Seeking the next Dangote

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America, still regarded by many as the land of opportunity, being the largest economy in the world, like every successful western and even Asian civilisation, was built on the strong backs of capitalists who were willing to chart the course and take the bull of development by the horn. John D. Rockefeller, Cornelius Vanderbilt, Andrew Carnegie, Henry Ford and J.P. Morgan rose from obscurity, and in the process built modern America. Their names hang on street signs, are etched into buildings and are a part of the fabric of the nation’s history. These men created the American Dream as we know it today and were the engine of capitalism as they transformed everything they touched in building the oil, rail, steel, shipping, automobile and finance industries. Their paths crossed repeatedly as they elected presidents, set economic policies and influenced major events of the 50 most formative years the country.

American capitalists, as is the case with capitalists in general, had almost a free hand in gaining control of a country unimaginably rich in natural resources and whenever in straight-out contests of strength with both organised and unorganised workers, capitalists usually triumphed. State violence, judge-made law, compliant legislatures, government incentives and administrative procedures were arrayed effectively in favour of their respective enterprises, which gave them an almost total monopoly in their various sectors.

Aliko Dangote, Nigeria’s own model capitalist, a northener from Kano State, born on the 10th of April 1957 into a wealthy Muslim family, right from when he was young had an eye on business. “I can remember when I was in primary school, I would go and buy cartons of sweets [sugar boxes] and I would start selling them just to make money,” he said. “I was so interested in business, even at that time.” Mr Dangote studied business at the Al Azhar University, Cairo, and thereafter returned to Nigeria to work with his uncle, Sanusi Dantata; who afterwards gave him a loan ofN500,000 when he was just 21 years old to start a business.

The Dangote example

The Dangote Group, which started as a small trading firm, established in 1977, is today a multi-trillion naira conglomerate with many of its operations in Benin, Ghana, Nigeria, and Togo. At present, Mr Dangote has enlarged his line of businesses to cover food processing, cement manufacturing, and freight, also dominating the sugar market in Nigeria. In fact, it is the major sugar supplier to the country’s soft drink companies, breweries, and confectioners. Besides these achievements, Dangote Group has also moved from being a trading company to being the largest industrial group in Nigeria and these include: Dangote Sugar Refinery, Dangote Cement, and Dangote Flour just to mention but a few.

In Nigeria as of today, Dangote Group owns salt factories, flourmills, and being a major importer of rice, fish, pasta, cement and fertilizer. The company exports cotton, cashew nuts, cocoa, sesame seed and ginger to several countries. It also has major investments in real estate, banking, transport, textiles and oil and gas. The company employs over 11,000 people and is the largest industrial conglomerate in the whole of West Africa.

Mr Dangote is also exploring into telecommunications and has started building 14,000 kilometres of fibre optic cables to supply the whole of Nigeria; and as a result, he was honoured in January 2009 as the leading provider of employment in the Nigerian construction industry. Recently, 12 local and international banks agreed to loan his group $3.3 billion to build Nigeria’s biggest petroleum refinery and petrochemical/fertilizer plants, with the factories expected to create an additional 9500 direct and 25 000 indirect posts.

Succession planning

Succession planning, in HR terms is a process for identifying and developing internal people with the potential to fill key business leadership positions in the company. Succession planning increases the availability of experienced and capable employees that are prepared to assume these roles as they become available. Taken narrowly, “replacement planning” for key roles is the heart of succession planning. Effective succession or talent-pool management concerns itself with building a series of feeder groups up and down the entire leadership pipeline or progression (Charan, Drotter, Noel, 2001).

It is clear that Nigeria needs a few more men like Mr Dangote, who can, in building their personal empires, help develop the nation; while at the same time redistributing the wealth through jobs and contracts.

The unfair advantage

In their research on “Winning in Emerging Markets”, Harvard professors – Tarun Khanna and Krishna Palepu – theorise that emerging economies have unique combinations of institutional voids (e.g. the absence of market intermediaries or inefficient contract enforcement mechanisms). What makes Mr Dangote stand out from the pack is his canny ability to make these institutional voids work in his favour, while also dealing with the complex web of entrenched political interests in Nigeria, and his ability to navigate them.

Analysts have said that Mr Dangote’s business enterprise is responsible for about 4% on average of Nigeria’s GDP YoY and probably the largest employer of labour after the Nigerian government and the agriculture sector. Though Nigeria also boasts of several other billionaires whose business enterprise can be said to be capitalist in nature, none can be said to have demonstrated that raw business acumen mixed with that insatiable thirst to conquer new fronts as that ‘The Nigerian capitalist’ Aliko Dangote.

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