When in August, Captain Irene Koki Mutungi, a pilot with Kenya’s national carrier Kenya Airways, flew into Nairobi the airline’s fourth Boeing 787 Dreamliner from Boeing’s assembly site in South Carolina, United States, it did not make much news.
The fact that she is Africa’s first black female Boeing 787 Dreamliner certified Captain did not make headlines either. The story was the plane.
Mutungi was raised in what she describes an aviator’s home. Her father was a pilot with Kenya Airways.
“My most memorable moment was when I flew with him on a flight he was commanding to London. I was about five years old. From that day, I promised myself I would one day become a Captain,” she reminisces.
She says she’s fortunate to be born into a family where excellence and integrity were all-important. She has become more conscious of the real world and is motivated by the fact that women, especially African women, can excel in everything. Has she ever encountered discrimination as a woman?
“Unfortunately, such is life. Anytime it has happened it has increased my resolve to keep aiming high. In my early years in aviation, a passenger disembarked because he said he wasn’t a guinea pig. That can tell you what I’ve been through sometimes.”
In many parts of the world and especially Africa, it’s still a man’s world. The stereotype of the working woman is rarely attractive with popular culture portraying successful women as consumed by their careers.
“As for stereotypes, this one too is far from reality. There are countless women successful in their careers and dedicated to their families and communities at large.”
Mutungi cites Liberia’s President Ellen Johnson Sirleaf, former Malawi President Joyce Banda and Nkosazana Dlamini-Zuma, the Africa Union Chairperson.
“Just like those African leaders and other women who are anchors of their households and communities, I too am a dedicated person who always strives towards excellence while remaining committed to what matters. I do that by being a model mother, model daughter and a role model to my African sisters.”
Mutungi describes her journey to the top in a male-dominated industry as one filled with commitment, sacrifice and support from friends and family.
Fear is at the root of so many barriers women face. Fear of not being liked. Fear of making the wrong choice. Fair of failure. How does Mutungi handle fear?
“I don’t know what fear means. Yes, sometimes I may ask myself questions, but every situation is handled in a way that leaves me in control.”
She says she rarely has sleepless nights. “If I stay awake at night, it’s not usually anything of concern. I think of how great an aircraft the B787 Dreamliner is. Boeing has delivered a masterpiece.”
Mutungi wants to be remembered as an African mother who tried her best to change the narrative of the African continent.

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Flying The Dream

Arrivals and departures in Nairobi these days look more like a wedding venue than an airport. Huge white tents make up for the charred remnants of the arrivals hall.
Children sleep on chairs in the morning chill, as passengers crowd under canvas. This is Jomo Kenyatta International Airport (JKIA), in the wake of the crippling fire on August 7.
For five hours, flames tore through the fourth busiest airport in sub-Saharan Africa. It disrupted trade and travel plans for tens of thousands of people as Kenya heads for its tourism peak season.
The annual wildebeest migration alone draws thousands to the Maasai Mara in July and August.
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“We are going to put up a temporary terminal that will take about 2.5 million passengers at the same time. We will also fast-track terminal four, which was meant to be opened sometime in March next year. We need to think how we can bring it forward,” says the airport’s manager, Edward Kobuthi.
The fire was another blow to Kenya Airways. It has struggled through turbulent times after reporting a $7 billion loss in 2012. The fire forced the airline to cut international flights by 25%.
“Roughly in terms of revenue, not bottom line, we have lost about $4 million against our plan,” says Titus Naikuni, CEO of Kenya Airways.
“What has happened is that we have changed a number of things. We have moved our international flights to the domestic [terminal], which means all our departures are through domestic. That is very congested.”
“A simple fire gone bad,” says President Uhuru Kenyatta, who criticized the authorities for failing to modernize the airport and for their handling of disasters.
The International Civil Aviation Organisation (ICAO) stipulates that fire fighters should be at the scene of a blaze in three minutes. It took Kenyan fire fighters at least 40 minutes after the fire broke out at around 5AM.
The fire is also likely to slow the expansion of the airport, which has dragged for months following leadership and financial wrangles in the Kenya Airports Authority (KAA). The project—expected to break ground this year—may be delayed, hurt the economy and frustrate Kenya Airways.’
“Kenya Airways&#8217; expansion plan is entirely correlated to the successful and speedy expansion of JKIA. The airport experience has been suboptimal for a while and I am sure Kenya Airways is hoping that the fire is the catalyst for a more aggressive KAA,” says Aly-Khan Satchu, an independent analyst.
KAA plans to expand the airport, which is a regional link to Europe, the Middle East and Asia, in order to handle traffic of 17 million passengers per year by 2020 from the current 6.5 million. In the wake of the fire, it has its work cut out.

Tents, Tribulation And Complication After A Simple Fire Gone Bad

At a quarter to noon on a slow Friday in November, Aslam Khan is in a hurry. As he leaves his third floor corner office, he punches buttons on his BlackBerry. “I’ll be there in a flash,” he says in a deep baritone voice that doesn’t appear to fit his body.
Khan is the chairman and co-founder of Aviation Leasing Services (ALS) Ltd, an aircraft rental company based in Nairobi. He knows that when it comes to flying, time is of the essence, and he runs downstairs to the hangar where Captain Nahashon Mutea is waiting for him in a chopper.
The journey to Kisumu, a city 500 kilometres west of Nairobi on the shores of Lake Victoria, lends a rare chance to interview the aviation entrepreneur where he makes his money—up in the air. Khan, a renowned rally driver, has a tough race the following day, but right now that is the least of his worries as the helicopter rattles through headwinds.
“Kenya is such a beautiful country,” he says, peering down at the green tea estates hemmed in by forests that dot the Great Rift Valley.
Flying a chopper on a hot and humid day is a study in the business of running an aviation company. Everywhere you look there are risks—turbulence, fog and the deadly possibility of mechanical failure. As co-founder of ALS Ltd 20 years ago, Khan, along with his late brother Ashraf, has piloted the company from a scrappy outfit, with a single Cessna 150 aircraft, to a thriving company with 25 planes and three subsidiaries.
“The aviation business is not for the faint-hearted,” says Khan, who turned 60 in December. “It’s a very sensitive business.”
It is so sensitive that the recent volatility in the Kenyan shilling forced the company to charge Kenyan clients in dollars to avoid exchange rate losses. Even a small rise in interest rates can ground business, he says, given that regular piles of cash are needed to finance operations.
ALS Ltd leases aircraft to humanitarian organizations like the Red Cross and World Food Program as well as oil companies; it also operates charter flights for businesses. The firm has shareholdings in local airlines Safarilink and Severin Air Safaris and runs Heliservices, a wholly owned helicopter division.
Khan is a former Kenya Airways (KQ) pilot with experience in the Kenyan Air Force. He joined the Air Force in 1970, where he completed his training as a pilot. Six years later, he joined East African Airways, which was later absorbed by Kenya Airways when it was carved from the regional carrier in 1977. He says that if it were not for the Air Force, he would probably be doing something different today as his father could not afford fees for a commercial flying school.
“When I was growing up, I always wanted to be a pilot,” he said back at his office at Wilson Airport, near Nairobi, “but I also dreamed of owning a professionally run business. I had achieved my pilot dream; now it was time to chase the business aspiration.”
While at Kenya Airways, Khan says he started saving up and together with his brother, Ashraf, they bought a small Cessna 150 aircraft worth $7,000 so Ashraf could learn to fly. That was a fortune in an era when flying, let alone owning a plane, was a luxury for government officials and rich businessmen.
“We leased the plane to a flying school and discovered that it was an interesting business,” says Khan.
The lease gave them the business name, Aviation Leasing Services, too. As ALS’s fleet of aircraft rose, so did Khan’s position; he became the Airbus captain for Kenya Airways in 1991.
At the time, Somalia was slipping into anarchy as President Siad Barre was overthrown. Sudan was at war. Humanitarian organizations started trooping into the countries to assist the innocent civilians caught in civil war. This presented an opportunity in the relief business which Khan and his brother seized. Most aircraft serving the countries were foreign, mainly from South Africa.
“We got into relief and grew the business over the years,” he says.
Expansion was a problem—in the 1990s, financing was hard to come by, especially for African-owned businesses.
“We had to depend on leasing aircraft from outside because there was some kind of stigma about Africans. We had to negotiate through leasing until we started owning our own airplanes.”
ALS outgrew the stigma and eventually won the confidence of banks to expand its fleet. Khan had to quit his captain’s job in 1992 to take charge of the business and in the same year, his brother and co-director died in a plane crash. Every opportunity in aviation came with competition and as he discovered to his chagrin, pilots were not only rare and sought after, they were also fickle and open to the highest bidder.
“We do a lot of pilot training, but many move on to other airlines. It’s a reality we have to live with. Retention of pilots is a major problem because people tend to move to better conditions and bigger airplanes. We try to have retention schemes and more opportunities for pilots to grow, but it’s hard to stop it.”
With ALS and three other aviation companies, Khan is still dreaming big. Last year, he relinquished the CEO post to Cornwell Muleya, a professional airlines manager from Zambia, partly as a succession plan and to bring in new ideas. Going forward, ALS plans to work with Kenya School of Flying, which is run by captain Martin Ririani, his former colleague at Kenya Airways, who quit to start training pilots.
“We want to set up an academy for flying,” says Khan. “Kenyans are hard-working and there’s huge potential for pilots, even in the region. The only way to overcome supply and demand is to have enough pilots. We’ve got infrastructure to train and the opportunities. Many people leave Kenya to go to South Africa and the US to train as pilots. Local facilities are inadequate, so we are in negotiation with schools in Europe and South Africa to see if we can partner and set up a high-standard flying academy.”
The larger plan is to make ALS a one-stop shop for aviation services and solutions—from leasing aircraft and training pilots to operating scheduled flights. This is a highly capital-intensive business and the founder is scouting for a management buyout to bring in investors.
The idea of a management buyout is more of a succession plan. The business is very much a family culture, he says, and he is looking to change that by turning it into a corporate business. “This is very important,” says Khan, who was voted the best rally driver for 2011 by the Kenya Motorsports Association.
“To achieve success companies have to be run professionally. Family can be involved in the business, but successful companies are the ones that follow corporate governance.”
He says family-owned companies lose out on the contribution given by professional managers, though they enjoy the virtue of trust—critical for business and hard work. But trust can be extended to employees if you find the right ones. Khan says that in a competitive market, even family members find it hard to resist the allure of better opportunities outside. “My niece started with us as a pilot; now she has joined Kenya Airways.”
Reputation is critical and so the company’s operations constantly undergo audits carried out by its customers and industry regulators. The company invested millions of dollars in meeting security and safety benchmarks, including IATA Operational Safety Audit (IOSA) certification for meeting international aviation safety standards in June 2011. It is the second after KQ in Kenya to get such a certification. In September of the same year, the firm was admitted to the International Air Transport Association (IATA), joining KQ and Precision Air in East Africa.
Khan says this has positioned ALS to partner with major airlines and global aviation firms to expand its market. It can now lease its aircraft to leading airlines and is in talks with national carrier Kenya Airways. It already leases to RwandAir, Southern Star Airlines in South Sudan and an airline in Sierra Leone.
To serve bigger carriers it needs medium-sized planes in the 70 passenger capacity. But that needs more cash, he says, with a single unit going for $10-25 million. “We are looking at Dash 8 models. But then this means we need cash to buy enough parts and staff like crew and engineers etc., and unless it is backed up with a contract, it’s difficult and risky to invest.”
ALS has found itself with idle planes like other airlines—unable to stay afloat due to cash flow problems which ground operations, such as the Southern Star of Juba and an airline based in Sierra Leone, which stopped operations last year.
Piloting and rallying experience has given Khan some of the most important management traits: focus and attention to detail. “Rallying has been very much in the family and when on the rough and at times muddy roads you must focus, just as with managing any business.”
Rallying is an expensive hobby and he has to invest both time and money into it. His best career moment, he says, was when he qualified as a pilot in the Air Force. So does that mean good pilots make good managers?
“Good pilots are not necessarily good managers and good managers are not necessarily good pilots. I’m lucky I got both,” he says philosophically.

From The Cockpit To Corporate Suite

As far corporate dreams go, Titus Naikuni’s is a grand one. The group managing director and chief executive officer of Kenya Airways (KQ) wants to become the British Airways of Africa by doubling its fleet and destinations in the next five years.
“We want to expand our fleet from 33 to 68 in the next five years, then to 170 in the next 10 years,” he says. “And our destinations from the current 55 to slightly over 100.”
The airline flies to 45 countries in Africa, and if you throw in South Sudan, Kenya Airways has nine countries to go before its deadline of 2013. From those 45 destinations the airline rakes in 60% of business from the continent, carrying more than 1.8 million passengers a year. “We still have a lot to do in terms of frequencies. We have more than one frequency only in East Africa and South Africa. I want to be in a position where every city has more frequencies. Right now you can fly from here to Jo’burg in the morning and come back in the evening. See what that has done to business.”
In Naikuni’s top drawer lies an A4 printout of an economic analysis of Africa by The Economist and the International Monetary Fund, titled African Opportunity.
According to its figures, the continent is among the fastest growing economies in the world. In the 2001-2010 decade, six African countries—led overall by Angola at 11.1%, then Nigeria, Ethiopia, Chad, Mozambique and Rwanda in that order—were among the world’s 10 fastest growing economies alongside China, Myanmar, Kazakhstan and Cambodia.
But what has caught the eye of managers at KQ headquarters lately is the 2011-2015 projections of global economic growth. While it puts China number one overall, with 9.5% average annual growth during the period, it lists seven countries from Africa among the top 10, led by Ethiopia at 8.1%, followed by Mozambique, Tanzania, Congo, Ghana, Zambia and Nigeria.
“That tells you where the money is,” says the Harvard Business School graduate and qualified mechanical engineer from the University of Nairobi.
“Africa has the biggest potential for business in the world. African routes are profitable, if you don’t look at a route on its own but the network created. You could lose money on one route but feed into others to make up for it.”
It has not been all rosy for Kenya Airways, though.
There have been bad moves, like flying to Malabo, Equatorial Guinea, where government restrictions led to the airline closing.
For close to four years, airlines have been on tenterhooks after demand fell during the financial crisis. The latest forecasts are not a pretty sight.
While the International Air Transport Association (IATA) upgraded its net profit forecast for the global airline industry in September from $4 billion to $6.9 billion in full-year 2011, it still projects a lower net profit of $4.9 billion for 2012 due to sluggish growth and weak profits.
Yet with the rise of Africa’s economic power, airlines are often times dealing with the opposite: moments when there are too many travelers for a few planes to soak up.
So, those who can afford it are increasing frequencies and routes to draw in excess travel demand when it happens.
“Amazingly, Africa is starting from a low base in economic growth. Many of the things that affect other major airlines globally like SARS, the 9/11 recession, don’t affect Africa. What tends to be common is fuel,” says Naikuni.
Kenya Airways, listed on the Nairobi Securities Exchange in 1996, has managed to survive fuel cost volatility which it hedges by taking long-term fuel contracts at a fixed price. “Three years ago, we didn’t get it right. We hedged top end, at a higher price, and when it came down it was so much, we really suffered. Now we hedge top and bottom but you can’t hedge everything,” he told FORBES AFRICA.
Naikuni joined KQ in February 2003 from a mining company, and talks of competition with the spirit of a Moran, the name given to the ferocious warriors of his Maasai community.
“Competition will never kill you, it is healthy,” he says.
Naikuni has arguably turned around Kenya Airways to be one of the most profitable airlines in Africa. It remains a top performer on the Nairobi Securities Exchange, where it listed in 1996 through an IPO.
Brought in from February 2003, after revenues started slowing down in 2000, Naikuni introduced what he called “shock therapy”. It included streamlining management and reducing waste—some managers were fired and new faces brought in.
“You must focus on people and lead them in the right direction. Give them hope and pay them well, though no one has been satisfied with money. I also give people space, but it doesn’t mean I won’t come down on you,” he says.
The same year that Naikuni took the helm, Kenya Airways bought a 49% stake in regional Tanzanian carrier Precision Air, to counter South African Airways’ 49% buy-in in Air Tanzania.
Later, he closed down Flamingo Airlines, which had been set up in 2000 to provide feeder services for domestic fleets. Now, he is reviving a similar model next year through Jambo Jet.
“Abandoning the domestic circuit was a mistake. We let our rivals dominate but we are regaining the market,” he says.
The other strategic move was to pull out of Kencargo, the cargo firm jointly owned by KLM, to form KQ Cargo, which has proved profitable.
His tactic of offering lower prices on domestic routes, which has turned Kenya Airways into a virtual monopoly, is deeply unpopular at Jomo Kenyatta International Airport, the region’s airline hub where rivals like JetLink, Fly540 and Air Kenya also operate.
Many view the move as tantamount to grounding its competitors, to which Naikuni replies: “If you go in the kitchen, be prepared to face the heat and if you are not, open the window and jump out.”
Then, there’s the issue of the Douala accident, in which a Kenya Airways Boeing 737-800 crashed in a swamp in Cameroon and killed all 114 people on board. As the African opportunity expansion unfolds, that incident remains etched  in Naikuni’s mind.
“We have recovered from it,” he says, but the impact is still evident in his tone.
It’s a sobering thought as Naikuni reaches for the skies.

Tag: Kenya Airways

FORBES AFRICA SOCIAL MEDIA

Flying The Dream

Tents, Tribulation And Complication After A Simple Fire Gone Bad

From The Cockpit To Corporate Suite

Sky High— Where The Money Is