Sovereignty is a dangerous term: Dr Manu Chandaria
Dr Manu Chandaria, CEO, Comcraft Group, at the 4th chapter of the African Entrepreneurship Summit, held in Mauritius from 02-05Oct13, where he was awarded the Lifetime Achievement Award.
Interview: Dr Manu Chandaria, Chairman and CEO, Comcraft group
‘Do not forget to…’ as the emcee at the African Entrepreneurship Summit tapers off at the beginning of the sentence that he wants Dr Manu Chandaria to complete, there is a palpable hush in the 300-odd members of the audience who are straining to hear the pearls of wisdom uttered by East Africa’s most venerable business leader. With his characteristic wit and charisma, the 83-year-old business visionary turns to his charming wife Aruna and says endearingly ‘…tell your wife that without her, nothing would have been possible.’
And this attitude of family-comes-first is what strikes you most about the chairman of the Comcraft group, a Kenya-based, $2.5 billion industrial behemoth which produces steel, plastics, and aluminum products from manufacturing facilities in 45 countries, 16 of which are in Africa. A family business managed by 50 family members, the East African conglomerate employs over 40,000 people. Besides UK’s Order of the British Empire, Chandaria also holds the title of the Elder of the Burning Spear, one of Kenya’s highest civilian honors. One of Kenya’s biggest philanthropists, his Chandaria Foundation is active in over seven countries, and has given away millions to causes in education, health and the arts.
In an exclusive interview with Africa Money, Dr Chandaria tells us how he kept his family in the business fold and nurtured the family business from a shop-around-the-corner in the Kenyan capital of Nairobi to the multi-billion dollar behemoth that it is today:
We all know that the Comcraft group has changed the business landscape of East Africa. If you could tell us a little about how it all began?
My father had come to Kenya to make a living. He was a farmer who found life hard in the arid soil of Gujarat and decided to migrate to Nairobi to give his family a shot at a brighter future. Initially, he only wanted to earn Rs 4000, go back to India and educate his children. When he earned a mere pittance of Rs 20 in his first 6 months at his first job, he realized he may not be able to go back anytime soon. But, he did not give up. He simply shrugged his shoulders, grit his teeth and settled down in the Kenyan capital. Through sheer grit and determination, he built a shop from scratch. He taught me the value of hard work, and I have him to thank for all the hard work I have put in over the years.
How did your business become so big from such humble beginnings?
In the 1960s, many African countries were becoming independent. We learnt that people loved our products but wanted us to make investments into their country before they embraced us whole-heartedly. From the start to the mid-1960s we created investments across East Africa in Tanzania, Burundi and so on. Nigeria was a window of opportunity in West Africa which opened up entirely by chance as a British company wanted to sell a pots and pans business. Today, it is one of our most successful markets. In 30-35 years, we seized all opportunities that came our way, turned most of them into successes even as we burnt our fingers with some ill-timed ventures like the garments business in Kenya and the steel business in South Africa, and finally evolved into a global business.
You were born in Kenya, went to India and USA for education and then came back to Africa in the family business fold. How did your travels affect your attitude to life?
I spent the first decade of my life in Kenya and thought for the first ten years of my existence that only two-storied houses exist in this world. Then came the 1940s with World War II quick on their heels, and my family moved to India. When we landed in Mumbai, we saw 6-storey buildings for the first time in our lives, were astonished at the sight of double decker buses and were rendered speechless by the wonder that was the Mumbai metro (or the local train as it is called colloquially). And then, when I went to the US to do my masters, I got an even bigger shock! Everywhere I looked, there were taller and taller skyscrapers lining up along the skyline. So, my horizons kept opening up, and I learnt to challenge my limits. It taught me to question why a particular economy is progressive and why mine is lagging behind. Finally, are we willing to accept that what we know is simply not enough?
How has it been like working across East Africa, with so much fragmentation among neighbouring economies?
Let me take the well-known example of the education sector in East Africa to explain how things always went. Established on June 29, 1963, the University of East Africa was initially formed to serve all three East African neighbours – Kenya, Tanzania, and Uganda – in the eastern African Great Lakes region. In 1970, it was split into three independent universities as Kenya, Uganda and Tanzania went their separate ways. And that summarizes how it has always been between East African economies – whether in education, or business or any other field. For instance, East Africa was a classical case for a Eurozone-like economic cooperation. With a common language binding the countries, much could have been achieved by way of a common market. However, there was power play with every country trying to gain the upper hand, and, when every country is trying to gain the upper hand, joining hands is simply not possible. But now, we are emerging from the shadows of the past and ploughing ahead with cooperative market communities like the East African Community (comprising Tanzania, Kenya, Uganda, Rwanda and Burundi) and the Economic Community of West African States (ECOWAS) with 16 member countries. Creating borderless trade zones across Africa is key to unlocking the potential of people, capital and products, resulting in maximum job creation.
So, did your experience in working across a tug-of-war environment in East Africa yield lessons on how to take everyone together in your family business?
(Laughs) Actually, here what really helped me was the realization that the term ‘inheritance’ immediately spells trouble as it nurtures ego. We taught all family members to understand that everything belongs to the family as a single unit, and not as a piece-meal inheritance. Most importantly, the 50 family members who manage the business were taught to keep only what they need, and give back the rest to society. Tolerance, patience, soft skills and interpersonal relations are a must…but what helped most of all was keeping my eye on the bigger picture and keeping my mouth shut! Sometimes, it is far better to give in for the sake of family and strengthen family ties, than it is to carry your point across and embitter a loved one in the process.
In the backdrop of the African Entrepreneurship Summit, can you suggest ways in which business leaders like yourself can be drivers of positive economic change?
I would like to begin by saying that business leaders can influence but they cannot outscore politicians in terms of power to change the destiny of a nation. However, government alone cannot do the job, and clearly, they have a tough job on their hands, with around 60-70 million unemployed Africans doing the rounds. Also, unless the government is prepared to create and invest in institutions for economic progress, it simply won’t work. In Kenya for instance, when the new government –the National Rainbow Coalition – came to power in 2003, they turned to the private sector for help to form an umbrella body. There were at that time over 200 associations, and, to top it all, each association had a chairman at the helm and all the chairmen needed to buy into the idea of a single umbrella institution governing them all. We turned to the government and, at first, we flatly refused to help with such a crazy idea! Later, we cooled down, collected our wits and made a counter offer to the government to give adequate training to government officers and make provision for sector specific boards before we agreed to make the impossible possible. This is how the Kenya Private Sector Alliance was formed- the umbrella body for all private sector bodies – an initiative driven by the government and implemented by the private sector.
Since we are in Mauritius for the African Entrepreneurship Summit, I would like to take this opportunity to ask if you have any plans on setting up business off-shoots here.
Well, back in 1983 when we first came here, we though the market size was too small for us to set up profitable operations on the island. I revisited the island a few years later to scout for business opportunities but there were only a handful of manufacturing industries here – tourism, sugarcane farming and textiles – and I did not think there was enough scope for entry in such a limited market. Unfortunately, I did not pick up on the signs that Mauritius was about to turn into a booming export-led economy and today, I feel that we have missed the tide when it comes to this economic major.
Which economy do you think is the best place for doing business in Africa?
I would put my money on Nigeria. It is a huge market and it may appear chaotic to an outsider but there are plenty of business opportunities for an enterprising entrepreneur who is willing to cut through the chaos and cater to the thriving population of the West African powerhouse.
What are your thoughts on Rwanda? It has been in the spotlight lately and has notched up an impressive ranking in the World Economic Forum’s Global Competitiveness Index for 2013-14.
Well, Rwanda may be in the middle of nowhere but it is rapidly moving up under positive leadership. The President, Paul Kagame, is seizing every opportunity to make it big. I like to think of it as a lotus blooming in the mud – given that it shares its borders with contending nations but stays untouched by neighboring tensions. The Comcraft group is present there and business is gathering momentum courtesy zero corruption and a stringent law and order situation.
How can Africa achieve its destiny?
First of all, I would advise against excessive pride in the term ‘sovereignty’. In fact, I feel sovereignty is vastly overrated as it only encourages nations and individuals to put ‘I’ and ‘me’ before ‘us’ and ‘we’. For a continent which has claimed over 50 million lives in civil wars, ‘sovereignty’ is a downright dangerous term. Taking the example of East Africa, it was much easier to do business and realize the potential of Kenya, Uganda and Tanzania before they attained ‘sovereign’ status in the 1960s and parted ways. I believe that the day that politics and religion move to sidelines and let economics take center-stage, Africa can realize its destiny. The other piece of advice is my message to individual business leaders: always meet your commitments ahead of time. If you can do yesterday, what is slated for tomorrow, you will develop a reputation for excellence and leave global competitors behind.
Finally, business talk aside, there is a philanthropic side to your activities which sets your organization apart. Does your faith in Jainism inform your philanthropy?
Indeed, Jainism believes what you need, you may keep, but what you don’t need, you must give away. We, as members of a giving community, wanted to give back to society. Interestingly enough, when I first approached my father with the idea of the Chandaria foundation, he blamed my US stint for making me think I could follow in a Ford’s or a Rockefeller’s footsteps. He dismissed my ‘American’ approach to philanthropy but I persevered and today the Chandaria foundation is active in over seven countries and has given away millions to causes in education, health and the arts.