Needless to say, microfinance institutions have been forced to go back to the drawing board in order to map out strategies on how to safely navigate the devastating effects of the Covid-19 pandemic. Biashara Leo ( BL) magazine speaks to Carolyne Gathuru (pictured) , a seasoned customer experience professional and the acting chief executive/ business development director, Springboard Capital about the new normal and how she is coping with it. Below are the excerpts of this interview :
BL: To what extent has the Covid-19 pandemic disrupted Springboard Capital’s business?
Carolyne: The disruption has been mind boggling. That is the most appropriate way to describe it. That Covid-19 has disrupted businesses is a question of how much and not if it has or hasn’t. I am not certain whether there is any business alive that has not felt the impact of this pandemic. We have had to look at almost every angle of our operations including our people and how best to keep them and their families safe, our workplace operations in all the branches and how to ensure that they are Covid-19 compliant for the safety of our internal and external customers, our processes to reflect upon what can be quickly rejigged to be remotely achieved and the need to be more in touch with the board in order to ensure fluid decision making and turn arounds can be achieved.
From a customer perspective, we have seen increased distress from otherwise smooth sailing customer accounts with business owners and individual customers alike, all reaching out to share the challenges they are facing in meeting their obligations. The microfinance sector generally has its fair share of unscrupulous customers who borrow with no intention of paying – they have been there historically to the present day. However, this season has placed increased pressure on otherwise well-meaning customers who have facilities with us,earlier taken to capitalize their business or individual ventures, who have found themselves at the end of a very tight rope,with no resources to make good on their repayment promises.
From a leadership perspective, the board has stepped up and the frequency of the members’ presence has been higher than before. There has been an increase in both scheduled and ad hoc meetings to help the company adjust to the unfamiliar path Covid -19 has yawned open with its unknown twists and turns. There have been board led scenario planning exercises to create possible permutations, develop adjustment strategies for each situation and mitigation and adaptation plans for the projected change. They have provided both functional and emotional support for the management team and staff. We have had the board chair grace performance management meetings to encourage team members to continue to focus on providing customer value, working as a team and to reiterate leadership support. This has served to inspire and motivate them.
Another major disruption has been bringing forward items within the strategy that had been scheduled for implementation at a later date. This is especially with regards to digital transformation to enable remote access to work resources in order to comply with the global efforts to flatten the national and global curve through working from home and cutting down physical interactions. Customer communication efforts that were significantly face to face in the office or at the customer sites have had to go digital with the use of digital meeting apps becoming a mainstay.
BL: Which measures have you put in place in order to address this disruption and ensure business continuity?
Carolyne: We have had to increase customer due diligence in order to know and understand our customers better in order to appreciate where they are coming from, what they are going through and what the future looks like for them. We have had to step up our empathy and have every single person in the organization amplify their empathetic gene as we handle customer matters. As the Covid -19 situation continues to cause economic devastation that far supersedes the health devastation in the Cabinet Secretary for Health’s daily briefing updates, so have the numerous loan restructure pleas and requests from our customers whose businesses are not operating normally. We have also chosen to become a beacon of hope for customers, to listen to them and counsel them and to uplift their spirits that better days are coming and that these hard times will not last forever. We have found the need to employ Solomonic wisdom to review requests on a case by case basis based on our customers’ history and situation, as the balance between keeping repayments in place to ensure that the business keeps afloat versus empathy with customer situations requires a higher level of discernment
There have been some customers though who have out rightly refused to make payments citing the government advisory for banks and other regulated institutions to provide moratoriums for their loanees. We have had to have tough conversations with them to advise that their loans are still active and have not been discarded and that they need to meet their obligations.
The other delicate balance has been to exercise caution with loan disbursements by reviewing applications whilst projecting loan performance based on the applicant’s sector of operation. This has served to provide capital for our customers who need to have a booster during this hard economic season and who have a clear path for growth and return. We have also seen an increased need to provide a second tier of customer advisory services for both incoming customers who have put in their applications, providing a review of their business plans and strategies to help them tweak areas that need adjustment to have them run their operations and activities better, as well as existing customers who have benefited from a review of their current status with an injection of new ideas that could turn around their areas of challenge. Indeed, our boardroom has become a business/entrepreneurship brainstorm workshop centre for customers.
We have also recognized that business continuity is a factor of the wellness and safety of our staff and made every effort to ensure that they are as best protected as is possible within the circumstances. Their physical wellbeing continues to be a high priority agenda with wearing masks, sanitizing, social distancing and temperature checks screening in place in all branches to enhance safety for the staff and their families, as well as customers, other partners and stakeholders. The cooperation so far has been excellent and we are hopeful that all will soon abate. In the interest of staff welfare, the company has also not put in place measures that affect staff directly as a result of the financial challenges posed by the effects of customer issues. Even with the need to have team members on a rotational basis, the company has made a specific decision to absorb the hit and to cushion staff from any drastic measures. The status quo has remained and it is anticipated to remain as things turn around in the coming quarters. This Covid-19 season has provided ( and continues to provide) an opportunity for employees to measure the level of care for internal teams that companies are putting in place and to really judge whether they are cared for.
BL: As a business, what lessons have you learnt from the new normal?
Carolyne: We have truly learnt that the new normal is abnormal. It goes against the grain of the social norms that have governed man and society over time. Adapting to change and adjusting to the abnormality of the new ‘normal’ is the way to go. It is very easy to get stuck and to mourn and grieve over what is lost and long for the beauty of the unencumbered past. We’ve seen this with some of our customers who are suffering loss and trauma of the this new uncomfortable status quo and are unable to get unstuck until we gently guide them out of the cloud they are in to think through possibilities to acclimatize.
We’ve also very quickly turned around and concluded that risk and business continuity planning are not strategic discussions that are to wait for quarterly board meetings, but are discussions to be held in weekly management meetings, with forecasting and planning over people, products and processes taking centre stage. Scenario planning has become the norm with all sorts of scenarios projected and brainstorming over what to do in case of ‘emergency’. There is greater collaboration between staff and the management team with each player in the field appreciating their individual and collective roles towards business sustainability.
The other lesson is that workplace real estate is overrated and is just symbolic of ‘the office’. We have come to the realization that it is possible to work remotely and to have many functions run from off-site locations by enabling technological access. Covid -19 is said to be the harbinger or better yet the trigger for digital transformation and it has truly facilitated the reprioritization of digital milestone planning. The jury is still out globally on the productivity levels with the work-from-home formula and whether this works wholesale for all, or is dependent on different members of the team and what works for them best. The issues of collaboration, mentorship and leadership influence poses significant challenges with remote working, but the benefits of the anywhere, anytime and on any device activities has its advantages. We have rescued what would have otherwise been downtime, with the team members meeting and progressing remotely.
BL: As a customer experience practitioner, what advice would you share with the microfinance sector players in Kenya during this challenging time?
Carolyne: First I would wish to point out that as the microfinance sector, the customer service chickens have truly come home to roost. The sector is facing unprecedented challenges as the depressed economy bites our customers on whom we rely to run successful enterprises vide disbursement of loans for capitalization. Local surveys indicate that access to capital is one of the biggest barriers in entrepreneurship and the microfinance sector serves to bridge this gap. With the ongoing erosion of customer trust – where customers harbour a misconception that their microfinance partner lacks empathy and understanding when pushing for repayments, there is need to communicate with customers openly and honestly. Customers value communication that is solid and has integrity even if it is not aligned in their favour. The customer communication plan at this challenging time that Covid-19 has thrust business into, forms the single most effective weapon against customer apathy. This is not the time to put out threatening messages or worse still fake empathetic messages, where there is pretense to be caring for customers, whilst in reality pushing them hard to breaking point. Every single customer communication on every single channel, needs to be assessed for authenticity. Customers are fully aware that the world is spinning on the Covid-19 axis and that it is not business-as-usual. Communication that seeks to inform, educate and partner with customers is key.
BL: Do you have any other pertinent issues?
Carolyne: The most expensive currency at the moment is empathy. Citizens the world over are experiencing heightened levels of anxiety about potential and actual health hazards, have lost or are in fear of losing loved ones, are operating out of their comfort zones with the cataclysmic disruption caused by Covid-19 and are trying to navigate the new abnormal normal. This is the state of the world today wherever we turn, whether in the physical or virtual realm. We all need to do our best to bring about calm and peace in whichever spheres of influence we permeate. The microfinance sector needs to step up and respond to customer enquiries, concerns and worries, from both internal and external customers alike. Every cloud has a silver lining and there is light at the end of the dark tunnel. Whether microfinance institutions will reach out for the shine that the silver brings, or move decidedly towards the light, will depend on the attitude towards the ongoing changes. The sector needs to drop its competitive characteristic, embrace collaboration, adopt an abundance mentality and work together for collective good.