MAGAZINE FOR THE EMPLOYEES OF THE ALTRON GROUP ISSUE 1/2015

Altron turns 50It's a celebration as we take a walk down memory lane

NEWS IN BRIEF

A declining order book and internal difficulties prompted Powertech Transformers (PTT) to consolidate its distribution transformer division. The process, which started in September last year, culminated in the closing of the distribution transformer factory in Booysens, Johannesburg, at

the end of December 2014. As of January 2015, PTT

therefore comprises of two transformer factories, namely Power in Pretoria and Distribution in Cape Town. The transformers previously built in Booysens have been reallocated as follows:• Pretoria West – large

distribution transformers:

5MVA, 66kV and above.• Cape Town – small and

medium distribution transformers: up to 5MVA, 33kV and NECRTs.

Some Booysens employees were absorbed at the Power and Distribution operations, but sadly others had to be retrenched.

“Closing Booysens was

definitely one of the most difficult projects I ever had to do,” says Bernard Meyer, CEO of PTT. “We thank the Booysens employees for their years of dedicated service and commitment, as well as for their exemplary behaviour during the Section 189A process. We wish them well on their way forward.”

On 1 March 2015, Martha Lamola joined Aberdare Cables as executive director: finance.

Booysens closes its doors

Senior appointments at Aberdare

Mishack Matla has been appointed sales, marketing and distribution director at Aberdare Cables.

Altron TMT has received the 2015 Frost & Sullivan Competitive Strategy Innovation and Leadership Award in Converged Services for the ICT Industry, sub-Saharan Africa. The award recognises organisations that have established, through innovation and excellence, a successfully differentiated position in global markets.

Founded in 1961, Frost & Sullivan (F&S) is the world leader in growth consulting, technology research, market research, mega trends, economic research, best practices, competitive intelligence and corporate strategy. Its global team of analysts and consultants continuously research various markets across multiple sectors and geographies.

F&S’s research report into Altron TMT highlights the fact that providing additional value to customers by combining services located in previously separate business is highly challenging, but that Altron TMT has successfully achieved this.

The global team of analysts and researchers who mapped Altron TMT’s competitive strategy against that of several leading competitors was extremely impressed by the company’s performance given challenging industry operating conditions.

The Bytes Document Solutions Green Team initiated the XGS Environmental Award in 2011 to identify and reward best practices such as waste reduction and responsible paper use.

The brainchild of Eddy Gordon, manager for Digital Solutions and MEA training at BDS, the competition is part of a broader environmental awareness campaign. It involves most of the XGS print rooms in

Johannesburg and Pretoria.The winning site

is chosen for its neatness, environmental awareness, recycling, safety and commitment to sustainability. In 2014, the XGS site team at the Standard Bank site best fulfilled all these requirements.

Mukesh Singh, team leader within the Standard Bank Xerox Digital Printing Services division, accepted the award on behalf of his

team at a ceremony that was held at the Standard Bank site in downtown Johannesburg.

According to Eddy, BDS’ Go Green drive wants to achieve two main aims in a fun and engaging way. “We want to make both our employees and our clients more aware of how to run an environmentally-friendly business and we want to help reduce the impact on our world by containing our carbon footprints.”

Strategy award for Altron TMT

Standard Bank wins BDS Environmental Award

The Technology Top 100 (TT100) Awards is an annual event hosted by the Da Vinci Institute for the Management of Technology and Innovation under the auspices of the Department of Science and Technology. Launched in 1991 by the then South African Engineering Association, the awards are regarded as South Africa’s premier business excellence awards and a celebration of local innovation.

It was therefore fitting that one of the most innovative companies in the Altron group received two awards at the 2015 event that took place in

February. Altech Multimedia received the HP Award for Excellence in the Management of Innovation for the design, development and commercialisation of the end-to-end Altech Node Eco System.

The company also won the Da Vinci Award for Excellence in Management of Systems.

In addition, Altron won the South African Academy of Engineering Award for Excellence in the Management of Research, and Altron TMT went home with the Resolution Circle Award for Excellence in Strategy.

Altron TMT shines at TT100 Awards

Francois Stols and Michelle Atkinson pose with the awards Altech Multimedia won at the 2015 TT100 Awards.

The TT100 Awards trophies won by Altron and Altron TMT.

Dr Willie Oosthuysen, South Africa’s 2015 corporate entrepreneur.

Altron executive launches his wedding guide

Grant Rogerson, group executive: corporate relations and co-editor of Profile, recently launched his book, The Truly Inspiring South African Wedding Guide, at Exclusive Books. Email Grant at grogerson@altron.com to obtain the book at the discount price of R160 per copy for Altron staff.

Dr Willie Oosthuysen, Altron group executive: strategy and technology, was named South Africa’s Innocentrix Innolive 2015 Corporate Entrepreneur at an event held in Pretoria towards the end of February. He was recognised for showing how

innovation and collaboration can be achieved sustainably in a very large organisation.

At the same event, Altron was ranked in the top five of the Innocentrix Innovation League division where companies were judged on organisation and collaboration; people and culture; and leadership and ambition, among others.

Innovation award for Altron CSO

BUSINESS PROFILE 32 BUSINESS PROFILE

• Bill Venter, a 31-year-old telecoms engineer, and three colleagues, establishes Allied Electric in Boksburg on 1 April 1965. The total staff complement is only six people.

• Allied Electric begins business as a designer and manufacturer of semi-conductor rectifier equipment, battery chargers, inverters, variable speed drives, DC motor controls, DC power supplies, electronic signal equipment and transformers. Electronic components are distributed on behalf of leading French, USA and UK principals and manufacturers.

• The board creates Ventron Corporation, a holding company to control Altron, Altech, Powertech and Fintech.

• Powertech acquires 90% of Lascon Lighting Industries and ASEA Electric, which consists of a transformer and cables division.

• Anglo American Corporation buys a 20% shareholding in the Ventron Group.

• Powertech buys a controlling interest in Aberdare Cables and merges Scottish Cables and ASEA to form Aberdare – South Africa’s largest cable company.

• 12 625 employees, revenues of more than R7 billion, market capitalisation R1,9 billion.

• Powertech acquires Cables de Comunicaciones SL in Spain.

• PQ Africa’s QEDI and Bytes’ MediSwitch merge to form Digital Healthcare Solutions.

• Usko is rebranded as the Bytes Technology Group Limited (Bytes).

• Bytes buys the IT interests of Fintech to consolidate Altron’s IT interests under Bytes.

• The Altron chairman and chief executive positions are split. Robbie Venter is appointed chief executive of Altron; Dr Venter retains the chairmanship. The Altron Executive Committee is formed.

• Altech Card Solutions (ACS) acquires Cardtronics.

• Powertech sells its Gentech household appliance business to Whirlpool (USA).

• Autopage secures a licence to act as a GSM cellular service provider to both MTN and Vodacom and becomes Altech Autopage Cellular.

• The Bill Venter Foundation rebuilds the Qunu and Nkalane secondary schools in Umtata for the former President Nelson Mandela.

1965 – 2015: 50 years of Altron highlights

1965 2000-20011981-1985 2002-20031995-1996• A new holding company,

Allied Electronics Corporation (Altron), is created with Altech as its telecommunications subsidiary and Powertech as its power electronics subsidiary.

• Altron has 3 700 employees and annual revenues of R89 million.

• Powertech acquires the Willard Battery Group and becomes South Africa’s largest automotive/industrial battery manufacturer.

• Powertech acquires Litemaster and Crabtree Electric.

1979-1980• Powertech and Fintech

are delisted and become wholly-owned subsidiaries of Altron.

• A third rural school built by the Bill Venter Foundation is opened by former President Mandela in Elliotdale, in the Eastern Cape.

• Powertech sells its 30% shareholding in Voltex Distribution to Bidvest for R130 million.

• Altech sells its 40% stake in Alcatel Altech Telecoms for R335 million.

2002• Aberdare Cables

plays a key role in the electrification of South Africa through innovative product design for Eskom.

• A 50% joint venture is formed with Alcatel France in STC, Altech’s telecommunications subsidiary.

• 14 400 employees, market capitalisation of R1,3 billion and annual revenues exceeding R3,2 billion.

• Xerox USA re-enters South Africa in a joint venture with Altron.

• Aberdare Cables acquires Delta Cables and Alcobre in Portugal.

1991-1994• Bytes buys CS Holdings

and 50% of Xerox SA from Xerox International. With its 100% ownership, Xerox SA is rebranded Bytes Document Solutions.

• Altech acquires NamITech and introduces Pamodzi as BEE shareholder in Altech Data and NamITech.

2004• Powertech acquires

Battery Technologies.• UEC Technologies

develops world-leading digital decoder technology.

• Altech enters the smart card field through Altech Smart Card Technologies

1999-20008. Telephone switchboard technology being tested at the STC facility in Boksburg in the early 1980s.

9. Bill Venter with Hugh Caroline and Chris Lourens in the Allied Electric boardroom in the early 1970s.

10. Aberdare Cables came into the Altron fold in 1985.

11. Craig Venter joined Altron in 1988.

12. Dr Venter with former president Nelson Mandela with whom he enjoyed a close business and personal relationship.

13. Subsidiaries such as Altech Card Solutions and Altech NuPay have developed innovative payment solutions over the years.

4. Silicon rectifier sets being manufactured at Allied Electric in the mid-1960s.

5. Variable speed drives being assembled at Allied Electric in 1967.

6. Dr Venter and his two sons made the cover of the Financial Mail when Robbie succeeded Dr Venter as chief executive in 2001.

1. One of Allied Electric’s first major contracts was to supply corrosion protecting coating for the Johannesburg/Durban oil pipeline to the South African Railways in 1968. 2. The first edition of the Altech News magazine, which became Profile later on, was published in 1978. 3. The Allied Electric building at 222 Van Dyk Road, Boksburg East, in the early 1970s.

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7. A young Bill Venter in his office at Allied Electric during the early 1970s.

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A group as diverse and dynamic as Altron needs a finely tuned combination of pragmatism and visionary creativity to guide its strategy. This is the task of the Strategy and Technology Office.

Where to go; how to get there

The strategy and technology portfolios overseen by Dr Willie Oosthuysen reach both far across and deep into the

companies in the Altron group. “The four full-time members of my team work closely with a large number of role players in the group to ensure we have both the microscopic and the helicopter views we need to add strategic value to the group,” says Willie.

Although distinguishing strategy and technology makes it easier to explain the functioning of Willie’s department, the two areas overlap given that technology is integral to Altron’s business strategy.

The strategy taskThe strategy section coordinates large strategic projects on behalf of Altron, in close cooperation with the business leaders. The one that currently takes up most of Willie’s time is the execution of Project TITAN. “Altron spent R1,8 billion to buy out Altech’s minority shareholders,” says Willie. “Through supporting the business leaders, Craig Venter and I oversee and make sure that this investment yields the expected results, according to the agreed plan.”

The two sides of the benefits realisation coin are cost synergies through savings, mainly in the form of shared services, and growing revenues through guiding the cross-and-upsell initiative. The latter entails selling new products to existing customers and existing products into new markets, and developing new products. It also includes the drive to change Altron TMT’s orientation from technology-centered to customer-centered.

Andrew Holden, Altron TMT shared services executive, and Tim Ellis, Altron TMT group executive: business development, support Willie in driving the two EBITDA-contributing workstreams of Project TITAN. The Altron TMT exco does the governance of this project.

The project integration work streams all report on their progress using the dashboard that was developed with the help of McKinsey during the planning of Project TITAN. This feedback is validated and consolidated by Arno Geldenhuys and Tyler Muller. Arno and Tyler also identify new savings ideas and provide financial support to Andrew Holden.

In terms of the bigger Altron, the strategy team coordinates strategic planning sessions across the group. It ensures that both bottom-up (outputs from operations’ strategy planning sessions) and top-down (Bytes, Altech and Powertech strategy planning outputs) strategies are documented and consolidated into an overall Altron strategy that is presented to the board once a year.

In 2014, all the group companies and their operations used the same strategy template for the first time in Altron’s history.

Having obtained board approval for the Altron strategy, it has to be communicated to Altron’s stakeholders. “In this regard we work closely with Michelle Doyle’s Altron Communication Shared Services (ACSS) team,” says Willie.

The Programme Management Office – in the person of Lynda Odendaal – coordinates strategic projects across the group, such as Altech Node and shared services implementation outside Project TITAN. Lynda’s role includes risk management, coordination of project steering committees and some governance.

Developing, protecting and commercialising Altron’s intellectual property rights (IPR) is a critical responsibility carried out by Michelle Atkinson.

She also looks after the IPR aspects of Altron’s partnerships with original equipment manufacturers (OEMs). “We look for new partnerships, maintain our existing ones and investigate ways to adapt them in line with our strategic

objectives,” explains Willie.The market and competitive

analysis function, done by Marilet Branders, is still being developed. Once fully operational, this section will conduct and study market research and share its findings with the businesses, and do comparative and macroeconomic analyses.

Shani Ward, Willie’s personal assistant, supports his busy diary and ensures the smooth running of the office.

The technology taskOn the technology side, Willem Rossouw supports Willie in the Innovation Management section. Together with the chief technology officers (CTOs) of the different businesses, Willie and Willem conduct technology reviews to make sure that Altron’s technology remains relevant, that R&D budgets are spent correctly and that product development timelines are met. They also keep their eyes open for any new IP that should be passed on to Michelle Atkinson for institutionalisation.

Willem furthermore drives innovation into the operations by working closely with the technical and exco teams. Willie explains that Altron has value businesses – where the group owns most of the IP involved, such as Altech Netstar, Altech UEC, Bytes Universal Systems and Powertech System Integrators – and volume businesses, such as Altech Autopage and Bytes Document Solutions. The latter leverage their offerings through their OEM or operator relationships but have little influence on or investment in IPR development. “We oversee both volume and value businesses, but with different approaches to each,” says Willie.

This ability to appreciate operational differences while keeping the desired end state for the group in mind, is what makes Willie and his team such valuable assets to Altron.

The Group Strategy and Technology team members are Lynda Odendaal, Willem Rossouw, Michelle Atkinson, Shani Ward (PA to Willie Oosthuysen), Dr Willie Oosthuysen, Tim Ellis, Marilet Branders, Tyler Muller and Andrew Holden.

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iming is everything in my job,” says Douglas Ramaphosa, the man tasked with building

relationships with Altron’s stakeholders. “And diplomacy, of course. You have to know what to say when and keep smiling when appointments are cancelled at the last minute or when you are called to meet a government minister or politician at odd hours. You also have to know how to say ‘no’ in a diplomatic way to some of the requests they make.”

In September 2014, Douglas took up the position as group executive: corporate affairs – the job he was originally appointed to do in 2006. However, shortly after joining the group at that time, chief executive Robbie Venter and the late David Redshaw, asked Douglas to head up Bytes Specialised Solutions. Absa was the operation’s biggest customer and the 10 years that Douglas had spent in the bank’s corporate affairs area a few years previously, proved helpful in taking the business forward.

With the retirement of David Redshaw and the subsequent restructuring of the Bytes Group in 2010, Douglas moved to Bytes Healthcare Solutions as CEO and

“T

In simple terms, Altron’s group executive: corporate affairs makes friends for a living. Except, of course, it’s not that simple.

Altron’s diplomatchairman of the board. The latter is a position he still holds. “I am very proud to be still playing a part at BHS. Here is a company that is one of the star performers in the Altron Group and year after year they post excellent results. Well done to the executive team and all the employees of BHS.”

Then, in mid-2014, Robbie phoned. “Over a cup of coffee he asked me to consider taking up this position. In typical Robbie’s style, it was a gentle nudge and not an instruction,” remembers Douglas. “’You know the group well, people know you and you have good relationships with business and government,’ was Robbie’s argument. I discussed the offer with my wife Sandy, who had worked for Altron previously, and in September I returned to Parktown.”

Familiar, but not the sameDouglas does not feel that he is walking in his own footsteps. Back in 2006, Altron was just starting to establish relationships with government, regulatory bodies and communities.

Today, the company’s relationships with stakeholders are healthy, proven by the numerous invitations Robbie receives to attend business and government meetings. The invitations

are so numerous that it is impossible for Robbie to attend all these external meetings and Douglas often has to attend some of them on his behalf to represent Altron.

“My focus now is not so much on getting Altron a seat at the right tables, but to make sure that our relationships are mutually beneficial in a business, political, social and developmental sense,” says Douglas.

A case in point is that since returning to the corporate affairs role, Douglas’ main preoccupation has been Eskom, Powertech’s biggest customer. “We’ve been meeting with Eskom officials to understand the utility’s circumstances and to make sure that they understand our situation and what we can offer. Powertech Transformers’ Pretoria West factory, for instance, is the only facility in the southern hemisphere that can manufacture 500MVA and 800MVA transformers.” Powertech Transformers is strategically placed, given its technology and expertise, to play a major role in the country’s National Development Plan, which Altron fully supports.

This type of engagement is also important in view of government’s localisation drive and designated products programme.

Douglas Ramaphosa, Altron’s group executive: corporate affairs. Despite the challenges we are facing on many fronts, I look forward every day to

waking up and adding my two cents’ worth in growing this nearly 50-year-old company.

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