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What does it take to be a CEO in Zimbabwe?

From a more global perspective, studies suggest that the quality of a firm’s leadership explain about 15% of the variance in company profitability.  Just like in the game of football, fans lay most of the credit or blame for their team’s results on the manager. That being the case, a common feature globally is that about 80% of CEOs come from within the company while over 50% are MBAs. The pay is also fantastic: the median of America’s top 500 CEOs pocket USD13m a year.  More recently, Sundar Pichai at Alphabet (the company that invented the Google search engine) just got a deal worth up to USD246m a year.  However, most CEOs say the job has got harder, pointing fingers at disruption and intense competition.  A lot is changing – customers and other stakeholders are demanding that firms take a stand on social issues and even the large companies are facing staff protests. Middle managers talk business on social media, and it is becoming difficult to instil brand loyalty amongst customers. The CEOs job now requires the need to master the tricky game of allocating intangible capital while balancing that with the interest of shareholders.

So, what does it take to be a CEO in Zimbabwe? The nature of the CEOs job has obviously changed bearing in mind the unpredictable policies which tend to have big implications on the business. Imagine you are the CEO of a company operating in Zimbabwe that imports more than 50% of its raw materials from overseas. Statutory Instrument 142 was effected and it is clear that you can no longer charge any of your local products in United States Dollars (USD). In other words, there is no other source of foreign currency for your business other than an inefficient Interbank Foreign Exchange market that has been put by the Reserve Bank of Zimbabwe (RBZ). The company does not export anything and yet you try to reassure your board, management, employees, shareholders and even analysts that you will be able to meet your performance targets.  An MBA or Executive Development Programme from Harvard Business School will not do the trick here! While every firm is different, a few more qualities could be important to navigate the stormy economic waters of Zimbabwe.

We have done an assessment of the age groups for CEOs of ZSE-listed companies. Our findings suggest that most CEOs in Zimbabwe are in the 50s as illustrated below;

Estimated Age Groups for CEOs of ZSE-listed Companies

Source: Piggy

Generally speaking, declining birth rates, greater longevity and prolonged participation in the labour force are likely to continue pushing the ages of corporate leaders upward. Very few researchers have looked at how age impacts leadership performance. Even more complicating is that leadership in politics, business, and other types of organizations often requires different personal qualities and behaviours.  Frank Walter and Susan Scheibe (2012) identified a few relevant findings. In task-oriented behaviour—getting the job done—younger and older leaders appear to be equally effective. Age does not seem to impact a leader’s willingness to step up, issue directives, and provide rewards for performance. In contrast, however, age does seem to affect a leader’s openness to change. As leaders grow older, they become less willing to make changes and are less interested in innovation. Another study by Vincent Barker and Geroge Mueller (2002) found that older leaders spent less on research and development than younger ones. Research also suggests that older leaders are more likely to take a passive approach to their leadership role—for example, delegating many duties and becoming actively involved only in crisis situations. They are also more likely to maintain the status quo rather than respond to new opportunities that arise.

As illustrated in the info-graph, those in the 30s hardly make it to the top job in Zimbabwe. However, the new operating environment in Zimbabwe may call for a blend of both young and old. In fact, it now requires leaders to be street-smart or street-wise. This implies having practical rather than theoretical knowledge, such as what is learned on the streets rather than in MBA classrooms.

Skills that are not taught in MBA Classrooms

Piggy thinks that the Innscor group of companies stands out in terms of their ability to navigate in Zim economic tides. The leadership demonstrates an outstanding level of wizardry as they have, over the years, unbundled businesses, bought and sold new businesses while ruthlessly shrugging competitors out of business. In today’s dynamic economy, these could just be the qualities that matter most. Piggy likes Axia, Innscor Africa, National Foods, Padenga Holdings and Simbisa Brands.

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