QUESTIONONE

For anyone considering doing business in Uganda, think ROKO. ROKO ConstructionLimited was founded in 1969 and is today one of Uganda's leading Construction andCivilEngineeringGroups. ThelateMaxRohrerandRainerKohler, with50yearscombined experience in Africa, made a commitment to assist in Uganda's prosperityand development when they founded ROKO. Together with technical and commercialdirectors and over 40 qualified civil and site engineers, Rohrer and Kohler led ROKO tothe forefront of the construction industry to emerge as the principal contractor inUganda, and by 2001, we operated only in Uganda and Tanzania but Uganda has nowdeveloped to be a hub for activities in neighboring countries and we have now heavily investedinRwanda, EasternCongo,KenyaandSouthSudan.ROKOConstructionLimited had groomed into a self-sufficient company in the majority of constructiondisciplines and provides employment for an average of 1800 people, placing greatemphasis on training its technicians and craftsmen to produce an exceptionally highstandard of workmanship. Materials are produced locally and from the PreferentialTrade Area wherever possible, and imports are facilitated by ROKO's association withtheSAITradingCompanyinEurope.Thecompany hasawidevarietyandquantityof earthmoving and construction equipment available, including traxcavators, bulldozers,dumptrucks, compactors, dragline/cranes to execute most types of Civil/Road works,together with all equipment necessary for general construction of high-rise buildings. Facilitiesavailableinclude AdministrationOffices atCentral,Central PurchasingOperations Base, Carpentry Workshop (Kawempe, Kampala), Mechanical Workshop,Plumbing&ElectricalSections, Pre-Fabricated&Pre-cast ConcreteProduction,ReinforcingSteelCutting&Bending,StructuralSteelFabrication,Aluminum Production Workshop.With all the good projections about the company, Roko owesRoofings Ltd sh2b after the latter supplied the former with steel materials that it usedat various construction sites, but failed to pay for owing to financial challenges. Theengineers, under the Uganda National Association of Building and Civil EngineeringContractors (UNABEC), in their letter to finance minister Matia Kasaija, requested the Governmentto bail outRoko because this would save many other contractorsandjobs."BeingtheleadingconstructioncompanyinUganda, hundredsofsmallandmedium-sizedcontractorsandsuppliers willgodownwithRoko.Itsclosure wouldalsomean that3,400Ugandanswill lose jobs,"theywroteon December16.

TheUNABECnational president,FrancisAryatuzooraKaruhangaandexecutive directorElizabethMuhebwa signedtheletterthatwascopiedtotheOffice ofthePrime Minister, works and transport ministry as well as the Private Sector Foundation.The association said Roko currently holds a portfolio of sh740b in value of works fortheGovernmentandprivate sector.Itappealed totheGovernmenttogivetheconstructionfirmatleastsh120btoavertitscollapse.Theengineerscitedtheextension of the Parliamentary Building and the new finance ministry building as some of the works Roko is currently undertaking. Documents seen by New Vision show thatRokohasatleast18ongoing projectswithbothpublicandprivateentities thatowethe construction firm $205.7m. "As a constituent of the engineering sector therefore,we believe that the failure of Roko will unravel unprecedented reckoning against the(construction) sector's advancement in Uganda," the engineers said. The engineers'appeal, however,comesatatimewhentheGovernmenthascommittedtopayRoko an outstanding debt of sh46.9b that the State owes it for the different contracts it hasexecutedovertime.

ThiswasafterRokowrotetotheGovernmentseekingtohavetheirmoneypaidsoasto solve the cash flow challenges that have affected its operations. Just like many other companies, Roko's businesses were affected by the COVID-19 lockdown. In aletter to the Roko managing director dated November 20 this year, Kasaija expressedtheGovernment'scommitmentinwritingtopayRokowithinfourmonths."Lack knowledge receipt of your correspondence in which you brought to my attention thelongoutstandingpaymentsamountingtosh46,997,280,913.80duetoRokoConstruction Limited,and recognize the sameas contributory to yourcurrent cashflowproblems,"hewrote.Theminister,however, saidtheywerestillcarrying outverificationoftheoverdue paymentswiththerelevantgovernmentagencies.Theminister urgedthebankstoofferRokothenecessarysupport toenabletheconstruction firmtomeetitsobligationswithitsclients.

REQUIRED

1. With evidence derived from the case, identify the least two competitive prioritiesforROKOConstructionLimited.(10 marks)

2. Assuming the government bails out the company as requested, identify withreasons the preferred layout for the company that will enable the company toachieve its strategic objective of being the Leading Construction Company in theCountry. (10marks)

3. Whatarethestrategic challengesassociatedwiththelay-out arrangementpreferredin(2)above(10marks)

4. When designing a suitable lay-out, certain principles must be considered beforecoming up with the design. As the Operation's manager, identify any five (5)principlesthat youwouldconsider.(10marks)