Thami Nompula MBA Dissertation March 2007 - Rhodes eResearch ...

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1.2 The Importance of Regulation in the Modern Economy Regulation means government’s direct or indirect control of an enterprise’s activities in a particular sector of the economy (World Bank, 2001). Regulation can be economic, technical and social (World Bank, 2001). Economic regulation is primarily concerned with the price of monopoly elements of energy, the financial conditions of the utilities, their operating and investment decisions and the necessary conditions for competition (Baldwin and Cave, 1999; World Bank, 2001). Technical regulation focuses on the operational and engineering aspects of an enterprise or grid operation such as safety, reliability and quality of supply and customer service. Social regulation is concerned with the health and environmental standards that minimise degradation of the planet (World Bank, 2001). Regulation is therefore necessary to provide protection and support to a diverse range of stakeholders in a given sector. This will enable tariffs to be aligned closer to the cost of supply, create and maintain a climate conducive for investment. These, in turn, promote transparency in the regulatory processes to minimise regulatory risks, protect customers and ensure efficiency in utility operations and industry sustainability. According to Baldwin and Cave (1999) there are six major reasons why regulators are appointed in a given sector of the economy. First, to prevent market failure that ensures that the industry is sustainable. For example, in 2002 the Banks Regulator decided to liquidate Saambou Bank but rescued BOE Bank to ensure confidence in the banking sector. Such interventions help provide investors with a predictable business environment. Secondly, to protect consumers from anti- competitive practices by powerful operators which lead to monopolistic dominance and price distortions (Baldwin and Cave, 1999; World Bank, 2001). Thirdly, regulators overcome information asymmetry problems by, for instance, instructing food manufacturers to provide nutritional information on food products. Fourthly, they sustain and ensure public confidence about service providers such as the role played by the South African National Standards (SANS) in certifying that certain products meet stringent quality standards or the nuclear safety assurance role of the National Nuclear Regulator (NNR). Fifthly, to meet the socio-economic objectives of government such as making telephony and energy accessible and affordable to all citizens. Finally, to promote equal opportunity by regulating the barriers to entry and to exit in certain markets in order to stimulate competition and choice. 2
1.3 The National Energy Regulator The National Energy Regulator of South Africa (NERSA) is a regulatory authority established in terms of the National Energy Regulator Act, 2004 (Act No. 40 of 2004) to regulate the electricity, petroleum pipelines and the piped-gas industries (Republic of South Africa, 2004). NERSA is primarily an economic regulator. The functions of the Regulator are to oversee the activities of: • The Gas Regulator as set out in section 4 of the Gas Act, 2001 (Act 60 of 2001); • The Petroleum Pipelines Regulator as set out in section 4 of the Petroleum Pipelines Regulator Act, 2003 (Act 58 of 2002); and, • The National Electricity Regulator as set out in section 4 of the Electricity Act, 1987 (Act 41 of 2001). NERSA is led by a Board that comprises of nine members. The Chairperson of the Board, the Deputy Chairperson and two others are Part-time Members while the Chief Executive Officer (CEO) and three other Members serve on a full-time basis (Republic of South Africa, 2004). NERSA is supported by a secretariat made up of managers, specialists in the areas of economics, financial analysis, engineering, communications, information management, legal advisory services and support staff. In accordance with these Acts, NERSA is mandated to undertake functions such as the issuing of licences, granting of concessions, administration of the rules, settlement of disputes between stakeholders (especially licensees and customers), monitoring of compliance with regulatory norms, prosecution for non-compliance, including the imposition of penalties, promoting investment and encouraging competition in regulated industries, including reforming and liberalising markets (Republic of South Africa, 2004; World Bank, 2000). 1.4 Context: The Functions of NERSA The generation, production and distribution of energy accounts for approximately R100 billion of South Africa’s Gross Domestic Product (GDP) (National Electricity Regulator, 2005). NERSA is responsible for regulating the electricity supply industry (including Eskom), the vertically integrated electricity utility owned by the National Government and over 200 municipalities that are licensed to distribute electricity (National Energy Regulator, 2006). The electricity industry is 3
Page 1 and 2: AN EXPLORATORY INVESTIGATION OF THE
Page 3 and 4: Declaration I, Thami Ignatius Nompu
Page 5 and 6: Acknowledgements A number of people
Page 7 and 8: 2.2.4 Definition of knowledge work
Page 9 and 10: 3.6.2 Factors that influenced the c
Page 11 and 12: CHAPTER 5: CONCLUSION AND RECOMMEND
Page 13 and 14: Table 4.21 Sense of achievement ana
Page 15 and 16: LIST OF APPENDICES Appendix A: The
Page 17: 1.1 Introduction CHAPTER 1: INTRODU
Page 21 and 22: 1.5 The Importance of Knowledge Wor
Page 23 and 24: continuous success. South Africa, a
Page 25 and 26: 1.6.2 Cost of turnover and opportun
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Page 29 and 30: 2.1 Introduction CHAPTER 2: LITERAT
Page 31 and 32: Knowledge-based organisations rely
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Page 35 and 36: • Knowledge workers tend to work
Page 37 and 38: esent unnecessary supervision; they
Page 39 and 40: equipment, exist and are worth cult
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Page 43 and 44: Although knowledge workers may be a
Page 45 and 46: Guest’s (2001) findings. The Hay
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Page 49 and 50: sustainable objectives both for the
Page 51 and 52: 2.5 The Work Dimension According to
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Page 57 and 58: 2.7.1 Quality of leadership Quality
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2004). Furthermore, because the int
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According to Walonick (2004), one o
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contained section one of the questi
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Wisniewski (2002) describes reliabi
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Of the 34 respondents, there were m
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As indicated in Figure 3.4, of the
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3.8.7 Number of previous years work
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3.8.9 Divisional distribution This
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The Chi test was used to test furth
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generated and these are attached as
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to a leader who believes in their v
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Senge (1990) introduced the concept
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According to the literature once kn
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4.3.1 Job enrichment Seventy six pe
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4.3.3 Control over work assignments
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4.3.5 Challenging work For 70% of t
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and RERA are continental initiative
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Table 4.17: Exchange programmes wit
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either work for two years for NERSA
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4.5.1 Sense of achievement and numb
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and Armstrong and Murlis’ (2004)
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Table 4.25 Freedom to plan and exec
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The next chapter explores in greate
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need to create a favourable environ
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5.3.3 Focus on the individual and g
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5.4.1 Factors Analysis: factors tha
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workers’ need for individualism a
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Branham, L. (2005). Keeping the peo
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Dumas, J. and Redish, J. (1999). A
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Kaye, B. and Jordan-Evans, S. (1999
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National Energy Regulator, (2006).
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Sturgess, J. and Guest, D. (2001).
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November 2006 Dear Colleague APPEND
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SECTION 2: FACTORS THAT INFLUENCE Y
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APPENDIX B: SOURCES OF RETENTION VA
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38 Opportunities for feedback, self
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Table 3: Opportunity to achieve per
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Table 9: Information sharing 127 FR
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Table 14: Scope to balance work and
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Table 20: Scope to create desirable
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Table 26: Job enrichment Table 27:
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Table 31: Adequate remuneration, be
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Table 37: Management that values in
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Table 43: Reputation of the organis
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