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Africa Outlook

MTN Rwanda
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Rwanda technology
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MTN RWANDA

The country’s leading telecom operator has overcome recent challenges and is now striving for even further revenue diversification under the stewardship of its new CEO, Gunter Engling

All Smiles at MTN Rwanda

Writer: Matthew Staff

Project Manager: Donovan Smith

 


MTN Rwanda has overcome strong market competition in recent years to once again solidify its positioning at the top of the country’s telecom market, with a new Chief Executive Officer (CEO) keen to maintain the strong momentum achieved over the past 12 months especially.

Having been a part of the wider MTN Group on the continent since 2002, the new incumbent, Gunter Engling is all too familiar with the facets that have made the brand name so successful in Africa and the Middle East. With an infrastructure - both internal and external - full of potential, he is honing in on the few remaining areas in need of improvement.

“When I joined in July, 2015, I found an operation that was well run and well on its way to revenue diversification,” Engling says. “When Airtel and Tigo arrived in the market a few years ago, we had to get used to having competition, but my predecessor did a wonderful job in making MTN Rwanda a lot more agile and a lot more efficient.

“However, one thing that I did notice, especially among our younger staff, was that people weren’t coming to work with smiles on their faces, so we have worked hard on creating an engaged and smiling workforce.”

Engraining a more positive and productive culture doesn’t require a lot of investment, rather a change of philosophy, and this has been achieved subtly and methodically since the new CEO’s arrival; subsequently having a positive knock-on effect on employee efficiency and overall productivity which Engling expects to become even more evident in the future.

“We’ve tried to get those smiles back by finding a way to relax in the work environment while still actually completing the work,” he notes. “Even though we have less people in the Company than a few years ago, we can still go home at the end of the working day knowing that we are more efficient, happier, more productive and serving our customers better in the process.”

Revenue diversification

As a Rwandan-owned Company, this ethos surrounding enrichment and individual development is equally prominent within its corporate social responsibility efforts; MTN being one of the only corporates in the country to consistently give back to the surrounding communities, both financially and non-financially.

However, it is still the Company’s renowned market offering which most sets it apart from the competition, and Engling is keen to continue the diversification of services which began under previous CEO, Ebenezer Asante’s guidance.

“The diversification is going very well with almost 45 percent of our revenue now being generated outside of voice services,” Engling explains. “A big chunk of that now is data, because while handsets are no longer our core business, data continues to grow.

“The next big focus area for us is digital, breaking it up into lifestyle, entertainment and ecommerce as part of our value-added services, to diversify even further away from voice which continues to be a very challenging business.”

This diversification isn’t just tailored towards the consumer space either, with its corporate offering every bit as critical to the ongoing portfolio under the MTN umbrella. The Company’s success in this area harks back to a historical advantage derived from longevity as much as differentiation in what is still, in some cases, a developing area.

Engling continues: “We have the biggest infrastructure footprint in the country so for us to connect a bank with 50 or 60 branches, for example, is complex but achievable within our own infrastructure. Other operators would have to put together a puzzle of infrastructure providers, so this is a key advantage for us.”

This isn’t to say that there aren’t still challenges or that there isn’t the need for higher levels of education though, and it is the remaining market opportunities which the CEO has earmarked as pivotal telecom battlegrounds moving forward.

He adds: “For us to convince that same bank that we can also host their primary or secondary data centres better than they can themselves is a lot more of a challenging selling proposition, but that’s where a lot of drive will be targeted in the future, and we are known for providing new value-added services already available in more developed markets.”

Mobile money

Arguably the most successful strand of MTN Rwanda’s diversification, however, has been seen through its mobile money offering, which now forms 5.5 percent of its revenue and looks set to become its biggest differentiator over the coming months and years.

“We’ve been very focused on not just the usual cash-in and cash-out aspects, but on launching new products and services within mobile money,” Engling explains. “Since 2014, this has included the ability to pay taxes, utilities and even school fees through mobile money.

“One of the biggest differentiators within our mobile money service though is regional remittances, and setting up payment corridors with neighbouring countries like Uganda, Kenya and a couple more.”

This isn’t necessarily a way to extend the MTN reach, but to once again enhance the accessibility to previously unavailable services for its customers, with the Company subsequently partnering with the leading telecoms provider in each of the aforementioned countries - MTN Uganda and Safaricom in Kenya, respectively - to provide the most efficient corridor possible for money to flow internationally.

“Mobile money in East Africa is so well developed that you have good products in every country, so you just have to link to the main player in that country to avoid it being as challenging as it is sometimes in other regions in Africa.”

Future progress

As a result of this ongoing commitment to diversification and delivering a portfolio designed to cater for consumers’ and corporates’ requirements, MTN Rwanda has overcome the challenges endured at the start of the decade to still own a 50 percent market share in regards to SIM cards, and a significantly higher share when it comes to value.

While this partially harks back to the longstanding presence that the Company has had in the country, the ability to move with the times and remain the leading operator across all segments is no mean feat.

Value-added services like mobile money further compounds this market advantage and will also be supported over the course of 2016 by a more concerted drive into a strong fibre offering for corporate customers and also within the mobile space.

Engling concludes: “It will be a continuous evolution in terms of investments and improvements. There’s a fair amount of investment going into getting 3G speeds up as high as possible on the data side while, in terms of projects, we have plans to roll out our fibre network to businesses.

“We are also looking at how else we can roadmap future products in things like mobile money to bring an even more enhanced offering online in the future.

“Roadmapping future progress areas in the digital space and on the enterprise business side - including things like hosting and cloud services - is also an aim, and while they’re fairly new and in their infancy at the moment, these will be the kind of differentiators we look towards once that initial customer hesitation is over.”