In a bid to cut costs, South Africa’s power utility, Eskom, could extend its strategy of trimming top executive positions to include lower ranking managers and general workers.
A source revealed to Bloomberg that at least 10,000 people on Eskom’s payroll of 48,600 could lose their jobs.
According to a 2016 World Bank study, South African utilities pay workers more than double the norm in 35 other countries on the continent. Additionally, the study indicated that Eskom was potentially 66% overstaffed. Read more: Public Enterprises minister denies leave for Eskom executives
The recent development of trimming top executive positions at Eskom follows an announcement made last month by the Group Chief Executive, Phakamani Hadebe, regarding combining roles at top management.
“This was not an easy process, and I appreciate the patience and support of all those involved as we worked to conclude matters as efficiently as possible,” said Hadebe at the time of the announcement.
He added: “We have managed to reduce the number of F-Band positions from a total of 21 to 9 by way of regrading or combining roles. The new structure, along with our strategy sets us on a path towards stability, and with an executive team that is refocused on improving operational efficiencies and reducing costs to improve profitability and drive the economy forward.”
Eskom’s new structure
The Group Executives for the Generation, Distribution, Transmission and Group Capital now reflect full accountability for Profit and Loss (P&L) within each of the core businesses, which is a key strategic imperative to drive Eskom’s return to profitability.
The new structure has reduced the number of direct reports for the Group Chief Executive to 10 in the short-term, which will reduce to eight when IT and Procurement are relinked back to the Chief Financial Officer (CFO) in the foreseeable future.
In addition, all senior general manager roles, which were a person to holder roles, have been eliminated.
These 10 direct reports comprising Operations, Finance & Services, Human Resources, Legal & Compliance, Corporate Strategy & Support, Audit & Forensic, Corporate Affairs, Group Company Secretariat, IT and Procurement will report directly to the Group Chief Executive.
Distribution, Group Capital, Transmission, Risk & Sustainability, Eskom Enterprises & ERI, and Africa Strategy will report to the Chief Operations Officer (COO).