How can major multinational businesses successfully enter Africa? And, once there, what steps should they take in order to form business relationships and strategies that benefit both the region and the organization?
Answering these questions can be a complex maze for companies in the U.S., and most Western nations. As such, it was no surprise that over a hundred business leaders were eager to hear the story of GE’s initiative in Africa from a panel of GE execs this week, at the Executive Leadership Council’s 10th Annual CEO Diversity Summit at the New York Hilton.
The panelists — Michael Barber, VP of healthymagination; Deborah Elam, VP and GE’s Chief Diversity Officer; and Steve Bolze, President and CEO of Power & Water of GE Energy – were there for a single purpose: to convey how an initiative started by GE’s own African American Forum (AAF) led to a massive shift in GE’s business strategy, and eventually resulted in a three-billion-dollar revenue growth for GE’s business in Africa.
Moderated by Dr. David Thomas from Harvard Business School, the discussion focused on how GE used the AAF’s ideas and ingenuity to not only empower its employees to make a difference in Africa, but also to learn from their innovations and rethink the business strategy in the region – and thereby grow GE’s business in Africa from $700 million to $3.6 billion in revenue.
|New partnership: Lagos, considered the commercial capital of Nigeria, is pictured above. GE recently signed a deal with the government of Nigeria that aims to throw open the door to a host of collaborations in transportation, oil and gas processing, electric power generation, water treatment, healthcare, aviation and integrated safety and security systems. Photo: Wikipedia.|
The whole project, Elam pointed out, began with GE’s employees: “For a while, people were asking, ‘Why don’t we do something in Africa?’”
CEO Jeff Immelt then committed to a $20 million corporate citizenship program in Ghana that focused on infrastructure and medicine – specifically, bringing power, water, and healthcare equipment to a region that lacked all three. The key, Barber said, was to make sure that the company’s impact was lasting: “”Writing a check is easy. We wanted to make sure that what we were doing was really creating a footprint.” As such, GE created an assessment team that spent significant time on the ground in Ghana, learning about the region and its needs.
What they discovered was that traditional ways of providing energy and healthcare didn’t really apply. “We learned fast that we had to focus on portable products,” Barber said. “In Africa, people live in remote villages – they’re not going to make it to a central hospital. Also we needed to change disposable products to non-disposable, since doctors in Africa won’t throw them away – they know they don’t have spares.” Even basic issues, like backup generators to keep hospital lights on, needed considerable attention. “When a mother needs a C-section, there’s a 50% chance that during the procedure the power will go out,” Barber said.
Once the groundwork was done, the next step, Bolze noted, was connecting GE talent to business opportunities – which included relocating key employees to Africa. Right now, GE has 650 employees stationed in Africa – a number that will double in 4 years, according to Bolze. And the countries GE does business with are constantly increasing, with Nigeria, Rwanda, Tanzania, and more joining the list.
As for their advice to other CEOs looking to duplicate GE’s success? “You’ve got to be willing to commit,” Bolze said. “Your leadership needs to be in Africa, and we’re not talking about two-day trips….We’ve discovered the potential for GE in Africa – but we still haven’t gotten to the reality of it.”
* Read “Healthcare in Africa: A closer look at Ghana”
* Read “Grassroots innovation swirls at Nairobi’s Maker Faire”
* Read more Africa stories on GE Reports