Transformation Plan for Improved Service Delivery

2. Contents Background 1 2 Challenges What are we doing 3 What has been achieved 4 5 What’s next 6 Questions

3. Background The Compensation Fund is faced with massive untenable challenges and cannot maintain the status quo. Expected Outcome Current Situation • Issue • Expected Outcomes The Turn-around plan will ensure that all key business elements are addressed leading to a transformed Compensation Fund and ultimately improve service delivery.

4. Challenges The CF has undertaken a diagnostic review of its operations and identified key business challenges, requiring immediate focus to ensure successful strategic execution enablement Current Situation: Strategic Priorities Business Challenges • Too many initiatives leading to overloading parts of the organisation • Inadequate business coordination and integration • Poor project and schedule integration • Poor issues and risks management due to insufficient oversight • Poorly aligned definition and achievement of “systems optimisation” • Misalignment with regards to performance management and accountability • Low people engagement throughout the agency • Turn-around fatigue • Inadequate capacity in critical Financial management areas • Negative Audit outcomes Claims Processing and Payments • Improved payment of benefits to the beneficiaries of the Fund Revenue Collection • Improved revenue collection from employers Operational Efficiency • Effective administration of the Fund’s operations Rehabilitation and Integration • Promote rehabilitation, re-integration and return to work of injured and diseased workers

5. Challenges Auditor General Findings People Year Process 2008/09 DISCLAIMER Leadership 2009/10 QUALIFICATION 2010/11 QUALIFICATION 2011/12 QUALIFICATION 2012/13 DISCLAIMER Systems • Auditor General’s Findings • No effective and efficient revenue management function exists as required by PFMA; • The Fund did not take effective and appropriate steps to timeously collect all money due to the Fund; • Unable to determine completeness and accuracy of revenue assessment; • Not all employers correctly assessed and billed; • Unreliable information (missing banking details, lack of controls); • Penalties and Interest not calculated correctly; • Long outstanding debts not collected; and • Current and uncorrected misstatement in the Financials Quality of Data Skills & Competence Financial Management

6. What are we doing Our approach is aimed at achieving the key CF value drivers and desired outcomes What we want to achieve? What are we doing? • Singing from the same hymn sheet • CF Executive Management members display a common understanding of the intent of the Strategy and Operating Model. • Executive Management Alignment; • Review and confirm appropriate governance; and • Agree and communicate individual accountability through Programme Management • Projects aligned to Strategic Intent • Projects that are more focused and aligned to strategic intent and Operating Model. • Plan, prioritise and schedule initiatives and resources to align with the CF Strategic Intent; and • Ensure non strategic or non-value delivering projects are scrapped • Improved Financial Management • Improve Revenue Collection • Ensure proper financial management controls • Clean Audits • Develop clear revenue management strategy; • Develop financial management policies, procedures and standards; • ROE website; • Ensure staff are trained and skilled in the required areas; and • Address Auditor General’s findings including payroll audits • Improved Claims and Beneficiary Management • Reduce Claims processing and payment backlog • Improve turn-around times • Reduce fraud and corruption • Finalise the backlog program; • Review and update business processes; • Implement the new RMA system; • Integration between claims management systems and financial system; • Improve system controls . • Formal journey management • Drive the Operating Model implementation; • Ensure integrated and co-ordinated project; and portfolio management, reporting and reviews. • Develop detailed implementation plan and drive rigorous; execution of change management; and • Promote immediate feedback and acceptance;

7. Governance Structure A formalized governance and program structure has been developed and approved to successfully drive the Transformation programmes. • Key Notes: • The Programme Management Forum considers progress on key projects and also takes decisions on Programme related matters;

8. Rational for new structures? • Improve decision making in the Fund; • Ensure harmonization and alignment of programmes and coordinated planning and implementation; • Promote shared understanding of compensation fund issues, challenges and priorities; • Ensure good governance and accountability through collective leadership and management of programmes; • A platform to share information, communicate decisions, share best practices and experiences as well as to review performance; • Promote collegiality and cooperation within the management echelon and among staff.

9. Initiatives Planned The following Key Initiatives have been identified to unlock value and drive the improvements required. Mar’14 Mar’15 Mar’16 Phase 2 Phase 3 Programme Phase 1 • Governance and Leadership alignment; • Fraud and Corruption Hotline; • Business Continuity Review • Legislation Amendment; • Delegation of Authority framework • Enterprise Document and Records Management Corporate Management • Establish PMO; • Fill critical vacancies; • Implement new Org structure; • Client Survey Recommendations; • Business process re-engineering • Performance management system; • Customer Relationship management strategy; • Policies, procedures and standards Corporate Services • Action plan against AG audits and Scopa recommendations; • Revenue Management Strategy; • Letter of Good Standing • Payroll audits; • Implement data cleansing project; • Policies, procedures and standards • Implement Ecommerce system with auto assessment; • Integrate Ecommerce system to financial system Financial Management (including ICT) • Virtual Office and Smart forms; • ICT Strategy review • ICT Operating model • ICT Refresh; • Implement Channel innovation and CRM system • Decentralisation; • ROE Website; • Claims backlog program; • RMA system pilot; • Unclaimed beneficiary monies program; • Data cleansing on eClaims • Policies, procedures and standards; • Online claims submission portal • Full implementation of RMA system; • RMA system integration to financial system; • Rehabilitation Programme Operations Performance Management, Change Management, and Communication

10. Not Started Progress Dashboard Completed In-progress Behind Schedule – Management intervention required Key Points • Turn-around plan has been developed and currently being finalised with management and Exco; • Governance structures completed and signed off; • Commissioner is Project Sponsor, with CFO is Project Director; • Programme Managers and Responsibility Managers appointed to promote accountability in terms of PFMA; • Audit of all initiatives and progress is currently underway; • Process to establish well capacitated PMO underway; • Finance policies and procedures are being established in line with PFMA and AG recommendations; • Adverts and shortlisting of new Director posts underway; • Action plan against AG audits has been completed and approved by Exco; • ROE website has been completed, is operational and enhancements underway; • New improved Letter of Good standing in pilot phase to be rolled out in November 2013; • Claims backlog program is on-going

11. Next Steps • Enhancement of Turn-around plan and follow on approval by Board and Executive Authority; • Communication and socialisation of Turn-around plan; • Outputs linked to manager’s KPIs; • Effectively manage risk and consequences; • Work the Plan

12. Questions