SAA is set to get its sixth chief executive in 14 years following yesterday’s news that Siza Mzimela was stepping down from the executive leadership of the troubled national airline.
Mzimela was appointed from SA Express in February 2010 to replace Chris Smith who had been appointed as acting chief executive for one year following the dramatic departure of Khaya Ngqula in early 2009. Mzimela has served as SAA chief executive for two years and eight months. This is just four months short of the three-year average tenure of the past five chief executives.
To the extent that there is a recommended “average” tenure period for chief executives it is deemed to be a period of at least five years. But this five-year recommendation is for private sector companies that have a history of stable management and continuity of leadership.
While there are conflicting reports of Mzimela’s effectiveness as a chief executive, her departure raises significant concerns because of the context in which it occurred. Most immediately is the recent dramatic resignation of former chairwoman Cheryl Carolus and seven of her board directors.
As with the eight former board members Mzimela also cited difficulties in dealing with the stakeholder representative, which is the Department of Public Enterprises.
In addition to a relatively short-tenure period, a common characteristic of the departures of the five former chief executives is that, with the exception of Smith, they have been followed by controversy.
After just over three years as chief executive, Coleman Andrews left SAA in 2001 amid much controversy about the R200 million-plus remuneration package he had secured from Transnet’s remuneration committee. The controversy surrounding his remuneration package and the multibillion-rand order for 21 new planes effectively obscured consideration of any benefits Andrews’ reign may have had for the ailing airline.
Andre Viljoen, who had been SAA’s chief operating officer, was appointed to take over from Andrews in 2002. His tenure was marked by considerable controversy over the heavy losses SAA suffered in relation to its R6 billion hedging position. Viljoen’s tenure was also overshadowed by high-profile cases before the competition authorities, where it was ruled that SAA had illegally used its position of dominance to attack the smaller players in the market.
In August 2004, Ngqula was appointed to replace Viljoen with a contract that was to run until 2010. The ever-controversial Ngqula was an aggressive hands-on manager and in 2007 launched an ambitious restructuring programme. But by October 2008 Ngqula, who received a total remuneration package of R20m for his four years at SAA, was out in the midst of allegations of mismanagement. Following his departure SAA took legal action to recover funds deemed to have been inappropriately spent on Ngqula’s instruction.
Mzimela, the first female chief executive at SAA, replaced Ngqula. – Ann Crotty