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There are two essential paths that this device could potentially take towards the goal of adoption. It is immaterial whether the product is patented or not at this stage. Patenting the product would, however, require additional time and upfront financial resources which may not be available to a young entrepreneur. They would therefore have to either borrow the money or accept investment in exchange for equity. However, there are also government programmes or incentives that support innovation and technology adoption in utilities, for example, the Technology Innovation Agency. Young entrepeneurs are encouraged to find and participate with such programmes to both offset the initial start-up costs and to also partner with programmes that understand this landscape and the steps required to be taken to promote success.
The first path involves establishing a pilot project within the utility. To do this involves convincing the utility of the benefits of your device/proposal and requesting permission from them to install your product on their network. They may insist on regulatory compliance to ensure that the installation of the device will not cause a safety risk or compromise operational performance. Including compliance, the range of time associated with the potential completion of a pilot project would range from 3 to 5 years. This is a significant amount of time for a company/entrepeneur to wait for confirmation that their product will add value and may therefore be purchased.
Upon successful conclusion of the pilot project, the utility may choose to engage in one of two paths to procure this device. The first would be to submit a sole source justification form which requires the approval of National Treasury and the prerequisite steps of a Request for Proposals (RFP) to ensure that there are not similar products in the market that can achieve the same outcome. One should bear in mind that the outcome is, in this instance, technology agnostic – in that the objective is to detect or reduce the incidence of steel member theft. The proposed device is one potential method of achieving that objective. The justification would therefore need to adress why existing methods are not being employed and what the business case is for the justification of this novel technology. The business case may not be easy to compile for an entrepeneur, as they will require access to very specific and sensitive utility data, which may not always be avaialble. The sole source justification process is rigid and overly specific in state-owned enterprises to ensure that the standard procurement process is not bypassed and to avoid an unfair and corrupt tender being awarded. This is clearly a valid requirement and objective and should not be changed; however, it does add a major barrier to the adoption of innovative products in the utility engineering landscape. If successful, the process from pilot project
initiation to sole source approval could easily take in excess of 5 years. The problem with this method, however, is that the sole source justification framework (excluding the time taken for the pilot project but including the approval from National Treasury) will have to be utilised whenever this product is purchased. It is therefore better to adopt the alternative path upon completion of a successful pilot, as shown in Figure 8.
If one assumes that the utility in question for this product is Eskom, then compliance with the Eskom Procurment Policy (32-1034) (Eskom 2024), specifically clause 8.8.9, would become mandatory. This involves the compilation and publishing of a technical specification, after which a commercial strategy will be established and approved with a multidisciplinary team. The commerial strategy would include steps like an RFQ, an RFP, and sufficient time to evaluate these submissions. As it includes many similar steps to the sole source process, the time required would be similar; however, the process is internal to the utility and once the specification is published, it could be used on future tenders, provided that it is reviewed periodically as per sound technical governance guidelines. Either of these processes cannot be concluded without the support and partnership of the utility. However, this involvement may in itself be the reason for the process being halted. It is sometimes argued that a supplier who works with the utility is given an unfair advantage to any future service provider, and that the outcomes of the pilot could be used by the entrepeneur to further improve the design and service offering of the product. In the opinion of the authors, it is this – and not the time and financial resources required – that is the major stumbling block to innovation in this space. Working with the utility to ensure that the problem is being addressed completely and that the device is fit for purpose could result in the completed product not being able to be sold to address this problem, due to a deemed unfair advantage. The result is unfortunately that you either end up with a product that is not fit for purpose, or no product at all to address the aforementioned challenge.
Should one choose to not establish a pilot site or work in partnership with the utility, then any approach to the utility would have to be in complinace with National Treasury Practice Note No. 11 of 2008/2009, that provides the framework by which an unsolicited bid is managed by a state-owned organisation. An unsolicited bid is a product or service that is unique, innovative, and provided by a sole provider and is outside of an advertised tender process. Many of the steps taken for a successful outcome using this mechanism are the same as used in the alternative leg, i.e. an RFQ, a sound business case, etc. If found to be compliant with the provisions as set out in the Practice Note, the state entity can negotiate directly with the company. In contrast to the alternative path, although there is no prior
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