KQ’s new Polish chief needs support to fix ailing airline

I had an opportunity to engage the new Polish CEO of Kenya Airways, Mr Sebastian Mikosz, to get a first-hand insight into the goings-on at the company.

A one-on-one with the new kid on the block such as Mr Mikosz is what allows you to assess things such as focus, sense of urgency and strength of character and whether the man tasked with the herculean task of spearheading the turn-around of the troubled airline has what it takes to deliver.

As we all know, the struggling company has only recently spent hundreds of millions of shillings on foreign consultants.

Just the other day, it was touting how it had hired McKinsey Transformation Recovery Services to prepare a five-year “operational turnaround concept” and “bankable plan” that would radically change its fortunes in the short-term.

RESTRUCTURE
They told us that the company had hired London-based debt adviser PJT to develop a financial restructuring concept and long-term capital plan that would completely restructure its balance sheet and turn it into a sustainable long-term business.

My meeting with Mr Mikosz was taking place against the backdrop of unsettling reports about an exodus of long-serving top managers.

Even more sensational were reports that the CEO had hired five consultants from Poland hardly six months after taking over at the debt-ridden firm.

EXPERTS

These reports, coming against the background of the departure of long-serving managers, served to stoke nationalistic sentiments that found expression in a statement by the Secretary-General of the Central Organisation of Trade Unions, Mr Francis Atwoli, who described the hiring of the experts from Warsaw as unacceptable.

“The current chief executive officer, Mr Mikosz, should bear in mind that Kenya has people more qualified than him and that there is no need for him to hire first-line managers from his own country of origin,” he said.

This is the context and background against which my encounter with Mr Mikosz was happening.

AVIATION

So, the first thing I wanted to hear from him is what he wants to do that has not been done before.

Considering the depth and gravity of the financial woes afflicting the airline, I expected to hear aggressive ideas and assess whether the man from Warsaw would display deep domain knowledge and experience in the aviation industry.

More important, I wanted to see a manager with a crisis mind-set because I have always believed that a successful turnaround plan for Kenya Airways must begin by a candid appreciation that things had gone very wrong for the national carrier.

REVENUES

When the conversation started, it was clear to me that the man has deep domain knowledge of the subject.

Young and aggressive, Mr Mikosz diagnoses the problems of Kenya Airways with a trademark no-holds-barred style.

He says the airline must make bold and radical decisions about its costs base and introduce radical measures on growing revenues.

“We must urgently work on building credibility with banks and other financiers,” he quipped, adding that a successful turnaround would require a massive culture change in the workforce.

KNOWLEDGE

He argued that the lesson from the forensic report by Deloitte was that the firm has major problems with what is needed to bring back the business to its basic elements of success — issues such as pricing of tickets, procurement of fuel and spare parts, hedging and aircraft leasing.

Will he deliver where others failed? Only time will tell. He has very strong credentials for the job.

More, he comes through as a man who is approaching the assignment with the right attitude.

He displays a good understanding of what it takes to save a faltering business.

SUPPORT
Yet I see him facing a lot of resistance. He will have to display dexterity in dealing with the unions.

But at the end of the day, much will depend on the support he gets from within the government, but more importantly from chairman Michael Joseph.

We still remember how Mr Joseph was only days old at the company last year when he was called upon to lead negotiations that finally led to the lifting of a strike notice by the pilots.

INTERESTS

From the outset, the signal the government was sending was that Mr Joseph was not going to be any ordinary chairman of a parastatal.

Then there is the fact that influence over Kenya Airways involves very powerful forces in the government, each with its own vested interests.

Powerful figures, including former top executives who were forced out of the company, have planted allies within the board, the bureaucracy of the airline, and even the pilots’ union.

Still, let us allow the Pole to show what he is capable of delivering.

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