The marketing communication business in Nigeria has come a long way over the years in providing services to clients across various segments within the country. The industry has experienced remarkable growth in terms of delivery of quality product and service offerings, owing to the fact that there has been significant improvement in the country’s IT infrastructure.
This infrastructural development has aided the growth of the segment, currently estimated at N1 billion annually. In terms of losses, the marketing communication business has not incurred much loss rather; they have gained immensely from increased pricing on their products and services.
Their most prominent customer segments include the telecommunications companies who spend on average, over N30 billion annually on marketing. Marketing communication did experience some decline in its use by the financial services industry due to the need for banks to manage costs after the CBN led industry reforms.
Effect of removal of fuel subsidy on consulting industry
Concerns have been raised by various members of the larger society that the removal of fuel subsidy will have a negative effect on businesses across the country in the near term, but it is expected to ease up in the medium and long term. Although, businesses will be forced to better prioritise their expenses, a number of consulting firms that are well positioned for this economic period will do very well.
Based on the projections that the economy will be tight, we envision that a number of consulting firms will make reasonable gains in outsourcing businesses. For example, some clients would prefer to outsource certain technical functions such as HR and accounting to professional services firms as long as it makes financial sense.
However, consulting firms that do not have strong value propositions will struggle. Given that clients will be extremely cost conscious and in search for ‘real value for money,’ consulting firms that have typically thrived without differentiated and high impact solutions would not be approached for their services.
How consulting firms coped in 2011
The consulting companies that coped last year did so based on strong client relationship management: Some consulting firms have been able to build strong client base and relationships over the years, and have been able to leverage retainerships with these firms.
Secondly, a good understanding of the Nigerian market: The ability to navigate inherent bureaucracies within the market is also an advantage that made it easy for these companies to cope, and thirdly, staff strength and expertise: The quality of output of consulting firms has helped them gain the trust of their clients.
Addressing of delayed payment
Non-payment of fees by clients is one of the biggest challenges faced by business owners within the services sector. This problem is alarming as the consulting industry incurred losses of over N600 million last year.Some of the typical practices for ensuring that clients pay include signing of legal agreements and memoranda of understanding before the project commences. Now, firms are more creative in how payment terms are structured, for instance, some consulting firms collect a substantial part of their fee at the point of commissioning the projects and ensure that the client makes the final payment before the end product is delivered. Everybody wants to be a consultant.
In Nigeria today, there is room for individuals to work in whatever field of endeavour they choose. That said, the consulting space is not for people who do not have strong problem-solving and analytical skills. The consulting industry typically demands a high level of professionalism that cannot be mimicked. As the saying goes – “water will always find its level.”
Incompetent consultants often find themselves out of the industry in a matter of months, because the poor quality of their work is not tolerated by clients and supervisors in the firm.
Threat consulting poses to internal workforce
I think that this is a myth – that when a consulting firm is hired to do a job, that some employees of the client will be fired. To be frank, I do not know where this idea originated from, but we do notice it when we do work for different clients. Most times, we allay employees’ fears by informing them about the scope of work and our approach.
In projects that require that we look at improving employee productivity, we often use methodologies that promote right-sizing rather than downsizing i.e. moving employees to job functions that are appropriate and match their personalities and skill sets.
Economic outlook for 2012
It is expected that the economy will continue to grow at its current rate of 7 percent, with agriculture retaining its position as the dominant contributor to GDP. The agricultural sub-sector currently contributes about 46 percent of the GDP and is likely to increase its contribution this year through President Jonathan’s transformation agenda.
Based on some of the policies and developmental initiatives that will be undertaken this year under the President’s transformation agenda, it is expected that remarkable growth will be experienced in other sectors of the economy, especially the manufacturing sub-sector.
In the recently enacted Subsidy Reinvestment programme, plans are being made to increase the level of the nation’s productivity with huge investments in infrastructural development that will aid industrialisation.
Source:http://www.businessdayonline.com/NG/index.php/advertising/32406-consultant-sees-more-opportunities-in-outsourcing-businesses
