March 2016 Kshs. 300 / Ushs. 9000 Tshs. 6000 / RWF. 2200
INSIDE LETSHEGO KENYA YOUNG EXECUTIVE WITH A MIDAS TOUCH MILLENNIALS: BURDEN,BLESSING OR BOTH ? ALEXANDER FORBES’ NGAO MILELE
PAUL WAMBUA leading Sacco bets on innovative products and exceptional service delivery to redefine customers experience
STIMA SACCO LIGHTS-UP MEMBERS EXPERIENCE
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Content
22. STIMA SACCO
EDGE FOCUS 14. MICROFINANCE Formed barely a decade ago, leading MFI Letshego Kenya (formerly Micro Africa) bets on innovative financial solutions to redefine clients’ experience
18. ETHICS IN BUSINESS The firm sets precedent in the fight against ethical misconducts with robust risk management structures
MAIN STORY 16. STIMA SACCO
20.
EXECUTIVE TALK
4. HEAD START 6. QUOTABLE QUOTES 7. MAIL 8. BRIEFS
The leading Sacco bets on innovative products and exceptional service delivery to redefine customers experience
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Content
OPINION 28. CUSTOMER SERVICE The only way to become rich is to put all your eggs in one basket and then watch that basket–Andrew Carnegie
30. MARKETING In 2015, Facebook had more than 1.59 billion active followers. Similarly, Twitter had more than 305 million active users on monthly basis.
32. PERSONAL BRANDING In the business world people will form judgments about your education, intelligence, background, and personality simply based on the language you use to express yourself.
14.
34. CAREER KNOWLEDGE
MICROFINANCE
Millennials: Burden, Blessing, Or Both?
MAIN FEATURE
46.
TRAVEL & LEISURE
36. ENTREPRENEURSHIP Cytonn Investments brings entrepreneurs together with an aim of sharing experiences on how to start sharp and thrive
38. SECURING YOUR FUTURE The firm unravels its commitment of helping people attain peace of mind through securing their financial wellbeing, now and in the future.
40. MICROINSURANCE
ENTREPRENEURSHIP
Tughral Ali, Head of Africa, MicroEnsure unravels the firm’s love for low-income markets and what accounts for its continued rise in a dialogue with Edge magazine.
36.
BOOK REVIEW 44. NAIROBI HEAT
48.
TRAVEL & LEISURE 46. KENYA A Traveller’s Guide To the Kenya National Archives
BOOK REVIEW 44.
SONG REVIEW
Managing Editor Sylvester Okumu Sylvester@edgemagazine.co.ke Editorial Oroni Tendera Ibrahim@edgemagzine.co.ke Jenny Nyawira Jenny@edgemagzine.co.ke Contributors Derek Bbanga CarolyneGathuru John Kageche MbuguaNg’ang’a Peter Kamande
Business Development Manager Murrel Aluoch Marketing Executive Nelly Wambui Operations Washingtone Terry
Creative director Felix Rurigi felix@edgemagazine.co.ke
Published by Fine Edge Media Longonot Building, 3rd Floor, Apartment 2A, P. O. Box 74298-00200 Kijabe Street, Nairobi, Kenya. Tel: (+254) 20-2088776 Cell:(+254) 724 113 683/ (+254) 715 507 024/ (+254) 770 467 370 E-mail: info@edgemagazine.co.ke Website: www.edgemagazine.co.ke Edge Magazine is published monthly. Copyright 2016 Fine Edge Media. All rights reserved. No part of this publication may be reproduced or transmitted in any form including photocopy, or any storage and retrieval system without the publisher’s permission in writing. The views expressed in this publication are those of the authors and do not necessarily reflect the position of the publisher. Readers are advised to seek professional advice before acting on any information contained in this publication.
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Head start
4
Head Start
Keeping The Positive Momentum
W
e are in the homestretch of the first quarter of 2016. Kenya’s economy looks positive with the stability of the Kenyan shilling and it is important for stakeholders to keep the positive momentum going. So far, Britam Asset Managers have projected that Kenya’s economy is set to grow at between 5.0 per cent and 6.0 per cent, courtesy of the strengthening shilling and inflation staying within targets. It is against this backdrop that we acquaint you with movers and shakers of Kenya’s economy. For instance, we are about to introduce you to Letshego Kenya, a leading microfinance institution that is addressing the need for financial solutions by providing simplified and need-based support to its clients in the country. In the same breadth, you shall be glad to discover how Stima Sacco, aking of financial services delivery in the SACCO sphere bets on innovative products and first rate service delivery to redefine customers’ experiences. In our Executive Talk segment, Chris Gathingu , the chief executive officer of Tangazoletushares with us how his groundbreaking mobile banking app has revolutionized mobile money transactions in Kenya.
Our columnist, Peter Kamande, elucidates how social media marketing can help companies strengthen their balance sheets both in the short and long run. He argues that, traditional methods of marketing-newspapers, magazines, televisions, radios and billboards-have become obsolete, but do you agree with him? Kamande concludes that, if social media tools are properly managed, they can reduce operational costs as well as offer companies a rare but precious opportunity to interact with their clients.
Moving forward, McKinsey & Company outline a systematic approach of unleashing the potential of young employees by building bridges with data, accelerating communication, developing a culture of mentorship, moulding mid-level managers into leaders, blending work and personal lives and involving young employees in fostering solutions rather than creating problems.
We shall also be highlighting Alexander Forbes group, a financial service provider and pioneer of NgaoMilele Post retirement fund. SundeepRaichura, the group’s CEO will reveal to us the secret behind the success of Alexander Forbes Group. Book enthusiasts have not been left out, a review of MukomawaNgugi’s fast-paced Crime fiction, Nairobi Heat, will whet your reading appetite. Lastly, readers with keen interest in ‘travel and leisure’ must get ready to explore the Kenya National Archives and discover the treasure that lies therein. Thank you for your continued support. Ibrahim@edgemagazine.co.ke
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Quotable Quotes
Janet Mwaluda “Television production is very competitive. It calls for creativity and commitment. Shooting a pilot programme is one thing, getting it on TV is a different thing altogether.”
At just 27, Janet Mwaluda sits at the helm of two successful start-ups. She is the founder of Ink House Pals-a print advertising company, and Ink Productions-a film production company. She studied Actuarial Science at JKUAT but her love for art was immense. She is the brain behind Fitness Chasers-a work out show that airs on Zuku, and Nairobi Diaries-a reality tv show that airs on K24. Julian Kyula “The mobile commerce space is a key part of the future and we are committed to keep innovating in that space now and for the future.” Julian is the CEO and co-founder of MODE. Founded in 2010, MODE is a financial technology company that provides mobile value added services to mobile network operators in emerging markets. It has operations in 31 countries with a customer base of over 250 million. MODE’s foundation product is Airtime Credit Service (ACS) – a cashless micro loan. MODE is the global leader in ACS, with 35 live operations carried out in partnership with 10 telcos on 3 continents. MODE has executed billions of ACS transactions since its launch and it is expanding.
Dr. Shikoh Gitau
“I view technology as an enabler to help develop the marginalized areas of society.”
Shikoh works for African Development Bank, where she is leading Technology Innovations for Inclusive Growth initiative. She is the brain behind Ummeli – a Mobile Phone Application that helps people match their skills with available opportunities. Riding on the success of Ummeli and determined to change the situation at home – she joined an international development organization and set up Kibarua, a web portal that connects employers with casual laborers. Kibarua is Swahili word for casual labour. Chef Ali L’artiste
“I’m glad to be an inspiration to the youth who definitely want to be chefs. They should love what they do because it’s all about the passion.”
Born Ali Mandhry 27 years ago, he is a TV celebrity chef. Ali started cooking at the age of nine, and sold cakes he baked to fellow students and teachers at age twelve. The culinary graduate from Kenya Utalii College currently hosts a cooking show on Pwani TV dubbed Food Time and Celebrity Kitchen Raid on Zuku. He previously hosted Tamu Tamu, a cooking show on NTV Kenya. He now owns L’artiste Pastry Factory and is a representative of the Kenya’s Chef Association. He has been named among the top 5 reigning chefs of African cuisine by Africa Style Daily. He has also been considered among top male chefs in Africa by DSTV.
Letters Kudos Techno Brain!
No one gives your business an edge like we do
There is no doubt that Africa is brimming with IT talents. Apparently, in this twenty first century, information technology skills are a prerequisite. This calls for all organizations to take part in developing the skills as that is the only way Africa will be able to compete with other continents across the world. Techno Brain is doing excellent job by nurturing and empowering IT talents in the continent.
Agnes Mwololo, Accountant, Mombasa
Creative Design
Integrated Communications
Incisive Editorial
Advertising
Branding
Concept Ideas
Ethics story is timely Unethical business practices are one of the major causes of a company’s failure. However, it is important noting that ethics should not only apply in for profit firms, but in all organizations. Recently, the issue of corruption in the country made the President to call upon the private sector to help in its fight. Like L’Oreal, I believe that organizations of all kinds as well as government entities should have an ethics department in their structure. That is the only way they can be sustainable in the long run.
Immaculate Wafula Lecturer, Kisumu
A rookie who dared to dream
EDGE www.edgemagazine.co.ke
MAGAZINE
info@edgemagazine.co.ke Tel: (+254) 20-2088776 • Cell:(+254) 724 113 683 • (+254) 715 507 024 • (+254) 770 467 370
Most successful entrepreneurs say that it takes passion and determination. Entrepreneurship is a journey that requires enough focus on why the business started and milestones to be achieved. As an entrepreneur, I admire Levis Maina’s unstoppable desire and determination to succeed in business. I believe that this is what it takes - sacrifice!
Sammy Wainaina Businessman, Nairobi
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8
Briefs
Britam Asset Managers Call For Fiscal Consolidation
B
ritam Asset Managers project that Kenya’s economy will grow at between 5.5 percent and 6.0per cent in 2016, driven by a strengthening shilling, inflation staying within targets and stable interestrates.
in enabling the government to consolidate previous growth and set the stage for even better prospects going forward.
Short term interest rates areexpected to trend between 11 and 15 percent, peaking in the first half of the year as the Central Bank of Kenya seeks to balance borrowing needs with lower interest rates in the economy. The shilling is expected to remain stable over the first half of the year,gradually weakening towards KSh108 against the dollar, as the current account remains in a deficit despite recent improvement.
“Kenya has achieved impressive economic growth in recent years. The real GDP growth has consistently outpaced the average for Sub-Saharan Africa over the last five years, mainly driven by strong performance in trade and real estate sectors, followed by agriculture and manufacturing. Together, these four sectors generate about half of the country’s GDP; though this contribution has been reducing gradually, an indication of increased diversification of Kenya’s GDP,” Mr. Kaniu added.
In its 2016 Gross Domestic Product (GDP) Outlook, the asset management firm forecasts inflation to trend towards 6.0 percent in the year supported by stable food prices and lower energy costs. Inflation is expected to average 6.8 per cent in 2016,marginally above the 6.6 per cent recorded in 2015.
However, in its outlook, with the theme “Fiscal Consolidation” Britam Asset Managers warns that the Kenya government has to live within its means in order to maintain an impressive rate of economic growth, and ultimately fast track attainment of upper middle income status.It counsels that fiscal consolidation –which involves reducing fiscal deficits and checking accumulation of debt – is critical
Kenneth Kaniu, Chief Executive Officer, Britam Asset Managers.
The Chief Executive Officer of Britam Asset Managers, Kenneth Kaniu said that a stable macroeconomic environment is critical inorder to maintain gradual and sustainable economic growth towards upper middle income status.
Stuttering global growth in recent years has made borrowing from foreign sources expensive as Kenya resorted to borrowingon more commercial terms. This has led to heightened domestic borrowing that hascome at a cost – high interest rates that have crowded out the private sector and inconsistency in monetary and fiscal policy regimes.
Kenya’s budget deficit as a percentage of GDP has widened over the last five years to stand at the current 8.7 per cent, the widest in East Africa. Foreign borrowing has also soared, from 23.5 per cent of GDP in 2008 to 28.5 per cent last year. While Kenya’s total debt levels (50 per cent of GDP) remain sustainable, the firm warns that the accumulation of debt and wide fiscal and current account deficits leave Kenya vulnerable to large interest rates and currency movements.
Britam Asset Managers warn that while the expansionary fiscal policy adopted by the government to stimulate growth has proven effective in recent years,there is need to anchor future growth in a fiscal consolidation framework. The asset manager notes the need for better absorption of development funds and overall fiscal discipline in driving sustainable private – sector led economic growth.
The asset manager highlighted sluggish global economic growth, uncertainty incrude oil prices and supply side shocks(such as food inflation) as the main risks to their outlook for 2016. The firm also highlighted that effective budget implementation; prudent fiscal and monetary policy would play a big role inthe attainment of domestic growth targets.
Start-Ups Feted
Safaricom Rita Okuthe and British Airways Acting Commercial Manager Kevin Leung.
T
iny Totos, Pegg Entertainment, Ukall Limited, Zamoyo Limited and Jiinue Holdingson wereawarded by British Airways and Safaricom for winning the Emerging Enterprise Initiative February 26, 2016. The five companies falling under SME categories eachreceive British Airways’48,000 On Business points an equivalent of a return Business Class ticket to London and Ksh. 100,000 worth of Safaricom airtime to promote their businesses in any of the 114 British
Airways destinations around the world. The companies emerged winners from over 100 companies who registered for the campaign.
“The Emerging Enterprise Initiative campaign sought to give small and medium businesses opportunities to spread their wings and explore opportunities to prosper”said British Airways Acting Commercial Manager for Kenya Mr. Kevin Leung during the awards giving dinner at Villa Rosa Kempinsky. He added that the On Business programme is flexible and offers travel savings to SME’s based on their loyalty as well
as cash discounts on selected flights and bonuses. On a single flight both the company and individual can accumulate rewards towards redemption of flights on British Airways, Iberia and American Airline flights.
Safaricom’s Enterprise Business Unit Director Ms. Rita Okuthe said the partnership with British Airways was an opportunity to nurture thegreat ideas and innovation showcased by Kenyan SMEs. “Safaricom aims to support and empower people who want to better themselves and their businesses” added Ms. Okuthe. She also pointed out
that Kenya is an SME driven economy employing 80 percent of people living the country and accounts for 92%of all jobs that are created. The sector contributes 45percent GDP.
The Emerging Enterprise Initiative was launched by British Airways and Safaricom in November 2015 as an effort to provide international exposure for Small and Medium Enterprise (SME) sector. The campaign aims at giving SME’s a boost by offering them access to international markets or a chance to source their supplies from source markets, at the most affordable and competitive rates.
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Briefs
Mabati Rolling Mills Enters Into Stone Coat Market With Launch Of New Roofing Technology
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abati Rolling Mills, the flagship company of Safal Group, Africa’s largest steel roofing company and manufacturer of flat and long steel products, unveiled new advanced technology in the manufacture of roofing sheets in the market in an event attended by professionals and players in the construction industry in Kenya. The most significant innovation was the launch of Premium stone coated steel roofing tiles, Lifestile© This signals the entrance of MRM in this segment that is targeted for the mid – upper end of potential homeowners. The product is available in two profiles – the Wave and Shingle and
comes in a variety of color. “Lifestile is our latest innovation and is a high quality product from MRM to deliver beautiful roofs and by extension homes. Stone coat roofing is now available from a trusted Kenyan company” remarked Harry Njagi, Head of Marketing, MRM. The event started with introduction of an addition Thin Organic Coating (TOC) technology on unpainted sheets.
“TOC is going to add life and durability to Kenyan’s favorite brand, Dumuzas, because it now adds a second level of protection to the Aluminium-Zinc (Zincal©) alloy coat that we have. This means that Dumuzas has a double coat”, said Mr. Njagi.
The event was an opportunity to show case new innovation in the industry and key to this was launch of Saflok©, the only concealed fixed roofing in Africa that does not require the use of nails or screws to fix it to the roof. MRM also introduced Safdeck© a decking sheet used in construction of commercial building using steel frame. “The product brings a new way to do Multi-Story Buildings with Steel Framing & Steel Decking Sheets. Key benefit is that it takes quicker time to construct and uses less concrete to build” Said Steve Kiruhi , Project Sales Manager, MRM Other ranges of products launched were, Maxcover©, a box profile sheet and Steel Tile range, Royal range (Versatile©, Zentile©, Elegantile© and Orientile©).
KCB Bank Kenya Lines up 8 Islamic Banking Branches
KCB Head of Sahl Banking, Jaffer Sheikh Abdulkadir (center) looks on as Salim Bakari serves a customer.
KCB Bank Kenya plans to open at least eight new Islamic banking branches by the end of this year as it deepens its foray into Islamic finance. The bank through its Islamic finance arm Sahl Banking has unveiled a new center in Wajir town on February 25thas part of its expansion plan in Kenya coming days after it set up another centre in Nairobi along Kimathi Street. These are dedicated branches solely offering Sharia-compliant financial products and services.
KCB Group CEO Joshua Oigara said KCB is committed to tap into the rising demand for Islamic products as well as broaden its financial inclusion to Kenyans who feel left out by the conventional banking system. Already the bank has a fully dedicated centre at Kimathi Branch where Islamic
finance products and services are being offered.
The move is part of the Bank’s long term vision to expand its presence, and diversify its product offering and innovation to support the Islamic financial needs. “As a Bank, we are continuously seeking for ways in which we can offer the best services to our customers. Through our e-payments agenda, we hope to increase customer adoption through incorporating digital technology in Sharia Compliant products. In 2016, we are focusing on increasing uptake of Sahl Banking by taking the services near the customers and making them efficiently accessible to all through mobile and internet banking,” said MrJaafarAbdulkadir KCB Bank Kenya head of Islamic banking.
The entire branch network in Kenya offers the Sahl products and it is keen to enhance the quality of customer experience by having dedicated centres in select locations like Eastleigh, Mombasa, Lamu and Garissa among others. MrAbdulkadir added that since the launch of Sahl Banking early last year, the business has posted remarkable growth and provided new solutions and means of payment for Sahl customers.
According to World Bank, the Islamic finance industry has expanded rapidly over the past decade, growing at 10-12 per cent annually. Today, Sharia-compliant financial assets are estimated at roughly USD 2 trillion, covering bank and non-bank financial institutions, capital markets, money markets and insurance.
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From Around The World
Diani And Watamu Beaches Ranked Among The Top 25 In Africa Diani and Watamu have been voted among the top 25 in Africa this year by American travel website TripAdvisor.
Diani Beach in Kwale County was ranked 10th overall, while Watamu Beach in Kilifi County took 23rd position. This comes after Diani was ranked the leading beach destination in Africa by World Travel Awards for the last two years.
The Seychelles and Mauritius had six beaches each among the top 25 best beaches in Africa, while South Africa had five on the list. Anse Lazio Beach in the Seychelles was rated the best in Africa, Camp’s Bay Beach in South Africa second, Praia de Santa Maria in Cape Verde third, while Anse Georgette in the Seychelles was fourth.
Globally, Grace Bay Beach in Turks and Caicos was voted the best in the world, Baia do Sancho Beach in Brazil was in second position, Playa Paraiso in Cuba third, Anse Lazio in the Seychelles fourth, while Cayo de Agua in Venezuela was rated fifth overall.
Whatsapp To End Support For Nokia, Blackberry
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n a post published on its blog, WhatsApp said that its service will not run on BlackBerry (including BlackBerry 10), Windows Phone 7.1, Nokia S40 and Symbian S60 as well as the older Android 2.1 and 2.2 operating systems. The Facebook-owned app said that the targeted devices do not offer customers the capability to accommodate new features when an upgrade takes place ‘in the near future’.
“While these mobile devices have been an important part of our story, they don’t offer the kind of capabilities we need to expand our app’s features in the future,” said the company.
WhatsApp said that the millions of people operating the targeted phones would have to get newer phones by year end or be locked out of the popular text-based service. The firm indicated that the decline in popularity of Blackberry and Nokia devices among users over time was to blame for the decision, saying that when it began in 2009, 70 per cent of smartphones sold at the time had operating systems offered by the two tech companies.
Etihad Airways Presented With Air Transport World’s Airline Of The Year 2016 Award Etihad Airways, the Abu Dhabi-based national airline of the United Arab Emirates, was recently presented with the coveted Airline of the Year 2016 award by the prestigious US-based aviation industry publication Air Transport World (ATW). The accolade acknowledged Etihad Airways’ strong executive leadership team in developing a profitable strategy of organic growth and unique equity partnerships; introducing ground-breaking products and services; creating the foundations for building a motivated workforce; and engaging in a diplomatic, dignified defence of its business model in the wake of fierce opposition by US carriers. James Hogan, Etihad Airways’ President and Chief Executive Officer, said: “This award recognises what we set out to do as an airline 13 years ago – to be safe, profitable and simply the best.
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14
Microfinance
Formed barely a decade ago, leading MFI Letshego Kenya (formerly Micro Africa) bets on innovative financial solutions to redefine clients’ experience
Letshego Kenya Taking Microfinance To The Next Frontier
T the sector.
he financial services industry has evolved fast and furiously in the last few years. With creativity, innovation and technology acting as catalysts- especially through mobile phonesit is difficult to predict the next big thing in
Traditionally, microfinance delivery encompassed adherence to the latter of credit cycle, group meetings and substitute collaterals such as co-guarantees. Currently, financial solutions can be accessed anytime anywhere, thanks to technological innovations.
“Successful microfinance players have to embrace change, without losing the huge mandate of the unbanked population in both urban and rural areas and that is what defines us,” opens up Charles Njoroge, chief executive, Letshego Kenya. In 2009, Letshego Kenya Limited (LKL), formerly Micro Africa Limited had only 8 employees. In 2014, after changing its shareholding, it rebranded to Letshego Kenya. It is now one of the leading financial services solution provider that targets micro and small entrepreneurs as well as employed staff both in private and public sectors in the country.
In Kenya, Letshego provides financial solutions using over twenty eight touch points spread across the spectrum of both urban and rural areas. LKL also offers
Charles Njoroge, CEO, Letshego Kenya.
employment directly to 300 employees who serve and support thousands of entrepreneurial and employed customers with financial needs.
African footprint LKL is an affiliate of the larger Letshego Holdings Limited (LHL) incorporated in 1998 with its headquarters based in Gaborone, Botswana. Letshego holdings has been listed on the Botswana Stock Exchange (BSE) since 2002. It is a holding company with lending and deposit-taking subsidiaries across ten countries in East, Southern and West African countries of: Kenya, Tanzania, Uganda, Rwanda, Botswana, Lesotho, Mozambique, Namibia, Swaziland and Nigeria.
Additionally, Letshego is an African brand, all employees are part of a big team of 1,400 committed professionals, spanning 20 nationalities, tasked with growing the Letshego franchise and far much more creating impact in their respective work stations. Unfazed by these developments, the executive affirms that the firm’s mission and vision is very
clear. “We want to be a market leader and partner of choice in provision of quality, profitable, innovative and customer centric financial solutions.” Besides addressing the need for financial solutions, Letshego works to provide innovative, simplified and need-based financial support. It offers a buffet of financial products that cover diverse financial needs.
The firm delivers loans using two overarching methodologies. One is group based co-guarantee loans. The other is individual based lending. It not only offers housing microfinance loans, but also chama loans, business loans, development and asset based loans, mobile phone supported emergency loans and water tank loans. On top of that, it remains an important player in the provision of clean energy loans- encompassing solar and biogas. Benefits to clients For SMEs, the firm empowers them in transiting to the next level and ultimately actualizing their aspirations. However, the businesses have to be in operation for more than three months.
He notes: “The appeal of microfinance is simple: Give a client an innovative product and walk with him through the journey and he will succeed. However, it is important to do some due diligence first to understand the risks you and your borrowers incur. It is much more empowering and that professionalism defines us.” In spite of the highly competitive nature of the MFI sector within Kenya, Letshego remains unfazed. The CEO points out to the firm’s success in the country as a result of key strategic initiatives of customer experience, risk management, innovation, stakeholder engagement and people development.
Letshego is an African brand, all employees are part of a big team of 1,400 committed professionals, spanning 20 nationalities
1,400
Letshego Kenya not only provides credit, but also gives back to the communities they serve.
who joins Letshego, joins an innovative team with ambitions to build a leading African financial service solution provider. The team in Letshego, according to Njoroge, works in a highly stimulating work environment and have an opportunity to grow their careers. In the same breathe, Njoroge further reveals, the firm has a duty and an obligation to deliver loans that create financial and social impact to customers.
On each of these, Letshego’s objectives and expectations are clearly defined. He notes: “Our Governance structure is also very supportive as we deliver value to our customers and the shareholders alike. It’s a mix of these strategic initiatives and a clear vision and focus that has made all the difference. Furthermore, our response to customer needs has been very effective and the team spirit espoused by the staff very impressive.” Meanwhile, the people pillar at Letshego, just like in any other corporate is the engine that gives it a competitive edge. The firm welcomes diversity and inclusion, and has a clear strategy for talent optimisation, high performance culture and leadership development. Njoroge says that any staff
Citi Microentrepreneurship awards 2014. Former Central Bank Governor Njuguna Ndung’u awarding the overall winner from Letshego.
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Microfinance
Silver Awardees 1. Steve Michael Otieno – Men Urban Category in Service Industry – He owns and runs a school. 2. Johana Kariuki – Men Urban Category in Service Industry – Garbage collection. 3. Francis Waithaka: – Trade Industry. He manufactures Poultry and Dairy feed.
Letshego Kenya CEO Charles Njoroge joins the CITI Microentrepreneurship awardees 2015. Letshego truly finances champions.
“Shall Letshego achieve its main objective of transforming lives through innovation and provision of financial solutions in Kenya?” This writer posted that question to the CEO. “Absolutely!” He nodded in approval before alluding to Steve jobs mantra “People with passion can change the world for the better,” Njoroge continued,“The passion, drive, success, hard work and innovation within the team excites me.”
He comments that he is always referred to as the captain by his staff. He draws the analogy of a football team by Jack Welchthe GE executive: “the one thing that has not changed is the team that fields the best players wins.’’ Celebrated micro financier The CEO reveals that the firm has grown its balance sheet substantially since its formation seven years ago.
He also points out to a couple of corporate social responsibilities that the firm has been involved in. For instance, it has financially supported several homes for the aged and provided water tanks to primary schools. Plans are also underway, in partnership with the Ministry of Health, to curb non-communicable diseases in Kenya.
“We have a governance structure that is Kenyan. Our chair, Kung’u Gatabaki, is seasoned in corporate leadership while Dr. Edward Sambili, our director, was a former
deputy governor of the Central Bank of Kenya and a former permanent secretary in the Ministry of Planning. Mildred Owuor who is a board member brings a wealth of experience from the mainstream banking sector she has served for the last 25 years. Tim Mwai, a director also has the interests of Kenyans at heart,” reveals the executive. He also sits on the board. This, he says, presents a clear understanding of the Kenyan context and enables the firm to make decisions and channel products that are contextual and relevant to the benefits of Kenyans. The firm further draws its membership from the Association of Microfinance Association of Kenya where Mr. Njoroge has also sat as a board member. The CEO avers that Letshego offers need based financial solutions. It is on this ground that it emerged as one of the key financial service providers in the CITI/ AMFI awards in 2014 and 2015. In the 2015 series, Letshego clients scooped a record of 9 awards as follows:
Gold Awardees: 1. Isaac Njuguna Mburu- Men Urban Category in Manufacturing Industry. He has a bone meal milling plant. 2. Simon Kimani Njoroge – Youth Urban Category in Service Industry. He runs an online research writing business. 3. Patrick Hunju – Manufacturing Industry. He runs a porridge flour and Maize meal production. He also does transport business.
Bronze Awardees 1. Peter Mbogo Gachuhu – Manufacturing Industry. He manufactures Agrovet products. 2. Phyllis Wairimu Karani – Youth Urban Category in Manufacturing Industry. She owns a bakery. 3. Rosemary Muthoni Mbugua – Woman Urban Category in Service Industry. She owns and runs a Kindergarten, Primary and high school.
Letshego Kenya was also recognized as one of the innovative microfinance institutions in the country during the 2015 award ceremony. “The award fits well into the strategic initiative of innovation. We recognize innovation as a critical pillar and in Letshego’s Golden rule, we recognize innovation as the number one competitor,” avers the CEO. Outlook The executive admits that microfinance institutions have not just brought financial inclusion success stories in Kenya but also the concept of alternative collaterals, predominantly overlooked by banks-currently a key aspect for credit considerations. According to him, Kenyans now appreciate credit facilities and most of them are financially literate, courtesy of micro finance institutions. He further reveals that the government has come up with strategic interventions to bank youth and women.
“I remain very optimistic of the future of Letshego in Kenya, just like I remain for our dear country Kenya. The financial services sector in Kenya is competitive and very dynamic – but despite this, the demand for innovative and customer focused financial services will remain now and in future,” he concludes. Words Sylvester Okumu
MWANGAZA mitaani
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18
Ethics In Business
The firm sets precedent in the fight against ethical misconducts with robust risk management structures
Safaricom: How We Champion Ethical Business Practices
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ost business theorists define business ethics as the moral principles that guide the way a business behaves and conducts its operations. Interestingly, the same principles that determines an individual’s action also apply to business.
Ethical considerations involves distinguishing between ‘right’ and ‘wrong’. However, it is not easy to define good ethical business practices as this can vary. Despite the law being a key component in explaining a starting point for ethics in any business, most businesses have their own core values and standards which set out their code of operations. A company has wider responsibilities that should not be compromised in their quest for profitability and competency. For instance, a company should treat its employees fairly, stay away from bribery claims, minimize harm to the environment and refrain from damaging the community in which it operates among others.
Safaricom’s Chief Executive, Mr. Bob Collymore
Late last year, Safaricom’s chief executive, Mr. Bob Collymore led the war against unethical business practices in the private sector by disclosing his salary and accumulated wealth amongst other efforts. Mr. Joshua Oigara, KCB Group’s chief executive followed suit. In his statement, Mr. Oigara said that he decided to go public about his wealth to push for transparency in the private sector. For Mr. Collymore, he says that one can accumulate wealth through legitimate means, and his declaration has set precedent.
Integrity Mr. Collymore acknowledges that it is important for people to understand the power and influence that top executives have within a company. He says that he sticks to his mandates and responsibilities and stays away from any role that would undermine decisions within Safaricom. “It is definite that I might compromise a tendering process within the firm if I get involved, so I keep my cool.”
According to him, an ethical aversion in any business is propagated by greed for money. And it is mostly rampant in the private sector of an economy. He shares worries of a business colleague who had to fire a human resource director because she had compromised the recruitment system.
“That is a smart move. Corporate leaders should rethink about their roles in promoting ethical business practices. If a leader breaks a rule, it spills down to the whole system.” Ethics champions The executive underlines the behaviors of individuals within an organization as a key component in ethics.
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Corporate leaders should rethink about their roles in promoting ethical business practices
“Are we treating our staff right? Do we consider gender diversity and respect sexual orientations? Is everyone happy? Do we mind the environment? And are we conducting business with a human face?” he questions.
He says Safaricom is guided by codes of ethics which are strictly observed. “There is always a better way of doing business,” he notes. “I made an individual effort to declare my wealth on the company’s website. The media picked it and became a hit, Since then.”
Interestingly, the firm has adopted a unique model with regards to gifts and souvenirs dished at its members. Every gift received
from clients or partnersis registered and placed in a central place and staff bid for it online. The highest bidder takes it and the proceeds go to Safaricom foundation’s kitty. “We do not give out gifts, if we do, it is a simple appreciation in form of a calendar or a notebook,” he reveals.
Additionally, there are ethic champions across all levels of the organization who monitor malpractices. Mr. Collymore says: “If anyone notes unethical practices, he can approach an ethical champion who guides him on what needs to be done.”
Besides, Safaricom has an open-door policy of reporting the vices. He says everyone is encouraged to write to him. “Training staff on best practices is also crucial. Integrity, morals and behaviours of employees can make or break a company. We train our staff every year,” shares Mr. Collymore. Risk management It is key for any business which aims to fight unethical practices to have a robust risk management platform. It aids in curbing ethical misconducts. Safaricom works with both internal and external risk managers to ensure good conduct.
The firm also sits on the UN Global Compact Network which aims to promote good ethics. “That exposes us to the best practices globally. We also learn a lot from other leaders locally, for instance, Kapa Oil Refineries,” he says.
Effects He says, the effects of business misconducts are grave. Unethical behaviour may damage a firm’s reputation and make it less appealing to stakeholders. Profits could fall as a result. The incurred fines and damages can be so huge to an extent of increasing the cost of doing business. The loss to the economy too can be massive. Mr. Collymore finally paints a bright future on the fight against ethical misconduct if everyone would be committed to transparency and accountability.
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Executive Talk
The soft spoken executive shares his insights on success, leadership and entrepreneurship. He talks of how he formed a company from college, recruiting his peers and ultimately impacting lives through his innovations.
The Young Executive With A Midas Touch
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ne of the great stories in an otherwise bleak time for start-ups in their seminal years is the spectacular riseand continued success of Tangazoletu, a local fintech company based in Westlands, Nairobi Kenya.
The financial technology company with a Swahili name shot right out of the gate upon its launch in 2005 in a college room.Back then, Chris Gathingu would not have envisioned his nascent idea would become a disruptive innovation. And despite the turbulent spell occasioned by start-ups in their formative years, the company has thrived, growing in both influence and clientele as it celebrates its decade in existence. In 2009, he developed a revolutionary mobile banking solutions for Saccos that grew to become SpotCash Mobile Banking. It is now being used by over 60 financial institutions and a key cash cow for Tangazoletu. In 2010,
the company partnered with Safaricom as a local product development partner to innovate and grow M-Pesa. This partnership gave birth to products like ‘Lipa na M-Pesa’a merchant settlement service that handles over Ksh 150 million daily among others. Tangazoletu also developed the finance and payment component of TIBU, a national TB management platform used by the Ministry of Health and funded by USAID. TIBU is in use in all the 47 counties in Kenya.
Chris Gathingu is the founder and chief executive of Tangazoletu. The Kenyan national, born 33 years ago, recalls developing interest in computer and programming as a first year undergraduate student of Computer Technology at Jomo Kenyatta University of Agriculture and Technology (JKUAT). Upon graduating in 2007, he had already settled on his career options- to develop his start-up and nurture his entrepreneurial ambitions. He later employed three of his classmates and a marketer. Chris now sits at the
Chris Gathingu, ceo and founder, Tangazoletu.
USD 15 million
Chris now sits at the helm of a company handling over USD 15 million worth of projects. helm of a company handling over USD 15 million worth of projects. In 2014, he was nominated and selected as one of Kenya’s top 40 under 40 men for his business acumen and leadership skills. I recently caught up with Chris to get acquainted with his story, the impact of fintech revolution and what accounts for Tangazoletu continued rise. So you started a company with less than USD 2000 while
in college? A rookie for that matter, how confident were you at the time? “It is interesting how I started out. I was visiting a relative and found out that her water supply had been cut off. We later realised that the postal bill had been delayed and she had not paid in time. It struck me as a problem and I instantly envisioned that I could develop a solution for it,” recalls Chris.
He further says that the opportunity was too perfect for him. “With less than USD 2000 I was able to develop the solution and put the necessary structures. I came up with an automated SMS based platform for mobile phones where companies would send the bills to clients. I sold the idea to a Water Supply company and they were fascinated. I was paid
processes. Like Marsabit Teachers Sacco knew us for introducing a revolutionary mobile financial solution, SpotCash that is now in use nationwide. SpotCash platform answered most of the predicaments they were facing at the time. They now disburse funds to members in a fast and efficient way. It is secure and has greatly reduced operating costs.”
my first cheque and my journey started there and then.” From then on, he vowedto be different. He was visionary about innovation. Inspired by societal need and developing relevant solutions was perfect for him. This formed the basis of his company. From humble beginnings, he has remained true to his resolve. His journey has been organic, something which defines him.
Years later, he is constantly innovating new products and services putting the firm ahead of the next practise.
Household name Having set a steady foot, he is happy that the firm is now a household name in its line of business. He shares: “We are known to provide solutions that simplify business
It is against this background that the firm has continued to front the market, engaging in initiatives that have transformed businesses and lifestyles. For him, he articulates that it is fulfilling to see his innovations impact lives and livelihoods. He points out to the firm’s partnership with Ministry of Health, USAIDand other consortium members to combat TB as being exceptional. Through the partnerships, the system, TIBU dispenses Ksh 500 to a patient every day. It has enabled patients to get their daily grants to manage their conditions as well as promote accountability of funds. Motivation is mostly inborn But the executive remains unfazed by these accomplishments and points to an inborn drive to succeed. He affirms that it is stronger to some people than in others. “After being paid my first cheque when I was still a rookie, I projected that with a relevant solution to a pressing need, anyone could embrace it.” He saw many opportunities in the market that he could capitalize on and realised that he could not do it alone. He thought ofa team, and settled on his classmates to begin with. Chris had beenwith them for a while and knew that
they would be of invaluable help. With shared dreams and aspirations, they set to conquer the world.
Chris interests in computers also gave him an early start. He scored A – (minus) with 77 points and dreamt of pursuing medicine. He missed admission to a medical school by a point and was otherwise enrolled for a computer technology degree at JKUAT. He felt in love with computers from the moment he set his hands on them at college. 5 years, he later graduated with top honours. In view to stay relevant and acquire additional professional knowledge, he enrolled for Masters in Information Systems Management and graduated in 2013. Amongst other courses, he graduated from Strathmore Business School in 2015 with Owner Manager Program (OMP) System Management. This, among other qualities,comfortably places him at the leadership of the company. He gives guidance and direction on what needs to be done. “I passionately hold the vision and future of the organisation. I foresee future trends and share it across the organisation,” he affirms.
On the outlook for? “We visualise clearly what we want and where we want to be. For us money is not the key driver, but a by-product of adding value to society. We still have a lot to achieve but we constantly monitor market trends and adapt to them. Currently, we have a three year strategic growth plan. Having set up Tangazoletu Uganda - an affiliate office in Uganda, we aim to expand our reach to Rwanda, Tanzania and Ghana among others. We are also
diversifying to new markets such as health, agriculture and manufacturing, and hope that the future would be welcoming,” he ends. In his own words Entrepreneurs are known to create paths where none exist. I wake up at 5 am, exercise for 30 minutes and take control of my day. I get to office by 7.30 am and leave by 5 pm. Out of ten attempts I make at something, I roughly succeed in three. At the start, I tried selling a mobile payment concept to banks and multinationals but was turned down and offered a job instead. Young people should stop thinking of capital as an impediment to success, but rather the idea they have and their execution. There are many things in life that may not work out for you, but change tact and get around it. After high school, I desperately wanted to be a doctor and walked over to University of Nairobi to convince them to enrol me despite having missed the cut by a point. I now have a lovely wife and two daughters, and I cannot stand the sight of it when I take them for an injection at hospital. My wife is really supportive. More often, she gives me advice and thoughts on business, leadership and life. I value family, friends and my social circles. I value social good and community engagement which I mostly do through mentorships. Words Sylvester Okumu
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Paul Wambua, chief executive, Stima Sacco
Main Story
STIMA SACCO LIGHTS-UP MEMBERS EXPERIENCE WITH EXCEPTIONAL PRODUCTS The leading Sacco bets on innovative products and exceptional service delivery to redefine customers experience Words Jenny Nyawira
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S
avings and credit co-operative societies (Saccos)area swiftly expanding market segment. They play a key role in social and economic development of countries across the world. In Kenya, Saccos have been a financial inclusion success story. The country has one of the largest co-operative movement in Africa characterized by players that are irrevocably changing the way consumers, businesses and organizations interact with each other. The leading players are becoming more dynamic and innovative and are interested in solving financial problems affecting the society, whether it is by changing the current customer experience or completely bypassing it. Saccos have a role of changing lives as well as the society at large by promoting economic interest for their members, and in particular, offering them opportunities to save money and access credit. Stima Sacco is cut from the same cloth. It has been fronting the market since its establishment four decades ago.
Established with the sole objective of enabling employees of the then East Africa Power and Lighting Company, to save and access affordable credit, the Sacco has grown in leaps and bounds drawing membership from allother sectors of the economy. The Sacco is now a leader in financial service provision, particularly in the Sacco sub-sector.
Located in Ngara, at the outskirts of Kenyan capital, Nairobi, the Sacco now has presence in Mombasa, Kisumu, Nakuru and Olkaria. It has the mandate to redefine the financial wellnessof its members andlooks forward to becoming a one stop shop for its member’s needs. “We have an ambitious expansion plan that seeks to increase our presence in the market as we strive to grow our revenue
Main Story
streams as well as increasing the wallet size of our shareholder,” opens up Paul Wambua, Stima Sacco’s chief executive officer.
Exceptional products In today’s competitive business environment, companies are seeking ways to leverage technology to gain a competitive advantage, cater for the needs of a mobile workforce and mobile customers while mitigating security breaches and threats. In order to do this, companies are now relying more on the ability to optimize their IT operations, enhance their portfolio and leverage costs to gain market share.
This has led Stima Sacco to see the vast hidden opportunities in this ever-growing digital convergence to improve customers’ experience. “We have introduced a plethora of products and services that are tailormade to suit our clients’ needs,” Wambua reveals. One of the products is E-Membership, a platform that allows Kenyans to become members of the Sacco through E-Registration. To access and register as a member, one needs to dial *489#. The Sacco also has M-Pawa advance, a revolutionary product that allows members to get credit using their mobile phones. The M-Pawa app also allows members to check their balance, transfer money both internally and to other members, buy airtime directly from the prime account and make customer enquiries.
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Saccos offer a platform for the country to grow its savings reserves as they encourage the culture of saving through their models of operations
In addition is Makazi Poa, a mortgage product that is tailored towards giving members an opportunity to own affordable housing and land.
Welfare benefits play an important role in the lives of employees, customers and their families. Healthcare benefits are the crown jewels. For that reason, the Sacco provides health insurance to its members. It partnered with Jawabu Micro-health to provide a flexible medical insurance cover that has a range of benefits including inpatient care for dental and optical conditions, congenital conditions,
*489#
To access and register as a member, one needs to dial *489#.
Competitive edge Currently, with so many players providing saving and credit services to the urban and rural population in Kenya, there is no doubt that the market is characterized by cut throat competition. Through the support of the government as well as their popularity, more and more new players are entering the industry with more innovative products. Moreover, the financial market operating space is homogenous. In that regard, providing excellent and quality customer service as a differentiating factor is paramount. As one of the leading Saccos in the region, Stima Sacco has created a competitive edge by providing trusted customer service. It also employs research and development to ensure that it understands the market dynamics as well as customer tastes and preferences.
“At Stima Sacco, we have a customer centric approach to service delivery. We strive to meet the customers’ needs in everything that we do,” says Wambua. The Sacco strives to meet customers’ expectations by providing solutions that are tailored towards their needs. “We do our utmost to ensure that our customers are empowered in whatever they need. The bottom-line is increasing their wallet size,” he adds.
pre-existing chronic conditions such as HIV/AIDS, psychological and psychiatric conditions and funeral expenses.
Furthermore, maternity issues are catered for, as well as post hospitalization within 3 weeks of discharge.
Recently, Stima Sacco launched an innovative trade financing product dubbed ‘Stima Sacco trade guarantee.’ The product is designed to facilitate business growth through timely solutions that make it easy for business people to undertake seamless business transactions. Through
the product, members are able to access bid bonds, performance bonds, advanced payment guarantees, LPO financing as well as Invoice discounting.
Other than that, the Sacco offers a wide range of savings and credit products. The products are tailored to meet various needs of a diversified membership with each member’s unique needs being catered for. This is in line with its vision of being a market leader in the provision of world class financial services.
Operating space “The space is now liberalized and the traditional Sacco model is under extreme threat. As a result, Saccos need to devise means of navigating into this extremely competitive landscape to service,” quips Wambua. There is also the issue of Telcos offering financial services to Kenyans. Against such a background, only Saccos that will embrace change shall survive.
In spite of that, it is unquestionably true that the future of Saccos is bright. They will contribute towards achieving vision 2030 since they provide alternative banking to millions of Kenyans. “Saccos offer a platform for the country to grow its savings reserves as they encourage the culture of saving through their models of operations.” By and large, Saccos have an ultimate role of facilitating upward socio-economic mobility.
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Main Story
If banks don’t embrace cultural change they will be overtaken by tech companies- Morgan Stanley Words John Kageche
With Disruption In The Financial Sector, Saccos And Fintechs Are On Shifting Sands
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ontrary to popular belief, the Sacco movement in Kenya is shrinking. This has been most profound with the advent of the rapid technological changes in the past decade or so;initially the Internet, then the ubiquity of thecell phone, followed by M-Pesa and now the smart phone.Na bado!(more is coming). The Communications Authority of Kenya2015/2016 Q1 Sector Statistics reportshows that mobile subscriptions grew to 37.8 million during the quarter in Kenya. In addition, mobile penetration grew to an impressive 88.1 per cent and internet subscriptions hit 21.6 million, meaning a penetration of 74.2 per cent was achieved during the same period. This aside, it is estimated that by 2020, there will be 50 billionconnected devices with mobile phones being the primary access to internet and 80 per cent of the world population will have access to a mobile phone, 60 per cent of whom will be through a smart phone or low cost tablet.
With Kenya being known globally as the Digital Finance Success (DFS) story, your guess is as good as mine on what this means for the economy in general and the financial landscape in particular. And to be sure, the financial industry in Kenya has grown to include telcos’ and financial technology firms (fintechs). Therefore, the Sacco and fintechs, cannot continue seeing themselves as spectators, but as active and endangered players. Breath of fresh air Based on an FSD (Financial Sector Deepening) Report, entitled, Savings for the Poor in Kenya, driven by technology, banks and MFI’s have moved sharply North, and Saccos taken a plunge, re financial penetration. What makes this revelation dire is that Saccos are a cornerstone to the success of Vision 2030. Saccos are meant to be the primary
the speed money is transferred on M-Pesa. Technology is hip, ‘young’, and perceived ‘risk-embracing’. A perfect remedy for attracting a bulging youth. A year ago, it would have taken 90 days to open a bank account and apply for a loan. Today, with KCB-MPESA this can happen in 9 minutes flat! Small wonder then that in the September 2015 copy of The Banker magazine, Sir David Walker, ex-chairman of Barclays and Morgan Stanley said that, “If banks don’t embrace cultural change, they will be overtaken by tech companies.” He might as well have been referring to Saccos.
vehicle through which Kenya mobilizes savingsfrom the paltry 16 per cent to the desired 30 per cent, And for this to happen, I believe there must be a revolution in the Sacco movement. As such, the M-Pawa app by Stima Sacco and the remote registrationDigital Sacco (both mobile driven) are a breath of fresh air. The genesis of the Sacco movement is social, and for decades has been successfully buoyedby this. Yet this very ‘socialism’ ironically has been the movement’s nemesis. It has become the Saccos corporate culture. I believe that the conservative and ‘perceived as old’ nature of being‘social’, is the very reason why Saccos were overtaken by technology at
The boldest move by Saccos in their decades long history was the starting of the FOSA (Front Office Services)in the 90’s and breaking of the common bond, in 2003 (that is allowing Saccos to seek membership outside the traditional captive market, usually employees in the same institution). Looked at in isolation, this is revolutionary yet in fast-paced DFS Kenya this is old-hat. If in doubt, look at M-Shwari that was crafted along the Sacco model-save three months and borrow. The only difference is that no guarantors are involved. Still, M-Shwarirevolutionized borrowingto the tune of escalating CBA from 18th position (and Tier 2) to pole position (and Tier 1) by customer base in little more than twelve months and spawning other borrowing platforms. Where were the Saccos when their model was copied? SASRA (Saccos Society Regulatory Authority) ranks Stima Sacco third by asset base.By many counts,Stima Saccois progressive, and under the stewardship of Paul Wambuacontinues to experience growth of an average of 15,000 members annually. On its own, commendable growth; compared to Mshwari that,according to the Business Daily, registered almost 1M members in one year, the potential of astronomic penetration while leveraging on technology within the Sacco movement becomes seen in clearer light. Fintechs In these times of rapid change, financial technology firms may themselves be overtaken by technology. And why? With low barriers to entry, rapidly increasing power of buyers and rapidly diminishing power of suppliers, coupled with intense industry rivalry and continual threats of
substitution, fintechs should not sit pretty either.
A decade ago, to start a fintech would have required a comparative massive input in resources. Today, all I need is a bit of coding knowledge, a laptop and the Internet which is why, “Fintech start-ups are already quietly and rapidly crawling inside banks (and Saccos) like armies of ants, often unnoticed, through small holes at the corners of old rickety doors and windows, weakening hinges” (LinkedIn. Brackets mine). Then there arei-Hubs (allowing ‘safe’ and much cheaper, rapid experimentation), Open Source and Cloud technologies.You canaccess Gmail or Yahoo email anywhere globally. Imagine replicating the same to a Sacco or bank. It is possible with Cloud. With Cloud, all the infrastructure (IT systems) of a financial institution can be availed online for instant deployment (i.e. plug and play). Open Source means that there are programmers who are happy to write competitive software and avail it online for free. Yes, that is right, what to one is a core business, to another it’s a hobby. So? You ask. Well,as common place as it is today, fifteen years ago, creating office email was revolutionary, yet those who did it used Open Source. Today, Open Source itself is common place. According to the International Data Corporation, as at the end of 2015, 85 per cent of smart phones globally (probably yours included)ran on the Android platform. Android itself is, and is designed from, Open Source software. The young man who manages my website reconfigured his own version of Android for his phone and gave it out to the online community. All for free. Sharing is the in-thing now. What this means is that where once maintenance was a source of income for fintechs, now an entire and ever growing online community is happy to share problems and practical solutions for free. What does all the foregoing mean? That exciting and turbulent times still lay ahead, and Saccos, banks and fintechs cannot sit on their laurels. Kageche runs the provocative and thought-provoking leadership program, ELECTRC (Exploring Leadership In a Time of Rapid Change);lendmeyourears@consultant. com, www.lendmeyourears.co.ke
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Customer Service
The only way to become rich is to put all your eggs in one basket and then watch that basket–Andrew Carnegie Words Carolyne Gathuru
Put All Your Eggs In One Basket And Watch It
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his quote by Andrew Carnegie pretty much sums up the relationship we all have with the financial institutions we entrust with our money. The real paradox being that although we trust them enough to channel our monies there, we actually don’t entirely trust them to keep it safe, grow it, transfer it and handle it like we would. If there was a way to keep watch over it and have our money safely with us and in our care, there would be lots of personal home banking solutions. Based on the premise that customers handle every transaction and interaction with a lot of suspicion and lack of trust, the players in the financial sector have an even bigger hurdle when it comes to ensuring service excellence. Providing an enjoyable customer experience must be layered upon a foundation of solid trust. Then only can how the customer ‘feels’ be addressed. There is absolutely no way providing courteous and considerate service can triumph, if a customer has the notion that the
institution is not handling their money well or is trying to fleece them.
Formal culture Traditionally, financial institutions including banks, Saccos, microfinance institutions and players in the insurance industry, have been very somber and sober institutions that have deliberately developed a rigid and formal culture. Some even going as far as dictating that the personnel don dark serious colours, for no one would ever trust a staff garbed out in a bright red suit, to effectively handle their money. Partly also because where money is concerned, the need to demonstrate seriousness and to report full compliance with legal and regulatory requirements has been the overriding factor.
This is now changing and the faces of institutions that handle customers’ money have become friendlier and customer focused. Money transfer services whether applied face to face or vide online technology, are striving to put forward interfaces that connect with customers at a personal level. The shop floors of banking halls now have customer comfort orientations to make waiting time and customer interactions more pleasurable. Financial institutions are now stepping up to carve out a niche and define their brands in alignment with being friendly, innovative, fun, young and dynamic. The previous need to be seen as solid, serious, efficient, competent and stoic, has been replaced with creating a unique identity. Those qualities have become a given. An almost basic requirement for anyone playing in the financial space, with customers expecting those as the baseline and to then see ‘what more’ their financial partners can offer. The new differentiators revolve around ease of access, accessibility,
simplicity and consistency.
Customer’s experience The 2015 Service Excellence Awards survey run by The Institute of Customer Service in Kenya,based on direct feedback from the public, saw customers in the financial sector point out that the key areas that govern their preference of one institution over another include: provision of customer friendly and innovative solutions; providing timely communication on new products, services and changes; and responding to customer enquiries in a patient and informative manner. It is worth noting that none of these key parameters revolve around ‘keeping the customers money safe’ or ‘ensuring no transactional or impropriated losses’. It is the customer’s expectation as they engage with any financial partner that at the very basic, their money will be safe and that a provision will be made for the customer to track, trace and
‘watch’ their money on demand. As an institution involved in money lending, keeping, transfer, trading, holding or investment, building customer trust is paramount. It forms the very foundation of customer engagement and retention and should be the base blue print upon which the institution’s customer service strategy sits. All company operations should be deliberate about exuding this trust and the culture of eliciting trust from customers should be ingrained right from the top to the frontline and support staff. It is on the basis of this trust that should there be a mishap or a technical hitch that customers will be willing to give the benefit of doubt and allow for reversal or recovery.
Communication out to customers designed to inculcate trust must be applied across all customer communication platforms. This must be evident in all communication both written and verbal with the same theme running through these interfaces. Integrity has become quite the sham, with institutions having been busted embezzling resources, sporting customer service charters and mission-vision statements on their walls with ‘integrity’ outlined as their overarching value. Despite the pressure faced from both old and emerging competition, the high expectations to outperform other players in industry and the need to be constantly on the move to innovate to have customers continuously channel their precious financial resources through for management from end to end, financial institutions must never lose sight of the most fundamental element that has customers loyally bound. TRUST. For as J.P. Morgan postulates - “The first thing in credit is character … before money or anything else. Money cannot buy it.… A man I do not trust could not get money from me on all the bonds in Christendom. I think that is the fundamental basis of business.”
Carolyne is an accomplished brand, marketing strategist, and the founder of LifeSkills Consulting. She is an ardent customer service practitioner with over 15 years experience. Email: cgathuru@life-skills.co.ke
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Marketing
In 2015, Facebook had more than 1.59 billion active followers. Similarly, Twitter had more than 305 million active users on monthly basis. Words Peter Kamande
Why Social Media Marketing A Game Changer For Businesses
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ithout a doubt, social media marketing presents one of the greatest opportunities for businesses of all sizes. For majority of the companies across the globe, there is the slow realization that the traditional methods of marketing such as print media (newspapers and magazines), television and billboards among others are not effective enough as they were in the past. Recently, the speedy growth of social media platforms such as Twitter, LinkedIn, Facebook and Instagram among others has changed how businesses operate. Research shows that as at the end of 2015, Facebook had more than 1.59 billion active followers, a 50 per cent increase as compared to 2012. Similarly, Twitter had more than 305 million active users on monthly basis, and this number is expected to grow exponentially going forward. With this wide market niche, companies are realizing the
extent to which marketing through these sites can help them strengthen their balance sheets both in the short and long-run. This is especially for the small and medium enterprises, which normally lack adequate capital to advertise in the traditional platforms that are characterized by high advertising costs. From a survey conducted by Regus, renowned firm offering work place solutions for businesses across the world, 43 per cent of the businesses in the United States have successfully used social networking sites to win new customers. In Kenya, large and small companies such as Safaricom, Kenya Power and banks among others have embraced the sites to market
in mind, social media networks serves as perfect tools for which firms can increase their brand’s voice as well as content. Through this, it becomes easy for a company to attract new customers as well as increase recognition to the existing customers, a factor which boosts sales. For instance, in Kenya, media houses such as KTN, Citizen, and Capital FM among others have perfected this art, thus raising brand awareness. It is also worth noting that social media presence is key in enhancing web optimization which contributes to better ranking. Secondly is enhanced brand loyalty. As indicated in a report published by the Texas Tec University, USA, brands taking part in social media channels have improved levels of loyalty from their customers. In other studies, it was concluded that 53 per cent of Americans following specific brands on the social sites are loyal to these brands, thus increasing the sustainability of the firms. Furthermore, marketing through the social media sites is cheaper compared to the traditional methods. In fact, promotion and sharing of content on these sites is free of charge, thus reducing operation costs for most businesses. The sites also offers advanced, but affordable platforms to advertise, thus becoming easy to target customers by the use of keywords, demographics as well as campaigns that are interest-based.
as well as solve customers’ queries, thus greatly improving brand loyalty.
Why social media platforms? There are various ways in which social media marketing can significantly play a major role in the success of businesses across any sector.
To start with is brand recognition. It is notable that, each opportunity a business has to increase the level of visibility in terms of content is highly crucial. With this
Richer customer experience is another advantage. Just like other channels of communication such as phone or email, every opportunity when a customer interacts with a company on the social media, it is always an opportunity to publicly demonstrate the ability to enhance customer experience. For example, if customers present their complaints regarding a product or service offered by a certain company on such platforms, it is only in order for the company concerned to take the right action as this may have long term implications.
Hurdles of using social media marketing In spite of their benefits, there are numerous challenges which a business may encounter while marketing products
or services through the social media. One of them is engaging with the audience. While it may seem an easy issue to handle, there are protocols which companies should adhere to while dealing with the audience on the social media platforms. For instance, if the negative feedbacks are poorly handled, they may greatly damage the brand name, thus affecting turnover. With this is mind, companies should develop a well sound social media strategy in order to steer through the challenges.
Measuring the effect of social media marketing on business While there exist elaborate methods to measure the impact of marketing through the traditional methods, such methods do not exist while it comes to social media. First, there is the challenge of turning followers into customers. Also, the best tactics to use in order to have a large market niche on the social media is a major issue. These challenges remain a headache, thus adequate research on this area ought to be carried out to help these companies. Other challenges include privacy issues, adapting best practices as well as the amount of time which a firm should devote to social media sites.
From the above, it is clear that social media marketing remains a notable form of marketing for all businesses. If properly managed, it can greatly reduce the operational costs, as well as offer companies timely opportunity to interact with their customer. This will go a long way in improving the brand name, thus ensuring their sustainability both in the short and long-run. Mr. Kamande is a professional research writer. Email: pitaah2010@gmail.com
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Personal Branding
In the business world people will form judgments about your education, intelligence, background, and personality simply based on the language you use to express yourself. Words Derek Bbanga
The Language of Business
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n the business world people will form judgments about your education, intelligence, background, and personality simply based on the language you use to express yourself. Poor language skills can create barrier to interpersonal communication. The language you use in business reflects your thoughts and beliefs. It creates an impression of who you are and influences how you are perceived. Your language serves as signals, communicating your thoughts, feelings, and attitudes.
You have heard is said by people who make the odd gaffe while speaking English that it (the English language) came on a boat. Well, if only we had the Somali pirates back in the 1800’s then maybe we would not be having this conversation. We can either love it or lump it, but English is the language of business communication in this country in addition it is also critical in doing business internationally because it is the language of most business around the world. This brings up
Speaking in a language that other people do not understand in a professional setting is a big
‘NO NO’
interesting questions like whether slang or in our case Sheng is acceptable in communicating in business? What about those organisations that have their own unique jargon and meanings? I’m asking how much we should be allowed to take liberties in the world of business with the language we use in communicating. The answer is simple, read the situation and equip yourself with the language to suit all occasions.
At one of my recent training workshops, as I was setting up in the conference room and participants were walking in, two of them entered chatting in their mother tongue. After saying their hellos to some of the other people who had arrived earlier and introducing themselves to me (in English at least), they continued with their conversation in their native language while we waited for the rest of the class to show up. I made a point of pointing out during my session that speaking in a language that other people do not understand in a professional setting is a big ‘NO NO’. Even in a personal setting if there are other’s around who may not understand your language then the choice is simple, do not use it. At some of my previous job both here in Kenya and in Europe (might I add). I would constantly have people speak a language I did not understand in front of me. While I understand that it is natural to want to speak in your mother tongue, people should realise that it makes other people uncomfortable. It might make them wonder if you are talking about them or about something that you do not want them to know. I am not ruling our ever speaking in our native tongue at work, for example your client may not speak English that well after all cultural awareness is a hugely important aspect of business interaction. Business Jargon Ever leave a meeting and wonder how you survived the last hour because of all the mind-numbing business jargon being bandied about? After all, the meeting could
have been a simple affair to merely touch base, circle the wagons and get people working on the same page. Instead, the low-hanging fruits gets ignored and limits everyone’s bandwidth. It’s an issue that can bedevil otherwise effective people from soup to nuts and keep them from becoming the kind of game-changing paradigm-shifters that companies need to take it to the next level. Using jargon is actually a lazy way of communicating, and it is often used to dodge serious issues or questions and very often leads to clouding the intended message. My advice is less is more, simply the message, say what you really mean and use concise English. Lost in translation Be aware especially when using written English not to get ‘lost in translation’. This is what happens when people communicating across the language barrier because of different culture or even cross generation communication. This may end up disastrously wrong or sometimes with quite comical results. I see this quite a bit when reading something that has been translating something directly to English from someone’s mother tongue, like this gem I read in a hotel recently-‘Visitors are expected to complain at the office between the hours of 9 and 11 A.M daily.’
You may adapt your language such that what you use at a board meeting may differ than the language you would use if you would say running into a colleague at an out of office event. But whatever language you use at work look to be succinct yet thorough and to communicate in a manner appropriate for the occasion to avoid possible misunderstandings offense and disharmony. Decide on the impression you want to create and choose your language accordingly. Derek helps professionals improve their soft skills for business. He can be reached at derek.bbanga@ publicimageafrica.com and follow him on twitter @derekbbanga
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Career Development
Millennials: Burden, Blessing, Or Both? Source: McKinsey & Company
C
ompanies often complain about the unrealistic expectations of millennial workers, but heeding their call to action can improve the work environment for everyone.
We recently came across the following quote about the younger generation: Because all the peoples of the world are part of one electronically based, intercommunicating network, young people everywhere share a kind of experience that none of the elders ever had. . . . This break between generations is wholly new: it is planetary and universal. Cultural anthropologist,Margaret Mead, wrote these words in 1970. They are an important reminder that older generations often see stark differences between themselves and up-and-coming ones. We’re seeing the same pattern play out today: the youth have been christened “millennials”—workers who are said to be difficult to manage and likely to quit at a moment’s notice, and to make needless mistakes as they forge ahead blindly.
The research we’ve conducted suggests a more complex reality. Yes, the youngest generation differs from the older ones. But this has always been true. Can you define everyone born between 1980 and 2000 by a handful of generalized characteristics? It’s time for leaders of organizations to stop debating the millennial problem, hoping that this supposedly exotic flock of sheep will get with the program. Instead, they should see how questions and challenges from their youngest employees can spark action to help their companies change for the better. It’s easy to say that young people haven’t matured enough to
resign themselves to the reality of what’s possible. Yet they are asking an important question: “Why does it have to be this way?” In the process of listening, leaders will soon realize that young people want the same things we all do.
In 2015, Joanna conducted 200 in-depth interviews with highpotential young professionals and an additional 60 with talent professionals-looking for ways to engage younger employees effectively. We’d acknowledge that this research is qualitative, but it covers 120 companies, including 55 of the Fortune 500, across many industries. The sample primarily draws from millennials in the United States but includes multinational perspectives: more than 40 percent of those sampled were immigrants from over 40 different countries. The emerging themes were consistent enough to make us feel comfortable sharing our observations and early conclusions from them. For starters, these interviews underscore what shapes this generation: even high-performing young professionals acknowledge the harsh economic realities they’ve seen and the stress they experience. Many in the United States continue to bear the burden of thousands of dollars in student-loan debt. Coming of age amid the global financial crisis, they have also observed firsthand the weakening of the social contract as corporate scandals stripped workers of their pensions and companies cut costs or closed their doors, leaving committed
high expectations of young employees but meeting a larger need for more thoughtful relations between all workers and employers:
• Build bridges with data. People analytics has been gaining momentum in a wide variety of organizations, but few have thoughtfully used research to understand their youngest employees better. P&G has deployed its consumer-marketing expertise to learn more about them and to generate ideas that help middle managers to shift their own mind-sets and adapt their management approach. They’re far from alone; some companies are gathering data to understand not only their youngest workers but also the entire workforce— tracking tenure, movement, performance evaluations, and attrition, as well as qualitative data to gauge engagement and find ways of increasing it.
workers and their families financially vulnerable. This has influenced their decisions to join or leave companies and sharpened their desire to find meaning and purpose in the chaos of the world in which they’ve grown up.
Millennials also speak of themselves as hyperconnected globally—always on— with resulting work behavior that seems peculiar to some of their managers. But this natural affinity for technology provides them with unique skills and insights that managers can use. They’re efficient, and they also see patterns not always evident higher up the hierarchy. Unleashing the Potential of Young Employees Young professionals don’t want to be patronizingly singled out; they just want to create the kind of environment that many older employees have longed for but never found. Any one of these actions would be a significant shift from business as usual. Collectively, they represent a new workplace dynamic spurred by the
• Put communication on steroids. Many companies have learned that employees are eager to hear from top management. But the young ones in our research expect this to happen at a hyper-speed. Here, tech firms are leading the way. HubSpot, a marketing-software company with a recent IPO, conducts surveys of its mostly millennial employee base every 90 days and reports the raw findings, along with analysis, to all employees. This approach provides unprecedented visibility into issues and solutions—and changes the rhythm of continuous improvement.
• Develop a culture of mentorship. Personal relationships are crucial for companies anxious to hang on to their young workers. W.L. Gore’s use of this approach is a classic example: all new employees are assigned a sponsor who helps them to navigate the culture; to reach out and form other mentoring relationships, based on work interests and chemistry; and to be successful. • Get creative about professional growth. Many young professionals want a chance to flex their entrepreneurial muscles; they chafe at the lack of advancement opportunity in today’s flat structures. Any kind of movement that promotes professional development is a plus.
• Make flexibility more than polite talk. Young employees, unlike their older coworkers, value the genuine blending of their work and personal lives. Leaders may be apprehensive at the prospect, but there are simple ways to make flexibility work. Journeys, a leading specialty retailer where young workers make up a large majority of the workforce, has created a core time block when all headquarters employees must be in the office unless they are on the road for work. In return, employees are responsible for their results, regardless of their work hours • Shape midlevel managers into leaders. Middle managers are the first line of supervision that young employees meet. That encounter can be disastrous. But it also can be edifying if the managers are prepared to handle pivotal scenarios, such as giving (and receiving) more frequent development feedback, managing difficult situations, and learning to adapt to challenges. Young employees are part of the solution. They can learn how to broach issues with the empathy that comes from standing in the shoes of their managers, to pose questions that foster solutions rather than more problems, and to pause and thoughtfully engage with their elders before moving on to action.
But that’s only the start. We understand that implementing most of our recommendations will be challenging. They change the nature of work, establishing a new standard for the way leaders, managers, and employees interact. Companies will therefore not only more effectively retain young professionals, who may eventually become their leaders, but also increase the engagement of all employees across the organization.
We’re also optimistic that young people can help show the way, not because they are so different, but because they are expressing common human needs and raising relevant questions about why more progress hasn’t been made already. Leaders who listen, have long-term horizons and the courage to break new ground, can improve their odds of building a lasting legacy that serves generations to come.
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Entrepreneurship
Cytonn Investments brings entrepreneurs together with an aim of sharing experiences on how to start sharp and thrive
Thriving As An Entrepreneur
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ecently, Cytonn Investments brought together more than 200 entrepreneurs with the aim of driving the spirit of entrepreneurship in the country. Cytonn Entrepreneurs Forum is an initiative of the Cytonn Foundation, which focuses on developing entrepreneurship as one of its causes. The forum aimed at developing and assisting more entrepreneurs.
Edwin Dande, CEO and Managing Partner, Cytonn Investments speaks to a group of young entrepreneurs during the forum.
The theme of the forum was “starting and thriving”. It focused on shedding light on financial literacy, entrepreneurship as well as training and mentorship. The interactive session also added up as a networking opportunity. The forum was graced by a panel of distinguished entrepreneurs who focused on sharing their perspectives on what it takes to start and grow a business. They also inspired the audience with the tough lessons learnt during their entrepreneurship journey.
Among them were Mr. Edwin Dande, Cytonn Investments Managing Partner and chief executive officer, Julian Kyula, chief executive officer and founder of Mobile Decisioning (MODE), and Sam Thenya, Founder and chief executive officer of Nairobi Womens Hospital and the Women Recovery Centre. The session was moderated by Terryanne Chebet, renown business news anchor/associate editor at Citizen TV Kenya.
“
Being an entrepreneur is putting your face to be slapped every day
Apparently, entrepreneurship and small businesses remain the core engines of growth in any diverse and growing economy, hence the biggest determinants in job creation and uplifting the standards of living.
“80 per cent of jobs come from small enterprises,” said Mr. Dande, adding that “Cytonn’s journey has been a journey of entrepreneurship and that is why we focus on helping entrepreneurs, sharing our story in order to inspire people.” Dande said that Cytonn Foundation will be hosting the entrepreneurship forums every quarter- with the aim of supporting entrepreneurial culture in Kenya.
He further revealed that Cytonn started with a team of five and now the number has grown to 120 people. The company focuses on alternative investment solutions that are based on four main products: real estate, structured solutions, private equity and advisory. As discussed by the panelists, knowing whether you have the right idea at hand is paramount. According
to Dande, entrepreneurs must be observant about the things around them, identify the need in the market and endevour to make a difference. On the same issue, Dr. Thenya mentioned that thorough research should be done before starting a business.
Entrepreneurs should not just copy and paste since what worked for others may not work for them. “Replication of ideas will not make anyone stand out but new ventures will. To have a cutting edge, one must do what is extraordinary, differentiate oneself from others and show commitment.” The world is waiting for innovation.
Most people have passion and desire but timing may be a problem. “However, it is not all about the ideas, it is about how you execute them – that is what makes the difference,” revealed Mr. Kyula. “In terms of staff, you should employ people who are better than you, the moment you start believing your own hype, your time is up!” Kyula also offered that it is important to hire people whom you can learn from- stressing that being the founder of a business does not basically mean that you are the best in the field. Roles must also be clearly defined in the organization so that the founder or CEO does not become like a semi god.
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Entrepreneurship does not mean freedom of time as most people think; it is a 24-hour job that always requires attention
The aspect of funding, which affects nearly every entrepreneur, also came out clearly. According to the entrepreneurs, some of the major sources of capital are personal savings or investors. “However, as much as capital can be a problem, but it is not, if you come up with a great idea, money will always follow you,” Said Kyula. Dr. Thenya recalled how he saw a business opportunity and was completely unprepared financially. He wanted to buy a hospital that was shutting down. “I resigned from my job in order to get provident fund, sold my wife’s car, and brought investors on board. I got an investor who believed and invested in my idea in spite of not knowing me at all.” According to Dande, entrepreneurs must demonstrate that they are ready to commit their money in the business. For entrepreneurs to be successful, they must be ready to give all that they have. This shows they are totally convinced about the idea.
“Entrepreneurship does not mean freedom of time as most people think; it is a 24hour job that always requires attention.” The importance of financial literacy in an entrepreneurship cannot be overlooked. The question on when people should leave employment to become entrepreneurs arose. Nevertheless, it was noted that there is no right time to leave employment. TerryAnne Chebet, who is also an entrepreneur elucidated that it is vital not to ‘eat’ into the time of ones’ employer. “If you decide to start a business, you should instead have a working structure with employees as you remain employed.” Challenges facing entrepreneurs Other than capital, entrepreneurship comes with a myriad of challenges.
“Being an entrepreneur is putting your face to be slapped every day,” mentioned Mr. Kyula. Most, if not all, entrepreneurs get a lot of negativity from friends and family who always question their judgment. “You cannot control what people say about you,” offered Dande. He explained the value you add as an individual determines the significance people accord you. All that is needed for success in entrepreneurship is setting goals and fully committing to them no matter the circumstance that might arise on the way. Dr. Thenya revealed that he had to work extremely hard in order to deliver his promise to the investors. Despite the initial challenges he faced, he has managed to build Nairobi Women’s Hospital, which currently has 600 permanent employees. He also started a nursing school in 2015. “My success took passion, determination and focus on why I started the business.” Getting the right employees who are aligned to your vision is also difficult.
“To build a great firm, you need excellent people, culture and product.” In spite of these challenges, Mr. Kyula noted that entrepreneurship should shift from success to being relevant in the industry, adding that success is a journey. What matters is paying attention to the milestones one wants to achieve. Words Jenny Nyawira
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Securing Your Future
The firm unravels its commitment of helping people attain peace of mind through securing their financial wellbeing, now and in the future.
Alexander Forbes: Securing Clients’ Financial WellBeing
H
eadquartered in South Africa, Alexander Forbes Group is a specialized financial services business focusing on securing the financial well-being of its clients through institutional employee benefits and individual financial solutions. In Kenya, Alexander Forbes provides a range of services among them actuarial and administration services, investment consulting employee risk benefits and healthcare consulting, personal lines as well as business insurance solutions.
“Rooted in Africa, yet globally distinctive, our aspiration is to create wealth and protect our clients’ assets in a way that impacts positively on their lives,” says Sundeep Raichura, chief executive officer, Alexander Forbes Kenya.
The Alexander Forbes Group is listed on the Johannesburg Stock Exchange with Mercer as a strategic partner. Mercer is a global leader in talent, health, retirement, and investments. It helps clients around the world advance the health, wealth, and performance of their most vital asset – their people. Mercer has more than 20,000 employees based in 42 countries and the firm operates in over 130 countries. The financial services provider has had an impeccable and distinguished history in Kenya in the lines of business it operates in. “We have a proven track record, a capable leadership team that encompasses diverse talent, skills
Sundeep Raichura, Chief Executive, Alexander Forbes Kenya.
Ngao Milele The product is targeted at employers and operates using the concept of an umbrella scheme in which a number of employers may subscribe.
and vast experience packaged together to provide a service offering that is without peer in the Kenyan market,” reveals Raichura. That is reflected in its client’s base and market share which is by far the largest in Kenya and includes leading corporates, multinationals, listed companies, household names, regulators, small and medium enterprises and individuals.
In addition to that, Alexander Forbes provides impactful service by employing highly technical people to provide expert and innovative solutions which we deliver with simplicity. “We build longterm relationships with our clients in the knowledge
that we have to earn the value of trust to create a mutually enriching experience.”
Ngao Milele Recently, Alexander Forbes launched a new medical scheme targeting retirees. Dubbed Ngao Milele, it is a simple vehicle to save for post-retirement medical needs and secure medical cover at retirement. The product targets employers and operates using the concept of an umbrella scheme in which a number of employers may subscribe. During the period of accumulation of savings, Ngao Milele is designed on a defined contribution basis. Contributions are allocated to individual members’ accounts where they receive the returns earned on the underlying investments. Contributions to Ngao Milele are determined by each employer in consultation with their employees based on actuarial advice. The full cost of the contributions is typically met by the employees, although employers may opt to meet a portion of the cost as an employment benefit. The actuarial team at Alexander Forbes advises on the structure and level of contributions required to finance various desired levels of post-retirement medical cover. At retirement, an individual member has the option of taking year on year insurance cover from a panel of selected insurers, use a drawdown approach (typically for outpatient cover) or a combination of the two. The umbrella structure enables the plan to be run more efficiently as certain duties are centralised and more cost-effectively as “wholesale” rather than “retail” rates are payable. The umbrella structure means that there is less need for employers to become involved in complex governance and trusteeship issues. Ngao Milele brings together Alexander Forbes expertise in fund administration and management with the state-of-the-art administration systems, as well as health care and medical insurance enabling the
best service and product the market has to offer. Alexander Forbes understands the importance of having a medical cover at retirement and is pleased to offer a goal-based savings plan that enables employees to save for this purpose whilst in employment and lead a life of dignity as senior citizens. Indeed, few things are more precious than health. An unexpected illness or injury can create severe strain on individuals and their families when there is no medical cover to meet the costs of doctors, hospitals and tests. Yet this is the position that most Kenyans who are used to enjoying job-related medical covers whilst in employment find themselves in at retirement – a situation of typically no medical cover at the time when it is needed the most, inadequate savings and increasingly, inability to rely on children and family for support. The product is meant for anyone who wants to save for their medical bills at retirement. According to Raichura, the offer currently extends to employers but will be further extended to individuals.
Employers who choose to opt for Ngao Milele become participating employers in the plan through which their employees may save for their post retirement medical expenses.
Why Alexander Forbes? The financial service provider has significant strengths, making it a market leader in all the services it offers in Kenya. “Although we are an international company, our focus is in fast efficient local services tailored to our clients need,” observes Raichura. According to the CEO, Alexander Forbes is staffed with qualified human resource in possession of a wide variety of professional skills, and shares these skills in its value added servicing of clients. Staffs are enthusiastic, energetic, experienced and totally committed to excellent client service. The Company has seven qualified actuaries and a total staff complement of close to 150 in Kenya.
Furthermore, by understanding the client’s objectives and needs, the company provides value added services. “In particular, we do not believe in providing a “house” or “imported” view. By listening to our clients’ needs, we align our services to deliver the features and solutions that are most appropriate, reflecting the client’s objectives and socio-economic circumstances,” quips Raichura. The company also utilises cutting edge technology and systems to enhance value added service. “We believe that we are at the cutting edge of innovation in terms of developing the best methods of advising our clients on their key consulting issues.”
In terms of Ngao Milele, Alexander Forbes believes the product is uniquely designed to combine the best of the pension and insurance worlds – during the period of accumulation, an employee is enabled to save in a cost effective manner and during retirement, a member benefits from the best service and product the market has to offer. A member leverages off Alexander Forbes clear edge in administration during the period of saving and expertise in medical insurance and bulk buying power in retirement. The umbrella structure brings economies of scale through the centralisation of costs and access to wholesale rather than retail prices.
Milestones so far Since its establishment, Alexander Forbes has been able to achieve major milestones among them the development of the pioneer umbrella retirement benefits fund, launching of Ngao Milele post-retirement medical plan and was the first firm to conduct retirement fund investment performance survey- Alexander Forbes Consulting Actuaries Schemes Survey.
Going forward, Alexander Forbes is deeply committed to its higher purpose of helping people attain peace of mind through securing their financial wellbeing, now and in the future. To this end, it has been at the forefront of the debate on financial wellbeing in Kenya. The company’s brand has been synonymous with financial expertise and innovative yet reliable pensions, medical and insurance solutions.
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Microinsurance
The global microinsurance giant serves 17 million people in 15 countries across Africa, Asia and Caribbean with insurance, the majority of whom have never before been insured. Tughral Ali, Head of Africa, MicroEnsure unravels the firm’s love for low-income markets and what accounts for its continued rise in a dialogue with Edge magazine.
MicroEnsure’s Love For Low-Income Population
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ounded in 2002 by Opportunity International and supported by a multi-million dollar grant from the Bill & Melinda Gates Foundation in 2007, MicroEnsure is the world’s first and largest organisation whose exclusive focus is to address the mass market’s need to mitigate risk. MicroEnsure serves 15 million people in 17 countries around the world with insurance, the majority of whom have never before been insured. In 2014 alone it added 8 million new customers in Africa through an innovative product development and distribution approach.
Give some insights into MicroEnsure Africa’s history and current mandates? We understand that people face persistent risk in their day-to-day lives and generally those who have access to insurance tend to be middle and upper income consumers, who face the least risk of all. It’s true that our customers do not wake up in the morning wanting to purchase insurance, but they do wake up worrying about the risks they face on a daily basis;
and what the impact would be on their families should bad things happen.
We concentrate specifically on developing innovative products aimed at low and middle-income individuals covering a range of risks related to life, health, agriculture, assets, accidents and political violence. What are some of the leading products and services you offer? MicroEnsure operates as the lead partner on microinsurance projects. Whilst we neither sell the product nor bear the incountry risk, we are often responsible for delivering nearly every other element of the project.
Our experience has taught us that microinsurance requires an integrated approach. Our customer care staff must be world class; however, we must proactively manage risk in order to mitigate fraud and other threats to the success of the project. Similarly, we must minimize complex terms, conditions and exclusions, but simultaneously work with our partners to expand our reach in order to ensure
Cheque handing
Service Type Operational execution
Details • Front-end client management platform • Customer care • Claims management • Policy administration Service Type Monitoring and evaluation
Details • Key performance Indicator (KPI) management • Business growth retention • Customer perception • Financial reporting and premium reconciliation • Claims status and payment performance • Risk management
that our simplicity is supported by scale. There are many such equilibria in microinsurance, which require the use of a knowledgeable service provider to ensure alignment between project elements. Service Type Project management
Details • Business case and partnership structure • Project planning and execution • Market research • Value chain facilitation: Insurance and reinsurance arrangement • Regulatory liaison • Legal, commercial and service level agreement content Service type Product and process design
Details • Pricing and actuarial assessment • In-demand product features • Appropriate benefit levels • Minimal terms & conditions • Brand-appropriate marketing content • Robust training content
What’s your target market? Why? We offer a range of products that are easy to use, from hospital cash products that provide cover at any hospital for any medical reason, to property insurance products that protect against any natural or manmade disaster, to life insurance that covers any one at any age, without all the terms and conditions that typically lead people to mistrust insurance companies. Our target market are those mass-market individuals who wouldn’t normally have access to, or be able to afford vital insurance products.
Tell us about your competitive edge? MicroEnsure is the world’s first and largest microinsurance specialist with more than 20 million customers in 15 countries. The company creates insurance solutions for the economically active poor who live on USD4 per day or less, providing a safety net for economic setbacks. MicroEnsure targets low-income populations in Africa, Asia, and the Caribbean with its largest presence in Africa. What are some of the key benefits that clients get from their association with you? It’s all covered in our competitive edge; we offer affordable, trustworthy and real insurance products to the mass market. Often our products have
minimal exclusions, and often we need little in terms of documentation from customers. We are also proactive in our claims management; we will contact and work with the customer to make sure that the claims process is as easy and straightforward as it can be for them. Which mechanisms have you put in place to ensure you remain competitive in the market? Innovative and financially sustainable business models are needed to provide micro insurance to the poor. Mainstream insurance companies have not succeeded in penetrating this market as they face high costs in administering low-value policies and often lack the poor’s trust. We have put in place mechanisms to cover all of this which means that we will constantly be providing innovative solutions at scale. Have you faced challenges? Any possible interventions? Not really apart from those around how we get our products to market and to scale quickly. Based on your experience within this micro insurance space, what are the emerging trends? The estimated USD 40 billion market in micro insurance premiums has been largely untapped. Currently, penetration of microinsurance is roughly 2-3 per cent or around USD 0.8-USD 1.2 billion in premiums. Africa, for example, has one of the lowest insurance penetration rates in the world. In 2014, total premiums in Africa were less than 2 per cent of world market share. Innovative and financially sustainable business models are needed to provide micro insurance to the poor.
What would you say is the role of micro insurance in the future of African economy? The role of microinsurance now and in the future is quite simply to be able to empower individuals who really feel the pain when something unfortunate happens. Microinsurance should act as a safety net that stops them from falling into poverty when bad things happen.
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Healthy Living
Her journey towards the top has been phenomenal. She wants to impact more lives through her startup company that provides health and wellness services to improve individual’s health outcomes
Keeping Your Wellness In Check
M
ary Wanjau fell in love with health and wellness at a tender age of 9. She was diagnosed with rheumatoid arthritis that almost rendered her immobile for life. Three days after undergoing specialized treatment in Nairobi, she began walking. Her joy was insurmountable and hence her passion for health and well-being blossomed that very day. She is now 33 years old and that passion is still unfazed. Ms. Wanjau holds graduate degrees in Nursing, Masters in Project Management and Planning. She is pursuing a PhD in Health at the University of Nairobi, where she is working as a lecturer as part of her PhD studies.
Inspirational journey Her journey towards the top has been inspirational. In 1999, she graduated from high school with top grades and was a pioneer girl of the Equity bank preuniversity mentorship programme. Then a 17 –yearold girl, she was upbeat about career development and professional success.
She further enrolled for a Bachelor of Nursing at the University of Nairobi in October 2001. After completing her studies, she was invited back to Equity bank to set up an employee health promotion unit, a position she quickly embraced. “I joined Equity when it was a building society and gradually grew with it. I started the wellness promotion unit with 200 lives which quickly grew to 11,000 by the time I left the bank. Despite its potential, the employee wellness unit was not an independent department. It was still attached to the human resource department
where I was sitting as an assistant,” Ms. Wanjau recalls.
During that time, the need to embrace employee wellness started to grow across the industry, more so among individuals and corporates. Ms. Wanjau realized there was a gap in helping organizations embrace employee wellness. For that reason, she resolved to extend her services to tap on this emerging market segment.
Setting up WanBeat Wellness Center Limited In this view, Ms. Wanjau formed WanBeat Wellness Center in September 2012. The word was coined from her parent’s names ‘Beatrice’ and ‘Wanjau’ in view of their constant devotion to help her live a healthy lifestyle, a dream she had shared with them at the age of 9. According to her, setting up the firm was a challenging but exciting experience. Although she resigned from her job when she had just been offered a promotion, her commitment was to identify societal health needs and help individuals improve their health outcomes through an independent firm. In addition, she formed the company during an electioneering period-dealing a blow on its operations. It was not until after April 2013 that she secured her first contract with Central Bank of Africa.
How did she succeed in this unchartered path? “I started off alone. However, I had a lot of support from the networks I had established. I got a legal counsel, an ICT expert, an auditor and health providers who gave me invaluable assistance. My family and my close friends were also very supportive. Having been in charge of wellness programme at Equity bank also gave me great insights.” Health and wellness She says that the organization focuses on all areas of health. From social, physical, mental to financial health, the programmes are tailor-made to serve individuals, communities and corporates. The firm lays emphasis on preventive measures as opposed to curative to combat
ill health. “Curative measures should complement preventive services. It is sad to see individuals and corporates spend a lot of money and resources on curative measures which can be largely prevented through early detection and proper management of ailments,” comments Ms. Wanjau. It was a fairly new concept locally. Therefore, the necessity to come up with a holistic approach that assesses the needs of clients and address them was an obligation. She points out, “We have robust mechanisms that assess the impact of our programmes on clients and establish the return on investment in wellness. Corporates have leading factors that help us identify their needs. We assess their organizational structure, budget, medical scheme, attitude and behavior of employees as well as the type of business to develop relevant interventions.” The firm thereafter comes up with measures such as training, counselling and sustainable arrangements and activities that monitor progress in a person’s behavioural-change journey. These programmes are further designed to help employees understand their health risks and adopt healthy behaviours.
Enhancing people’s productivity The founder says that studies have indicated that there is a direct relationship between individual’s wellness and their productivity. Therefore, corporate wellness strategies should focus on productivity of the organization. The firm has tailor made services to address this. “We assess employee’s health risk using indicators such as blood sugar, blood pressure, cholesterols levels and body mass index. We also look at their behaviours and habits such as smoking, diet, exercise, substance abuse and other lifestyle assessments. These are critical in identifying the areas of need, monitoring the implementation and ultimately assessing the impact.”
In its third year of operation, the firm has tightened the grip in this line of business. Health and wellness has gained recognition prompting the firm to expand its reach. Currently, it has an extended clientele who include financial service providers, health service providers, schools, leading
corporates and the government of Kenya among others.
At the moment, the firm is working with the government and other stakeholders to sensitize the public on investment in health. “We are working with the ministry of health to mainstream health promotion in the work place,” she reveals. Despite the health challenges affecting Kenya, Wanjau is upbeat for a bright outlook. “It is unfortunate that individuals and employers get concerned with their health when there is a crisis. This should change. With the right health awareness, risks can be detected earlier and prevent further damages. Individuals, communities and even employers in the work place have the ability to prevent ill health early and if ailment occurs, embrace the necessary treatment and compliance measures for improved health outcomes. To this end, Ms. Wanjau says that health promotion and awareness should be a collective effort. Each and every stakeholder should embrace healthy lifestyles for improved health.
Vital Stats Player: Ms. Mary Wanjau, 33
Business: WanBeat Wellness Center is a health and wellness promotion firm
Established: September 2012
Funding: She used her own savings
‘X’ Factor: Ms. Wanjau love for healthy living has enabled the business to set new standards for
health promotion in the work place
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Book Review
BOOK REVIEW BOOK: NAIROBI HEAT GENRE: CRIME FICTION AUTHOR: MUKOMA WA NGUGI REVIEWER: ORONI TENDERA
Nairobi Heat is a bloody crime fictionthat revolves around three countries-USA, Kenya and Rwanda. A young unidentifiedWhite lady is found dead at the door step of Professor Joseph Hakizimana, in the leafy predominantlywhite suburb of Madison, Winconsin. Professor Hakizimana is a Rwandan national, a hero who saved many lives during the 1994 Rwandan genocide against the Tutsis. He is also a nominee of the Nobel peace prize besides acting as a poster boy for raising funds to help survivors of the genocide. The Professor is automatically deemed the prime suspect of murder. A thorough search in his house gives no clue that connects him to murder. Moreover, his rather composed posture portrays him as innocent. The media remains sensational about the idea of a White girl found dead at the backyard of a Black professor.
A strange call from Kenya reveals that the root cause of the murder can be traced in Africa. Detective Ishmael, An AfricanAmerican, is sent to carry out the assignment in Nairobi where he is received by a Kenyan detective, Mr. Odhiambo alias O. Even though Ishmael consciously identified himself as Black, in the eyes of Kenyans, he was amzungu‘White man’-a label that he perceived with dismay. Detective Ishmael is also confronted by the fact that the gap between the rich and the poor in Kenya is so wide.The rich dwell in the comfort of posh secure mansions as the poorest of the poor live in shacks. In the line of their duty, Ishmael and O brush shoulders with rogue lords and ruthless hustlers. For instance, in Mathare slums. The duo got engaged in a dramatic gun fight with a gang that was attempting to rape a young girl. In another incident, as Ishmael attempts to gain insight of the inner working of charities helping refugees and genocide survivors-whose patron is Hakizimana, attempts to eliminate his life become more apparent. O and Ishmael also confront a well known deadly white tycoon with huge chunks of land a few kilometres from Nairobi. In their pursuit of truth, they often got involved in bar brawls. Ishmael finally unravels the riddle that took him to Africa while in Uganda en-route to Rwanda. Nairobi Heat hits inequalities head-on-collision. From the American white privilege to the wide gap between the rich and the poor that defines African societies. Ngugi’s book is recommended for anyone keen on reading a crime noir from an African perspective
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Travel & Leisure
A Traveller’s Guide To the Kenya National Archives Words Oroni Tendera
C
the ground floor. Move closer to the plaque and read about the late but great Hon. Murumbi. As you read the plaque, you will realize that the space around you is filled with artefacts collected by the person you are reading about.
ream, old and secluded, the Kenya National Archives, like a haunted house, stands desolate between Moi Avenue and Tom Mboya Street. Around it, dozens of humans go about their business without worrying or caring about its existence. So little is known about the Kenya National Archives that its content and occupants have always been a subject of speculation. Only a handful of art enthusiasts, scholars and curious tourists appreciate the fact that the Kenya National Archives is a treasury of history and art. Well, are you ready to explore the Kenya National Archives right now and demystify the myths about it? Here you go. Yours truly shall remain a committed tour guide. You are standing right at the entrance. The trademark cacophony of competing sounds that define downtown Nairobi gets swallowed up by a deafening silence. A few metres from the main door, a plaque bearing the image of the late Hon. Joseph Murumbi -Kenya’s second vice president and committed art lover- together with his biographical information will usheryou to
Joseph Murumbi, former Kenya’s vice president and pioneer art collector
Lift your head and look here and there. Ancient art is at its best. You will be spoilt for choice but don’t be overwhelmed. Move forward. Ahead of you, there is a small compartment, the size of a pitched camping tent. Enter it. Therein, lies Swahili artefacts. The Khanga will be the first item to embrace your eyes. These are rectangular cotton clothes, printed in bold multi-coloured designs, with Swahili proverbs inscribed on them. Khangas, you will realize, have been in existence in Swahili phone Africa since the 1900s and remain popular for their many uses. Next to the Khanga, you will spot ancientSwahili side-blown trumpets carved of wood. Literature below the trumpets will reveal to you that during the 17th and 18th centuries, two of the finest trumpets, each measuring at least two metres long were produced-and are currently in existence at Lamu museum.
Drift your eyes northward and ancient Swahili jewelry will dangle right in front of you: gold and rhino horn necklaces historically worn by married Swahili women and majasi silver ear plugs worn by both the married and unmarried women.
Exit the compartment and turn left. An array of gourd and calabash art are on display. Take a close look. Wakamba gourds –designed with variations of triangles, concrete circles, diamonds, spears and arrows- stand out. According to historians, the gourd paintings have a cultural connotation. For instance, the circles represent Mt. Kilimanjaro, which the Kamba consider their ancestral home while the arrows and spears stand for wealth. Adjacent to the art of gourds and calabashes, sculptures
carved from the lost wax technique-an ancient art in Africa-will definitely scream at your eyes. They include an Ashanti king and queen playing oware (an abstract game of pit and pebbles played worldwide but believed to be of Ashanti origin), a Bobo king from Maliseated on his throne, an African hunter spearing a crocodile among many others. Turn back and take a slow walk towards the stairs as you admire paintings from Mozambique, ancient Nigerian masks, Ethiopian Orthodox Church garments and stone carvings from the Kissi of Sierra- Leone and the Kisii of Kenya. As you get closer to the flight of stairs, decelerate and take your time to scrutinize colourful traditional African fabrics from West and Central Africa spread on the wall. You shall be glad to learn that Kente-Ghanaian textile woven by men on a combination of narrow hand and foot loomsused to be traditionally worn by the Ashanti royalty for ceremonial occasions such as coronations and weddings. Beside the Kente you will spot Bakolanfini/mud cloths from Mali, embellished with designs painted in earth.
Historians have established that Bakolanfini was worn by hunters, serving as camourflage and as a badge for adulthood status for newly-initiated women. Now you are ready to go upstairs. Scale the stairs at a speed of your choice. At the first floor, there is a small room in front of you. That’s a reservoir of official government publications, holding at least 4000 volumes. Enter the room, and see Kenya’s past through the eyes of biographers, journalists and academic writers. You are not done, yet. Walk to the next door. Once
inside, you will unconsciously travel down history highway aboard a collection of pan African stamps, photos of the three Kenyan presidents that you won’t find anywhere else and detailed images portraying traditional African practices such as Kikuyu dental surgery.
Once you feel your eyes have eaten to their fill, give yourself a gentle pat on the back and walk with a slight swagger to the lounge at the third floor. Occupy a seat, place your left leg on top of your right leg, fold your hands in front of your chest and listen to yourself as you formulatean exit plan.
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Song Review SONG; MAKE ME LIKE YOU GENRE: POP ARTISTE: GWEN STEFANI REVIEWER: ORONI TENDERA
On Feb 15th 2016, the Grammy Award ceremony was brought to a standstill as Gwen Stefani premiered the music video of her third solo studio album,Make Me Like You, three days after the audio was released. Make Me Like You, co-written by Stefani, Justin Tranter and JuliaMichaels, is the first music video, in the history of international music,created on live television,during a commercial break of the Grammy awards.
The central thematic concern of the song is Love and Friendship. It is about love in its authentic complexity: betrayal and renewal of passion. The song veers of the one-sided cliché perspective of most love songs that only celebrate the bright side of love, ignoring the dark sphere. ‘I was fine before I met you/I was broken but fine/ I was lost and uncertain but my heart was still mine…You are on me like jewel/I really like you.’ Classified as Contemporary Pop music, Make Me Like You blends aspects of electro-pop music of the 1980’s and modern pop giving it a hybrid outlook. The instrumentation is a composition of digi harps, guitars riffs and drums.
The music video begins at an accident scene where Stefani surfaces, donning a striped white and black dress. She sashays past an array of clocks before grabbing a tabloid whose headline reads, ‘Gwen Pregnant with Allen Baby.’ This is an obvious mockery of fake memes that have been trending recently on social media claiming that her boyfriend, Blake Shelton, has brought her into the family way. The rest of the video scenes involves Stefani changing into colourful costumes amid vibrant dancers.
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