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Nigeria lacks industrial development policy, says NIPM
boss
Dr. Niyi Opanuga is the director general, Nigerian
Institute of Production Management (NIPM). He has MBA, Mtech and a Phd in
Industrial Ergons. He is the national coordinator, Nigerian Institute of
Maintenance Management (NICEMA); chairman, National Coordinating Committee,
Institution of Stores, Materials and Logistical Management (ISMAL) and has over
a 100 published works. He is the publisher of Production and Management Review,
Journal of Production and Operations Management, Maintenance Management in
Nigeria, among others. He has worked in the education, manufacturing,
agriculture, construction, banking and finance sectors as manager and
consultant in the last 20 years and he is on the board of several organisations
including the Optimum Resources Group, where he is currently the chairman. In
this interview, Opanuga speaks on manufacturing standards in the country as
well as industry issues bothering production management in Nigeria, writes Emma
Okonji
What is the vision of
the Institute of Production Management?
Nigerian
Institute of Production Management (NIPM) is a Federal Government registered
professional body that regulates the practice and operations of production
management in the country. We manage all the sectors of the economy, be it
production, manufacture, oil and gas, construction, among others, and our
vision is to grow and develop production processes in Nigeria.
As a regulator, how do
you trace the origin of standards?
The
issue of standards could be traced to industrialisation, which is the basis and
origin of standards. Standards started from the very time the colonial master
came to Nigeria. The British imperialist made incursions into the country and
most parts of Africa just to feed the British industries with cheap raw
material from the colonised states.
Before
their incursion, there was production but their coming brought about standards
and such standards are what we in the institute believe in.
NIPM
was established in 1985 to maintain standards and in 1987 we had gone round the
country and that was the year we had our first annual general meeting.
How have you been able
to regulate the industry since 1985?
I
tell you my friend that it has not been really easy regulating the industry
since 1985. It has been a tough one, but lots of impacts have been recorded.
Some
of the problems faced in the process of managing production in this country are
such that some production managers have not been finding it easy with us. A lot
shy away from been regulated because of inferiority complex based on standards
that we strongly stand for. Some of them are waiting to be chartered before
they can join us. But for those, who are our members, whom we regulate, we have
been able to maintain that level of standard practice with them.
For
our members, we set the standards for them and they abide by it.
But
let me add here that standard is process-based and as such it differs in
various sectors.
Standards
in production vary because different standards are employed in various kinds of
production. For example, it is not what it takes to make a vehicle tyre or tube
that it takes to produce milk or bread. These varieties and diversities pose
enormous challenges in regulating the industry.
So how would you rate
the companies that are currently under your regulation?
All
companies registered with us are performing within the regulated standards,
which of course has an international value. All our corporate members have Good
Manufacturing Practices (GMP) as well as Health Safety Environmental (HSE)
management practices. They all pass through the basic process standards that
we establish from time to time. For these reasons, it is difficult for our
regulated members to be chased by NAFDAC or the Standard Organisation of
Nigeria (SON) for substandard products because they have passed through our
standards. We set the standards and they are conforming. Apart from setting the
standards, we train their staff and organise workshops and seminars for them
from time to time.
Let
me say here that NAFDAC will not have had any business chasing manufacturers
for substandard good if there was entry level set out for people to operate in
the manufacturing sector. The Accounting profession is a recognised body and no
person practices the profession without regulation and set standards. The same
should be applicable to production, hence the position of the institute on
regulation remains strong.
We
want the Federal Government to get this institute chartered to enable us have
strict regulation across the manufacturing sector. Should we be chartered,
NAFDAC would not have problems chasing manufacturers for unethical practices.
What do you think is
responsible for unethical practice in manufacturing industry
There
are no laid dawn standards, hence, anybody comes into the industry and carries
out unethical practices. People’s involvement in unethical practices has
gone a long way in rubbishing the image of the industry and that is why we are
committed to standards amongst our regulated members. For example, people enter
into production management without the qualification to practice it. A chemist,
for instance, is supposed to end up as a chief chemist, and a food technologist
is supposed to end up as a food technologist, while an engineer is supposed to
end up as a chief engineer. These professionals no doubt are good in their
various fields but the issue is that when it comes to managing production and
operations, it is a different ball game. When these technocrats came into the
industry initially, they were only managing the technicalities of their
businesses, and later they came up to manage beyond technical specialties and
began to manage people, process, and machines. At this stage, they need more
than the entry knowledge they had. They need to acquire other operational
management skills to enable them cope in their new assignments. A pharmacist in
a pharmaceutical company that was recently promoted to a factory manager, needs
managerial skills because he nolonger practices pharmacy, but operations
management, and he needs additional knowledge to cope well in his new area of
job. All these have to do with ethics and standards in production management.
The problem most companies face is the inability of operational managers to
synchronise all the units.
How can privatisation of
government companies and parastatals help to move the nation forward?
Privatisation
is an economic policy of government that enables it to handover its business
interest to private investors to manage such businesses properly. I see
privatisation as the acceptance of government’s failure in business, and
government accepts this fact, hence the intention of government to handover
most of its companies and parastatals to private investors. It is true that
government has no business in business, hence such move, and I support the
government for the initiative.
But
given our own economy, it is true that the United State government is
interested in the privatisation process. The U.S. government believes
privatisation is good for Nigeria, and some critics say the interest of the
U.S. government is not far from the fact that they want Nigeria to raise some
money to pay-off its external debts.
But
the problem with the country’s privatisation is that most people in
government are the same people paying to own government companies. The
country’s privatisation is just like a re-cycling process where the same
people in government still want to control government properties.
It is
not that privatisation is bad, but my position is that it should be transparent
and another issue about it is that not all government parastatals and companies
should be privatised. Government parastatal like MINT is a sensitive parastatal
that should not be touched. I believe in selective privatisation process and I
am also of the view that it will help our country, Nigeria, in terms of strong
economic base among others.
The
truth is that government has no right to sell public property without first
consulting the public. There should be a public forum where issues would be
well deliberated on.
For
example, the privatisation of Nigerian Airways was ill motivated and ill
informed. In the process, a lot of money went down the drain and money
exchanged hands. If the intention behind privatisation is for the interest of
the masses, then it is a welcome development and it would no doubt help the
country. But if the intention is not of public interest, then of course it is
not acceptable by me.
How would you react to
the issue of standards when the Standard Organisation of Nigeria (SON) seized
substandard goods worth billions of naira, recently?
The
issue of manufacturing substandard goods has been a recycling occurrence in the
industry. The laws and the standards are there but people still do not conform
to these standards.
Some
people deliberately order for substandard goods all in the name of making quick
money, while others, who are in production come out with substandard goods.
I see
all these as combination of naivety as well as preparedness by some individuals
to flout the law.
But
let me say this without mincing words that all those, who are involved are
power brokers in the society.
It is
true that SON goes about seizing substandard goods, but on the contrary, I
think the right step is to nip the problem in the bud from the very basis of
production instead of waiting for the last minute to clampdown on people.
There
should be factory inspectors, whose duties are to go out there and inspect the
factories before the locally produced goods leave the factory.
So what are the
implications of substandard goods to the Nigerian economy?
I do
not know what you refer to as substandard goods. In the past, most goods
produced in Taiwan, Malaysia, Japan and Singapore, were referred to as fake and
substandard. Only goods produced from Italy Germany, America and Britain were
regarded as genuine, but later on, manufactured goods from Japan and Malaysia
were classified as standard. Most of these imported manufactured goods are not
substandard in the real sense.
But
if you refer to faking and adulteration of goods, then I have to agree with you
and will be prepared to speak on its implications.
The
implications to the nation’s economy are numerous. Firstly, it dents the
country’s image such that it would dissuade foreign investors from
investing in Nigeria, thereby denying the nation of some financial gains. It
could also lead to threat of lives and wastage of funds by government in
finding solutions to such health problems.
I
would advise that small and medium scale enterprises seek advise from the
Institute of Production Management before going into production. There is more
to production than the eyes could see. Production staff should have COPOM
certification to expose them to the nitigrity of production management. COPOM is
an acronym for College of Production and Operations Management, were
certificate and diploma courses are run. At COPOM, we train people in
production management and expose them to the standards they should follow in
production. Let me sound here that fake or substandard products are products of
fake manufacturers. It is the person that makes the product, and if the person
has education on production management, and has the right attitude and
knowledge, he would not be naïve about production standards.
Recently members of
Senate moved against corporate bodies that boycott tax payment. Why must
companies shy away from paying tax?
The
issue is what are they getting from paying taxes? Tax monies are supposed to be
used for the development and maintenance of infrastructure, and the provision
of conducive work environment for business to strive. But unfortunately, the
infrastructure is not there, yet manufacturers are compelled to pay taxes
regularly. Government itself should leave up to expectation and do well to
invest tax monies into basic infrastructure that would benefit manufacturers.
We have no good roads and the issue of electricity for production is in
shamble, yet government insists on regular tax payment.
The
truth is that government at all levels has renege on its promises of providing
basic support by way of infrastructure such as good roads, portable water,
electricity, conducive market environment among others.
To be
honest with you, there are too many taxes to be paid. Federal Government taxes
are there, the state taxes are there, and if you put a business logo on your
car, you are subjected to pay tax, if you mount a billboard you pay tax, if you
buy land to set up a manufacturing plant, you are subjected to tax. Our
colleagues living abroad that are in the manufacturing industry are getting tax
holidays, but here in Nigeria, it is a different ball game.
If
the environment is not conducive for business, government should know that
people would not be happy to pay tax. The principle of taxation says that you
pay tax from your profit, but in Nigeria it is hard to make profit because of
the harsh economic environment, hence most production companies are folding up.
Manufacturers
Association of Nigeria (MAN) is currently not happy with the Lagos State
Government for its multiplicity of taxes. Manufacturers are tired of all these
taxation. I must tell you the truth. The demand from manufacturers is for
government to create enabling business environment, and not multiplicity of
taxes.
What exactly do you
think the government should do?
Government
should create an enabling business environment for manufacturing business and
other businesses to strive in the country. Government should study the success
story of developed countries and apply the same in Nigeria.
India
for example, shot down its boarders from imported goods and compelled Indians
to make do with what they had. Manufacturers were challenged not because of
government policy, but because they were given enabling environment and there
was encouragement from government. Today India does not only manufacture pins,
blades, and other office and household devices, but also manufactures aircraft.
How would capitalisation
in the manufacturing industry help to shape the industry?
The idea of bank capitalisation cannot be introduced in the manufacturing
industry. The Central Bank of Nigeria (CBN) has its reason for raising the
capital base of banks.
You
know that the banking industry is quite different from the manufacturing
industry, and their modes of operations vary such that what is possible in
policy implementation in the banking sector, may not be possible with the
manufacturing industry.
How do you handle the
issue of pirated products in your sector?
We do
not call them pirated products, but product faking and adulteration.
There
are lots of products faking in the industry and the best way to handle the
situation is to give proper training to manufacturing staff, and that is what
NIPM stands for.
If
the right training is given to production staff they are bound to conform to
standards and there will be nothing like product faking and adulteration.
I
stand firmly to say that those who are into faking of products are not members
of NIPM. We have equally trained our members to circumvent such evil act, just
as they all distant themselves from faking. There are, however, several ways to
protect products such that they are not faked in the market.
How has the practice of
production management helped in eradicating poverty in the country?
Ideally,
without production, all nations would have been in shamble. God himself new
this and God is the Chief producer. The first thing God did was to create and
creation is production. Without production management, there would be no
development. The oil that is giving Nigeria lots of money is based on
production management. So I say that production management has been able to
eradicate poverty in the country.
Poverty
cannot be eliminated in Nigeria if we pay lip service to production management.
Let
me say here that there is difference between production and production
management. Production itself can be in its crude form and in that stage, the
yield is not been optimised. But managing production ensures getting maximum
yield from the resources available. Production management has to do with
managing human resources, physical resources, mineral resources, financial
resources, and obtaining maximum yield from them, and this is what the
Institute of Production Management that I represent, stands for.
When
productivity is increased and managed well at all levels, there would be job
opportunities and this will greatly reduce poverty in the land.
Are government policies
helping production management?
Government
is not helping matters in anyway. Government policies are harsh and there are
no encouragement and incentives to grow the sector. I have personally been to
Abuja several times to get this institute chartered but the Federal Government
is yet to see reasons why the institute should be chartered.
By
the time this institute is chartered, it will go a long way in checkmating
faking of products in the industry. For now, we are confined to only our
volunteered members, who are doing us proud. You will not see any of our
members involved in fake or adulterated goods because of the standards we
preach to them. There are lots of fake products in the market today because
government allowed every individual, who are interested in production to go
into production without even the basic knowledge of production. This is where
production management comes in and we are asking the government to make this
institute relevant by getting it chartered so as to enforce production
management on manufacturers.
What are the plans of
the institute to move production management forward, amid government
unwillingness to support the institute?
We
are looking at productivity increase. Production management is all about
optimising the yield of all the resources employed in the process of
production, and by doing that, you are increasing productivity, and when
productivity is increased, organisations would be more profitable, employment
opportunities would increase and poverty would be alleviated. When these
changes take place, employers would be able and glad to pay tax.
So what exactly are some
of the problems facing production management in the country?
There
are lots of problems facing production management in the country. In the first
place, there is the lack of access to professional education and continuing
development. Nigerian Institute of Production Management that I represent
cannot alone provide professional education to its members and we need the
support of government, and the support of Manufacturers Association of Nigeria
(MAN). We also need the support of NAFDAC, SON and all ministries that are
concerned with production management in the country.
We
need a charter from government to enable us do our job effectively. When we are
chartered, we will be empowered.
Consumers
change their taste and producers need to change along side with consumer taste
and be conversant with modern trends in production. The same applies to
production management.
Government
has to give recognition to production management. Although the present
government is ensuring that the economy is diversified, I would advise that the
government take a deeper look into production and production management.
Another
problem facing production management in the country is lack of infrastructure.
We lack good roads, there is scarcity of water and the power supply is
epileptic and unreliable. Making land available for production is another
infrastructure problem.
Government
is not interested in industrial development. Government is not interested in
what manufacturers are doing to upgrade process technology. Those that are into
research and production are greatly under-funded.
Nigeria
does not have an industrial development policy. All we have is industrial
policy. Government is not interested in how to grow industry. Daewoo automobile
established plant in Korea on a 50/50 shareholding and at a point in time the
Koreans developed the technology and the government gave them all the
encouragement and today Korean has automobile companies and they build their own
cars outside Daewoo. But in Nigeria we are never interested in home grown
indigenous technology.
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