As an organisation that pride itself on innovation, teamwork, and transparency with open, candid communication – Heidelberg Nigeria Limited (HNL) has been exceptional in its representation of Heidelberger Druckmaschinen AG, Germany – world-renowned and respected leader in manufacturing and distribution of Printing/Publishing Solutions across West Africa. For one thing, the company encourages high expectations, ambitious goals and hard work to reach its financial goals, and for the other, HNL always accept change as the rule, not the exception, and drive it by encouraging creativity especially in this ever-changing VUCA business landscape. And that is the focus of this SPECIAL FEATURE INTERVIEW where WHERE To Print Crew caught up with Managing Director – Mr. Godwin Ogilo. As a financial expert with varied experience in negotiating, restructuring, and closing multi-million-dollar business transactions, HNL Chief shares his expert knowledge and advice to print & allied practitioners especially on how to successfully manage, grow, and sustain their businesses in this volatile, uncertain, complex, and ambiguous business world. Except below:
WITHOUT DOUBT, THE PRINTING INDUSTRY IS ONE OF THE BIGGEST HITS DURING COVID-19 PANDEMIC WHOSE IMPACT IS STILL BEING FELT EVEN AFTER OPENING OF BUSINESSES AND RELAXED REGULATIONS AROUND THE WORLD; WHAT FUTURE DO YOU FORESEE FOR THE INDUSTRY?
You are right, the industry has been passing through the phase of diminishing demand since 2020 and these declines in productivity have been exceptionally challenging for many printers, particularly those in commercial prints segment compared to packaging Printers. I see the Post COVID-19 era as evolution of a new chapter in the Printing Industry, rather than one that’s trying to recover from a global pandemic. The market conditions have remained incomparable to that of 2019. We are not witnessing recovery; it’s a total reinvention or re-engineering. Like everything in life, there will be ups and down sides. What the future holds out is the need for every print business to make some strategic decisions on how to minimize the downsides and take advantage of the upsides. The up sides are the growth-oriented segments of the industry e.g. packaging, digital printing etc. To Printers, the critical factors for success will be the ability to deploy, implement, and optimize the use of technology, integration, and digital transformation of your printing business.
WITH PRICES OF ALL PRINT INPUT GONE UP, WHAT ADVICE CAN YOU OFFER ENTREPRENEURS IN THE INDUSTRY TO ENSURE THEY REALISE THEIR BUSINESS OBJECTIVES OF HIGH ROI, AS WELL AS MEET CUSTOMERS’ EXTREME EXPECTATIONS?
With such a competitive marketplace out there, quality service is still the number one thing that differentiates businesses in customers’ eyes. I will advocate that organizations implement robust customers’ retention strategies which are capable of getting new customers and keeping old ones. Once the customer realizes that you understand and anticipate their needs, they’re much more likely to choose or come back to you instead of shopping around to your competitors. I will recommend that the establishment of good customers’ relationship management will help the entrepreneurs to achieve their objectives and remain profitable.
CONSIDERING THE PECULIAR NATURE OF THE MARKET, WHAT DARING PATH DO YOU THINK ENTREPRENEURS SHOULD TAKE NOW TO POSITION AND SUSTAINABLY GROW THEIR BUSINESSES IN THE NEAREST FUTURE?
Business evolution is the answer- the era of business as usual has long gone. They will need to vigorously adopt new technology for them to thrive and grow. There are a surprising number of new opportunities, but Printers must be willing to make significant changes to take advantage of them. The Nigeria Printing Industry is experiencing growth in Digital printing, Mono carton packaging printing and Label printing. This is due to the gradual growth of locally made products that ordinarily would have been imported in the past.
WHAT IS THE PLACE OF FEASIBILITY STUDY AND/ OR BUSINESS PLAN IN DRIVING PRINT BUSINESS GROWTH?
A business feasibility study is a detailed analysis of the viability of an idea or concept for a business venture. Once feasibility has been determined, a business plan documents the operational and financial objectives of the business and the detailed plans to achieve them.
Business plan/feasibility study is the road map of any business. Without it, the business is destined to fail. Its importance can never be over emphasized to an entrepreneur. It is the radar that helps entrepreneurs identify the strengths, threats, weaknesses and opportunities in the business environment. Possible problems and challenges are caught at the developmental stage and solved.
A business plan can often be the single most important document you can present to your investors that will provide the structure and confidence that they need to make decisions about funding and supporting your business.
THE WORLD OVER, A SOUND INTERNAL CONTROL SYSTEM IS KEY TO PROFITABLE AND SUSTAINABLE BUSINESS, WHAT ARE THE THINGS ENTREPRENEURS SHOULD PUT IN PLACE TO ENSURE SOUND INTERNAL CONTROL SYSTEM?
Internal control systems minimize risks and protect assets, ensure accuracy of records, promote operational efficiency, and encourage adherence to policies, rules, regulations, and laws.
Internal control should be embedded within the organizational structures, procedures and culture. It should be capable of responding quickly to forestall unnecessary risks to the business arising from factors within or outside the company and to changes in the business environment. This requires elements such as segregation of functions, authorization systems and procedures, data processing method, maintaining competent personnel, records’ maintenance, strong management information system etc.
Also, a sound internal control system include procedures for reporting immediately to appropriate levels of management any significant control failures or weaknesses that are identified, together with details of corrective actions that may be undertaken.
WHAT ARE THE MOST COMMON WAYS THAT FRAUD SPREADS IN THE ACCOUNTING DEPARTMENT AND HOW CAN ONE MITIGATE IT?
First and foremost, we need to know that the root cause of fraud is human beings. Deficiencies in accounting systems or technology are a symptom rather than a cause – and even these are the result, directly or indirectly, of human failings.
The Accounting Department is the gatekeeper of any organization. Frauds can occur in diverse ways in any organization especially the Accounting Department. Therefore, frauds prevention and detection are major assignments of the Accounting Department. Recognizing what fraud looks like is the first step to protecting your business from it. This may include and not limited to Payroll, Asset Misappropriation/Skimming, Embezzlement, Double Cheque Fraud, Ghost Employees Schemes, Fake Supplier Fraud, Invoicing Fraud Schemes, doctoring of Financial Statement Fraud, Tax Fraud, Bribery and Corruption, Return Fraud, Monetary Exchange Fraud, Insurance and Banking Fraud etc.
It’s important to make Fraud Reporting a part of your company culture. Encourage people to raise red flags – that is: “See Something, Say Something”. Have specific and comprehensive anti-fraud, anti-bribery and anti-corruption company policies. Make sure your policies can both bark and bite by implementing the policy and enforcing consequences when an employee violates these policies. Do surprise audits and inspections regularly. Regular checkups can help you spot fraudulent behavior and mitigate the damage immediately.
DO YOU THINK THE OLD PROPER ACCOUNTING AND BOOK KEEPING RECORDS OF ALL TRANSACTIONS IS OUTDATED? ANY SUGGESTIONS ON RELEVANT SOFTWARE TO USE?
Technology has changed the method of accounting and book keeping today but the principles of accounting remain intact. Bookkeeping is now automated. These new advancements are much more intuitive, helping accountants do their job quicker, more accurately, and seamless.
As for recommendation, there are no one size fit all. The scope of the business concern will determine the type of accounting systems it can put in place. There are several computer-based software systems for small and medium enterprises and robust all-encompassing management information systems for large organizations. The choice is again dependent on affordability and the ability/competence to apply the processes.
HOW RELEVANT IS COMPLIANCE WITH REGULATORY AUTHORITIES LIKE FEDERAL INLAND REVENUE SERVICE, STATES’ AND LOCAL GOVERNMENTS’ TAXATION, CORPORATE AFFAIRS COMMISSION, PENSION, ETC ALL TO BUSINESS SURVIVAL AND GROWTH?
Regulatory compliance is a must and an intentional function/obligation that forms an integral part of the way businesses are operated. For companies to operate in Nigeria without hindrance or reduced non-compliance risk, it must comply with the different statutory provisions/laws of doing business in Nigeria.
Non-compliance will bring bad publicity to the company, thereby affecting the brand integrity of the defaulting company. Sanctions for non-compliance of companies could be in form of fines and penalties which could in turn, affect the profit made by the defaulting company; it can also have a negative impact on the company’s reputation and disruption of the business activities of the company.
WHILE SOME BELIEVE THAT IN THIS VUCA WORLD (OF VOLATILITY, UNCERTAINTY, COMPLEXITY, AND AMBIGUITY), BUSINESSES LIKE YOURS MAY FIND IT DIFFICULT TO CHANGE AND ADAPT; WHAT SHOULD A MANAGEMENT TEAM DO IN THIS SITUATION?
Your question is just saying the obvious of today’s business environment. Any business that is not flexible and resilient enough to accommodate VUCA cannot survive in today’s business environment. It demands that we avoid traditional, outdated approaches to management and leadership and on our day-to-day work. The traditional business models are usually too sluggish and ineffective in a turbulent environment.
Modern business models are newer, more agile and offer pragmatic processes that are key to managing in the VUCA world. These make visioning, understanding, clarity, and agility our guiding principles to counter the threats of VUCA, and to turn them to our advantage.
IN BUDGETING, WHAT SHOULD A PRINT & ALLIED CONCERN TAKE INTO COGNIZANCE?
A budget is an estimation of revenue and expenses over a specified future period of time and is usually compiled and re-evaluated on a periodic basis.
Printing and allied businesses are not insulated from the danger of lack of budgeting or inadequate budget. Having a budget in place is important because it allows you to have an overview and better understanding of the organizations’ activities and applications of scarce resources within a given period of time. It helps to capture how much money you have, what your expenses are, and how you will be able to afford things in the future.
A Print and Allied concern budget should take into cognizance their income, fixed expenses, variable expenses (overheads), unplanned expenses and savings.
HOW CAN PRINTERS IMPROVE THEIR FINANCES ESPECIALLY CASHFLOW?
Cash flow is the life wire of any business and all hands must be on the deck to maintain a healthy cash flow for the organization. All channels of revenue generations must be well lubricated to forestall any eventualities.
I think on the part of operation, Printers should start to look at the benefit from the power of production automation, colour and quality management while also providing key data for analysis and reporting. This will keep their customers coming back and maximize your performance with a smart workflow.
Printers can improve their cash flow by reducing cash outflows. For example, by securing better trade credit terms or factoring, chasing debtors, selling assets or securing an overdraft.
Printers must maintain the culture of proper bookkeeping, cut spending where necessary, and speed up accounts receivables, also not forgetting inventory management.
FUNDING IS VERY IMPORTANT IN OUR INDUSTRY, WHAT ADVICE DO YOU HAVE FOR WOULD-BE LOAN SEEKERS FOR BOTH WORKING CAPITAL AND PLANTS & EQUIPMENT SO THAT UNFAVOURABLE ISSUES WONT ARISE?
Many Printers often complain of inabilities of getting funding from banks and other financial institutions. The major reasons why they do not get these funding are because of lack of proper book keeping and lack of structure. These two issues must be addressed for them to be empowered to receive funding from the financial institutions.
When it comes obtaining loans, there are some pitfalls. To avoid unfavorable issues that may arise as a result taking a loan, the investor needs to get adequate information on the area of the industry he intends to play. He must seek professional help/education in the choice of loan and also understand the market in order to be competitive and effective in the industry.
WHAT ADVICE CAN YOU GIVE TO ONE WHO’S SEEKING/ LOOKING TO CREATE A GREAT BOARD AND MANAGEMENT TEAMS THAT WILL STAND THE TEST OF TIME?
The success of any business enterprise is dependent on the quality of the Governing Board. The Governing Board of any company is like the human body system with each organ performing its specialized and distinct functions.
Building a great team requires a special skill of aggregating skillful men and women of impeccable characters, knowledgeable in diverse fields like accounting, law, management, human resources etc., with requisite wisdom and ability to work as a team.
The team building demands matching jobs to people’s skills. That means giving people responsibilities according to skill level. Even as the business owner, you don’t give yourself an impressive title and job unless you’re right for the job. The fact is, many smart entrepreneurs hire their own boss when they realize their skills lie elsewhere in the company.
WHAT DO YOU THINK MAKES A PRINT CONCERN STAND OUT AMONGST COMPETITION?
Standing out from competition is critical to every print company’s success. While some understand that concept, far too many printers fail to put it into practice. They need to understand the market they are playing in and develop capacity to consistently deliver top quality products/services and at competitive pricing within the given markets.
Secondly, they must have unique tools and equipment that will give them competitive edge over their competitors, not forgetting investment on quality and formidable human capital.
PRINT BUSINESS CAN BE STRESSFUL AND HECTIC, WHAT ADVICE DO YOU HAVE FOR AN ENTREPRENEUR IN ORGANISING OR ENSURING A STRESS-FREE AND ENJOYABLE BUSINESS?
Investing in appropriate technology, human capital and capable management is the solution to stressful and toxic business environment. In addition, balancing your professional and personal life can be challenging, but it’s essential. It has numerous positive effects, including less stress, lower risk of burnout and a greater sense of well-being. This not only benefits employees but employers as well. Employers who are committed to providing environments that support work-life balance for their employees can save on medical costs, experience fewer cases of absenteeism, and enjoy a more loyal and productive workforce.
HEIDELBERG NO DOUBT ENJOYS TREMENDOUS GOODWILL IN THE INDUSTRY, HOW DO YOU THINK A PRINT & ALLIED CONCERN CAN ENJOY GOODWILL WITHIN ITS STAKEHOLDERS?
Goodwill comes with a price; it takes years of hard work, commitment, dedication and honesty to build. Heidelberg has paid its dues in the areas of technology leadership, manpower development for the industry, and other Corporate Social Responsibilities (CSR). Today, this is rubbing off on all of our numerous customers worldwide. For the fact that you are Heidelberg equipment user confers a certain pedigree and good will in any business environment that you find yourself.
Investors understand the importance of goodwill and what it builds with customers. If your company has a positive reputation as a result of the goodwill it has built, it will increase its value. The printers need to encourage brand loyalty by making their customers feel good about doing business with them and they also need to embark on corporate social responsibility.
WHAT HAS BEEN THE HARDEST (OR THE EASIEST) DECISION EVER MADE AS HEIDELBERG NIGERIA MANAGING DIRECTOR?
One of the hardest decisions I have had to make is when I have to choose between strong team members for a promotion. There have been occasions when, even though I liked one person better than another, I nonetheless had to choose the other person based on his/her potential to assume the responsibilities of the new role. Sometimes, I also had to promote younger employees over staff with seniority, simply because they were more skilled in the use of technology and more energetic to cope with the tasks of the new role. It’s never easy, but ultimately you have to think about who will be the most effective and productive in the new position.
WITH INFLATION, MARKET PRICES, GOVERNMENT POLICIES AND OTHER VARIABLES AFFECTING PRINT PRICES, HOW DO YOU THINK A PRINT ENTREPRENEUR CAN ADAPT, MANAGE AND SUCCESSFULLY NAVIGATE THE TERRAIN TO BECOME SUCCESSFUL?
Generally, businesses thrives in conducive and sustainable environment; the lack of which allows for malpractices, corruption and sub-standard ethical practices.
An entrepreneur should understand that integrity/ethics as a concept, is central to growth, development and survival of business.
Due to the current exigencies in the country, many business owners or businesses are throwing ethics over board and engaging in so many sharp practices. This trend cannot be sustainable. No matter what, honesty is still the best policy.
WHAT HAVE BEEN THE BIGGEST CHALLENGES YOU’VE HAD TO OVERCOME IN THIS HIGHLY VOLATILE MARKET?
Nigerian business environment is full with so many challenges but the most critical for me are sourcing foreign exchange to do business, and generating new businesses and how to retain our existing customers.
HOW DO YOU SEE THE COMPANY CHANGING IN THE NEXT DECADE, AND HOW DO YOU SEE YOURSELF CREATING THAT CHANGE?
Heidelberg is a very resilient and dynamic company, still maintaining its technology leadership despite all odds. We are very optimistic about the future hence we are not slowing down at all.
In the next decade, I see the company being bigger, more virile and remaining a profitable entity.
