A Common Sense Approach To Life & Business

This morning I spent two hours tapping from the well of anectodal wisdom that is Mr. Yoshiyuki Sato, the MD of Kenya Nut Company, best known as the guys behind Macadamia nuts, Out of Africa brand of coffee and Aberdares tea brand. Mr. Sato was the guest speaker at the British Council's monthly Leadership Forum. "Personal Development: Critical Success Factors" was the subject, but he did more than that. Sato, who started and revolutionised the macadamia industry has a wicked sense of humor characterised by a self-effacing view of his abilities. But dont be fooled. Here is a man, who 33 years ago was able to convince the government that he could be the driver of the industry. According to a report he has co-authored with JGH Waithaka, his start-up, Kenya Nut was "appointed by the Kenya Government to spearhead and invest in the development of the macadamia nut industry in Kenya. The company immediately followed up the trees previously planted in the field totalling about 800,000, all but very few based on un-grafted materials, and encouraged owners to look after them and sell the nuts-in-shell to the Company. Simultaneously the company established a nursery to multiply specific selections previously introduced and locally selected so as to make available the essential planting materials. The Government intervention continued by way of getting bilateral aid from the Government of Japan to construct a macadamia nut research centre, equipment, transport and personnel for conducting research and providing extension services to growers. A training program was also drawn up for Kenyan scientists to relevant universities overseas to learn horticulture, pomology and related specialist subjects. The Kenya Nut Company has since 1975 been responsible for the commercial development of macadamia nut industry in Kenya by multiplying and supplying planting materials, based on selections from the research centre, to potential growers. The company purchases all the nuts-in-shell from growers, processes them and markets the kernels and other by products locally and internationally. The industry growth has been very slow due to financial constraints to meet planting material production according to demand. Research support from public sector i.e. the Kenya Agricultural Research Institute has been inadequate and a number of diseases and pests of the macadamia nut are causing economic damage. The industry is not threatened by this situation but its growth may be slowed even further. Recently other commercial participants have entered the macadamia nut industry by putting up small processing facilities but are not involved in crop development activities. Farmers needs for planting materials, husbandry knowledge and crop management on the farm are not being met fully because Kenya Nut Company has very limited resources for these aspects. It has spent over K.Shs. 600 million in developing very modern processing/manufacturing facilities, commands a world wide market and maintains a very efficient marketing system which could market much larger quantities than are available annually at present. Present Status: The Kenya macadamia nut industry is currently made of approximately 900,000 trees of varying ages from one year to 20 years, grown by over 100,000 small scale farmers with an average of 6 - 12 trees per grower. Annual production is about 4,000 metric tons of nuts-in-shell. These produce about 800 metric tons of marketable kernels, making the main commercial product. Other by products such as oil, are minimal. The future is bright because world demand could take over 20,000 metric tons of kernels per year. At the current price of K.Shs. 23/- per kg of nuts-in-shell the producers are getting Shs. 92 million per year." According to Sato, success is over-dramatised! You can learn more from failure than from success. One's critical success factor should be NOT TO FAIL! It is easier to learn why we fail, than why we succeed. Having come to Kenya to set up Toray (K) Ltd, a high-tech textile factory in Thika that was riding on the government's policy of import substitution, its failure ten years later taught him to start small and grow. He admires Julius Ceaser's management style built around the belief that if you put the right man in the right place, everybody is useful and more will be achieved. Ceaser succeeded because Romans trusted his vision and supported him. A leader must be clear about what kind of leader he wants to be. Having grown up in grinding poverty(had to eat grasshoppers for lunch) in post-war Japan, he drew six decade-long plans that would guide him:- Teens were driven by a desire to be in physical shape, 20s to set goals, 30s put in effort to achieve the goals, 40s await the results of the effort, 50s should develop based on the results and 60s to enjoy the fruits of his labour. Now in his late 60s, he is enjoying "bonus" years and looking forward to setting another six decades plan to see him to his 120 birthday. Cheekily, he hopes his wife can now allow him to have some girlfriends on the side! Widely travelled, he studied Urdu, Arabic, Persian, French and English in Toyko University. A book by Kwame Nkurumah motivated a desire to meet the author which saw him join Accra University and eventually meet most of the African independence leaders during a conference including Nkurumah, Nasser, Senghor, Balewa, etc. It was therefore natural for him to be sent by Toray to Kenya to start the textile factory. Today, his company employs 4000 and works with 50,000 farmers as suppliers. Kenya Nut is ranked as the No. 3 such factory in the world. For 20 years, the company did not pay any dividends and ploughed back all profits to development. His motivation was not profit, but growth and development. He has since diversified to cashew nuts, coffee and tea. Proud of their 3 year contract ot supply British Airways with in-flight snacks. His biggest regret is a failed venture in Brazil. He trusted his managers on the ground without any contracts. Though he wishes he could do business based on trust, common sense has taught him that you will burn your fingers if you trust people all the time. He should have put some contracts in place. In hindsightI. f you are guided by common sense he says you will be saved a lot of nonsense in your personal life as well as in business. Qoutable quotes Where there is a dream, there is a goal Where there is a goal, there is effort Where there is effort, there will be achievement. Its common sense he says. My take: Mr. Sato is more than you see. I believe he has some good lessons on how we can brand Kenyan agricultural products for markets out there. Close to four decades in Kenya should have earned him a place in one of the lately-in-vogue think tanks. His insight and experience is under utilised. I always associated Kenya Nut with local businessman Pius Ngugi, who is also associated with the local Volvo dealership, Esther Passaris and coffee plantations in Thika. The more you know, the more you dont......