With the announcement by Pick n Pay of German retailer Pieter Boone as the replacement for retiring incumbent Richard Brasher, it struck me that SA retailers have had more than their fair share of foreign CEOs over the years.
The results have been mixed, with no clear indication that the foreign appointees have done consistently better than their local counterparts. Only Clicks and Pick n Pay can honestly say that their foreign CEO appointees have been consistently successful.
There is lots of local talent, but the old belief that imported product is better than local remains. Local talent is just not promoted, despite knowing the market better. It’s an indictment on SA retail management that they don’t encourage and nurture home-grown talent.
Edcon didn’t have an SA-born CEO from 1998 until its demise in 2020. American Steve Ross, who rescued Edcon in the late 1990s, did an outstanding job. But in retrospect, he lost the plot with the ill-fated leveraged buyout of Edcon in 2007, just before the global financial crisis.
A German called Jurgen Schreiber, who took over from Ross, compounded the misery. After Schreiber came an Australian called Bernie Brookes, who managed to stabilise the firm to an extent before handing over to the final CEO, Zimbabwean-born Grant Pattison.
Ross achieved a huge amount in his first 10 years as CEO at Edcon, helped by not bringing any emotional baggage to the group. But he blew it with the leveraged buyout and accompanying unsustainable debt, from which Edcon never recovered.
Though he refers to himself as Australian these days, former Woolworths CEO Ian Moir comes from Dunfermline in Fife, Scotland. Moir inherited a really clean business from previous CEO Simon Susman and in his early days in the job didn’t put a foot wrong. But he got carried away with the idea of establishing one of the world’s great department store groups and overstretched Woolworths by buying Australian department store chain David Jones. Unable to turn David Jones around sufficiently, Moir was replaced as CEO in 2020.
Then there was the strange case of Jean-Christophe Garbino, a French businessman who was appointed to succeed Michael Mark as CEO of Truworths in 2015. But for reasons known only to Mark and the Truworths board, Garbino never took up the position of CEO and resigned after only a few months. Mark is still CEO, having held that position for 31 years.
In September 2019, Walmart appointed Mitchell Slape as Massmart CEO in a last-ditch attempt to save the business. Slape is an American and Massmart shareholders are hoping he can emulate fellow American Ross’s initial success at Edcon over 20 years ago. There are nascent signs that Slape’s turnaround strategy is having some success, but it will take time in the gruelling post-Covid world to demonstrate if that is indeed the case.
Clicks appointed Englishman David Kneale, a long-time Boots executive in the UK, as CEO in 2005. At that time, Clicks was in a bad state, with no proper management information systems. Kneale turned the business around quickly and kept it on an even keel for 13 years until he stepped down in 2018.
The list of “foreign” retail CEOs wouldn’t be complete without fleeting reference to Doug Murray of TFG and Alastair McArthur of Mr Price. Both born in Scotland, they spent their entire retail careers in SA, so theirs were not really foreign appointments.
Pick n Pay are no strangers to foreign appointments. Apart from Boone and Brasher, the board also appointed German Helmut Hoerz as head of merchandising in 2012. Brasher has left big shoes to fill and Boone will have his work cut out on a very steep learning curve once he takes over as CEO in April.
He will need to recoup profitable market share from Pick n Pay’s old rival Shoprite while maintaining its new super-slim cost base that he has inherited from Brasher. And all within the difficult confines of a Covid world. It’s a tall order.
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