The Chief Executive Officer of UT Holdings, Martyn Mensah has called on business owners and entrepreneurs to develop succession plans that will allow their companies to survive even after exiting as CEOs.
According to him, any enterprise that cannot survive beyond its founder is an indication that the management team did not look beyond the owner manager to make the enterprise a legacy.
Speaking to Bernard Avle on the final edition of the on-air series programmes of the Citi Business Festival, Mr. Mensah stated that a good succession plan will sustain businesses and avert the situation where family members fight over the enterprise after the death of the founder.
“The entrepreneur sets up a business; they grow it in a certain way by themselves. At a certain stage when they can afford they engage external parties to advise them, the question I always ask is beyond the founder of the enterprise or entity, is there hope?,” he asked.
According to him, the challenge comes from the perception that business owners are indispensable, infallible and perpetually relevant.
“One must carefully manage this. You must say to the owner manager that the succession is clear not just for the good of the owner manager but for the good of the entity. Let us make sure that there will be no family fights while you are gone. Let us look at companies like Unilever and others,” he said.
Citing some companies in India as example, Mr. Mensah stated that some firms such as TATA and Mittal began as family companies but have grown and survived beyond their owners due to clear succession plans.
“India is just like Ghana when it comes to family business and they are making a lot of efforts in applying the theory of succession, and the theory of longevity to setting up structures, trust and all that so that whether or not the owner manager is there the organization will survive and stand the test of time,” he pointed.
He observed that there are many enterprises in Ghana that have no succession plans after the exit of their founders, hence bound to collapse in the future despite doing well now.
Building world class leaders to take over
Responding to how to develop world class corporate leaders to take over from business owners, Mr. Mensah pointed out that the first thing to lookout for is problem definition.
Using how engineers frame problem to find solutions to them, he stated that it is important to properly define the problem.
“If you look around the world a lot of engineers are sitting as corporate leaders. The reason is that it is how they frame problems. A non-engineer will say what are we solving?, an engineer will say what are we solving for?,” he said.
He explained that the addition of the word ‘for’ gives the solution a purpose.
According to him, if solving a problem will not give it a purpose, then it requires no solution.
Touching on the second point required to develop corporate leaders, Mr. Mensah bemoaned the lack of confidence among most Ghanaian managers.
“I am shocked and stunned at the lack of confidence among managers today. A manager can ask you how can I go forward in my career?, how did you make it?. That sounds strange to me”, he stated.
According to him, managers must be confident and empowered to take on challenges.
He blamed the lack of confidence on the cultural setting which coerces everybody to go by what have been established without challenging the status quo.
Using education to change minds
Explaining how to implement the solutions, Mr. Mensah maintained that people must be educated from the formation period to build their confidence.
He stated that until the system of education is changed, the educational system will always produce leaders who may not be ready to challenge the status quo to develop new ideas.
By: Lawrence Segbefia/citibusinessnews.com/Ghana