Liebenberg’s Telkom exit should raise concern

Telkom recently announced that Telkom Business Mobile head, Deon Liebenberg, will leave the company in January 2013 to join Vodacom.

Under Liebenberg there was a revived energy at Telkom Business Mobile with a slew of new and innovative products.

The products launched under Liebenberg’s short time at Telkom include Call Max Unlimited (offering unlimited mobile calls at a flat rate), Data Max (offering aggressively priced mobile data bundles) and lower cost Closed User Groups (CUGs).

It is understood that these products started to gain traction in the market, illustrating a strategy which was starting to work for Telkom Business Mobile. The fact that Liebenberg has decided to resign at a time when their strategy is starting to pay off, should be of concern.

Liebenberg is known as an executive who likes to shake up the market and grow small companies into large market players. His results while heading up Research In Motion (RIM) in Africa and Motorola South Africa illustrates this ability.

Industry speculation suggests that Liebenberg was asked by Vodacom CEO Shameel Joosub to join his team after it became clear that things were not looking too rosy at Telkom.

Telkom’s big challenge

Liebenberg’s resignation comes only days after Telkom CEO Nombulelo Moholi announced that she will be leaving the company.

Moholi’s resignation, in turn, comes shortly after Telkom’s annual general meeting (AGM) where the Department of Communications (DoC) voted against the appointment of four non-executive directors. The DoC further voted against several Telkom resolutions at the AGM.

The recent chaotic board moves, which included Telkom chairperson Lazarus Zim, has left Telkom with the curious dilemma of not having enough board members left to form a quorum to elect a new leader for Telkom.

But this crippling of the Telkom board, and the loss of its CEO, is not the only shock to hit the company.

Only a few short months ago, government stopped a deal with South Korean firm, KT Corp – a partnership which was widely seen as a positive development for Telkom.

With a CEO who is leaving the company, a handicapped board left unable to recruit a new CEO, and no deal with KT Corp, Telkom is a very different company from when Liebenberg joined it a few months ago.

With no stability, a significant leadership vacuum, and no international expertise to assist the company with its needed transition, it is hardly surprising that Liebenberg may have felt disillusioned with Telkom.

Telkom is now in an even more precarious position than ever, and it is unlikely that they will be able to make the quick strategic decisions needed to retain energetic executives trying to achieve results.

Combine Telkom’s uncertain future with the DoC’s decision to vote against a forfeitable share plan aimed at incentivizing staff, and Liebenberg’s decision to leave the company looks quite logical.

Telkom is currently facing numerous challenges, and unless the company can find solutions, it may have to add an exodus of competent executives to its list of hurdles.

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Liebenberg’s Telkom exit should raise concern