Nation Media Group yesterday 1st July announced plans to reorganize its business, hinting at an overhaul of its operations that will result in new structures, job losses and, possibly, relocation of offices.
The restructuring has been catalyzed by the adverse effects of Covid-19 pandemic, which have pushed down revenues and changed media consumption trends as more people turn to their smartphones for news and information.
Small is beautiful
Suddenly, small is beautiful for a big media house with operations across East Africa.
NMG, hoping to ride the tech wave made more popular by stay-at-home protocols for stemming the spread of Covid-19, is betting big on mobile delivery of its journalism products and advertising. “This new reality necessitates the reengineering of Nation Media Group to accelerate its digital transformation,” the company’s CEO Stephen Gitagama said in a circular to staff on 1st July 2020.
“In this journey, the group seeks to be innovative, agile and adaptive with the objective to take up leadership in the mobile publishing landscape in Africa while passionately living our mission to positively transform society, by creating new value and generating quality, differentiated and engaging content to consumers, however, wherever and whenever they need it.”
The company will be concentrating its investment and human resources on new areas critical for growth. Inevitably, this will result in merging and scrapping of some sections which will in turn lead to a reduction of its workforce. “This is an extremely difficult decision in view of the prevailing circumstances,” he said.
Insiders say the company is targeting to offload more than 100 employees across its operations in East Africa, though Kenya will bear the biggest shave. Mr Gitagama says the exercise will be carried out with utmost due respect to our employees and within the Kenyan laws. “We will strive to provide all the necessary support to help them manage the transition,” he said.
Moving to Mombasa Road
Nation Media Group operates print, broadcast and digital media outlets in Kenya, Uganda, Rwanda and Tanzania, with operations in print, broadcast and digital media.
The Coronavirus (COVID-19) pandemic has destabilized most businesses globally, including in Kenya. Many companies have either shutdown or substantially scaled down operations due to the drastic decline in revenues. The media industry in the country has severely been impacted.
NMG will be permanently adopting a work-at-home model implemented in March to ensure social distancing at the workplace, where a section of its workers have been working away from the office permanently.
Having some workers sacked and others working from home will reduce pressure on office space, allowing it to cut down on rent at the iconic Nation Centre, owned by its sister company Property Development Management (PDM). The board and management are considering moving the NMG offices from the city centre to its Mombasa Road printing press premises.
While a financially prudent move, working from home and away from the city centre comes with its share of challenges. Standard Group tried the out-of-town model but was forced to relocate back to the CBD after experiencing delays in getting to story subjects and press conferences. Working at home might spring coordination issues especially for reporters who are required to be ever mobile.
The media industry is keenly watching how the virtual office model will be implemented by NMG and which, indeed, it will cut cost and enhance its mobile transformation.
Nation Media Group
Media of Africa for Africa
To All Staff-NMG Kenya 1st July, 2020
I trust you are keeping well and staying safe while observing the Ministry of
Health protocols on prevention of COVID-19 pandemic.
In my last communication, | stated how the COVID-I9 pandemic has resulted in global uncertainty and unprecedented challenges impacting most businesses adversely. As you are aware, many companies have either shutdown, substantially scaled down operations or re-engineered themselves due to the drastic decline in revenues. Globally, the media sector has not been spared by the pandemic and media houses including NMG, having been severely impacted.
During this period, management has undertaken several cost-saving interventions to enable business continuity, ensure sustenance of livelihoods of staff and their dependents and continue delivery of services to our customers. However, despite taking these key actions, the business has continued bearing the brunt of the pandemic.
In view of the current adverse impact on business performance, the temporary salary reduction will be extended to 31 December 2020. This unavoidable action will be reviewed depending on the company’s performance and as the COVID-19 situation evolves. Individual letters will be sent to the affected employees.
Further, this new reality necessitates the re-engineering of NMG to accelerate the Group’s digital transformation. In this journey, the Group seeks to radically change its business model from print advertising and physical reader copy to digital advertising, ePaper subscription and content-driven reader revenue with the objective of establishing leadership in the mobile publishing landscape in Africa while exploring other new revenue streams in the experiential and technology space.
This will require re-tooling and resourcing the Group with relevant skill sets critical for success in the new business environment. Regrettably, this will result in a reduction of our workforce effective Friday, July 3, 2020.
It is an extremely difficult decision in view of the prevailing circumstances and we understand the impact this will have on those affected and their families. The exercise will be carried out with utmost respect to our affected colleagues and in adherence to the Kenyan labour laws. We will strive to provide the necessary support to help exiting staff manage this difficult transition.
We have made special arrangements for those affected to receive counselling support. Colleagues stationed outside of Nairobi who are affected will be offered relocation assistance. The affected staff will receive medical cover for a period of two months until August 31, 2020. Thereafter, the company has negotiated a medical insurance scheme through its current provider which those affected may opt to individually join.
Should you have any questions, please do not hesitate to speak with your line manager or contact Human Resources Department.
GROUP CHIEF EXECUTIVE OFFICER,
Nation Media Group