Hogg and Simpkins consider what Eskom and the ASA taught us about communication.

Note to readers: Since this podcast was done Jacob Maroga has been reinstated as CEO of Eskom and Bobby Godsell has resigned  

ALEC HOGG:  In this week's Boardroom Talk podcast Clive Simpkins, the country's leading communications strategist is with us in the studio - because it really has been a week of communication blunders.  Clive lets perhaps kick off with perhaps the one that's most important to the country - Eskom and the whole departure of the chief executive Jacob Maroga.  It started last week with rumours...

CLIVE SIMPKINS:  The astonishing part of it is that as we sit here it is still not fully resolved.  Every half hour different media reports come out, indicating that there is a letter of resignation, or there isnt.  And for me the absolute insanity was the fact that last night for example, they had Julius Malema speculating and being the spokesperson on behalf of the ANC on the issue.  What amazes me more than anything is the fact that this is happening on the watch of a very august competent person, in the form of the chairman of that board at Eskom, Bobby Godsell.  That astonishes me because Bobby has a track record of having been a person who was able to mediate, conciliate, bring warring factions in unions together and the fact that this has turned into the mess it has, leaves me quite astounded.

ALEC HOGG:  And with fingers being pointed at him - just as an aside I remember speaking to Peter Monk the founder and chairman of Barrick - he told me that he had been trying to get Bobby Godsell to join him for years, but Godsell had said no - he's a committed South African and he turned down many riches - well he could have made a whole lot more money - and clearly if there was any inclination to leaving the country, he could have gone there.  So this is a man who is dedicated to this country, is trying to do his best for South Africa  and is now being painted as a scoundrel by the likes of Mr Malema.

CLIVE SIMPKINS:  What I find very interesting is that Jacob Maroga's track record inside of Eskom is a very credible one.  He is very liked by the people in Eskom.  If I'm correct, he came from the transmission side and he's apparently done a sterling job over the years, so I find this quite fascinating that suddenly he has become the whipping boy for Eskom's ills.  My view is that if anybody should have been on the chopping block, it should have happened some time back and that someday should have been Thulani Gcabashe who was the previous CEO.  So I don't understand how all the ills have somehow accumulated now and have landed in Jacob's lap.

ALEC HOGG:  But lets just go into the whole way it's been communicated, or not been communicated.  Perhaps the most critical thing is if you are going to call a press conference, have it - don't cancel it half an hour before...

CLIVE SIMPKINS:   I would agree and to give the excuse - and again, it's Bobby Godsell - that he had to rush off to a meeting, as I understand it.  That's incomprehensible - in the financial markets in which I'm not literate, but you are extremely so, uncertainty is something that nobody likes.  In the world of communication, it is exactly the same.  I was reading today, that Moody's for example, the ratings agency, are watching this with great interest.  So if Eskom are looking at some incredible figure, is it R385billion that they're looking at for power stations over the next number of years...

ALEC HOGG:  ...it depends who you talk to but it certainly is in that ballpark...

CLIVE SIMPKINS:  A vast sum of money.  This is certainly not the way to instil confidence in potential investors because this right now, is running around like a headless chicken and it follows on the heels of similar indecisive poorly communicated things like Siyabonga Gama at Transnet, for example.  There seems to be a track record...  I don't know who at governmental level is to blame.  I can't believe it's Barbara Hogan who is very new to the portfolio as Minister of Public Enterprises, but this needs to be reined in - it needs to be fixed.  Eskom is a case in point I believe - I don't want to mention the name, but I know have a very good public relations consultancy - very highly rated - who consult them.  But somehow or other, they've gone the old Boere-idiom route of ‘you've got a dog but you're sitting on your own stoep and barking', which makes no sense.

ALEC HOGG:  You mention government departments, or quasi government organisations - we were going through a list this morning - we have an acting chief executive at South African Airways, we have an acting chief executive at Transnet, we have no chief executive now at Eskom - on many of the other major public utilities, it's in a similar situation.  It's almost as though people in government are a little afraid to appoint somebody on a permanent basis...

CLIVE SIMPKINS:  What I find particularly astonishing, is if you took two enterprises - one being the railroad infrastructure for example, and transportation - let's call that Transnet for want of a better label right now, and electricity - I can't think of two that play a more critical strategic role and yet we've allowed them to fall into this kind of pandemonium.

ALEC HOGG:  The point you made is a very good one - that many people might have missed - but Eskom needs to borrow a lot of money internationally.  It's credibility is closely linked to the price that it will pay for that money ie, the interest rate and the way things are going right now, it might be paying a few percentage points more than it might otherwise have to.  So communication and strategic communication in this case, is going to cost them.

CLIVE SIMPKINS:  It is and it comes back to something you and I have discussed on air several times, and that is the failure of the people who should react quickly enough upfront to do so.  They leave it and I'm afraid the snowball phenomenon - clichéd though it may be - as it goes down the mountain it grows bigger and moves faster and it creates more damage when it hits something.  So the lessons to be drawn from this are - it's time for President Zuma to actually take somebody, I think like Trevor Manuel frankly and give them a mandate to start pulling the stuff together and making it work. 

ALEC HOGG:  Just to dwell a little on the political side - Julius Malema is a loudmouth - we know that.  He certainly hasn't expressed terribly cerebral opinions on a whole range of issues, and he is once again putting his foot in it here, and getting involved in an area where one would think a logical person would stay away from unless you really did understand the background to it.  I heard a theory the other day that he is being used by the ANC as an agitator - as someone to just stir up the nest and in fact he told a person that I know quite well, that this is the way he sees his post as well.  Is that a wise thing to do in a society like ours where you do have 25% unemployment and an agitator can quite quickly lay fertile ground for someone who perhaps has worse intentions for the country as a whole?

CLIVE SIMPKINS:  Bottom line in my view, and Archbishop Desmond Tutu postulated this a long time ago, when he said the rainbow nation is in fact a myth these days - it's a farce and it's a fraud.  I believe the ground is being very carefully laid for a real social upheaval at some point and when you have people like Julius Malema who may not be an intellectual, but my goodness he is streetsmart, and he understands how to work people and he is - I would use the word cunning - so there are some powerful instincts there.  He follows the tradition - in the form of Peter Mokaba and Fikile Mbalula - his predecessor as the head of the ANC Youth League - there is almost a stereotype that leads the youth league and it is that anarchist, it is that loud mouth, it is the person who makes intemperate statements.  I don't know if they consciously choose someone like that or not...

ALEC HOGG:  Well it reminds of a little of Adolf Hitler who was no intellectual genius but a loud mouth and an orator of some note... look where he took Germany!

CLIVE SIMPKINS:  Yes - one must not, for one moment, underestimate the influence that Julius Malema has.  I've read some insightful articles from people who have met him and have been to his office and have watched the system of patronage and leverage and how he gathers information on people within the ANC and uses it to his advantage and the statement these days, is if you want something done and you want it done quickly, go and see Julius.

ALEC HOGG:  So why is he putting his nose into the Eskom affair?

CLIVE SIMPKINS:  I think Julius is simply positioning himself fairly adroitly in terms of sticking in his nose everywhere, and if the ANC doesn't speak on stuff, then the ANC Youth League seems to have seen it as an opportunity for them to do so.

ALEC HOGG:  The other big issue as far as communications is concerned, is the goings on at Athletics South Africa.  Chuene has now been fired - was this a surprise?

CLIVE SIMPKINS:  Not at all - it should have been done ages ago.  You cannot lie to the public when you hold office of that sort.  The credibility of that institution is at stake.  The board is suspended, as I understand it because there seems to have been some degree of complicity in the scenario.  Again, what happened there, exactly what's happened at Eskom.  It was a communications cock-up.  There's no other word for it.  A failure to actually clarify early enough, complete absence of honesty - bottom line...

ALEC HOGG:  So what would you have done in both cases if you had been consulting to say, Bobby Godsell and to Jacob Maroga at Eskom, and then to Chuene at Athletics South Africa?

CLIVE SIMPKINS:  Single recommendation is for goodness sake, sing off the same song sheet.  Don't have lines of communication coming from four or five different sources that are totally at odds with each other, and do not lie to the public in any shape or form - because given social media, given the invasiveness of investigative journalism of the kind that you offer the public, that stuff will see the light of day at some point...

ALEC HOGG:  Clive Simpkins, communications strategist.

The SAfm Market Update with Moneyweb is broadcast on SAfm 104-107fm, weekdays at 18:00 to 18:30.

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