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Page 1 of 48 11/10/2005
REQUEST FOR INFORMATION
ENTERPRISE RESOURCE PLANNING SYSTEM
Ref no: G428/05
Page 2 of 48 11/10/2005
Table of Contents
1 Background ..................................................................................................................................... 6 1.1 About Harmony...................................................................................................................... 6 1.2 Operations ............................................................................................................................... 6
2 Business Case for an Enterprise Resource Planning System ....................................... 8 3 Application requirements- Finance......................................................................................... 8
3.1 Central services ..................................................................................................................... 9 3.1.1 Cash and Bank ............................................................................................................... 9 3.1.2 Treasury ......................................................................................................................... 10 3.1.3 Creditors and provisions .......................................................................................... 11 3.1.4 Other receivables ........................................................................................................ 11 3.1.5 Accounts analysis, reconciliation and review ................................................... 11 3.1.6 General Ledger maintenance ................................................................................. 12
3.2 Group Taxation and Reporting....................................................................................... 12 3.2.1 Month end reporting .................................................................................................. 12 3.2.2 Period end reporting .................................................................................................. 12 3.2.3 Consolidations .............................................................................................................. 12 3.2.4 Intercompany transactions ..................................................................................... 13
3.3 Shaft and Plant Accounting ............................................................................................. 13 3.3.1 Monthly reporting ....................................................................................................... 13 3.3.2 Journal processing ...................................................................................................... 13 3.3.3 Budgeting and forecasting....................................................................................... 13
3.4 Capital accounting (Shaft and plant) .......................................................................... 14 3.5 Fixed Assets .......................................................................................................................... 15
3.5.1 Capital expenditure .................................................................................................... 15 3.5.2 Amortisation and depreciation ............................................................................... 15 3.5.3 Impairments ................................................................................................................. 15 3.5.4 Transfers and disposals ............................................................................................ 15
3.6 Job Costing ............................................................................................................................ 16 3.6.1 Workshops ..................................................................................................................... 16
4 Application requirements - Supply Chain .......................................................................... 16 4.1 Warehousing and Inventory Management ................................................................ 16 4.2 Contract Management....................................................................................................... 16 4.3 Procurement ......................................................................................................................... 16 4.4 Vendor Management ......................................................................................................... 17 4.5 Catalogues............................................................................................................................. 17
5 Technical information ................................................................................................................ 18 5.1 Masterpiece overview........................................................................................................ 18
5.1.1 Current Systems Structure Diagram ................................................................... 18 5.1.2 Current System Structure ....................................................................................... 18 5.1.3 Current systems – Interfacing with Masterpiece ............................................ 19
5.2 General system requirements........................................................................................ 20 5.2.1 Integration..................................................................................................................... 22 5.2.2 Workflow ........................................................................................................................ 22
5.3 IT Infrastructure.................................................................................................................. 22 5.3.1 Network technology ................................................................................................... 22
Page 3 of 48 11/10/2005
5.3.2 Database Technology ................................................................................................ 23 5.3.3 Desktop Technology................................................................................................... 24 5.3.4 Hardware Platform ..................................................................................................... 25 5.3.5 Server platform ........................................................................................................... 25 5.3.6 Programming languages .......................................................................................... 25 5.3.7 User-interface Requirements.................................................................................. 25 5.3.8 Security Requirements.............................................................................................. 25 5.3.9 Application Security and Access Requirements............................................... 26
APPENDIX A .......................................................................................................................................... 28 6 Commercial information ........................................................................................................... 28
6.1 Company information........................................................................................................ 28 6.1.1 Your company structure ........................................................................................... 29 6.1.2 Details of your company’s board of directors .................................................. 30
6.2 Strategic Partnerships and Alliances ........................................................................... 31 6.3 Financial Information......................................................................................................... 31 6.4 Solution functionality......................................................................................................... 32 6.5 Experience ............................................................................................................................. 34 6.6 Customer Base..................................................................................................................... 36 6.7 Sub-contracting and Joint Ventures ............................................................................ 37 6.8 Black Economic Empowerment...................................................................................... 38 6.9 Support and maintenance ............................................................................................... 40 6.10 Technical ............................................................................................................................ 40 6.11 Solution pricing................................................................................................................ 41 6.12 Training............................................................................................................................... 42 6.13 Legal requirements ........................................................................................................ 42 6.14 Tax clearance ................................................................................................................... 43 6.15 Software Vendors’ Questionnaire ............................................................................. 44
6.15.1 Product Strategy ..................................................................................................... 44 APPENDIX B - Acknowledgement ................................................................................................. 46
Page 4 of 48 11/10/2005
Enterprise Resource Planning System for Harmony
Note: This document is a Request for Information and not a tender or Request for Proposal. Harmony reserves the right not to issue a Request for Proposal following this RFI.
Harmony is investigating the possibilities of implementing an Enterprise Resource Planning system for its Financial and Supply Chain Management functions. The proposed solution should be designed to meet our business needs. Potential vendors are invited to submit information on a solution that will meet our needs as defined in the Request for Information.
All information submitted to Harmony in response to this RFI will be handled with utmost sensitivity and confidentiality. The information will be used for identifying potential Enterprise Resource Planning software solutions providers and not for any other purpose.
Please direct any queries to the issuing officer either in writing or by e-mail to the following address, erp@harmony.co.za, by no later than close of business on 14th November 2005.
The closing date for submitting responses to this RFI is 12 noon on 17th November 2005.
Responses should be submitted to the issuing officer at the address stated below. Presentation of responses should be in Soft Copy on a CD and three Hard Copies.
Issuing officer: Pierre Venter
Phone: (011) 278 0077
Fax: (011) 278 0097
Address:
Randfontein
Harmony Gold Mining Company Limited
Procurement Department
GDS Main Stores
Phillip Von Weillegh Drive
Zuurbekom
Page 5 of 48 11/10/2005
Or
Free State: Free Gold Procurement Department Central Services Jan Hoffmeyer Road President Steyn Road turn-off Welkom (On Welkom-Virginia Road) Or Evander: Harmony Gold Mining Co. LTD Evander Procurement Department Central Services 7# Main Stores Off Rotterdam Road Evander.
Page 6 of 48 11/10/2005
1 Background
1.1 About Harmony
Harmony Gold Mining Company Limited was formed in 1950 as a Rand
Mines managed company to exploit the single Harmony mine lease. In
1995, the company was rejuvenated as a separate entity following the
demise of Rand Mines. At that time, the company produced 650,310
ounces of gold and employed 16,000 people.
Today, Harmony is the sixth largest producer in the world, with increasing
growth potential in South Africa and Australia. In the financial year 2005,
Harmony produced 3 million ounces of gold, predominantly from South
African sources.
Harmony owns the world’s largest gold ore resource. Harmony has a
mineral resource of 528.6 million ounces at a cut-off of 250cm g/t, of which
54.1 million ounces are in the ore reserve category, using a long-term gold
price of R92,000/kg.
Harmony Gold Mining Company Limited is engaged in gold and related
mining operations in South Africa, Australia and Papua New Guinea, in
addition to exploration, minerals and participation rights in South Africa,
Peru and elsewhere in Africa. The company has been successful in its
strategy of growth through acquisitions and has emerged as one of the top
gold producers in the world, and the third largest in South Africa.
1.2 Operations
The company’s main operations are located in the Free State, Evander,
Randfontein and West Rand regions of the Witwatersrand basin, as well as
in the Kraaipan Greenstone Belt of the North West Province, where the
Kalgold open pit mine is situated. Harmony’s offshore operations include
our operations in Australia. Other major listed investments include Gold
Fields and African Rainbow Minerals. Harmony’s Free State operation was
its sole producer in 1995 and through a process of acquiring local adjoining
Page 7 of 48 11/10/2005
properties, continues to contribute approximately 600 000 ounces of gold
to the company’s overall production.
Evander, which was acquired in 1998 after it had been consolidated
through the merger of four mines and other mineral rights interests,
produces approximately 400 000 ounces a year.
In 1998 and 1999 Harmony acquired the Bisset operation in Canada and
Kalgold in South Africa. Kalgold and parts of the Australian operations
represent the group’s opencast capacity. The Hidden Valley project is
planned to be an open-pit operation which, if approved, will add further to
Harmony’s open-pit and international production capacity.
Harmony has since 2000 acquired Randfontein, Elandsrand and Deelkraal
(Elandskraal) from AngloGold.
In addition, the company initiated a new era for financing, by issuing the
first corporate bond in the South African gold industry, valued at R1,2bn.
These corporate activities positioned Harmony in a stronger position to
pursue its growth strategy at a time when the US$ gold price was trading
at historical lows.
In November 2001, Harmony and ARMgold announced that they were
successful in their bid to acquire AngloGold’s Free State assets, Free Gold,
in a 50/50 Joint Venture initiative, for a total consideration of R2.7 billion.
The Free Gold assets consist of the mines and associated infrastructure of
Joel, Tshepong, Matjhabeng and Bambanani, and other mineral rights.
As an unhedged company we remain highly leveraged to changes in the
gold price. Our more recent success at the cost improvements at Target
Mine, acquired in 2004, reiterates our proven ability to turn-around and
reinvigorate South African Gold Mines turning them into low-cost, high-
margin, long-life, high-productivity operations. Through the success of its
strategy Harmony has become the sixth largest gold producer in the world.
Page 8 of 48 11/10/2005
2 Business Case for an Enterprise Resource Planning System
Harmony currently uses legacy systems for finance and supply chain
management processes. A lot of critical activities take place outside of the
system e.g. Excel spreadsheets for budgeting and reporting. The changing
business requirements of Harmony have necessitated the implementation
of an Enterprise Reporting System that will support its business processes.
The current system has also reached the end of its lifecycle. The use of
manual processes such as spreadsheets increases the risk of fraud and
misappropriation.
Implementation of the ERP will ensure adequate technology support for the
business and will be a critical enabler in ensuring that Harmony achieves its
goal of world class service delivery.
As an entity listed on the NYSE, Harmony has the additional requirement to
ensure that it complies with the Sarbanes-Oxley Act. One of the main
requirements of this legislation is that companies should have proper
internal controls over their financial statements and the financial
environment surrounding the financial statements and report on the
effectiveness of these controls.
3 Application requirements- Finance
The Finance Division is responsible for the recording of all transactions,
capital projects, financial and management accounting, financial reporting,
job costing as well as the consolidation and analysis of financial
information.
The finance function consists of the following divisions:
• Central Services (Accounts payable, Accounts receivable, Bank,
Cash, Treasury and General Ledger)
• Group Reporting and Taxation (including intercompany
transactions, consolidations and month end and period end
reporting)
Page 9 of 48 11/10/2005
• Shaft and Plant Accounting
• Fixed Assets and Capital Accounting
• Capital Accounting
• Job Costing
The management of treasury investments is outsourced to Andisa.
Central Services, Group Reporting and Taxation, as well as the Senior
Management responsible for Shaft, Plant and Capital Accounting are
based at the Harmony Head Office in Randfontein.
In addition to being listed on the Johannesburg Stock Exchange,
Harmony Gold has a secondary listing on the New York Stock
Exchange. This listing requires that they file an annual report with the
Securities and Exchange Commission, the body responsible for
regulating all entities listed on the New York Stock Exchange. This
process is handled by the Group Taxation and Reporting division.
3.1 Central services
3.1.1 Cash and Bank
There is no cash book functionality within the Masterpiece system. All cash
entries are performed via journals. Cashiers are located in the following
areas: Free State, Evander, Elandskraal and Randfontein. The receipt and
payment of cash at Freegold and Armgold is outsourced to Teba Bank.
Teba Bank keeps an updated list of specimen signatures in the branches
where they pay out and receive cash from Harmony staff members.
Cash counts are performed on a monthly basis and reconciliations are
performed and independently reviewed at Central Services. Examples of
cash received would be the takings from the canteens; examples of
payments made would be the reimbursement of claims from staff
members, such as travel and entertainment expenditure incurred.
Page 10 of 48 11/10/2005
Petty cash is not maintained on an imprest system. A fixed amount of cash
is drawn each month to maintain the floats at the four Harmony locations.
3.1.2 Treasury
The Treasury function within Harmony is outsourced to Andisa, previously
known as Standard Risk and Treasury Management Systems. There is an
investment mandate in place with Andisa, which is updated on an annual
basis. The following functions are performed by Andisa:
Management of trust funds
Management of any hedge books and treasury products held
Market forecasts
Managing overdraft rates and negotiating interest rates
Transferring funds between the various bank accounts, at the
request of Harmony
Making foreign payments at the request of Harmony
Converting Dollars into Rands when required
Daily cash forecasting is performed internally. The amount of payments to
be made each day is monitored and when funds are required Andisa is
requested to transfer funds from the Treasury to the Call Account.
At month end Treasury provides exchange rates to Group Taxation and
Reporting for consolidation purposes. $/R exchanges rates are obtained
from the Bank of New York website and all other rates are obtained from
Andisa.
Harmony operates 51 bank accounts, two of which are in the UK. The
accounts are held with three of South Africa’s major banks.
Page 11 of 48 11/10/2005
3.1.3 Creditors and provisions
Creditors
The Creditors Department is responsible for processing payments for both
Services and Trade Creditors. Payments are made daily for certain
immediate payments, at fixed intervals during the month for certain trade
creditors and at month end for all other trade and service creditors.
Reconciliations are performed at month end. The Creditors Department is
also responsible for adding new vendors and making changes to vendor’s
details.
Provisions
Most provisions are generated at the shafts and plants or centrally. The
journals to be passed for provisions are e-mailed to Finance Operations.
The role of Central Services Finance’s is to ensure that the totals for shaft
and plant provisions balance back to Masterpiece at the end of the month.
Overhead provisions are performed centrally.
3.1.4 Other receivables
Other receivables would include amounts owing to Harmony from the
letting of residential and commercial property, contractors who may obtain
items in the stores and hostels utilised by contractor’s staff. Property
rentals make up the bulk of other receivables. Currently the process for
management of receivables from the letting of property is very manual and
is performed in EXCEL.
3.1.5 Accounts analysis, reconciliation and review
An independent review of the bank reconciliations is performed periodically.
Payroll and other reconciliations are performed by various staff members
within Finance Operations and Costing. Review of these reconciliations is
independently performed.
Page 12 of 48 11/10/2005
3.1.6 General Ledger maintenance
There are currently around 3,000 accounts within the system, of which
1,500 are inactive. The maintenance and control over general ledger
accounts is currently a manual process.
3.2 Group Taxation and Reporting
3.2.1 Month end reporting
The month end reporting process includes the preparation of the monthly
income statements and balance sheets for all individual companies.
Various costing allocation journals are passed at month end. VAT
calculations and intercompany analyses and tax packs are also prepared.
Adjustments are also made to provisions at month ends.
3.2.2 Period end reporting
The period end reporting process is very similar to month end reporting,
excepting that there may be share options issued, or dividends may be
declared during certain period ends. Interim financial statements are
prepared on a quarterly basis according to International Financial Reporting
Standards (IFRS).
3.2.3 Consolidations
The consolidated income statements and balance sheets are prepared,
based on information obtained from Masterpiece. This information is then
analysed and various entries passed to provide consolidated information.
Due to their secondary listing on the NY Stock Exchange, Harmony is
required to prepare one set of consolidated financial statements in
accordance with International Financial Reporting Standards (IFRS) and
another set prepared in accordance with US Generally Accepted Accounting
Practice (US GAAP). The Company Secretary is also involved in this
process. The consolidated financial statements are audited by the external
auditors at financial year end.
The financial statements are first consolidated per shaft, then per company
and then per group. There are several groups of companies that are
Page 13 of 48 11/10/2005
consolidated before being consolidated into the Harmony group. Foreign
subsidiaries use different financial software packages, which are not
incorporated into Masterpiece. As a result, most of the consolidation
function is performed outside of Masterpiece, including foreign currency
conversions into SA Rand.
3.2.4 Intercompany transactions
Loan accounts are maintained for all companies within the Harmony Group
for the purposes of recording all intercompany transactions. At month-end,
VAT is calculated and accounted for, for all the intercompany transactions
which took place during the month between the companies within the
Harmony Group.
3.3 Shaft and Plant Accounting
There is no fundamental difference between the financial operation of a
plant and a shaft. The financial function comprises of the following:
3.3.1 Monthly reporting
Each shaft is required to produce monthly financial reports. Reconciliation
of general ledger accounts is done and new shared costs are allocated from
Central Services Head office for shared costs are incorporated. Additional
reports are compiled for benchmarking against other Shafts and Plants, and
for comparison against rolling forecasts and budget year to date figures.
3.3.2 Journal processing
All general ledger entries from Shafts and Plants are currently done via
journals. Journals are e-mailed to a Central services mailbox to be uploaded
into the financial system. This includes all finance, banking and costing
journals.
3.3.3 Budgeting and forecasting
All shaft and surface operations are required to submit an Annual Strategic
Plan and 3 month rolling forecasts of their mining operations, expressed in
terms of hoisted tonnes of activity. Both activities (annual budget and
Page 14 of 48 11/10/2005
rolling forecasts) are Shaft team driven with the help of the Shaft
Accountant in translating the planned activities into financial terms. Input is
required from all departmental managers to generate budget and forecast
amounts per department and these are consolidated for the shaft/plant.
3.4 Capital accounting (Shaft and plant)
Capital projects are defined as projects where funds are utilised for
development of new ore bodies, further defining existing ore bodies and
related research and exploration cost. A feasibility study is done for every
capital project. Development of the project entails the sinking of a shaft or
the excavation if it is an open pit as well as the infrastructure necessary to
prepare the new ore body for production. Infrastructure includes process
and manufacturing facilities, major equipment as well as IT equipment.
Throughout the development up until production start the process is a
separate project handled by a project team that manages the physical as
well as the cost elements. A capital cost structure is assigned to the project
as soon as the project is approved. The capital costs incurred for projects
are written off over the life of the shaft as soon as production (revenue
generation) commences (estimated production period).
Harmony Gold requires a Capital Projects Software Management tool which
would manage current and “New Mine Capital Projects” to assist the project
team to monitor their actual progress against planned scheduling with
regards to the physical and cost elements.
Capital projects are embarked on only if they would increase the profitable
lifespan of a mine (shaft) or if they would increase the
efficiencies/effectiveness/capacity on the replacement or major repairs of
equipment. Although capital items are currently written off over the
lifespan of the shaft, this will change when IAS 16 comes into effect since it
stipulates that shafts be split into various components and depreciated
according to various methods applicable per component.
Page 15 of 48 11/10/2005
3.5 Fixed Assets
Fixed assets comprise Mining Assets which are made up of mine
development costs (exploration, project feasibility, project development,
development, major equipment, pre-production expenditure, IT equipment,
process and manufacturing facilities and development) and present value of
decommissioning costs as well as Non-Mining Fixed Assets which are
made up of land, vehicles, computer equipment, computer software,
furniture and equipment.
3.5.1 Capital expenditure
Capital expenditure for Mining and Non-Mining assets goes through a needs
analysis process before a capital expenditure application form will be
submitted for authorization. After approval the application will go through
the procurement process.
3.5.2 Amortisation and depreciation
Depreciation for non-mining assets (except for land which is not
depreciated) is on a straight line basis over their estimated remaining
useful lives. Mining assets are depreciated by the units of production
method based on estimated proved and probable reserves. Bond issue
costs and discounts are amortised by dividing the amount paid/incurred to
issue the bonds over the period they will be repaid.
3.5.3 Impairments
Each shaft/mine is classified as a cash-generating unit to assess whether or
not impairment has taken place. A strategic planning session is performed
at each shaft/mine where the remaining life of each shaft/mine is
determined.
3.5.4 Transfers and disposals
Transfers and disposals of Commercial and Residential properties have to
be approved by various departments.
Page 16 of 48 11/10/2005
3.6 Job Costing
3.6.1 Workshops
Specialist workshops are located in a widespread area. The workshops
respond to tenders issued by plants and shafts and include the
manufacturing of new equipment, repairs and rolling stock (reclaimed from
underground). Every tender will have a budget and daily costs e.g. Bill of
material and labour, will be recorded against the job. The foreman in each
workshop is responsible for planning, productivity, stock control and
assessing work-in-progress. If a tender was awarded for equipment to be
repaired, the workshops would render the service and would sell the
equipment back to the shaft.
4 Application requirements - Supply Chain
The Harmony supply chain facilitates the purchasing, warehousing and
distribution of goods, services and repairs for the Harmony (South Africa)
operations
4.1 Warehousing and Inventory Management
Inventory management and Warehousing functions are responsible for
replenishing and ordering of consumable materials; issuing/dispatching
materials to be used in the mines; receiving orders; packing of material in
the stores; conducting stock counts on a cyclical basis; transferring stock
between store locations and managing consignment stock in the stores.
4.2 Contract Management
Contract and commodity management is responsible for the optimisation of
the supply of materials, equipment and services through strategic
partnerships with suppliers, and it involves the management of all aspects
of a contract to guarantee that contractors fulfil their obligations.
4.3 Procurement
Procurement is responsible for the purchasing of materials and services that
are used on the mine. It encompasses the requisitioning of the required
Page 17 of 48 11/10/2005
item and the ordering either from the stores or from an external supplier.
Harmony inherited portions of services departments through their various
acquisitions; this has lead to various inefficiencies currently being targeted
for cost savings.
4.4 Vendor Management
Harmony is looking for an ERP system that has the functionality to enable
the supply chain team to manage vendors and interface with external
databases.
4.5 Catalogues
Harmony uses the process of cataloguing, which is an exercise of creating a
materials/ tools master catalogue from the data. The challenge going
forward is to maintain this catalogue using an ERP tool that will ensure the
elimination of encounters faced prior to the catalogue development as well
as provide the ability to methodically and visually enhance the product list
to increase customer understanding and participation.
Page 18 of 48 11/10/2005
5 Technical information
5.1 Masterpiece overview
5.1.1 Current Systems Structure Diagram
The diagram
5.1.2 Current System Structure
Masterpiece is a two tier system. It deploys its data on Ingres database
management system. Both Masterpiece Application and Ingres database
are residing on UNIX AIX platform. The current Masterpiece version is 1.2
and the vendor is SSA Global (www.ssaglobal.com). The system has
undergone a number of versions and the latest release is called SSA
Financials Management or SSAFM.
Page 19 of 48 11/10/2005
Masterpiece deploys data in OpenIngress developed by Computer
Associates (CA). It is a relational database management system.
OpenIngress supports all the SQL92 operators and QUEL.
5.1.3 Current systems – Interfacing with Masterpiece
Masterpiece Input from other systems
The payroll system feeds Masterpiece with six cost files and six deduction
files which are in the exact format required by Masterpiece. The process is
manual as indicated in the diagram below. The payroll system in use is
Palpay which is developed in COBOL. It is a flexible system which
predominantly uses batch processing. It mainly uses flat files.
Masterpiece Output to other systems
Masterpiece feeds the ABSA Server with binary files which are converted in
the ABSA bank required format by an in-house developed Visual Basic
program.
Data Warehouse extracts data from Masterpiece through an ETL called data
stage.
Any new area and process codes first get updated on Masterpiece then they
are extracted to the warehouse by the ETL. Data Warehouse updates both
the validation tables on Empower and Time & Attendance systems with new
area and process codes. The warehouse updates area and process codes in
the Palpay validation file in a flat file format.
On a daily basis, Empower updates Palpay and Time and Attendance,
updates any transfers and also feeds Palpay with clocking and overtime
information on a daily basis.
A daily payroll run get extracted to the data warehouse on a daily basis.
Page 20 of 48 11/10/2005
The Payroll system updates Masterpiece with high level information once a
month. This information should balance back to the cumulative daily
payroll information from payroll to data warehouse.
5.2 General system requirements
Harmony in line with its business strategy requires a standard centralised
and integrated solution for its Finance and Supply Chain management
processes, transactions and activities.
The required solution should have the following general functionalities:
Page 21 of 48 11/10/2005
It must be user friendly
It must be Windows based
It should have Drop Down menus – i.e. Allow users to select from
predefined criteria/list
It should automate manual calculations where feasible
It should enable users to export/import data to/from Windows Office
Suite e.g. Excel, Word, Access, etc.
Have a reporting dashboard
System interfacing – internal/external
Authorisation
Audit tracking
Batch & online processing
Faxing
Printers
The solution must be able to define the mandatory or optional
parameters for specified fields
Standard naming conventions should be used throughout the solution
e.g. customer on one form/module should also display as customer
(and not as client) on other forms/modules
User and system-defined references/codes must display
corresponding description/narration for clear understanding
Avoid duplication of data capturing activity
Page 22 of 48 11/10/2005
Cater for compliance with GAAP and Companies Act
Cater for compliance with the Sarbanes-Oxley Act with regard to built
in internal control structure
5.2.1 Integration
Integration should be across business functions/applications.
The system should fit into our new application environment. As the
database environment diagram above outlines, our systems are operating
in silos. We are using BizTalk server to provide seamless integration at
application level. The system should be configurable with Biztalk.
5.2.2 Workflow
The solution must be workflow enabled
An Audit trail must be available for all transactions and changes to
master data
The workflow facility must allow for electronic approval
5.3 IT Infrastructure
Harmony runs its own IT infrastructure which consists of 4 main regions,
Randfontein, Evander, Free State and Orkney. (Harmony has major shafts
at Elandsrand Carltonville and Kalgold in the North West Province). The 4
main regions are connected via redundant diginet backbone, with the other
major shafts being connected with single diginet links. The rest of 30 sites
are connected via wireless links in the form of RF radios. This entire
infrastructure is managed centrally from Randfontein by the Network
Infrastructure team.
5.3.1 Network technology
Harmony is currently engaged in the Network upgrade project, with one of
the main outcomes being the standardisation of all routers to the Cisco
Page 23 of 48 11/10/2005
Platform and Network switches to HP. RF Radios are being standardised on
Redline Radio’s
Network protocol
The network protocol is TCP/IP
LAN configuration
Layer II/III switching between broadcast domains
WAN bandwidth
Backbone Bandwidth capacity 5Mb; 2Mb ISP connection
Network Operating System
Windows 2003/2000; UNIX: AIX Solaris
Domain model
Windows 2003 Active directory and Exchange 2003 mail infrastructure
5.3.2 Database Technology
Masterpiece deploys its data on Ingres database. The Data Warehouse is
built on Sybase IQ. The payroll system uses a combination of flat files and
vision database.
Page 24 of 48 11/10/2005
Schematic Overview of our current database environment
Requirements
The system should utilize the existing database technology that Harmony
Gold has already invested on. We would prefer a system that would allow
Harmony to do database management systems consolidation without
difficulties.
5.3.3 Desktop Technology
The desktops range from Pentium 2 to Pentium 4. They use Microsoft
operating systems ranging from Windows 95 to Windows XP.
Page 25 of 48 11/10/2005
5.3.4 Hardware Platform
Harmony is standardised to Intel machines. IBM P630 is the current server.
The current Server Specification (This doesn’t have to be used).
IBM P630: Model: IBM P 630
Processors: 4 * 1.2 GHz
Memory: 2 Gigs
Network: 100mb Full duplex
Storage: External
Model: IBM FastT600
Total Storage: 417 Gb
5.3.5 Server platform
Masterpiece is currently running on UNIX AIX 5.2.
5.3.6 Programming languages
Vb.net is a standard language used to enhance and develop new systems in
Harmony Gold. The BizTalk environment has been developed with Vb.Net.
5.3.7 User-interface Requirements
The system should be user friendly and the fields on the forms should be
clearly defined. All mandatory fields should be clearly marked.
The system should have dropdown lists, look and feel, ease of use, online
adequate help, radio buttons and be web-based.
5.3.8 Security Requirements
System Access controls
User passwords must be encrypted
User creation should be done through active directory
Password history to be kept, to prevent re-use of the same
passwords
Page 26 of 48 11/10/2005
Sign-on Password Failure Limit feature – system should lock the
account after selected failed password guesses
Session Time out feature – users may leave their work station
unattended while logged into the system, making the system
accessible to others who may walk up to the computer
Ease of password change on seeded accounts – seeded accounts
password change should not affect the system’s functionality
The required length is a minimum of six characters with no maximum
limit
User authorization – should limit the user’s access to the
responsibilities that are assigned to that user
Auditing feature – should keep track of the user’s transactions in
order to verify that the user does not misuse his/her access
privileges
5.3.9 Application Security and Access Requirements
Harmony requires a solution to control access to information by creating
specific profiles based on the following rules/specifications:
No rights/Restricted rights
View /Read only
Create/Author
Change/Modify
Full control/Administrator/Owner
Special Permissions
Security down to account/field level
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Audit trails and logging to be kept
User-ID database and maintenance module of database
Role based security
Page 28 of 48 11/10/2005
APPENDIX A
ANSWER WORKSHEET
INSTRUCTIONS TO ALL RESPONDENTS
The information in this section should be completed by all respondents.
Please respond on this document in the space provided and adhere to the
numbering of the questions. Additional information in response to any
question can be included separately and referenced to the specific question.
6 Commercial information
6.1 Company information
Please provide your company profile specifically covering the following
aspects:
Name of company or Close
Corporation:
Company or Close Corporation
registration number:
Postal Address:
Street Address:
Telephone Number:
Fax Number:
Contact Person:
VAT registration number
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Provide a brief description of your core business and major users of your
services.
Response:
6.1.1 Your company structure
Shareholding
Provide Full Names of Shareholders/Members of your company by race,
gender and percentage shareholding. In the case of public companies,
please provide details of shareholders holding more than 10%.
Shareholder % Shareholding Gender
(F/M)
(where applicable)
Racial Group
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Management
Provide details of your organisational levels, the number, gender and race
of employees in each level.
Designation/
Organisational level
Gender and race
A/M A/F IM I/F C/M C/F W/M W/F
(Key: A= African, W=White, C= Coloured, I=Indian, M=Male, F=Female)
6.1.2 Details of your company’s board of directors
Director’s Name Executive
Director
Non-Executive
Director
Gender
(F/M)
Racial Group
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Director’s Name Executive
Director
Non-Executive
Director
Gender
(F/M)
Racial Group
Note:
Mark the applicable block with an X
Key for racial group: A=African; W=White; I=Indian; C=Coloured;
F=Female; M=Male
6.2 Strategic Partnerships and Alliances
Is your company willing to establish strategic alliances or partnerships for
the transfer of skills to Black ICT companies? If no, provide reasons why?
Response:
6.3 Financial Information
Audited financial statements for the last three financial years, where
applicable, of the responding company and the holding company must be
enclosed with your response.
Audited Financials for last three years submitted: YES/NO
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Provide name, address and contact details of your auditors.
Response:
Provide your bank details:
Bank name:
Branch name:
Branch code:
Address:
6.4 Solution functionality
Is your solution compliant with the Companies Act and GAAP?
Response:
How will your solution handle internal charges or intercompany
transactions?
Response:
How will your solution handle multiple currency transaction processing and
reporting?
Response:
Page 33 of 48 11/10/2005
How will your solution handle currency fluctuations?
Response:
Describe the features and functionality that your solution can provide for
General Ledger, Journals and Consolidations.
Response:
What is the minimum and maximum number of levels that your solution
allows for the chart of accounts?
Response:
How will your solution handle capital projects?
Response:
What functionality does your solution provide for Cash Management?
Response:
What functionality does your solution provide for Bank reconciliations?
Response:
Page 34 of 48 11/10/2005
6.5 Experience
How long has your organisation been in business?
Response:
Provide specific experience and credentials with similar organisations,
where these are believed to be relevant.
Response:
How many years’ ERP implementation experience do you have in either of
the following products within South Africa?
MS Axapta
SAP
Oracle
Response Years’ experience
MS Axapta
SAP
Oracle
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How many ERP implementations have you done in the mining industry?
Response:
How many ERP implementations have you done in the mining industry,
specifically, in either of the following products?
MS Axapta
SAP
Oracle
Response Number of implementations in mining industry
MS Axapta
SAP
Oracle
Do you have a proven methodology and approach to your ERP
implementation? Provide details of such methodology and approach.
Response:
What is the composition of the team involved in your ERP implementations,
their level of expertise and experience? (Please provide profiles of the core
team that your company uses for ERP implementations).
Page 36 of 48 11/10/2005
Response:
What is your level of certification with respect to the proposed software?
E.g. Gold, Silver, etc.
Response:
How many of your consultants are certified in the implementation of the
proposed software?
Response:
6.6 Customer Base
How many ERP solution customers does your company have?
Response:
How many active solution customers do you have?
Response:
Page 37 of 48 11/10/2005
Across your customer base, how many ERP solution sites does your
company have?
Response:
What is the average size of your customers for whom you have done ERP
implementations?
Response:
Is there an active user group for your solution in South Africa?
Response:
When was this user group established?
Response:
How many of the solution customers are on your maintenance plan?
Response:
6.7 Sub-contracting and Joint Ventures
How many parties, including the implementation partner, is your company
proposing to use as subcontractors, joint venture partners or consortium
members?
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Response:
List the names of these parties.
Response:
Has your company worked with any of the proposed partners in prior
engagements? If yes, list those that you have worked with before and the
number of projects in which you used their services.
Response:
6.8 Black Economic Empowerment
Respondents must state their involvement in SMME development, of
particular interest would be any actions that specifically promote Black
Economic Empowerment. For the purposes of this RFI, BEE refers to
Economic Empowerment of Black, Indian and Coloured individuals.
Respondents that are merely acting as agents who do not add value and
who are merely used as marketing channels for established white
businesses will be effectively prevented by the process - i.e. not being
entitled to preference unless it can be proved to the satisfaction of the BEE
Page 39 of 48 11/10/2005
Coordinating Council that this “agency-ship” is part of a legitimate
upliftment program.
An agent is defined as a representative who works/ acts on behalf of the
company he represents and whose existence is for the sole benefit/
convenience of the company he represents. In the event that an agent has
no shareholding in the company he represents, works for a fixed salary and
does not form part of any legitimate upliftment program the said agent will
not be entitled to the full preference.
Where the agent has shareholding in the company he represents, is not
earning a salary and his inputs/ contributions add value, he will be entitled
to preference depending on his percentage shareholding in the company he
represents.
Preference would be given to affirmative companies in the adjudication of
this RFI. Documentary proof to support your scoring for all criteria
in the table below must be returned with the RFI submission.
Please indicate your BEE status by ticking the appropriate boxes below and
also indicate the actual BEE percentage of shareholding in your company.
BEE Representation (Please tick one of the boxes below) Criteria
< 25% 25-50% 50%-75% 75-100%
1 Shareholding
2 Management
3 BEE procurement
spend
Not
planned
Planned, not
implemented
Implementation
in progress
Implementation
complete 4
BEE Programme
(including skills
transfer)
Page 40 of 48 11/10/2005
6.9 Support and maintenance
What is the structure of the support and maintenance that you provide for
ERP implementation?
Response:
Where are your major on-going support and maintenance facilities located?
Response:
Are your on-going support and maintenance facilities staffed by your
company or your partners?
Response:
Provide the certification level achieved by the Support and Maintenance
service provider, where support and maintenance is provided by a party
other than the Software Vendor.
Response:
6.10 Technical
What are your technical requirements as far as ERP implementations are
concerned?
Response:
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Provide, at least, three reference sites where the solution has been
successfully implemented.
Response:
How will your solution enable electronic authorisation of transactions in line
with internal company policies?
Response:
Explain how your solution interfaces with Web-based applications?
Response:
Explain how your solution would interface with banking and cash
management systems?
Response:
Does your solution provide for document image processing for storing
incoming and outgoing correspondence generated by the system and
independent sources? If so, is it a separate component or a built-in
component of your solution?
Response:
6.11 Solution pricing
Provide your solution pricing strategy.
Page 42 of 48 11/10/2005
Response:
6.12 Training
Describe your approach to training?
Response:
Who will deliver the training? Is it the Software Vendor or the Implementer or a third party?
Response:
Is the training delivered at the client site or at your corporate office?
Response:
Is the training curriculum generic or will it be tailored to the specific implementation requirements of Harmony?
Response:
6.13 Legal requirements
Provide details of you attorneys or legal counsel.
Page 43 of 48 11/10/2005
Response:
Is there any pending merger or acquisition in the pipeline that may impact
your company's ability to deliver ongoing service to Harmony?
Response:
Is your company a subsidiary of a larger entity? If so, which entity?
Response:
Provide details of any recent mergers or acquisitions involving your
company. What were the reasons for the merger/acquisition? What is the
potential impact of the merger on your business going forward?
Response:
6.14 Tax clearance
Supply a valid Tax Clearance Certificate for your company and for your
strategic alliances who will be working with you on the project.
Respondent’s Certificate supplied: YES/NO
Strategic Alliances Certificate supplied: YES/NO
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6.15 Software Vendors’ Questionnaire
Only the Vendors for MS Axapta, SAP and Oracle should respond to
this section.
6.15.1 Product Strategy How many major version updates did your company release per year during
the past five years?
Response:
How often are you planning to release major version updates in future?
Response:
Are you anticipating a major upgrade within the next year?
Response:
Provide details of your next three major functionality enhancements and
the expected dates on which they would be deployed.
Response:
Page 45 of 48 11/10/2005
What is your company's product pricing strategy?
Response:
Provide details of any planned architectural enhancements to your product?
Response:
Does your company fulfill customization requirements or do third-party
companies take care of customization?
Response:
Supply details of company’s latest product release and when was it
released?
Response:
Define the following terms: solution site, solution customer, user groups
and customer installation, in the context that they are used by your
company.
Response:
Page 46 of 48 11/10/2005
APPENDIX B - Acknowledgement
I/We……...........................................................................................of
................................................................................hereby submit a
response to the Request for Information on the implementation of an ERP
system for Harmony Gold as described in the RFI document.
I/We confirm that I/we have read and understood all the documents
provided by Harmony Gold in the Request for Information. I/we have
drawn my/our own conclusions from these documents.
This Response is submitted in accordance with the Request for Information
(G428/05) by which I/we agree to be bound.
[Please confirm that you have received and have read and responded to the Request for Information document and the supporting appendices and that the information/response that you have provided is correct. Please complete this checklist ticking the relevant block with an X and submit with your response.]
Section heading Read Responded
RFI Overview – Sections 1 to 5
APPENDIX A: Commercial information - Section 6
Company information – Section 6.1
Strategic Partnerships – Section 6.2
Financial Information – Section 6.3
Solution Functionality – Section 6.4
Experience – Section 6.5
Customer Base – Section 6.6
Page 47 of 48 11/10/2005
Section heading Read Responded
Sub-contracting and Joint Ventures – Section 6.7
Black Economic Empowerment – Section 6.8
Support and Maintenance – Section 6.9
Technical – Section 6.10
Solution Pricing – Section 6.11
Training – Section 6.12
Legal Requirements – Section 6.13
Tax Clearance – Section 6.14
Software Vendors’ Questionnaire – Section 6.15
APPENDIX B - Acknowledgement
Page 48 of 48 11/10/2005
I/we hereby acknowledge that I/we have received and responded to the
sections listed in APPENDIX B above.
My/Our response will remain valid for a period of 180 days from the closing
date. I/we acknowledge that it cannot be withdrawn within the stated
period.
Name of company representative
Signature
Capacity or Designation
Company Seal/Stamp
Company Telephone
Company Fax
Contact person
E-mail is the preferred medium of correspondence for any questions, or comments and the email address is erp@harmony.co.za.
Note: This opportunity may not be discussed with any other Harmony Gold personnel (management or staff). Doing so may disqualify the Respondents from further participation in the opportunity.
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