Alec Davis, outgoing Chief Executive Officer (CEO) of Davis & Shirtliff
By JAMES WANZALA
Tell us the story behind formation of Davis & Shirtliff?
Davis &Shirtliff (D&S) was founded in 1946 by Eddie Davis and Dick Shirtliff. Mr Davis had just left the army with a gratuity which he spent buying a stake in a small plumbing business he had worked with as a contractor.
Mr Shirtliff soon joined him and the initial expertise was provided by Italian ex-prisoners of war.
The company was based at Westlands (now the Nyota Petrol Station site) and grew rapidly as the country recovered after the war focusing on boreholes, water supplies and the coffee industry. Notable early projects included the water supply for Karen Estates, the entire water supply infrastructure until the mid-60’s being installed by D&S.
How does it feel steering the company for 25 years until achieving 70 years of existence?
I feel proud having made a contribution since the business we are in has improved people’s lives for the past 70 years through provision of clean water.
We have now sold nearly 1 million water pumps so far. We lead the industry and have trained people in water technology not only those that work in our company but also in other private and public companies.
It is true to say that most Kenyans will regularly benefit from a Davis & Shirtliff products in the course of their daily activities.
How has been the company’s management changed and location grown from Westlands to the current location?
It grew with the country and in the mid-1950s the offices moved to larger new premises at the present location in the Industrial Area.
In 1970 partner Dick Shirtliff retired and his shareholding was purchased by a long serving staff member, Devji Shingadia.
He and Eddie Davis then ran the company, I joined it in 1976. Eddie passed away in 1982 at the age of 79 and I then assumed his shareholding, in 1990 purchasing Shingadia’s shareholding as well and became its CEO.
1993 was a significant year for both Kenya and D&S as economic liberalization occurred and this was the catalyst for the company’s rapid growth since.
Describe how has been the diversification since the 70s and currently including revenue growth?
The 70’s and 80’s saw slow but steady growth as the country grappled with various economic and political problems, though there was a particular focus on building the pump importation business, notably Grundfos and Davey that were introduced in the mid-1960’s.
In the 90s we started our solar and generator activities, which we are still doing up to date. Today, our group revenue stands at Sh7 billion per year.We now have subsidiaries in Uganda, Tanzania, Zambia, Ethiopia, Rwanda, and South Sudan and now looking to venture into DRC Congo.
The whole group has 600 employees with 450 in Kenya with twenty eight branches all over the country. Recent branch openings include Narok, Kitui, Ongata Rongai and Mombasa Downtown.
What about the product range today?
The product range has hugely expanded with a focus on six market segments – water pumps, boreholes, swimming pools, solar equipment, water treatment and power generation. Though much equipment is imported the company is a significant manufacturer making fibre-glass products, its distinctive yellow pool filters being especially popular, as well as fabricated steel items and it also assembles a wide range of water related equipment.
What has been the secret behind the success of Davis &Shirtliff for all those years?
Consistency of management through successful changes where necessary. Progressive but not over ambitious aspirations, living the values of quality, integrity and ‘Altiora Peto’, which translates to embracing continuous change and finally harmonious staff relations and enormous staff commitment and motivation since the company’s founding.
As you retire end of May, will you hand over the management to your children or what plans do you have?
No, the new CEO David Gatende, a Kenyan, will drive this growth. I do not intend to retire from work, rather change my focus and become involved in other activities while still retaining an involvement with Davis & Shirtliff. I am also the chairman of Gertrude Children Hospitals and want to look for new business opportunities for the company because as a CEO one is absorbed with the day to day routines and hence lack time for such.
Has Kenya’s real estate sector been also a driver of the growth of the company’s fortunes?
Of course yes, real estate is symptomatic of the economy’s growth. Most homes in Nairobi have our products, either a swimming pool, water pump, generator or any other product.
Tell us abit of yourself, education, family hobbies?
I was born in Kenya in 1950 and went to St. Mary’s School, Nairobi and later to UK for secondary education. I then completed an engineering degree at Loughborough University followed by an MBA at Manchester Business School returning to settle in Kenya in 1976. I am a married and the father of two sons who both work in the business. I enjoy swimming for fitness and also have an interest in classic cars.
Tell us more abit of history about your family?
My grandfather, also Alec Davis, was among the few first Europeans to settle in Kenya well before WW1. He was a journalist and owner of the Leader newspaper, which was based at the current Leader Building on Moi Avenue, Nairobi. The Leader became The East African Standard that later evolved into The Standard. He also owned the Theatre Royal, now Cameo Cinema on Kenyatta Avenue, Nairobi.
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Alec Davis, outgoing Chief Executive Officer (CEO) of Davis & Shirtliff
By GITAHI NGUNYI, The People Daily
Alec Davis may not be a familiar name outside engineering circles. But Davis & Shirtliff, the firm he inherited 34 years ago from his father is a household name in the water business. The firm is this week celebrating its 70th anniversary since it commenced operations.
Started in 1946, Davis & Shirtliff has always been under the management of members of the Davis family; starting with family patriarch Eddie Davis and then Alec who took over as chief executive after his father’s demise in 1982.
That will be the case until end of this May when Alec, when will leave the management of the company that distributes water and energy equipment to an outsider. This month he is completing the process of handing over to his anointed successor David Gatende who is currently his deputy.
What makes Alec’s exit from the management of his company unique is the fact that Davis & Shirtliff shareholding has not changed at all. The company’s shareholding is still firmly in hands of Alec’s family. Then there is the fact that his two sons work in the company. Traditionally in Kenya, firm owners hang on to management of the companies they own until their bodies give in. And then when they become weak, running of their businesses almost automatically goes to the spouses or children.
So why did Alec, who has grown the business from the relatively small operation he inherited to a multinational with high revenues, break the tradition of Kenya’s family owned businesses by handing over management to a chief executive who’s an outsider?
In an interview with People Daily Alec who will now take a less strenuous role of company Chairman explained the thinking behind his decision to leave the company under an outsider.
“My sons have to prove that they have what it takes to run the business before I can hand it over to them. Of course they are competent and I am sure they will rise to run the business in a few years’ time when they get enough experience” he explained.
Alec says his exit from the executive role in Davis & Shirtliff is a carefully planned succession plan aimed at avoiding the fate of many family owned businesses which fall soon after the patriarch is no longer around.
“You know, the true measure of a person’s success is how successful a business long after you are gone. If a business collapses when the owner dies, then it’s obvious that the succession was not thought through. The problem here is that many Kenyan elites do not plan their succession process and they just leave chaos behind. You have to plan these things because there are many people depending on them. At Davis & Shirtliff we have 600 staff members, there are hundreds of casual staff and their families, and then there are our stockists; I mean there are thousands of people who depend on this company for livelihood. Therefore you have to make sure there is continuity long after you have exited the scene. Of course it is easier in a small family like ours as opposed to big extended families with multiple wives who complicate the process,” Says Alec.
In a closed shareholding like we are, there are few opportunities for wrangling. In our case, the management team is not just Gatende. It is a team. We are well structured and a very professionally managed business. The question of succession is very important for both public companies and family business and it has to be well managed. The chief executive will always report to the board and the board has to give the CEO a performance criteria. If he performs fine, and if he doesn’t a new chief executive is appointed. The whole issue of conflict entirely depends on how the process of succession is managed. But if you a chaotic process then you have a recipe for chaos in the business,” he notes.
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