The graph below plots a company’s competitiveness, where the desired position is in the left upper segment, which indicates a company which has become more competitive through productivity improvements compensating for price under recovery. The cumulative ten years’ (each point) sets of values of productivity and price recovery reflects Eskom’s results over the past ten years.

The weighted average clearly shows Eskom’s advantageous competitive position though the recent performances show a downward trend. Productivity improvement over this period has contributed substantially towards absorbing the impact of inflation on the business. However the impact of productivity decline and price under recovery is becoming burdensome to the business due to Generation capacity constraints.

The productivity results have been reviewed by Productivity South Africa. The review included an examination of the structure of the analysis, the appropriateness of quantity and price drivers, the accuracy of the model and the presentation of the results. In the opinion of Productivity South Africa, the productivity methodology captures the overall performance of Eskom the 12-month period ended 31 March 2008.