13th Annual International Management Conference Proceeding

population in Kenya especially in areas of dealerships 2 simu ya jamii (community phones) and what is commonly called
ongea 24/7 dealers (pre paid electronic airtime vending system using mobile handsets). The majority of those venturing
into these businesses though educated do not have the necessary management and leadership skills (NESC, 2006). And
emerging problems of disguised unemployment especially in the public sector, it is argued that any solution to the
current problem of high unemployment must therefore address this sector and the challenges arising there from.
The capacity of SME’s to analyze and understand their internal and external environment and adopt their strategies with
new conditions can help them to respond appropriately to these challenges. However, some do this more consciously and
successfully than others. This paper’s premise is that by facilitating an understanding of management and leadership
capacities, and how they can be strengthened, this may help SMEs increase their effectiveness. It reviews current
thinking, drawing on literature from fields such as organizational learning and change, strategic management, systems
thinking and complexity theory. It then proposes a number of considerations that may guide efforts to develop
management and leadership competencies particularly of emerging or entry level businesses with specific reference to
mobile telephone service vendors.
PURPOSE OF THE REVIEW
The management of small and medium enterprises considering that there are no entry and exit barriers is inundated by
multiple and diverse problems. The recently launched Vision 2030 for Kenya identifies a number these challenges to
accelerated economic growth as unemployment (especially among the youth as most jobs can be found in the informal
sector), rising disparities in income (hence the need for income redistribution), rapid urbanization (at a rate of 6% per
annum) and low savings ratio (16%) compared to the need. Given that urban areas will hold 60% of Kenya’s population
by the year 2030, then it is imperative that the economy must grow as projected at a rate of 10% and in the identified
growth areas. A critical challenge to unlocking the potential to this growth is the consolidation of the gains already
witnessed in the growth of the mobile telephony service sector that holds the key to economic growth through
generation of employment opportunities to absorb the large army of unemployed and particularly the youth. Studies
show that there is a high correlation between high mobile subscriptions or penetration and GDP growth not only in
Africa but in the developed works as well. In Kenya, the government has also recognized the vital role that this sector
plays in development and GDP growth as evidenced in the latest review of progress made towards implementation of the
economic recovery strategy for wealth and employment creation.
With an exponential growth 3 in the mobile telephony sector and the many entrants (no literature on entry and exit) in
the form of dealerships, simu ya jamii as well as ongea 24/7 dealers, this has tended to accelerate business dynamics that
has boosted the growth in subscriber base. The entrants to this sector in the three forms identified above do face a range
of challenges that forms the thesis of this paper. As new entrants and although well educated, they often lack skills in
management and leadership which leaves them figuratively putting out fires on a daily basis in a bid to gain both intra
and entrepreneurial capacity at a personal as well as organizational levels. Although there is consensus that small and
medium sized enterprises will fuel job creation, one pertinent question remains, how many of the people going into such
businesses as witnessed in the phenomenal growth of the mobile telephony sector have experience and knowledge of how
to use analytical and adaptive capacities to cope with the challenges of this new and rapidly changing technology based
business ventures.
METHODOLOGY
By and large, this was a desk study that focused primarily on reviewing literature on leadership and how this can be
configured to the unique needs of mobile phone vendors. However, as great limitation to the review was that the
reviewer is not a leadership theorist. The analysis of information reviewed and presented should therefore be viewed in
the context of the reviewer’s institutional affiliation which has a focus on capacity building i.e. arising from the review,
one question that the reviewer kept asking himself was what kind of training programs can be developed to target this
market niche?
2 Dealerships are well established businesses (at the apex of the entrepreneurship funnel) whereas simu ya
jamii and 24/7 as well as other community phone services are still at the entry level and characterized by a
number of vexing problems
3 The number of mobile phone connections were at par with fixed land line connections at approximately
300,000 in the year 2001, compared to 4.6million and less that 0.3 million respectively in 2005 (fixed line
teledensity dropped)
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