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iHub By Conrad Akunga / September 28, 2012

The Trouble with Konza

17 Comments

By Conrad Akunga (cakunga@innova.co.ke)

The Konza Tech City Project is undoubtedly an ambitious project driven by a desire to catapult Kenya to the forefront of a technology renaissance. The idea of a city designed and built with the ethos of fostering a collaborative atmosphere of information technology that serves as a basis for business, research and development and education is truly an idea whose time has come.

However, as a student of history with a keen interest in ancient and modern warfare, I have become cognizant of the fact that most wars are not won by a single epic battle, but a series of small skirmishes. I say this because as an entrepreneur in the ICT sector running a software development company, much as I laud the Konza initiative as a whole, I find that for a small business such as myself with pressing challenges for me here and now, Konza has nothing to offer me.

Perhaps, first, some context.

I co-run a software company specializing in development of financial software and tools for the finance and investment sectors. My clients are banks, fund managers and private equity firms. This is a highly specialized industry requiring a lot of domain knowledge in financial instruments.

My chief competition, I find, is foreign firms, chiefly in Europe and South Africa. These firms tend to be larger firms in terms of staff and capacity. In other words, even before we get out of the gate, I am an underdog.

For local companies, when sourcing software from abroad, support and maintenance becomes a key issue because getting issues resolved requires flying in personal and accommodating them, which means an additional factoring in of costs and delays due to issues such as accommodation, logistics, visas and travel. This is over and above the costs and delays due to feature requests and bug fixes.

So enter Konza.

Konza is about 60km from Nairobi. I am being encouraged to take up space in Konza and move my company operations there.

My first problem is getting to Konza. Currently, my office is a 5 minute drive from my house. Similarly, my staff is at most 30 minutes away from the office. Having us to commute to Konza, in that Mombasa Road traffic, makes no logistical sense.

Konza Now

It is argued that there will be high speed trains to mitigate this. But there is the issue of getting to the terminals. Where will they be? People will still have to commute to them.

There is also the issue of quality of life. Commuting is a long and draining process. I would like to minimize this for myself and for my staff.

My second problem, assuming I have moved my company to Konza, is that my customers are still here. My customers and unlikely to move, and even if they were it would not be to Konza. Physical location is crucial for banks and investment firms. If we were to move, support and maintenance and business development would necessarily take a hit because my support and business development teams have to commute right back to the CBD they left in the morning en route to Konza.

One of the benefits I have over my competition is support is but minutes away. Moving to Konza directly jeopardizes that.

My third problem is that the Konza initiative does not clearly address some soft issues: employee or employer; we are all ultimately human beings with differing levels of actualization

  • One of my team members is doing ACCAs on a part time basis. How will he continue to do this from Konza?
  • For a youngish demographic, there are social considerations that come into play. Young men and women would like to have coffee with their boyfriends and girlfriends at Java. These boyfriends and girlfriends usually are in completely different industries. They would then like to watch an IMAX movie, after which they would like to proceed to a KFC for some chicken. How does Konza address this?Of course the other option is I could always physically move residence to Konza or its immediate environs. This introduces a new set of problems
  • How will I convince my wife to move with me, and be commuting to her job in town? What about her hairdresser? Her shoe shopping? Her girls’ nights out? Her membership in various initiatives like Rotary, etc.
  • What do I do about my children and their school? I want them to go to specific schools with a proven track record and opening a school in Konza will not resolve my concerns.
  • What social price will I pay, given my friends (many of whom are not in IT) will necessarily remain behind? How will I participate in other initiatives I am involved in such as mentoring, iHub, etc.?

In other words Konza as a concept, laudable as it is, depends on the success of many other small initiatives, many of which may not be apparent at first glance and will therefore take a while to properly actualize.

However, as with many things, the world will not wait for you to get your ducks in a row.

We Lack the Luxury of Time

I have no doubt the Government is sincere about Vision 2030, and that Konza will probably eventually work, given enough time.

However what I lack is the luxury of time. This is a dynamic and potentially vicious sector and I cannot be still awaiting developments.

This is why I feel in addition to Konza there are other avenues that the Government can explore with regards to fostering and growing a vibrant ICT sector that can yield results today.

All the poster children for growth like HSBC, Equity, Seven Seas, etc. were at some point small businesses that grew organically.

Personally I feel that a strategy that helps businesses grow right now, that can yield potential results today is a surer bet towards growing all sectors, not just ICT, and will yield development of all cities today – Nairobi, Mombasa, Machakos, Bungoma, Eldoret, etc. and not just Konza in 5+ years.

There are many things that can be done today
  1. The government has embassies and staff in most countries worldwide. By virtue of their being on the ground, the staff is in touch with the political, business and social climates of their assignments. Therefore they are perfect agents to assist me when I decide to do some business development in a foreign country.
  2. There is much talk about the effectiveness, or lack thereof, of tax rebates to stimulate industries. This is indeed debatable. What is not debatable however is that If government told me that it would waive my corporate tax If I demonstrated that I would not pull it out as profits or dividends but ploughed it back into R&D or growth and expansion- I would jump on that opportunity in a heartbeat.
  3. Government could also help me meeting some recurrent costs. Rent for instance. If there was a mechanism where if I could demonstrate product development, business development, implementations and support government would pay, or subsidize my rent, that would help operations.
  4. There has been talk of government giving preferential treatment to local firms when it comes to tendering for government projects. Let it be on records that i am deeply against this, as it unwittingly opens the floodgates for mediocre work to become the norm, sullying the water for all. However, in many tenders there are some conditions with nothing to do to the work being sought like capitalization. These could be relaxed or eliminated so that the playing field becomes narrowed to competition on delivery.
  5. Government could also partner with universities to build software and projects around needs they currently have. I see a lot of wasted potential in 2nd and 4th year university projects. Instead of doing abstract projects, why not have real projects that can be rolled out to serve a purpose? Over and above creating potential businesses and solving problems, students acquire real skills in the development, support and maintenance of systems.
  6. The Government should also lead by example. It is disingenuous to talk of eGovernment, cloud computing, and Kenya being an innovator and that same government has police stations and marriage registries using exercise books for record keeping. We need to walk the talk. Such projects could be done under the auspices of the point above.
  7. Government is talking up a lot of prime real estate in the CBD. Why? That space could be better used by businesses engaged in production. Granted there are ministries and government departments that need to be there for reasons of service delivery but how many are these?

Please note that at no time is government directly disbursing money to the SME. Money tends to corrupt good intentions. In this way abuse of the measures is mitigated against.

There are a host of other measures that I am sure like minded can provide that will lead to robust and sustainable growth across sectors across the country.

Conrad Akunga has worked in the software industry for over 10 years. He is a co founder of Innova Limited, a software company specializing in the development of software and tools for the finance and investments industry. He is also the co-founder of Mzalendo.com, a civic education and governance watchdog portal. He also sits on the Board Of Advisors of the Nairobi iHub. He is also a philosopher, writer and all round good guy

Image Credits

Author : Conrad Akunga


17 Comments
  • Denis at 20:18:34PM Friday, September 28, 2012

    can’t agree more. The govt should av thought of putting an enabling environment for ICT and entrepreneurial development. Konza city is a wise idea by the govt, but was not properly designed. Even the American Silicon Valley wasn’t builtin a day, but came about after years of research, innovations and concepts development. This is what we need. Satellite tech parks and biz parks for research, mentoring and innovations is all we need. Let the govt strewn them across the country, and wait for how amazing ideas and innovations will come about. Not Konza city!

    Reply
  • Carl Malamud at 22:18:08PM Friday, September 28, 2012

    Has government considered moving to Konza, then making the freed-up space in the central business district available to innovative startups at lower rents?

    Totally agree with you on the huge downside of a long commute. It would kill your business and sap your soul.

    Nice piece!

    Reply
  • rkahendi at 00:41:15AM Saturday, September 29, 2012

    Great piece. I have had a hard time taking Konza seriously. Why build a brand new city in the middle of “nowhere” when we have plenty of neglected cities that could do with just such a vision?

    Reply
  • Kenneth at 18:03:42PM Monday, October 1, 2012

    Nice job on addressing the very issues that face us day in day out as we commute to our work places.

    Reply
  • Jon at 18:53:05PM Monday, October 1, 2012

    I beg to differ Mr. Akunga. As much as I sympathise and agree with you on some of the points made above I personally think that the Konza project is meant to be much bigger than individual operations like your company. It is meant to create an infrastructure and provide a conducive environment that attracts larger tech investments to the country. Although it might seem as if it does nothing for you and your small outfit at the moment, I believe the impact will be felt when bigger players enter the market and seek smaller local ventures like your’s to partner with. So its not a lost battle as such.

    Reply
  • Upin Vasani at 20:09:23PM Monday, October 1, 2012

    Excellent write-up with constructive criticism. Brilliant piece for follow-up

    Reply
  • Wilfred Oluoch at 20:35:49PM Monday, October 1, 2012

    Very well put Conrad.
    I have always though that if the government setup a “super-connected” building in CDB or the environs and let tech-preneurs work from there, there would be no need for Konza. At least in the short term.

    How about a “Konza Building” right here in the CDD? isn’t that much easier?

    Some floors can be cubicles for incubation, some 1, 2 ,3, 4 room offices, other floors /wings can be taken by other tech companies.

    Have everything tech in that building. And make it as tall as times tower. Then you can have hellipad’s for bringing these Execs from the Airport (rather than a train to Konza). And A Hotel in the same building.

    Reply
  • John Weru at 22:47:17PM Monday, October 1, 2012

    Here is an article I penned in March about the Konza Technopolis. It’s an alternative view. http://www.konzaltant.com/index.php?option=com_content&view=article&id=47:konza-lessons-from-the-past&catid=34:articles&Itemid=53

    Reply
  • David Kimana at 05:58:54AM Tuesday, October 2, 2012

    Objective, informative, eye opening and straight to the point. Before embarking on konza, build on policies that will grow the ICT sector such that konza will be NEEDED in the first place

    Reply
  • Jim Shamoon at 07:25:15AM Tuesday, October 2, 2012

    Good article. Konza is great, but us guys cannot start looking at it till infrastructure is in and working and accomodation and social hubs ie java etc are operating.
    As usual govt is trying to emulate countries with far more resources. We are told of Dubai Film City, of South Africa, and others who have economies that can pay for this out of petty cash. We cannot tomorrow start a space program because richer countries have one. It is a great project, but for me, it is for later, right now I have issues with school fees……

    Reply
  • Ravinder Paul Singh at 08:53:23AM Tuesday, October 2, 2012

    The article has its agreeable and disagreeable notes. I agree largely with the author about the planning, incentives and lifestyle considerations. However, Nairobi is not the whole country, there should be specialized centers of excellence, which could be spread throughout the country to have overall development.

    If we were to take Konza city project and localize it to Nairobi, it would create other issues of urbanization – housing for increased nos., infrastructure support, traffic etc.Personally, I believe Nairobi is choking under all the masses which currently reside and commute to Nairobi.

    I do agree, however, that proper planning and lifestyle considerations do need to be taken into account. There should be some incentives that should be added for local enterprises – big and small. Initiatives like these are not always perfect and there would be some hitches along the way.

    A lot would be dependent on how committed the future governments are, citizens goodwill, serious considerations and mitigation of issues which the author has raised

    Ravinder

    Reply
  • Kim at 12:45:10PM Tuesday, October 2, 2012

    The government is cought up in a fantacy of an Ict park while the world’s technology is far much than that. Am talking about Trillions of USD investment in technology. We cant beat that but it seems as if the governmet wants us to be some kind of technology specialistic country. We are far below that line. Getting our economy to skyrise doesn’t need such things as Konza. It doesnt even need overspending. All it requires is investment in attractive business environment. The roads theyve been building is a nice eg. Now what remains is abolishment of corruption and harmful politics and such policies as would attract more investors into the country and gradually, unemployment will be done away with and we’ll be ahead in technology. Technology isn’t only about computers. It covers more and that needs more cash. We can’t do it alone without foreign investors in all industries. If we attract, bring ‘em and keep em’, then we don’t need to worry of no park building or anything. Foreign investors will do that for us.

    Reply
  • Francis at 08:25:48AM Wednesday, October 3, 2012

    Great piece or written mind. Konza is one very big ambitious dream of our government and country at large. In kenya, i believe we have thousands of graduates in technology every year and one measure to avoid technology and online crimes in future is to have such visions . Many countries in Europe have fallen into technology criminal gangs for not taking great measures earlier , Nigeria is an example here in Africa. The government the other day was suggesting to allow minimal tax to foreign IT firms who invest in kenya. this is also one way of helping the local people by creating jobs.

    I hope they have a package for the local investors who invest their resources, time , future and dreams to better our country and also help the country achieve its visions whether 2030 , now or future. Konza is one big step. but before konza , we need to have good transport system to and from the place, good and constant power supply, you can imagine having to have generator backups and using them all the time with all your servers and machines, water , security just to mention but a few.

    Unless we invest massive in the small issues i have named above, the city wont last even an year .

    my 2 cents

    Reply
  • David Svarrer at 17:41:35PM Wednesday, October 3, 2012

    Dear Conrad, That was some kind of sharing, huh? However, I think you have a big focus on what the government should do, and not so much of a focus on what is possible for us to do. Worst case – Konza city will not become reality – it is a vital focal point for the IT industry to see what is possible. Now, Silicon valley was built in the desert. In terms of all the problems raised, I find them minimal. Basic needs for a Konza city to start, is not gazillions of money, but the right mindset, and sufficient with people having that mindset. I see in Konza city a vision which has been pretty clearly published. I also see possibilities for a growth for our region without comparison with anything from the past. And then – contrary to what I read from your very well written article, I tend to disagree that the government should do very much more than just “make it possible”. Already by now, a very good (main – Mombasa) road connects Konza City. Water, electricity should not be difficult to find. Power can be generated by solar panels. No generators needed. If we do here in Kenya what they do elsewhere – have the government provide what they are best at: Infrastructure, then let industrialists provide the rest – then I think we have a formula for success. With infrastructure I mean: Land, Roads, Rails, Water, Sewage, Power, Communication.

    Then let the rest of us rent plots there so that we can start building this great vision and make it happen.

    Warmly
    Svarrer

    Reply
  • Adamsy at 13:55:00PM Saturday, October 6, 2012

    Awesome thought about the whole Konza City concept. I like point no. 5! Glad the university I’m at is currently on a pilot program for such initiatives. To let students work on real life projects and help automate some of the governments systems.

    Reply
  • Robert at 15:04:37PM Monday, October 8, 2012

    Thank you for a great insight to this dream especially by challenging the ‘comfort zone’ around Konza where no one wants to talk negatively about something that kind of makes us proud.

    However, i beg to differ with the location issue. Most folks who live in Nairobi are not actually born and raised in this city. They moved because something was calling. Konza might be a city that was placed ‘nowhere’ but the bigger picture is actually the infrastructure that will AROUND it.

    You and your family might get a better(new) house and your staff will not have to commute as even cheaper housing will be in the vicinity.

    Reply
  • Francis at 14:58:19PM Monday, March 18, 2013

    Conrad, those were some realistic points you raised. The unfortunate thing is, the government would’ve been better off trying to solve things the slower, growth focused way, so that as Kenyans, we stumble as we find our way so that one day we might be able to compete globally. These multinationals will come here but will never release their trade secrets to us, and us they bring their dollars and expertise, many companies will focus on their solutions. However, all is not lost, we understand the local problems, better than the multinationals and if we focus on that and providing value, plus going out of our way, to accomodate how kenyan businesses operate, we will succeed, All the best to us

    Reply

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