Experienced entrepreneurs and company managers have enumerated steps business owners must follow if they want their businesses to go beyond the first generation.
According to them, successful entrepreneurs must deliberately and systematically groom their successors and ensure that they (the successors) understand the operational environment.
Olusoji Majekodunmi, former company secretary, UAC plc and past president of Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN), said one of the factors that kill business succession is the penchant to train successors in a different economic and political environment and expect them to assume the position of managing director once they are back.
According to Majekodunmi, there is also absence of efficient planning among business owners, which makes succession difficult.
“One of the problems faced by family businesses is the lack, in most cases, of a deliberate and systematic plan in the transfer of the ownership of the business from one family to the next, thereby leading to the death of the business after the original founder is gone,” he said at the public lecture commemorating the 40th anniversary of S.E Nomuoja &Co., held last Friday in Ikeja, Lagos.
“Again, experience has shown that in most businesses, the frugality of the founder is replaced with profligacy, with successor siblings shovelling out monies raked in by the founder,” he said.
He pointed out that the non-transferability of integrity from the original owner to the successor is one key reason why many business owners do not like revealing certain secrets to their successors
“Culturally, assuming that a man who has the power to disappear transfers this to a successor who has a criminal tendency, do you not think that this successor can decide to pull himself into a bank where he will take all the people’s money?” he asked, rhetorically.
“This is about integrity. Again, there is also the problem of ‘qualified but not suitable’. Many people have paper qualifications but cannot put what they claim to have into practice,” he explained.
He said that late S.E Nomuoja deliberately and systematically trained four of his children to succeed him as chartered secretaries, urging the young generation to emulate this.
Benedicta Ovoke Sadare, daughter of late S.E Nomuoja and managing partner of S.E. Nomuoja &Co, said the firm is the first indigenous firm of chartered secretaries and administrators in the country.
According to Sadare, an entrepreneur is expected to establish a clear and meaningful strategic development process for easy succession with a view to sustaining the business, adding that the firm is ready for partnership with interested organisations and will strive to exist in the next forty years.
Businesses such as UAC, Unilever, Quaker Oat Company, among others, have lasted beyond one generation. Nigerian businesses hardly outlast their founders owing to attitudinal, political and environmental challenges.
Ayinla Olatunde Abudu, chairman of the occasion and lawyer, said efficient management, as demonstrated by late S.E Nomuoja, is one factor that can make a business last for several generations.
- Dangote Commissions $250 Million Cement Factory In Cameroun
- How Nigerian Entrepreneurs Can Benefit From Lifting Of Iran Sanction