This piece is derived from a talk delivered at the Ausso Leadership Academy Nigeria Independence Day Masterclass, where I joined esteemed Nigerian business figures Juliet Anammah and Austin Okere to discuss strategies for Nigerian entrepreneurs and organizations to withstand current economic challenges with resilience and strategic insight.
Understanding the Challenges of Economic Instability
Economic turbulence in Nigeria arises from a variety of sources. On a broad scale, it may stem from sudden policy shifts, changes in political leadership, economic downturns, or currency fluctuations. On a more localized level, factors such as community unrest, aggressive competition, or abrupt changes in consumer preferences can also disrupt business operations.
Drawing from my extensive experience in entrepreneurship and corporate leadership within Nigeria, I have developed a straightforward yet effective approach to navigating these difficulties: the 5 Ps of Overcoming Economic Challenges.
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- Prepare & Plan: Anticipate potential disruptions by asking, “What unforeseen issues might arise that we haven’t considered?” and build adaptability into your strategy.
- Persist: Maintain endurance through tough periods to discover viable paths forward.
- Pivot: Be ready to make decisive changes when existing business models no longer serve their purpose.
- Partner: Cultivate relationships that open new opportunities, provide support, and keep you connected to market dynamics.
- Pragmatism: Ground your decisions in the realities of the local environment, safeguarding your people and assets while confronting facts honestly.
“Economic instability in Nigeria can originate from broad factors like regulatory upheavals and political shifts, or from localized issues such as community tensions and sudden consumer behavior changes.”
Insights from Real-World Experiences
In the late 1990s, my colleague James Kpanto and I launched Kwalita Transport in Jos. Our enterprise expanded rapidly as we reinvested profits to grow our modest fleet and employed around a dozen staff. However, the Jos crisis in September 2001 dramatically altered our trajectory. Many of our drivers, predominantly non-indigenous Muslims, became targets during the violence-one was killed, several injured, and numerous vehicles destroyed. This painful episode highlighted how even long-term residents could misinterpret the underlying ethnic and political tensions. Our response was rooted in pragmatism: prioritizing the safety of our people and acknowledging our misjudgments. We pivoted by reallocating capital into small retail outlets that could be secured during unrest and reopened afterward, preserving livelihoods and sustaining the business.
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The early 2000s brought a different lesson through AfriOne, a pioneering bandwidth and internet café venture in Jos, co-founded with friends including Danladi Verheijen of Verod Capital and Philip Mshelbila, CEO of NLNG. Inspired by a Lagos-based model, we quickly amassed 10,000 users within three months, franchised outlets, and sold VSAT bandwidth. Yet, the success was short-lived as aggressive competitors slashed prices unsustainably, and weak regulatory frameworks offered no protection. Attempts to pivot into phone cards and VoIP, along with expansion into Abuja backed by a $400,000 UBA investment, proved misguided. In retrospect, focusing on smaller northern cities would have been more prudent. This experience underscored the importance of pragmatic strategy and strong partnerships to guide sustainable growth. Although AfriOne eventually folded, it laid the groundwork for Jos’s tech and music scenes, with alumni like Jude Abaga (MI) influencing the industry.
Not all disruptions are local. In 2010, Tony Elumelu encountered a macroeconomic shock when the Central Bank of Nigeria enforced tenure limits for bank CEOs. Despite his successful tenure at Standard Trust Bank and UBA, he was compelled to step down at 47. Rather than view this as an end, Tony leveraged preparation and planning to pivot into new ventures. He founded Heirs Holdings and the Tony Elumelu Foundation and acquired a controlling stake in Transcorp. His extensive network across government and business sectors enabled rapid diversification into oil, hospitality, insurance, and agriculture. What seemed like a regulatory setback became the foundation for a broader legacy.
The experience of Boston Consulting Group (BCG) in Nigeria post-2015 illustrates resilience even among global firms. Entering with ambitions to rival McKinsey in West Africa, BCG faced a harsh environment marked by recession and currency devaluation under the Buhari administration. Instead of retreating, BCG persisted by maintaining a lean team, reallocating resources to projects outside Nigeria, and focusing on long-term positioning. Leveraging local connections, we partnered with state governments in Taraba and Plateau, securing contracts overlooked by competitors. A carefully planned office launch conveyed confidence amid uncertainty, signaling BCG’s commitment to the Nigerian market.
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Market adaptation is another critical form of resilience, exemplified by the 2017 competition between Lumos and Salpha Energy. Lumos, an Israeli company, entered Nigeria with substantial capital and a solar home system model imported from Kenya. Despite rapid growth, their leadership remained foreign, costs stayed high, and they failed to grasp Nigerian consumer realities. Conversely, Sandra Dozie of Salpha Energy localized assembly, priced products affordably, and leveraged Igbo trading networks for swift distribution. Her grounded approach and strategic partnerships enabled Salpha to outperform a better-funded rival, demonstrating that in Nigeria, local insight and practical strategies often outweigh foreign investment and hype.
By 2019, Nigeria’s emerging solar sector faced systemic challenges including stalled tariff exemptions, rising import costs, and currency instability. Individual companies struggled against these barriers. At All On, we responded by fostering collaboration. Partnering with the Rockefeller Foundation, we launched the Demand Aggregation for Renewable Technology (DART) initiative. By consolidating sector demand, offering naira-denominated loans, and securing import duty relief at scale, we built collective resilience that no single firm could achieve alone. This initiative highlighted how partnerships and strategic planning can overcome systemic obstacles.
Closing Thoughts
The unifying theme across these narratives is that economic hardship is inevitable. Sometimes it erupts locally, as with the Jos crisis; other times it sweeps the nation through recessions or regulatory shifts; and occasionally it manifests subtly through market changes or structural constraints. While the timing and nature of these shocks are beyond our control, our preparedness and response are not.
This is where the 5 Ps become vital. Preparation and planning prevent being caught off guard. Persistence sustains us through dark times. Pivoting enables transformation of setbacks into opportunities. Partnerships remind us that survival is a collective effort. Pragmatism ensures decisions are rooted in reality, protecting people, assets, and reputation.
These principles are not theoretical-they are hard-earned lessons born from financial loss, shattered ambitions, and even human tragedy. Yet, they also affirm that resilience is attainable, businesses can rebound, and growth can emerge from adversity.
For Nigerian entrepreneurs and leaders who internalize these insights, economic challenges become catalysts for innovation and growth rather than insurmountable obstacles. This approach is more than sound business counsel; it is a blueprint for enduring success in Nigeria’s dynamic economic landscape.
Dr. Wiebe Boer, Chief Growth Officer, JIPA Network.