Business / Companies
Air Zimbabwe suspends CEO
12 Oct 2017 at 06:54hrs | Views
TROUBLED national airline, Air Zimbabwe (AirZim), has suspended its chief executive officer (CEO), Ripton Muzenda, pending dismissal for allegedly opposing a board resolution to retrench over 200 workers, The Financial Gazette has learnt.
President Robert Mugabe's son-in-law Simba Chikore, AirZim's chief operating officer and Muzenda's second in command, would be in line to take executive control of the airline.
The move could mark a dramatic turn to Muzenda's tumultuous 15 month tenure at the beleaguered airline, during which he is said to have resigned twice due to frustration. The AirZim board turned down Muzenda's previous resignation bids.
Sources disclosed that Muzenda had been forced out after refusing to assent to an AirZim board decision for a retrenchment plan that was meant to reduce the troubled carrier's high employment costs, which had reportedly undermined turnaround efforts.
The AirZim board had pressed ahead with firing at least 300 staff, including some of its longest serving executives, as part of efforts to bring about wholesale changes to the national airline's corporate culture.
Chairperson, Chipo Dyanda told The Financial Gazette in April that the airline, battling a sharp fall in passenger numbers, had enlisted the services of consultants to conduct an investigation into the company's workplace culture, the results of which are yet to be made public.
AirZim is 100 percent owned by government and falls under the Ministry of Transport and Infrastructure Development.
Transport Minister, Joram Gumbo, who has developed a penchant for cryptic responses on the situation at the airline, denied knowledge of Muzenda's suspension.
"I am hearing it for the first time from you. I do not know anything about it," Gumbo told The Financial Gazette.
But at least four authoritative AirZim and aviation industry sources confirmed to this newspaper that the AirZim boss, who assumed the hot seat in August last year, had been shown the door last week.
The Financial Gazette understands that the AirZim board is scheduled to meet over the next few days to decide Muzenda's fate.
"I am told he was resisting board directives to arbitrarily retrench staff, which is crippling operations," an executive at AirZim said this week.
A previous retrenchment of another 300 workers was recently overturned by the courts, and the airline was ordered to reinstate the workers.
"He was forced to go on leave. The AirZim board will be meeting either on Friday or on Monday next week to endorse his dismissal," the source said.
"It is difficult to assess him given the operating environment. He did not have a particularly good working relationship with the board and had a tense relationship with his number two. He was also not the minister's favourite.
In my own assessment, he did not achieve much. It also did not work that when he came, he had zero trust for the previous management," the source said.
The airline's influential chief operating officer Chikore is said to have played a key role in bringing Muzenda from Singapore last year.
People aware of developments at the airline said immediately after the two started working together, relations deteriorated because Chikore usurped his role.
With a divided executive and poor relations between the CEO and the board, the airline had been careering down the abyss.
AirZim's passenger numbers have plummeted to about 230 000 per annum in the past few years, from a peak of one million in 1996, as travellers opt for other airlines on the four domestic destinations it services.
The 230 000 passengers pale into insignificance considering developments in the airline industry in the region.
When Britain's longest-surviving airline brand, Monarch Airlines went into administration two weeks ago, it left 110 000 customers stranded and 750 000 bookings in limbo in only one week.
Muzenda was the seventh CEO in 14 years since 2003, a statistic described by one airline executive this week as "pretty much scary".
The 2003 departure of Rambai Chingwena as CEO marked the beginning of a frenzy of hirings and firings that included Innocent Mavhunga, Oscar Madombwe, Peter Chikumba, Grace-PFumbidzayi and Edmund Makona, who Muzenda replaced in August last year.
CEOs are not entirely to blame for the problems that have rocked AirZim in 14 years; it is government that is letting the airline down.
Analysts said it would be a miracle if AirZim bounced back.
The company faced a new kind of crisis from the first quarter of this year, when it was forced to exclusively depend on leased aircraft, including jets from StarAir Cargo of South Africa, to service its domestic and regional route networks, while former employees camped on its gates, demanding retrenchment packages.
President Robert Mugabe's son-in-law Simba Chikore, AirZim's chief operating officer and Muzenda's second in command, would be in line to take executive control of the airline.
The move could mark a dramatic turn to Muzenda's tumultuous 15 month tenure at the beleaguered airline, during which he is said to have resigned twice due to frustration. The AirZim board turned down Muzenda's previous resignation bids.
Sources disclosed that Muzenda had been forced out after refusing to assent to an AirZim board decision for a retrenchment plan that was meant to reduce the troubled carrier's high employment costs, which had reportedly undermined turnaround efforts.
The AirZim board had pressed ahead with firing at least 300 staff, including some of its longest serving executives, as part of efforts to bring about wholesale changes to the national airline's corporate culture.
Chairperson, Chipo Dyanda told The Financial Gazette in April that the airline, battling a sharp fall in passenger numbers, had enlisted the services of consultants to conduct an investigation into the company's workplace culture, the results of which are yet to be made public.
AirZim is 100 percent owned by government and falls under the Ministry of Transport and Infrastructure Development.
Transport Minister, Joram Gumbo, who has developed a penchant for cryptic responses on the situation at the airline, denied knowledge of Muzenda's suspension.
"I am hearing it for the first time from you. I do not know anything about it," Gumbo told The Financial Gazette.
But at least four authoritative AirZim and aviation industry sources confirmed to this newspaper that the AirZim boss, who assumed the hot seat in August last year, had been shown the door last week.
The Financial Gazette understands that the AirZim board is scheduled to meet over the next few days to decide Muzenda's fate.
"I am told he was resisting board directives to arbitrarily retrench staff, which is crippling operations," an executive at AirZim said this week.
A previous retrenchment of another 300 workers was recently overturned by the courts, and the airline was ordered to reinstate the workers.
"It is difficult to assess him given the operating environment. He did not have a particularly good working relationship with the board and had a tense relationship with his number two. He was also not the minister's favourite.
In my own assessment, he did not achieve much. It also did not work that when he came, he had zero trust for the previous management," the source said.
The airline's influential chief operating officer Chikore is said to have played a key role in bringing Muzenda from Singapore last year.
People aware of developments at the airline said immediately after the two started working together, relations deteriorated because Chikore usurped his role.
With a divided executive and poor relations between the CEO and the board, the airline had been careering down the abyss.
AirZim's passenger numbers have plummeted to about 230 000 per annum in the past few years, from a peak of one million in 1996, as travellers opt for other airlines on the four domestic destinations it services.
The 230 000 passengers pale into insignificance considering developments in the airline industry in the region.
When Britain's longest-surviving airline brand, Monarch Airlines went into administration two weeks ago, it left 110 000 customers stranded and 750 000 bookings in limbo in only one week.
Muzenda was the seventh CEO in 14 years since 2003, a statistic described by one airline executive this week as "pretty much scary".
The 2003 departure of Rambai Chingwena as CEO marked the beginning of a frenzy of hirings and firings that included Innocent Mavhunga, Oscar Madombwe, Peter Chikumba, Grace-PFumbidzayi and Edmund Makona, who Muzenda replaced in August last year.
CEOs are not entirely to blame for the problems that have rocked AirZim in 14 years; it is government that is letting the airline down.
Analysts said it would be a miracle if AirZim bounced back.
The company faced a new kind of crisis from the first quarter of this year, when it was forced to exclusively depend on leased aircraft, including jets from StarAir Cargo of South Africa, to service its domestic and regional route networks, while former employees camped on its gates, demanding retrenchment packages.
Source - dailynews
