HOW SAFARICOM MANAGES TO OUTTHINK EVERYBODY ELSE

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Safaricom, Kenya’s leading corporate organization is on the lips of everybody. Competitors, partners, and the government itself cannot but reckon with this behemoth. In less than twenty years, this company has completely defined and redefined the country’s corporate landscape. You can’t help marveling at the almost effortless way in which Safaricom operates while its competitors are left breathless from the chase- and finishing nowhere close.

From its tiny beginnings and going on to a highly publicized IPO, Safaricom has captured the imagination of all and sundry. Small children discuss the Safaricom phenomenon with their parents at mealtimes. From its initial byline of “The Better Option”, the company’s increased muscle and self belief has morphed into “Safaricom Twaweza”- which, loosely translated comes to “We Do It! “. Talk of guts and chutzpah. You don’t get this confident unless you have quantities of self-belief. While competitors are trying one strategy after another, and arranging musical chairs, Safaricom is busy raking in oodles of money. Just early this month (beginning of May 2018), the behemoth announced another record-breaking year of mind-boggling results, having raked in profits to the tune of Kenya Shillings 55 billion. This is a lot of money. Pundits have fallen over themselves explaining to us ordinary mortals what this figure means in terms we can understand. Putting figures in context is what they call their efforts on our behalf.

It is true to say that Safaricom is the major nightmare of companies in the same field of play. What this giant is thinking is the preoccupation of managers from the two or three players in the game. Definitely contributing to its success is the sheer amount of brainpower that is housed within the Safaricom organization I would guess that less than 1% of corporate entities in the country, nay, in the region have accumulated as much brains as this giant. No one can really contest the assertion that results achieved by the greatest organizations are strictly attributable (caused nor simply correlated) to the quality of its workforce. David Thielen, a longtime Microsoft insider has noted that the single most important contributor to Microsoft’s productivity has been the quality of its employees, “everything else is secondary to this criterion”. To this can be added the contribution of a unique management system put in place by Bill Gates. The simple kernel of success- putting a premium on brainpower- should be obvious to competitors but this somehow seems to elude them.

Safaricom has demonstrated its willingness to invest in the distinctive asset contained in the heads of its people-brains. Unless and until competitors rise up to this reality I am sure that we will continue to have only one game in town for a long time to come. And also only one tune, “Twaweza”. Safaricom’s people, no doubt spend their nights dreaming of unexplored consumer needs which they put on their list of customer selling propositions, a continuous process of gathering ideas as the basis for innovation.

The company’s deep pockets has enabled it extend its tentacles to Kenya’s (and the East African region’s) remotest towns and market centres. To the consumer, this is a signal that the company is here to stay and is worth investing in. Its dealer network grows by the day and represents the company’s deep understanding of its marketing and distributive channels as a lever of competitive advantage. Indeed, distributive channels are as real a customer as the individual subscriber clutching at his mobile telephone gadget. Peter Drucker has pointed out that perceptive organizations vividly understand just who their customer is. If this is not done, you will find yourself targeting marginal customers at the expense of the real core customers.

In mobile telephony, the market in which Safaricom plays, the key (or core) customer is the dealer network. It is not primarily (at least in money value terms) the individual subscriber, important as she may be. It is for this reason that Safaricom has insisted that even with the loosening of the mobile money transferability across networks, competitors must develop own dealer networks.

You have seen attempts by the government’s agencies designed to stunt Safaricom’s growth arguing that its sheer power is not good for the market. In euphemistic terms this is variously called “market dominance” and “monopolistic tendencies”. To customers (and Safaricom itself), they are being punished for simply outthinking and outplaying their opponents. Whose mistake is it that the rest of the players cannot match its game? In football analogy, should Manchester City (the current English Premier League champions) be shackled so as not to put a great distance between themselves and the rest of the field, say Swansea? (By the way, if I am not wrong, Swansea has since been relegated from the Premier League to Championship League where they rightly belong. They can always come back when they have grown up enough).

Should brains and strategy be forced to bow to the slowest of the players in the game? What government should realize is that customers will continue to vote in the box marked “self-interest”. They will only pay for value and nothing else. Events in the recent past when the company was the target of a political boycott showed indisputably that customers put their own interests first-they continued to do business with Safaricom because it made sense to them. No fiat would do. The government’s attempts to shackle down Safaricom can only hurt consumers. An attempt to restrain and restrict ability is nothing less or more than pure envy.

As an astute observer, I cannot fail to see that Safaricom will soon achieve total control of its market space and knock out all its competitors. You can see Safaricom’s strategy in terms of a grand chess game whose culmination will be a checkmate of existing players. With time, competitors will become increasingly marginal and cease to matter altogether. While competing managers spend their time puzzling over what Safaricom is thinking, on its part, it is thinking about new customer offerings and propositions-consider offerings such as Songa, Blaze, among others. These are in addition to a bevy of incremental tweaks intended to improve customer experiences. Its retail stores are full of life exuding an image of success with throngs of eager customers daily crowding to sample new offerings and buy its latest gizmos. In the case of Safaricom, the virtuous cycle comes closest home. It has never been truer that “Success breeds success”.

Simply, Safaricom outthinks its competitors. Barring a game-changer, the tune in town for a long time will be “Twaweza!”

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