The application of the Viable System Model to enhance Transnet property’s business efficiency.

Abstract

Transnet Property is an operating division that manages the non-core property portfolio and provides property specialised services for the entire Transnet property portfolio. The non-core portfolio that is currently managed by Transnet Property is worth approximately R5 billion, and comprises of commercial and residential properties. The commercial portfolio consists of office, retail, warehousing, industrial, vacant land and agricultural space whilst the residential portfolio consist of vacant stands, individual houses, bulk residential, lodges, hostels and line camps. However, the non-core property portfolio encompasses only 13% of the total Transnet property portfolio, which is spread across its operating divisions, and its current worth is approximately R30 billion (2014/15). This substantial portfolio places Transnet as one of the significant property owners in South Africa. The aim of the study is to apply the Viable Systems Model (VSM) to thoroughly diagnose most of Transnet Property’s challenges in a structured and easy to solve manner. The VSM which forms part of the system’s theory, assists management practitioners to be able to break down the whole system (i.e. the organization) into smaller manageable parts using the Law of Near Decomposability, Richter and Basten (2014). The smaller and more manageable parts of the whole system also enabled the researcher and the participants to drill down into specific challenges that were presented by each small system. The research study was qualitative in nature. The case study, observations, interviews, value stream mapping and interpretative phenomenological analysis (IPA) are some of the methods and tools that were used to analyse and make sense of the data collected from all the study participants. The researcher observed that adopting the VSM theory relating to cybernetic principles of feed-forward and feedback, assisted in averting a possible state of crisis in managing the entire study The challenges that were diagnosed and discussed in the report are summarized as follows: a) Unclear purpose and interaction of systems which highlighted issues relating to duplication of work packages, inexistence of departmental strategies and the lack of integrated of processes and systems; b) Manual and ineffective business processes relating to master data management, contract management and utilities management; c) Ineffective communication across the organization. There were a number of recommendations that were proposed by the research participants. The high level recommendations that were covered extensively in the report can be summarized as follows: a) TP Exco should appoint a strategist or strategy expert who will assist in the development of a comprehensive TP Strategy that is aligned to the Transnet Group Market Demand Strategy (MDS); b) TP Exco should prioritize the development of standard operating procedures (SOP’s) that consist of a clear RACI matrix which is in line with the approved Transnet SOC Ltd’s delegation of authority matrix. The SOP’s should be comprehensive and governed by a properly mapped out, integrated and automated business process. The TP’s Information Technology (IT) Department should ensure that the IT systems adhere to the RACI matrix when issuing the automated systems notifications to the various departments to avoid duplication of work packages; c) The TP leadership should invest its resources in the creation of a more trusting, enabling and motivating environment. The TP leadership should also consider to schedule regular visits to the regions to communicate any changes and updates in the environment. The visits to the regions should be geared towards motivating the staff and boosting staff morale and motivation.