5 REASONS NIGERIAN-OWNED BIG BUSINESSES HARDLY OUTLIVE THEIR FOUNDERS.
Apart from a few Pentecostal churches, it is very rare to find Nigerian-owned businesses that have outlived their founders and even expanded. In many western nations including South Africa, you’d find businesses that are over decades or centuries old and have grown and expanded beyond what their founders ever envisaged, unfortunately many of such businesses are not owned by ‘black’ people. Check out brands like Coca-cola, Disney, Ford motors, GE, Wal-Mart and even ShopRite, just to mention a few.
I grew up idolizing the late Chief MKO Abiola, I remember he had lots of business concerns such as Concord Newspapers, Berec Batteries and a host of others, and then he died. Everything vanished-with every investment probably squandered by his numerous wives, children and other relations.
As some one that has once worked in both large and medium scale Nigerian owned businesses, here are my observations or ‘opinion’ on why Nigerian-owned big businesses hardly outlive their founders.
1. FAMILY TIES: A lot of Nigerian-owned big businesses have found it very difficult to divorce themselves from the influences of the immediate and extended families of its founder. Once a Nigerian develops a successful business, his family members (many ‘habitual’ failures) begin to swarm round the business looking for their own piece of the pie without bringing anything new to the table. Brothers, sisters, cousins or nephews of the founder that are not qualified in any way begin to vie for positions in the company-and they often get it. Due to ‘cultural ties’, the founder finds it difficult in enforcing a system based purely on merit, lest his ‘people in the village’ accuse him of not wanting to help his brothers and sisters.
Mark Zuckerberg’s Facebook is worth over $100 billion, yet people don’t hear much or anything about his father, mother, brothers or sisters, if he was Nigerian...
2. GROOMING SUCCESSORS: Nigerian (and black African) business owners find it difficult to share the real secrets of their success to ‘outsiders’. Most times they just want to groom their own children to take over the business. But as it’s often the case, many children of Nigerian big business owners don’t necessarily possess the business acumen their parents have. Once the business is handed over to them upon the death of their parent(s), they run it down.
In more advanced societies, big business owners always have an eye out for people within the establishment, perhaps among his/her managers, that have rare leadership skills and are not necessarily blood relations. They keep these people close, make their stay in the company a comfortable one and begin a systematic grooming process- even the employee in question will not know that he or she is being groomed.
As for Nigerian owned businesses, once an ‘outsider’ employee starts to display strong leadership skills, both the owner, his family members and other ‘hangers on’ will feel threatened and start conspiring to put the ‘I too know’ employee in his place. They’d say things like, “Where were you (or your father) when we started building this company?”
3. DELEGATION: A lot of Nigerian business owners believe that they are the sole originators of all workable ideas for the business. Employees (especially junior ones) are not expected to ‘think’ but only to do ‘whatever oga says’. Most progressive ideas generated by ‘ordinary’ employees are subtly and sometimes openly frowned upon. This further makes it difficult for many Nigerian big business owners to create a system of delegation of duties from managers down to the lowest cadre of staff, giving them executive powers to initiate and execute far reaching decisions.
This is one of the reasons why you hardly find Nigerian-owned big businesses (except banks) running thousands of branches or outlets nationwide and worldwide.
4. TRIBALISM AND NEPOTISM: Will an IBETO GROUP ever allow a competent Yoruba man assume executive management of the business? Or will an Odua investment Company ever allow a competent Igbo man to lead it? Your guess is as good as mine.
5. PRIDE AND FEAR OF LOOSING CONTROL: In the life of a business, there could be periods when a company becomes too successful, too stagnant or too complex even for its founder to effectively manage. In advanced nations, whenever business owners face these types of challenges they quickly start scouting for new deals, mergers or bigger partnerships that may even include buy-outs. In such deals, the founder may even loose executive control of the business to a larger board where he becomes an ordinary board member with certain privileges. Business owners take such decisions in order to ensure the long-term survival of their business or brand.
In Nigeria, a business owner faced with such challenges would never consider engaging in such partnerships with bigger entities, talk less of stepping down as CEO. They’ll keep saying to themselves. “I've suffered hard to build this business, what will my children inherit?” Many will decide to weather the storm and with all the points laid out earlier in this article playing out, the business dies a natural death –sometimes during the life time of its founder.
CONCLUSION: As an aspiring 'big' business owner myself, I cannot guarantee that I too will not be plagued by some or most of the points highlighted above. But I’ll sure as hell TRY not to.