Skip Ribbon Commands
Skip to main content
Sign In
Jun 15



LBS:  Dr Oghenovo Obrimah, congratulations on being recognised as a top 10% author on the reputable Social Science Research Network. (  It must be nice to be ranked alongside Nobel Prize winners  like Professor Eugene Fama.

Dr Obrimah: Thank You. It always feels good to be recognized for one's output and productivity particularly when the recognizing agent has reputation, as is the case with SSRN,          which now is associated with what arguably, is the most reputable brand in academic what arguably is the most reputable brand in academic publishing-Elsevier               

LBS: Dr Obrimah, you just presented a paper at a conference ( with focus on entrepreneurial financing, particularly, angel financing, crowdfunding, and venture capital. What exactly do these terms, angel financing, crowdfunding, and venture capital mean?

Dr Obrimah: Venture capitalists - investors who provide venture capital financing - operate within context of legal entities called venture capital funds. They raise capital from investors to invest in high risk, high growth ventures whose business ideas are robust enough to enable these ventures become publicly quoted companies. Since they raise funds from investors, they are financial intermediaries - agents or firms that connect suppliers and demanders of capital.

 Angel investors - investors who provide angel financing - are sophisticated individual investors who seek out promising projects that are not promising enough for venture capitalists. These ventures typically have secured a patent already, or have a product that is ready for patenting.  While these investors invest their own money, they increasingly are operating within context of well-defined groupings, as such increasingly are functioning like a consortium of individual investors inclusive of a gatekeeper who may not invest any money of his or her own but acts like a financial intermediary.

Crowdfunders - individuals who provide financing within context of crowdfunding platforms - are a potpourri of sophisticated or relatively non-sophisticated investors seeking investment opportunities.  Crowdfunding that involves provision of financing in exchange for debt or equity certificates is the most credible form of crowdfunding and is the sort studied by academics.  Firms seeking crowdfunding list on a crowdfunding platform (e.g. Indiegogo, Kickstarter, Crowdfunder) and attempt to convince crowdfunders to invest in their business model.

LBS: Dr Obrimah, thinking about your descriptions of the three different classes of investors, it seems difficult to disentangle ventures that attract one form of financing from the others. What are the distinctive differences between ventures that attract venture capital vis-a-vis angel financing, vis-a-vis crowdfunding?

Dr Obrimah: The most important distinction is the anticipated growth rate of the company. If the business model cannot be grown so fast the company delivers a good return within a few years, a good company with a good business model may not be able to attract venture capital financing. The company, however, may be able to attract either of angel financing or crowdfunding.  If the company does not have a unique product, it may not be able to attract angel financing, but may be able to attract crowdfunding.

LBS: What was the focus of the paper you presented at the conference?

Dr Obrimah:  In my paper, I develop a theoretical model that predicts which types of entrepreneurs should approach which types of venture capitalists for financing. Since financing terms are functions of project quality as opposed to functions of the person of entrepreneurs, the paper predicts which types of projects should be funded by which types of venture capitalists. Interestingly, it appears the prediction holds not only for venture capital but for angel financing and crowdfunding as well. 

In terms of details, the paper predicts the riskiest high growth projects should be funded by venture capitalists that have the highest ability. This prediction actually  runs counter to the prevailing wisdom in stock markets. In stock markets, the highest ability underwriters are predicted to underwrite the least risky issues of  equity.  This has been shown to be true. As you can see then, arriving at the opposite prediction in venture capital runs contrary to the conventional wisdom, but is consistent with predictions in one of my other papers (

LBS: What was your main take away from the conference?

Dr Obrimah: I have always studied entrepreneurial financing from the financiers' perspective. It was interesting to find other researchers studying entrepreneurial finance from the entrepreneurs' perspective arriving at conclusions that in principle do not contradict knowledge generated from study of financiers, such as venture capitalists. 

LBS: What are the lessons for Nigeria and Africa?

Dr Obrimah: If Africa does not get its act together, the distance between Africa and developed countries will continue to grow. Crowdfunding has emerged in part as one avenue for non-sophisticated investors to generate higher returns than they can obtain from savings accounts or bank deposits.  Neither of angel financing nor venture capital, which has been shown to be very good for facilitation of economic development are well developed in Nigeria or Africa. While these sources of financing remain largely undeveloped in Africa, they are becoming increasingly more sophisticated in developed countries. Frankly, Nigeria and Africa are increasingly being left behind. There is a need to address and attempt to redress this developmental gap. 

LBS: It has been a pleasure having this discussion with you Dr Obrimah.

Dr Obrimah: Thank you for the opportunity to engage the LBS community and visitors to our online sites in this discussion.











Apr 25
5 Ways to Keep Employees Motivated in a Recession

LinkedIn Showcase.jpg

An interview with Uche Attoh, LBS Faculty and Human Resource Specialist on how to keep employees motivated in a recession.​​

CC: What is Employee Motivation?

The word motivation derives from a Latin word "moverim" meaning to move. What it generally means is how you move.  In business terms motivation relates to three areas: attitude to work; behavior, which is a manifestation of the attitude; and the output which is produced.

Therefore, when we say motivation, it means the internal or external factors that will predispose an individual or employee to move in a particular direction that will lead to a positive change in attitude, behaviour and output. 

CC: What are the Signs an Employee is Demotivated?

UA: Generally, as a leader in any organisation, we need to look at the attitude, behaviour and output of employees. What is the attitude you perceive?  What is the manifestation of behaviour?  What are they producing?  When you begin to see negative tendencies in all these, it tells you immediately that people are not motivated.

CC: What can Employers do to Motivate their Employees in a Recession?

UA: There are several theories of motivation such as the Maslow hierarchy of needs. For years, managers have adopted this theory of motivation, but recent studies by Harvard Business Review has seen that some of these classical theories are culture bound and they relate to the culture in which those theories were developed. In other words, what motivates a European may not necessarily apply to an African, which is why classical motivational theories failed in many parts of the world.

On the other hand, there are universal theories and factors, which come to play when thinking about employee motivation most especially in a recession. Organisations must ensure that certain factors and fundamentals are in place in order to ensure employee motivation. These factors include the following:-

1. Organisational Justice: This is an important area that may predispose individuals to motivation. The extent at which employees perceive a high level of organisational justice determines how much employees will be motivated.  There are three dimensions of organisational justice. They include: procedural justice, interactional justice and distributive justice.

2. Equity: Employees want to know the organisation is equitable. Equity in this terms means issues like what the organisation makes and what people are being payed. What is the pay distribution between the senor employees and junior employees?

3. One size does not Fit All: An organisation must recognise that it is not one size fits all. Organisations are likely to have more than one generation of employees.  Some organisations have committed the error of believing that the same policies motivate each of the employees across different generations. Take for instance, this organisation that promised the employees who stay till retirement a huge gratuity. This promise may motivate the output of baby boomers because they are already looking at retirement, but this is a very ineffective strategy for the millennials who do not plan to stay for more than 5 years.

4. Opportunity to Alternate Income Streams/Flexible Work Hours: In a recession, some organisations give their employees different opportunities to generate revenue in order to help motivate them.  What may been seen as a conflict of interest in the past will be waved in order to help employees. For instance, some organisations may give their employees an opportunity to work from home, or allow their employees have their own small businesses as long as it does not affect their output and productivity.

5. Productivity Driven Reward: Employers should reward their employees for their performance on certain tasks, this encourages employees especially employees that do highly repetitive jobs. For instance if an employee has a target of bringing 10 clients to an organisation per week, and ends up bringing 20, the employee should get rewarded for this as this increases motivation and productivity. ​

Mar 29
Good Governance In Africa: The Need For Appropriate Leadership Mindset

​Written by Dr Okechukwu Amah

In the printing media and academic discussions, the issue of the leadership problem in Africa is a popular one. Africa has abundance of resources, and is set to be the zone with the highest growth potential and a place of choice in the world. However, this cannot be realised unless the issue of leadership is addressed and resolved. Former American President, Barak Obama, in one of his trips to Africa, instituted the Young African Leadership Initiative (YALI) to train future leaders for Africa. I think this is an indictment on the past and present leaders in Africa, and an insinuation that the young ones must be trained to avoid the endemic actions of past African leaders, that put the continent in its current predicament. I was involved in one of their sessions, and the zeal I saw among African youths is encouraging; this gave me the momentum to think deeply of how the desire of these young men and women for a better Africa in their days can be realised.

The current leaders in Africa are having their ways because of the weak institutions and incapacitated political system unable to offer the check-and-balance required for good governance. For example, an African leader can easily amend his/her country's constitution to allow him/her to stay in office forever because of the lapses in the system. African leaders discard the notion that there is a limit to which an individual can be innovative in a certain situation. People run out of ideas even in organisations when they stay in it for a long time. I may not know the number of years, but it cannot be the twenty and more years that African leaders aim to stay in office.

While reviewing the situation, and studying the pattern of political discussions in Africa, I concluded that Africa can create strong institutions and vibrant political systems, if those in leadership look beyond their narrow self-interest and consider the general good of all. Thus, the logical starting point is to ensure that the young up-coming African leaders understand the appropriate leadership mindset, and are socialised to accept it as the way forward, if Africa must take its proper position in the world. For the purpose of this discussion, I will define leadership mindset as why the leader opted to become a leader. Behaviour drives what we achieve;this relationship is open and can be inferred by all. However, there is a hidden determinant of our behaviour andmindset, which drives the behaviours we enact as leaders. What I intend to do in this discussion is to explain the various mindsets that leaders can have, and to describe what behaviours emanate from each mindset.

The Arbinger Institute1 looked at leadership mindset from a dimension which I label 'who it benefits.' In this classification, you can have internal mindset (benefiting self) and external mindset (benefitting others). A person with internal mindset is in leadership for what he/she can obtain. Some will define self widely to include, may be, village circle, but not more than that. A person with external mindset is in leadership for the legacy that will be left for people. Such a person does not hate him/her self, but he/she knows that leadership is all about making a difference, not in the narrow sense of the internal mindset, but for the benefit of all. Carol Dweck2 also looked at mindset from another dimension which I label 'dynamics'. This classification yields fixed mindset (does not allow for change), and growth mindset (believes that change can occur and must be encouraged). Leaders with fixed mindset believe that issues and situations are fixed and remain so forever. They believe that change comes with high risk that one should not even attempt it. For some of these people, the ruling class is fixed and others should not attempt to enlarge this class, and people should even not clamor for this because of the high risk involved. If forced to give up power, they make it impossible for whoever is there to show that they and their group are superior. People with growth mindset are open to every possibility of change provided the change will produce a better society and self. Such people encourage the search for alternatives that are better than what they are offering. However, I think none of these classifications taken singly explains the dynamics of leadership in Africa. Hence, I combined them to arrive at the classification in the figure below:

​​Screen Shot 2017-03-21 at 1.21.26 PM.png

As much as possible African countries do not want to have leaders who are internal. This is because a person with internal mindset does not respect the big picture. To such leaders, leadership is a status, and followers are slaves that exist to serve the leader and obey his/her commands.  Leaders with internal and fixed mindset (quadrant 4) do not believe that any other person has the solution to a country's problem. They fight to remain in power even when they know there is nothing to offer their country. Leaders with internal and growth mindset (quadrant 3) may encourage changes, but they will only allow the changes that benefit self. If they are forced to release power, they either bring in a crony that they know will continue their destiny or make it impossible for another person to excel so they can prove their superiority over everybody. African leaders are mainly in quadrants 3 and 4 because of the weak institutions and incapacitated political systems. These self-centered leaders are always manipulating both to achieve their selfish motives.

Fixed/external leaders (quadrant 1) care for people, but believe that solution lies in one set of people. They believe that nature has allocated power to some people, and such people must protect it at all cost. They either use political or ethnic affiliation to mark out the boundary of power. When they leave office, they become godfathers appointing only those who are loyal and 'know' the problem of everybody. The weak institution and incapacitated political system create a favorable environment for such leaders to thrive. As a result of the fixed nature of their mindset, they will oppose vehemently any attempt to establish strong institutions and political systems that will be  able to exercise control over them.

The best leaders are in quadrant 2, Growth/external. These leaders care for people and want the best for people. They will support any source of best governance. They believe that one person cannot provide the solution to a nation's problem all the time. They believe that leaders must be groomed and allowed to take the stage. Leaders with growth/external mindset do not stay beyond their tenure no matter what you do or say to them. These leaders have no problem with strong institutions and capable political system, because they would not go contrary to the demands of any.

Unfortunately, Africa is in its current predicament because most of its past and present leaders have always been from quadrants 1, 3, and 4.  What Africa needs in future leaders is the growth/external mindset, quadrant 2. Unless these young ones are directed appropriately, they may end up in the other undesirable quadrants when mentored by the same old brigades. I am advocating that while the youths form coalition, they should bear this in mind. African countries need 'saviors 'and I found in the African youths that gathered for the seminar a desire and hunger to be these 'saviors'. What they need is proper direction and mentoring by those with the mindset in quadrant 2. Mindset is not a stable personality trait that has low probability of change. One can unlearn bad mindset and learn good ones. What the youths require is appropriate training to expose them to the dangers in mindsets in quadrant 1, 3, and 4.

1.The Arbinger Institute (2016). The outward mindset: seeing beyond ourselves. Barrett-Koehler Publishers, Inc.

2. Dweck C.S. (2006). Mindset The new psychology of success: How we can learn to fulfill our potential. New York: Ballantine Books.​

Feb 16
Musings - A Day in the Life of a Female Academic

By Dr Ogechi Adeola​​

Weather Conditions:  Humid, Lagos, Nigeria

Occupation:   Teaching (well, knowledge impartation – theoretical and practical)

New Attributes (Physical): Front hairlines greying, change in eyeglasses prescription. Stress-induced?

Disposition check (Rational):  Jovial (am); Preoccupied (noon), Reflective (pm).

New Year Resolution:  Write more journal articles, Lose Weight, Shop less (in no particular order…)

It was a bright and undramatic Wednesday morning.  Feeling a bit bored, I decided to evaluate the New Year resolutions I had meticulously penned down on January 1, 2017. I was doing quite well on the first two on my list, struggling with the third. Remembering my measures of central tendency, I scored myself an Average using the arithmetic Mean, the Median and the Mode. Not too bad for the beginning of the year! I was writing more, eating less…well, still shopping. Some things just take time, I reckoned consolingly. A wide self-deprecating grin spread across my face.

Proud of my almost 40 days of forfeiting most of the culinary luxuries of life - ice cream, fruit cake, fruit juice, fruit pastilles, yummy chocolate bars and all, I basked in the euphoria. Seated at the breakfast table, I traded orange juice for green tea, calorie-laden white bread for a bowl of Quaker oats and a bar of Mars Chocolate for a handful of Almond nuts. With a belly still rumbling with hunger but 'will' satiated, it was time to prepare for the next class. I walked back to my office calmly without any premonition of the events that will follow shortly after.

A letter just came in the mail. Not the Postmaster kind of mail which is delivered from door to door. No, not a mail in an envelope neatly labelled with the recipient's name and address, placed inside the pigeon hole in the mail section of the ground floor of the business school.  This type pops up in your handheld device, with a distinct sound that announces its arrival, whether night or day. The address looked familiar, and so did the sender. Instinctively, I knew it was not from our climes, it came from far yonder. Did it bring good tidings? I wondered. I took in some breaths, momentarily paused and then I opened it. Well, I clicked on it as I walked on.

It started well, with some nice appreciation for my time (energy?), with some acknowledgement of my output (input?), and some other phrases in the valley of the hills called 'niceties'. Then came the bombshell. The harbinger of disappointing news. An anti-climax of some sort, it was for me...a rejection letter for an academic paper I had submitted since last year. I was quiet for a while, read the 'love' note a couple of times, stared at nothing... and gave little smiles to colleagues that passed by, oblivious of the silent tears welling up inside me. Walked in a mini daze.

I decided to read the email again as I sat at my desk. Perhaps, I missed out some parts. Perhaps, there were some 'alternative facts' I missed out. I read again. Same details as the first time. What was I expecting?

How can I describe my feelings? I had been hopeful. Flashbacks of events of 2016.  I remembered the sleepless nights, the midnight candles, and the endless search for data, the writing up stage and the chocolates I consumed as I worked tirelessly. Yes, I recalled the chocolates, vividly.

I didn't feel like doing anything again that day, I suddenly lost the zeal to put in much effort into that type of research activity, again. I just didn't have the energy to start some work where the outcome could not be predicted. However, a different kind of zeal unexpectedly surged forward. The zeal to binge suddenly returned from its far-flung journey of December 31 as I opened my black handbag and brought out 'my former best pal'. A giant bar of Mars Chocolate – big, black, yummy, foreign (well, 'made' in Dublin). Ever present in the handbag (out of habit), but I was never tempted to nibble, well since the new year.

I pondered. I mused. I reflected. I ate.

Compartmentalising my emotions, I went into the classroom, disposition best described as cheery. The session participants smiled at me, I smiled back as I orchestrated smoothly – with a belly filled with scrumptious chocolate (they could never have guessed!). We discussed the changing landscape due to digital economy - Uber, Airbnb, Amazon, Wakanow – strategies to succeed in the new economy. It was a good session.  Class over, it was time to go home. I made a mental note to replenish my depleted supply of chocolate…Aha!

Nightfall, the weather is cool. Taking another bite of my favourite chocolate bar retrieved from the kitchen pantry, I gradually forgot my New Year resolution as I pondered, yet again on the life of an Academic.The thrills, the highs, the lows….paper acceptances, paper rejections, conference presentations, travels, et al., feelings best described as ambivalent.

Suddenly, I felt an urge to pick up my phone again, a pull from my cocoa-binge-induced pity-party. A WhatsApp message. I clicked open. A friend just sent a quote from Dr Martin Luther King Jr.

              '...Accept finite disappointment, but never lose infinite hope.'

How profound! An Epiphany. Accept finite disappointment? Yes, I will accept the paper rejection and move on. Never lose infinite hope. Yes, there is a silver lining in every cloud. The tides suddenly turned. Once again, I am motivated. I am energised. I will pick up myself again. I will start again. I will work on the paper again, improve on it and resubmit to another journal. Opening the Venetian blinds slightly, I looked out of the window. Lagos skyline looked so beautiful. The clouds had gathered since sunset, and the winds blew cool breeze into my bedroom. Hope arose in my bosom. Like lightning flashing across the sky, two very compelling words 'I will' flooded my thoughts.

I will lift up my eyes to the hills... Psalm 121:1

I will publish more. Yes!

I will still lose weight this year. Yes!

I will not replenish my supply of Mars. A definite Yes.

I will shop less. Well…

Feb 08
Making Good Presentations – The Place of Preparation

Written by Dianabasi Akpainyang

Making presentations is an unavoidable part of life. Whether one is trying to convince parents to get a new pair of shoes, or making a sales pitch to a company's management team about a new product, or teaching a class of students a complicated subject, presentations are part of daily routine. With formal presentations, the need for effectiveness cannot be underscored. For a presentation to be good and effective, the presenter should of necessity, commit to adequate preparation and this holds true even for spontaneous (off-the-cuff) speeches common with government officials and top business executives.

The Need for Preparation

According to Dale Carnegie, "a well-prepared speech is already nine-tenths delivered." Consider also Abraham Lincoln's famous statement: "If I had six hours to chop down a tree, I'd spend the first four hours sharpening the axe", and you would realize that even some of the greatest orators to walk the earth valued the task of preparing well. Effective and adequate preparation is the lifeblood of successful presentations. It is the largely unseen proverbial drummer that beats away in the nearby bush while the happy bird dances brilliantly on the foot path. It is the quiet but unyielding force that propels great orators to delight audiences and birth revolutions. It is from the activities of the 'dark closets' of preparation, that podiums are lighted with candor, confidence, charisma and creativity.

Five Tips to Help You Prepare for Your Next Presentation

1.     Make out Time to Gather Information

Successful presentations are products of intense search and discovery of relevant information. Experts call this 'brooding over the topic'. Amazing orators like Abraham Lincoln confessed to the 'magic' that proper information gathering can do. Whether you are preparing to face an interview panel for a new job, or a committee to defend your contract proposal, or preparing to deliver some moralistic preachment to a congregation; in-depth information gathering should be a necessary first step to success. As you sit in silence in the car, bus, train or airplane, or as you lay on your bed during those still, silent moments before you drift away to sleep, you should think about the topic and write down striking thoughts. Use the internet, gather information from relevant print materials, and listen to people who would provide valuable insights, pay attention to underlying messages from events, widen the subject, enlarge the mind, push beyond the limits and be outstanding.

Having the right information on a subject does not only boost the presenter's confidence on stage, it also makes the audience feel a sense of fulfillment and satisfaction, especially if new and useful information which translates to learning is provided.

2.     Preach to Yourself

This is my coinage for reflection and deep contemplation; the necessity of the presenter to get deeply immersed in the message until it becomes 'his own.' Failure to first get absorbed and engrossed in your message makes you inauthentic and at best, academic. Research has shown that people are unconsciously drawn to a speaker who they feel has a real message to deliver in his head and heart and zealously desires to communicate that message straight to his listeners' heads and hearts. Preaching to oneself breeds belief and inspires passion for delivery. If the message is not understood, internalized and accepted by the messenger, one would not be surprised when a somewhat aloof and mechanical presentation activity is put forth.  

3.     Analyze Your Audience

Considering in advance, the peculiarities of your audience, is critical to success in presentations. Take time to decipher their needs. Find out the number of people you would be talking to, the time (before or after a meal?), their age range, professional standings (where necessary). Anticipate audience reaction and prepare to manage them. Some listeners would appreciate humor from time to time; some would consider you unserious or a time waster if you breach the solemnity of the occasion with what they think is unnecessary comedy. Some people appreciate more visuals than words; some prefer statistical analysis tools – graphs, tables and charts than sentences or pictures. Some appreciate bullet-point summary of the message. The mindset of your audience is important too. Speaking to a group of philosophers who may generally question most statements you make requires a different approach to delivering your best friend's toast at his wedding.

4.     Practice Delivery - Rehearse Aloud

'Practice makes perfect' is not just a worn-out cliché, it is an eternal call to duty in all spheres of life. Why would football players spend five days in rigorous training and strenuous exercise regimes only to run around the pitch chasing a ball for 90 minutes? How about other athletes, musicians, and so on who spend weeks and months to rehearse only to perform for a short time? Rehearsing a presentation the way you will deliver it is highly recommended by experts. Stand, move around, envision your audience, call out the words and act out your script in advance. This will not make you look inauthentic; it would rather serve as needed reminders when you step on that stage. Your mind would play back those moments, and echo those words as you said them in your room and you will have an easier time delivering the goods on stage.

Going through your presentation the way you would deliver it on stage would also help you restrict yourself to acting within the boundaries of allotted time. You do not want the surprise of discovering that you had run out of time just mid-way into your talk. This can dishearten as well as embarrass you. 

5.     Seek Constructive Criticism

As part of your preparation process, you should seek constructive feedback from colleagues, friends and family members. If possible, rehearse before someone who would be candid with feedback. You can subscribe to a speaking/communications club and make use of the feedback mechanisms of such groups. You may record videos of yourself rehearsing and forward to group members who would watch and criticize. You could send a copy of the presentation to experts to dissect the content and make comments. Integrate feedback and garnish your presentation to suit your audience and your style. At the end of the day, it should be your presentation by you!​

Oct 06
Spontaneous Deregulation Tests Regulatory Gaps in the Digital Economy

written by Austin Okere

Just recently, I facilitated a seminar for the Lagos Judiciary at Lagos Business School with the theme Digital Economy and Legal Regulation. The aim of the seminar was to share insights on the emerging digital economy with their Lordships, and draw attention to the imperative for regulatory evolution in the face of the pervasiveness of online platforms of the kind operated by technology giants, such as Facebook, Google, Uber and Airbnb. There is hardly an area of economic and social interaction these days that is untouched by these platforms in some way.

The Regulatory Gaps

To fill the regulatory gaps in the digital economy, these behemoths have resorted to what could be referred to as spontaneous deregulation. I first encountered this term in an article by Benjamin Edelman and Damien Geradin, and has arisen as a result of digital disrupters ignoring laws and regulations that appear to preclude their business model, which is typically based on providing platforms for crowd sourcing and giving rise to the sharing economy. Believing in the efficacy of their utility model and its appeal to a pent up global demand, these disrupters seem to see many rules and regulations as belonging to the past and impractical for today's innovative clime. They, therefore, simply ignore them, opting for their own version of self-regulation, usually based on a mutual rating system between service providers and consumers. It is this skirting of existing regulations that is referred to as spontaneous private deregulation.

These disrupters make the rules for themselves as they go along because, in fairness to them, as their platforms reshape markets, the scope of activity subject to regulation tends to decrease, and various forms of protection disappear. These companies operate in interstitial areas of the law because they present new and fundamentally different issues that were not foreseen when the governing statutes and regulations were enacted.

Two major areas in which these digital behemoths  have riled the establishment are in transportation and hospitality; the major 'culprits' being Uber and Airbnb. Uber, until recently a relatively unknown company out of Silicon Valley in California, employs 160,000 drivers today and is adding an average of 20,000 drivers every month. This transport services disrupter is now valued at $41b, and operates in many major cities across the globe. Airbnb, a previously obscure company with similar roots and reach, has over 1.5m accommodation on its platform, and is now valued at $25b.

The Need for 'Platform Fairness'

Axelle Lemaire, French Secretary of State in charge of all things digital, insists that France is open to platform operators, but consumers have to be protected. She is sponsoring a law to be passed by the French Parliament which will create the principle of 'platform fairness.' Karnataka State in India, where Uber piloted its India service two years ago, has directed taxi aggregators, such as Uber, to stop operations in the State until they secure a licence from the government, triggering sharp reactions from the corporate world. Getting a licence would mean no more surge pricing, complying with the maximum fares fixed by the government periodically and registering with local transport authorities. The question is" why has it taken the Karnataka government such a long time to wake up to regulatory gaps in her transport sector?" And how many other cities are in this quagmire?

The United States Supreme Court recently ended a decade-long battle over Google's massive book-scanning project, declining to take up an appeal by authors who claimed the company violated copyright law ''on an epic scale.'' The justices denied certiorari in Authors Guild v. Google, 15-849, leaving in place a ruling handed down last year by the United States Court of Appeals for the Second Circuit that said Google's project was permissible. The appeals court decision invoked the ''fair use'' doctrine, which permits some ''socially beneficial'' use of published works, such as news reporting or research, which would otherwise constitute copyright infringements.

Airbnb has had its fair share of issues with one of its largest markets, New York. A major concern is the legal regime within which Airbnb operates; one which is marked by poorly drafted laws that fail to account for challenges presented by the sharing economy. As explained by Airbnb cofounder Brian Chesky, "There were laws created for businesses and there were laws for people. What the sharing economy did was create a third category: people as businesses," to which the application of existing laws is often unclear. These new business models raise complex questions that have not yet been addressed by either legislatures or courts.

Because the threat of enforcement actions can have a chilling effect on start-ups and their users, state and local government officials should consider how their actions may affect burgeoning businesses. Officials should encourage the sharing economy's growth through collaborative efforts rather than seek to protect incumbent businesses.

Regulation Seems Too Slow in Catching Up

The slow pace of regulation evolution seems to strongly suggest that the legal profession itself is ripe for a technological revolution that will optimise the largely manual and laborious process of enacting laws and regulations in the face of the aggressive pace of digital innovation.

I recall the indignation of their Lordships when I cautioned that the learned profession could be more vulnerable than they think when it comes to disruption, and that emerging technologies like cognitive computing and other forms of machine learning can help narrow the gap between regulation and innovation.

Much as it may sound improbable, given its intrinsic consultative nature, I was not surprised when I came across an article on the World Economic Forum's collaborative platform, announcing that a Law firm, Baker & Hostetler, had done just that!

Green Shoots of Technology in Law and Regulation

According to the article, Baker & Hostetler has announced that it is employing IBM's AI, Ross, to handle its bankruptcy practice, which at the moment consists of nearly 50 lawyers. Ross, "the world's first artificially intelligent attorney" built on IBM's cognitive computer, Watson, was designed to read and understand language, postulate hypotheses when asked questions, research, and then generate responses (along with references and citations) to back up its conclusions. Ross also learns from experience, gaining speed and knowledge the more you interact with it."You ask your questions in plain English, as you would a colleague, and Ross then reads through the entire body of law and returns a cited answer and topical readings from legislation, case law and secondary sources to get you up-to-speed quickly," the website says. "In addition, Ross monitors the law around the clock to notify you of new court decisions that can affect your case."

Ross also minimises the time it takes by narrowing down results from a thousand to only the most highly relevant answers, and presents the answers in a more casual, understandable language. It also keeps up-to-date with developments in the legal system, specifically those that may affect your cases. According to CEO and co-founder Andrew Arruda, other firms have also signed licenses with Ross, and they will also be making announcements shortly.

This disruption, happening to the most unlikely profession, with a highly codified ethic, is a clear manifestation that no industry is immune from disruption in the impending fourth industrial revolution. Any industry that does not figure out how to be a part of it might as well write their obituaries. My takeaway, expressed to their Lordships after the seminar, was that the digital revolution is like a train whose drivers are the entrepreneur disrupters. The passengers are the global customers with a pent up demand for the value and convenience that they provide. Naysayers to this phenomenon can stand in front of the train and be crushed, stay on the platform and be left behind or come on board for a ride into progressive partnership.

Regulators still have much to learn about how to deal with digital platforms. They have no choice than to get more involved and get the needed expertise. But will they? The jury is still out.

Austin Okere is the founder of CWG Plc, the largest systems integration company in sub-Saharan Africa, and Entrepreneur-in-Residence at CBS, New York. Austin also serves on the World Economic Forum Business Council on Innovation and Intrapreneurship.​

Oct 06
What Do New Autonomous Technologies Mean for Global Business?

What Do New Autonomous Technologies Mean for Global Business?

Amazon aspires to make drone deliveries for its Prime service. Uber, the dominant taxi service for the digital age, is experimenting with self-driving cars; Google, which has been testing self-driving cars for years, is also rumored to have a taxi service in mind. How will new autonomous technologies impact the lives of consumers and shape businesses, and what is the role of governments in shaping them? Global Network Perspectives asked our Faculty, Dr 'Yinka David-West for her perspective.

GNP: How will new forms of autonomous technology—drones, self-driving cars, new forms of robotics—likely change our lives and create new business models?

Dr David-West: New forms of autonomous technologies will certainly have an impact on lives, society and business. As these technologies gradually reduce human-human interactions in favour of either human-machine or machine-machine interactions, we are bound to see changing business and interaction models. While these may ease existing operational and business constraints, their transformative nature also bring about disruptions in some industries and redefine the human capabilities required in others.

Firstly, business processes in service-oriented industries will be challenged to better support growing digital channels and relationship management strategies for the "always" connected customers with ever-changing value propositions. As such, software platforms (and bots) will form part of organisations' critical infrastructure. Secondly, in the case of industrial businesses, hardware advancements in machinery and equipment using sensors and wireless communications networks will become standard. These will lead to the real-time aggregation and transmission of data about the machine or the context in which it is being used as we see with health data and wearables.

In both cases, the increased use of information technologies will result  in a data surge (or overload) that will require analytical capabilities to help business managers draw better insights. In order to effectively harness this data, new organisational capabilities in the field of data sciences and related partnerships will be essential. The changing customer value propositions will demand for agile organisations with flexible product design capabilities to meet customer needs. In addition, new opportunities for operational efficiency, especially in the areas of capacity utilisation and reduced downtime, will also be harnessed.​

GNP: How have new autonomous technologies already impacted businesses working in your country or region? What opportunities and threats do they present?

Dr David-West: The impact of these autonomous technologies varies from country to country in Africa, especially due to the dependence on public infrastructure; a weakness of most sub-Saharan African (SSA) countries. For example, in the Global Information Technology Report 2016, the latest iteration of the Networked Readiness Index (NRI), which ranks technology readiness in 139 countries, shows SSA countries underperforming (see figure 1 for rank performance of SSA countries). Outside of South Africa and Mauritius ranked 65th and 49th respectively, other countries ranked in the bottom half.

While access to public infrastructure delimits impact in SSA, examples of existing opportunities and threats of different technologies are highlighted across industries.

LogisticsThe use of drones for logistics has enhanced delivery capabilities in cities plagued by persistent traffic congestions. This is an opportunity for emerging e-commerce marketplaces. This function transforms the job of a delivery agent from one that requires a driver's license to one that requires navigation skills. This ability has been tested by Nigeria's e-commerce marketplace, Yudala.
WearablesWearables and health tracking applications and devices like FitBit open up new business opportunities for the insurance and healthcare industries. Active monitoring of high-risk patients can reduce patient emergencies that may even lead to death. While these personal monitoring tools collect the data, aggregator health analytic systems from insurance companies are lacking.
TelematicsThe use of telematics in the transportation industry introduces opportunities such as enhanced transportation management, personalised insurance and management services for government, insurance providers and transport maintenance companies respectively.
TelecomsThe telecoms industry which provides a significant portion of SSA's infrastructure is also being revolutionised. In this sector, human data is gradually replacing human voice and messaging which is also threatened by non-human (machine-to-machine) data. Telecoms researchers, Ovum, estimate that by 2020 cellular machine-to-machine (M2M) connections will represent 3.4% of Africa's 1.3 billion mobile connections.

GNP: How are people and governments in your region responding?

Dr David-West:​ Generally, the responses are somewhat lackadaisical. However, telecom companies that are witnessing declining revenues from voice and messaging services in favour of data-oriented alternatives are being forced to review their business models and diversify investments. For example, the South-African MTN Group is a member of the African Internet Group (AIG), an internet platform company and member of the German incubator, Rocket Internet. AIG operates digital platforms across different industries and markets on the Continent.  To further enhance its digital service offerings, MTN has also established ICT startup incubators in South Africa and Nigeria.

Although several African governments are seeking to build digital jobs, governments' ability to understand and develop regulatory guidelines for emerging technologies usually occur after their adoption. ​

Aug 03
Increased MPR: Time to Rethink

An interview with LBS Faculty and Economist, Kelikume Ikechukwu on the recent increase in MPR.

CC: With the new MPR announced by CBN, what will be the implication for businesses?

IK:  First we need to look at why the government decided to raise monetary policy rates, from 12% to the current 14%. In the first quarter of 2016, GDP declined to -0.36% while inflation was also on the increase; inflation rose to 15.58% while unemployment was also rising.  Technically, we have an economy that is entering a phase of stagflation.  There was a need for central bank to check the inflatory pressure. Today, inflation is 16.48% showing that there is a problem. The government has done well by raising Monetary Policy Rate to check further rise in the general price level that is if inflation is driven by monetary phenomenon. The government has thought it wise that the only way they can check or curtail increase in prices is to check inflation raise in MPR rates. The challenge here is that when you raise MPR all other interest rates will rise.  The implication is that the rise in the cost of borrowing will shrink investment. As investment is shrinking unemployment will further rise meaning that government current policy may translate to further deepening of the economy.

CC: What is the implication for the average Nigerian worker?

IK: The average Nigerian worker has lost a lot in the past year; the real income of the average worker has been eroded, at this time last year the exchange rate was trading at below N197. Oil price was trading at N86 per litre. As at today, oil price is N147 per litre, kerosene price is N220 per litre, diesel price is N195 per litre. All of these costs translate to high cost of living, prices are rising, cost of living is rising. The average consumer's income has been eroded, the implication of raising MPR whilst your GDP growth is declining shows that households keeping money in the bank as savings are gradually eroding their cash holding. During periods like this, borrowers are at the expense of lenders, it is not wise for you to keep your money in the banking sector because money is losing value per day even as the exchange rate is rising. Right now the interbank rate is N312, whilst the bureau de change rate is tending towards N400. It means that our currency is eroding so whoever is holding money in naira is losing money.

CC: What advice will you give businesses and individuals on how to cope with this new increase?

IK:  For individuals and businesses this is not the best of times, however, increasingly one should begin to look into short-term measures to deal with the hiccup in the economy. For businesses, interest rate is now high so it is not advisable to do business because of the high cost. Businesses must look for alternative means of sourcing for capital. For households, this is not the time to waste funds and this is not the time to put money in any bank because the money will lose value tomorrow. What you can purchase today, you may not be able to buy tomorrow, because of the inflationary pressure and the exchange rate dynamics of the Nigerian economy.  

The household and the business entity should be pragmatic and dynamic on how they use their funds. This is a time to buy tangible assets, like gold and landed properties because they can be traded in the future for cash.

CC: What practical advice do you have for investors to cope with the increase in MPR?

IK: For investors, when interest rate is rising and bond prices are falling this is the right time to begin to invest in stock and shares. If you look at investment in stocks and shares when the economy is down all macroeconomic indicators are down this is the right time to invest because share prices are at the lowest.  This is the right time to buy bonds because bond prices are falling as interest rates are rising.


Aug 01
‘Recession: Government should develop robust capacity to anticipate’

By Dr Bongo Adi

The cycle of boom and burst recession is characteristic of capitalist economies. It’s natural.Economists largely maintain that once you have the combination of rising prices, falling output, and increasing government borrowing you are on the road to recession.

However, according to a recent work by Robert Schiller and the Nobel Laureate, George Akerlof, recession could also be set off by purely psychological factors induced by pessimistic rumours. This, according to them, is the work of “animal spirits” borrowing from Keynes.

Clearly, we have seen all the signals of recession manifesting in Nigeria: Output is in the negative territory; inflation is spiraling out of control; and unemployment is at an all-time high. In addition to these, we have the contagious pessimistic narratives of doom coming from every corner, inducing individuals to reduce spending. We also have the government’s own confirmed fallibility, imprudence, incoherence and sometimes, outright lies. The combination of these doesn’t inject optimism, rather demotivate individuals, making them cautious and paint a doomsday scenario. This definitely dampens consumer confidence.

Although, the practice is to declare a recession if the economy registers two consecutive quarters of negative growth rate, but technically speaking, if we begin to count the negative growth as soon as the economy begins to contract then it is clear we’ve been in recession since the beginning of this year.Some are of the view that we are in a stagflation – a period of rising inflation accompanied by high unemployment and deleveraging.

The government should stop playing the Ostrich and admit that things are really bad. At least, being honest about the situation rather than allowing the citizens to second-guess them should be part of the remedy. The fault is now theirs and not in the previous administration. I am of the view that the policy inconsistency of this government is worsening the situation.

We say we have floated the Naira and yet we don’t yet see the expected waves in the naira flow. The budget talks about reflating the economy yet the last MPC meeting raised the rates. I guess the policy makers are playing joggle with inflation, exchange rate and reflation. It’s a tough battle and there isn’t an easy way out. Matters would have been easier if the rest of the world weren’t also tending towards recession. But with recession looming all over the world and no hope for oil price picking up, the best the government could hope is to ensure they have robust anticipation of potential consequences of policy actions. That surely would help control the negative fallouts.​

Jul 19
Inflation: Coping Mechanisms for Individuals and Businesses

Interview between Ikechukwu Kelikume, Faculty, Economics and Corporate Communications Team.

CCT:  What is the implication of the announced 16.48% inflation for businesses and individuals?

I.K: The announcement of a 16.48% inflation rate, means that we have officially entered double digit inflation and this is due to a rise in the cost of fuel, a rise in the cost of diesel and a rise in exchange rates.  All of these means that when prices are rising it becomes difficult for consumers to buy. Another implication is that the purchasing power of the household is eroded; whilst for firms a rise in inflation could also mean that inventory build-up is rising, which technically means that firms will cut back on the number of staff.

On one hand we have the firms cutting down on production and the number of staff; on the other we have the consumers i.e. the household, reducing their consumption because of the erosion of their purchasing power. This is because many of these people are out of jobs, many are displaced which creates problems for the economy. Therefore there is a need for firms and households to begin to think through the current state of the Nigerian economy, we need to manage our funds prudently in order to survive the times.

CCT: Is this going to get worse?

I.K: For the next quarter we are expecting a further negative growth of GDP because activity wise we have not done much in Nigeria this year.  The budget was released late so we are expecting GDP to be negative in the second quarter. What this means is it that it is going to be worse in the second and third quarter.  However if oil price remains positive at the estimated 50 dollars come first quarter and second quarter of 2017, and if we are able to solve the security challenges we have currently in the Niger Delta, we will experience a positive growth in our macroeconomic indicators come first quarter 2017, but for now it is going to get worse. 

CCT: What advice do you have for businesses and individuals to sail through this?

I.K: For households and individuals this is the time we say 'CASH IS KING'.  This is not the time to hold your cash in one fat savings account, because every day as inflation goes up, unemployment rises and GDP falls. The value of your funds held in a deposit account is completely eroding, it means that your one million today may not necessarily buy what it should have bought today in two months' time.  My advice is to convert your cash quickly, to tradable or tangible assets for the household and manage your funds prudently by buying only the essentials. This is not the time to waste funds.  For businesses this is the time to be creative, this is the time to be innovative, this is the time to prudently manage resources and to trim down on cost.

1 - 10Next
About this blog
No, this isn't actually my picture. I just haven't gotten around to updating this section. It's good to know that someone is reading every last word though. Thanks!