Clarification Briefing

1
Clarification Briefing

• Appointment of Communications Agencies
• 23 January 2007

2
Agenda

• Eskom
• Corporate Profile
• Eskom Account
• Communication Profile
• Agency Portfolios
• Expectations and Requirements
• Tender Process
• Process
• Timing
• Engagement Rules
• Evaluation Criteria
• Black Economic Empowerment
• Evaluation
• Questions

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Corporate Profile

• South Africas national electricity supplier.
• Generates 95 of the electricity used in SA.
• Core business
• Generation
• Transmission
• Distribution
• Main markets
• SA
• Parts of Africa connected to the SA electricity
  grid

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Corporate Profile

• Is financed from reserves, net financial market
  liabilities and assets.
• Internationally, amongst the lowest cost
  electricity providers.
• Services a large and diverse customer base
• Residential 3,6 million
• Commercial 44 000
• Industrial 3 000
• Agricultural 81 000
• Municipal 750
• International 10

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Corporate Profile

• Power lines
• 347 204 km
• Coal burnt
• 136,4 Mt
• Revenue
• R41 387m
• Total assets
• R104 994 million
• Employees
• 29 845

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Corporate Profile

• Achievements
• South Africas most admired brand.
• Best Service Provider.
• 10th Best Company to work for in South Africa.
• Best Leadership Development programme.
• Best Global Electricity Utility.

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Strategic Direction
Vision Together, building the powerbase for
sustainable growth and development.
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Strategic Direction

• Strategic Priorities
• Capacity expansion (Build Programme)
• Quality and continuity of supply (Reliability
  Programme)
• Energised and Focused Resources (Switched On!
  Programme)
• Values
• Integrity
• Customer Satisfaction
• Innovation
• Excellence

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The Eskom Account

• Large, complex and multi-faceted.
• 15 Communications teams commissioning work.
• Up to 16 different campaigns at a time.
• New Group Communications team.
• Recently adopted, non-traditional structure.
• Mix of campaigns brand and retail-like
• Complex billing, invoicing and revenue
  collection.

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Communication Campaigns
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Communication Campaigns
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Communication Structure

• Recently re-engineered to support new business
  drivers.
• High profile, reporting directly to CE.
• Supports Corporate and Line functions.
• Non-traditional structure
• 3 Centres of Excellence
• Matrix
• Projects

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Non Traditional Structure
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Agency Portfolios

• Creative Agency
• Public Relations Agency
• Media Agency

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Creative Agency

• Conceptualization, development, implementation
  and measurement of
• Communication Strategy
• Advertising
• Promotions
• Digital
• Direct
• CRM
• Estimated Value, R30 million per year (billings)

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PR Agency

• Conceptualization, development, implementation
  and measurement of
• Communication Strategy
• Media Relations
• Positioning Papers
• Stakeholder Management
• Issues Management
• Investor Relations
• Internal Communications
• Event Management
• Estimated Value, R60 million per year (billings)

17
Media Agency

• Development, implementation and measurement of
• Media Strategy
• Media Planning
• Media Buying
• Media Trend Research and Analysis
• Estimated Value R90 million per year (billings)

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Eskom Requirements

• Strategic partner with strong analytical
  strategic skills.
• Thought leadership and global insights.
• Fresh creative approach - beyond TV, print and
  radio.
• Excellent understanding of new and alternative
  media.

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Eskom Requirements

• Proactive.
• Understanding and Patient.
• Big Brand Development combined with Actionable
  Campaigns.
• Ability to interact with Eskom Executive
  Management and Senior Government Officials and
  other stakeholders.
• Flexible.

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Eskom Requirements

• Ability to service a multi-faceted account
• Multiple communications teams and interfaces
• Numerous independent campaigns and cost centres
• Complexly structured organisation
• Impeccable customer service.
• Sound financial discipline.
• Integration and collaboration with other
  agencies.
• Automated systems and processes.

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Tender Process
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General Information

• Number of appointments
• Intention is to appoint one agency per portfolio
  but Eskom may combine portfolios and appoint only
  one agency
• Agencies may submit a response for one or more of
  the portfolios
• A separate submission per portfolio is required
• Duration of contract
• 3 years linked to bi-annual performance reviews
• Pitch Fees
• Will not be paid

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General Information

• Consortiums and Associations
• Will be considered
• Must be in place at the time of the submission
• Provide required information for each of the
  members
• Demonstrate how it will operate and function
• Correspondence
• Only via e-mail
• Shared with all
• Pitch Presentations (only short-listed agencies)
• Combination of credentials, strategy and creative
• Brief and Scorecards will be provided in advance

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RFI Submission

• Information required
• Agency Declarations
• Conflict of interest
• Contract conditions (PSC)
• Tender conditions
• SARS certificate
• Shareholding and Directors
• BEE evaluation
• Audited financial statements 2 years

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RFI Submission

• Information required (cont)
• Credentials
• Company and contact details
• Profile (age, billings, number of staff, global
  footprint, awards)
• Services in-house and outsourced
• Clients
• Experience and expertise
• Culture
• References
• Case study

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Short Listing

• A maximum of four agencies per portfolio.
• Two sets of criteria
• A Critical Criteria
• Adherence to tender requirements (RFI
  Information)
• Valid Tax Certificate
• Audited financial statements
• BEE rating
• Financial stability

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Short Listing (cont)

• B Short Listing Criteria
• Global Footprint Weight 15
• Global and Africa
• Relevant Experience Weight 15
• Corporate, Service, Complex
• Agency Profile Weight 20
• Age, billings, resources, clients
• Service Offering Weight 30
• Full, in-house
• Suitability (case study) Weight 20
• Compatibility, insights, professionalism

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BEE Evaluation

• Black means South African citizens who are
  Black, Indian or Coloured persons and EXCLUDES
  individuals belonging to such communities from
  any other country.

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BEE Evaluation

• Black Women-owned Enterprises (BWO)
• At least 50 of the voting shares or interests
  are held and controlled by Black Women
• Black Women have contributed at least 50 of the
  required capital
• Black Women in the enterprise have not been given
  voting shares or interest just to capture or
  retain contracts
• Black Women participate in the day to day
  management and decision making of the enterprise
• In a joint venture, skill must be transferable to
  the Black Women entrepreneur, which means that
  the Black Women entrepreneur must have the
  required educational level and/or aptitude.
• Enterprises with sales or turnover of less than
  R25 million a year.

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BEE Evaluation

• Small, Medium and Micro Enterprise (SMME)
• As above, but with ownership held by Black Males

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BEE Evaluation
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BEE Evaluation

• In order to qualify as a BEE Supplier, a Large
  Supplier must score at least one point each on
  Black ownership, Black management, Black
  skilled personnel and purchasing from BEE
  suppliers.
• When a Large Supplier earns 9 or more points, it
  is considered a Black or Black Empowering
  Supplier.
• In the case of "Other BEE Initiatives", Eskoms
  Supplier Manager will decide whether an
  additional point should be allocated or not.

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BEE Evaluation

• In order to qualify for a point for employment of
  the disabled, suppliers who employ fewer than 50
  employees must employ at least one disabled
  person.
• Suppliers who employ more than 50 employees must
  employ at least two percent disabled persons (as
  a percentage of their entire labour force) and
  have a policy driving the employment of disabled
  persons in place.

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BEE Evaluation

• Large Black Suppliers (LBS)
• Same as for BEE but with more than 50 Black
  Ownership
• Other Suppliers (OTH)
• No or less than 50 Black shareholding, company
  not meeting the requirements of the table above.

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BEE Evaluation
Based on the criteria, determine and indicate the
category your agency falls into
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Submission

• Format
• 3 hard copies
• 2 soft copies (separate CDs)
• Scan in the information where necessary
• Available
• - www . eskom.co.za/agencies_RFI
• Deadline
• 31 January 2007 at 10h00 in Eskom Tender Box,
  Eskom, MWP, Maxwell Drive, Sunninghill
• No late or incomplete submissions will be accepted

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Pitch Tips

• Understand the process (2-tier)
• Response to RFI
• Mandatory prerequisite for short-listing
• Checklist of all information asked for
• Deadlines are not negotiable
• Dont entrust to junior staff
• Limit irrelevant information
• Dont include dated information e.g. expired
  tax certificate
• Provide an executive summary in tabular format

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• Thank You
• Questions?