To achieve sustainable growth of business, experts have called for the use of suitably qualified external consultants to boost limited in-house capacity and expertise needed to carry out a thorough business transformation.
Specifically, the Partner, Executive Edge Limited, Lagos, Dr. Okechukwu Mbonu, a former managing director of Sierra Leone Brewery Limited, made the call at a lecture, entitled, “Sustainability of family owned conglomerates in Nigeria,” organised by the Nigerian Academy of Engineering (NAE) as part of events to mark its 2019 technology dinner. He maintained that most family-owned Nigerian conglomerates are peculiar given the absence of in-house capacity for success and succession leading to their untimely death.
This, he observed could be turned around through the deployment of qualified external consultants, who would determine the most practical transformation roadmap to adopt in rejigging businesses that are not performing optimally.
Mbonu said family businesses have the potential to serve as catalysts for direct creation of wealth, and reduction of poverty, provide competition for better services, technical innovation, and enhanced local tax income. However, their procedures and processes remain pedestrian in terms of strategic planning, and corporate performance management, internal business control, human resource management policies, and management of information and communication.
“The entire business simply revolves around the sole proprietor, and business activities will usually falter or collapse completely during the absence or demise of the sole proprietors. Some external barriers like lack of long-term financing, severe national security challenges, poor infrastructure, multiple taxes, policy inconsistencies, and lack of adequate local technical and management expertise, hinder long-term sustainability of family-owned conglomerates”.
Mbonu argued that with the assistance of competent and experienced external management consultants, a transformation journey that would involve strategic tax and financial optimisation, structure and human resource review, sales review, corporate governance review, and getting listed as a publicly quoted company in the capital market, could be enforced as necessary enterprise steps for sustainability.
“The sequence and mode of application of the transformation steps will depend on the nature of business and level of maturity of the family owned business Nigerian conglomerate. In some cases, it may also be necessary for the target family business to recruit qualified personnel to fill newly-created key positions,” he said.
In his remarks, NAE President, Prof. Fola Lasisi, said the idea of educating members on how to sustain family businesses became necessary following sorry stories of how many of such businesses collapsed in Nigeria, due to lack of solid plan for growth that outlives generations.
“We are determined to continue the tradition of information dissemination and exchange of ideas among ourselves and other professionals, act as advisers to both the government and private sector operators on engineering, technology, and other related matters. The goal remains the significant improvement of the lives of the people and the society,” Lasisi assured.
