Updates from IBD Kenya – World-Class Healthcare & Beauty for Kenya…Even from the US

Akilah Huguley is a full-time MBA student working on an International Business Development project with Kenya-based Africa Chemist and Beauty Care (ACBC). 

Many of us come to business school with illustrious travel plans on the mind.  At Haas, IBD provides the opportunity for an unchartered global business travel consulting project. I remember the evening of our first IBD class and how excited I was to find out that I, along with 3 of my classmates, would be traveling to Nairobi, Kenya to help a new pharmacy chain enter into the Kenyan market. This project for my team was certainly a dream come true—an assignment that utilized our healthcare & retail backgrounds plus an opportunity to travel to a place none of us had ever been before. Over the course of the semester, we built a strong relationship with our client even from thousands of miles away. All seemed to be in a great place for us to hit the ground running on field work as soon as we stepped off the plane in Nairobi. With bags packed and flight tickets in hand on Friday, May 16th (the day before leaving for our IBD trip), none of us could have predicted the turn that our trip would take.

I remember waking up quite early on Friday morning (in anticipation of our upcoming travels) to an email from our faculty advisor. The email contained the subject line, “Travel Risk for Kenya.” Kristi Raube, the Director of the IBD Program and our project advisor, was writing to inform us that the US Embassy had posted a security message informing travelers to closely evaluate their personal travel situations based on “heightened threats of terrorism and the high rate of violent crime” in Kenya.

That day in Kenya, at 2:30pm local time, two bombs had detonated in the Gikomba market, a marketplace right outside of Nairobi, killing 10 people and leaving many injured. Only hours later, the UK Embassy evacuated all of its citizens out of the Kenyan coastal city of Mombasa amid threats of terrorists attacks in the area. Receiving emails of support and concern from our client and our advisor, we were now faced with the dilemma of what to do next.

acbcbbcfinalBBC Footage of Aftermath of Explosions

One of our team members had made her way to Kenya early to spend additional time traveling the country before the kickoff of our project. We knew it was pertinent to speak with her before making our final decision of whether to go to Kenya or not.

daniellePicture of team member (Danielle Platt) in the Massai Mara (a national game reserve in Kenya known for its vast population of wildlife and the annual migration of zebras, gazelles, and wildebeests from the Serengeti)

After much deliberation and meeting with the entire team, we decided to delay our flight a few days, giving us time to digest the information at hand. It was extremely important for us to complete and present a quality final deliverable to the client… and the question was, would we be able to do this all the way from the US? Could we turn a tough situation into a successful outcome for our client?

Over the course of the project, we had uncovered a number of insights around the low-quality of pharmacies in Kenya—including the overwhelming presence of counterfeit products as well as the grey market, the channel by which branded products illegally and unsustainably make their way into Kenya. However, we really wanted to experience and understand the state of the market better for ourselves, speaking with customers directly and building connections to best understand how ACBC could be the answer to the problems that Kenyan consumers face.

Analyzing our project plan, we found that it could be feasible to complete our project from the US with our team member in Kenya playing a crucial role as the on-the-ground eyes and ears for the team. With modern technologies like Google Hangout & Skype, understanding a customer that was thousands of miles away didn’t seem impossible. With a few more days to feel confident in our decision, the three of us that were in the US decided that we would stay locally and complete the project remotely. Our teammate that was already in Kenya decided to spend another week in-country and then return back to the US to join the team.

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compshop3Competitive Shopping Photos from Nairobi

Over the next week after making our decision to stay in the US to complete the project, we met every morning via Skype (accommodating a 10-hour time difference) to discuss what we had completed in the prior day, conversations with the client, new insights we were developing from interviews and secondary research, and next steps in order to hold to our project plan. In the US, we were even able to meet with the founder of the company (the other half of the client team) who lives in San Francisco to discuss our project progress.

sfibd2Meeting with Our Client in San Francisco

Upon our team member’s return, we held a full brainstorm day (using our learnings from Haas’ Problem Finding Problem Solving class) to aggregate customer insights we had gained from our interviews in order to pin-point the customer segments that our client should target. acbcbrainstorm2

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Brainstorm Day in San Francisco

The outcome of our brainstorm and our semester of learning about the personal care, beauty, and pharmacy industries in Kenya was a comprehensive report of four key customer segments that our client might target. Within these segments, we found that many customers were not satisfied with the care and attention they received from pharmacies. They often leave a pharmacy still needing more information about products that better cater to their healthcare needs. In a market where most patients self-medicate and do not frequently visit doctors, customers need a place that they can go and obtain trustworthy guidance and consultation. We were able to provide actionable steps that the client could take to help the Kenyan customer gain confidence in this new pharmacy model in Kenya.

Upon completing the project, we were able to provide many insightful answers for the client. But in the process of completing the project, we also learned a crucial lesson within our team. This experience taught us that although international travel is great, going to an exciting new country is not the most important part of business school or the IBD experience. It is about helping people. With our project, we hope to help Kenyans gain access to the things that we take for granted here. We have heard people’s stories and frustrations and now look to turn these into solutions. Our ability to go beyond the status quo in the face of a tough international travel situation and our motivation to go beyond ourselves in finding ways to connect with a consumer halfway across the world allowed us to be influential in an evolutionary change that can impact millions of people. And the more inspiring part, we were able to do this even from thousands of miles away.

Spurring Innovation in Nairobi’s ‘Silicon Savannah’

 Team Juhudi Kilimo is in Nairobi, Kenya working with Juhudi Kilimo to develop a strategy for structuring, financing and operating a new innovation lab, dubbed “Juhudi Labs”, which will support the continual development of Juhudi Kilimo services to rural smallholder farmers.

Before our trip, we knew that Nairobi is one of the most prominent and fast growing cities in East Africa. Yet, I don’t know if we were fully prepared for the culture of innovation that Nairobi breeds. Also, we didn’t quite realize the impact that we would have as we developed the business model for Juhudi Labs, an innovation lab that would partner with outside entrepreneurs and streamline internal resources to develop micro finance solutions.

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Week one started off at our client’s headquarters: a brand spanking new second floor location in the posh Kilimani area – boasting reliable Internet, a generator, and security guards.  From our balcony, we interviewed local entrepreneurs and Juhudi’s team to delve more into the structure that Juhudi Labs would undertake.

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 That first week we also ventured to iHub, a co-working space and business incubator for local entrepreneurs, designers, and developers. iHub is heavily funded by big players such as Microsoft, Samsung, and Google; and is the heart of Nairobi’s Silicon Savannah.  And although locals deride the term “Silicon Savannah” since there is no real manufacturing capability here, the bigger picture is that Nairobi is abuzz with innovation and entrepreneurship, and our project with Juhudi Labs is positioned to be right at the center of it. GrowthHub, our next stop on the Nairobi tech movement discovery and as equally impressive, offers mentorship, access to capital, and training.

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 Week two took us into rural Kenya, our client’s satellite stronghold. Juhudi offers micro financing to rural farmers, and Ned our strategy professor would say, that is their internal fit. And what a fit it is – we spent about 48 hours over 5 days in a rented matatu, a Kenyan minibus, on Dramamine-required dirt “roads”, visiting farmers throughout El Doret, Bungoma and Masaii Mara (okay that last town was for a safari trip but I digress). We came face to face with the Kenyan spirit of kazi ngumu (hard work), from the farmers who worked tirelessly tending their dairy cows, the cooling plant operators who collected and distributed the milk to brokers, and Joseph our matatu driver who never seemed tired while we uncomfortably slept through most of the ride.

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A lot of us came to business school and chose Berkeley specifically for its proximity to Silicon Valley and the Bay Areas’s ecosystem of entrepreneurship. What we IBD’ers at Juhudi were privileged to experience was not just Mother Africa and the best she has to offer (oh yeah safaris and beach houses!!) but the ability to spur innovation and this ecosystem through Juhudi Labs in the ever-growing Silicon Savannah.

 We are very grateful to IBD and Juhudi Kilimo for the opportunity to meet, work with and learn from such an amazing group of people!

Asante Sana!

Thank you! Merci! Gracias!

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Juhudi Kilimo and IBD Kenya – Turning the Corner

After reflecting on a wonderful three weeks in Kenya, we’ve decided to blog about what’s been the highlight of our trip – the opportunity to make a major impact at a fantastic young organization preparing to enter the next stage of its development. Juhudi Kilimo is microfinance organization that makes loans to farmers specifically for agricultural products such as cows, chickens and dairy equipment. Recently, Juhudi transitioned from a non-profit to a for-profit social enterprise and the organization is looking to rapidly expand its loan staff and reach 100,000 Kenyan farmers by 2015. A major aspect of this growth will be the project IBD was tasked with taking on, the creation of a loan officer performance scheme. In other words, our IBD team has created a bonus system for Juhudi’s loan officers that incentivizes improvements in loan disbursements and loan quality.

We spent our first week in Nairobi at the head office, meeting with staff, including the eight branch office leads, and finalizing the details of the pilot incentive scheme. Without going into too much detail about the scheme, the general concept is that employees are awarded for hitting monthly disbursements targets and for achieving a low Portfolio at Risk. Although much of the work on the scheme was completed before arriving in Kenya, we made a few major decisions about the project during that first week. First, we decided that the incentive scheme would be group-based, at least for the first year. As mentioned above, Juhudi is growing rapidly and we wanted to ensure that the organization maintains its focus on teamwork during this period. Additionally, we felt that a group-based system would be easier to manage and provide a smoother transition period for the organization. Second, we decided to launch the pilot for the scheme in all eight branch offices as opposed to the original plan of only four offices. In making this decision, we felt that the risks of alienating those offices not participating in pilot outweighed the potential benefits of having a control group. Finally, we decided that Juhudi’s existing system of setting disbursement targets should be revamped for the purposes of the incentive scheme. Instead of having each individual loan officer base their targets on projections worked out with their supervisor, we decided to set a standard organizational target, which represented the upper quartile of historical loan officer performance.

For the last two weeks in Kenya, we’ve been traveling around the country, visiting all the branch offices to train Juhudi’s employees on the pilot incentive scheme. Two weeks ago, we all visited the Marang’a branch office, which is two hours east of the capital. Then Adam and Luis traveled six hours west of the capital to visit the Kisii and Nyamira offices. Allan and Jerry also traveled six hours west to visit the Kericho and Litein offices. This week, Allan and Adam traveled eight hours north to visit the Eldoret and Kitale offices. Finally, Jerry and Luis traveled four hours east to visit the Nkubu office. Presenting to the field staff was a wonderful experience. In addition to getting to see most of the country, we got to spend time with over 40 members of Juhudi’s talented and dynamic staff. Additionally, we all got to spend time with a number of Juhudi’s clients, at their farms and in their homes. For example, this week Adam and Allan shadowed a loan officer at the Kitale Branch and got to travel the countryside on boda bodas (motorcycle taxis) visiting local farmers.

Luis, Jerry and Allan with Milly, Marang’a MFO

Ultimately, while the creation of our project was a rewarding experience, the most satisfying aspect is that Juhudi Kilimo will actually be adopting our work. Starting today (June 1st, 2012), the organization will begin a month long simulation of the incentive scheme, where they will track bonuses and report them to staff. Next month, Juhudi will launch the actual pilot and begin tracking, and paying out, bonuses. The pilot program will last one year and the head office will survey the staff on their perceptions at the midpoint and endpoint of the program. We’ve also equipped the head office with calculators and formulas that will allow them to quantitatively monitor the efficacy of the incentive scheme. At the end of the year, the head office will decide whether to continue with the incentive scheme and with what changes. And hopefully they will be supported in this venture by another Haas IBD team!

Finally, while our work with the Juhudi was the highlight of the trip, we definitely had some exciting times outside of the office. Immediately after landing in Kenya, we had the opportunity to support the country’s law enforcement in the form of a bribe paid on our way from the airport. On the brighter side, we had an amazing time on safari at the Maasai Mara, where we saw cheetahs, elephants, giraffes, zebras and mating lions. We also fell in love with the local cuisine and consumed more than our fair share of Nyoma Choma and Ugali. On the stranger side, we visited a nature conservancy in Kitale that hosted genetically mutated animals, including a bull named Laser that had four horns and three working eyes. Tomorrow, we’ll leave Kenya and finish our adventure with a visit to Zanzibar, Tanzania!

Adam and Allan with Lazer

Allan, Adam, Jerry and Luis at the Maasai Mara