Kenya Power now sends 24 senior managers packing in major shake-up

Corporate News

Kenya Power chief executive Ben Chumo said the electricity distributor is moving to a leaner organisational structure. PHOTO | FILE 

By DOREEN WAINAINAH, dwainainah@ke.nationmedia.com

In Summary

• Kenya Power is offering the affected staff send-off packages that CEO Ben Chumo says are meant to smoothen their exit, including payment of three months’ salary in lieu of notice, advance payment of eight months basic salary and a fully paid for pre-retirement training.
• The shakeup, which will cost the company about Sh430 million, is the result of a PwC audit of Kenya Power’s structural and financial fitness to perform its mandate.
• The number of executives reporting to the managing director has been reduced to 10 from the previous 18.

Electricity distributor Kenya Power has sent 24 senior staff packing in a management shake-up its chief executive Ben Chumo says is linked to a recent audit of the firm that recommended a reduction of positions at the top.

The majority of the exiting managers had been asked to apply afresh for the fewer top jobs that were left after the restructuring, but were not successful.

“The new positions were advertised internally and externally so we can promote staff with potential and also bring in new blood,” said Dr Chumo, adding that Kenya Power is moving to a leaner organisational structure that involves the merger of some management functions.

The number of executives reporting to the managing director has, for instance, been reduced to 10 from the previous 18.

Kenya Power is offering the affected staff send-off packages that Dr Chumo says are meant to smoothen their exit, including payment of three months’ salary in lieu of notice, advance payment of eight months basic salary and a fully paid for pre-retirement training. The packages will cost the company about Sh430 million.

The shake-up is the result of an audit of Kenya Power’s structural and financial fitness to perform its mandate. The audit was done by consultancy firm PricewaterhouseCoopers (PwC).

“We contracted PwC to find the best package in line with the affordability and market trends culminating to the drawing of a five-year strategic plan whose implementation has begun,” said Dr Chumo.

Under the new structure, Kenya Power’s departments will be headed by general managers who have replaced chief managers.

The general managers will head the ICT, human resources, business strategy, regional coordinator, supply chain, corporate affairs, customer service, infrastructure development and finance departments.

Some of the departments that were merged in the structural changes include energy and transmission, operations and distribution that now make up the network management division.

All the retiring employees are above 50 years of age and at most eight years away from the official retirement age of 60.

All senior managers who have agreed to go on voluntary retirement have been asked to reach the general manager in charge of human resources and administration not later than Wednesday.

Revenues vs staff costs

Kenya Power reported a pre-tax profit of Sh4.2 billion in the half-year ending December 2014, an increase of 53 per cent compared to Sh3 billion for the same period in 2013.

READ: Higher tariffs lift Kenya Power profit 38pc