LAWpreneurship™: Dealing With the Fundamental Issues (1)

We are yet to lunch into the deep of pure legal issues as they relate to Small and Medium Enterprises and I suspect that the inquisitive ones may be wondering why. Not to worry, as typical lawyers that we are, we are just trying to follow what we call, ‘the normal procure.’  What is this ‘normal procedure,’ you may ask? It is nothing but the necessary foundation we are mandated by our discipline and order to lay before delving into the weightier matter of the law as they relate the SME sector.

Now, one necessary foundation we want to lay, which we believe will help us maximize the benefit of this column is to address our attitude as Small and Medium Enterprises operators to the relevance of experts’ advice in the management of our businesses. I am afraid that if this issue is not addressed, considering the tendency of the SME operators to neglect experts’ advice in our decision-making process this column that is out to offer legal clinical service to all SME-related legal challenges may be another exercise in futility. A sage once said, “When the purpose of a thing is not known abuse is inevitable.”

One thing that we can only shy away from at our own peril is the fact SME sector in Nigeria plagued with sundry problems. While a cursory observer may conclude that the most prominent of the problems is lack of funds, experience with the sector reveals that commoner than the challenge of funds are the fundamental problems of lack of organizational vision, principles and procedure of operation, absence of administrative structure and zeal for excellence. In fact these problems are the reasons for lack of funds. For instance, many SMEs are not able to access the funds under the Small and Medium Industries Equity Investment Scheme (SMIEIS) because they are not able to meet the requirements.   Mr. Ben Arikpo of Akada Consults shed light on the situation in an interview as follows: “Every SME wants to keep their own business; they want to continue to do things they’ve been doing. And if they continue that way, of course, no bank will put their money into them. Most of them don’t even have policies and procedures…One of the problems we have found with SMEs is that there is no clear distinction between the business person and the business…” 

These problems adversely affect the management of the SME sector by the operators. In fact these problems take their toll on decision making in the management of SMEs. The very bitter truth is, when a large chunk of a sector lacks structure, vision, principles and procedure of operation it will definitely make fatal decisions, which can only attract negative effects.

It is important to note that at the root of the challenges itemized above are two major factors:

  1. Lack of exposure as regards the standard required of a twenty-first century SMEs, which must be well positioned to milk the benefits of globalization, which have for too long eluded the African Continent.
  2. Most SMEs lack proper structures for effective administration. This is often reflective in the facts that that they are not only in most cases understaffed but also have to cope with unskilled workforce.

The way out of the woods of business mismanagement by the SMEs operators is for us to learn the wisdom of recognizing the peculiarities as stated above and therefore fashion out the strategies of survival. One of such strategies, in fact the most strategic is the resolve of SME operators to embrace the services of experts in major areas of business management.

Before we say, where do we get the funds from, let me clarify that what stands between experts’ advice and us, most of the time is not funds but information. There are Non-Governmental Organizations, government agencies, individuals etc. that exist for the sole purpose of rendering managerial support services to the SME sector.

Having established the relevance and inevitability of experts’ advice to the successful administration of SMEs, it is important to define who an expert in a particular field lest we think we can open our business to every Tom, Dick and Stupid Harry, who cannot in any way help us. When we do that we are simply though, foolishly casting you precious jewel before the swine. It will not only trample on it, it will turn round to rend us.

Who then is an expert? Going straight to the point, three qualities mark out an expert. They are as follows:

  1. Skill: It is in this sense acquired formal or personal training. The fact  that we live in a society that lays high premium on formal education makes this an important factor.
  2. Experience: This is acquired by time. It is the practical use of the skill acquired backed up by results.  It is not a requirement that an expert cannot do without at the initial stage of his career as an expert. The fact is that   it only increases his worth and effectiveness in his chosen field.
  3. Integrity: This is  honesty, honour and reliability.  This is the most important credential. That someone has skill and experience does not mean he will properly protect our interest as an expert. It is the same skill and experience, which he is suppose to use to protect us that he is going to use against us. This is because we are expected to trust an expert and his judgment.  I am in a profession that skinks with corruption and perfidy. Lawyers embezzle clients’ funds. There are all kinds of double-dealings. We just have to be sure, whom we are talking to. As far as I am concerned skill and experience without integrity is zero.

I think this is a safe point to stop this first part of issues before the issues. It is a necessary appetizer for the table that we are about to greet as this august column progresses.

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