National Coordinator, Management Systems Consultants Association of Nigeria (MSCAN), Mazi COLEMAN OBASI tells CHIKODI OKEREOCHA why most Nigerian companies collapse after their founders’ demise among other issues.
Most Nigerian businesses hardly survive after the demise of their founders. What is responsible for this trend?
Most businesses of them do not put policies and procedures in place on how things should be done. And when you hear about creating or designing business processes and procedures it means that you are designing a process that will now drive the business beyond the human beings because initially the business was built around the human beings, but you should create a process that human beings will now drive. So, when you leave that seat today another person sees the document, use it and follow it; this is how this business unit is done; this is how this business is carried out etc. When you do that type of documentation what you are looking out for is purely improvement, as any other person who comes in joins and follows what has been done and he will be looking at how to improve on what is already in existence because there is a document. So, you find out that in most Nigerian businesses there are no documents, no procedures, and no policies; they don’t even hold meetings, what they call management meetings or departmental meetings. Also, some of the businesses collapse because some of the children of the original owners may not be interested in the type of business their fathers or mothers are doing. Others see themselves as outsiders and the business has no meaning to them; they don’t have shares; they don’t have any other thing they are benefiting apart from that salary. But if you employ me and give me the impression that look! If you help me grow this business to this level I will sell shares to you I now have interest to protect that business? That’s the mistake we are making. In some of the businesses, their family members who are interested have other ulterior motives particularly if it’s a polygamous arrangement. But what of families where the man did not marry many wives yet, their businesses collapse? I think it’s a matter of education to know how to run a business because entrepreneurship takes a lot. You need to read a lot, you need to learn, and you need a mentor and consultants to help you.
What about a situation where business owners send their children to schools overseas in the hope that they would come back and take over; isn’t it better they stayed at home and understudy their parents before taking over the business?
Experience is not something you acquire from school so, if you want to learn then you should start from where those missing gaps would be so that he can grow like a normal person in that organisation. Knowing that at the end of the day that top position is meant for him, but he should acquire experience through the ladder. In ISO quality management system what we describe as competence include education, knowledge, skill, and training. Somebody can be qualified for a job because he has been to school, but he is not competent, he doesn’t have experience and skill for that senior position. Experience is something you cannot fill if you don’t have it, somebody has to mentor you and show you how things are done.
To what extent does fear of ownership dilution contribute to the problem?
If somebody like Alhaji Aliko Dangote has been operating with that kind of mindset he will not be where he is today. Anybody who has grown his small business to a certain level and refuses to acknowledge that at this level he can no longer run the business alone, he needs to bring in professionals to help him run the business is shooting himself in the foot. At the end of the day if he is no longer there the business will collapse except he is lucky that his wife or somebody else can help. You cannot succeed alone no matter what you are; you must bring in people to assist you, competent hands, people who can buy into that vision. A lot of business owners also lack leadership qualities, anybody who has leadership qualities is not threatened or afraid of bringing people closer to him. But when you lack those things, you think that if you bring in people they will take the business from you. So, I advise any entrepreneur who wants to grow his business to a level to bring in competent hands. They don’t even send their staff for training. You need to continually train your staff. If you cannot send them to where they will pay higher fee, why not arrange in-house training for them. Some of them say if they train their staff they will run away and go and work in another place, and normally I will ask them what is your own social responsibility; these people you are employing they were trained by other people before you recruited them. That is one major problem of Nigerian businesses-they don’t like training except those of them who have been exposed to a level that they now know that training is the only way to improve the performance of staff. Training is an investment.
Is African culture that encourages polygamy also a factor? If so how does a business owner who has more than one wife guard against the collapse of the business after his demise?
First and foremost, Africans or Nigerians ought to have outgrown that; you don’t say because you have enormous resources it must end up helping you marrying as many wives as possible except you have a formula that these children or wives, after you are no longer there, can run the business effectively. Alternatively, if while you are alive, let each one of them tell you the kind of business he or she will like to run so that you can pay attention to your own business. Your own business you structure it in such a way that it can be run without you; what you need is leadership. I discovered over time that in most companies or business organisations the managers don’t see the managing director’s office as a department. The objectives of the business must be measurable whether you are meeting them or not on yearly, weekly, daily basis. Then you now create the necessary structures, which we call ordinarily, departments of that organisation and document why they were created, what they are doing, that is the nature of work they are doing, their key performance indicators and others so that whether it is your wife or son that occupies that office the first document he or she should be able to ask is what is commonly known as the standard operating procedure, which each department should have. That will become their guiding principle; they will use it, study it to do the job of the department, not his own job as a person, but job of the company; that is the process we are talking about, because you separate the human being from the job of the company so that whether he is there or not anybody he brings in will look at it and follow it.
Where does Will come in here, because some business owners either die intestate-without a Will or the Will was not properly done?
It’s a serious problem if they don’t have a Will. But I don’t want to think that Will include handing over a strategic business to a son or daughter. The Will should only talk about how to share your resources, not taking over the company. In most cases people who have successful businesses they put the business aside, they have their own resources, other properties they have apart from the business they have. But I don’t think Will should include willing the whole business organisation to someone. If they do that it’s okay, but I don’t advise anybody to do that because the business is a living entity; whether it is managed by a member of the family or not what we want is a successful business. If that has not been the case, organisations like Shell and Cadbury would have died long ago. The central point is that you don’t structure a business around one person, but around a business idea. Your business should not be structured around you, but around an idea because a business should outlive its owner.
