Opinions Mon, 29 Apr 2019
Dear Lawyer John Kumah,I feel honored to write to you, and to tell you how hardworking you have been on the entrepreneurial front in Ghana as Chief Executive officer of the National Entrepreneurship and Innovation Plan.
Youth activists and Entrepreneurial Policy Advocates in Ghana are thrilled at the implementation of the very policies your outfit has rolled out since its establishment. We at the Africa Centre for Entrepreneurship and Youth Empowerment credit you for your sterling leadership and innovation at NEIP.
While we are encouraged to celebrate your efforts, and in the process, encourage others to the same, we would like to draw your attention to what we deem as strengths and weaknesses of NEIP as well as provide recommendation. The basis of what we wish to point out to you are based on findings from interviews with some beneficiaries and stakeholders. They are also based on further analysis of similar projects established locally and Internationally.
The Africa Centre for Entrepreneurship is an entrepreneurial policy think-tank established to promote youth entrepreneurship in Africa as a way of mitigating unemployment and reducing the impact of poverty.
You may agree with the statement, Good is not good enough if you can be better, better is not good enough if you can be best. It is against the admonishing that we seek to bring to your notice ways NEIP can be made more effective and efficient.
Considering the background of the NEIP, “The National Entrepreneurship and Innovation Plan is a flagship policy initiative of the government of Ghana with the primary objective of providing an integrated national support for startups and small businesses This points to the fact that NEIP primarily focuses on providing business development services: startup incubators and funding for young businesses to enable them grow and become successful. Further, the National Entrepreneurship and Innovation Plan is therefore set within the context of Ghana's long-term strategic vision of consolidating it middle income status, building an industry-driven economy capable of providing decent jobs that are suitable and sustainable for development.”
With this, our assessment is based on how effective and efficient NEIP is ensuring: an integrated national support for startups and small businesses; business development services: startup incubators and funding for young businesses to enable them grow and become successful; building an industry-driven economy capable of providing decent jobs that are suitable and sustainable for development. Thus, our assessment is captured as follows:
Strengths and Weaknesses
Based on our interaction with the stakeholders particularly, external stakeholders, we grouped our findings into specific areas as shown below:
In an article sited on myjoyonline.com on 18th December 2017, NEIP and its Private Sector Implementation partner (PSIP), the African SME organization received a total of 6128 applications across the country. These numbers sound encouraging; however, it requires some interrogation. NEIP boasts of training 7000 applicants in a documentary it commissioned. Our interviews revealed that some applicants applied but were not accepted. With this, we beseech NEIP to come again on how it arrived at the latter number.
The NEIP promised to assist the Startups based on the four tier SME support ecosystem. These included advisory services, access to finance, access to market and policy (providing conducive SME ecosystem).
It is unclear the nature of advisory services that NEIP renders to the businesses and the impact so far on indigenous businesses. Stated differently, beneficiaries of the NEIP business support are yet to receive support on how to penetrate both the domestic and international markets. When and how is this going to be done?
According to the said article as on myjoyonine.com, the China-Europe International Business School was expected to develop a curriculum as well as facilitate the trainer of trainers in all regions. How effective was this? Did it materialize? Could the NEIP not explore other innovative ways of engaging the hubs to draw the curriculum with tested and proven localized examples, and which of course would be relatively cheaper?
Unlike Innovate Ghana, the NEIP chose on an average a month for the training with participants with varying days and time for the training. This was largely due to the high number of participants as against limited space by the Hubs and also limited number of trainers or less funding to hire the services of other experts. This then affected the quality of the program. Could the NEIP not reduce the number of trainees and increase the number of resource persons to engage these startups or provide additional funding to the Hubs to hire the services of extra professionals if NEIP wants to improve upon its own performance?
Since some of the applicants of these programs were graduates who were not yet employed, these persons were challenged with funding to attend the training and fully concentrate during the training sessions. Basic support with water and snacks were missing at the centres where these trainings took place.
Partnership with the Hubs
Partnering with the Business Hubs in Ghana ensured Window 1 (one) of the NEIP programme decentralized to all regions. This made it possible for entrepreneurship enthusiasts to participate in the program upon acceptance. Even so it allows participants to also identify problems in their communities and solve it. NEIP gave room for flexibility such that the hubs could have room to train participants on topics they deemed appropriate based on the needs identified among entrepreneurs.
In as much it is good to partner with the Hubs in Ghana, more mechanisms could have been set in place to ensure higher standards. As compared to other successful entrepreneurship programmes such as Innovate Ghana, NEIP should have equipped the hubs with professional mentors for guidance and also professional consultants to already existing businesses with consultants for consultancy intervention.
Partnership with the Hubs offered NEIP the platform to promote practical entrepreneurship training as compared to the usual entrepreneurship lectures. However, the NEIP failed to make the trainees result-oriented since it did not have a structured mechanism of doing so. If Businesses should end up in the market place, the NEIP should do a better with that.
Funding to startups
As compared with other entrepreneurship programs, the NEIP unlike other entrepreneurship projects equipped 1350 participants with funding opportunities. This is the biggest funding to SME’s within a single window here in Ghana. This is a step in its direction.
There are thought-provoking concerns surrounding the effectiveness of how these monies were disbursed to participants. For example, the NEIP could not follow its own timeline of disbursing the funds. There was a number of inconsistencies with the proposed time for disbursement and the time entrepreneurs received their respective disbursement, participants were given money after the training program where after each session participants could have received the money to implement what was required of them. This would have ensured on-hands training and made entrepreneurs more accountable on how they are to use the funds.
During the training, participants of the programme had to pay for their own expenses even whiles building prototypes, printing and other startup costs. Among the interviewees, those in the idea stage we spoke to revealed how this was a challenge to them.
Monitoring and Evaluation
Recipients of the loans were given 2-3 years to settle their respective debts. This is good as it gives entrepreneurs much flexibility on expanding their businesses.
Due to lack of supervision and continuous professional advisors and mentorship, the likelihood that most of these debts would end up as bad debts is very high. Stated differently, the tendency that some entrepreneurs would falsify documents and use their respective contributions into other profitable ventures is equally high.
Although the road to excellence is always under construction, we should be minded that quality in ordinary things results in things done extraordinarily well.
In light of these facts, I would strongly urge NEIP, under your able leadership, to initiate a research of the situation to assess the impact of Window 1 which would aid you with effective implementation of subsequent windows. However, we have a few recommendations for the proposed research.
1. NEIP must focus on quality over quantity. This could be achieved by reducing the number of trainees whiles ensuring there is enough support and infrastructure geared towards achieving the ambitious key Performance Indicators set by the NEIP. These should reflect the 1000s of jobs the NEIP wants to create through the support given to the startups.
2. NEIP must also set realistic timelines and ensure it is very consistent and effective with its communication flow especially with Hubs. This creates room for Hubs to be seen by entrepreneurs as a trusted partner whom they can rely on after the training. It also gives room for entrepreneurs to effectively plan and execute their targets. Information is critical in entrepreneurship.
3. NEIP should set up an independent body or persons to sit during pitching by the entrepreneurs after the training for further funding opportunities. This would reduce the tension of entrepreneurs having the notion of political interference.
4. There should be a standard curriculum based on tested and proven localized solutions and make this readily available to the Hubs. This would ensure uniformity, higher standards and consistency among the stakeholders.
5. A quality assurance team to effectively monitor, evaluate and ensure that the best of entrepreneurship content and practices are delivered to the entrepreneurs.
6. NEIP must create room and work with angel investors and investment groups to get them provide support to startups on flexible payment terms since 1 Window was struggling to raise funds.
7. Disbursement of funds through hubs using an effective and efficient incubation program with clearly stated anticipated outcomes and deliverables is required. This should ensure all activities including challenges and progress are well captured and documented whiles ensuring there is effective monitoring on how funds are been used.
8. NEIP must also profile, build and maintain an online platform to engage these entrepreneurs by opening it up to multiple stakeholders whose services are likely to reduce the impact of challenges faced by these businesses.
9. Also, NEIP must be consistent with what it promises entrepreneurs. With this, NEIP should minimize the expectations of entrepreneurs especially when it is relying on government for support. For example, the NEIP promised to give entrepreneurs who qualify to the next stage after training an interest free loan. This was never the case.
We believe that not only are you seeking the good of the entrepreneurial ecosystem but that you are striving for excellence. We know there are higher standards set both locally and internationally which you may want to launch a competitor analysis into it.We are prepared to provide assistance to you in carrying out this task for the reason that we, at the Africa Centre for Entrepreneurship and Youth Empowerment, and other policy units are determined to provide alternative approaches based on data to help the NEIP to be more effective and efficient.
I thank you for the work you are doing in combating poverty through entrepreneurship – the enemy of wealth creation and prosperity.
We look forward to hearing from you.
Columnist: Emmanuel Acquah