President and Chairman of Council, Nigerian Institute of Production Management (NIPM),Dr Olaniyi Opanuga has been speaking on why many Nigerian Manufacturers are not making enough profit to increase shareholder value and maximize growth opportunities.
His position was contained in a speech he delivered at a forum on manufacturing operations at the Nigerian Institute of Production Management Operations at its national Secretariat,Ogba,Lagos.
According to him, Nigerian Manufacturers cannot afford to shun Professional Production and Operations Management Practice Standards regulated by the Nigerian Institute of Production Management (NIPM).
Full speech below:
On Manufacturing:
Manufacturing which is another name for Production is used to describe the process of converting raw materials into into finished goods on a large- scale especially in a mechanized or automated environment such as a factory or site. Specifically, manufacturing means industrial production. Manufacturing is an aspect of Production just like Agriculture, Mining, Energy, Construction and Services. The professional body responsible for regulating the practice of Production and Operations Management in Nigeria is the Nigerian Institute of Production Management- NIPM.
Nigerian Manufacturers including foreigners who own Manufacturing businesses in Nigeria will continue to underperform and fail to compete well both locally and globally because they enjoy hiring cheap labour and unprofessional Managers, Supervisors and Operatives with little or no professional training and career development opportunities to motivate them for high productivity.
The contribution of the Manufacturing Sector to the Gross Domestic Product is still relatively low.
“Though there are obvious manufacturing challenges that are consequential to the conundrums of industrial capacity underutilisation and high cost of manufacturing in Nigeria but most manufacturing companies fail to look inwards rediscover themselves, re- engineer their processes and improve systems and structures for improved efficiency.” .
He lamented that only a few manufacturers subscribed to the Nigerian Institute of Production Management- NIPM Code of Ethics and Professional Education, Training And Development Standards…adding that most Manufacturing/Operations Directors, Plant/Factory/Production Managers and Supply Chain and other Specialists who oversee Manufacturing or industrial production operations were not professionally qualified to do so.
Global Importance of Production Management:
In view of the importance of this vital area knowledge this is quite unfortunate. Global economic and political leadership throughout civilisations, including the grandeur of colonialism and the present day jostling among the World powers for leadership is all rooted in superiority of Production capabilities. That is why Gross Domestic Product (GDP) is a metric National development and economic progress.
NIPM and Federal Government Collaboration on Made-In- Nigeria.
“We have been talking, agonizing and advocating for a change of status quo of Production externalities in Nigeria. NIPM has led national advocacy efforts over the years to kickstart government interventions through appropriate economic and industrial policies. The Institute has for many years partnered the Federal Government to provide MADE- IN- NIGERIA and create a conducive environment for local manufacturing to thrive through better policy initiatives and incentives. There is the need for government to fix infrastructures, stop multiple taxation, provide incentives for local manufacturing, tame inflation, halt smuggling, deal with tariffs and so on. However, companies should look inwards in their own interest and reflect on the things they do wrong”.
Manufacturers as their own enemies:
“Many Industrialists and manufacturers still lack the corporate consciousness of professionalism in Production and Operations Management. The whole essence of Manufacturing is profitable Production and the effective Management of Production is critical to their success. The are not so serious about taking appropriate actions The employ quacks and professionally uncertified people to run their factories….both local and foreign. Little wonder many factories have closed down while many others are struggling to survive. They think they know a lot in self- deception. With a deluded mindset you will get antiquated in a fast- paced global knowledge economy”.
“In business professionalism should be a core value. Professionalism cannot be sacrificed on the alter of flimsy excuses, especially in the face of increasing competition, emerging technologies (with all the market dynamics), disruptive innovations and globalization. Everyday and in fact every minute new ideas are emerging thus making obsolescence very rapid”.
Globalisation and HRM Role:.
“Given the volatility and complexity of the global economic environment and increasing cross- border trade with lowering of barriers championed by the World Trade Organisation (WTO) and the increasing adoption of ISO quality standards manufacturing organisations and their CEOs and Managers need to modify their behaviours and attitudes. The imperatives of change are glaring not only in Nigeria but also all over the world. It should not be business as usual. Nigerian manufacturers need to learn continuously. They need to encourage their Human Resources Management to constantly improve professional education and training of Production Workers. Even the Human Resources Management Managers themselves need orientation and training in Professional Operations Management. HR Operations Management training is available at NIPM. They need to gain new insights. Manufacturing organisations need to encourage innovation and creativity in Production and Operations Management. They need to operate as learning organisations with the capacity for effective transformation, not the type they theoretically pontificate” Opanuga noted.
Professional Education,Certification and Training Sacrosanct:
” Oftentimes, manufacturers cut their noses off to spite their faces by stopping training or slashing training budgets arbitrarily. Detraining leads to atrophy, demotivation and demoralization which adversely affect manufacturing productivity and performance”.
” Ignorant employers think that allowing workers to attend training courses will disrupt their operations and reduce their profits. This is not true. There are ways to manage learning and development for cost- effectiveness and peak results. That’s what the Human Resources Managers need to know. Training and Certification or Professional Diploma programmes sponsored by Employers actually lead to higher profits,ultimately. You will get a highly efficient, motivated, innovative and productive workforce needed for enhanced competitiveness and profitability.”
” Employees need to obtain Professional Certifications that are relevant to their jobs. They need to increase knowledge through constant learning and development. They need new skills from time to time. They need to share knowledge among their peers on a continuous basis not only In- house or on-the- job but also across the industry through membership of professional bodies.They need professional networking to raise awareness and for benchmarking, to raise the bar of conduct and update themselves on the latest techniques and tools for effective practice” Opanuga asserted.
“Manufacturing organisations that are not concerned about Professional Development and Career Advancement of Production and Operations Managers, Supervisors and Operatives cannot make most of their resources or achieve meaningful medium- long term goals. There must be a congruity and mutual complimentarity between corporate vision, mission and values and professional development and ethics” he said.
Professional values,Culture and workers motivation:
“Most Nigerian Manufacturers are failing in their desire to be locally and globally competitive because they lack the right professional values and culture. Those who have good intentions sometimes lack finishing power as they are often bedecked wih distractions, false starts or outright negligence.They handle or treat Production and Operations job holders and their professional development with levity. They don’t see them as Professionals. They think they are just another set of tools…..to achieve high outputs at the lowest cost possible. Yes, they have no respect for them. They dont think they are carrying out professional jobs. With this attitude, they don’t encourage professional training, certification and membership of the Institution regulating the professional practice of Production and Operations Management which is NIPM. Responsible organisations will not do that. That is the root cause of their dilemma” says Dr. Opanuga.
Global leaders believe in professionalism and continuous learning:
“The leading manufacturing companies in the World whether in the USA, Germany, France, Japan, China, Korea or UK and others don’t joke with professional standards.
Moreover, the best brains in the world relish professional and lifelong learning. Examples can be found in the case of Toyota and other world class learning or transforming organisations. CEOs or Manufacturers that are quick to talk about Six Sigma, Lean Manufacturing Systems, Just- in-Time or Toyota Production Systems need not go to Havard. NIPM will teach them better”he remarked.
” In an attempt to help manufacturing companies develop knowledge and skills of their employees I have personally led a campaign to organize Free Professional Training Programmes of the Nigerian Institute of Production Management- NIPM but they will give one reason or another why they cannot be released to benefit from such rare opportunity. I find it difficult to understand why many organisations are not taking advantage of the Non- Profit facility of the Institute and yet prefer to pay consultants to do less for them at a high cost. Who is betraying who?”
But here in Nigeria we have this “know it all attitude” and the penchant to rubbish home- grown ingenuity”. We simply look the other way and pay lip service to professionalism and ethics. Business owners and top- level Managers are always expecting government or some people to force them to do the right thing in their own interest.This is naivety and shortsightedness.
Human resources Management:
He said “Top Management are fond of using incompetent and unprofessional Human Resources Managers to do the bad job of slave driving production workers in many organisations. Of course, if you pay peanuts, you get monkeys!”
“The unprofessional Human Resources Managers and their counterpart Production/Plant/Manufacturing/Operations Managers work with a Managing Director or General Manager to develop, apply and share ignorance, theoretical knowledge and bad traditional practices backed by native intelligence to the detriment of the Organisation. Yet, they will blame their misfortunes on the Competition, the Country and the Government.
Unqualified people in production and operations management:
According to Dr. Opanuga ” as an Operations Management Consultant I know what I’m talking about here. It is absurd that most CEOs, Manufacturing/Operations and Supply Chain Directors, Plant/ Factory and Production Managers in Nigeria are not professionally qualified to practice. They are not registered and certified by the Nigerian Institute of Production Management (NIPM) in line with the law.”
“Consequently, ignorance and unethical practices are shared right from the top and made to flow down to the Production floor en route to the customers. This is what translates to the manufacturing and distribution of poor quality, substandard, adulterated and fake products that constitute health hazards to the consumers and the general public.”
Nigerian Institute of Production Management – NIPM has been fighting professional misconduct among Manufacturers for over 30 years. This compliments Federal Government efforts at sanitizing the manufacturing industry through such Agencies as the Standards Organisation of Nigeria (SON) and the National Agency for Food Drug Administration And Control (NAFDAC).
It doesn’t make sense to avoid professional learning and development in an E-Commerce-centred Global Economy driven by technology, innovation and knowledge. Knowledge drives the other two elements when it comes to routing for competitive advantage.
“Organisations should not allow unbridled cost- cutting measures to get in the way of professional training and development. Learning, continuous learning and sharing of knowledge and best practices among professional peers are key to productivity and performance in organisations.”
Too vital to be left to bad leadership:
“The entire World pivots on Production and Operations. Remove Production from the World or a Nation and you have nothing left.
The economic growth of a Nation and the survival and profitability of manufacturing organisations, and indeed all organisations depend heavily the Production and Operations knowledge, skills, capabilities and ethical values of the Leadership.”
CONCLUSION.
“As the year draws to a close many manufacturers will be counting their losses not only because the Coronavirus pandemic occasioning factory shutdowns, disruptions of global supply chains and logistics, economic slowdown and the truncated market demand but because they lack professionally qualified Operations Management and largely due to inability of Top Management to build professional resilience in their Manufacturing and Supply Chain Operations” .
