We earned SAZ honour: Dr Sithole
THE Manica Post recently had an interview with Allied Timbers Zimbabwe Chief Executive Officer Dr Dan Sithole after the company was honoured by the Standard Association of Zimbabwe for being the biggest corporate contributor to standards over the last year. Excerpts:
What does the Standard Association of Zimbabwe Award mean to Allied Timbers?
SAZ award is a Hallmark of Excellence. It is a significant milestone in the recovery of Allied Timbers Zimbabwe.
The award delivers an important message to our Stakeholders that Allied Timbers is coming out of the woods.
Why do you think Allied Timbers was
singled out for this honour? Singled out, just singled out? No! we earned the recognition by the SAZ, because we worked very hard over three (3) years along ATZ’s very long value chain that spans forest plantation development, sawmilling, pole treatment, timber products, manufacturing and retail.
We have a whole range of products that are now manufactured under license
from SAZ:
◆ ZWS 120 – Hardwood poles and cross arms
◆ ZWS 553 — Hardwood poles, droppers, laths, guardrail posts and spacer blocks
◆ ZWS 169 — Stock laminated timber
◆ ZWS 203 — Laminated scaffolding timber
◆ ZWS 184 — wooden doors
◆ ZWS 208 — Finger jointed structural timber
◆ ZWS 257 parts 1 and 4 — Visual stress graded structural timber for frame wall construction (with finger joint) SAZ achievement is recognition of a company-wide organisational cultural change because quality is not a destination but a journey undertaken by the entire organization. That’s what makes it very difficult to reach and maintain SAZ expectations because no-one should slacken along the long value chain. The rewards of obtaining SAZ
achievement are many:
◆ SAZ award signifies acceptance of shared values, shared vision and shared mission and that the entire organisation is working in unison moving lock-step in the same direction.
◆ From a business point of view SAZ Hallmark of Excellence opens wide doors to the export market for our products that earn valuable forex for us and the nation e.g. Through the SAZ mark we have penetrated the SADC regional market for creosote treated transmission poles and fencing poles for farms, game parks and dualised highways.
◆ Our sawn timber, S5and laminated beams obtained from mature and high-quality plantation timber managed by seasoned foresters is in high demand throughout the SADC region. The SAZ mark assures our clients of the highest quality of our products and services.
Do you think this honour is in a way a reward for the efforts Allied Timbers has been making to boost its performance?
ATZ is truly humbled by the honour that has been bestowed on us by the SAZ. I said earlier on that Allied Timbers is coming out of the woods. This was my humble way of sharing with you the sterling work that we have done to resuscitate our pole leadership position in the forestry and timber industry. Without going into detail about our financial performance since we came in as new management in January 2016, I am pleased to share with you that we have managed to reduce significantly the payroll ratio to revenue from 162 percent in January 2016 to only 20.9 percent in June 2018. This enormous achievement is well below the 30 percent threshold set by the Government.
Furthermore, Father Christmas has come early this year to Allied Timbers employees. We have managed to clear 18 months payroll backlog with most of our employees from 18 months backlog in January 2016 to almost 2 months in October 2018. I can assure you we will clear all arrears by December 2018 and have a clean state in January 2019. We attribute this great performance to the organizational cultural change that was facilitated by the SAZ.
The prevailing economic climate has pushed many companies to the brink of collapse, what has Allied Timbers put in
place to stay afloat?
◆ We are fortunate in that we have a strong Shareholder support in the new Republic. Additionally, ATZ has the largest biological resource i.e. the largest forestry plantation base of prime mature and high-quality timber – this is undoubtedly a competitive advantage.
◆ The demand for timber is very strong locally and regionally. Zimbabwean aspirations for high quality housing is amazing. The success of the land distribution exercise coupled with the drive for rural electrification and dualised highways has significantly steeped the
demand for timber and creosote treated poles.
◆ Almost everyone now realises that “money grows on trees — the renewable way!’
◆ So Allied Timbers is looking for strategic partners who can come in with new technology to boost our production efficiencies. We need to exploit “whole tree utilisation strategy”. Right now we are utilising only 40 percent of the tree we look after for 25 years. 60 percent is thrown away as waste because of limited technology to process it. We can easily augment our revenues and profit by just processing the 60 percent waste. What major challenges is
Allied Timbers facing?
I have already alluded to the challenges that we are facing such obsolete, inefficient and expensive equipment to run. Limited technology prohibit us from optimal utilisation of own tree resource and in the process bars us from achieving full value from our +25 years investments in our forest plantation.
The other major challenge is illegal settlers in commercial forest plantations. Allied Timbers and all other major timber growers are under siege from illegal settlers who are destroying forest plantations.
Of Zimbabwe’s land mass of 39.2 million hectares, the area suitable for commercial forestry is only 200,000hectares a mere 0.02 percent. On this tiny piece of land timber growers have made the nation proud and self-sufficient in timber. We earn valuable foreign currency through exports of the surplus timber.
Additionally, commercial forestry land is the source of major fresh water rivers including Rusape, Odzi, Mutare, Pungwe, Mhakwe, Nyanyadzi, Risitu and Tanganda.
The forestry industry and the fresh water rivers are under serious threats and require immediate comprehensive protection.