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Stemming SAA’s losses a priority, says Vuyani Jarana

Incoming CEO gives detail on the state asset’s turnaround plan.
Vuyani Jarana has joined SAA on a five-year contract and believes that strong business skills execution capabilities will help him turn the state carrier around. Picture: Supplied

WARREN THOMPSON: Joining me now, in possibly the toughest job in the country, is the new chief executive officer of South African Airways, Mr Vuyani Jarana. Good to speak to you, Vuyani.

VUYANI JARANA: Good afternoon, Warren.

WARREN THOMPSON: You’ve just put your feet under the desk there, so I’m not going to go into too much detail about what you plan to do yet but perhaps you can start off by telling us about your personal process that you’re going to undertake as the leader of the organisation to get a sense of what you need to do. Perhaps you can explain how you are going to go about your job and then obviously at some point in the future we’ll have a much better idea from you as to what you need to do. But perhaps if you could give us a little bit of a lead as to what you anticipate doing in the next few weeks and months as you get to know the airline.

VUYANI JARANA: One of the key things that’s important is to realise that at SAA there is a turnaround strategy that has been developed and it’s in place. So what I’m busy with now is to test some of the assumptions in that turnaround strategy, to look at the roadmap for implementation. Obviously one of the key elements of that is listening to the people of SAA, making sure that I get their views, I also understand what their take is on the strategy but most importantly, we have to develop a very clear execution framework to make sure that we can actually deliver on the plan. So far stress testing the strategy that’s in place, understanding the culture, listening to people’s views inside SAA and in the next couple of weeks we’ll be developing an execution model that will be inclusive, it will include all the people of SAA.

WARREN THOMPSON: When do you plan on having that completed, Mr Jarana?

VUYANI JARANA: I would hope to have a bit more time to diagnose and study, it’s a very big and complex organisation, and there are people here who have done a lot of work in this, so I’m hoping that within the first 100 days I would have done the full diagnostics and developed an implementation plan, which I’ll share with the stakeholders. Of course, the board will be very important. The board has been reconstituted and we still have to focus on that as well to make sure that they understand the strategy and are also part of the implementation and governance.

WARREN THOMPSON: There are a number of priorities that you are going to have to deal with sooner rather than later; I imagine executive appointments will be up there. You’ve got a chief restructuring officer who has joined you but how many other key executive appointments are you hoping to fill in the coming months?

VUYANI JARANA: We already have a number of those roles being advertised, there are four key roles that have been advertised and we are doing interviews for roles like chief commercial officer and three other roles. So the big focus is to make sure that we stabilise the organisation and bring capacity where necessary to execute on the plan because only when you have strong capabilities on the inside can you execute the plan. So we’re focusing on filling vacancies and stabilising the organisation but a big part of it is really going to focus on liquidity and cash flow management to bring back liquidity in the business.

WARREN THOMPSON: Have you had the chance yet to meet with any of your funders or any of the banks that extend credit to the airline yet?

VUYANI JARANA: I’m only seeing them next week, I’m meeting the lenders next week.

WARREN THOMPSON: One of the other key objectives that you’ve probably been tasked with is finding a strategic equity partner. I imagine that would probably take a backseat for a little while, while you stress test the turnaround plan and make those executive appointments but would that be something that you’d be looking at in the new year?

VUYANI JARANA: The minister did make an announcement during the Mid-Term Budget Policy Statement about the decision [to bring in a] strategic equity partner for SAA. But obviously the big focus is really bringing the business back into shape as quick as possible and then to look at the issues of consolidation of state aviation assets, including SA Express as part of the roadmap, the board will then consider and make a decision about what it means to bring a strategic equity partner. So there’s a bit of a runway we have to take before we get there. The big ticket item today is really to focus on stemming the losses, we have a number of initiatives that are in the turnaround strategy that I have to execute on.

WARREN THOMPSON: You are obviously a man who enjoys a challenge; you had a successful career at Vodacom, what are the specific reasons for taking this job?

VUYANI JARANA: Many people have asked this question and others have written open letters to me, which I really appreciate. I think South Africans will realise that SAA is a flag carrier, it’s almost like an embassy in the sky. I indicated earlier on that when South Africans travel globally, myself included, when I’m away for more than two weeks and when I get back to Heathrow or any of the international airports and I see the tail I feel like I’m home away from home. So that’s the power of the brand, the sentimental value, so when you have a situation where a strategic asset for the country is having difficulties and when there’s a call-up for any of us to join we should not sit in the comfort of the private sector when we are being called up to join, we should come and join and be part of the team that is going to save the asset and that’s what I’ve done.

WARREN THOMPSON: In particular, what skills do you think you will be bringing to the table for SAA and the country?

VUYANI JARANA: Very strong business skills, very strong execution capability, I come from a technology background, I have a deep appreciation of technology, so where commercial and technology intercepts then that’s what I’m going to be able to bring to the table. But also the skills to engage people because at the end of the day it’s going to be how we work with the rest of the people, the rest of the stakeholders here to deliver on the turnaround strategy. It’s about people, it’s about tradeoffs that have to be made, it’s about being clear and resolute about executing on the plan. So I bring a very strong capability to execute on projects, as well as commercial skills.

WARREN THOMPSON: Have you joined as a permanent employee or do you have a contract with SAA and if it’s the latter how long is that contract for?

VUYANI JARANA: I’ve joined on a five-year contract.

WARREN THOMPSON: Mr Jarana, I wish you all the best of luck in the role and we look forward to engaging you in the future as you develop those plans and hopefully execute them to everyone’s benefit.

VUYANI JARANA: Thank you very much and thanks for having me.

WARREN THOMPSON: That was the incoming CEO of South African Airways,
Mr Vuyani Jarana.

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To come in as minority equity partner in a business where you are going to be outvoted as soon as you want to rightsize the labour force and get the salary bill down to affordable levels, you’re going to have to be a very rare combination of stupid and rich. Good luck with that search.

OK, new boy, here is a tip.

Retrench 40 % of staff, then you may have a fighting chance.

Hi Warren, great interview. Do you perhaps have Vuyani’s email address?

Ceos of SOEs have no credibility because their credentials are often suspect , mainly political appointees and they are basically puppets on a string controlled by the Zuptas.
wonder how long this shiny vaseline head will last.

End of comments.

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