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Paradigm of Changing Business Environment

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business in nigeria

By Oremade Oyedeji

Recently, at an event organized by one of the top three banks in Nigeria held at a stadium in Lagos, after burning some calories, my wife invited me to meet one of the top executive directors; simply call him Yemi (not real name).

This dude is, however, not one to brook any nonsense from any quarters. He is blessed with this unique feature that decorates a man with the title of gentleman. He is a chartered account and a former MD of a Nigerian bank in the diaspora, where I believe his employer poached him from.

I have been an auditor/accountant myself and in fact, auditing financial institutions, including one of the Big Four in the country.

During one of our usual routine audits, one of my senior managers had then predicted that “Yemi will become a bank Chairman.” In his opinion, the banking system had better identify such a powerful talent and make use of him as a tool in building a world class Nigerian bank. So, for me, it should be humbling to have a conversation with him. I quickly threw some questions at him.

Me: I saw your profile on the internet.

Yemi: “Ha ha ha,” he laughed, saying, “that profile is just big, this is just the small me you are meeting here.”

I couldn’t hold back myself (in my mind). I didn’t intend to dazzle the mighty. Ay, anyways, I have got his attention.

Only an Accountant has the capacity to do great things really. Every great leader has great expectations from his followers.

The paradigm shift in the business world is fast and many things are changing, but what exactly is changing?

The banking industry in Nigeria, for example, in the last decade, has gone through several transitions, alongside the change from Financial Standards to IFRS. Why did Nigeria adopt the IFRS as against the SAS (The Nigerian Accounting Standard)? What does Nigeria stand to gain by adopting a foreign standard over its own standard, or why do regulators keep changing the capital requirement for banks, same as the insurance sector?

I personally had an experience with a panel of interviewers at one of the quoted mortgage banks with a premier status, where I politely explained to my interviewers what change in the standard means, relative to what the different quarters perceived it to mean. One of the panellists (an aged management staff) was so physically upset that he didn’t fail to express it.

Meanwhile, the executive director present at this function was so impressed that in the middle of the hot debate, pronounced that “you are hired for the Head of ‘so, so’ Department.”

Business is a war manoeuvre for promotion, battle for market, mergers and takeovers, campaign to upgrade productivity and customer service are a conducted by men whose energy come from a strong desire to win.

Indeed, education makes people easy to lead, difficult to drive; easy to govern, but difficult to enslave. The corporate environment and business place are generally changing.

We can point to several regulatory examples of changes for banks, insurance or even oil & gas, but the big question is still, ‘what exactly is changing?’

Denis Waitley, in his book, Empires of Mind, pointed to the fact that what worked yesterday may not work today.

Yesterday, natural resources defined power. Today, knowledge is power.

Yesterday, hierarchy was the model. Today, synergy is the mandate.

Yesterday, leaders commanded and controlled. Today, leaders empower and coach.

Yesterday, leaders were warriors. Today, leaders are facilitators.

Yesterday, leaders demand respect. Today, leaders encourage self-respect.

Yesterday, shareholder came first. Today, customers come first.

Yesterday, managers directed. Today, managers delegate.

Yesterday, supervisor flourished. Today, supervisors vanish.

Yesterday, employees took orders. Today, teams make decisions

Yesterday, seniority signified status. Today, creative drives process

Yesterday, productions determine availability. Today, quality determines demand.

Yesterday, a value was extra. Today, value is everything.

Yesterday, everyone was competitor. Today, everyone is a customer

Yesterday, profits were earned through expediency. Today, profits are earned with integrity.

Alvin Toffer, author of Powershift, also predicted that, with knowledge now the key raw material for creating all economic wealth, the new power struggles would reach deep into our mind and our personal lives. I personally believe that the only empire that will survive in the 21st century will be the empire you build within your mind.

According to Waitley, there’s a new power train on the information superhighway; admonishing that if you run a business, lead a team, or are otherwise trying to remain competitive in the changing world, you will be stranded if you miss it.

He averred that global competition is powered by information access. Information access is powered by technology. Technology is powered by capital investment. Capital investment is powered by profit.

Profits power revenues. Revenues are powered by volume and repeated sales. Volume and repeated sales are powered by customer loyalty, customer loyalty is powered by customers satisfaction.

Customer satisfaction is powered by value. Value is powered by employee productivity. Employee productivity is powered by employee loyalty. Employee loyalty is powered by management stewardship. Management stewardship is powered by invisible leadership and invisible leadership is exercising the vision to change the traditional role from commander to coach, from manager to mentor, from director to delegator, from one who demands respect to one who facilitates self-respect.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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The Deplorable State of St Charles College Abavo Delta State

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St Charles College

By Jerome-Mario Chijioke Utomi

The barrage of reactions and commentaries that trailed the recently published disturbing pictures that drew the attention of the Delta State government to the visibly distressed structures, dilapidated classrooms with fallen ceilings, windows and doors at Oyoko Primary School, Abavo, Ika South Local Government Area of the state has again given credibility to the belief that a free press is not a privilege but an organic necessity in a great society.

For without reliable and intelligent reporting, the government cannot govern. For there is no adequate way in which it can keep itself informed about what the people of the country are thinking, doing and needing.

Despite this new awareness, what has, however, caused concern among Deltans with critical interest as well as qualifies the development in the state’s education sector as a crisis is a fact that before the dust raised by the ‘deplorable, inhuman and gory account of Oyoko school condition could settle, another was up. This time, it has to do with an eyewitness account of the poor state of a secondary school in Abavo town, St Charles College.

For clarity, St Charles College, he said, was originally built, owned and operated by the Catholic mission in the state. The school has to its credit produced prominent citizens of Ika nation extraction and Nigeria as a whole. Also remarkable is the fact that the college was at a time the only secondary school within the Abavo clan that could boast of boarding facilities. Those were the good old days.

St Charles College Abavo

The school, like other missionary schools in the state, was seized by the state government, mismanaged, starved of funds, stripped of learning convenience, ‘killed’ and the carcass finally returned to the original owners by the administration of Dr Emmanuel Uduaghan without any form of financial mitigation or infrastructural remediation.

The commentator noted with nostalgia that ever since the government led its cold hands on St. Charles, the centre can no longer hold and things fall apart.

Even the new owner (the mission) is currently in search of the courage needed to tackle the degree of infrastructural decay in the school. The once celebrated hostel facility that previously housed students who are today not just prominent but great men in society is presently without a roof, lying lonely, fallow and deserted. The same fate befell the school laboratory building until recently when the old boys of the school took it upon themselves and had the laboratory building roofed. But even with that feat, the science laboratory cannot boast of a single test tube.

This state of affairs, he lamented, is in sharp contrast with the Anambra State experience under Governor Peter Obi’s administration who funded and equipped the schools with state-of-the-art ICT learning facilities, and provided school buses before he seamlessly handed over the school to the missions.

As the author, what is undeniably my concern, in addition to the above awareness, is not the commentator’s admission that the decay in the majority of schools (primary and secondary alike) did not start with the present administration, rather, it is his declaration that if the level of decay in previous administrations were considered a challenge, what is happening presently should be characterized as a crisis.

St Charles College Abavo1

To further consolidate his position, he said; Governor Okowa’s mother is from the Abavo community. For that reason, if the Governor could abandon projects and neglect schools in the community where his mother hails from, that will give an insight to what is happening in other parts of the state.

In May 2015, he added, Governor Ifeanyi Okowa assumed office without doing anything substantial to save these financially emasculated schools returned to the missionaries or serve the people; forgetting that governance is a continuum. The Governor at the beginning of this year (2022) promised these mission schools some money, but such promises like many others have gone with political winds. We are particularly unhappy that Governor Okowa abandoned his people, he concluded.

Let’s assume the state government ignored St. Charles because it has been handed over to the mission and is now not directly under the preview of the government. It will again necessitate the question of how well has the government treated its own secondary schools under its watch?

To answer this perennial question, the findings of this study/research along with collaboration from many other investigations using different procedures suggest that both government secondary schools and the recently handed over mission schools share ‘equal sorrows’, virtues and attributes.

The similarity in structural deficiencies is a common denominator.

St Charles College Abavo2

Take, as an illustration, St Anthony College, Ubulu-Uku, Aniocha South Local Government Area of the state is a wholly owned government model school. But there is nothing model or modern about the school. The classes are far from being 21st-century learning environment compliant. The few new structures found in the school are attributable to the personal efforts of good-spirited individuals and the school’s old boys association.

The school hostel previously reputed for housing over 300 students is now a show of itself- infested with rodents and reptiles-these dangerous animals jostle for space with students. The environment is laced with dilapidated structures, falling windows and surrounded overgrown bushes. Even the promises made by the Secretary to the State Government (SSG) have not appreciably changed St. Anthony College’s misfortune or changed their narratives, he concluded.

Certainly, there is, in my view, a reason to believe that these commentators may not be alone in this line of belief.

For instance, Ika Weekly Newspaper, a well-respected community newspaper based in Agbor, Ika South Local Government Area of the state, in its recent editorial comment entitled Calling on Gov. Okowa to Address the Sorry State of Oyoko Primary Schools Abavo, Ika South Local Government Area of Delta State, among other concerns stated that, “no learning takes place in such an environment. Yes, the students may gather at that point called Oyoko Primary School but we hold the opinion that evidence on the ground cannot qualify or ascribe such an environment as conducive for learning. More pathetically, that such a ‘learning environment’ still exists in the state and in the community where the Governor’s mother hails from, is a painful experience.”

Definitely, in my view, there is a funding challenge in the education sector not just in the state but the nation as a whole. Notwithstanding, this piece believes that in many ways, the present administration in the state may have a sincere desire to move the nation forward, but there are two militating factors. First, there is no clear definition of the problem as it concerns the education sector, the goals to be achieved, or the means chosen to address the problems. Secondly, this is the only possible explanation for this situation.

As an incentive to solve this lingering challenge, the state must depart from the cosmetic approach and get involved with more work and make more reforms. They must look for ways to develop/implement plans and policies that will lead to proper funding of the education sector in the state as any development plan without access to quality education is a sheer waste of time.

Also, drawing a lesson from the Anambra State experience under Peter Obi’s administration will be considered a right step taken in the right direction.

This piece holds the opinion that the state government needs to do this not for political reason(s) but for the survival of our democracy and the future of our children.

Utomi Jerome-Mario is the Programme Coordinator (Media and Public Policy), Social and Economic Justice Advocacy (SEJA), a Lagos-based Non-Governmental Organization (NGO). He can be reached via Jeromeutomi@yahoo.com/08032725374

St Charles College Abavo3

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Managing Rising Inflation in Nigeria

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inflation in Nigeria

By Otori Emmanuel

No doubt, inflation is a barrier to the much a country can do in terms of value and wealth creation as it affects every aspect of its productivity. Tragically, this is currently the state of Nigeria where the purchasing power of the Naira declines day by day. This decline is not without effect on daily living – everything increases as the purchasing power decreases.

The Consumer Price Index (CPI) annual percentage change in value is known as inflation. It accurately gauges how much a portfolio of goods and services prices vary over the course of a year. The CPI for 2022 increased to 15.60 per cent (year-on-year) in January 2022, according to records from the National Bureau of Statistics (NBS). Based on the NBS, Nigeria’s inflation rate increased from 9.0 per cent in 2015 to 17.71 per cent as of May 2022 (year on year).

It is obvious that over the years, the value of money in Nigeria has been falling, thereby causing a negative impact. Usually, this inflation is expected to reduce purchasing power by 2 per cent or 3 per cent to bounce back to stability but it seems that the inflation in Nigeria has risen above 10 per cent.

In a state like this, Nigeria is gradually tilting into hyper-inflation, thereby reducing the value of the Naira. Over the past 10 years, Nigeria has long struggled with a general increase in the cost of food, goods, and other necessities as well as a decline in buying power which has barely retraced the market.

Inflation rates of 2 per cent to 3 per cent assist an economy because they stimulate consumers to take out more loans and make more expenditures because interest rates are also held at historically low levels at these levels.

How is Inflation caused?

Inflation is brought on by the following among others:

  • Changes in the cost of production and distribution.
  • An imbalance in the money supply and demand.
  • An increase in the tax rate on goods.

As it is known, the value of money decreases when the economy undergoes inflation, which is an increase in the price of goods and services as a result, a given unit of currency now buys fewer products and services.

Implications of Inflation

According to data from the NBS, the economy made an improvement in 2022’s first quarter, as evidenced by a 3.1 per cent growth in Gross Domestic Product (GDP). Both individuals and the nation as a whole are impacted by this high inflation.

The effects on consumers are the harshest – people can no longer maintain a budget since their income is so low. Consumers find it challenging to purchase even the necessities of life due to the high cost of everyday goods. They are forced to request higher pay as a result, which gives them no choice.

Inflation Control

In order to manage inflation, the government and the central bank typically regulate the economy through monetary and fiscal policies. Monetary policy is the principal strategy employed (interest rate fluctuation). However, inflation can be controlled with the following measures:

  • Monetary policy – Reduced economic growth and lesser inflation are the results of lower demand due to higher interest rates. Interest rates can be raised by the central bank in reaction to inflation. Borrowing becomes more expensive and saving becomes more appealing at higher interest rates. Residents will have to make higher lease payments, which would leave them with less money to spend. Consequently, households will be less able and less motivated to spend. Businesses will invest less because corporations won’t be as likely to borrow to finance investments. Therefore, increased interest rates have a significant impact on slowing down investment and consumer expenditure, which results in a slower economic growth rate – inflation also slows down as economic development does.
  • Money supply control – According to monetarists, there is a direct correlation between the money supply and inflation, hence reducing the money supply can indirectly reduce inflation. Reducing inflation should be possible if the expansion of the money supply can be managed. Measures advised by the monetary school of thought include; budget deficit reduction (deflationary fiscal policy), elevated interest rates (contracting monetary policy) and the government’s ability to control the currency type and quantity it issues.
  • Supply-side fiscal policies – Initiatives to make the economy more efficient and competitive, which will drive down long-term expenses as inflation is frequently brought on by ongoing cost increases and weak competition. The economy may become more competitive and inflationary pressures may be reduced with the aid of supply-side policies. For instance, more accommodating labour markets, industries and production activities might help ease the strain on inflation. However, supply-side initiatives may take some time to implement in Nigeria due to the time required for construction and setting up manufacturing operations. In the meantime, this is likely ineffectual against inflation caused by growing demand.
  • Fiscal policy on tax increment – Increased income taxes may have a moderating effect on demand, spending, and rising inflation. Taxes (such as VAT and income tax) can be raised thus decreasing spending by the government to lower inflation. Lowering demand in the economy serves to improve the government’s budget condition. These two measures both slow the expansion of the overall demand, which lowers inflation. Also, reduced Aggregate Demand (AD) growth can lower inflationary pressures without triggering a recession if economic growth is fast.
  • Wages and price control – Theoretically, attempting to restrict wages and prices could assist in lowering inflationary pressures. However, because they are mostly ineffective, they are not frequently employed. Limiting wage growth can aid in containing inflation if wage inflation (produced, for example, by strong unions negotiating for higher real wages) is the primary cause of inflation. Lessening wage growth will lower business expenses and result in a decline in the economy’s excess demand. However, it can be challenging to control inflation through income programs, especially if the unions are strong. Furthermore, pay regulation calls for broad economic cooperation, but businesses that are experiencing a labour shortage will be more motivated to hire staff, even if it means going above and beyond government salary limits.
  • Global investment and exportation – Nigeria investing in remunerative products such as oil investment can help manage inflation less importation and increased exportation can give the Naira a worthy valuable. Nigeria becoming a producer nation should not be overlooked as currently, the least of items are even imported. Exchange rates and other importation policies contribute to decreasing the purchasing power of consumers. As interest rates rise, the value of currencies should rise as well (higher interest rate attracts hot money flows) Inflationary pressure will also be lessened by the exchange rate appreciation through lower cost of imports. As a result of the decreased demand for exports and resulting lower overall demand in the economy, the price of imported commodities (such as gasoline and raw materials) would fall. Since exports become less competitive than domestic markets, exporting businesses will be motivated to reduce expenses and raise competitiveness over time. By affiliating with a fixed exchange rate system, a nation may aim to keep inflation low. According to the reasoning, keeping inflation under control requires discipline, which can only be achieved if a currency’s value is fixed (or semi-fixed). The currency would start to decline if inflation increased because it would lose its appeal.
  • Demonetization and reissuance of money – Conventional policies might not be suitable during a hyperinflationary environment. It can be difficult to alter future inflation expectations. It could be necessary to adopt a new currency or utilize another one, like the dollar, when people have lost faith in a certain currency as in the case of Zimbabwe. The issue of replacing the existing currency with a new one is the most extreme monetary measure. A fresh note is substituted for numerous old notes of money in this manner. The valuation of deposit accounts is also determined in this manner. A measure like this is implemented when there is an excessive amount of note issuance and hyperinflation takes place in the area. This measure has had great success. When a nation has an abundance of illicit currency, this action is frequently taken.
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Forgotten Pacesetters and Faulty Leadership Recruitment

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Leadership

By Jerome-Mario Chijioke Utomi

At a very recent function in Lagos, a participant placed this question before the gathering; what exacerbates Nigeria’s current political and socioeconomic challenges? And just immediately, he got two separate but related responses from two personalities I consider well-informed, self-contained and quietly influential Nigerians.

The first stated thus; the situation (poor leadership) in the country is not party, tribe/ethnic, religion, state governors or federal government insulted. Rather, it is a ‘total national leadership collapse in the country from ‘top to bottom’. It is a brazen manifestation of a bunch that is yet to internalize the fact that power is nothing but the ability to achieve the purpose-a and strength required to bring about social, economic, political, cultural and religious changes.

The second captured his response this way; not that the nation’s leadership is lacking in vision but their vision more often than not is not masses-centred. Even those that could qualify as people purposed are in most cases stripped of clear definition, the goals to be achieved, or the means chosen to address the problems and to achieve the goals and making the entire narrative a crisis is that the system has virtually no consideration for connecting the poor with good means of livelihood-food, job, and security.

This is the only possible explanation for the situation and will continue until the present crop of leaders productively looks back to draw both inspiration and lessons from the nation’s forgotten pacesetters and forbearers such as Pa Obafemi Awolowo, the late premier of the western region of Nigeria; Dr Nnamdi Azikiwe and Ahmadu Bello of Eastern and Northern regions respectively; Pa Michael Ajasin of old Ondo State and Ambrose Folorunsho Alli, the one-time Governor of the now defunct Bendel State, he concluded.

Indeed, to any student of history, these facts should not be a surprise.

Maybe I am missing something here but from the above admonition, this piece believed and still believes that what today’s leaders need is to study these departed pacesetters, nationalists and nation builders, to study their history, study the actions of these eminent men, to see how they conducted themselves and to discover the reasons for their victories or their defeats so that they can avoid the later and imitate the former’.

Aside from assisting the nation not to wander in dilemma, the above action is important as ‘knowledge will forever govern ignorance. And people who want to be their own governors must arm themselves with the power that knowledge gives.’

Take, as an example, as documented in his Path to Nigerian Freedom (1947), Pa Awo drew the first systematic federalist manifesto. He advocated federalism as the only basis for equitable national integration and, as head of the Action Group he led demands for a federal constitution, which was introduced in the 1954 Lyttleton Constitution, following primarily the model proposed by the Western Region delegation led by him.

As the premier, he proved to be and was viewed as a man of vision and a dynamic administrator. He was also the country’s leading social democratic politician. He supported limited public ownership and limited central planning in government.

He believed that the state should channel Nigeria’s resources into education and state-led infrastructural development. Controversially, and at considerable expense, he introduced free primary education for all and free health care for children in the Western Region, established the first television service in Africa in 1959, and the Oduduwa Group, all of which were financed from the highly lucrative cocoa industry which was the mainstay of the regional economy.

Under his leadership, nobody needed to fly to Canada or the UK to go and look for an education. It was here.  People from Canada were doing Commonwealth exchange; coming from Canada to go and study at the University of Ife. If you want to go out, it was just for the fun of it not because the education here was inferior to what you are going to get outside.

Awo, Chief Michael Adekunle Ajasin, former Governor of old Ondo State, whom many describe as the moving spirit of the Free Education Programme of the defunct Western Region, and Ambrose Folorunsho Alli (22 September 1929 – 22 September 1989), the first civilian governor of the old Bendel State, shone like a billion star in the areas of education, infrastructural provision and nation building. They shared similar but interesting attributes worth emulating by Nigeria’s current crops of leaders.

Ambrose Alli, for example, was a member of the constituent assembly that drafted the 1978 Nigeria constitution. He joined the Unity Party of Nigeria (UPN) and ran successfully as a UPN candidate in the Bendel State governorship election of 1979 and won the election. He founded Bendel State University now Ambrose Alli University, Ekpoma. Many campuses in Ekpoma, Abraka and Asaba were established during his tenure. However, with the creation of Delta State by the administration of Gen. Babangida, the university became two universities, namely Delta State University, Abraka and Ambrose Alli University, Ekpoma, posthumously named after him.

He brought massive development to Bendel in different sectors, from the establishment of numerous post-primary schools and tertiary institutions to the massive construction of roads and housing. His main thrust as governor was to increase educational opportunities. He established over 600 new secondary schools and abolished secondary school fees.

Apart from the establishment of the university, he also established various Colleges of Education in Ekiadolor near Benin City, Agbor, Warri, Ozoro, and three Polytechnics, with a College of Agriculture and Fishery proposed for Agenebode.

He also established four teacher training colleges to supply staff to the new schools, as well as several other higher educational institutions. Other reforms included abolishing charges for services and drugs at state-owned hospitals and eliminating the flat-rate tax.

His administration carried out massive construction of roads to open up the rural areas. In the housing sector, he built low-cost housing estates in Ugbowo, Ikpoba Hill in Benin City, and Bendel Estates in Warri. As Governor, he always wore sandals, joking that he was so busy working in Government House that he never had time to buy shoes for himself. When Ambrose Alli left office in 1983, he retired to his family house.

Aside from the above account, we are equally witnesses to the fact that in the Midwest and Bendel State of old, there existed government-owned companies established by the then leaders. They were established to among other aims create employment while bringing revenue to government coffers.

Examples of such companies include but are not limited to MidWest Lines, Bendel Hotel, Bendel Insurance, and Bendel Glass, among others.

That was in the good old days.

Therefore, as the nation braces up for the 2023 general elections, there is no doubt that presently, Nigeria is at a leadership crossroad and there is a wise saying that “if you do not know the direction you are headed, then, get to the crossroad and you will find the way to your destination’. Nigerians should take hope in the fact that a cross-road is a place of decision, difficult decisions.

Again, ‘it is sometimes convenient to forget. At others, it is uncomfortable to remember. To forget is perhaps one of the greatest gifts of nature. But to remember can also be an invaluable asset sometimes”. It is, therefore, the opinion of this piece that come 2023, Nigerians will not forget the present crossroad. But even if as humans they forget, history will be there to remind them.

Utomi Jerome-Mario is the Programme Coordinator (Media and Public Policy), Social and Economic Justice Advocacy (SEJA), a Lagos-based Non-Governmental Organization (NGO). He can be reached via Jeromeutomi@yahoo.com/08032725374

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