Sticky thoughts on Safaricom’s Direction with Bob Collymore


Two week old context

On the Saturday of December 4th 2010, I fought my way out of bed to make it on time for Mindspeak with Robert (Bob) William Collymore. Bob has been Safaricom’s Chief Executive Officer from October 2010 and many Kenyans were curious to hear ‘anything’ from him at the increasingly popular event.  Mindspeak is an event organized monthly on Saturday mornings by Mr. Aly Khan Satchu  (Chief Executive Officer of Rich.co.ke). The venue for the event is  usually at the Nu Metro cinema, Westgate Mall in Nairobi’s Westlands area. The MindSpeak happened only two months after another insightful event I wrote about on ‘Reflections with Michael Joseph of Safaricom’ at the iHub Nairobi. A number of bloggers including James Murua , Tovuti Sanifu and UjenziBora have chronicled their observations at the MindSpeak event with Bob Collymore. A lot of the attendants were also tweeting the event live and their live feed was captured by afrinnovator using CoveritLive.com’s nifty tool. Mr. Aly Khan Satchu has also released a set of videos on the event in his Rich TV series. On this event, although over two weeks have passed and much has been documented, I still have a number of sticky thoughts to share. In this post I wish to hopefully enrich our view of Safaricom from my observations at the MindSpeak.

Excellent Marketing Opportunity

I have previously observed that the stiff competition among our four Mobile Network Operators (MNOs) will be won through presentation of genuine value propositions to the citizenry. Product attributes aside, it is the sheer appearance at MindSpeak by Bob that struck me as Safaricom’s marketing savvy that Yu, Orange,  and Airtel Kenya are yet to cath up with. Marketers have this argument that as competition increases it becomes increasingly difficult to distinguish a product using traditional attributes such as price, quality and functionality. Perception management then becomes the other strategy to snatch extra points from the competition.

MindSpeak has this niche audience that has significant influence over Kenya’s increasingly important generation of young professionals and students. In the few MindSpeak events I have attended, I could not help but watch the speakers gleefully attempt to persuade the audience about their most intimately held sentiments. The persuasion efforts were all in acknowledgement of the potential influence of the audience particularly through blogs, twitter and social media in general.

Connection with the peculiar Kenyan citizenry

Throughout Bob Collymore’s presentation, it was evident that Safaricom intended to be perceived as a friend of the citizenry. In the presentation, Safaricom was quite ably endearing itself to the audience. Bob was stating Safaricom’s deliberate intentions to drive social and economic change in Kenya. The presentation related very well with Kenya’s dearest development issues including health, education and agriculture. It depicted Safaricom as a development partner and enabler, particularly (and quite strategically so) for rural Kenya.

For our fairly competitive telecom industry, Safaricom’s ability to connect with the citizenry through such a forum, articulating its most carefully packaged industry position was  enviable.  It is the essence of this deep connection with Kenya’s peculiar environment that Airtel and other competitors of Safaricom do not seem to understand - despite their often superior product offerings.

Arguably, Safaricom’s competitors are too busy packaging counter-offerings, forgetting the need to genuinely connect with their fairly unique operating context. Airtel for instance are still airing global or at most Africanized (one size fits all) advertisements in Kenya. Safaricom on the other hand is spending millions on custom Kenyanized  advertisements such as this acclaimed piece.  This is why Bob could confidently say that ‘the trust that the public has for safaricom is in itself a great asset’. Whether it is trust or the perceived connection with the citizenry, Safaricom indeed has accumulated for itself a wealth of such invisible assets.

Interests of Major Shareholder(s)

Throughout the presentation and the question/answer sessions, Bob Collymore would suddenly change to a very serious (almost cautious) tone whenever he talked about Safaricom’s shareholders. I found this tweet by Aly Khan Satchu useful :-
‘@alykhansatchu: 753,000 Shareholders keep me up at Night www.rich.co.ke #Safaricom #Kenya #Mindspeak we have M-Pesa and Data 11:20am’

A member of the audience asked a question as one of the many small shareholders (many kenyans are) which I do not remember. At that point I thought to myself that perhaps Bob’s Pensive tone whenever talking about his shareholders was more about Safaricom’s Major shareholder(s) - Vodafone (40%) and GoK (35%).  As a Kenyan and a very small shareholder, I have continued to be frustrated by Safaricom’s disinterest in regional expansion - to Uganda, Tanzania, Rwanda and the rest of Africa. Bob confirmed my fears when he replied to a related question, saying that that Safaricom was simply not looking at a geographical diversification (regional expansion) strategy.

I have touched on Safaricom’s options for future growth in previous posts. Bob’s answer on the ‘would-be natural’ strategy of regional expansion reminded me of observations in those past articles. By virtue of Vodafone’s 40% ownership of Safaricom’s and them (Vodafone) having other subsidiaries in Uganda and Tanzania, a constraint is placed at the board level on any Safaricom ambition to enter the markets outside Kenya. Such is Vodafone’s influence over Safaricom’s future that any thoughts of venturing into other regional markets must consider Vodafone’s existing interests on the (foreign) ground.

The above constraint in my analysis has seriously limited Safaricom’s options for growth and remains its Achille’s heel. I have also argued previously that it is vodafone’s interests that cost Safaricom its ‘rightful’ stake in the ownership of the M-PESA patent. Consider that in one of the Bob’s answers during the MindSpeak, he reiterated the position that Michael Joseph - his predecessor had been retained by Vodafone among other things to be its ‘M-PESA ambassador’. Both Michael and Bob are Vodafone appointees. It should not take much rationalisation therefore to understand that Safaricom’s leadership will always steer the company away from competition with other Vodafone’s interests in Africa and elsewhere.

The feeling that Safaricom is not being genuine about releasing an API for kenyan developers to integrate business services with M-PESA is increasingly widespread. Safaricom is not convincing either,  that the delay in releasing this widely clamoured for feature is not about Vodafone/foreign interests. I did not find Bob’s answer to a related question adequate - that the delay was due to security concerns. Its been over two years since Kenyan developers started clamouring for the API and there are no signs yet of it coming soon.

Perception of Competition

Bob’s perception of Safaricom’s competition can be summarised in at least two tweets below:-
‘@alykhansatchu: #Mindspeak Airtel can afford to destroy The #Kenya Market We cannot @bobcollymore www.rich.co.ke #Africa 11:21am’
‘@gmeltdown: #mindspeak safaricom has to pay for armed patrol on their fiber cable to fend off vandalism - says Bob 10:33’

Bob and others in Safaricom wished for the audience to believe that Airtel’s super low prices for voice and SMS were meant to destroy Kenya’s mobile network industry. See my article in October 2010 on Airtel’s move. Although I do not wish to go into the discussion in the first tweet, my take is that Airtel Kenya is only trying to cut down Safaricom’s market dominance of about 80% market share to lower manageable levels. Cutting down Safaricom’s market share will not destroy the industry in my view.

The second tweet is about Vandalism of the inland terrestrial optic fiber cables layed out by the competing data connectivity providers in the recent months. The vandalism depicts difficulties and costs inherent in Kenya’s business environment. Although Bob saw a pattern to imply competitor sponsored vandalism,  it appears that Kenya government is not doing enough to provide security of investor’s assets. Obviously the security issue contributes greatly to Kenya’s attractiveness as an investment destination. A lot has been written about the cable vandalism and there is hope that the government will eventually bring the menace under control.

Customer Focus

To many Kenyans,  Customer service is Safaricom’s biggest problem. Considering its huge customer base, it is on the same matter of customer care that Safaricom can argue to be the strongest among its competitors. I have previously argued that Customer Focus is one of the significant battle fronts among Kenya’s MNOs whose winner will collect for themselves many points in the dominance war.

I was particularly impressed by Bob Collymore’s articulation of his intentions to direct Safaricom’s corporate culture towards customer focus. His thoughts that Safaricom could not make the mistake of outsourcing its customer service (call centres) were quite profound. In a demonstration of seriousness about customer focus, Bob went ahead to express his desire for attributes like honesty, relevance, simplicity, ease of use and listening to customers in its products and customer interactions.

With the noble intentions on customer focus well articulated by Bob, then I could only come up with the tweets below :-

‘@gmeltdown: #mindspeak Bob wants safaricom to embrace customer obsession as a way of life. 10:53am’
‘@gmeltdown: #mindspeak an array of customer focus intentions presented by bob. hoping safaricom will wall the talk. 10:56am’.

As a user of most of Safaricom’s products, I must say that their quality of customer service can vary greatly with their categorization of customers (post paid and prepaid) and with the various products (M-PESA, voice, and data connectivity). It is this variability in quality of customer service that would need to disappear for many to believe the good intentions articulated by Bob.

In Conclusion

To conclude this long post it is worth noting that as the competition among Kenya’s MNOs shift gears, a complex multiplicity of parameters will have to be watched by each player.