Softbank's president steps down due to uncertainty over future position

In a twist of events, president of Softbank Group Corp. and heir apparent CEO, Nikesh Arora has decided to quit the telecommunication and internet corporation saying he was at odds with current CEO, Chairman and founder Masayoshi Son over the time frame set for Arora to take over the reins. This has left investors puzzled after Son had pursued Arora in hiring the former Google executive with the specific intention of handing him the baton once he decided on a retirement age which was thought to have been next year at 60.

As fate would have it, Son has found new vigour and wishes to extend his stay on with the company he founded for just a little while longer stating his willingness to go on to lead the company for a further 5-10 years.

A number of issues stick out for me when speculating the rationale of Son's decision having actively seeked out a successor who mirrored his vision for the company, then stating firmly that Arora would be installed as the CEO when he departed only to backtrack on his plan which is tantamount to abandoning the goals of the company. Having run the company for the last 35 years you'd expect a large degree of attachment to it which probably explains the reason for staying on.

However this isn't a scene out a daily soap opera, investors don't care for sentimental feelings felt by a founder, they require results and the best possible one's at that. The company has made some smart investments in years gone the most recent being its tie up with Alibaba that saw it reap billions in profit after investing a few million in the early stages of startup.

SoftBank founder's heir apparent Nikesh Arora to quit https://t.co/SA13b3gZJi pic.twitter.com/dggK1JJwbA

— Reuters Top News (@Reuters) June 22, 2016

Last month saw it cashing in for the first time by selling down its stake in the Chinese internet giant from 32% to 28% meaning its lost its holding control on the company, a move that was necessitated as a strategic decision to eliminate high debt levels on its balance sheet.

One wonders whether the company is in prime position to take advantage of the plunge in valuations of functionable, non profit generating social media companies. If it was, Son would step aside and allow a younger person of an upcoming generation who understands the dynamics and potential of social media that possesses the aptitude to find the next big investment for the company to gain from, however not so with the current format of management that doesn't allow for new ideas to flow into the board room instead being dictated by the old regime.

Problem with the old regime is they don't yield to change, making it difficult for new opportunities to find their way into the existing business where you eventually find operations flogging a dead horse so to say.

A good leader knows when the time is right to step aside but this hasn't been the case with Softbank, a sign that the returns once offered to investors looking for great performance might become a thing of the past just as Nikesh Arora found out...