2019 Sustainable Business Report

SAFARICOM SUSTAINABLE BUSINESS REPORT 2019 INTRODUCTION OUR BUSINESS OUR MATERIAL TOPICS STAKEHOLDER ENGAGEMENT CONCLUDING REMARKS 78 OPPORTUNITIES FOR GROWTH The 2019 Dealer of the Year awards and Dealer Conference sessions were combined into a single event. Dealers were treated to a demonstration of opportunities across new business lines such as Masoko, DigiFarm, Home and Terminals. Our programme to onboard more dealer vans, for which Safaricom supplies branding and recommended routes, resulted in phenomenal growth, from 200 vans in FY18 to 298 in the year under review. This will increase our market penetration into more remote areas and increase the uptake of M-PESA. SUPPLIERS SAFARICOM SPEND WITH SUPPLIERS FY19 FY18 FY17 FY16 Spend with foreign suppliers 33%* 29% 36% 36% Spend with local suppliers 67% 71% 64% 64% Total spend (KSh billion) 84.8 85.6 84.4 76.8 No. of foreign suppliers 182 194 193 174 No. of local suppliers 956 970 979 920 Total suppliers who received POs during the period 1,138 1,164 1,172 1,094 * This increase is attributable to our need to procure specialised network equipment that could not be sourced locally. We are, however, committed to growing the number and diversity of our local suppliers. SAFARICOM SUPPLIER PERFORMANCE Overall our suppliers scored 80 per cent (on-target) in the year under review, two per cent up from FY18, in evaluations of 605 participating suppliers. Underperforming vendors received performance improvement plans (PIP), providing them the opportunity to do better. SUPPLIERS’ RELATIONSHIPS WITH SAFARICOM During FY19, our finance operations changed the date on which suppliers were paid from the 15 th of the month to the 10 th , provided invoices were posted to the iSupplier online portal by the end of the preceding calendar month and goods or services had been delivered. Our suppliers have responded positively and are satisfied with our payments process. We have automated and expedited our purchase orders (POs) process by introducing catalogues and “touchless” (not requiring human intervention) POs, wherein sales processes are digitally integrated. By the end of FY19, over 75 per cent of purchase orders were touchless, reducing the PO turnaround time from an average of three days in April 2018 to half a day in March 2019. We set up a help desk with a dedicated email account to improve our engagement with suppliers. We conducted mini-forums in October and November 2019, attended by 240 suppliers, to provide feedback on issues they have raised, share our vision for sustainable business and encourage them to implement the SDGs into their own businesses. Our independent annual partners’ forum survey, conducted by TNS Kantar, received responses from 151 partners. There was a slight dip in supplier satisfaction from 94 per cent in FY18 to 91 per cent in the year under review. An NPS score, which assessed how likely our partners are to recommend our goods and services, was introduced for the first time. We achieved a score of 73.