The political controversy that has accompanied the confirmation of John Lamola as SAA’s CEO is unfortunate. But it shouldn’t be allowed to distract Lamola from the key task of turning the national airline around.
Since news of his impending appointment first leaked, political parties and interest groups have rushed in to criticise the decision to appoint him as CEO.
The DA, the ANC’s partner in the government of national unity, has approached the public protector to investigate how Lamola made the cut.
Leaks suggest that Lamola, who had been acting CEO before his elevation, was number three in the list submitted to cabinet. It’s further claimed that Luthuli House, which still practices cadre deployment, hand-picked Lamola over the two who scored higher than him.
The truth may only be revealed in litigation.
Deputy president Paul Mashatile and Barbara Creecy, transport minister and the so-called shareholder representative, are believed to have been behind the move to airdrop Lamola.
This controversy is a sideshow. It is embarrassing to Lamola that he wasn’t a strong candidate according to the board-run recruitment process.
The controversy, however, ignores realities that are facing SA’s struggling state-owned enterprises (SOEs) including SAA.
First, while it is desirable that boards should run CEO selection processes, the reality is that the state, as the shareholder, has the final say on who gets appointed. SA’s SOEs are littered with examples of appointees who were appointed without being recommended by their boards.
Second, this is not unique to the public sector. It also happens in the private sector. The other dynamic that tends to influence decisions is the issue of remuneration. External candidates tend to demand higher packages than internal ones.
Third, as an internal candidate who ran the company, Lamola enjoyed an advantage over the other candidates. In the end, the government must have picked him because he was a safe bet with inside knowledge of the workings of the company.
Fourth, most of the SOE top jobs are about managing impossible expectations and meddling of politicians who hardly understand the businesses. This is why good candidates from the private sector do not even bother to make themselves available for any of these roles. External candidates would have battled with keeping politicians in their lane.
Last, even though the process resulting in his appointment may have been poor, his short stint at SAA has been encouraging. The airline, which was on its knees, is expanding its fleet and opening new routes.
That said, Lamola and his board need to focus on turning SAA around. The company, today a fraction of its former self, has been through a lot. After its collapse, its shareholders tried and failed to bring in private investors to end the legacy of bailouts.
The interim team has to be applauded for its early wins. Like most SOEs, SAA’s demise benefited its rivals. Domestically, FlySafair has been a major beneficiary of SAA’s failure. Few of SA’s well-regarded pilots battled to find jobs elsewhere, especially after the Covid-19 pandemic.
Lamola now needs to continue attracting them back, probably at huge cost. This will not be easy. But it is possible. He needs the support of his board and the shareholder. Crucially, he needs to be given a chance to continue resuscitating the airline.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.