Eskom nuclear generation : risk mitigation through quality management development of small suppliers

Abstract

There is a South African Government initiative to use State-owned Enterprises (SOE's) to roll out a programme for the development and stimulation of local small businesses in South Africa. The state has requested SOE's to set targets on a voluntary basis to increase trade with small businesses, with the purpose of developing small enterprises to eventually enhance skills transfer, training and employment. However, when large customers such as Eskom Nuclear Generation require ISO certification as a prerequisite for a supplier to provide goods and/or services to them, most small businesses are unable to comply. The requirement of IS09000 compliance inhibits the ability of most small businesses to compete with their larger counterparts. Small businesses constitute as much as 90% of most world economies. They have many advantages to offer customers, such as a high level of flexibility, innovation and responsiveness to customer needs. These attributes can introduce healthy competition to the supply chain. Small businesses, by their very nature experience more risks, such as a higher vulnerability to volatile market forces and skills loss. In addition, they are generally less specialised.