When lack of continuity plan destroys a business


RHODESIA had a repressive system that deprived Africans opportunities to thrive and eke out more than a living.
But Africans, Zimbabweans, descendants of the builders of the great houses of stone, found ways to establish and assert themselves in the difficult times.
Hence, in that Rhodesia, were successful African businesses.
Browsing through the book Prominent Personalities of Rhodesia, a compilation of excelling black businessmen who defied the odds and made it in racist Rhodesia, one is overcome by joy which quickly transforms to melancholy when one begins to question where these businesses are today.
The businesses that flourished include Bulawayo’s Happy Valley Hotel, Pelandaba Road Services, Mboma Super Buses of Highfield, Harare, Rutendo Bus Service, M & A Special Bus Service, Farayi Uzumba Buses and Stores (which had a chain of businesses such as general merchants, butcheries, a bottle store, supermarket and filling station) and the list goes on.
Fast forward to 2016; if one is to ask how many of these businesses have survived to the second and third generation, sadly just a handful. Many a business has crumbled upon the death of the founder, whose business vision is seldom communicated to kith and kin for various reasons.
Most will be quick to mention; it is always the children to blame for running down their fathers’ businesses, particularly the sons who are quick to adopt lavish lifestyles and go on spending sprees, missing the basic tenets of business.
Unfortunately, most of this is true as examples can be drawn from almost any neighbourhood in Zimbabwe of once thriving businesses rundown by irresponsible progeny.
As a people who are continually engaged in an endeavour to find solutions to their current problems, some have not bothered to study the causes of African businesses’ failure, rather preferring to rope in the spiritual dimension by saying ‘chemufi hachigari, chinoteera muridzi wacho’.
But is that really the truth, that African businesses have a spiritual bond with their founders?
If that is so, then if the vision of the original founders was for their businesses to grow to posterity, can they not steer their businesses to success from the yonder world if you really want to believe that businesses have a spiritual link with their founders?
And why is it that European, Asian, Jewish and Indian businesses have been retained within families for centuries on end?
Professor William O’Hara, in his book Centuries of Success, posed the rhetorical question: Is there any institution more enduring than the family firm? He answers: “Before the multinational corporation, there was family business. Before the Industrial Revolution, there was family business. Before the enlightenment of Greece and the empire of Rome, there was family business.”
Among the oldest known family businesses is Japanese temple builder Kongo Gumi, founded in 578AD.
A brief history of this business would be in order.
More than 1 400 years ago, Prince Shotoku contracted the Kongo family members, whom he brought from Korea to Japan, in order to build the Buddhist Shitennoji Temple, which still stands to this day.
After the completion of that project, the Kongo Gumi family continued with their line of business, constructing many famous buildings over the centuries, including the world-famous 16th Century Osaka Castle in Japan.
The Kongo Gumi business empire still dominates serious construction business in Japan today, continually repairing and building religious temples.
Currently, the Kongo Gumi empire is headed by Toshitaka Kongo and next in line to take over the company is his son, Masakazu Kongo, who is patiently waiting in the wings to take over the reins of their family firm.
The family firm is thus central to Japanese business culture.
Then why have we failed as Africans to have businesses that transcend generations.
According to academics, it is regrettable that while Zimbabwe is pinning its hopes of economic revival on Small-to-Medium Enterprises (SMEs), which are mostly family-run firms and are a proven engine – driving economic growth in emerging market economies, the facts on the ground signal a sector lynched by poor business succession planning which inhibits the business’ prospects as a growing concern.
It is common knowledge that sooner or later, comes a time when the founder voluntarily retires or is forced by extenuating circumstances to transfer ownership of the business. The failure of the business mostly occurs when management and control are handed down to the next generation, which in most instances is far removed from the original founder’s vision and fail to read from the same template with their predecessors.
The inheritors cannot be blamed for being irresponsible; they have not been steeped in the lore and laws of the business they inherit.
This is one of the major reasons African businesses have failed to last for generations.
Most African businesses, particularly the SMEs, do not have a continuity plan in place.
Simply put, a business succession plan is the process undertaken by business owner-managers to hand over the reins of their firm to succeeding generations.
For most African businessmen and businesswomen, the subject of continuity planning in a family business is a thorny issue.
So contentious is business continuity planning that the majority of businesses are clueless as to what to do in the event the founder dies or is forced to leave the business for one reason or another.
This is obviously due to a number of reasons, which include cultural beliefs surrounding discussion about planning life after one’s death.
In some cases, it is even regarded as taboo to broach the subject to the business founder.
One will be chided for wishing bad on the founder, kumushurudzira rufu.
Such a discussion can easily be mistaken as ‘kurongera rufu’, and this has been cited as a major stumbling block to the continuity of the family firm.
Some have also come out guns blazing, accusing most SME founders and owner-managers of following archaic traditional practices where the business is succeeded by a family member, regardless the successor may not possess the requisite skills and expertise to drive the business.
Rivalry among family members after the demise of the founder has also led to the decline of businesses.
Clearly all the squabbles, the lack of direction and vision that cripple businesses can be avoided by a continuity plan.


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