Strategic changes coming at Denel, new CEO affirms

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Tsepo Monaheng, Denel’s first permanent chief executive in more than three years, appraised “valued stakeholders” via an 8 March communication of “important and strategic structural changes” underway at the State-owned defence and technology conglomerate.

Monaheng, selected from 67 applicants, returned to Irene, Centurion-headquartered Denel this month (March) following a stint at SAFCOL (SA Forestry Company Limited), another State-owned enterprise (SOE) overseen by Public Enterprises Minister, Pravin Gordhan. Ahead of moving to the Pretoria East headquartered natural resources SOE he was chief executive of Denel Dynamics, whose core business, as per the Denel Group website, includes tactical missiles, precision guided weapons, unmanned aerial vehicle systems and space solutions.

Since Danie du Toit exited the chief executive suite in August 2020 just short of two years in office, Denel has been under the stewardship of acting/interim chief executives including Talib Sadik, William Hlokoane and Michael Kgobe. The interim CEO period also saw former chief executive Riaz Saloojee, seemingly sacrificed on the altar of State Capture in the Gupta years, return as chief restructuring officer in May 2022.

Monaheng’s stakeholder communication, seen by defenceWeb, has it the SOE is “migrating” to a new operating model to reflect “proven proficiencies” in the aerospace, guided weapons, landward and integrated systems (ISS) capability domains.

The Denel brand, Monaheng assures stakeholders, remains intact, after which he lists the four rationalised and consolidated trading entities that will revitalise and ensure long term sustainability for the group.

They are: Denel Aerospace, the former Denel Aeronautics and Denel Overberg Test Range (OTR); Denel Guided Weapons, the former Denel Dynamics; Denel Landwards, a consolidation of Denel Land Systems (DLS), Denel PMP, Denel Vehicle Systems (DVS) OMC and Mechatronic business units; and Integrated System Solutions (ISS). This “expands Denel’s level 4, 5 and 6 integration diversifying the ISS military system integration capability into the civil security realm”.

Facilities-wise there are no changes with Denel personnel and equipment remaining at its Centurion and Ekurhuleni campuses as well as Tshwane in Gauteng and Overberg, Bredasdorp, in the Western Cape province.

The new operating model, according to the new CEO, is designed to ensure efficient operations and “optimal service” for customers. At the same time, rationalisation of the corporate office and support services aims to “ensure dynamic leadership” of an “efficient delivery model”.

“The re-organisation will strengthen governance which is crucial to the revitalisation of Denel’s vision as the credible State-owned strategic partner for innovative defence, security and related solutions across our markets, locally and globally,” Monaheng wrote, adding transition to the new operating model was underway.

Almost coinciding with Monaheng’s arrival, Denel is on the hunt for a chief financial officer with a recruitment advertisement seeking a person to, among others, “develop a group finance strategy” based on the Denel corporate plan. Closing date for applications for the position held by Carmen le Grange, as per the last published Denel annual report (2019/20), is 31 March.