Labour union CWU (Communication Workers Union) has reportedly expressed its satisfaction over news of Ahmad Farroukh's resignation as CEO of MTN South Africa.

A Business Day online report stated that CWU welcomed the resignation and was quoted by the publication as saying Farroukh "lacked an understanding of the local labour environment."

Approximately two thousand CWU members, employed by MTN and mostly in its call centre operations, embarked on a strike in mid-May.

Issues such as the bonus model, return of canteen subsidies and cellphone allowances, as well as the introduction of the company's new reward and recognition programme, MTN Shine, are at the heart of the strike action.

Yesterday the MTN Group ended recent speculation when it confirmed the resignation of Farroukh who cited personal and family reasons for the move.

According to local analyst and chief executive officer of Strategy Worx Steven Ambrose the resignation in itself does not have any real impact on MTN at the present moment. "The context of where MTN is at present and the impact it may have going forward is more interesting.

"Currently MTN' labour issues in South Africa and its lack of market appeal can be attributed directly to management. Their style has been very distant and hands off, for the most part. There has been a distinct lack of innovation and market involvement from MTN for a long while. They have sat on number two market position and used this to essentially remain static in the market."

Ambrose believes MTN's direct competitors , including Vodacom, are effectively eating into MTN local market share.

"This is very much a strategic issue from the very top of MTN local management, but also is a reflection of how MTN views its local South African operation in light of the local market maturity and greater profit and growth opportunities in other countries , notably Nigeria and the middle east," he continues.

Ambrose suggests going forward the mobile operators would be wise to appoint a visionary to assist in transforming the company from a pure cellular provider into a more diversified and relevant venture.

Dobek Pater, managing director of Africa Analysis and telecoms analyst, says Farroukh's resignation will not have a material impact on MTN SA operations, but added, "the culmination of events over the past 12- 18 months no doubt will have some sort of a tangible impact – cost reductions, retrenchments, almost two-month long strike. MTN is coming under increasing competitive pressure."