Uganda Airlines: outsourced management is a winning formula
“A bittersweet experience…” is how mzee Mashurubu reacts to the current “storm” brewing within Uganda Airlines, our relaunched national carrier.
In its analysis, the airline was relaunched at the right time and at the wrong time at the same time! The right time because with Ugandan agriculture moving towards the commercial angle, albeit at a zigzag snail pace, no better strategy than a national transporter for the export of our fresh products to the world market.
This in light of our neighbors, whose airlines were prioritizing their local exports by allocating freight space and timing, with Ugandans arriving by the way, at exorbitant rates.
In fact, Ugandan export freight was subsidizing the export freight of neighboring airlines: the discount offered to their home farmers would be clawed back from the higher taxes on Ugandan exports.
The wrong time: because our economy, with its high formal employment rate, is besieged by cronyism and related vices in employment … all the more so in “prestigious” organizations like Uganda Airlines.
According to mzee Mashurubu, the winning formula is to outsource the management of Uganda Airlines to a professional management team.
Team and not company or consulting firm. Team of experts from different countries hired on an individual basis but contracted individually (including Uganda: we still have the parastatal leaders of the golden age), all recruited by an independent and reputable corporate governance firm .
Notable key positions are the team leader, who plays the general manager, sales manager, technical director, finance director and human resources director.
Without a board of directors and reporting directly to the Minister of Public Works and Transport with a dotted line to the Head of State, the team will be above the local political fray and influence, with a mandate to make grow the airline towards profitability within five years.
Drawing on the example of Kenya Airways, mzee argues that the presence of KLM senior management as well as other directors recruited from outside the airline and industry has helped Kenya Airways move from a lame parastatal to a respectable player in the industry.
The problems that plagued the airline after the departure of the original team have been attributed to an “external influence” in the formation of the management which followed the deviation, which is being corrected.
Cardinal among the main result areas of the Uganda Airlines expert team will be to develop a profitable portfolio of freight transport to regional and continental markets. Kinshasa in DR Congo only needs medium-range freight carriers and Uganda will not even produce enough to meet demand, especially meat and dairy products.
Equally lucrative is the transport of food aid and other materials to refugee camps and settlements (having failed to stop the generation of refugees, at least let’s pick up the loot from the black scar); and with East African airspace soon becoming domestic, another cash cow is this low cost Ryan Air class airline. Regional air travel remains expensive because the component of airfare that goes into “local” costs is so high, since regional flights are still treated as international flights and not as domestic flights.
And to stem the funding challenges, in addition to statutory allowances, mzee adds that tourist arrival costs at Entebbe International Airport should have 50 percent ($ 25) go directly into the overhead budget of Uganda Airlines. Along with the choice of tourism, this will protect the airline from financial shocks as it moves towards balance and profitability.
By the end of its term, the team of experts will have formed a national leadership and management body, from the CFO to the janitor, who will take the flying crane to even greater heights.