While the internal business environment is within the control of business owners, the same cannot be said of the external business environment. The single most important influence in today’s external business environment are disruptions due to the COVID-19 pandemic; and the resultant effect, with or without a lockdown or the successful introduction of a vaccine, will not be going away anytime soon. As a result, we would have to accept that the world would likely not be back to normal in a short time. A strategic change in the way we think is required, and for the discerning, the reality principle readily comes to mind: See the world the way it is and not the way you wish it were, and only then can intelligent decisions be made about the future.
In recent years, the average economy of sub-Saharan African countries has experienced some level of growth, with some analysts projecting an even swifter growth that would rival or even surpass that of the average country in Asia, in the coming years. A significant portion of this economic gains can be attributed to the remarkable boom in the SMEs, and the resilience of individual entrepreneurs who continue to strive in spite of very little incentives to remain active, and a weakly developed business environment typical of the region. However, a major challenge to the survival of SMEs in Africa has emerged in the form of the COVID-19 pandemic. This is a High-Impact Low-Probability crisis that brings with it a baggage of unavoidable threats – lockdown, social distancing, etc., that are alien to Africans, hence, posing a threat to the norms and values that typify the African society. A visitor to Africa would quickly notice that business relationships and friendships are easily interwoven, thus, survival in the face of this pandemic will go beyond being resilient in entrepreneurship, or assistance from an almost non-existent government palliatives, but (i) accepting the dynamic change in industry/business standards; (ii) deploying new business models and (iii) thinking new ways to do business.
The SMEs in sub-Saharan Africa need to accept the change that has resulted from this COVID-19 outbreak. Things are already looking different, and those SMEs that will sink are the ones that will waste time waiting for things to return to the usual. That won’t happen fast, and this presents an opportunity for fast thinkers; as speed of action is of the essence for businesses to better position themselves relative to their competitors, hence, gaining that extra competitive advantage. If your business requires your employees to be cramped up in an office space or involves a lot of contact with customers, this may not be sustainable during this period and in the immediate future. Although it may not be economically viable for a lot of the SMEs, there are ways in which they can go around this. A simple analogy readily comes to mind: the much-talked-about second boxing fixture, Anthony Joshua Vs Andy Ruiz, that took place early this year. The first match ended up in an upset in which the challenger (Andy Ruiz) scored a surprise knockout victory, due largely to his strength in close combat which was superior to that of his opponent. However, the second fixture saw Joshua accepting that he had to change his style away from the aggressive boxing style of the ’80s and ’90s and going for points instead; this earned him victory, albeit in a manner that many boxing fans do not fancy.
Deploying new business models requires hard work and dedication, and this has the potential to deliver gains in the long run, because as the saying goes, hard work beats talent when talent doesn’t work hard. Sub-Saharan Africa SMEs do not need to be so stiff and fixated on their line of pre-COVID-19 businesses; now is the time to think up new businesses or new markets for their businesses. New markets don’t only mean a new/different geographic location, but it also involves a new market segment/category of customers which they can focus on. For example, it might come as a shock to many that Apple Inc., the tech giant, went into the production of surgical masks as well as other protective medical gears. The same is said of H&M and some of its competitors in the apparel industry. They leveraged the current situation to open new market segments, and though many may argue that this was done on purely humanitarian grounds, one cannot wash away the massive public relation boost this has got their brands. It all boils down to a change in thinking. It doesn’t have to be the good old products that you are used to manufacturing or service you are used to delivering. Look around you and seize new market and product segments, make internal adjustments, and frame your organisation structure along new projects, products, and customer lines.
Another strategy is to work out a change in the way of delivering goods and services. New distribution channels, as well as technology deployed in migrating to online platforms, either to facilitate the delivery of their products or to create an online presence that you can leverage on, post-COVID-19. Accepting the dynamic change in industry/business standards, deploying new business models, and thinking new ways to do business are ways the SMEs in sub-Saharan Africa can prepare themselves to cope with the challenges of COVID-19. This presents an opportunity to be an industry leader, by quickly redefining standards in this new battleground to gain competitive advantage. It is what we make out of what we are given, that separates one person from another.
In my opinion, if businesses don’t have the capabilities to fit into these three strategies elaborated above, they might consider closing shop and cut all unnecessary expenses, to avoid further losses while waiting for the post-COVID-19 era to begin.
- Dr. Osaro Aigbogun is a strategist and business coach based in South East Asia
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