Joseph bows out after a 10-year stint at Safaricom

Telecoms giant Safaricom on Thursday announced that its long-serving chief executive, Mr Michael Joseph, will retire in November, handing corporate Kenya its biggest and most critical executive transition.

The exit of Mr Joseph, who built Safaricom from scratch to become East Africa’s most profitable company in seven years, will be closely watched in the region and is expected to become a case study in succession management.

Mr Bob Collymore, who has worked as the Governance Director for Africa at Vodafone and has been on the company’s board for four years, will be the new chief executive.

Mr Joseph’s departure has been on the cards since early this year, when he indicated that he would be leaving the firm.

“I have been involved in Safaricom from its founding. It is in my interest and that of all stakeholders to have a smooth and successful transition when the time comes,” he said.

Vodafone has retained the right to select the company’s chief executive and financial officers and exercised this right in the appointment last year of Chris Tiffin as Safaricom’s CFO.

Mr Joseph jetted into Kenya 11 years ago to take charge of his employer Vodafone’s latest investment in sub-Saharan Africa.

It was under him that Safaricom, then a struggling enterprise, rose to become East Africa’s largest and most successful in terms of earnings.

Safaricom, officially launched its operations in Kenya in 2000 with Vodafone pumping in $20 million.

Among the first challenges that Mr Joseph faced was the failure by the other shareholder in the company — Telkom Kenya — to pump in its expected $30 million share of investment into the operation, that had only 17,000 customers, an outdated network and a huge cash deficit.

Mr Joseph and his team of five, who operated out of a small office in Logonot Place, also had to contend with coming to the market of its main rival KenCell, which had captured the lion’s share of the corporate market.

But Safaricom’s launch strategy — to appeal to the masses, bill in seconds rather than minutes and focus on pre-paid customers — paid off and within months, KenCell’s lead had narrowed.

By 2005, Safaricom’s grip on the Kenyan mobile market was cemented and in 2007, the company launched its mobile money transfer service M-Pesa— an innovation whose implementation was credited to Mr Joseph’s courage and which paid off handsomely winning over more than 9.5 million subscribers to date.

Mr Joseph also successfully steered the company through its initial public offering (IPO) in 2008.

“His retirement is my biggest concern about the continued success of this firm. The succession must be well executed to maintain public trust in the company,” said Aly Khan Satchu, a financial markets analyst.