Akinsanya: SMEs  Face Myriad Challenges Impeding their Growth

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Aramide Akinsanya is an organisational development expert and Executive Director of LEAP Africa, a premium resource centre devoted to developing dynamic, innovative and principled leaders who will drive Africa’s realisation of its full potential. With a personal passion for driving change and providing solutions to issues that impact the larger society, in this interview with Olaseni Durojaiye, Akinsanya discusses entrepreneurial pursuits, SMEs and how to grow SMEs into large corporates

What are the founding vision of LEAP Africa?

The vision for LEAP Africa, which is what attracted me to the organisation was to be recognised as the premium resource centre for developing dynamic, innovative and principled leaders who will drive Africa’s realisation of its full potential.

 

How well placed is the Nigerian entrepreneur to complete in terms of global competitiveness?

I would say not yet, and that’s on a large scale. On smaller scale, there’re a few that are doing great stuffs, but may be having the visibility of big companies like a Glo and Dangote that are doing well even in other Africa countries; these are not SMEs we know, but we want our SMEs to get to that level and this is why we have this kind of programmes.

So I will say a large number of them are not yet in that stage where they can compete effectively in the African space. I think there are three African countries that are doing very well, that I could say are more prominent now within that space and that is Ghana, Kenya and of course South Africa. 

How could they compete? They are still battling with financing, innovation, unethical behaviours on the part of employees, culture, structure, a governance committee, financial planning and management.

 

Can you expatiate on the challenges impeding the Nigerian entrepreneurs and SME owners from being able to compete on the continental stage?

It brings us back to the ease of doing business in Nigeria. Every time I see a major business being established in a place like Ghana, I ask myself: what is Ghana doing right that Nigeria is not doing well? Why are so many Nigerian companies also taking off to Ghana to establish companies there? There are a lot happening in countries like Ghana, even Kenya in terms of innovation, in terms of financial inclusion, in terms of the use of technology, and of course South Africa; it means that we have a lot to learn from these African countries.

The SMEs face a lot of challenges in this part and I think a lot of them don’t even think about the things that can help them compete properly within Africa and globally because a lot of them are still battling with a lot of issues like power, access to foreign exchange and restrictions on certain raw materials; there is also the issue of ethical behaviour among staff.

There are also the issues of power restriction and dealing with unethical staff that has also become a pervasive mindset among the average Nigerian employee, who works for an SME and thinking of how he could copy the idea of the SME or probably snatch the company’s business, then go on to start his own business or he is using the company resources to his personal use.

 

What is the thinking behind LEAP Africa’s CEOs Forum and why is it focusing on SMEs?

Globally, SMEs are major employers of labour. They contribute significantly to the development of any nation by creating platforms whereby wealth can be created, due to the critical role that SMEs play in any nation or economy. But our focus is to help SMEs to position properly, to help them embrace organisational structure and attract funding so that they can also grow from SMEs into large corporates.

However, we have plans to expand our target to include Small Growth Businesses (SGB) and why I say that is because the LEAP focus in the SMEs is about helping organisations grow and become sustainable by embracing systems and structures; that being the case, I felt why not extend the benefits to SBGs since they are also strategic to the growth of any economy.

What does participants stands to gain from the CEOs?

There are so many benefits. Take for instance, the issue of innovation and technology which is one of the sub themes, you will agree with me that there is a lot going on out there that we cannot avoid the need to innovate. Technology is changing the way business is being done; it is changing the way everything is being done, and even in education people are doing phenomenal stuffs to demonstrate innovation. So as an organisation, whether you are business or as not-for-profit, if you are not able to adapt to the dynamism of your environment, you may become irrelevant or less relevant within your space and so you find out that you cannot ignore the need to be innovative.

For example, in our environment, we are very familiar with the authoritarian style of workplace leadership, but a lot of research that has broken down a lot of barriers in people management and emotional intelligence shows that there are ways of leading that create potential for direct report.

 

What are the benchmark expectations from the attendees after the forum?

If I may take you back to our mission which is to inspire, empower and to equip a new cadre of African leaders with the skills and tools for personal organisational and community transformation; so, we expect that as a result of being exposed to the international standard learning at the CEOs Forum, and the follow-up engagements afterwards, starting this year, we expect that: for those SMEs that have a strong key-man factor they’ll begin to ensure that processes are put in place so that people are empowered such that the reliance on the founder is reduced because we found out that for many organisations that have moved from being founder run to being run by management board are the better for it.

In LEAP, we talk a lot about corporate governance, it is part of the sub themes and we believe that is one of the challenges that is affecting organisations with the key-man factor; of course it can be avoided when you have a strong management board in place and since at LEAP issues of corporate governance is taken seriously, we expect that those that don’t have a board will put one in place.

In terms of financial management for instance; if an SME owner is at the point where there is no separation between personal finances and business finances, we expect that after the forum and the learning that they would have acquired they will clearly separate the two. If they didn’t have audited accounts before, we expect that they will start to have their accounts audited. After attending the seminars, we expect that going forward they would have their accounts audited regularly. This is so because the seminars that we have lined up in the CEOs Forum will make them realise the need to have audited  accounts and to take their civic responsibilities, as well as paying their taxes serious; and, ensuring that they run their businesses ethically.

We also expect that both the well-established business and the not-so-well-established ones will come to realise the importance of applying innovative methods into their daily operations, including leadership styles and how the work place should be in terms of culture.

 

What is the forum offering?

LEAP Africa is offering international standard training delivered by resource persons, who are experts, successful entrepreneurs and executives in well-structured organisations like large corporate and multinationals. We will be bringing in speakers who we know understand the issues that we know are lacking in a lot of SMEs. I think sometimes we take things for granted in our environment and so it’s an avenue for LEAP to contribute to sustainable growth of these businesses by saying that, you know what, you really cannot afford to take some things for granted anymore and this is an avenue where you can learn and engage with experts from not just within Nigeria, and learn. Starting from this year we will also be having post forum engagement, so the learning will be continuous.

 

There has been an upswing of activities around entrepreneurship recently. Why is this so?

This is a given because there are enormous data that shows that we do not have enough work spaces to take up the number of graduates that are being churned out by the tertiary institutions, and apart from the graduates, there are those, who are products of technical institutions as well; and so you ask yourself, what else will these young people do if they cannot get jobs.

Going into entrepreneurship seems to be the only alternative because you have to be able to create something that is marketable in products or service that will generate income for yourself and then income for others. I’m one of those people, who believe that every human being has immense creative potential, the major challenge that we face here is that we do not have an environment that really support creativity; that notwithstanding, we still have a lot of creative ideas.

Entrepreneurial development represents the way to actually execute one’s purpose, even though we have two kinds of entrepreneur: the dream chaser entrepreneur and the necessity entrepreneur. 

The necessity entrepreneur is just out to make money, he’ll do anything just to make money, and he could be into buying and selling. But the dream chaser has passion for something, he believes in a particular purpose; for him it is like a calling.

Another reason for the upsurge is that given the right support in terms of relevant international standard training, in terms of networking and the enabling environment, we can actually scale up and continually recruit more people and provide solutions that address problems that we face here.