BY OLUFEMI ADEDAMOLA OYEDELE
Olufemi Adedamola Oyedele, MPhil. Construction Management, managing director/CEO, Fame Oyster & Co. Nigeria, is an expert in real estate investment, a registered estate surveyor and valuer, and an experienced construction project manager. He can be reached on +2348137564200 (text only) or email@example.com
Business organisations are prone to ‘competitive rivalry’ and have a high tendency of winding up when they are not ‘positioned-for-success’. A good business manager must always put on his or her thinking cap as ‘opportunistic-competitors’ are ‘watching over’ to choke up the business. Businesses which do not have competitors are monopolies, technically difficult-to-establish and with complex business processes.
Some businesses are not easily established because of patents, law, input and huge equity. Some have manufacturing processes and or methodologies which are not easy to imitate. Even with laws streamlining the establishment of some businesses, for example, that hospitals must have medical practitioners as head, some crooks still go ahead to establish these businesses. We have more table-water brands in Nigeria than the rest of Africa combined!
Positioning business organisations for success is more of a planning function than finance or operation. In development projects, four factors are usually considered and the absence of any of these four factors will make nonsense of the development exercises. These factors are: design, finance, technology or methodology and management. No development is possible without a design or concept in place. Development basically follows the dream/design of the developer. It is after the dream has been dreamt or the concept has been conceptualised and designed that we can talk of the financing method. After we have secured the finance or sure of fund, we can then talk of the process or methodology of developing our design, including the technology to be used. The fourth, but not the least, factor to be considered is the management method. We must think of the maintenance and sustainability of our development as a business continuity strategy.
Businesses are established for profit-making despite the myriad of risks and its resemblance to a toddler that must crawl, walk before running and compete in track and field races. All businesses have their teething problems! But recognition of teething problems as different from ‘terminal diseases’ in these businesses will make them ‘emerge’. The interplay of leadership, good corporate governance, type of business, capital base, business environment, quality of customers and marketing mix will determine the turnovers and margins of businesses.
Marketing mix is the set of actions, or ploys, or strategies, or tactics, or system, which a business organisation uses to promote its organisation, brand, product or service in the marketplace. For business positioning and sustainability, businesses must adopt a ‘marketing mix’. Corporate organisations must consider the 8Ps of business or the 8Ps of marketing. All businesses are about marketing. They are either marketing products or services or both.
The 8Ps represent the product, price, place, people, promotion, processes, positioning and performance. Any business-manager that can have all the 8Ps working in synergy will spontaneously take his or her business to the next level. Businesses are about unique or quality product or service or output; competitive price which are determined by costing; place, location or business environment; people, customers or stakeholders without which there is no need for business activities; promotion or awareness-creation of the product/s and or service/s of the business; processes or methodologies which in modern businesses rely on technology; positioning is about niche creation, it defines where a product or service stands in relation to other similar products or services in a business environment; and performance – feat of the organisations. It is suicidal for business organisations to market their brands without marketing their organisations.
A sustainable business must know its strongholds; weaknesses; opportunities and threats (SWOT) through SWOT Analysis. There must be answers to the following questions: In what area does the organisation have comparative advantage/s over its competitors? What are the weaknesses of the organisation? What are the opportunities and what are the threats to business continuity? How can the stronghold be sustained? How can the weaknesses be improved? How can the opportunities be maximised? How can the threats be suppressed? Businesses swim in ‘sharks-invested water’ to arrive at success and the bigger the sharks in the water, the better the profit. Risk is a factor of margin on businesses and the higher the risk, the higher the profit and the probability of collapse. The differences between successful and unsuccessful businesses are perception and management of risks by the businesses managers.
Risk management involves the identification of risks so as to reduce, avoid or transfer them to the parties who are in a better position to manage them. A good method of identifying business risks is PESTLES analysis. PESTLES analysis considers all the risks that a business can face under political risks, economic risks, social risks, technology risks, legal risks, environmental risks and security and safety risks.
Political risks are concerned with the political stability, policy formulation and politics of the business environment both within and without a nation. Economic risks are concerned with issues like interest rate, inflation, currency exchange rate, price fluctuation, etc, prevalent in the business environment. Social risks deal with workforce diversity including cultural difference, age difference, language barrier, gender, etc. Technology risks are about the machineries and methodology which are used in processing the business.
Legal risks are about laws, rules and orders. Business environment risks, like workplace hazards, working at heights, poor supply of electricity, fluctuation in the price of fuel like petrol and diesel, bad road infrastructure and civil unrest, which may affect distribution of goods and services, wrong supply of raw materials and bad weather, should be put into consideration.
Security and safety issues have to do with health, safety and security of resources on and off business sites, that is, human, material and financial resources. The issue of kidnapping, abduction, armed robbery and road accidents and how to solve them must be factored into business operation costs. While some countries have been able to implement individual projects to alleviate business challenges like security and safety, Nigeria does not have common strategic targets for security infrastructure development yet. For businesses to thrive, good governance is crucial to ensuring the effective and efficient provision of security infrastructure in any nation.
This is largely because, firstly, good governance means that resource allocations will reflect national developmental priorities and thus respond to societal demands. Secondly, “Power Dynamics Theory” explains how the action or inaction of Party A will affect the action and inaction of Parties B and C. Corruption in the public sector will definitely attract corruption into the private and civil sectors. Government has major roles to play in curbing corruption and ensuring the rule of law.
No business organisation can survive without being specific in its mission and vision statements (SMART Analysis). Its performance must be measurable, its objectives achievable, its products and services relevant in the market and its activities, time-bound. Businesses must show sympathy to the market, empathy to the people and apathy to hardship of their customers. Only by doing the necessary things as stated above can business organisations be positioned for sustainable success.
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