Efforts to rally the private sector to come to the aid of struggling cluster development agency the Cape IT Initiative (CITI) have been promising, but not sufficient.
This is according to CITI board member Dave Gale, who says: “CITI is facing a challenging time right now. The running costs of CITI are no longer sustainable on government funding alone.”
Last month, the Initiative distributed an e-mail to members informing them that its current business model is no longer sustainable and it would embark on a restructuring process. “CITI began as an ICT cluster promotion entity, and I think we can safely say it has done a fairly good job of that,” says Gale.
He notes the agency's focus has become blurred of late and a new system is needed to rejuvenate the business. “CITI has become a project delivery mechanism, becoming, to a degree, the engine and not just the oil that enables the engine to run. We've had to review CITI's objectives and mandate, and refocus on being a promotion and facilitation agency again.”
According to Gale, this is why the initiative is refocusing its operations. It will reduce costs as far as possible, protect current revenue streams and continue to pursue private sector funding. CITI hopes this, along with a restructured business model, will help it become a long-term sustainable entity.
While the initiative will need dramatic changes for it to become sustainable, Gale says stakeholders are convinced the restructuring will work. “We believe it can work. If we did not think it would, we wouldn't be doing it. The CITI board is intent on ensuring the organisation continues to deliver value into the future.”
CITI has taken part in Western Cape ICT business development since 1998 and Gale contends the business has created “enormous value” for the area's economy. “Running an NPO [non-profit organisation] is never easy at the best of times. Running an NPO, which represents a very broad and diverse industry, and also acts as a special purpose vehicle for government initiatives, is a difficult job.”
Sustainable future
Last month, the initiative communicated its troubles to members and asked for feedback on possible sustainable ideas to keep the business afloat.
Gale says there have been many supporting statements regarding the value of CITI, but few constructive suggestions on creating a better business model. “The board has approved an interim strategy to provide direction in the short-term, but will be holding some strategic planning sessions within the coming month,” he adds.
The board's first point of call will be to agree on a process for including input by CITI members. “Strategy is essentially an ongoing conversation that needs to be nurtured to be successful,” adds Gale.
He says current projects will be handed over to BandwidthBarn, one of CITI's most successful cluster initiatives. Other initiatives include VeloCITI, Women in IT, Youth in IT and MyMentor. “Recently, CITI has been in discussions with a number of corporates regarding ideas they have for new projects which could be run under the CITI umbrella.”
He says there is no shortage of good ideas; however, “there needs to be a solid, sustainable structure to support turning these ideas into projects”.
The agency's membership includes BulkSMS, Business Data Solutions and Connection Telecom. Last month, CITI launched an interoperability laboratory, with software giant Microsoft, to assist small business developers to grow business opportunities.
Related stories:
W Cape supports broadband roll-out
Cape IT firms must 'wake up'
Cape IT Initiative in trouble?
Share