Michael, Bob, Peter...How Safaricom has changed

Anyone stepping into the slot behind the helm at Safaricom would realise that the captain’s shoes are quite large.

They were made and first worn by the steely Michael Joseph, who, in the start-up days, had to walk in downtown Nairobi with his band of employees with a bagful of gadgets and lines tied to his waist to help the first customers get started on the Safaricom network.

Michael laid the foundation of the company with an initial goal to net 20,000 customers.

Coupled with game-changing decisions that include introduction of per-second billing, low denomination airtime, subsidised phones, and the introduction of M-Pesa seven years after, the recipe for next-level success was all set and polished.

“All the products and services we launched from day one, from October 23, 2000, were pre-paid. You didn’t have to fill in a form. You just got into a shop and bought a SIM card. The phones were cheap. Even the billing system we charged per second, not per minute because the people needed to pay for exactly what they used,” Michael said.

In a decade, the Safaricom team had built a runaway success that when the time came for Michael to step down, Daily Nation editorialised that his shoes were too big for his successor Bob Collymore to fill.

Trailblazing success

As it turned out, they were dead wrong. Bob was destined to lead a decade of more trailblazing success, making Safaricom to become Kenya’s first Sh1 trillion company by stock exchange valuation.

"I took an early position that the price wars were not sustainable, and made a firm decision to strike the tricky balance between offering a competitive price to customers that would also enable us to earn a margin to continue to invest significantly in the network," Bob would later say.

His leadership model was defined by Three Ps: Purpose, People, and Profits.  “There is a new way of doing business,” Bob said. “The way businesses have conducted themselves for decades or centuries is now outdated. Plan A is not working anymore, because all we are seeing is climate degradation, human rights abuses, and corruption. We have to find a new way of doing business, and it starts by businesses saying that the primary purpose is not to generate profits."

Bob would oversee a period of rapid growth for Safaricom and turn it into East Africa’s most profitable business. Under him, M-Pesa grew from a payment platform to the backbone of Kenya’s economy. M-Pesa’s contribution to Safaricom’s bottom-lines grew to more than a third.

He would lead the company to become Kenya’s first Decacorn as the share price rose past the Sh30 point. As he grew the company, the avid reader and jazz enthusiast also oversaw investments in the arts by Safaricom in the form of the Safaricom International Jazz Festival and the Safaricom Youth Orchestra, effectively creating some of the biggest calendar events in the entertainment scene.

The man who loved playing the saxophone would also personally take charge and implement changes to payments made to musicians, whose music was on Skiza, the service that offers ring-back tunes. With Skiza, said David “Nameless” Mathenge, artistes could now get access to more than 17 million people when their songs are released.

Just over six months into his job as CEO, Peter Ndegwa has presided over the celebrations marking 20 years since the company was established. The natural question of how he feels in the large boots arose.

“I feel the sense of responsibility but also I need to be myself. I need to lead as Peter Ndegwa,” he said.

Even as he paid tribute to his predecessors, the CEO made it clear that his vision is to oversee Safaricom's transformation into a technology company going beyond its well-known offerings of connectivity and M-Pesa.

Unique brand

“There is a real sense of responsibility to build on the foundation the company has had. This is a unique brand, a ubiquitous organisation, and a household name. I need to enable us to take it to the next decade or two,” he added.

In effect, the CEO said, Safaricom will be looking to maintain its focus on purpose and become a technology company, building on the foundation set by Michael and the late Bob.

At home , Safaricom has set up M-Pesa for business, dubbed Pochi la Biashara, whose target is micro, small, and medium enterprises (MSMEs), which employ a majority of the workforce. Pochi la Biashara is intended to enable business owners to separate their personal and business mobile wallets and prevent the reversal of transfers by unscrupulous customers.  There will also be more investments in health, education, and agriculture.

In agriculture, this will focus on innovations such as DigiFarm, the platform launched in 2017.Once they are registered on DigiFarm, farmers can access information on affordable inputs, e-extension services, and access to markets and insurance.

“DigiFarm was set up with the vision that we have today. What is different today is that now, agriculture and health will be central to our future,” said Ndegwa.

Safaricom’s 20th birthday celebrations were an appropriate time to spell out that vision and what the picture of success would look like.  "We are 20 years old. We want to be here 100 years from now," Peter said.

This article is part of the Safaricom@20 celebrations.