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Opinions of Wednesday, 1 February 2017

Columnist: Armah, John

Redefining entrepreneurship development in Ghana

By John Armah

Whether Job Creation is a function of government or the Private Sector, or perhaps a function of family and societal aspirations, Job creation remains a challenge for many governments.

While many of Africa’s entrepreneurs will either be aspirational or desperate to be Entrepreneurs, the true success of the new engine of growth (Startups and SME’s) in solving some of our greatest problems will lie in the true definition of their value proposition, which is the one (1) thing that determines whether people will bother reading more about your product or eventually buying your product. Your value proposition is a promise of value to be delivered. When a Business lacks value and solves no need, it is dead on arrival.

While the Business Model Canvas as a tool helps to define the business idea in a framework or building blocks which outlines your Customer Segments, Value Proposition, Distribution Channel, Client Relationships, Key Activities, partners among others, it is by determining whether a sufficient need/problem is in search of your business solution whether for profit or impact which will be the anchor of success for any Entrepreneur. Beyond that lies the issue of Corporate Governance, Culture and Values, Staff, Financial Reporting and others which define the true frame of a Business. Doing things right in Business has no alternative or shortcut and saves a Startup or SME the cost of it in years ahead.
The facts are simple,

“The ILO’s World Employment and Social Outlook (2016) , Trends for Youth report shows that as a result, the global number of unemployed youth is set to rise by half a million this year to reach 71 million – the first such increase in 3 years. With a youth population that is expected to double, to over 830 million, by 2050 in the whole continent, the incidence of unemployment among youth in Northern Africa remains elevated at 29.3 per cent in 2016, representing the second highest rate across all regions.

The research discloses that the youth unemployment rate in sub-Saharan Africa is expected to continue on its downward trajectory, which began in 2012, reaching 10.9 per cent in 2016 and decreasing slightly to 10.8 in the following year. Moreover, while the youth labour force participation rate is the highest in Sub-Saharan Africa at 54.2 per cent, the region’s enrolment rates in secondary and tertiary education is the lowest among all regions”.

The differentiation factor:

The call to revise our educational curriculum must move beyond the rhetoric to focus on the following: a) Introduce problem solving models at Junior High School
b) Actively allow Senior High School Students to engage in Internships, volunteering opportunities to define career options on long vacations. Introduce Business Case studies and business development concepts to such students as well as offer active Mentorship with Startup Champions or Business Leaders for practical approaches to problem solving techniques

c) Champion an increased effort by Public and Private Universities to setup Incubators, Accelerators and private funds supported by private sector. Academia will continue to remain the pivot of transition into work with the relevant capacities to shape such brilliant ideas which will be incubated. It is interesting to note that, at the Strathmore University in Kenya they are establishing an Incubator for Young Lawyers to help in the transition from academia to work. The call for increased attention to TVET is non-negotiable and to allow for the necessary linkages, Government must examine tax waivers, etc to potential employers of such skills trained in our TVET institutions as a way of stimulating growth. TVET institutions must be sufficiently provided with startup kits to trained Youth exiting such programs.

In the harmonization of policies, for example It is important to state that beyond the championing of a social enterprise policy by the Social Entrepreneurs Ghana, Ghana must actively work on instituting a National Entrepreneurship Policy, a visionary framework to capture the relevant support, institutions to be created, reporting relationships and approaches to growing our entrepreneurial ecosystem.

The Nana Addo Government has made strong calls to review taxes, utility costs and the general macroeconomic environment, while that is promising, the effect will be a cushion than a panacea to the rising cost of doing business. There are underlying challenges businesses face in the area of business development which must be addressed either through an overhaul of the Business Advisory Centers(Bac’s) under NBSSI or largely by increasing advocacy on what such services could do for business growth.

Redefinition of Concepts of entrepreneurship:

For growth focused Entrepreneurs, the differentiation factor for 2017 will be the establishment of appropriate Governance, Financial reporting structures, review of monetization strategies and Business Model, curation of past performance in annual statements and reports, establishing appropriate work culture and ethics and continuous effort in capacity building for managers and Staff.
While Social Entrepreneurship may be on the ascendancy, the differentiating factor will be models/businesses that have a blended value of profit and impact with the relevant metrics established to assess the impact of such firms, the appropriate tabulation of efforts in a Log frame, and the communication of same through the log frame to communicate results quantified in outputs, activities, outcomes, costs, the relevant indicators and means of verification.
Practical approaches to Redefining Entrepreneurship on the continent

1. Consider establishing a Job center to Match existing Jobs with people actively looking for jobs matching Labor Supply to Labor Demand and providing industry data on jobs created, available and prospective jobs to be created for adequate preparation by Youth to fill such jobs.

2. Relook at the Educational Curricular as proposed above.

3. Establish a National Entrepreneurship Policy

4. Provide Startup Kits to TVET trainees and plant them in regions, communities for knowledge transfer, skills development.

5. Re-examine and revert the Youth Enterprise Support fund to its original structure to focus on complementary financing, quasi-debt and provide auxiliary services tailor made to the needs of Startups but in conformity with international standards for better exits and models.

6. Align all Youth initiatives established by Government under an Apex Body, either under a separated Ministry of Youth from Sports, with an inter-ministerial committee or board to be better accountable to the Youth of Ghana

7. Establish a quota for the inclusion of youth led businesses in the award of contracts.

8. Create a Diasporan Desk for Ghanaian Nationals abroad at the Ministry of Foreign Affairs to coordinate the re-integration of Ghanaian Youth from Abroad home, whether their interests are to start a business or find a job to move back home.

9. Establish a “Social Bond” Mechanism to increase efficiency in addressing Social Problems i.e. “If the social outcome improves, the government commissioner repays the investors for their initial investment plus a return for the financial risks they took. If the social outcomes are not achieved, the investors stand to lose their investment. – Social Finance.

Profile of Writer:

John Armah is empowering Young Ghanaian Entrepreneurs with Training, Investment and Strategies to tackle some of Africa’s biggest problems in the Health, Technology, Agriculture, Services and Arts sector as a Business Strategist, Investor and C.E.O of the Orios Group. He is building the capacity of Youth Entrepreneurs in Ghana and attracting the needed investments to them and shaping policy decision in helping to redefine Ghana’s Startup and SME Space.

He is an Award-winning Entrepreneur and Business Strategist with a passion for Startups Development and Growth in Africa. Named as part of Forbes 30 Under 30 Most Promising Young Entrepreneurs in Africa (2016), 20 under 40 Most Influential Business Leaders in Ghana by award-winning Business World Magazine (2015). Voted 12th Most Influential Young Ghanaian (2016). Ranked as the 27th Most Influential Ghanaian by ETV Ghana (2012).