With focus on value creation, govt firms can be competitive, says Raji

On your assumption of duties, you must have scripted an operational agenda for the organisation. One year after, how would you assess what have been done so far?
Let me first of all say that I did not come with a script of what I wanted to do. I tried to understand what was on the ground in terms of mission and vision and the specific goals we want to pursue. After understanding what was on the ground, there was an engagement session, involving the management and other relevant stakeholders. We all sat down together and tried to determine where we wanted to take the organisation to. The outcome led to a redrafted mission and certain goals we wanted to deliver. Then, we were able to come to that level of understanding. It took us time but we have started benefiting from the agreed mission and vision.

What was collectively agreed upon as mission and vision eventually?
We were unanimous in accepting that we are a business enterprise and it was important that we live up to the expectations of the business and that means that we really need to be focused on how we run the business. So, in essence, in terms of the mission and vision we have crafted, we now see the organisation as one that should be aspiring to lead in the sector and remain a leader, delivering the tasks and not be a back bencher in the sector. In terms of profit and growth, we said we wanted to be above average performance. So, we are trying to look at other companies to measure how we are moving above average in terms of manufacturing and other activities. On the mission, it is an heritage, and we are focusing on where to take the heritage. As we are today, we inherited what we have and we are looking at what we can hand over to the next generation. We took off slightly late, but it was necessary we understand what was on the ground and get familiar with opinions in terms of the strategy thrust.
Being from the private sector, what were the immediate challenges you faced joining a public organisation at the initial stage?
I will like to say that I came from an environment where we live and breath value creation, irrespective of the section. I believe that when it comes to wealth, we are making a contribution towards creating that. What I will describe as a shock to me when I came on board was that I have come to an organisation where that awareness was not there. The purpose of the organisation was not very clear. That was a big shock for me. And the fact that people have an understanding that as long as their names are on the pay roll, the need to be a driver for value creation was not important. That was initial shock to me.

And that is now what we are trying to address by engaging and asking fundamental questions from our employees on the reasons, purpose of the enterprise and we are trying to make them see that ownership is government but the organisation is for business. The only difference is that government owns it (Odu’a), but we are playing in the same terrain with others. So, we are bringing to the attention of the people that creating wealth means that you need to play by the rules of the game.

So, how have you been trying to address that attitudinal disposition of the workers?
The first thing is significant engagement and involved making the workers appreciate the essence of a business organisation, letting them know that those of us working here are really privileged to be custodians of our common heritage as Yorubas, how we should be concerned on our financial performance and its importance to the value and revenue we are generating over a period of time.

The second thing which is related to strategy is that we brought in those who are dear to many other people, who have a wide tested experience and are resourceful, and they they know the economy in and out, internally and externally. So, by the time we had serous engagements and deliberations, we realised that if we really want to succeed, we just have to copy what those who have succeeded are doing.

How are you coping with the diversified interests of the business owners, especially coming from the standpoint that government doesn’t see business as you see it?
Frankly, I must confess that we are privileged with the set of people we have as executive governors from the owner states. Their experiences are solid and a sizeable number of them have antecedents of having operated at the highest level. Our owners have a clear understanding of the business and I think one of the fundamental reasons they use in registering the business was actually conceding that the topmost job for this organization needs to be by searching for credible people from the private sector. So, the people that are being hired from the private sector are for some specific deliverables. Fundamentally, I will say our state governors are the major backers , who believe that business should be credible and deliver resources and values to shareholders.

These state governors recently set up development agenda for the South West zone. What are the roles Odu’a is supposed to play under this initiative?
First of all, I want to say we should count ourselves lucky as South Westerners or what we use to call the old West and that is what also gives the fulcrum to set up that agenda. We are talking about regional integration and if one wants to qualify it, the whole idea is all about development on all fronts, particularly social and economic development. So in essence, they are exploiting the truism that there is synergy in pulling together, rather than going it alone, state by state. I take it to be that Odu’a really can be seen to be a big pillar that encourages the setting up of the agenda. The difference however is that it is strictly a business enterprise and we are to participate in business to create wealth and engender sustainable growth.

The programme, known as Development Agenda for Western Nigeria (DAWN), is a policy body meant to articulate and bring about a consensus in terms of direction to go on social and economic front, for the entire South West, including Lagos and it is emphasizing on trying to complement each other and that goes across social and economic spheres. So, there is a close relationship between us and DAWN, as the agenda was actually created almost 40 years ago to bring about economic development of the South West, with Odu’a as a major driver. We are focusing ourselves on the needs of today and those of the future, with fundamental commitment. As soon DAWN is able to develop those policies, the states should not recreate it, rather, they should copy and paste, to ensure an alignment for total development and growth for the entire region. So, we believe that DAWN has a social mandate as far as social and economic development is concerned and within that context, we are backers of DAWN and that is the purpose of the existence of Odu’a. We are now broken down into states but we still need a centre body to help us articulate those policies so that we can arrive at a consensus

How are you strategizing at revamping the manufacturing arm of Odu’a business? You started up credibly well with Ire Brick industry in Ekiti. Which other companies are now under your focus?
Ire Brick Industry was something we inherited and it our responsibility that it functions well. it is back into production now and we are trying to stabilize it and a lot of credit should also go to the previous group managing director and the governors of Ekiti State. We are responsible for management and we hold it top in our agenda that it is a success to give confidence to everybody. It terms of revamping other outfits, in principle, we will not be specific to say that this is what we are going to do, but we will be guided by sound economy and business principles for the decision making. We will not be involved for the purpose of getting involved. We will get involved because we believe that there is an opportunity for everybody and that also stretches to the future. And that opportunity is also profitable and sustainable. Recently, we took a look at Cocoa and we did a detailed research about it.

This study was carried out between October 2014 and February 2015 and by the time we were through, we found out that the raw cocoa beans, which was N420, 0000 per ton in October when we started the study locally has become N587,000 a ton in February. For the output from the factory which usually will be butter and cake, the global price for cake which was a $1, 400 and for butter $5,850. So, we were asking ourselves the reasons for this and that study revealed that there were massive speculations relating to purchase of produce and round-tripping and people actually converting naira into dollar, using the produce trade to effect it. We realised that we are in a business where money launders are competing with us. So, we got to the board to share this statistics and then said for the meantime, we are resting it, to resume whenever the condition becomes more conducive for us.. You can now see that for us, whatever we are going to do must be something that can stand the test of time. As we are also interested in agro-allied business, we will do a study which we will assist us in taking vital decisions about it.

The previous administration made attempts to revive the Sketch Publishing Company. What is the situation now?
For Sketch, we are still making progress with the private sector entity that talked to us about it. We know it is something good and would help in filling the information gap in the South West. We are progressing in this conversation. We want to make sure that every plan is well mapped out and then we can go on to allow the entity talking to us to go ahead. Anytime we reach that level, we will give the communication out to everybody.

Are you still planning to sell Lagos Airport Hotel?
There have never been a time that we said we are going to sell Lagos Airport Hotel. We were trying to work under a scheme called Lease, Redevelop, Operate and Transfer (LROT). We tried but stopped but we are still going to do it. The hotel, in the past, was the main facility of its type in Ikeja, but the economy opened up and there are new requirements as far as hospitality is concerned and we have failed to be able to migrate to these requirements. That is what we intend to achieve with the lease arrangement. The whole idea is that we have an hotel that can compete with any other one in Lagos. The essence is to make the entity realise it own potentials and render quality service. As it stands, the place has issues with funding and renovation.

Is that arrangement targeted towards rebranding?
The option of rebranding is there and frankly, everybody knows that international brands do well in terms of patronage. So, if we are talking about current and the future, that should be on the table and it is part of the decision we shall take with the LROT option.

Was that reason for the retrenchment exercise carried out recently at the hotel?
When you talk about lay-off exercise, I need to stress that we need to ensure effectiveness in the running of the hotel to ensure good return on investment. This is fundamental in running a business. A situation where profit continues to decline and we ended up with a loss last year, demands that certain measures should be taken. We have taken action on the basis of fairness, ensuring that we live up to our responsibility as managers of the business.

Some member states have been establishing their own respective industrial companies. Won’t these run at cross purpose with Odu’a?
Honestly, they cannot run at cross purpose with Odu’a. The state investment companies have their clear purpose. While they focus on the state, ours is regional. What we need is to demonstrate that we are carrying a regional flag and delivering performance that the entire region can be proud of. The state companies carry state flags. And certainly, the priorities are going to vary from state to state.

To actually achieve the aims of DAWN, don’t you think is will be prudent to merge Odu’a with Ibile Holdings in Lagos?
Ibile Holdings is owned by Lagos State government. I think as like minds and the objectives we set is important. There’s strength in number, no doubt about it. I believe if in our conversations, we are able to get a consensus, it will be a good thing. We will be complementing each other. But take a look at it, a sizable number of our investments are in Lagos. You will recall that Lagos was part of the Western Region, except the area called Lagos colony. So, there is a strength for us to see how Odu’a and Ibile can collaborate, for the realisation of DAWN’s objectives.

Haven’t you seen the need to privatise Odu’a?
There is the primary need to make the organisation attractive to investors. To take Odu’a to the capital market will require packaging it well enough as a good company that investors will be scrambling to invest on. We need to demonstrate that we are a business that’s respected, with a future and sustainable. It is after then that we can bring the issue of privatisation to the table.