrive at the supermarkets, or on building sites, or, indeed, at our very front doors without effort on the part of the consumer. Yet, Transnet is indeed a life source for the nation, employing approximately 60 000 people, developing communities and building a stronger economy through infrastructure and social development.

Gama is no pushover though, he believes in setting challenging goals and objectives is the key to success. Then, providing employees with the tools to achieve those goals creates a sense of self-worth amongst employees and the communities in which Transnet operates.

Gama is passionate about the people within the organisation.

“One of the key things I am excited about in my role as CEO is galvanising human beings. Setting tough challenges that people think they are unable to achieve is motivating, but seeing them achieve those goals is the highlight. Developing them to have self-belief, to know they are able to achieve monumental things is a driving force behind the Transnet philosophy. When they succeed—the entire organisation succeeds,” he says.

“When people attack you, and they will, when they accuse you of things, you know you are incapable of doing, you may even start to believe them if you are not grounded. It is, therefore, important to know who you are, before you start the journey.

Leadership is about knowing that every human has strengths and weaknesses. Being open to different opinions and views allows for leadership to make decisions for the best of the business. Develop the people in the organisation to achieve the best results. Drive change in the communities in which you operate and if you are able to achieve these goals, the business objectives will be met. Leadership isn’t without challenges, it is ultimately how you, as the leader, define success,” he concludes.

comments powered by Disqus

RW1
R1
R1
R1

This edition

Issue 73
Current


Archive


BBQ_Magazine_SA The link between learning agility and team performance https://t.co/l7fYDeh2HC https://t.co/VMd38agKoi 2 months - reply - retweet - favorite

BBQ_Magazine_SA The Big Time Strategic Group BBQ Awards will be hosted at Emperors Palace, on the 20 October 2017. Read moreā€¦ https://t.co/oCSEzHnxQW 3 months - reply - retweet - favorite

BBQ_Magazine_SA Opportunities ripe for female entrepreneurs to shatter glass ceiling https://t.co/TkziEkG2Za https://t.co/WNas3E16k3 3 months - reply - retweet - favorite

  • Mxolisi G Waka Ndlovu
  • Terrence Damster
  • Hle Msweli
  • Khumbulani Mathaba