-as industry faces boiler damage, other challenges
Struggling production, ongoing problems at the Skeldon factory and a turnaround plan which is yet to turn things around are plaguing the sugar industry as Chief Executive Officer, Errol Hanoman exits months ahead of his contract expiration and Finance Director Paul Bhim takes the reins.
Hanoman opted to leave the industry at a critical time, but Agriculture Minister Robert Persaud said yesterday that his departure was not a blow. “Management within the industry will transition smoothly…certainly we have lost tremendous expertise, but there are persons within who we can tap into and continue to implement the plan”, Persaud said.
GuySuCo’s Board of Directors appointed Finance Director, Paul Bhim as the new acting Chief Executive Officer yesterday after Hanoman tendered his resignation on Monday. Hanoman will commence the handing over process to Bhim, according to a press statement from the corporation. It was also reported that Bhim’s appointment was approved by many stakeholders in the industry.
GuySuCo also reported that a meeting with senior managers across the industry and other stakeholders including the unions is scheduled for today; Bhim is expected to be introduced in his new capacity. Bhim has been with the sugar corporation since 1995.
Hanoman, who was appointed CEO in 2009 when the blueprint for success was rolled out, was one of the drivers of the much hyped turnaround plan. His appointment came as Booker-Tate’s longstanding management contract ended with the industry and an interim board was announced. The board subsequently unveiled the turnaround plan.
Hanoman who previously served as Finance Director offered no explanation for his resignation, but sources said he cited personal reasons in private discussions. Hanoman was appointed in February 2009 and resigned just five months into his second one-year tour of duty. His contract also required that he give three months notice of termination but there has been no indication whether this was done. Within the last year Hanoman pushed for an adequate cane supply in the industry, projecting that this was possible in 2011.
Persaud met with Hanoman, Chairman of the Board, Dr. Nanda Gopaul and Bhim yesterday prior to the appointment of the acting CEO. He described the meeting as critical because it identified Bhim as the individual who will lead the industry’s operations with a continued focus on implementing the strategies outlined in the turnaround plan. Persaud termed it a “no disruption” transition as Hanoman exits the industry and Bhim takes over.
Persaud added that Hanoman’s exit is not a blow or a bad sign for the sugar industry, but he acknowledged that the corporation has lost an integral player. He said Hanoman’s skills are well known across the industry and that his contributions to its development also extended far and wide. He insisted that GuySuCo has a vast amount of potential which it can tap into. Still, Persaud pointed out that GuySuCo has started looking for expertise outside of the country and he cited India, Cuba and Brazil. He said the corporation is aware that a certain level of expertise is critical to its operations.
“Production is low”
Reacting to the news of Hanoman’s departure, President of the Guyana Agricultural and General Worker’s Union (GAWU), Komal Chand said the new CEO must focus on improving output. He said production is low and that the first crop numbers this year represent the lowest output during that period since 1991.
“It came as a surprise to me because I heard nothing that he was contemplating resignation as the head of GuySuCo”, Chand said yesterday. Chand said Hanoman was a critical part of the management team driving the turnaround plan.
The production target for this year was set at 280,000 tonnes and the first crop output fell below target, recording a deficit of 9,813 tonnes. The second crop is expected to start later this month, but it could be delayed if the inclement weather persists; the low first crop output means the industry has to produce over 190,000 tonnes in the second crop to meet the target set in the budget.
Chand said the corporation has the land and a new factory, but that it has been “unable to put it right”. He stressed that the industry also needs to focus on its workforce saying the sugar workers must be satisfied. He said low wage increases have been affecting morale among other things. “If they begin to lose the workforce this will have a major impact on the objectives and goals of the turnaround plan”, he noted.
He said too that the new CEO faces a major challenge of implementing the plan because of the critical goal to produce around 400,000 tonnes of sugar in another two years. Pointing to the current target set and the setbacks, he said this indicates how huge the task is to reach 400,000 tonnes. Further, he said the Skeldon factory needs to be fully operational, adding that the major defects need to be corrected.
“It is sad that a new factory is not performing as it should…that there are still so many teething problems is a serious indictment on the industry”, Chand argued. He said too that cane cultivation is critical because the new factory has the capacity to grind 350 tonnes an hour.
General Secretary of NAACIE, Kenneth Joseph said yesterday that the industry has lost much experience with Hanoman’s exit. He said Hanoman’s expertise can be tapped, noting also that the union is prepared to work with the new acting CEO in the interest of the industry.
Boiler badly damaged
GuySuCo reported on Monday that the no # 1 boiler at the Skeldon Sugar Factory experienced technical difficulties last weekend which damaged its pressure parts. It said that the damage will not result in a delay to the start of the 2nd crop this year at Skeldon and will similarly not affect production during this period.
There are reports of an explosion at the boiler and that a wall collapsed as a result. The corporation’s Public Relations Officer, Romel Roopnarine told Stabroek News he was not in a position to deny the reports, indicating that he would check with the relevant individuals to ascertain if there was such an incident. He said he would report back to this newspaper when the information is provided.
Roopnarine said it was a case where technical difficulties were encountered while the boiler was being cleaned. He said too that the manufacturer of the boiler has been alerted and corrective work is expected to commence within a week. However, he noted that the boiler requires a certain level of expertise and servicing.
Commenting also on the boiler, Chand said there was a defective valve. He said the corporation has insurance coverage to cover the boiler, but pointed out that the severe damage to the boiler could affect the smooth functioning of the factory until the situation is rectified.
