New day for Barclays a big challenge

At Barclays's Queensway branch in Nairobi's Mama Ngina Street, with its huge banking hall reminiscent of its colonial history, each day has a new dawn, or pambazuka in Swahili.

The pambazuka is the most unlikely staff ceremony to be held each morning in a bank, before its large doors open at 8am. It is partly a catch-up meeting to discuss yesterday's performance and today's targets, and partly a small celebration with a song and dance, usually something children learn at playschool.

"Good morning, elephant, How do you do, I want to meet you, elephant, I want to dance with you," was the dance for the day, its purpose, a tradition of many years, being to energise staff for the day's work.   

Now Maria Ramos, Absa group chief executive and chief executive Africa for Barclays, wants to introduce the "energising ritual" to Absa branches in South Africa. "It's the power of pulling the African franchise together; I've been inspired by the pambazuka," she said at a brief meeting with journalists to talk about the One Africa strategy while she was in Nairobi at Barclays's  meeting of Africa chairs and chief executives.

Ramos has been tasked with combining the African and Indian Ocean operations of Barclays and Absa's South African and sub-Saharan operations into one bank, giving rise to skepticism that it might be a similar challenge to that of combining 27 countries in the European Union, each with its own culture, customs and traditions, some too diverse to allow for any collaboration, as the Greeks and Germans have discovered.

But Ramos says it is about sharing knowledge and "leveraging off other countries' experiences. We have products in the United Kingdom which we could bring to certain countries in Africa while also transferring products between countries. There are a lot of things which we can do jointly; we need to understand the things which we can share. People have similar aspirations."

Sharing products
But markets are different and Ramos says she understands that there must be some flexibility to cater for different customs and culture.  

Besides sharing products and knowledge, all African operations are preparing to share some functions such as information technology, which is being integrated by Absa chief operations and integration officer, seconded to South Africa from Barclays, Philip Freeborn, and will be run from Johannesburg. Finances will fall under Absa chief financial officer David Hodnett, who will also manage them from Johannesburg. The legal entities of Barclays and Absa will also be combined.

Kennedy Bungane, formerly head of Standard Bank's corporate and investment bank, is now chief executive of Barclays Africa, running all African operations outside South Africa, and head of Africa's strategy, including Absa, who reports to Ramos.

Bungane, who has been in the job since July, has already been to 13 countries. "No one gets married for the honeymoon," he says, meaning he had no time to engage slowly with his new role.

Combining the operations still has some way to go with shareholder and regulatory approval probably two of the major hurdles to overcome. The impact of sharing will probably save costs, as will access to capital markets for some of the larger infrastructural projects Barclays Africa will be hoping to finance.

Standardised systems
"The most organised global bank will best tap into some of the infrastructural spending which is taking place," Bungane says.

The downside may be that the reduced autonomy each of the countries is sure to encounter may leave a more bureaucratic rather than a nimble-footed operation. Imagine having to ask a central point, ultimately Barclays, for permission every time you want to do anything, a problem that Absa already seems to be having. Centralisation also removes ultimate responsibility from the line managers and, in the end, it is easy to shift accountability. And some kinds of "standardisation", as Bungane calls it, often do not work in all countries and cultures.

But Sanlam Investment Management Fund manager Kokkie Kooy­man says the standardisation of systems and controls in Africa will be a good thing. "You don't want to take away a bank or country's energy but, in banking, standardised systems and controls are a necessity."

Kooyman says the challenges for the One Africa strategy will arise in standardising staff policies in the different countries, and its success will depend on whether the newly combined operation will have the depth of staff to run it successfully.

"Africa has excellent growth potential but to operate on the continent you need good people and good systems."  

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