Esskom Power Breakdowns Case Study

2117 Words 9 Pages
Executive Summary
This assignment aims at analysing the latest problem facing South Africa: The Eskom power breakdowns. This problem has become continuous over the long run and could lead to a great deal of economic loss for the country. The highlight of the assignment is to critically identify what went wrong in the management of Eskom, identify the possible departments that were responsible for this problem and what were the responses to the power cuts that have been impacting the nation.
Operational risk management plays an important role in companies in the case that it helps foresee possible risks that could negatively impact on a company. Eskom’s Risk managers failed to apply all the necessary steps that are included in managing risks
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Suggested key risk indicators
Activities involved in carrying out Eskom process value for the stakeholders and customers fall under the operations department of Eskom. Key Risk Indicators helps Eskom to identify the risk involved in operational processes of the organization and to strategize accordingly to reduce those risk. Key risk indicators recommended for Eskom is as follows;
• Stressing models could have been implemented to determine the exposure level of Infrastructure maintenance. When the exposure level moves beyond certain restrictions, this can be applied as a risk indicator.
• Staff turnover could have been revisited regularly to minimize the risks of staff shortages, i.e. when the CEO stepped down that left Eskom with shortage of experienced officials at the helm. Staff turnover could have been implemented to determine the exposure level of awarding contracts and fraud within the unit.
• Portfolio models could have been implemented that could determine the rate of completion on ongoing expansionary supply of electricity projects.
• Developing leadership and employees. Investing on safety programmes, were employees would regularly report incidents
• Continuously setting country as a benchmark/and continuously reviewing the industry
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More transmission failure shows a high level of risk.
• Power plant performance as an indicator, not only to give information about the performance of the power plant; it also indicates the means of achieving such performance

Load shedding brought about negative impact at different in South Africa and with it hurting the economy of South Africa more. The negative impact led to less business confidence, reduction in productivity and reduction in exports that will affect the current account of South Africa negative, since because South Africa rely heavily on exports to combat its current account deficit. Eskom said they learned some important lessons from the load shedding. The acting CEO of Eskom Mr Molefe on his press statement on lessons learned from load shedding and they are as follows;
• Integration, so that Eskom share the risks with the government and communication with the public to ensure that they go in the same direction.
• Risk assessment: taking a decision that could have a consequential risk on the next person, and therefore Eskom has to be thorough in applying risk assessment.
• Command centre which overacts the whole programme that will be tightened for Load

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