Job losses as new CEO shakes up BPC
Brian Benza | Tuesday January 24, 2017 18:47
Under its turnaround strategy, dubbed Masa 2020, new CEO Dr Stefan Schwarzfischer says he is effecting a reorganisation of the corporation targeted at cutting up to 30% of the costs while maximising revenue streams.
BPC employs about 2,350 workers across the country.
The shake up will start this week with the advertisement of all executive committee (EXCo) jobs both internally and externally, which would be followed by reorganisation of the middle management level. Among those to be affected the most by the exercise will be staff whose work has been outsourced, those whose working environment has been affected by technology as well as those whose functions and operations have been centralised.
“All the top managers have to reapply for their jobs while for those on lower levels, the screening will be done through a desktop assessment. We expect the first phase, which should affect about 200 people, to be complete in the next 4-5 months. Cleaning and car maintenance services were outsourced two years ago and yet the workers are still employed by BPC. It’s such kind of cleaning up that we need to do,” Schwarzfischer told the media yesterday.
The BPC has been running operational losses for years, which amounted to P2bn in 2015/16, P1.3bn in 2014/15 and P1.6bn in 2013/14.
Although he could not estimate how many workers will be affected in the second phase of the retrenchment exercise, as the ‘reorganisation would be process oriented’, Schwarzfischer said the plan is to complete it in the next 12 months.
On top of re-engineering of processes, Schwarzfischer says they will also accept voluntary separation applications for certain pay grades, while the corporation is also putting in place a programme to encourage affected staff to go into self-employment.
As part of the strategy to cut costs, Schwarzfischer said he is also looking to scale down the works of the Operation and Maintenance (O&M) contractor, STEAG at Morupule B.
Following a fall out between Chinese company, CNEEC and government, STEAG was awarded the O&M contract in 2014 with its main functions including operation of the plant, training of BPC staff and advisory services.
“We are not completely cutting them out as they still have a contract until 2019. We are just scaling down their scope of works. In the few months I have been here, I haven’t seen much commitment from our BPC staff at the plant to learn. It looks like the STEAG employees are doing most of the work.
“Now we have the upcoming sale of the plant and if our BPC staff don’t learn how to run the plant, chances of them being employed by the new buyers would be limited. We can’t terminate the contract but, within the contract, we can reduce the amount of work they do and thus cut costs. So the plan now is to reduce STEAG’s services probably from 100% to 20%,” he said.
Under the Masa 2020 strategy, BPC is transforming itself from a power utility to a power distributor, as Independent Power Producers will be generators of the bulk of the country’s power needs.