The existence of the State IT Agency (SITA) has been called into question as it continues to battle to fulfil its mandate amid delayed tender awards, irregular spending, and high staff attrition.
SITA's struggles were revealed in a recent Parliamentary portfolio committee meeting, following the agency's relocation to the Department of Telecommunications and Postal Services.
Parliament's research unit states, in its analysis of SITA's strategic plan, that it has "by and large" failed to achieve the objectives of its 2010 to 2013 turnaround plan. Although its achievements are to be "applauded", the agency "has been rocked by continuous leadership instability at all levels, which include resignation of board members, CEOs and executive levels changing all the time," says the report.
In pain
"Pain" points SITA's latest CEO Freeman Nomvalo detailed include long delivery times, cancelled tenders, poor communications and high prices. These issues were blamed on limited staff capacity, a lack of effective contract management, poorly defined specifications, and limited ability to leverage economies of scale.
SITA outlined several "interventions" - including improving controls, competency and market intelligence - and is again set to transform itself, a process it has previously unsuccessfully embarked upon. Commentators argue the organisation was doomed to fail, and is an unnecessary and expensive middleman in the state's IT procurement system.
The agency notes it has several plans to improve the situation, including a new strategy and revised procurement processes that create a more transparent and proactive system. It also intends to move off manual processes to "ensure a better line of sight for contracts and procurement transactions" as it seeks to deal with what it terms "legacy" issues.
The company is financially stable, and aims to fill 257 posts by the end of the financial year.
Its new strategy is also aiding it in trimming the time it takes to award tenders, and reduce the number of bids that are binned; a figure currently at 50%, it adds.
The agency, meant to act as government's IT procurement arm, is also the subject of at least one Special Investigation Unit probe into every tender it has issued over the past decade. It has also fallen foul of the auditor-general, and failed to curb irregular, fruitless and wasteful expenditure, racking up a total of R45.1 million in its last financial year, although this is an improvement on the previous financial period.
However, it did have highlights during the year, which include connecting around 7 000 public service outlets to a secure state network, handling 740 000 IT helpdesk calls, and processing 562 000 matric certificates. It has also hosted the Presidential Hotline, and was the primary contributor to the government-wide ITC strategy.
No chance
ICT veteran Adrian Schofield says, while it makes sense there is a SITA, it supplies ICT services to parts of government by default, rather than design. "With hindsight, it is easy to say that SITA was doomed to fail. The only chance of success would have come from installing a strong leadership with a clear mandate, overseen by an independent board, removed from political interference."
Instead of continuous strong leaders, SITA has been through 17 CEOs in 15 years, and Nomvalo, appointed last May for a year's tenure, has quietly had his contract extended. "No enterprise, regardless of its shareholding, public or private, could hope to build a new culture of success and maintain a sense of direction with 17 changes of leadership in 15 years," says Schofield.
SITA's failings harm the industry and cause government IT to "creak" and "groan" and "work in places," says Schofield. "There is a lack of cohesion, a lack of direction. ICTs are not used to the best advantage and innovation is stifled. Good projects take too long to be implemented, bad projects fail."
Not needed
Democratic Alliance shadow minister of telecommunications and postal services, Marian Shinn, says SITA is "barely functional and an unnecessary and expensive middleman" in government's procurement process.
She questions how its key challenges after 18 years of existence can be procurement, service delivery and low staff morale. "I thought that the economies of scale in the procurement chain was one of the main reasons for its existence and yet it takes more than a year to complete procurement requests."
The Parliamentary report notes SITA faces dissatisfied customers, high top-level turnover rates and also battles to pay creditors in 30 days, instead making payouts at an average of 70 days. Its supply chain management strategy of dealing with bids in 90 days also translates to 127 days, and only 50% of targets were met in the last financial year, it adds.
"Its sloppy contract and tender management is legend, which adds time and cost to the projects into which it inserts itself," argues Shinn.
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