Transnet is a state owned company (SOC) which is a custodian of freight rail, ports and pipeline. It is responsible for enabling competitiveness, growth and development of the South African economy through the delivery of reliable transport and handling of services that satisfy customer demand. Its mandate from the government is to assist in lowering the cost of doing business in South Africa, thus enabling economic growth and ensuring security of supply through providing appropriate ports, rail and pipeline infrastructure in a cost-effective and efficient manner within acceptable benchmarks. As an SOC, its mandate and strategic objectives are aligned with the Government’s NGP and the Statement of Strategic Intent issued by the Minister of …show more content…
The strategies were appropriate for the climate in which the business was operating. Figure 2 below shows the three strategies and what they entailed. The discussion will be based on the current strategy named “Market Demand Strategy (MDS)”, which became applicable in 1 April 2012.

The MDS is a growth strategy which emphasises building of capacity ahead of demand. In order to achieve its objectives, the following will be carried out:
 R300bn capital investment programme
 Expanding rail, port and pipeline infrastructure
 Increase in capacity to meet market demand
 Continued financial stability and strength
 Significant productivity and operational efficiency improvements
 Shift from road to rail – reducing the cost of doing business and carbon …show more content…
Therefore, it is recognised that its success is dependent on effective and efficient execution. In the developmental stages of the strategy, it was noted that sufficient flexibility was necessary in order to respond effectively to external shocks, which in turn necessitated the creation of sufficient internal capability to build adequate buffers to the imminent change. To this end, Transnet adopted a decentralisation strategy in order to achieve greater structural flexibility. This affected daily decision making which enhanced accountability at all levels of the organisation. However, it would not be prudent for Transnet to just embark on such a risky exercise without proper preparation. In order to ensure that the system was not compromised by the change, Transnet ensured that compliance with Standard Operating Procedures (SOPs) was strictly observed. Further to that, it was recognised that goal setting was supposed to have more detail. This necessitated a radical improvement of the quality of Transnet’s measurement and decision support systems (Transnet,