Earlier today, I attended GNAM (Global Network for Advanced Management) Program tagged “Unlocking Africa’s Business Growth Potentials”. Mr. Tony O. Elumelu was invited to speak on the topic. Mr. Elumelu is the Chairman of the United Bank for Africa (UBA), Chairman of Heirs Holding, Transcorp, and the Tony Elumelu Foundation.
Mr. Elumelu started by asking, what is a talent without opportunity? What is ambition without a platform? You can be driven, but there is a limit to what you can do on your own. He defined his “Afri-capitalism” philosophy as a call for Africans to play a collective role by building platforms for harnessing the vast business opportunities in Africa.
We, the Africans hold the key to unlocking development by creating products that address myriad problems in the continent. This is because Africa belongs to us, and no one can understand our terrain better than us.
We must get rid of the entitlement mentality. We cannot continue to look outside Africa for financial aid and grants. India and Singapore were also colonized, but their economies have developed rapidly since colonialization ended. According to the Economist, India is projected to become the biggest economy in twenty years.
How can we Achieve Development in Africa?
First, we must prioritize the need of young people by listening to their needs. Invest in quality education, talent development, mentoring, and funding. Beyond capital, entrepreneurs require support and accountability to grow.
Enabling environments such as electricity, health care, transportation, and security are critical platforms for businesses to thrive. Whilst the Government is responsible for easing the business environment, individuals and private organizations have an important role to play.
Holding each other accountable is an important critical success factor. Citizens and governments need to hold each other accountable. Keeping quiet and ignoring wrongdoing could hinder development.
What are the Most Significant Challenges of Expanding in Africa?
Responding to this question, Mr. Elumelu narrated the expansion story of UBA. UBA is one of the most resilient banks in Nigeria with operations in twenty African countries. In 2007, UBA created a three-tier strategic intent which was:
- Become the leading financial institution in Nigeria.
- To become the leading Pan-African financial services group
- Have a global footprint in global centers around the world.
Having operated in Nigeria successfully for so many years, they thought it was time to expand to other African countries. Their first Pan-African expansion was Ghana, here are some lessons from their experience.
Map and Engage Stakeholders
Before applying for a banking license, the bank commenced stakeholder engagement by visiting the President of Ghana, and other key Government officers to discuss the bank’s vision. They ensured to explain the social and economic impact UBA’s investment in Ghana would create. They proceeded to apply for the license after having successful engagements with the stakeholders.
Have a Long-Term Orientation
Being too focused on the short term can be detrimental to growth. He explained that during the first six years of business, UBA’s subsidiary operating in Ghana recorded losses. Because of the group’s long-term view, the subsidiary was not placed on profit pressures until operations stabilized. After 6 years, the company gathered momentum and returned profits as a result of sound statutory, operational, and governance excellence established in the early years.
Integrate and localize your business
Business leaders need to understand the local environment they are expanding to. Engage with the local people and understand their culture. Intentionally include various elements of their culture in your business practices, this will endear you to the people and create a strong sense of belonging.
Create Relationships
Connect with people and create relationships. People do business with people they know, like, and trust the people.
Dealing with Human Capital Challenge
Businesses rely on people, processes, and technology to succeed. As you prepare to expand, you must create sound processes and deploy scalable technologies. Sound processes and technology can ease the human capital challenges that come with expanding your business to new territories. In the case of UBA, the company established an academy to train and develop the capacity of the workforce.
#MMBA11 #AFRICAPITALISM
