Recognition of excellence – Operations and Maintenance of infrastructure
The Water Research Commission (WRC) in partnership with the CSIR and private sector water services provider Amanz’ abantu Services have undertaken studies that focus on improving operations and maintenance (O&M) within the water services.
The Managing Director of Amanz’ abantu Mr Oliver Ive received a WRC Knowledge Tree Award on 26 September in Pretoria for their outstanding work in lending private sector support which has led to the successful pilot implementation of water services franchising in schools and homesteads in the Eastern Cape. The award was given to projects that have contributed to job creation, economic development through innovative interventions or technologies.
The WRC has been researching a partnership concept, making use of the principles of franchising, for improved water services infrastructure operation and maintenance. The concept has been formulated with a view to improving water services operational quality and efficiency through introducing a new supply-side operation and maintenance provider mechanism to water services. It addresses the lack of higher-level expertise that has so often been identified as a key to improvement of service, especially in the more remote areas. The local staff can deal with day-to-day operational needs, but are not able to deal with anything more demanding than that.
The essence of water services franchising partnerships is the creation of a pool of appropriate expertise upon which the local operators can draw a restructuring of the local responsibility for operating, and the creation of a two-way obligation – an obligation to call for assistance from the pool, and an obligation to respond rapidly to that call. All of this together with the incentive structures to ensure that it happens.
In setting up a franchisor-franchisee partnership, the sequence of events will probably be that it will initially only be entities (companies or large NGOs) that see themselves as potential franchisors that will have the capacity to initiate water services franchising partnerships proposals. They will select water services elements and will formulate the business models to go with each. They will then look for sites to apply the models, and will seek the cooperation of the Water Services Authorities (WSAs) or other infrastructure owners. Finally, they will offer the business to potential franchisees, or will attempt to nurture potential franchisees.
Mr Jay Bhagwan, WRC Executive Manager says, “Franchising is a way of accelerating the development of a business, based on tried and tested methodology. The franchise system firstly correlates and systematises the business, and then facilitates the setting up of the business and supports and disciplines it thereafter. The key is the incentive, to franchisor and franchisee alike, to improve efficiency, and to provide improved service reliability and quality control”.
According Mr Ive many South African WSAs do not have staff or systems to deliver a reasonable service. A carefully designed set of WSA/franchisor/franchisee arrangements, efficiently implemented, could assist. At the same time, franchising offers opportunities to the microenterprise sector and to local economic development. Franchisees are microenterprises, but their association with a franchisor gives them considerable advantages – reflected in the better service that they can provide over stand-alone microenterprises.
This franchising model has proven to be worth pursuing when looking at Amanz’ abantu’s franchisor subsidiary (Impilo Yabantu) and its trainee franchisees that has in less than three years, greatly improved the condition of the water and sanitation facilities –and hence the quality of services –at 400 schools of the Butterworth education district.
“This approach could assist local government in solid- waste management; water loss management and household sanitation servicing”, comments Dr Kevin Wall from the CSIR Built Environment. “Some large municipalities have indicated keen interest in franchised service providers. Such providers could undertake water and sanitation services in dense, informal settlement areas and communities living on the rural fringe, as well as solid- waste collection and its recycling and disposal”.
Studies led by the WRC, CSIR and Amanz’ abantu team analysed the water services delivery value chain and identified about 400 types of opportunities for microbusinesses. Social franchising partnerships are thus now ready to expand beyond their current comfort zone of routine servicing of low technology water and sanitation infrastructure in rural areas.
Franchising water services is a way of fast tracking job creation where unemployment is at its highest and work skills are limited while addressing service delivery. This model addresses the transfer of work place skills and directly addresses broad-based black economic empowerment at the same time.
Pilot projects have been made possible through the generous funding support from the Irish Aid for a period of three years on O&M of the water and sanitation facilities at selected schools.
Video Clip: https://www.youtube.com/watch?v=XcScNxy04pw&list=UUjrzVZ6a-jjsCFDcd0Uz_ig
Report TT 432/1/10 Going with the franchise flow: An exploration of franchising partnerships for the operation and maintenance of water services infrastructure. Other reports in this series are available on the WRC web site (www.wrc.org.za) and can freely be downloaded.
Contact: Mr Oliver Ive, Amanz'abantu email:email@example.com or Dr Kevin Wall email: KWall@csir.co.za