How has Covid-19 affected the Stanbic Business Incubator and How Does it Plan to Respond? Chief Executive Tony Otoa Explains
ConsumerCentriX works closely with Stanbic Bank Uganda on both the COVID-19 Business Info Hub and the Stanbic Business Incubator. This article originally appeared on the COVID-19 Business Info Hub.
How has Covid-19 affected the Stanbic Business Incubator and How Does it Plan to Respond? Chief Executive Tony Otoa Explains
Like all businesses, the Stanbic Business Incubator (SBIL) faced a slate of new challenges and obstacles stemming from the pandemic. To understand how the Stanbic Business Incubator navigated these challenges, we sat down with Tony Otoa, SBIL’s Chief Executive. Mr. Otoa provided us with an insider’s perspective on SBIL’s pandemic experience, lessons learned, and projections for Covid-19 recovery.
Mr. Otoa explained that the pandemic afforded SBIL one major lesson: a business must remain agile and adapt to the flow of the new normal. Covid-19 upended traditional business operations, relationships, and practices. Businesses that were unable to adjust and respond to the evolving environment suffered immensely while those that were flexible and adapted practices and operations as things changed flourished. For its part, the Stanbic Business Incubator changed its program development process and how it connects with its clients.
Because of the lockdown, explained Mr. Otoa, SBIL was unable to carry out in-person training, so the team switched to online platforms to complete its mandate of supporting Uganda’s business community. Like in businesses throughout the world, transitioning online heavily impacted how SBIL delivers its services and required a shift in its approach to client relations and communications. The upshot to these challenges was an increase in the number and geographic location of people reached. Pre-pandemic, class sizes were limited to what was allowed by regional training hubs, but the online platforms allowed SBIL to reach many people through the country.
Mr. Otoa believes that SBIL’s Covid-19 recovery started long before the lockdowns were lifted. Stanbic Business Incubator remains focused on supporting businesses to drive and achieve more. Their strategy is to assist businesses in accessing finance, accessing markets, and provide tracking to better understand how to support them better. More importantly, is how this support is delivered. Mr. Otoa stresses the need to blend approaches to best support businesses in the coming period. This means combining online and in-person training to best support their clients while blending business techniques from both the pre- and post-Covid period.
SBIL expects its new chapter to encapsulate the lessons learned from this pandemic period. Namely, the need for agility as they switched to new, online platforms, the new geographic regions and audiences they were able to reach as a result of their online shift and continuing the newly blended approach to continue supporting their clients. All told, Stanbic Business Incubator expects a strong recovery for themselves and for their clients as they step forward into this new period.
Interested in training opportunities with the Stanbic Business Incubator? Incubator Business Manager Sheila Agaba explains upcoming offerings
ConsumerCentriX works closely with Stanbic Bank Uganda on both the COVID-19 Business Info Hub and the Stanbic Business Incubator. This article originally appeared on the COVID-19 Business Info Hub.
Interested in training opportunities with the Stanbic Business Incubator? Incubator Business Manager Sheila Agaba explains upcoming offerings
- Sheila Agaba
Business Manager, Stanbic Business Incubator
The Covid-19 Business Info Hub recently sat down with Sheila Agaba, the Stanbic Business Incubator’s Business Manager to discuss the many training opportunities on offer to small and medium enterprises and aspiring entrepreneurs.
Ms. Agaba leads Stanbic Business Incubator Limited (SBIL)’s strategy, coordinates partnerships, and tracks SBIL’s impact. During her tenure, she has witnessed some of the pandemic’s major impacts on SBIL’s clients. She notes that small- and medium-sized enterprises (SMEs) struggled throughout the pandemic to access much-needed finance. Viewed as riskier investments by financial institutions, SMEs struggle to secure capital to develop their businesses. To address this challenge, SBIL has implemented various capacity-building trainings to help de-risk SMEs and improve their chances for access to credit.
The Enterprise Development Programs – which have been rebranded as the Stanbic Accelerator Program, Micro enterprise Development Program and Supplier Development Program. These will have both in-person and online sessions and include both a local and regional focus. These sessions specifically target SMEs at a more intermediate stage of their business journey, such as those that can provide annual turnover reports and other business information. The local program largely supports businesses with the know-how to access capital and markets in the Kampala region. They were shifted fully online when Covid-19 struck for safety reasons. The Micro Enterprise Development Program provides similar support but operates at a national level and targets micro enterprises with 1-2 staff and an average annual turnover of 5M shillings.
SBIL’s Supplier Development Program is largely geared toward those in the oil and gas industry. This program supports SMEs aiming to qualify as suppliers to larger companies engaged in drilling and other work across the Albertine region. The program supports SMEs to get registered to the national supplier database if not yet registered. This program will support linkages for the beneficiaries to the existing players in the oil camps in order for them to supply companies in drilling and oil and gas construction. This will be conducted with support from local oil companies in the industry. In addition, personal finance modules help SMEs with the necessary principals to arrange both personal and business financing. Similarly, SBIL arranges masterclasses post the trainings for alumni which are information-sharing sessions for about several topics relevant to business growth.
SBIL’s program Implementation relies on financial support from Stanbic Bank, local and international partners This funding helps SBIL to deliver on the key pillars of access to capital and market for SMEs. These programs facilitate SMEs develop new product lines, obtain new contracts, and expand into new markets and geographical regions. One of SBIL’s major partners is the German Agency for International Cooperation (GIZ), which focuses on job creation specifically for women and youth. Their target is to create employment for nine hundred people annually through the GIZ partnership. The French Embassy in Uganda is another donor that focuses on supporting SMEs especially youth and women in agroecology and ecotourism. Similarly, the African Development Bank (AfDB) has partnered with SBIL through Petroleum Authority Uganda (PAU) to facilitate and train Business Development Services (BDS) to over 200 SMEs in various sectors along the EACOP route districts – a Ugandan area where the oil and gas pipeline will pass before entering Tanzania. All told, these partnerships have yielded a significant increase in SMEs’ access to funding. 27% of unbanked SMEs engaged in the programs have opened accounts with Stanbic Bank while 15% have begun access credit from Stanbic Bank. 35% have improved their tax compliance – allowing access to more markets and proving an early victory for SBIL’s international partners.
With pandemic lockdowns coming to an end, Stanbic Business Incubator is now looking to the future and how it can keep serving the business community. Ms. Agaba notes that the company is looking forward to expanding partnership opportunities while prioritizing sustainability.
Business Training During the Pandemic: Experiences, Lessons and Recommendations from the Stanbic Business Incubator Limited
ConsumerCentriX works closely with Stanbic Bank Uganda on both the COVID-19 Business Info Hub and the Stanbic Business Incubator. This article originally appeared on the COVID-19 Business Info Hub.
As the pandemic enters its third year, governments and the private sector reflect on the lessons learned from COVID-19. The last two years have yielded extensive data on how external shocks and crisis response can affect the business community.
Stanbic Business Incubator Limited (SBIL) has played a key role in supporting small- and medium-sized enterprises (SMEs) in Uganda, guiding many businesses through the pandemic’s perpetual twists and turns while helping them to make sense of the information overflow. To benefit from these lessons, the COVID-19 Business Info Hub will highlight SBIL’s experience throughout the pandemic in an effort to benefit the Ugandan business community.
Founded in 2018 and operating under Stanbic Uganda Holdings Limited, the Stanbic Business Incubator Limited runs capacity building and entrepreneurship development programs for SMEs. In 2021 alone, SBIL managed to train over 700 business owners from various sectors and more than 4500 entrepreneurs across Uganda. Drawing from SBIL’s experience in training SMEs through the pandemic, this series will focus on the experience of the Incubator’s experts and training staff through interviews and first-hand discussions. Our readers can expect insight into different topics, including:
- A high-level overview of SBIL’s impact, responses, and opportunities for SMEs as they navigate the pandemic
- An exploration of SBIL’s partnerships and upcoming programs helps to outline what it prioritizes for members of the business development workshop.
- Reflecting on 2021’s selection of training programs, Incubator staff discuss the experience of the program’s exiting alumni so businesses can learn from their peers
- First-hand interviews with alumni and non-members help to better understand SMEs biggest needs while sharing frontline experience as they navigate the pandemic
Over the next five articles, we’ll help SMEs understand the unfolding business environment with experience from SBIL’s practitioners, managers and businessowners. Readers are likely to find business insights that will help in developing new strategies and tactics to maintain their business competitiveness while responding to the fast-changing conditions of an evolving pandemic.
Interested businessowners may be interested in SBIL’s upcoming schedule of master classes, training events, cohorts and partnership events. Similarly, readers may be interested in the Compassionate Leadership Webinar Series, which provides training through a slate of webinars. Updates on all these programs and more will be available on the COVID-19 Business Info Hub.
Ultimately, the coming series of articles provides opportunity for businesses to benefit from peer-learning and the guidance of an industry stalwart. We look forward to you joining us.
Gender Equality and Women’s Economic Empowerment Mapping Tool: Spotlighting Opportunities for Impact in Sub-Saharan Africa
Sub-Saharan Africa is the only region in the world where women make up the majority of entrepreneurs. But, delve a little deeper and you will find that women face steep social and economic barriers to growing their businesses. While access to finance is the key constraint, they are also much more likely to be hindered due to household responsibilities and are less likely to have the market skills to advance their businesses. Removing these barriers could unleash a huge opportunity for women entrepreneurs and boost economic growth in the region.
The European Investment Bank (or EIB) launched the African Women Rising Initiative (AWRI) to support women’s economic empowerment in Sub-Saharan Africa by identifying effective environments for growth, increasing access to finance, and supporting women entrepreneurs in selected countries. The AWRI aims to strengthen women-led or -owned businesses through designing holistic, market-oriented programs, bolstering business skills, and developing gender intelligent financial services.
As a first step for the AWRI, ConsumerCentriX (CCX), as part of the Consortium with German-based technical advisory group IPC and African Management Institute (AMI), set out to identify the strongest opportunities for impacting women entrepreneurs in Africa. CCX conducted a comprehensive mapping exercise that assessed the current state of financial inclusion for women, women’s entrepreneurship and empowerment initiatives, as well as innovations in financial technology, and digital banking. Based on this exercise, the team identified countries in the region that have substantial gaps in gender equality and women’s economic empowerment, however, their macro and social environments could enable a financial sector intervention that fosters progress.
Mapping Methodology
Women entrepreneurs are not evenly distributed across Sub-Saharan Africa. The region is made up of 48 countries at varying stages of development and some places offer a more conducive environment for women entrepreneurs to grow their businesses with the support of formal financial services. In order to better understand women’s financial and economic inclusion opportunities, we created a scoring system based on 65 publicly available indicators from sources such as the Global Findex[1]. Not all countries in Sub-Saharan Africa were surveyed by the Findex which limited the comparable data, but in many cases, other indicators were able to be substituted from other sources like the World Bank, International Monetary Fund, the Organization for Economic Co-operation and Development, Economist Intelligence Unit, as well as Citibank and Mastercard data that illustrate macroeconomic, demographic, political-regulatory, and socioeconomic dynamics within each country. Additional sector-specific datasets contributed a broader understanding of the stage of development and inclusiveness of the financial sector. We then ranked each country according to their stage of development as indicated by the gross national income (GNI) per capita and compared them based on the indicators.
The indicators were categorized into four overarching themes that tested each country’s receptivity to potential financial inclusion efforts based on their legal or socio-cultural constraints and women’s access to finance. The categories included:
- Enabling Environment: Provided a snapshot of each country’s development stage by assessing the general economic and demographic environment through indicators like conflict, debt, GNI per capita and GDP, and population characteristics;
- Women’s Inclusion and Human Capital: Assessed women’s socio-economic position including factors that influence their productivity and opportunity to build capital;
- Women’s Entrepreneurship: Analyzed the ease of doing business in each country and women’s typical role within the small and medium-sized enterprise (SME) sector; and
- Financial Sector: Focused on the availability of financial services through different channels, the regulatory environment, and the sector’s inclusivity and capacity to serve entrepreneurs with financing.
Ultimately, the CCX team created an effective tool that swiftly facilitates benchmarking of countries in Africa (and beyond) for our work on impact consulting in women’s financial inclusion and entrepreneurship support. Additionally, the tool includes permanent links to the respective databases utilized for the mapping exercise.
Results
During the mapping exercise, 19 countries were immediately omitted from the selection process based on insurmountable obstacles to a long-term technical assistance engagement like extensive violent conflict and significant debt distress. Countries with extremely small populations were also not carried onto the shortlist due to their lack of scalability and potential impact.
In order to narrow the playing field even further, we categorized countries in Sub-Saharan Africa into five groups based on their development stage. Each country was ranked according to threshold criteria against peer countries within each group. Countries were excluded from consideration if the socio-economic challenges or gender gaps they were facing could not be realistically addressed with financial inclusion or women’s economic empowerment initiatives. To advance to the next round, countries needed to score 60-70% on average across all indicators when compared to the top country within each group.
Countries that met the threshold had significant room for improvement in women’s entrepreneurship and inclusivity in the formal financial sector that could be addressed by the areas intended for the AWRI technical assistance, namely empowering women entrepreneurs and creating gender-intelligent and innovative SME financing solutions. In other words: these countries indicated a substantial potential for growth compared to their best-in-class African peers, while also presenting a sufficiently conducive environment for impact through the AWRI support.
Based on this scoring system, a shortlist of 16 countries qualified including Benin, Burkina Faso, Democratic Republic of Congo, Cameroon, Côte d’Ivoire, Ghana, Kenya, Lesotho, Liberia, Madagascar, Mozambique, Nigeria, Rwanda, Senegal, and Uganda.
EIB selected Côte d’Ivoire, Rwanda, Senegal, and Uganda were selected as the four finalists. These countries have healthy percentages of SMEs t
hat are women-led or -owned, have financial institutions with existing relationships with EIB that are interested in better serving women entrepreneurs, show strong potential for growth with existing conducive regulatory and social environments and/or the opportunity to leverage digital channels to deepen financial inclusion and women’s economic empowerment.
Below is brief overview of the four finalist countries:
- Côte d’Ivoire is the business hub of French-speaking West Africa with strong prevalence of private business and self-employment with an established financial sector, fast-growing microfinance activity and strong digital uptake;
- Rwanda has high women’s labor force participation (84%) and a supportive public sector, a national financial inclusion strategy and investment climate which offers strong opportunities for digitization;
- Senegal is a majority Muslim country that has a relatively high degree of gender equality in early-stage entrepreneurship, with a high share of female entrepreneurship and strong remittances which could serve as a source of funding for women business owners; and
- Uganda is an attractive market for business investment given its stable economy, large market, and the size of its labor force with a financial inclusion strategy that is generally supportive of women’s economic activities.
The mapping exercise was successful in identifying countries in the region that are more favorable to women’s economic inclusion and empowerment and serves as a useful tool for understanding country contexts in the financial sector in other regions throughout the world.
Women in Sub-Saharan Africa face universal constraints as entrepreneurs and EIB’s AWRI program will now support organizations that can increase women’s financial inclusion by developing quality programs involving access to finance, training and other non-financial services to support woman entrepreneurs’ growth.
[1] The Global Findex is a publicly available data set on how adults save, borrow, make payments and manage risk that is published every three years by the World Bank. Data is collected in partnership with over 140 economies through nationally representative surveys.
Compassionate Leadership for Entrepreneurs Series: Leading with the Heart
ConsumerCentriX, in partnership with Stanbic Bank Uganda Limited (or Stanbic Bank), kicked off the first webinar in its Compassionate Leadership for Entrepreneurs Series on November 4th, 2021, under the theme “Leading with Heart: Adapting to a New Normal in a Tough Business Environment.” The webinar explored how the bank and other key businesses in the market adapted to the current business climate given the ongoing effects of the COVID-19 pandemic and the impact of using compassionate leadership as a business strategy.
The webinar was moderated by Maurice Mugisha, a Ugandan journalist and Managing Director of Uganda Broadcasting Corporation, and the panel included Emma Mugisha, Executive Director and Head of Business Banking at Stanbic Bank, Dr. Peter Kimbowa, Chairman of the Board of Directors at the National Social Security Fund (NSSF), Thadeus Musoke Nagenda, Ag. Chairman of Kampala City Traders Association (KACITA), and Isaac Nsereko, Managing Director of RI Distributors Ltd.
The COVID-19 pandemic in Uganda has led to waves of lockdowns and business closures, making it impossible for businesses to continue day-to-day operations as usual. The disruptions have heavily affected decision-making, employee management, and the bottom line for businesses. All of the panellists agreed that leading with compassion during these extraordinary times has been essential. For them, this has meant listening to their employees and the concerns of their customer base, challenging the assumptions behind their convictions, and being ready to adapt to a constantly changing environment.
A few key themes emerged from the discussion:
Work together. As business leaders, it’s important to share best practices and ask others to join in utilizing compassionate leadership. If more business leaders share their knowledge on how to listen to employees and customers, challenge assumptions, and adapt quickly in a changing environment then institutions will improve, and the economy will be strengthened. In the case of KACITA, the largest trader block in Kampala, Mr. Nagenda explained that most of the shopping malls its businesses operate out of were closed during the lockdowns. KACITA approached the government and advocated for the reopening of arcades so that its business owners could continue doing business and making a living. Due to the shutdowns, the company also asked for a moratorium on rent for the business owners. Mr. Nagenda that “most of the [arcade] landlords are also traders and part of KACITA” and they began working together to find solutions.
Adapting to change is imperative. Leaders should approach challenges as opportunities to shift their ways of working. The pandemic forced many sectors to embrace change through digitization, whether that included investing in ways for their staff to work from home or making loans available to more customers through mobile banking. In the case of Stanbic Bank, Mrs. Mugisha mentioned adjusting working hours to better fit customer and employee needs and implementing changes so staff could work from home comfortably. As the pandemic dragged on, more customers began to default on their loan payments and the bank “put in place repayment extensions to relieve the customers who were affected by the pandemic,” said Mrs. Mugisha. Focusing on the mission of the business instead of the structure allows businesses to adapt to a new normal.
Trust is essential. The most valuable component of an institution is its people. A leader must build and maintain trust with employees in order to make compassionate leadership sustainable. When suppliers cut off credit lines, RI Distributors, one of the largest logistics trading companies in Uganda, focused on preserving the business through adapting their supply chain lines and establishing trust with their truck drivers by launching a number of key safety measures. First, they divested in long-term projects and focused on ramping up COVID-19 testing stations for their truck drivers. The business also hired more drivers so to ensure adherence to safer social distancing policies through a more flexible driver rotation schedule. Mr. Nsereko said; “I think it’s compassionate leadership that knows the business will [have the opportunity to focus on making] money in the future and chooses to look after their people now, in a sustainable way, in order to stay in business.”
Continue to Innovate. As institutions and leaders’ transition, make adjustments and recover from the shocks of the COVID-19 pandemic, it’s important to remain curious and willing to adapt. Continued disruption can make it really difficult to make a concrete plan for the future, but it can lead a company to develop better practices. NSSF, the largest social security fund in Uganda, launched a leadership ‘Think Box’ in order to continue to innovate and tackle the biggest challenges, particularly how to avoid layoffs and keep employees fulfilled while working from home. Dr. Kimbowa is proud of the results of these efforts – NSFF largely retained its staff, and reminds others that “firing people during hard times is in itself an admission of failed imagination [for leadership].” Continue to assess your beliefs and processes and make sure not to revert back to ineffective ways of working.
Compassionate leadership is essential in building resilient companies that survive in the face of adversity. The health and wellbeing of employees and clients should continue to be a priority for leaders in order to build a stronger and brighter future. Join us for the next instalment of the series that is planned for the first quarter of 2022.
ConsumerCentriX launches Compassionate Leadership for Entrepreneurs to support wellbeing of small business owners
ConsumerCentriX is launching Compassionate Leadership for Entrepreneurs to support small business owners as they navigate uncertain times. The COVID-19 pandemic has had a disorienting effect on global health, economic activity, and our daily lives both professionally and personally. Business owners and entrepreneurs have been among those most affected by COVID-19 as lockdowns and border closures made it nearly impossible for them to continue their day-to-day operations. As small business owners work to recover from the effects of the pandemic, personal wellbeing should be a priority, as it affects decision-making, employee management, and ultimately a business’ bottom line.
Compassionate Leadership for Entrepreneurs will feature a series of informative blogs, webinars, and a local radio show that explore tools and tips for business owners to positively impact their wellbeing. The initiative draws on the concept of compassionate leadership, which is defined as interacting as a leader in ways that exhibit compassion for oneself and in relationship to others as well as acting intentionally to create positive impact in the world as a whole.[1] The first of three webinars in the Compassionate Leadership Public Engagement Series launches on November 4th, 2021 in partnership with Stanbic Bank Uganda Limited. In Rwanda, the Building Back Healthier Series launched with a local radio show held October 25. Two additional webinars are scheduled to take place this fall, the next in mid-November.
In tough business environments, leading with compassion takes courage and is rewarded with resilience. Compassionate Leadership for Entrepreneurs will take a deep dive into the positive impact of compassionate leadership and the importance of focusing on personal wellbeing. Stay tuned as we share strategies and tools to help entrepreneurs foster better work environments, build better business outcomes, and lead with compassion.
[1] Center for Compassionate Leadership. July 9, 2019. “What is Compassionate Leadership?”
Strategies that can help save your business and plan for the unexpected
A version of this article was originally posted on the Covid-19 Business Info Hub
Due to the pandemic, many businesses have experienced new and significant operational challenges such as inadequate cash flow, decreased demand, and supply chain disruptions resulting from lockdown restrictions. According to the Economic Policy Research Center (EPRC), 50% of businesses in Uganda had to close operations at least temporarily for an average of over three months. These challenges were unprecedented and have made it clear how disruptive a crisis can be. Most companies were unprepared and as a result, some have closed operations permanently. Others have struggled to get back on their feet.
Here is where a business continuity plan can be a critical tool enabling businesses not only to survive but potentially to thrive even during a crisis. A business continuity plan is a document that outlines how a business will continue operating during an unplanned disruption. It guides businesses on how to reassign resources and communicate effectively internally and externally, all key components to maintain operations even during challenging times.
Because developing a business continuity plan may be a new concept for small business owners, in September, the COVID-19 Business Information Hub focused on guiding entrepreneurs in their development. We had insightful discussions with stakeholders and businesses who implemented a variety of business continuity strategies during the pandemic, and here is what we learnt:
Conducting a risk assessment: The first thing that every business owner should do is assess the risk and vulnerability of their business. This can be easily done using a tool that the International Labor Organization (ILO) provides free of charge. The ILO also outlines a six-step process to develop the business continuity plan with a key focus on four main elements (People, Process, Profits, and Partnerships). We spoke with John Kakungulu Walugembe of Federation of Small and Medium-Sized Enterprises-Uganda (FSME), who explained in detail what the 4Ps stand for and how businesses can use the six-step plan to their advantage. (click here to access the special interview with John Walugumbe).
Determining critical activities: Business owners need to define critical activities needed to continue to operate during a crisis. Businesses should immediately identify actions to take based on the risk exposure. Lilian Katiso of Mau and More, a company that sells potted plants, recognized that watering plants was critical to mitigate the risk of losing her inventory due to withering. The business decided to purchase a motorcycle to facilitate one staff to do the watering during the lockdown.
Establishing an internal communication plan: A communication plan outlines how teams and employees may best communicate with each other to support the company’s objectives. It helps increase communication frequency and promotes the dissemination of information about what is happening within the company and the employees. Toddler’s Gold implemented a communications plan including regular meetings to discuss business targets and understand staff welfare. As a result, their sales grew during the lockdown.
Embracing technology and digital platforms: Technology helps to support business operations during challenging times. When regular work arrangements were disrupted, and we saw a shift to remote work, Rajab Mukasa, Director at Pique Nique Ltd, adopted mobile money and the use of agents to complete his banking activities. It allowed the company to order by phone and pay suppliers remotely instead of using cash.
The disruptions caused by COVID-19 have set a new preparedness benchmark and demonstrated that small businesses need to continuously adapt and evolve their strategies to better prepare for future risks. Joseph Walusimbi a national coach and trainer with the International Trade Center (ITC), an agency of the United Nations, encourages entrepreneurs to embrace business continuity plans to prepare for uncertainty. He also highlighted the potential need for external financing to implement specific activities. Businesses should seek financing options focusing on recovery, innovation, adaptation and sustainability, such as the Economic Enterprise Restart Fund available at Stanbic Bank Uganda or credit guarantee schemes that shift risk from the private to the public sector.
ConsumerCentriX best-in-class training to support financial institutions serving the SME segment goes virtual
ConsumerCentriX best-in-class training to support financial institutions serving the SME segment goes virtual
ConsumerCentriX has a long history of working to support financial institutions serving small- and medium-enterprises (SMEs).
SMEs face a tremendous financing gap, and many do not have access to the kinds of business development services that make them stronger potential borrowers with the skills to grow their businesses as usual or to manage disruptions like COVID-19. SMEs face unique challenges and have specific needs.
On the other hand, financial institutions have a hard time grappling with understanding the full financial picture of many businesses in this segment, and as a result, find it challenging to lend to SME entrepreneurs, whose recordkeeping varies and who may bank with multiple banks (or none at all).
The financial institutions that serve SMEs – both those who want to serve them for the first time and those who want to serve them better – need to consider implementing an approach that enables them to better understand their SME customers: a relationship management approach. This approach entails establishing and maintaining long-term relationship with customers centered around providing solutions that meet customer needs rather than just promoting one product or service. In turn, this ensures a greater share of wallet for the bank.
Effective relationship management in SME banking requires strong Relationship Managers with skills in connecting with customers and understanding how to analyze businesses in this unique segment as well as in monitoring post-disbursement to address potential issues before they arise or to identify additional needs customers may have. Earlier this year, ConsumerCentriX developed and launched a four-part virtual training program to support Relationship Managers in honing their skills to better serve the SME segment. The best-in-class curriculum centers around four key areas essential to serving SMEs:
Relationship Management
Provides trainees with foundational skills needed to build a relationship with customers and real-life examples to complement learnings
Gender Awareness
Identifies and addresses potential biases trainees may have in approaching or assessing women entrepreneurs
Business and Credit Analysis
Focuses on techniques to collect, cross-check, and analyze business information to conduct an efficient credit analysis using quantitative and qualitative information
Decision Formalization and Portfolio Management
Hones trainees’ technical skills in preparing credit proposals, including identifying potential risks and mitigation strategies that are monitored from loan origination throughout the repayment period.
ConsumerCentriX transformed these topics, normally covered in 8 days of in-person classroom training, into 4 online modules with 26 mini-sessions of between 20 and 45 minutes. The mini-sessions include animations, exercises, and videos that aim to bring life to self-paced virtual learning.
We recently piloted the training with Stanbic Bank Uganda Limited (SBU), one of the largest commercial banks in Uganda with a strong footprint among SMEs that aims to expand its reach and deepen its engagement in the sector.
What have we learned?
While the pilot is still underway, ConsumerCentriX is already seeing results and has been able to leverage preliminary learnings to make small tweaks to enhance the effectiveness of the virtual training.
Importantly, trainees are successfully learning the theoretical knowledge presented in the self-paced virtual sessions. While online learning has become frequent due to COVID-19, the sessions developed for this training are short and as interactive as possible to avoid some of the fatigue that has become common with participating in online events.
Pearl Akol, an Enterprise Direct Business Banker at SBU, shared that as a result of completing the relationship management component of the online training, she has “understood that you have to listen to the customer carefully and match a solution to the customer’s need” rather than to focus on selling a particular product. It transforms the way she approaches conversations with new and existing customers and is sure to have an impact on the bank’s bottom line. For Alex Insingoma, an Enterprise Direct Business Banker, the gender awareness module was eye-opening. “After going through this training, I was able to recognize the importance of women in business given their big numbers and their unique way of running businesses,” he said.
While theoretical knowledge can be effectively transmitted through self-paced virtual sessions, live online discussions and practice sessions best ensure information is internalized by trainees. Typically, ConsumerCentriX follows up our in-person SME training programs with hands-on coaching and mentoring done with trainees at their branches and in the field. This kind of approach can be difficult to replicate online, but other techniques can be used instead. We incorporated live virtual coaching sessions moderated by our expert SME team to smaller groups of 5-7 people for 1.5 hours at a time. They focus on addressing main challenges faced by participants on any of the content, provide a dedicated time for trainees to practice specific tools or skills acquired, and offer participants the opportunity to discuss real case studies from actual entrepreneurs.
Lastly, proper planning and oversight by the financial institution are critical to success. ConsumerCentriX usually conducts multiple planning meetings in advance of in-person training to outline the objectives, ensure staff availability, and to identify how outcomes will be tracked in close collaboration with the partner financial institution. These steps cannot be skipped for virtual learning.
- First, an institution needs to identify its goals – particularly the behavior changes and outcomes that it aims to see as a result of the training.
- Then, time needs to be set aside for staff to complete the training – this can be a number of hours per day or week within a certain period of time. This needs to be communicated to staff, and follow-ups should be conducted by managers to ensure staff are completing modules within designated deadlines.
- Finally, the institution needs to identify the key performance indicators it will track to understand outcomes – if a financial institution wants to see additional business generated as a result of the training, key performance indicators around new leads or a greater share of wallet should be clearly communicated at the start of training, monitored during training, and tracked over time once training is completed.
ConsumerCentriX looks forward to completing the pilot training with SBU over the next few months and partnering with other financial institutions across Sub-Saharan Africa and beyond to continue to serve SMEs despite challenging times. If you are interested in learning more or partnering with us, contact info@consumercentrix.ch.
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Developing a Business Continuity Plan for Your Enterprise
ConsumerCentriX works closely with Stanbic Bank Uganda on both the COVID-19 Business Info Hub and the Stanbic Business Incubator. This article originally appeared on the COVID-19 Business Info Hub.
The COVID-19 Business Info Hub spoke with John Kakungulu Walugembe of the Federation of Small and Medium-Sized Enterprises-Uganda (FSME) to understand the importance of developing a business continuity plan for enterprises and how this helps to build resilience during challenging times. A business continuity plan can be defined as a document that outlines how a business will continue operating during an unplanned disruption in service. It contains contingencies for business processes, assets, human resources, and business partners – every aspect of the business that might be affected.
John K. Walugembe is the Executive Director of FSME, the umbrella/business association that brings together over 112,000 micro, small and medium-sized enterprises across 20 sectors in the country. Here’s what John had to say about the importance of business continuity plans in light of circumstances brought about by disruptions like the pandemic:
“Many businesses don’t have business continuity plans and do not know why they need to develop them.”
The impact of the pandemic on the MSME sector is unprecedented. Many businesses are closed, others have limited demand, and many are struggling to pay their staff. Businesses face challenges they have never encountered before and disruptions at overwhelming levels. So, “when we are talking about business recovery and resilience, we are trying to ensure that businesses get back to their pre-pandemic level” of operations. Business continuity plans can help businesses in doing just that. However, many entrepreneurs do not know what they are or how to go about putting them together.
FSME worked with International Labor Organization (ILO) to assist 200 MSMEs to come up with a business continuity plan according to a six-step process developed by the ILO.
FSME used the ILO’s six-step process for putting together a business continuity plan, which starts with an assessment of risk.
To assess the level of risk and vulnerability faced by a company, business owners need to focus on the 4Ps below and can assess their level of risk using the link included above.
People
How are your workers and their families affected by COVID-19?
Processes
How are the everyday operations of your business affected?
Profits
To what extent is your income and revenue affected?
Partnerships
How is the environment around your business affected by COVID?
Next, businesses must follow six steps as outlined below.
Step 1: Identify your key products or services.
Step 2: Establish the objective of your plan.
Step 3: Evaluate the potential impact of disruptions on your enterprise and workers.
Step 4: List actions to protect/minimize risks to your business
Step 5: Establish contact lists for non-physical activities (WhatsApp calls, Zoom meetings etc.).
Step 6: Maintain, review, and continuously update your plan.
“SMEs should also network and reach out for help.”
Although business continuity plans help answer questions about how your business can continue operations in moments of crisis, companies need to be agile and adapt plans to changing circumstances. One way to do this is by reaching out for support from organizations like FSME and to other business development service providers. Businesses can also reach out to their networks for ideas and support.
FSME is keen to support SMEs when and where possible, so please reach out to the organization via Tel at 0774147864 or via email at info@fsmeuganda.org or at john.walugembe@fsmeuganda.org
Stanbic Business Incubator Chief Executive Gives an Overview of the Opportunities for SMEs in the Oil and Gas Value Chain in Uganda
Stanbic Business Incubator Chief Executive gives an overview of the opportunities for SMEs in the Oil and Gas Value Chain in Uganda
Ernest Wasake: Good morning, Comrade Tony Otoa; I hope this finds you well. How have you been holding up during this period of the pandemic?
Tony Otoa: Thank you very much for hosting me. I have been great.
I have had a great time of learning, growing and understanding how to do things differently—and now we are getting used to doing different things to make things happen.
Ernest Wasake: Could you give us an overview of the Oil and Gas Value Chain in Uganda?
Tony Otoa: The Oil and Gas Value Chain is a very vast and intense one. It is a great value chain with many opportunities, especially in the local context.
The chain has upstream, midstream and downstream project segments. The upstream project is about the drilling, construction and civil works. In the midstream project, you have the oil pipeline of 1400-kilometre from Hoima in Uganda to the Tanga Port in Tanzania. The downstream, which is already evident in the country, is available for many local entities to deliver the final oil products to the consumers. There is less local participation in the upstream and the midstream projects because they are technical and capital intensive.
The Oil and Gas Value Chain in Uganda is an exciting opportunity for many local people. Opportunities include a wide range of jobs created plus the provision of services and goods in the downstream operations. With close to 15,000 workers to be employed directly, there will be a big need for food, accommodation, and health services, among others. When we talk about food, agriculture becomes a critical focus area, presenting many opportunities to benefit from.
Ernest Wasake: Great, please tell us about the Stanbic Business Incubator Limited’s role in the Oil and Gas Value Chain?
Tony Otoa: The Incubator’s role is very interesting and has been evident for quite some time.
We do not see ourselves as a stand-alone financial entity but as an entity supporting Oil and Gas Value Chain players. The Stanbic Business Incubator has concentrated on training and making Ugandan businesses astute over the last three years. When I speak about astute, I mean ensuring the visibility of demand, letting them know what opportunities are coming their way, and training them to become efficient, sustainable, and thrive.
There is no doubt that Ugandan businesses will seize the Oil and Gas sector opportunities with the Incubator’s support. For example, some companies that have come out of the incubator program are now huge players in the Oil and Gas space. One of the companies is Inspecta Africa, a company providing services to the Chinese National Offshore Oil Company (CNOOC) and has gone on to forge international partnerships with businesses across the region.
We also want to create stories that speak to employability for young people and steer financial rotation in the sector. We hope that as we support local businesses to become better, we can see many companies improving and actively participating in the industry. In the early times, not many Ugandan companies actively participated during the exploration and the appraisal phase. Many of them were sub, sub, sub, subcontractors. We want our companies to be contractors or subcontractors who are making real revenue and not breadcrumbs.
Ernest Wasake: Thank you for the excellent overview. What opportunities exist for SMEs in the Value Chain?
Tony Otoa: Enormous opportunities exist for SMEs in the Value Chain.
As you all know, the Government of Uganda has been very deliberate in ring-fencing some areas for local businesses. So Ugandan SMEs have priority when it comes to these opportunities. Some of these include civil work construction, transport logistics, catering, hospitality, security, manpower, etc. SMEs simply need to understand and prepare to apply for the opportunities.
As a business, you might have been in operation for a long time, but for as long as you have not gone the extra mile to make yourself known and active in the Oil and Gas space, it will be hard to participate. First, the Oil and Gas sector is capital intensive. Businesses need time to develop and become attractive to financing. That financing is now readily available.
Second, seek to understand the sector more by engaging with the different sector actors. We now see a trend of the Oil and Gas sector now coming back into the arena. Businesses need to seek partners to make this a reality through joint venture partnerships with local and international companies. If SMEs can do that, then we are doing well as a country because the sector proves that growth is possible.
Ernest Wasake: What policies exist to encourage SME participation in the Value Chain?
Tony Otoa: Uganda has done well in terms of policy and regulations for the Oil and Gas sector.
When we compare with countries like Nigeria, which has been producing oil for over 60 years, their local content regulations and laws came into play around 2010/2011. For Uganda, even before the Oil and Gas activities were fully operational, we created those laws, regulations and policies, which is a good step. We have policies that support the participation of local businesses in the Oil and Gas space under the local content policy. Some sector activities are ring-fenced for Ugandan companies, which is a great starting point.
These laws and policies are great, but if we do not have Ugandan SMEs who can manage to participate in that space, the law also allows foreign entities to take over the space. So it is upon us to take advantage of the policies and maximize the available opportunities.
Ernest Wasake: What would it take to increase SMEs’ level of participation in the Oil and Gas Value Chain?
Tony Otoa: We can do a lot to increase SMEs’ participation in the Value Chain.
I will share a story to answer the question. In 2018, I knew a company while I was at Total E&P as National Content Manager. This company wanted to do what the big players like Schlumberger, Halliburton, and Baker Hughes were doing. The company kept on bidding for those opportunities, but unfortunately, they kept falling off the grid. Why? They did not have what it took to participate in the sector. They had no policies in place. When we brought them on board at the Incubator, we trained them on a three-month program and coached them for close to nine months. During the same time, we supported them to get ISO certification and other certifications. As I speak today, the same company supports CNOOC in various operations and project work for an international logistics company. That shows you that it is possible in a short period for a small company to become a great participant in the Oil and Gas Value Chain, employ many people and create value in the country. This story speaks to the many businesses that still have the dream and hope of participating in the Oil and Gas sector.
Lastly now that the Final Investment Decision (FID) is soon, it is a signal to an excellent start for Ugandans participating in the Oil and Gas sector. But like the gun at a race, if you are not ready when the sound goes off, you are not prepared, and whoever is prepared will take on this whole race. Therefor SMEs need preparation to benefit from this value chain. As the Stanbic Business Incubator together with our partners we support SME preparation through training, information sharing and creating visibility over demand. We are positive that with these interventions we shall have more SMEs participating in the Oil and Gas value chain.