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Disrupt or die
Bob Collymore, chief executive of Safaricom, Kenya’s largest telecom, was refreshingly honest this week while being interviewed at an event in New York. Speaking about M-Pesa, the mobile money service, which his company launched in 2007, he remarked that the product is a little “clumsy” and ”far from elegant”.
Raw honesty is often not a luxury many top CEOs can afford as they try to tread the fine line between keeping both customers and investors happy. But both sets of stakeholders should be pleased in this case because Collymore is addressing that most basic of challenges for any technology-led company: the Innovator’s dilemma.
M-Pesa might be clumsy, but it has 20 million customers, it’s the biggest mobile money service in the world, some 43% of Kenya’s GDP, east Africa largest economy, passed through the service last year. There’s an entire M-Pesa ecosystem for other partner innovators being built on the platform. So it’s all great, right? No, it’s not great in the long term.
Just as Clayton Christensen explains in his book The Innovator’s Dilemma, what Collymore is acknowledging is that if M-Pesa becomes complacent because of its market dominance it will be caught flatfooted by innovative rivals from unexpected sources. The ‘dilemma’ companies like Safaricom face is whether to do the disrupting or wait and fight the nimbler and quicker disruptors when they come calling. While Collymore isn’t quite calling for self-disruption yet, he’s signaling M-Pesa can’t rest on its laurels.
So his answer is to upgrade the technology and build more open systems that work with a variety of partners in an “open world”. That will improve both the customer experience and potentially improve M-Pesa future value for investors.
Collymore says he wants M-Pesa to work worldwide and be “just like WhatsApp” in its seamless ubiquity. Yet the challenge might not necessarily just be about better or disruptive technology. Safaricom may also need to disrupt its corporate structure by spinning off M-Pesa so it isn’t held back by the parent company’s local or regional rivalries and conflicts. That way it can really become an innovative, globally competitive and “elegant” African business.
Yinka Adegoke, Quartz Africa editor
Stories from this week
Netflix rolls out more servers. Spotty internet connections and pricey data plans are a problem for many viewers in Africa who want to stream movies on Netflix. But the company’s deployment of a dedicated server in Nigeria could help towards fixing the problem of buffering videos, writes Yomi Kazeem.
Declassifying France’s files on Sankara’s assassination. A judge in Burkina Faso has asked France to declassify military files on the killing of Thomas Sankara, the country’s former leader. The move is part of a probe into the largely unanswered questions about how the leader died.
The mystery of Africa’s disappearing presidents. Malawi’s president Peter Mutharika just returned home a month after he left to attend the UN General Assembly while Cameroon’s president Paul Biya has been in Europe since the summer. As Lynsey Chutel notes, neither president is the first African president in recent times to disappear without a word to his bemused citizenry.
Africans are mocking the US presidential elections. In a US electoral season where standards have dropped incredibly low, Africans have been afforded a chance to mock America’s seemingly exemplar democracy. Using the hashtag #Nov8AfricanEdition, Twitter users around the continent have been writing tongue-in-cheek examples of the aftermath of the election if the US was an African country.
Ethiopia’s Facebook ban. Under the state of emergency rule in Ethiopia, posting updates on social media outlets like Facebook is now a crime, writes Lily Kuo. But even more significant, the government has shut down mobile internet—a move that could drain millions of dollars from the economy, finds Abdi Latif Dahir.
Emirates giving up on Nigeria. With the depletion of foreign reserves due to lower oil prices, Nigeria’s tight currency controls have made it difficult for foreign airlines to repatriate their own dollar profits. In May, United Airlines cancelled its flights to the country, and now Emirates, one of the world’s richest airlines, is thinking about following suit.
Chart of the Week
Modern slavery is still rampant in resource-rich countries in Africa. For many across the world, slavery is a far off, historical concept. But in over 80% of countries in sub-Saharan Africa, and especially in resource-rich countries like Congo and South Sudan, servitude, forced labor and hereditary bondage still exist.
Other things we liked
The opioid crisis for the rest of the world. Tramadol, an inexpensive, imported painkiller, is so heavily abused in northern Cameroon its spreading abuse and addiction. But, as Justin Scheck writes in the Wall Street Journal, the drug still remains unregulated on the recommendation of the WHO.
Rwanda’s last monarch is dead at 80. Kigeli V Ndahindurwa, who ruled Rwanda for nine months before fleeing into exile in 1960, died last Sunday (Oct. 16) in the United States. In the wake of his death, revisit Ariel Sabar’s 2013 profile of the king in the Washingtonian magazine, which described how he was surviving on foods stamps, and living in a low-income neighborhood in Washington DC.
Monopoly tournaments in Nigeria. Nigerians have a fondness for board games, be it scrabble, chess or ayo, a game similar to mancala. But in recent years, monopoly has made a resurgence. As Chris Stein and Dionne Searcey write in the New York Times, the game is appealing because it mimics the chaos of the real estate market, which is plagued by bribery and scams.
Keep an eye on
South Africa to release budget deficit (Oct. 26): South Africa’s finance minister Pravin Gordhan is expected to present medium-term budget policy statement to parliament, alongside the Treasury’s latest budget deficit and economic growth projections for the next three years.
Lagos Fashion and Design Week (Oct. 26-29): The premier showcase of Lagos fashion will feature the usual runway shows but also include a day dedicated to discussing the future of the fashion business. There will also be an African Development Bank’s event called ‘Fashionomics’.
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