|Clear management philosophy is key. Shareholders' buy-in equals success |
His appointment was a foregone conclusion because of his record as a capable manager at SAB - which owns 49% of Tsogo - and his close association with black shareholders, who hold 51%.
Besides that, he's superbly equipped to succeed in this position because he has been part of Tsogo since it was formed in the 1990s, when he represent ed SAB's interests on its board. Mabuza was part of the initial team that brought together all the shareholders, sought finance for the venture and successfully tendered for the various casino licences.
"He's proved his worth to the organisation that he helped create and obviously relishes the opportunity to lead it," says Kahn.
Mabuza is self-effacing about his success. Much of it, he says, was pure luck - meeting the right people at the right time.
But there is obviously more to Mabuza than luck. His management philosophy rests on two pillars. The first is that profits are derived from relationships. The second is that business is about people - customers and colleagues.
Kahn is the man who first gave Mabuza a shot at corporate SA by giving him a position as group advancement manager at the SAB in 1993. Up until that point the closest Mabuza had got to the inside of a business was as a member of the Foundation for African Business & Consumer Services (Fabcos), which he helped form in the 1980s.
A key ingredient in Mabuza's extraordinary success story is that he has never been put off by what first appeared to be insurmountable obstacles. The challenge of creating Tsogo Sun is a prime example. Empowerment was one of the biggest ones, as were funding and a lack of knowledge. "We had no experience in the gaming industry. And we had no money either."
What they had was a dream. "It was a major act of faith," says Mabuza. "You spend all this money - R1,4bn at Montecasino alone - and then you eventually open the doors, hoping the customers will come through. Thankfully we had the best sites available - we've earned credibility with our stakeholders."
He also had great belief in himself, his colleagues and his shareholders - such as SAB and Fabcos. "I never had any doubt that it would work - I was certain that if one body could do it, it was us."
Mabuza believes this was because they had "the right mix of ingredients". These included an ability on the part of management to articulate problems and a belief on the part of the shareholders in the ability of management. "The rest is crystal-ball gazing," he says.
After solving the empowerment credentials and funding problems, Mabuza and his team tackled the next challenge - finding someone with gaming expertise. Tsogo found this in Ken Rosevear, a South African who had extensive experience with PricewaterhouseCoopers, Sun International, Caesars and MGM Grand.
"Apart from bringing extensive international gaming expertise to Tsogo Sun, Ken Rosevear had a great understanding of SA and the culture of our company - it was a potent combination."
Mabuza knows and understands his industries well . He believes that leadership is about the ability to motivate and lead people.
"I just happen to have the privilege of working with great, hardworking men and women. I never try to outdo them - I see myself as the leader of a highly capable team. I give them enough space to talk about what they've been trained to do."
But when the debate comes to an end, it's all down to one person making a decision. "Thankfully, there aren't too many break decisions' in this business. "
Tsogo Sun has a long tradition of recruiting good people and training them well. "We recruit for aptitude, train for skills," says Mabuza.
He believes his greatest strength is in relationship management. "Business is about people. If you don't relate to people, you only transact with them. I offer my people the space to be themselves. My role is to deploy their talents properly. To be participative and consultative and to listen as much as possible."
Mabuza admits he's been lucky with his shareholders. The relationship between Tsogo Sun and its shareholders - SABMiller and Tsogo Investment Holdings (TIH) - is engaging, dynamic and participative. Mabuza points out that Tsogo Sun was founded even "before there was any thought of the regulation of casinos".
SAB "brought financial strength and Tsogo brought empowerment", says Mabuza. But the relationship has meant much more. According to Kahn, "the relationship was always more important than the transaction that created it".
Through the years there has been constant speculation that SABMiller would sell its stake. Mabuza is aware of Tsogo's anomalous position within the stable. "We always knew that SAB was a beverage company first and foremost ," says Mabuza. "But we knew they would never drop us."
In the 10 years that Mabuza has been at the helm, the gaming side has grown to be significantly larger than the hospitality sibling - Southern Sun - which spawned it. As much as 65% of Tsogo Sun's revenues and 75% of its Ebitda come from its five casinos, the balance coming from Southern Sun's international portfolio of more than 80 hotels. But this isn't problematic for Mabuza and that ratio may well change over time.
The main shareholder in TIH is now HCI, following prolonged turmoil between various parties, including Fabcos and Johnnic, over the past few years.
On the subject of a possible listing of Tsogo Sun, Mabuza states quite categorically that it isn't on management's horizon. "A listing would be dictated by future business need and opportunities. Apart from that, it would be a matter for our shareholders."
Mabuza faces some tough challenges. Possibly the biggest of these is the fight the gambling houses are engaged in with Reserve Bank governor Tito Mboweni. This week Mboweni accused them of aiding money launderers.
Mabuza vigorously denies the governor's assertion. "In fact, as an industry, we are personally exposed to this and we have been of assistance to the authorities in this respect.
"We have been victims as well, with our operations being targeted for heists and our patrons being robbed," he says.
Mabuza is a keen golfer and tennis player and an Orlando Pirates fan. He is married to Siphiwe and they have two sons Lwazi, 11, and Sakhiwo, 6, and a daughter Mbali (7 months).