AGRICULTURAL RESEARCH COUNCIL

Strategic Plan2010/11- 2014/15

DR. Shadrack. R. Moephuli

President & CEO

ARC MANDATE PER ACT

To CONDUCT RESEARCH, DEVELOPMENT & TECHNOLOGY TRANSFER IN ORDER TO:• Contribute to better quality of life;• Facilitate/ensure natural resource conservation• Promote agriculture & industry;

ARC TEAM Dr. Mohammed Jeenah (R & D)Ms. Anati Canca (Tech Transfer)Mr. Gabriel Maluleka (CFO)Mr. Michael Netsianda (HR & Support)Ms. Tobey Matlaisane (Communications)Mr. Craig Matthews (Company Secretary)

Enablers & alignment to KRAs • DAFF Agriculture Production Strategy • Comprehensive Rural Development Programme

(CRDP)• National R & D Strategy• Agriculture R & D Strategy• Ten Year Innovation Plan for Science &

Technology• African Agenda – NEPAD

– Consolidated Science & Tech Plan of Action– Comprehensive African Agricultural

PURPOSE OF STRATEGIC REVIEW

• Alignment with Medium Term Strategic Framework (MTSF) Priorities

• Strategic approach to R & D and Technology Transfer

• Alignment of strategic approach with Council mandate

• Alignment with resources• PFMA requirement

SETI Review 2006/07 ARC Update: 2007 to 2010

1.Improve management processes

Organization restructured & new management

2. Strengthen ARC linkages with external sources of knowledge

Conclude and implement collaborations with universities & others

3. Improve quality & relevance of research outputs

Intensify Quality of research, advisory & diagnostic services & publications

4. Focus on transformation Diversify workforce through active recruitments

5. Partnerships – reorientation of R & D agenda for developmental needs of the poor

Partnerships with PDA, SOEs, NGOs, universities etc.

Technology Transfer unit

MANDATE FROM COUNCIL• Growth in agriculture – increased productivity• Growth in exports – innovation (products & processes) • Reduction in rural poverty – productivity improvements• Mitigation of agricultural risks• Business analysis – optimize performance & reduce

duplication• Synergy & collaboration• Ratio of scientists – critical mass & optimum

performance• Improve efficiency• Improve reporting controls

VISION AND MISSION

• VISION:– “Excellence in Agricultural Research and

Development”

• MISSION:– “The ARC is a premier science institution that conducts fundamental and applied research with

partners to generate new knowledge, develop human capital and foster innovation in

agriculture, through technology development and dissemination, and competitive commercialization

of research results, in support of developing a prosperous agricultural sector”

VALUES

• Batho Pele principlesBatho Pele principles• Ons maak ‘n planOns maak ‘n plan• TARGETTARGET

– TruthTruth– AccountabilityAccountability– RespectRespect– GrowthGrowth– ExcellenceExcellence– TrustTrust

Technology Transfer

Generate, develop and apply new knowledge and

technology

Sustainable use and management

of natural resources

Enhance Nutrition, Food Security and

Safety

Enhance the ability of the agricultural sector to manage

and mitigate agricultural risks

Achieve organisational

growth and sustainability

Vision: Excellence in Agricultural

Research and Development

Mission Statement: The Agriculture Research Council is a premier science institution that

conducts fundamental and applied research with partners to generate new knowledge, develop human capital and foster innovation in

agriculture through technology development and dissemination, and competitive commercialisation of research results in support of

developing a prosperous agricultural sector.

ARC Mandate: To conduct research, development and technology transfer in order to:•promote agriculture & industry;

•contribute to a better quality of life•facilitate/ensure natural resource conservation

MINISTER

COUNCIL (BOARD)Vacant

CHIEF EXECUTIVE OFFICER& Accounting Authority (interim)

COMPANY SECRETARY CHIEF RISK OFFICER

CHIEF FINANCIAL OFFICER

MR. MALULEKE

EXEC. DIRHR & SUPPORTMR. NETSIANDA

EXEC. DIR.R & D

Dr. JEENAH

EXEC. DIR.TECH. TRANSFER

MS. CANCA

LANDSCAPE FOR ARC PRIORITIES

Cross-Cutting Issues

Cross-Cutting Issues

New & improved technologies Technology Transfer

strategy Support CRDP Competitiveness of SA Agric. Organizational Sustainability

Industries that deliver growth now and/or are positioned for further growth: collaborate & de-bottleneck

Industries that are important for desired outcomes but are not yet competitive: lead the way

Start withStart with

Fix the basics: scientific solutions Research & Development Strategy Human Capital Development Knowledge Infrastructure Mitigate agricultural risks Enablers for Innovation

Primary Agricultural activity

Primary Agricultural activity ProcessingProcessing

Packaging / Additional Value

add

Packaging / Additional Value

add

GRAINS

Primary Agricultural activity

Primary Agricultural activity ProcessingProcessing

Packaging / Additional Value

add

Packaging / Additional Value

add

LIVESTOCK

Primary Agricultural activity

Primary Agricultural activity ProcessingProcessing

Packaging / Additional Value

add

Packaging / Additional Value

add

VEGETABLES

Primary AgriculturePrimary Agriculture

ProcessingProcessingPackaging /

Additional Value add

Packaging / Additional Value

add

HORTICULTURE

Primary Agriculture

Primary Agriculture

ProcessingProcessing Packaging / Value add

Packaging / Value add

the Foundation

Product Portfolio

Total Value Chain

AGRO -- P

ROCESSING

Integrating Multi – disciplinary Strategic Objectives

CRDP Goals, Strategies & Objectives

Job Creation

Economic

Growth

PovertyEradication

Sustainable AgriculturalResource Use

Profitability &

Competitiveness

Access &

Participation

Good

Governance

ARC Interventions ARC Interventions

Govt.Policies

Govt.Policies

GoalsGoals

AgribusinessServices &

Infrastructure

Production

Land Reform

Exports

RESEARCH STRATEGY

• Competitive & comparative advantage (e.g. ostrich industry)

• Research towards desired outcomes• Creating a critical mass on specific focus areas• Technology Transfer to communities for economic

growth• Identifying areas of future potential research• Broadening the base of resource mobilization (EU,

Gates Foundation, NRF, MRC etc)• Diversifying capacity building initiatives &

collaboration

RESEARCH APPROACH

• Themes: Cross – Cutting Programmes– Multidisciplinary approach across institutes– e.g. Climate Change, renewable energy

• Institute Specific Programmes– Single institute & commodity specific – e.g. wheat at SGI; maize at GCI; citrus at ITSC etc

• Technology Platforms– Resource for Themes & Institutes – e.g.

Genomics, biotechnology etc

Strategic Objective 1Generate, Develop and Apply new Knowledge and

TechnologyRATIONALE:• Critical component of a knowledge based economy

and people;• Underpins generation of new (novel)

products/processes/ technologies;• Contributes towards excellence and scientific

knowledge;• Enables ARC to use best science to address

agricultural problems unique to RSA & Africa;• Generates intellectual property essential for

economic development

Key Result Area 1.1: Accurate Prediction of risks (drought, disease and pests)A: earth observation & remote sensing for risk prediction

Develop risk models & systems to ensure growth in a changing environment

• 6 publications• 14 info sessions

B: Agriculture drought & water use management

Water availability, accessibility & utilization

• 1 method • information

C: Pests and disease management

Pest ecology and forecasting

Disease epidemiology & forecasting

• 3 publications• 2 methods• 9 information sessions

Strategic Objective 2Sustainable use and management of natural resources

RATIONALE:• Improve efficient use of agricultural natural

resources for food production;• Ensure sustainable use and management;• Reduce risks of failure in agricultural

productivity;• Comparative advantage to industries

dependent on natural resource – based agriculture

Key Result Area 2.1: Characterisation of natural resources & ecological systemsA: Characterisation and quantification

Eco—system auditing and monitoring (e.g. wetlands, weeds and alien invasives)

• 25 publications

• 2 methods

• 59 info sessions

• 4 IP registered

C: Conservation agriculture

Promotion of conservation agriculture

Promotion of organic agriculture

Promotion of integrated sustainable use

• 9 publications

• 49 methods

• 71 info sessions

D: Remediation & rehabilitation

Wetlands

Irrigation systems

Grey water

Agricultural land

Old mining sites

• 15 publications

• 13 methods

• 17 info sessions

Strategic Objective 3Enhance Nutrition Food security and Safety

RATIONALE:• Increase access and availability of nutritious

food;• Broadening the food base to enhance food

security and nutrition;• Improving the inherent nutritional quality of

food at source;• Broadening participation in the value chain

and reducing waste;• Integrated approaches to optimize impact

and adoption of new technologies.

Key Result Area 3.1: Increased access and availability of quality and safe, nutritious foodA: Crop Improvement Develop improved cultivars, lines and

hybrids

Develop improved cultivation practices

Nutrition enhancement through bio-fortification

• 34 publications

• 133 methods

• 463 info sessions

• 8 IP registered

B: Animal Improvement & nutrition

Selection for improved productivity traits

Establish efficient production systems

Improve disease control programmes

Alternative feed/nutrient sources

• 2 publications

• 51 info sessions

C: Agricultural products improvement

Improve nutritive value of food/feed • 17 publications

• 4 methods

• 24 info sessions

D: Broadening the food base

Alternative food sources (e.g. fish & other aquaculture products, wildlife)

• 10 publications

• 9 methods

• 29 info sessions

Strategic Objective 4Manage and mitigate agricultural risk

RATIONALE:• Reduce vulnerability to climate change; • Solutions and management of emerging

pests, diseases, weeds and alien invasives;• Management of natural disasters in

agriculture;• Manage risks to increased agricultural

productivity and trade• Improved utilization of bio – resources

Key Result Area 4.1: Reduced vulnerability of the agricultural sector to climate change A: Assessing the impact of climate change on agriculture natural resources

Prediction models for natural resource management

Drought monitoring and mitigation

• 5 publications

• 9 info sessions

B: Natural resource information and decision support systems

GIS and remote sensing models to support agriculture (AGIS)

• 2 publications

• info sessions

C: Natural resource monitoring, auditing and impact assessment

Rangeland condition assessment and monitoring

Quantity and quality monitoring of natural resources

• info sessions

STRATEGIC OBJECTIVE 5Technology Transfer

RATIONALE:• Creation of value through Agricultural R&D• Transfer ability to utilize new & improved technologies• Contribute to growth in agricultural sector through

Tech Transfer and adoption programmes

• Contribute to increase in exports through the

dissemination of technological innovations

• Effective management of Intellectual Property as per law

Relationships between the Technology Transfer Elements

DECISION SUPPORT:

Agric. Economic Services

&Biometry

PROCESSES

Commerciali-sation

Business Generation

Training

ENABLERSIP Protection & AwarenessKnowledge Management

OUTCOMES

ARC ProfileEffective

Agric-SectorSocio-

economic Benefits

Research and Development

Key Result Area 5.1: Service ProvisionA: External Services Analytical services • 172855 samples

Diagnostic services • 23160 samples

Consultancy services (on demand)

• 41

Advisory services • 14522

B: Training Training Services (courses) • 100

Advisory Services – Info sessions • 4500

Advisory Services – community • 11

C: Internal services Biometric Services 80 % of publications

Economic Services 2 reports

Library Services 80 % of publications

Knowledge Management (audit) 1 report

SUPPORT FOR SUCCESSAttraction & RetentionHuman Capital DevelopmentCompliance to Policies & ProceduresOrganizational & Individual PerformanceEffective Legal ServicesARC Image & CultureIntegrated physical & ICT SecurityEffective utilization of ICT services

HR STRATEGIC IMPERATIVES

• Culture of Excellent Performance throughout ARC. • Recruitment of senior scientists to drive research

agenda• Implementation of HRD strategies to grow new skills

base.• Accelerate joint appointments with academic

institutes and research bodies• Maintaining harmony with organised labour• Manage Transformation and change management

interventions• Implementation of a robust reward & retention

strategies

ICT STRATEGIC IMPERATIVES• Implementation of a robust ICT strategy;

• Effective governance and management practices to align ICT and core business;

• Maximise value for money from existing and future technology investments;

• Ensure access to appropriate skills and resources.

• Ensure a secure ICT infrastructure

MARKETING & COMMUNICATION

• Image & brand management.

• Development & implementation of an integrated communication strategy

• Managing our clients & stakeholders

• Ensuring positive media coverage and reputation

• Dissemination of information to facilitate technology transfer.

SECURITY & LEGAL SERVICES

• Physical security appraisals/evaluations. • Implementation of an Asset Management Strategy• Monitoring & evaluation of Fraud Prevention Plan.• Legislative compliance assessment• Contract review and drafting• Management of servitude applications within the

ARC with regard to ARC property and ensured that the ARC get value with regard to those servitudes

BUDGET FOR IMPLEMENTATIONKEY CONSIDERATIONS

1. Operational PG still minimal- 6%

2. Limited External Income Growth - 3%

3. Cost Containment (Other Operating Costs) – 9%

4. Replacement and upgrading of infrastructure

5. Improving organisational processes to eliminate adverse audit findings.

BUDGET ASSUMPTIONS1. PG (Operational) increase 6%

2. Including Capex 15%

3. External Income Increase 3%

4. General salary increase 6%

5. Other operating Costs 9%

6. Budget Surplus 2009/10 R33m

7. Cash and Cash equivalents 2009/10 R45m

Budget Forecast

R'm R'm R'm R'm

117 124 130 13135 43 45 5264 64 70 6318 17 15 16

657 666 706 7252 2 2 2

201 207 232 211454 457 472 512

774 790 836 856

238 235 277 246135 135 169 135

Deferred Income:Revenue Grants 59 59 59 5944 42 49 52

279 279 279 28129 29 29 31

Deferred Income:Governments Grants 250 250 250 250

517 514 556 526

257 276 281 330

Capital Fund 109 109 109 109Insurance Reserve 3 3 3 3Accumulated Surpluses/ (lossess) 145 164 169 218

257 276 281 330

AGRICULTURAL RESEARCH COUNCIL: CONSOLIDATEDSTATEMENT OF FINANCIAL POSITION

Actual 2008/09

2009/10Budget 2010/11

ASSETSCurrent AssetsCash and Cash equivalentsReceivablesInventories

Non current AssetsInvestmentsEquipmentLand and buildings

Total Assets

LIABILITIESCurrent LiabilitiesPayables

Provisions

Non-current LiabilitiesEmployee Benefits

Total Liabilities

TOTAL CAPITAL FUND

NET ASSETS

Budget Forecast

R'm R'm R'm R'm764 827 795 889

285 312 278 294 470 503 513 590

8 12 4 4 0 0 0

(728) (778) (768) (796)(467) (489) (478) (508)(261) (288) (290) (288)

(0) 0 (0)36 49 27 93

(62) (41) (16) (86)2 -

4(60) (37) (16) (86)

(24) 12 10 7 59 35 35 45

35 47 45 52

AGRICULTURAL RESEARCH COUNCIL: CONSOLIDATEDCASH FLOW STATEMENT

2009/10Budget 2010/11

ReceiptsSales of goods and servicesGrantsInterest receivedDividend received

PaymentsEmployee CostsSuppliers

Cash and cash equivalents at the end of the year

Actual 2008/09

Change in InvestmentsNet cash flow from Investing activities

Net increase/(decrease) in cash and cash equivalentsCash and cash equivalents at the beginning of the period

Finance costsNet cash flows from operating activites

Purchases of property plant and equipmentProceed from sale of properties and equipment

ARC Consolidated Budget: 2010/11

RevenuePG: R590m

External: R277m

Other: R 16m

RevenuePG: R590m

External: R277m

Other: R 16m

Total R884m Total R884m

Expenditure

Personnel: (R508m)

Operating Costs: (R304m)

Depreciation (R23m)

Expenditure

Personnel: (R508m)

Operating Costs: (R304m)

Depreciation (R23m)

Total (R835m) Total (R835m)

SurplusR 49m

SurplusR 49m

Cash Ex OpsR92m

Cash Ex OpsR92m

Net Cash for Year

R6m

Net Cash for Year

R6m

Cash end of Year

R52m

Cash end of Year

R52m

ADDDepreciation: R23mWC Movement: R20m

ADDDepreciation: R23mWC Movement: R20m

Total R43m Total R43m

Cash at BeginningOf Year

Cash at BeginningOf Year

Total R45m Total R45m

Capex(R86m)

Capex(R86m)

Total (R86m) Total (R86m)

Baseline Operational Parliamentary Grant Vs Total Operating Costs

-

200

400

600

800

1,000

1,200

12/13 11/12 10/11 09/10 08/09 07/08 06/07 05/06 04/05 03/04

Financial Year

R'm

s

Operational PG Personnel Costs Total Operating Costs

Total Income vs Total Costs plus Capex

0

200

400

600

800

1000

1200

12/13 11/12 10/11 09/10 08/09 07/08 06/07 05/06 04/05 03/04Financial Year

R'm

Baseline Operational PG External IncomeBaseline Capital Personnel CostsTotal Costs + Capex

AREAS OF FOCUS IN 2010/11

• Audit Issues

• Project costing/management

• Cash Management

• Supply Chain Management

• Capacity

• Funding (for sustainable growth)

CHALLENGES Aging Infrastructure Ageing scientific capacity (demographics) Reduced skills base for recruitment (scientists, engineers

& researchers etc) Urban encroachment – increasing costs of security and

competing demands for land use Meeting its transformation obligations e.g. 50/50 gender

representation; ICT information systems requiring upgrade Insufficient funding (PG and contract income) that may

lead to staff lay-offs

Re a Leboha

Siyabulela

Siyabonga

Siyathokoza

Ha khensa

Ria livhuwa

Baie dankie

THANK YOU