Abstract
Eskom Holdings SOC Ltd (a State-Owned Company), Registration Number 2002/015527/30, is South Africa’s primary electricity supplier which is wholly owned by the South African government. Eskom’s mission is to provide sustainable electricity solutions to grow the economy and improve the quality of life of the people in South Africa and in the region. Owing to its strategic importance in the country, Eskom is compelled to procure different commodities and services strategically to ensure sustainable electricity provision to consumers while driving supplier development for security of supply. As a result, strategic sourcing was introduced as a way to procure commodities and supplier development as a mechanism to drive industry growth in the energy sector. To maximise multiple benefits for the company, integration and collaborative framework between strategic sourcing and supplier development is a fundamental aspect that should be given attention.
The study analysed how strategic sourcing can be a catalyst for supplier development in Eskom. An exploratory research design and a mixed research methods (quantitative and qualitative) were employed. Non-probability purposive sampling was applied to select respondents and participants. Survey instruments (semi-structured questionnaires) were administered to commodity managers and middle managers in Commodity Sourcing and Supplier Development and Localisation departments respectively. Face-to-face interviews were conducted with executive management at Eskom. Data were analysed through content analysis.
The results and findings of the study revealed that there is no unified and systematic approach on the planning, implementation and monitoring tasks between the two departments. It was found that procurement spend in Commodity Sourcing is used to drive supplier development objectives but commodity managers are not contracted on the objectives. Nevertheless, strategic sourcing is viewed as a great mechanism to advance supplier development objectives provided a joint planning, execution and monitoring and reporting is done appropriately.
It is important that an operating model between the two departments or entire Group Commercial be reviewed and four recommendations and areas for future research are articulated.
M.Com. (Business Management)