Bernadette Deka-Zulu (PhD Researcher-Public Enterprise)
FOLLOWING a ministerial statement in parliament, it was announced that load shedding, within load management by Zesco, was expected to start on December 15, 2022.
“Zesco will implement a load management regime aimed at rationing power generation at the Kariba Complex to avoid a complete shutdown. This will be done with the view to minimise the impact on key economic sectors as well as preservation of the integrity of generation units at the Kariba Complex.
We anticipate that based on the water levels, this will translate into a load management regime starting on December 15, 2022 of up to a maximum of six hours daily until the water levels improve,” The Minister of Energy, Mr Peter Kapala said.
This statement was followed by mixed reactions from the Zambian population; some said this statement followed a decision to export power to neighbouring countries at the expense of the Zambian clients.
It is this sort of statement that has sparked debates, as there seems to be a similar pattern from one government in power to another.
Government agencies especially need to improve their operations and reduce processes, costs, and cycle times while increasing service quality, client satisfaction, and staff happiness.
The need for improvement can be done through the use of business process reengineering (BPR) although its execution can be identified as the biggest problem.
This article discusses the process of reengineering electricity production and distribution in Zambia to attain greater efficiency, customer satisfaction, and continuous improvement.
This area of focus looks at the concept of process reengineering in the distribution of electricity and its role in improving productivity, customer service delivery, and reducing costs.
History of Zesco
Zesco Limited is a state-owned power utility company and one of the largest in Africa. It is wholly owned by the Zambian government through the Industrial Development Corporation (IDC).
It was established in 1973 and is responsible for generating, transmitting, and distributing electricity in Zambia. Zesco is the largest power producer in the country with a generation capacity of 2, 800 MW.
It has a transmission network of over 56, 103 km. Zesco serves a customer base of close to a million.
Zesco’s generation mix is dominated by hydropower with 99 percent of its capacity coming from hydroelectric power plants which are highly vulnerable to climate change. The utility has close to 10 hydroelectric power stations with a total capacity of 2, 653 MW.
In recent years, Zesco has been investing in expanding its generation capacity. In 2013, the utility firm completed the expansion of the Kenneth Kaunda hydropower station which added 150 MW to its generation capacity.
In 2015, Zesco commissioned the Itezhi-Tezhi hydroelectric power station which has a generation capacity of 120 MW. In 2018, Zesco completed the expansion of the Kariba North Bank hydropower station adding 300 MW to its generation capacity.
And In 2019, Zesco started construction of the Nkula A hydropower station which is expected to add about 35 MW to the 135 MW of power.
Challenges faced by Zesco
Due to the current poor state of Zambian electricity supply, Zesco has been facing challenges in its overall success.
Since its establishment, Zesco has faced several challenges, including financial difficulties, power shortages, and system failures. However, the company has continued to expand its operations and now serves more than 1.5 million customers across the country.
The enterprise has been instrumental in the development of the Zambian economy and has contributed to the country’s social and infrastructure development.
However, the company faces many challenges, which include:
- Financial difficulties: Zesco has been facing financial difficulties in recent years due to declining revenues and increasing debts. The company has been unable to invest in new generation capacity, leading to power shortages and load shedding.
- Power shortages: Zambia has been facing power shortages due to a lack of investment in new generation capacity. Zesco has been unable to meet the growing electricity demand, resulting in load shedding and power rationing.
- System failures: Zesco’s infrastructure has been plagued by system failures, leading to power outages and disruptions in supply. The company has been unable to invest in new technology and upgrades, resulting in a decline in service quality.
- Political interference: In the early 1990s, Zesco was privatised, but the Zambian government retained a majority stake. This allowed the government to continue to interfere in the company’s affairs.
In the late 1990s and early 2000s, the government began to exert more control over Zesco, culminating in the appointment of a government-aligned board of directors in 2001.
This led to a period of political interference and mismanagement that culminated in Zesco tized. However, the Zambian government has so far resisted these calls, arguing that Zesco is a strategic asset and that privatisation would not be in the best interests of Zambians people.
The issue of political interference in Zesco has come to the fore again in recent years, as the government has sought to exert control over utility operations.
Since the government has continued to interfere in the company’s affairs, leading to many challenges. These include a lack of investment, which has led to a deterioration in the quality of service, and a lack of transparency and accountability.
- Maladministration: During the period of government control, ill practices such as corruption became rampant within Zesco. The problems of government interference in political appointments of board members have a negative effects in performance, e.g office bearers using their positions to award contracts to business friends or family members.
This has led to a decline in the quality of service provided by not only Zesco but many other Stater Owned Enterprises, and for the case of Zesco thereby increasing the overall cost of electricity.
In recent years, there have been some efforts to reform Zesco and root out corruption. However, these efforts have so far been unsuccessful, and Zesco remains plagued by corruption. This has led to a decline in public confidence in the company and has made it difficult for Zesco to attract the investment it needs to improve its services.
To improve efficiency and performance, Zesco embarked on a few business process reengineering (BPR) initiatives. The aim was to streamline operations, reduce costs and improve customer service.
For example, a new customer database has been introduced to manage customer accounts more effectively. In addition, a new complaint management system has been put in place to better track and resolve customer queries.
Despite these improvements, Zesco faces significant challenges in terms of power generation. The company’s hydropower plants are struggling to meet demand due to low water levels in lake Kariba, while its solar and thermal power plants are often unavailable due to technical problems. This led to regular outages and load-shedding across the country.
As much as Zesco is working on several initiatives to improve its power generation capacity, continued corruption and political interference will prolong the results leading to higher electricity prices, which is putting a strain on households and businesses.
As observed, Zesco faces significant challenges in terms of power generation. The company’s hydropower plants are struggling to meet demand due to low water levels in Lake Kariba, while its solar and thermal power plants are often unavailable due to technical problems. This has led to regular power outages and load-shedding across Zambia.
Business Process Reengineering Recommendations
Business Process Reengineering is defined as ‘…a systematic process for improving an existing manufacturing or service operation, or developing a new one, by analyzing and redesigning it to achieve cost savings, productivity improvements, or enhanced customer value.’
After conducting a business process reengineering study for Zesco, based on our study of Zesco ‘s current business processes, we recommend several areas for improvement and reengineering adding to the already progressive and in-motion initiatives.
Listed here are some of the plain recommendations that can be considered to improve their overall efficiency and productivity:
- I recommend that Zesco adopt a more centralized structure. Currently, their organisation is quite decentralised and this results in a lot of duplication of effort and confusion over who is responsible for what. By centralising their operations, they will be able to better control their processes and avoid duplication of effort.
- Investment in modern technology. Their current technology is quite outdated and this results in a lot of wasted time and resources. By investing in more modern technology, they will be able to automate many of their processes and improve their overall efficiency.
- Investments in Solar and other forms of energy. More money needs to be invested into other forms of energy to reduce the strain on hydropower. (Solar, Thermal, gas, etc.)
- Zesco should streamline its customer service processes, including online bill payments and inquiries.
- Internal communication and coordination, especially between the sales, marketing, and customer service departments.
- A review and revision of the pricing structure should be done to better align with its costs and market demand.
- Zesco should improve its inventory management and forecasting, to avoid stock-outs and ensure smooth operations.
