Mr. Femi Adeoti is the CEO, Inlaks Plc. In this interview, he discusses how companies can overcome digital challenges, and key into the opportunities of the 21st century ICT sector adding that companies which fail to measure up risk being kicked out of business. According to him, the rise of e-commerce stores in Nigeria is a pointer to the fact traders who will succeed must go digital in order harness opportunities offered by e-commerce. Francis Kadiri reports
What vision do you have for the Nigerian ICT market in five years’ time?
By 2022, I believe that ICT will be a catalyst contributing the maximum share to the national income in terms of productivity, growth, and performance across all sectors.
Your company is pushing for the growth of mobile money adoption in Nigeria and Africa as a whole. In an age of cybercrime, would this initiative not be slowed down?
Africa is celebrated as the birth place of mobile money revolution, piloting the initiative that has seen more people coming into the financial fold in many countries in the region and leading the pace with an advanced form of financial inclusion.
However, the mobile money revolution that the African continent is experiencing comes with unprecedented cyber security challenges. Unlike some other technological challenges that Africa imports from other developed regions of the world, mobile money challenges are unique and do not seem to be subjected to much copy and paste solutions.
Consequently, when it comes to the issue of security for the end users, Africa has got a number of challenges because we are adopting phones and moving into mobile money. In a typical sense, we usually rely on the developed world to assist us with the protection of our IT systems, but with the challenges of mobile fraud that seems to accompany the mobile money initiative, we would have to build our own routes around that.
In December 2016, the Federal Government said it would establish science and technology villages and museums in the six geopolitical zones of the country in 2017. Do you think this initiative would help spur the growth of the ICT sector?
Everything that needs to be done to encourage the growth of the ICT sector must be done. However, as earlier mentioned, the will and the commitment to see these initiatives through is quite important.
In what ways can Information and Communications Technology become a major revenue earner for the country?
The Information and Communications Technology sector continues to sustain its position as the fastest growing industry in the Nigerian economy. The sector has grown at an average of 34 per cent per annum over the last 10 years. This has been driven largely by the rapid expansion in telecommunication infrastructure, following the deregulation of the sub-sector in 2001.
The industry’s contribution to the Gross Domestic Product is growing modestly from less than 0.5 per cent in 2001 to six per cent in 2012. With a population in excess of 160 million people, low but rising per capita income and a substantially youthful demographic structure, the ICT industry has the potential to drive the national economic growth at the much desired double digit rate. Nigeria has therefore made good progress in expanding mobile communication signal coverage.
I believe that ICT has the greatest potential to eclipse oil and gas as the core source of national income in Nigeria in the nearest future. It has the potential to be a major possible source of revenue to the country.
As a deplorer of banking solutions, what would you say is the greatest risk facing the banking industry today and how could banks address the problem?
Disruptive innovation is the major risk. The landscape is changing and will continue to change. Organisations that fail to adapt fast will definitely be left behind.
With the rise of e-commerce stores in the country, does this in any way portend a danger for brick and mortar stores?
More than 80 per cent of the online population has used the Internet to purchase something in Nigeria. In this same regard, we are also moving our solar energy business to the e-commerce space as our customers and prospects expect us to be available. This e-commerce presence will allow us to keep up with the competition as we expand our business from Business to Business (B2B) to Business to Consumers (B2C).
How can companies equip themselves for the challenges and opportunities of the 21st century?
Digital transformation is in full swing, and companies are doing their best either to stay one step ahead, or at least to keep up with the crowd.
IT companies must equip themselves for the challenges ahead by meeting expectations of customers in the digital age and also by being able to gather information and evidence, coupled with some measurements in place to make comparison with other competitors. IT companies must be able to compare and contrast the value proposition of their various ICT solutions.
What policies do you think the government should be formulating right now for the growth of businesses in the country?
There are already good policies in place to encourage business growth in Nigeria, the only thing the government needs to do is to encourage and enforce the adoption of these policies. The government must have the will and also should be seen to be interested in putting those policies into action.
It is said that the country spends about $1bn annually on the purchase of foreign software. As a company which invests in ICT, how could we develop the local software industry?
The indigenous software companies could survive in a very competitive market by concentrating on certain competencies or dimensions of Information Technology such as software re-engineering and IT sourcing.
What should the states and Federal Government be doing to encourage entrepreneurship drive among youths?
They need to encourage patronage. Government must be seen to be the number one customer of local entrepreneurs. By doing this, they would be encouraging the citizenry also to ensure adoption.
Your company has strong partnerships with foreign companies such as IBM, Moody’s Analytics, and VMware and so on. Do you have partnerships with indigenous companies?
Yes, we have identified ourselves with few indigenous software and e-payment companies that share same vision with Inlaks.
What more should local companies do to scale up?
Local businesses should start to think big, big in the context of capturing Africa and not just some little corner of Lagos or Nigeria and be determined to pursue this dream. It takes a lot of gut to run a business in Nigeria, so they shouldn’t limit their dreams to Nigeria alone. They also must consistently work on their business, change the paradigm from time to time and not just run the business for running sake.
What would you say are the challenges affecting the full implementation of the cashless policy in the country?
Nigeria’s cashless policy faces several challenges including poor network connectivity, multiple debiting of the customers’ accounts, high transaction charges, Point of Sales (PoS) machine malfunctions and other technical issues. These challenges have brought some discouragement to the customers and have resulted in a slow adoption of the cashless policy.
In support of the CBN’s financial inclusion programme, Inlaks recently introduced Hyosung Finger Print Biometric Automatic Teller Machines into the Nigerian market. How far has this initiative progressed?
We are currently engaging the Central Bank of Nigeria, the Nigeria Inter-Bank Settling System and all the banks regarding the integration of our ATMs (with fingerprint readers) to fit and adapt into the BVN architecture in order to promote identity management from the ATM channel. We are working with our foreign partners who have deployed biometric ATMs in large scale in other markets such as South America and some parts of Africa.
What is your company doing to deplore more of such ATMs, especially in the push for a cashless economy?
We are presently offering a lease option as an ATM acquisition model to our customers to aid the deployment of our ATMs to every part of the country. We also partnered with Interswitch and one of the commercial banks to introduce interbank cash deposit on our intelligent cash recycling ATMs across the network. In addition, we have deployed the first solar powered mobile branch with two Hyosung ATMs to the same bank for transportable banking services in Lagos.
What has been Inlaks’ business philosophy over the years and why are you sticking to this?
Our business philosophy falls under one broad acronym “IPEAC”. IPEAC stands for Innovation, Professionalism, Excellence, Adaptability and Customer Focus. These five objectives define how we operate and this has been working well for us. We will continue to be innovative, never compromising on ethics, be adaptable and continue to adapt to the changing business and economic environments. In addition, customer satisfaction will continue to be our priority. The IPEAC philosophy therefore is a major staying power for us as an organisation.
How would you describe the past 35 years in the history of Inlaks?
The last 35 years have been an interesting period for Inlaks by transiting from one business portfolio to another and still remaining relevant despite various economic challenges and disruption in Information Technology products and services. We remain focused on meeting the needs of our numerous customers in spite of several disruption in the Information Technology space. We also remain focused on promoting our core values.
You have interests in the banking, energy, oil and gas, telecoms sectors and so on. How has the company fared in these industries?
Inlaks has over the years been flexible and adaptable to the changes in these sectors by providing unique solutions to the needs of our customers towards achieving growth and stability. We have built and maintained Tier-3 data centres for many banks, oil and gas and telecom companies. We have equally witnessed rapid growth in the deployment of our Hyosung ATMs in the last three years.
What is the whole idea behind Inlaks’ current rebranding exercise, and how will this benefit the industry?
The only constant thing in life is change. To remain relevant, we have to continuously re-invent ourselves. Our rebranding initiative is a repositioning exercise to better serve our clients by proactively creating solutions and services they can leverage for their business growth. We are looking into the future and answering questions that will position us and our clients to take advantage of future business opportunities as they arise.
One of the missions of the company is using ICT as a tool for economic growth in Nigeria. How far have you gone in achieving this mission, especially in a country with low broadband penetration?
We have been in the Information Technology business in Nigeria for 35 years and this I would say is no mean feat in a business climate like Nigeria. We have pioneered different areas in the ICT sector over the years and many of our staff have moved on to establish some successful Information and Communications Technology businesses in Nigeria. This underscores the fact that we place emphasis on manpower development. Recently, we opened our state-of-the-art Technical Resource Centre, where we also established the Inlaks Academy for training in different areas of the technology business. I am highlighting this to show that we go the extra mile to reinvest in this economy through training and creation of opportunities for the aspiring youths.
Apart from poor broadband penetration, what are some other challenges facing the development of the ICT sector in the country?
ICT represents an enormous opportunity for introducing some significant and lasting positive change across the Nigerian landscape like every other developing world. The rapid penetration of mobile access (in particular) has resulted in considerable improvement in the lives of the poor in both rural and urban contexts. The breath-taking pace of penetration and uptake of mobile telephony and broadband internet is supporting many new possibilities, products, and services thus providing breakthrough ideas in many sectors.
However, this new potential and opportunity is accompanied by significant challenges and possible threats such as funding, changing roles and norms, pace of change in technology, gaps in skills and competence amongst others within the local workforce.
Recently, the company trained some Nigerians in building solar energy. What more could companies like yours do to promote entrepreneurship among the youth?
We are expanding the solar training to universities and secondary schools as part of their academic curriculum to train and expose these young students to the opportunities and possibilities that abound in the solar technologies. Later in the year, we would be launching our maiden edition of Inlaks hackathons to bring together innovative strangers to solve problems and improve our country with exceptional technology. The proposed hackathons will combine the expertise of software developers, programmers, entrepreneurs, and digital enthusiasts, who can all create many more ideas by working together than if they worked alone.
Is there a way in which the economic recession in the country has affected the growth of the company?
Just like every other player in the ICT industry, importation of finished goods has been very challenging owing to the scarcity of hard currencies. Also, the buyers are now more cost conscious and are demanding for better pricing of the goods and services.
Your company’s slogan is, “Own tomorrow.” Can you tell us what steps the company is taking now to own the future?
“Own tomorrow” is much more than a slogan; it is a mantra of our business vision. Inlaks is committed to being the number one ICT business in Africa. To achieve this, we are creating the enabling environment where innovative ideas and opportunities are quickly spotted and harnessed.
We are building our human capital by recruiting highly talented young men and women with a good attitude and training them through our Inlaks academy which is being positioned to be the number one ICT training centre in Nigeria. These are just some of the few initiatives we are putting in place to position Inlaks to take ownership of “tomorrow”, today.
With the dwindling focus on oil globally, has your company’s interest in the oil and gas sector decreased?
As a business decision, we have never put our eggs in one basket, oil and gas has never been our core business area even though profitable. We have consistently looked into other areas where we can invest our skills and time and this has been our staying power. That said, the oil and gas sector will for a long time remain viable and therefore we will continue to invest in it adequately.
You recently launched an e-banking solution called Temenos. What is the initiative about and how is it going to impact on banking in Nigeria?
Temenos was not recently launched into the Nigerian banking sector. It has been around for a while now. In fact, Temenos was a pioneering Fintech solution in the Nigerian banking sector. The brand has continuously improved upon itself and today, it is unarguably the number one Fintech solution in the world. We as a business will continue to push the best in-class solutions into the market and encourage its adoptions.
The International Telecommunications Union ICT Development Index for last year showed that Nigeria still lacks behind, ranking 137th out of 172 countries examined. How do we explain this?
The report shows that the world is getting more and more connected and reveals that there are still huge investment opportunities for the private sector to connect the unconnected.
To get more people connected, it is important to focus on reducing overall socio-economic inequalities in the country. Education and income levels are strong determinants of whether or not people use the Internet.
Information technology will be essential in meeting each and every one of the 17 Sustainable Development Goals (SDGs), and this report plays an important role in the SDG process.
Without measurement and reporting, we cannot track the progress being made and identify areas that require action, and this is why ITU gathers data and publishes this important report every year.
