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Terms of Reference ICT DIFFUSION and ICT APPLICATIONS in USAGE SECTORS

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Terms of Reference ICT DIFFUSION and ICT APPLICATIONS in USAGE SECTORS Powered By Docstoc
					SAITIS PROJECT OFFICE

Terms of Reference ICT DIFFUSION and ICT APPLICATIONS in USAGE SECTORS

Private Bag X84 Pretoria 0001 South Africa www.saitis.co.za

Telephone: +27 (12) 310 1496 Facsimile: +27 (12) 322 4600

Introduction
Two of the initiatives emerging from the South African Information Technology Industry Strategy (SAITIS) project focus on facilitating the diffusion of information and communication technologies in a range of sectors of the economy. The objective of this initiative, in combining the two initiatives, is to help South African experts and firms understand the potential for ICT application diffusion in a range of economic sectors in order to help supplier and user firms to develop their strategies, and in order to help government understand better how to facilitate the development and diffusion of these technologies. This initiative will be built on existing studies, such as the Foresight studies that were prepared with the assistance of the Department of Arts, Culture, Science and Technology, and the technology mapping exercises currently supported by the same Department. They will also draw on other industrial sector initiatives, and on “Driving Competitiveness: An Integrated Industrial Strategy for Sustainable Employment and Growth in South Africa” prepared by the Department of Trade and Industry.

This initiative, supported by SAITIS, will be the first step in conducting an extended set of sectoral studies, which will be supported by non-SAITIS funds. The latter project will extend beyond the life of the SAITIS programme, and will draw on its findings.

It is anticipated that the full project will generate three types of key strategic outcomes. Firstly, South African participants in the vertical markets for ICT will have objective information that will guide their decisions to invest in human and physical capital. Secondly, domestic ICT vendors and service providers will have a better idea of what different types of vertical market in South Africa might be expected to require in the relatively near future. Therefore they will be able to develop suitable products and services for domestic consumption, which might also be internationally competitive products or services. Finally, government will have a better sense of where to direct some of it research and development programmes and industrial development facilities, whether through the science vote or departmental programmes, and more guidance regarding the commitment of funds for human resource development. Other
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beneficiaries will be the science councils and a range of education and training institutions, private and public.

Motivation for the Initiative
The overall motivation for the initiative is set out below: The diffusion of information and communication technologies in the late 20th and early 21st centuries is an industrial revolution that parallels earlier industrial revolutions such as the introduction of the steam engine from the late 18th century and the diffusion of electricity and the internal combustion engine from the late 19th century, or the introduction of the telegraph and telephone in the same period. Debates will continue until well after this revolution is over whether the information revolution is as big as the steam engine, or only as big as the telephone or radio. The importance of the new economy for a developing country like South Africa is in its potential to raise living standards and create jobs. The introduction and diffusion of information and communication technologies has the potential to considerably raise productivity rates, hence competitiveness, investment and employment. As the 2001 ILO World Employment report argues: Evidence shows that the countries that have had the greatest growth in “total factor productivity” in the 1990s are those where ICT has been most widely used in the economy. These are also the countries in which employment has grown the most. There is evidence that employment ratios are highest in those countries in which the use of ICT is most widespread. Evidence also shows that unemployment has declined most in countries where Internet use is most widespread….1 A recent paper by two members of the Council of Economic Advisors in the White House strongly supported these conclusions, based on the analysis of data from the United States. Investment in ICT helped accelerate productivity growth in a range of sectors, not only in the high-tech sector itself.2 In other words, empirical evidence seems to show a connection between ICT diffusion, growth in total factor productivity, and effective employment growth. However, firm level studies have shown that in order to get significant productivity effects out of the introduction of ICT technologies, the firm must engage in significant reengineering in its internal operations and its relations with outside firms, and that it must commit significant resources to training employees to exploit the new technologies and systems. Without these organizational and training commitments, investment in ICT technologies is a waste of resources.

International Labour Organisation, World Employment Report 2001: Life at Work in the Information Economy, Overview, web printout page 5. 2 Martin Neil Baily and Robert Z. Lawrence, Do We Have A New E-Economy, National Bureau for Economic Research Working Paper 8243, Cambridge MA, April 2001.
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Therefore, there are several key ingredients in an effective new economy strategy; these include good education and training systems, a strong innovation environment, the managerial capabilities to reorganize internal and external business systems, and a regulatory environment that can accommodate and encourage the rapid adoption and diffusion of new ways of doing business. South Africa has the potential to gain hugely from the new economy. South Africans are rapid adopters of new technologies, but this has been limited to an educated and skilled elite. So, while early figures for the adoption of ICT technologies show South Africa as a leader, if our still unequal society is not managed effectively we risk falling back rapidly in the race to adopt the new technologies and business systems. Our challenge is to stay ahead, and this requires strong human resource programmes and nimble regulatory systems that can meet all our challenges, but not sacrifice one for another. There are many issues to confront in addressing the opportunities and potential pitfalls of the information revolution. These include how to create an environment in which the information revolution will take hold and thrive, how to overcome the inequalities in society, harnessing ICTs to improve the democratic functioning of government and society, and many others. This project seeks to address a very specific group of issues, which nevertheless have broad policy implications. These are: what are the likely trajectories for the absorption of ICTs in a range of economic sectors, and how can the policies and strategies of government and the domestic private sector be adjusted or reshaped so that the South African population and South African-based businesses benefit as much as possible from this process?

Overview of the Project
The overall project is broken into two phases, one supported by SAITIS funds, and one supported by non-SAITIS funds. The project will use the existing recent research work such as the Foresight studies, and the technology mapping exercises currently being run by the Department of Arts Culture, Science and Technology. More specifically, the project will examine a number of “vertical markets” for information and communication technology from two perspectives. The first perspective will be through a worldwide scan and will be funded by SAITIS. The second perspective will be research in each of those sectors in South Africa and will be funded by non-SAITIS funds. The international report will describe trends in the chosen sectors and advise on key expected trajectories over the next five-to-ten years or so. It will also provide pointers to the Sectoral researchers on research methodologies. The sectors to be selected will be drawn from three categories: traditional sectors, service sectors, and new economy sectors. Examples of traditional sectors are mining, agriculture and manufacturing; service sectors could include several of government services, health services, education, tourism or transport; while new economy sectors could include IT hardware manufacture, software manufacture, telecommunications,
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biotechnology or e-commerce. For sectors that are not very homogenous such as manufacturing, it might be necessary to draw on one or two “typical” sub-sectors, such as food processing or clothing, or automobile or electronic goods manufacture, or chemicals or paper manufacturing, for example. The international report, that is the component of the project supported by the SAITIS initiative, will be presented at a workshop of the Sectoral researchers and other interested parties, who will have seen the report at least two weeks before the meeting. The Sectoral researchers will present their research plans to the meeting at the end of which they will be provided with recommendations on how to revise their research plans. The sectoral research phase, which is the element of the project not supported by SAITIS funding, will be divided in two halves, the first half being a report on the status quo and recent trends, and the latter being a view on the future and key strategies to achieve the objectives of jobs, competitiveness, and wealth creation in South Africa. Each of the completed reports will be work-shopped at a small meeting of experts and practitioners in the sectoral field, and then presented at a joint meeting. The final element of the project will be a strategic report that will seek to identify the major themes and issues in the reports and identify broad or specific strategic messages. Three types of key strategic outcomes are expected to emerge from the project. Firstly, South African participants in the vertical markets for ICT will have information that will guide their decisions to invest in human and physical capital. Secondly, domestic ICT vendors and service providers will have a better idea of what different types of vertical market in South Africa might be expected to require in the relatively near future. Therefore they will be able to develop suitable products and services for domestic consumption, which might also be internationally competitive products or services. Finally, government will have a better sense of where to direct some of it research and development programmes and industrial development facilities, whether through the science vote or departmental programmes, and more guidance regarding the commitment of funds for human resource development. Other beneficiaries will be the science councils and a range of education and training institutions, private and public. The final reports will be presented to the executive board of the DTI, and to other interested parties where appropriate. Part or all of the report might also be published. A reference group that will consist of members or representatives of business, labour, government, and other relevant sectors will oversee the entire project. The DTI will be represented on the reference committee by Alan Hirsch (project supervisor), Prof David Kaplan (Chief Economist), Pearl Thandrayan (donor coordinator) and Bahle Sibisi (deputy director general and head of the Enterprise and Industry Development Division) or his permanent representative. Other government representatives may be drawn from the Department of Arts, Culture, Science and Technology and other relevant departments.

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Scope of work to be performed
The scope of the international study to be funded by SAITIS includes the identification of current and future trends in the application and diffusion of information and communication technologies in the range of sectors to be studied in the sectoral projects. This element will draw on the experience of the most advanced industrial countries and on developing countries that are pioneering the application and diffusion of ICTs in those sectors relevant to this research programme. The paper will also propose research methodologies and approaches for the sectoral studies to follow. The sectors to be covered will be finalised after further discussions with researchers. At present they are expected to be no more than eight of:

Traditional sectors: Mining (possibly a sub-sector thereof) Agriculture (possibly a sub-sector thereof) Manufacturing in two components: Light manufacturing e.g. furniture, clothing or food Complex manufacture such as automobiles or chemical products

Service sectors, two or three of: Government Health Education Tourism

New Economy Sectors, one or two of: E/M Commerce Telecommunications Software manufacture/systems development Biotechnology

Outputs
The expected results of this project are: A report on present and expected international trends in ICT application and diffusion in the relevant sectors. The report will also provide guidance on research strategies for the sectoral researchers, including guidance regarding key experts and research publications in the relevant fields. The researcher will present the report at a workshop at which sectoral researchers will
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be present. The researcher will assist the project supervisor and the project leader of the sectoral project in advising the sectoral researchers regarding the finalisation of their research proposals. The researcher will be available to provide advice to the project leader and supervisor and the researchers during the early stage of the sectoral research project. The envisaged activities will require him or her to: To prepare a report that identifies expected trends over the next five to ten years in the adoption and diffusion of ICTs generally, and most particularly in the eight sectors identified by the programme. These results will be based on the experience of developed and developing countries with relevant sectoral trends, and on scientific expectations of future trends. It will also draw on recent South African work in the field, such as the foresight studies and the technology mapping process, if these are ready. The report will also give guidelines in the form of proposed methodologies chapter headings, sources and research strategies for the sectoral studies. The report will be circulated two weeks before the workshop at which the paper will be presented, and at which the sectoral researchers will present their research plans for critique and revision. The researcher will continue to provide advice where reasonably requested to the project leader and supervisor and the sectoral researchers during the early part of the sectoral project, i.e. for two months after the workshop. A maximum of three days of consultation time should be set aside for this.

Definition of Acceptable Bidders
SAITIS wishes to deal only with the person in the organisation that will be ultimately delivering the work. For this reason, subcontracting of major elements of the work by the organisation that bids will not be desirable. Our preference would be for the bidding organisation to have most of the expertise in-house to be able to deliver the work.

Submission of proposal
Proposals should reach the SAITIS Project office no later than 12:00pm on 03 December 2001. Proposals (hard copy and on disk) may be delivered at the SAITIS Project Office, Room 805, Fedlife Building (Department of Trade and Industry), Cnr Prinsloo and Church, Pretoria. All proposals must be submitted in Microsoft Word for Windows, or RTF format.

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Reference
At least three references must be submitted with the proposal.

Awarding of contract
The successful applicant will start work on this project on 17 December 2001. This contract must be completed within a 8 week period, i.e. by 15 February 2002.

Proposal Structure and Content
Overview of Organisations Capabilities/Experience. Personnel Assigned (CV of each person). Contact Details. Submissions are to include contact details, including telephone number and email address (es). Description of Services/Work to be performed. Methodology. Deliverables Delivery Schedule. It is required from bidders to include a project plan in the proposal. Other Requirements (address whatever else is requested in the Terms of Reference). The proposal should not exceed 20 Pages.

Contract Price
The contract price shall be a fixed price, not exceeding R150 000-00, including VAT, with VAT specified as a separate line item. All travel and living expenses are to be included in this value, and no additional claims will be entertained by SAITIS. Bidders are requested to submit the contract price separate from the proposal (in one envelope).

Payment Schedule
The contract price will be divided into categories relating to the deliverables and the candidate will be paid after successful delivery of each deliverable.The payment schedule will be as follows: January 15, 2002 (completion of draft report), January 30, 2002 (completion of workshop) February 15, 2002 (completion of the final report)

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Proprietary Rights
The contractor agrees that all rights, to be acknowledged, understood and adhered-to by the contractor on acceptance of bid by SAITIS, including, without limitation, all intellectual and other proprietary rights, in and to any materials, data, or information, including all computer programs (in source code or object code) and documentation related thereto, which have been provided by SAITIS to the contractor in connection with the performance of any of the services are owned and shall continue to be owned by SAITIS or its licensors. SAITIS shall have unrestricted access to all such materials, data and information. The contractor shall deliver any or all such materials, data and information to SAITIS immediately upon the request of SAITIS. The contractor agrees further that all rights, including all intellectual and other proprietary rights, in and to any methods, processes, procedures, systems, inventions (whether patentable or not), devices, discoveries, concepts, ideas, algorithms, formulae, know-how, data and databases, technology, products, software (in executable and source code), templates, documentation, specifications, compilations, designs, reports, trade-marks, and any enhancements, modifications, or additions to the foregoing or to any products owned, marketed or used by SAITIS, which have been created or developed by or for the contractor in connection with the performance of any of the Services hereunder (collectively, the “Work Product”) shall be owned exclusively by SAITIS. The contractor hereby assigns any and all rights it may have in the Work Product to SAITIS. The contractor shall, at the request of SAITIS, obtain a waiver of moral rights from each of its employees and any other individual who participated in the creation or development of any works in connection with this Agreement. The contractor agrees to do and execute or cause to be made, done or executed all such further and other things, acts, deeds, documents, assignments and assurances as may be necessary or reasonably required to give full effect to assignment to SAITIS of its rights hereunder.

Handling of Queries
The SAITIS ICT Diffusion and ICT Applications in Usage Sectors Initiative Manager: Lyndon Johnson Telephone: 012 310 1486 Cellphone: 082 450 3487 Lyndon@saitis.co.za will act as the central point of contact on all queries that bidders may have.

Additional Requirements
It will be expected from the contractor to meet with the SAITIS Project Office as well as the Department of Trade and Industry on a regular basis, in order to discuss the progress of this project. Weekly meetings are suggested.
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Evaluation Criteria
SAITIS PROJECT OFFICE
Workpackage No: Workpackage Name: Evaluated By: Date: Bidders will first be evaluated across the following three categories: Element Description Weight Past Experience 30 This will include: Previous experience in research and facilitation, supported by CVs in the Appendix An understanding of the ICT Sector and Enterprise Development. Input from references, where necessary 2 Approach and Methodology 40 This will include a review of: The methodology to be employed for each of the Phases. • Number of interviews by type of interview by Phase, where applicable • Time Management • The Project Plan and delivery schedule • 3 Equity 30 Either 15 Equity Ownership by Previously Disadvantaged Individuals (PDI): • Bidders will receive a percentage of the points given. • And/or Equity Ownership by Women:. • 15 Bidder will receive a percentage of the points given. • Maximum Points 100 The top three bidders with the highest points (and having at least 65 points) emerging from the process above will be evaluated on price, as follows. The remaining bidders will be eliminated. 4 Price 30 The formula that will be used to determine the number of points awarded will be: Lowest Bidder Price Currently Evaluated Bidder Price Maximum Points Available X 30 130 Item 1 Rate

The points achieved on price will be added to the points achieved in the first three categories. The bidder with the highest score will be awarded the contract.

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Description: Terms of Reference ICT DIFFUSION and ICT APPLICATIONS in USAGE SECTORS