Breaking the Cycle of Institutional Disarray
In recent high-level policy discussions, a familiar narrative has resurfaced: the idea that the solution to a failing state-owned monopoly-such as our power supply-is the creation of a second state-owned entity to provide competition.
However, as any specialist in governance or audit quality will observe, the “Two or More” strategy in South Africa has a historically poor track record. From transport (Transnet and PRASA) to defense (Armscor and Denel), the pattern is consistent. When the underlying issues are poor management and a lack of accountability, adding another entity to the ledger does not solve the problem-it simply replicates the failure.
1. The “Replication” Risk
In accounting and strategic management, the health of an organization is determined by its culture and systems, not just its mandate. If the culture of an institution is built on non-accountability, creating a “twin” entity will inevitably lead to:
- Budgetary Bloat: Doubling the administrative overhead without doubling the output.
- Fragmented Responsibility: Creating “grey areas” where performance information becomes difficult to track and verify.
- Systemic Disarray: As seen in our water boards and municipal structures, more entities often lead to more complexity, not more clarity.
2. Changing the Narrative through Accountability
The answer to institutional failure isn’t “copy and paste.” The answer is to Change the Narrative.
For boards, audit committees, and public sector leaders, this means moving away from the “Creation” phase and into the “Remediation and Quality” phase. True progress is found in:
- Strengthening Oversight: Ensuring that Audit Quality is a strategic priority, not a box-ticking exercise.
- Functional Governance: Implementing policies and processes that mandate consequence management.
- Performance Clarity: Using accurate performance information to hold leadership accountable to the taxpayers they serve.
Altimax: Your Partner in Structural Reform
At Altimax, we specialize in helping organizations move from “Disarray” to “Strategic Advantage.” Through our Strategic Support and Audit Quality divisions, we act as a strategic mentor to help entities break the cycle of poor management.
We provide the specialist clarity needed to:
- Audit Remediation: Fix the root causes of negative audit outcomes.
- Governance Facilitation: Build robust risk management and ethical frameworks.
- Process Engineering: Develop standard operating procedures (SOPs) that ensure consistency and compliance.
We don’t just help you manage an entity; we help you build a culture of excellence that delivers economic value and peace of mind.
Is your organization replicating past failures or building a future of quality? Book a Strategic Governance Workshop or Request an Audit Quality Review to ensure your entity is built on a foundation of accountability.
