COUNTING THE COSTS OF THE 2015 ELECTIONS

2015 Elections

It has always been said that democracy is expensive. In making that statement, many people tend to look at the cost of maintaining and sustaining democratic structures or, if you will, the various organs of government which, by the way, include the executive, the legislature and the judiciary.

It is also likely that those who make that statement speak on the basis of the amount that is usually allocated to the Independent National Electoral Commission, INEC, the electoral empire. If I recall correctly, the amount said to have been budgeted for the 2015 elections by INEC was about N75.0bn.

Truly, the cost of sustaining the structures of government is huge. Many Nigerians, for instance are united in their condemnation of the “fat” salaries and allowances earned by members of the National Assembly.

These are the direct costs of democracy that almost every one can point at.

However, now that we have just concluded the 2015 elections, perhaps we could make an attempt to look at some of the cost that may have gone down with the elections. I dare say that it would be near-impossible to quantify this cost.

Where and how does one even begin to count the cost of this election when everything really cannot be expressed in Naira and Kobo? Well, we could try and look at some scenarios.

First, we could look at the time NOT well-spent on official responsibilities by political office holders who ran for or campaigned for those who ran for elective offices in the just concluded elections. It is safe to say that while the campaigns lasted, from the very expensive party primaries right down to the elections proper, many political office holders spent more time on campaigns than in the discharge of the responsibilities of their respective offices. Consider, for instance, the President, serving governors, and serving legislators who ran for election or re-election. These ones are not statutorily required to resign before seeking a revalidation of their mandates. Consider also other public servants who assisted them in their respective campaigns. Work out the time they all spent campaigning. The time NOT SPENT AT WORK will amaze you. In the end, decisions that were not taken at all or that taken late because government officials were on the campaign trail would have cost the economy. How much? I don’t know.
Next, you might want to consider the fact that in an election year, many investors are cautious. They maintain “HOLD” positions in the periods leading to and immediately after elections. As such, decisions that could have benefitted the economy are suspended. A case in point here is the experience of many businesses who are mainly contractors to other companies who were told to “wait till after the elections” by those they do business with. Many of such businesses have not been able to do anything since the beginning of the year. They may have already sustained heavy losses servicing overheads.

The postponement of the election from the original scheduled dates of February 14, and 28 by six weeks to March 28 and April 11 took a toll on businesses. Preparations had already been made. Certain decisions taken, meetings scheduled and re-scheduled and diaries and calendars marked all in preparation for the February 14 date. Then like-play, like-play, we started hearing about possible postponement. And from a distantly possibility, the reality of the postponement dawned on the nation. Appointment had to be cancelled and business decisions put on hold. Monies were lost. How much? I don’t know.

Eventually, the elections came. The nation’s borders were closed for the statutory periods during the two elections. Banks and other institutions closed early to customers on the days before the elections. Many business had to hurriedly close also. Who bears the cost during the period of shutdown?

I know that democracy is expensive to maintain and sustain. The call is, therefore, to find a way not to make it too expensive. Government functionaries and those who take decisions that have impact on the entirety of the country must be mindful of the fact that every decision has a cost. But through proper planning, it is possible to minimize these costs so that businesses are not at the receiving end.

And on a lighter note, it is not only businesses that are affected by such decisions. Individuals are also. A friend shared a joke about a couple who originally planned to have a wedding on February 14, 2015. When their attention was drawn to the fact that elections had been fixed for February 14 and 28, they opted for March 28. By February 7, they started sending out their invitations. Then, boom! Jega announced the postponement. To cut the story short, the guy’s family was then said to have summoned him and tried to impress it on him that maybe, just maybe, God was using the postponement to tell him not to marry the lady. When my friend asked me what I thought about the matter, I coughed lightly, cleared my throat and told him “I DON’T KNOW”!

You can follow this writer on Twitter @ehissman

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THE GALE OF DEFECTIONS – A WORRISOME DEVELOPMENT

The presidential and national assembly elections have come and gone. I was relieved (and I think many Nigerians felt the same way) when President Goodluck Ebele Jonathan of the PDP was reported to have called the APC candidate, General Muhammadu Buhari, on phone to concede defeat.

I thought that it would be nice to have the People’s Democratic Party (PDP) in opposition at the centre for a change.

However, barely a week after those elections, I am beginning to wonder whether there will be a virile opposition at the centre this time around. My worry is predicated on the wave of defections that has hit the PDP. I can no longer count on my finger tips the number of high-profile personalities that have left the party in just one week. The personae range from the party’s former governorship candidates in some states. Perhaps the icing so far is the reported defection of Joshua Dariye and Jeremiah Useni both senators-elect in the just-concluded National Assembly elections. That they didn’t even wait for the new National Assembly to be constituted introduces a new and worrisome form of audacious defection.

I have always known that politicians have no scruples. Like they say, what matters in politics is permanent interest. But what they don’t say is whose interest it is. So, I ask, if what matters in politics is permanent interest, whose “permanent interest” is it? By the time we are done lifting the veil on the “interest”, we would discover that the interest is usually “personal”.

For many who abuse, insult, maim and kill others on behalf of some politicians, you really do not understand the game. When their personal interest is served, you can be sure that these same politicians would unite against you. By the time political gladiators decide to put political differences aside to enhance their personal interests, many of recently-emerged class of social media vuvuzelas will not be in the permutations.

With regards to the wave of defections, irrespective of the reasons behind it, it is worrisome. Democracy thrives when there is a viable opposition to keep the government on its toes. The All Progressive Congress (APC) and by extension, its legacy parties (the CAN, the CPC and the APP) did this successfully for the period it was in opposition. In fact, many Nigerians waited expectantly for the opposition parties’ perspectives every time there was a policy pronouncement by the PDP-led central government.

Those who are currently defecting to the APC soon after the presidential elections are guaranteed freedom of association by the constitution. It would also be impossible for the APC to start rejecting defectors lest it be accused of operating like a secret society. However, those who are currently defecting en masse presumably just because the APC will for the government at the centre come May 29, 2015, are enemies of democracy. Nigerians should watch them for they seek to turn the country into a one-party state. That, my friends, is not healthy.

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AS #NIGERIADECIDES2015, I AM INVOLVED. . . AND SO ARE YOU.

The level of unpredictability of the Nigerian political scene has inched up, not a notch but, several notches higher. In fact political pundits say that the unpredictability in the political landscape has reached an all-time high.

True, the stakes are high.
True, the frenzy is high.
However, the debate is low.
The punches are even lower.

In the first few years following Nigeria’s return to democracy in 1999, it was normal for many to refer to the country as a fledging democracy. I had to find out what “fledging” means and discovered that it came from the word “fledge”. Merriam-Webster Online Dictionary says that “fledge or fledging” means (of a young bird) “to acquire the feathers necessary for flight or independent activity; to leave the nest after acquiring such feathers”.

Interestingly, I don’t hear that expression “fledging democracy” often these days. Could it be that in the light of Merriam-Webster’s definition, Nigeria has now fully developed the wings necessary to fly and has left the nest? Some will nod in agreement. There is also the alternative argument that the ‘fledge’ or ‘fledging’ process was aborted. Again there are those who will agree with this position. My personal opinion is that though we may not necessarily be where we should be as a nation, we definitely are no longer where we used to be. We did leave the nest. But we are not exactly flying. Yet.

This is why some analysts think that this year’s election will mark a defining moment for us as a country. For me though, I do not think that the level of political awareness and sophistication has improved. I also do not think that there are serious campaign issues by the presidential contenders. Neither do I think that many voters will still not vote along ethnic and religious lines. Nevertheless, I do believe that the party that eventually wins at the centre will acknowledge that the election wasn’t the piece of cake it used to be and will, therefore, work a lot harder to ensure that it is returned to power in 2019.

Every Nigerian that is duly registered to vote should go out on February 14, 2015 and exercise his or here civic responsibility. As for those who are whining and complaining whether Goodluck Ebele Jonathan (#GEJ) and General Muhammdu Buhari (#GMB) are the best candidates we could get in a country of nearly 170 million people, maybe you just didn’t know. Well then, it is my pleasure that there are 14 presidential candidates, not 2! Surely, among the 14 presidential candidates, you should be able to find someone that meets your minimum criteria. The candidate you vote for does not necessarily have to win the election. I know who I will vote for. So, I urge you by all means vote for your preferred candidate and vote according to your conscience.

In fact, I think it is sheer hypocrisy on the part of some people who claim the neither GEJ nor GMB meets their criteria. I ask, where were they when Prof Pat Utomi ran for president? Did they vote for Gani Fawehimi when he ran for president? Did they vote for Dele Momodu? When Fela Nikulpo-Kuti ran for president nko? Did they vote for him? Make dem park well joor.

It is my hope that the process through which the political candidates improve with time. Therefore, I leave us with 2 quotes that I consider relevant:

“War is too important to be left to the generals” – Georges Clemenceau (1841-1929)

“I have come to the conclusion that politics are too serious a matter to be left to the politicians” -Charles De Gaulle (1890 – 1970)

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READING CONTRACTS AND AGREEMENTS COULD SAVE YOUR CAREER, BUSINESS AND . . . YOUR LIFE!

Contract 2

We begin the year on a legal note. I am doing this because over the Yuletide season, a friend shared with me a bad experience he had in the course of the year based on a contract he had entered into, a contract he never quite understood. As he narrated his ordeal (eventually an out-of-court settlement had to be brokered), I felt I would be a bad friend if I didn’t share with you all the dangers of signing a contract without first reading or understanding the terms of such a contract.

I know that many Nigerians do not take the pains to read or understand contracts or agreements. This behaviour goes all the way up to those who run the affairs of this country. Was it not last year in the thick of the Academic Staff Union of Universities’ strike that a highly-placed Nigerian came out to blame those who signed the agreement with ASUU for not understanding what they signed? I know that such a statement is debatable. He was either right or being mischievous. What is however clear is that it is critically important to understand agreements before signing them.

Now, let me issue a caveat: I am not a lawyer. Like a friend of mine would say, “I was not even beckoned, let alone called”.

But be that as it may, there are things that make sense. And it makes great sense to read a contract before putting pen to paper.

What I really do not understand is why a man would sign a document he does not understand and has not sought legal counsel on. I hear that a lot. “Oh, I didn’t read it at all.” Or, “I didn’t really understand it”. By simply signing the dotted lines indicated, many have made very grave mistakes. Especially in my country, Nigeria.

How do I say this? Never sign a contract you have neither read and understood nor have it explained to you by a lawyer. Any contract at all. That includes an employment contract!

That’s right. Many young graduates, having waited for so long to get a job, do not even bother to read the offer letter before they sign. Difficult times are what they are: difficult times. They should not rob us of our common sense. The reason I’m asking you to make sure you have read and understood every contract before you sign is that your not reading first can come back to haunt you!

Why should you read a contract document before you sign? Well, you should not for the following reasons:

1. ONCE A CONTRACT IS IN FORCE, IT GENERALLY CANNOT BE ALTERED UNLESS ALL THE PARTIES AGREE.

2. AND, WITH VERY FEW EXCEPTIONS, CONTRACTS CANNOT EASILY BE BROKEN.

3. WHEN A CONTRACT IS BREACHED AND RESULTS IN LITIGATION, IT CAN PUT A LOAD OF STRESS ON YOU

4. WHERE THERE IS NO LIABILITY LIMITATION, THE ENSUING CLAIMS AND DAMAGES THAT RESULT COULD CONSTITUTE A DRAIN ON YOUR RESOURCES

By the way, a contract may be broadly defined as a mutually binding and enforceable agreement between two or more parties to do – or not do – something. According to http://www.lawhandbook.org.au, a contract consist of four essential elements:

• There must be “offer and acceptance”

• There must be “intention to create legal relations”

• There must be “consideration”

• The parties must have “legal capacity” to enter into a contract.

On daily basis, there are several contracts we enter without even knowing or recognizing that we have entered into a contract. Signing a receipt after using you credit/debit card is an example. What that simply means is that the bank agrees to pay the vendor and you agree to pay the bank. For many of you that have ever bought an air ticket, how many of you can confidently say that you ever took out time to read the “Conditions of Carriage” attached to the ticket? Not even lawyers do that. Yet, that is a contract, nonetheless. Of course, I am also aware that many sign tenancy agreements without bothering to read them. We are just interested in the keys to the property so we can “move in”.

And oh, I must also not fail to mention that today, we also enter into contracts online when we click on the “I Agee” button. Very often, we do that when we open those free e-mail accounts (yahoo, g-mail, hotmail, etc.), open social network accounts (Facebook, Twitter, LinkedIn, etc.) or make purchases online. By clicking on the “I Agree” button, we are bound by the conditions of use of that service.

I know it is not easy reading a contract document. Typically, it contains so much of legalisms and leaves the non-lawyer confused. However, the website http://www.lawyers.com helps us with explanations of some legalisms you’ll most likely find in several contracts:

• Integration (or Entire Agreement) Clause. Basically, it means the contract is the complete agreement between you and the other person. What you sign is what you get, regardless off what you talked about before signing the contracts.

• Liability Limitation or Waiver. This may work a couple of ways. For one, it may protect either a seller or a buyer if he breaks or breaches the contract. The clause may specify a dollar (naira) amount the person owes the other if the contract isn’t honored. For instance, most employment contracts in Nigeria stipulate that one month’s salary in lieu of notice. That’s a liability limitation.

• Arbitration Clause. Generally, this means that if you and the other side have a disagreement about the contract, you both have to let a neutral third party – an arbitrator – try to settle matter before you may file a lawsuit.

• Force Majeure Clause. This is common in business contracts. It protects both sides from having to pay damages if either is unable to complete the contract because of an act of nature. For instance, if you agree to ship fresh produce to a buyer in another state but an earthquake makes the roads impassable, the buyer can’t hold you liable for damages for not delivering the produce.

• Assignment Clause. This is common in many contracts, such as leases, loans, and business contracts. The clause either bars (or lets) either side of the contract from transferring the contract to someone else.
So, as a rule, Jason Alderman in this article here helps us with what to do before we sign a contract:

• Ensure that everything you were promised verbally appears in writing.

• Make sure all blank spaces are filled in or crossed out before signing any documents –including the tip line on restaurant and hotel bills.

• Don’t be afraid to ask to take a contract home for more careful analysis or to get a second opinion. A lawyer or financial advisor can help.

• Don’t be pressured into signing anything. If salespeople try that tactic, walk away. (Be particularly wary at timeshare rental meetings.)

• Keep copies of every document you sign. This will be especially important for contested rental deposits, damaged merchandise, insurance claims, extended warranties, etc.

• Take along a “wingman” if you’re making an important decision like renting an apartment or buying a car to help ask questions and protect your interests.

• Be wary of “free trial” offers. Read all terms and conditions and pay particular attention to pre-checked boxes in online offers.

So, there you have it people. It’s a new year. And even though it sounds like straight out of a condom advert, be protected.

You can follow me on Twitter @ehissman.

WELCOME TO 2015

Hi folks,

This is to say “Happy New Year” to you all.

I would also like to thank you you for always taking out time to visit this blog and read my write-up even though I have not been consistent.

I do hope to be able to take out time to share my thoughts on issues more frequently but would also appreciate your feedback when I do.

Before I log off, please permit me to share some thoughts on #Ebola. I know that many around the world are relieved that 2014 has finally gone. For most of 2014, the world came under the fear of #Ebola. By the time 2014 ended, over 7,300 had perished from #Ebola. Though the threat seems to have reduced a notch, until the scourge is completely eliminated, the world will always be under threat.

So, my appeal is simple. Let us not think that since 2014 is gone, @Ebola has gone with it: it hasn’t. We must, therefore, carry the fight against killer diseases like #Ebola and #HIV into 2015.

Let’s make it a Year 2015 to remember.

You can also follow me on Twitter @ehissman.

NIGERIA: AGAIN, CAUGHT NAPPING BY THE OIL PRICE SLUMP

I am not very happy at the moment and I just want to get this matter off my chest.

This is about Nigeria and its leaders who did nothing to prevent us from being caught up in the (previous and current) oil price cross-fire.

As you may or may not know, the international price of crude oil had been on a steady decline since June 2014. This Wednesday, December 3, 2014, it touched roughly $70 per barrel. For anyone who has followed the energy market since 2011 when US energy firms announced substantial progress in shale fracking, this current oil price regime should not have come as a surprise. But for many Nigerians, including those in authority and those saddled with the responsibility of managing the economy, we are sounding bemused.

If not for anything, it should be clear to anyone with a sense of economics that commodity prices fluctuate. Crude is a commodity. Therefore, oil prices are no exception to this rule.
It does in fact seem that in Nigeria, we make deliberate effort not to learn from history. Truly, if we did, we would have known that these days of plummeting oil prices would come and we would, therefore, have taken serious measures to cushion the economy from the impact of a southward oil price trajectory. Just about six years ago, we experienced the same sharp drop in crude prices when the average price of crude oil dropped from an all-time high of about $140 per barrel to about $40 per barrel. That was in 2008 during the then Global Meltdown.

The Nigerian economy being a monocultural one that is largely dependent on crude is always going to be at risk. The risks include:
• A risk of fall in production
• A risk of fall in demand
• A risk of fall in price
• A risk of run-out of reserves
In the last few years, we have managed to add another home-grown kind of risk: the risk of theft of crude which in turns leads, not a fall in production, but of revenue.

What beats me in all these is that in the last 30 years or so, political leaders have mouthed the rhetoric about diversifying the Nigerian economy. We all know the drill. Every year or quarter or whatever other period that suits us, our “experts” gather at symposia or workshops or some other fancy gathering to restate the need to diversify the economy. Government functionaries or public servants attending such events tell us that all the right things would be done. Then we go back home and do nothing serious for the economy.

Yet with all the conferences, workshops, seminars or symposia, the economy has remained dependent on oil. So dependent are we on oil that the bases used every year for budget preparation are the price of crude oil and the volume of crude produced per day. The inference to be drawn here is that we can have all the conferences and workshops in the world but if there are no definite actions by political leaders to steer the economy away from exposures, we haven’t done anything. This is a challenge that requires a sustained strategy to deliberately stimulate the other sectors of the economy.

However, more often than not, the reactions of our economic handlers to oil price fluctuations have been reactive rather than proactive. Why? It is simply because we never plan or prepare. It is either there is no depth of thought or there is no will from the leadership or both.
When the oil price hit $76 per barrel about two weeks ago, the official reaction was that the budget benchmark would be reviewed to about $73 per barrel. After the oil price moved to about $70, I heard talk of the budget benchmark being further reviewed to about $65. With the benefit of hindsight, we could have saved a lot of money for this rainy day. But we didn’t. Attempting to peg budget benchmark at $65 would still be too risky considering this report. I would personally recommend a $35 per barrel. If there is any excess over that figure, it could be saved and used to grow the other sectors like power and manufacturing.
This is 2014. Next year will be 2015, an election year. In a nation where leaders and those aspiring to lead are held accountable, we would be grilling political aspirants on what they would do to fix the oil- and import-dependent economy. In the murky waters of Nigerian politics, however, this would not be so. Rather, the build-up to 2015 (as has been seen) will be dominated by mud-slinging, religion and (aha!) Boko Haram. Sadly, the economy will assume a backseat.

In the meantime, with the market already being up-ended by the oil price bloodbath (it is a bloodbath, as you can see from here), we should have outlined very clear steps to cut down on the cost of governance. So far, nothing concrete has been said about that. One or two ministers have called for belt-tightening measures. Interestingly, this has come from two female ministers who I do not think use belts judging from their dress code at public functions.

Like I have been told this is Nigeria where, according to the old French proverb, “the more things change, the more things remain the same”.

You can follow this writer on Twitter @ehissman.

Listen Up, Business Owners – Here’s How To Make Your Employees Productive

I love my job

In the last couple of weeks, I have received several complaints from several entrepreneurs bordering on employee productivity. Many have been full of lamentations. Most of them were very specific. They claimed that many employees are:

  • Lazy
  • Tardy
  • Lack initiative
  • Do not show sufficient commitment to their employers
  • Are unproductive.

This sounds almost like straight out of that Douglas McGregor’s book, The Human Side of Enterprise, where he wrote his famous Theory X and Theory Y article.

One even told me that I was lucky to always have a wonderful set of employees around me.

Well, I admit that I have had tremendous cooperation from a lot of the teams I have worked with over the last 15 years. But raising the right kind of team is a tough job for any entrepreneur or supervisor. I have been an employee and I have also been an employer also. I have worked with very great subordinates and I have I also encountered loafers in the workplace. So, I know what my friends feel.

It is not at all surprising that the complaints that I have received are mostly from small business owners. Most large and structured organizations seem to have successfully devised measures to keep these complaints at a minimum.

So, here’s my list of some key areas that small business owners should focus on to save themselves from curse of poor employee performance.

  1. Get Your Staffing Right – That’s The Foundation: This is all so obvious. However, it is usually overlooked by many business owners. Maybe not deliberately. The rule is that if you do not get the right person to fit the right role, you are in for a very frustrating experience. To get this right, you will need to have an effective recruitment process in place. Not many small businesses have processes in place. Not many can afford to. Not many small business owners even understand that selection, recruitment and placement are specialist functions. So, every business owner thus thinks he can decide on whom to recruit.  Now, if your business is too small to have a specialist HR function, there are two things you can do. You can undertake a 3-day course on HR Selection, Recruitment and Selection or you can ask a consultant for help.
  2. Set and Communicate Clear Goals: I have found out that many employers ask employees to assume roles without a clear set of deliverables from the roles and without communicating the expectations. Employees are more likely to perform better when they have a clear idea of what is expected of them. That’s the whole essence of a Job Description. Beyond the job description, however, it is important for an employer to continuously talk to his employees.
  3. Provide Appropriate Work Tools: It breaks my heart when I see or hear employers complain that an employee is unproductive only to find out that the employee has not been provided with the appropriate tool or equipment required for the job. There is nothing an employee finds more frustrating than not having the he tools or equipment to do their job well. What is required could be a chair, a table, a computer or some personal protective equipment. And dear Sir, the employee does not have to pay for the tools he needs to work for you! I was aghast when someone mentioned a particular organisation that gives employees laptops to be able to do the jobs they were employed to do and deducts the cost of the laptops from the employees’ pay!
  4. Train, Coach and Mentor: Quite often, I hear employers telling nearly-recruited employees that they must “hit the ground running”. My take on this is that even when you expect a top-level employee to “hit the ground running”, you must give him the right “coordinates”.  Part of the process of giving the right “coordinates” is the induction or on-boarding process. Many will require some structured trainings before they settle fully into their roles while other will require some “hand-holding” for a while. The message is that you must invest in your people and provide coaching and mentoring for most productive outputs.
  5. Monitor Performance and Provide Feedback: Every employer should have a performance management and feedback system that lets employees know how well or badly they are performing. It is equally important for the feedback to be specific about what they are doing or not doing well. Such appraisal must be objective, constructive and timely.
  6. Reward Your Employees: Rewarding your employees can be a great motivation factor. Truth is, everyone likes to be appreciated. When you do reward people excellence, chances are that they will keep striving for excellence. Rewards often take several forms. Know which is appropriate and commensurate with the effort and apply it.
  7. Pay Your Employees Adequately: I was going to lump this up with the last point but thought to treat it distinctly because of its importance. Many years ago, while still doing my mandatory national service, I came across an advert that read: “Any company that pay’s peanuts will end up with monkeys”. That is so very correct. Many business owners pay their employees very poorly but live very loud lifestyles. Your employees are not dumb. Believe me, they know when the business is going through a rough patch and when business is good. Sometimes, the pay in some organizations is just not up to scratch. Compensate them well. You can have 3 well-paid and motivated employees instead of 10 poorly-paid and consequently unproductive employees!
  8. Lead By Example: The work ethics of an employer or a supervisor will eventually rub-off on the employee or subordinate.  A disciplined employer who works hard is always a great motivating force for his team. Many on his team would begin to mirror him. The reverse is also the case.
  9. Engage Your Employees: It is always very important to continually engage your employees and to communicate with them. Where appropriate, it would be proper to consult them, share the company’s goals and successes with them and make them have a sense of belonging.
  10. “Loose Him and Let Him Go”: Most employers I know hire to retain. It is hardly ever the intention of a rational employer to hire someone just to fire him. Sometimes, however, it does not work out and at such times, an employer requires courage to cut such an employee loose for the sake of workplace harmony or peace of mind. No employer should have any qualms firing an unproductive employee who has been given all that he requires for the job. And once the decision is made, it must be executed without delay.

So, over to you.

You can follow this writer on Twitter @ehissman