Continued from Part 2
CFA: Now, talking about failure, tell us about one of your businesses that failed and why it failed?
Sam: One business that failed was, which one comes to mind? Okay, let me think of one, an ICT business I set up in Ogba. I employed somebody to run the business. We had something like a computer school, where we were training people on how to use the computer, and a business centre where you could do photocopy, bind your books, you know, a business centre. It failed just because the guy I gave it out to, I was quite busy, he was a computer guy. He wasn’t keeping appropriate records. He was unfaithful, fidelity. He would take the money and use it for other things. And because I wasn’t regular, he took advantage of things. A few times I go to the place, he is not there. He is not always there. So, I believe that what caused the failure of that business is wrong management focus and inappropriate supervision. Now, if I am setting up small businesses, I tie ropes around everybody around me, including myself. So, if you are moving to that side I drag you, you are moving to that side, I drag you. You can’t divorce. So, I’m forced to see you, you’re forced to see me. Not that I travelled, so, Mazi is not there everybody starts doing what they like to do. I work out a system that makes it mandatory that I must get your report. I must see what you are doing.
CFA: Now, okay. Looking at that particular business, if you have to do it again, considering how busy you are, what are the things that you would do to see that it works?
Sam: First is that, that guy wouldn’t have been an employee. He would be a co-owner. I would have gotten him to invest. If he didn’t invest, he will invest his sweat, sweat equity. So, his future will be tied to that business. Since I took that guy, I was paying him salary. But, if he was an equity owner, he would ensure no untoward thing happens. Other things I do now, is not only equity, I decide, I mean, one of the models I employ today is, I don’t pay you any salary. We set up a business and I ask you, any money you make from this business, you have 40% of it and I have 60%, you have 40, even if you are not an investor. So, I don’t pay you, you pay yourself. So, if after six months, you can’t pay yourself, we know that you are not the guy we are looking for. So, those are the kinds of things I do to minimize supervision. The moment you have an interest in the business, that itself is self-motivating. It helps you to look up and go the extra mile.
CFA: Now, that brings me to another question. And the question has to do with partnership. What is your take on partnership?
Sam: Partnerships are good. Just as when I have a partnership with somebody, we are running this power energy saving device which we’ve launched recently. So, he was here this morning. I was in Abuja last week. This week, he is following up on my own trip last week to do other things. So, partnerships are good because it enables you to leverage and brings out your competence and mine and then we optimize it. But the problem with partnerships is that most partnerships are entered into without proper description. If you are entering into a partnership, you have to do an MOU. There’s a guy here, we are entering into a partnership and we must sign an MOU before we become partners. It will define your own role and define my own role. We will agree on my own contribution and your own contribution. What is the way to relate? Can you spend money without my approval? Can I spend money without your approval? How do we share the profit? How do we measure your contribution? How do we measure mine? All those things are defined to make it easy for the partnership to work. The major problem with partnerships I have experienced is unrealized expectations. You are expecting me to do something or behave in some way. I am expecting you to do something or behave in a way. I didn’t tell you my processes. You didn’t tell me your own. But each person is judging each other by this unwritten expectation. And then, I’m disappointed that you didn’t come here early or you went to see your wife, you didn’t tell me. Or you didn’t come to work some day, or whatever. And I feel I’m the one laboring and you’re the one taking the benefit. I start looking for how to cut or take more benefits than you and so on and so forth. So, partnerships require definition of roles for responsibilities, accountability and reward.
CFA: Now, so, do you encourage Nigerian SME’s, who are struggling and in the same industry to consider this option?
Sam: So much so, and I preach it. I call it strategic alliance. I said we should consider strategic alliances. In Strategic alliances, you could co-operate, through co-option. You could merge. You could do franchise. You could do partnerships. You could do collaborations. Because, that is in fact the way for SME’s to succeed, i.e., by pulling resources together. I mean, you are doing your bit. This guy is doing his bit. Everybody, one thousand of us doing our little bits that comes to nothing. If we have a major competition, it will shake us all down. We will all be dead. If two, three, four, five come together, pull their resources financially, pull their resources intellectually, materially, save some costs. Instead of five head offices, you have only one. Instead of five operational vehicles, you have only two, and so on and so forth. Burning fuel, burning energy, you can save on costs and be more efficient. If we went into a place, just like four of us here, go to a company to make a presentation, the moment we arrive, the four of us, whoever is receiving us will see that a group of serious people have come. If it’s you alone, just you, there’s a way he’s going to treat you, but when he sees four guys, well dressed, arrive at their step, he will just go back first and say, “okay, gentlemen, welcome”. He moves you to a bigger room, greets you and rushes to tell his guys, “there are four of them o”. I mean, that is the psychology of leveraging, of binding, of building strength. And if it was physical strength, we have the four of us; we will certainly become a major strength. If we have one thousand Naira each, we have four thousand Naira. Four thousand Naira can do more than what One thousand Naira can do. So, I really, really recommend Partnerships. Most of the things I do, I always have Partners. I have Partners in virtually everything I invest in; I don’t do things all alone. One thing is that the Bible says that if two are together, and one falls, the other one can lift him up. And you never know when anybody can fall. You know, we are just human beings, so, there should always be somebody. My Accounts, I sign them with my wife. She is an alternate signatory, i.e., it is not A and B, it is A or B. So. If I am in Abuja and I need money, and I need money to do something, I just say sweetheart, go and collect money, she just signs her signature and money comes out. Assuming she wasn’t my wife, but somebody else, I can’t always have control. You can tell the Manager at the Bank that even though we are A and B, this A can sign One Million Naira, then this B that I don’t trust could also sign One hundred thousand Naira only. So, I limit my risk with you, but I also give you access to sign money, so that the company does not fold up suddenly because I didn’t come back from Abuja. So, it is always good to have somebody that can help cover for you, if for any reason you are unable to be present or perform or wake up one morning.