Davis & Shirtliff – Passing the Torch
As he nears retirement, Davis & Shirtliff’s CEO reflects on what he is learned from his time with the company and shares his excitement for its future.
The Davis & Shirtliff Group is the East African region’s leading supplier of water-related equipment, first established by Eddie Davis and his partner, Dick Shirtliff in 1946. Eventually, Eddie passed the torch to his son, Alec Davis. Alec made David Gatende CEO of the firm, and together they made the company what it is today.
Since we last spoke with Gatende, like most companies, Davis & Shirtliff has had to navigate some unprecedented challenges.
“It’s been quite tumultuous. It has been a roller coaster. Right now, we are going through the problems caused by the Omicron variant, which is really virulent but not as severe. It is spreading like wildfire,” Gatende tells us. “But the business has grown. In 2019 and 2020 our revenues did not dip; they stayed the same despite it being the first year of Covid. This year at a Group level we breached the $100 million threshold that has been a target for a number of years. We saw 9% growth at the group level. We’ve just completed a new warehouse, a 10,000 square metres facility.”
But as we talk it also becomes clear company is about to undergo another torch passing.
“We have just celebrated our 75th anniversary,” Gatende says. “We’ve had 20 years of very stable executive leadership. But in May our Managing Director of Kenya, Dr Mas Waweru, retired after 20 years in the company, and I will retire in May next year after 36 years.”
In light of this change of the guard, the company’s 75th-anniversary celebrations have been based around the theme “Davis & Shirtliff 3.0”. Davis & Shirtliff 1.0 marks the period from 1946 to 1990, ending with Alec Davis buying out his partner and giving Gatende a leading role within the company. This marked the beginning of Davis & Shirtliff 2.0.
“Alec Davis is a second-generation member of our founding family, and I’d been with the business for four years at that point, so he and I formed the core team that was then responsible for the change in the business,” Gatende recalls. “For about ten years there were five of us that ran the company, then in 2000 we had the senior managers become executives and that team has led the business without much change for the last 21 years.”
Davis & Shirtliff 3.0
With Waweru leaving the company, followed by Gatende next year, that age is coming to an end. But even now, Gatende is focusing on the next stage.
“I already have in mind who the successor will be and that will be announced in January,” Gatende says. “We’ve launched ten new branches in Kenya, and two in Tanzania, and one in Zambia. We are going to be expanding into West Africa with a beachhead in Ghana, and we are going to establish a business in Somalia. We are also building a distribution centre in Lusaka, Zambia, serving Malawi, Botswana, Mozambique and Namibia. There will be branch expansion, a succession plan, new distribution centres opening, and a focus on ESG.”
Indeed, renewable energy is an area that Gatende is particularly enthused about.
“We’re in seven business segments and we are very well known in three of them, water pumps, swimming pools and borehole pumps,” he says. “What is very interesting is what’s happening in the other four sectors, solar, water treatment, generators, and irrigation.”
Davis & Shirtliff’s solar business is about to overtake the far more well-known water pumps sector of the company.
“So, the tail is starting to wag the dog. The solar sector of the business has been active for 15 years but is already worth $20 million and is about the size of our water pump business,” Gatende points out.
Clean energy is a growing market, but Davis & Shirtliff is also looking at the sector for its perspective of “putting purpose before profit”. Being a family business, this is a particularly important value, as seen in its recent and growing campaign, the #improvinglivesinitiative.
“Our purpose is to improve people’s lives by providing water and energy solutions across Africa,” Gatende explains. “We have solutions, particularly in solar, that have a profound impact on people’s lives. The cost of electricity is astronomical but living on the equator we do not have to pay for the sun. We have it 12 hours a day most of the year.”
Gatende finds it particularly ironic that the majority of interest in the solar sector seems to be in the north, where sunlight is far scarcer than it is in Davis & Shirtliff’s home turf.
“We’re partnering with businesses in the UK with a separate but related business to offer affordable solar solutions, particularly for pumping water, where customers can pay slowly because financing is often the obstacle,” he says.
The Lessons of 36 Years
Gatende’s excitement for where the company is going next is tangible, but he also knows it will be somebody else that takes it there. As he prepares for retirement, Gatende is also looking back on what he has learned during his time as Davis & Shirtliff’s CEO.
“If Covid’s been good for anything it is that it caused us to pause and spend more time reflecting on ourselves. We are not travelling as much as we used to, we had more time on our hands, and as I approach my retirement, I’m a bit more reflective,” he tells us. “When I joined the company, we had one business. We sold water pumps, there was no irrigation, so solar, all the company’s other segments have started in those 35 years.”
Back then Davis & Shirtliff had one business outlet rather than the many branches it has today, but Gatende is still sitting at the exact same desk.
“Someone asked if I’ve been going to work at the same place for all those years, and I have, but I haven’t been doing the same job,” he laughs. “The business has grown and grown and grown. We are now in nine countries employing nearly 1,000 staff and one of the key lessons I have learned is that you have to plan big. We go through this annual planning progress that is quite rigorous. We involve everyone in the company. Planning big has been an important part of the success of this business. We’ve not done everything we planned, but we achieved 70-80% of that because we aimed high.”
While that planning is important, Gatende points out that they would be nothing without the people who enact them.
“The second lesson is the resilience and resourcefulness of our staff. I have just come back from Uganda, and it hit home how we make decisions, and our people just get on with it. As executives, we set up an environment where people work, and they just run with it. It is amazing. It boggles the mind. We are in the right segment, in a part of the world with huge potential. I’m stepping aside but I am really excited for the future to come.”