CEOs of Kenya – step forward!

May 08, 2005 Leadership, Sunday Nation

Chief Executive Officers of Kenya: please pay attention. Your country needs your services. We are going to hell in a mkokoteni cart, and all men and women of vision, authority and management expertise need to step in to avert disaster.

Assume, for a moment, that Kenya Ltd is your company, and you have just taken over as the CEO from a series of predecessors who ran the company for the four decades of its existence. Here are a few highlights of this company’s record. High-level productivity (GDP per capita, or output per unit of input) has been the same (US$ 350 per year) for 40 years. This is the level at which your “competitor companies” (other countries) were, on average, in the year 1750. The corporation has not managed to generate revenue growth in excess of inflation for several years now – and doesn’t really know how to do it in years to come. The cost of inputs (wages, power, raw materials) keeps rising every year; matching increments in productivity are hard to find.

As you try to analyse this issue, you notice that the modern, automated part of your company has been diminishing in importance every year, while the cheap (and shoddy) products produced in ramshackle “Jua Kali” sheds at the back of your factory are growing all the time. You see that your workers are poorly paid, engaged in other businesses and prone to sudden violence, and live in fear of their lives every day. You observe that most of them lack basic health facilities. You detect that hundreds of them have to share a single computer and telephone line. You discern that only a tiny proportion has made it to university, and even that group doesn’t have the skills relevant to its work.

You also begin to notice deeper problems. The corporate culture is all wrong: an emphasis on deal-making, contacts and overnight success, rather than skills and hard work. The incentives structure is similarly warped. Managers routinely fail to deliver results, yet their rewards head only skyward. Workers huddle in ethnic groupings that breed mistrust. Massive frauds are taking place in your finance department all the time, yet no one has ever been brought to book. As a result, your company is heavily in debt. It borrows from one institution to pay another. It pleads with financiers every year, promising good behaviour and great growth prospects, and invariably failing to deliver. Your managers are mostly thieves and incompetents; yet your shareholders appear to be asleep and generally vote the management team back in after an “AGM” held every five years.

Now, Mr or Ms CEO: can you tolerate this situation for even a moment, and still retain a shred of professional self respect? Yet that is exactly what has been tolerated here for 40 years or more. If you would not stand for this in your own corporations, business leaders of Kenya, why do you stand (in some cases, jump) for it in the country around you?

As things stand, this country has no vision of what it wants to be; no goals and objectives that anyone believes in, and no values with which to bind together its workforce. It is in progressive and seemingly inexorable decline. At what stage will you do something about it? At what point will you work out that your own corporation’s future is inexorably linked to the fortunes of the country at large? As we go over the cliff, or five minutes before?

Enough polemicising from me. You get the message, I’m sure. How much longer can we leave it all to politicians, when all evidence confirms that they are leading us to ruin? And who else can do something about it, other than those who control resources, maintain huge pools of management expertise, and generally have the most to lose? In short, the Chief Executives of Kenya?

For too long, business folk have stayed aloof from politics, above the unseemly fray. Not our “core competence”, after all. We must stick to the knitting and manage our own businesses. Does that still hold when the whole edifice around you is displaying alarming cracks? We get misled by the fact that our balance sheets look good and shareholder wealth is growing. But increase your angle of vision. If domestic consumer purchasing and spending continues to decline, if your ability to keep skilled professionals in this country continues to weaken, if the cost of doing business maintains its upward march – what results will you be reporting in the years to come?

That’s not to say that business leaders have not noticed all of this in the past. We have set up many a lobby group, many a professional association. We have prepared many lists of demands. We have held meetings and seminars with the powers that be. We have participated in think-tanks and national committees. We have contributed thoughtful ideas and suggestions. But we are all results-focused professionals; otherwise we would not have survived in the private sector. As such, can we honestly point towards a set of results worth the trouble from all this activity?

The situation in this country is beyond talk shops and committees. If we are to change the rules of engagement, let us first accept one fact: no one else is going to step in to turn the country around; not now, not in 2007 and not beyond. If there is a “Mandela” waiting to save us, that being is not a person; it is a collective force. It is the focused energy of visionary management professionals willing to make their contribution to national salvation a core competence.

If you still doubt the need, study the “management deficit” in government. Is this how you would do things? Chase hardworking business people (“hawkers”) out of the Nairobi CBD, knowing that you’ve done nothing to organise a new home for them? Then relent and allow them back “on Sundays only”. Then reverse even that decision to allow “further consultations”? Would you make a few dramatic and well-publicised demolitions on road reserves, then get tired of the idea and do nothing for two years? Would you factor in the unpredictable largesse of outside donors into all your annual plans and budgets? Would you allow management pay and perks to increase every year, long before any results are in? Would you let the boss-worker pay gap get to the point where it leads to shameful deprivation and violent protest?

I’m talking to you, CEOs, because you can make a difference. You have the decision-making power, the long vision and the ability to catalyse and lead change. You wouldn’t be the business leaders you are if you didn’t have those things. You are strategists who know that if you’re persistently losing the game, it’s time to change the rules. This goes beyond polite lobbying, beyond corporate charity and beyond whingeing.

That was the war cry, the call to arms. As good generals you will know we also need a point-by-point list of initiatives, a plan of action. To be debated on this page next week at the same time. I hope to have your company.