I thank Allah SWT for sparing our lives to be part of today’s occasion. I like to thank the organizers of this occasion for considering me worthy of addressing this august gathering, and in particular thank the Dean of Engineering, the Head of Mechanical Engineering Department and my friend Dr. Funsho Alabi. I was asked to speak on Entrepreneurship; I therefore decided to speak on the why, the how, when and the where of Engineering Entrepreneurship and tag it the dynamics of Engineering Entrepreneurship. It is not an academic paper, so do not expect to see or hear anything about Fourier series, Complex Variables or Laplace’s Equations but rather, why does one start an enterprise(eneurship), how does he start it, when and where.


 THE DYNAMICS OF ENGINEERING ENTREPRENEURSHIP

BY

Engr. I. K. INUWA OFR, FNSE, FIMech E, FAEng

Chairman Governing Board, National Board for Technology Incubation NBTI.

1st March 2011

1.     INTRODUCTION

I thank Allah SWT for sparing our lives to be part of today’s occasion. I like to thank the organizers of this occasion for considering me worthy of addressing this august gathering, and in particular thank the Dean of Engineering, the Head of Mechanical Engineering Department and my friend Dr. Funsho Alabi. I was asked to speak on Entrepreneurship; I therefore decided to speak on the why, the how, when and the where of Engineering Entrepreneurship and tag it the dynamics of Engineering Entrepreneurship. It is not an academic paper, so do not expect to see or hear anything about Fourier series, Complex Variables or Laplace’s Equations but rather, why does one start an enterprise(eneurship), how does he start it, when and where.

2.     DEFINATION

The word entrepreneurship means so many things to many people. In one extreme, an entrepreneur is regarded as a person of very high aptitude who pioneers a change and posses (es) characteristics found in only a very small fraction of the population. On another extreme an entrepreneur is seen as anyone who wants work for himself (1).

Engineering Entrepreneurship can be defined as an enterprise that is founded on basic application of scientific discovery towards meeting the needs of man. It is scientific, technical and technologically driven towards business. Bamiro describes it as technical entrepreneurship, technological entrepreneurship or rather ‘technopreneurship’, which is defined as, the innovative application of scientific and technical knowledge by one or (several persons who start and operate a business and assume financial risks) to achieve their vision and goals (2).

 

3.     WHY ENGINEERING ENTREPRENEURSHIP

When I graduated in 1973 I was opportune(d) to be a pioneer NYSC Corp member. Six months before completing the service I had three offers for jobs as a trainee Mechanical Engineer and I opted to go and work in my state of origin as a Mechanical Engineer in the Ministry of Works and Transport in Kano. Graduates in any field then, had (ve) automatic employment in either the public or private sectors of the economy whatever their class of degree or diploma. There was nothing like today’s world hydra-headed problems of unemployment, population explosion or the economic recession. In fact, in most Northern states of Nigeria, majority of professionals working in the civil service were (are) foreigners from Poland, India, Pakistan, Philippine, Egypt, Sudan etc because there were not (no) enough Nigerians. Today it is a different story. Graduates of five years are roaming the Nigerian streets jobless in search of white collar jobs. The system has least prepare (d) them to face employment challenges and as Sylvester notes, the dynamics of the Nigerian business environment and its implication on entrepreneurship.(V.M. Sylvester ”The Dynamics of the Nigerian Business Environment: Entrepreneurship Implication.”Seminar Paper on Imperatives of Entrepreneurship Education in Nigeria: Banquet Hall, University of Benin. 27/9/07). What therefore, is the way forward? The answer is (in) entrepreneurship, itis the engine that provides the answers to unemployment and economic recession. Successful entrepreneurship brings benefits to the owner, to others, the operating environment and the country at large.

The more general reasons for setting up Entrepreneurship as stated by Uche are (1):

I)                  Self-employment, offering more job satisfaction and flexibility of the work force.

II)               Personal economic dividend

III)            Employment of others, often in better jobs.

IV)             Development of cottage industries

V)                Encouragement of indigenous technology by processing local raw materials into finished goods for domestic consumption as well as export.

VI)             Income generation and economic growth.

VII)          Health completion thus encouraging higher quality products.

VIII)       More goods and services available

IX)             Development of new markets

X)                Promotion of the use of modern technology in SME’s to enhance higher productivity.

XI)             Encouragement of more researchers, studies and development of modern machines and equipment for domestic consumption.

XII)          Development of entrepreneurial qualities and attitudes among potential entrepreneurs to bring about significant changes in the rural areas.

XIII)       Freedom from dependency on the jobs offered by others.

XIV)        Reduction of informal sector of the economy

XV)           Reduction of brain drain.

XVI)        Tax advantage.

 

4.     HOW DO YOU SET UP AN ENGINEERING ENTREPRENEURSHIP

In 2006, the Federal Government set up a presidential committee on entrepreneurship to see to the implementation of entrepreneurship in all Higher Education Institutes (HEI’s) each with an entrepreneurship center. These centers were to be sponsored by the ETF and technologically equipped. It was also expected that they would be creatively productive in bio-fuel, solar energy among others and go into partnership with industries and corporate organizations and successful entrepreneurs who would encourage, train and financially support startups in their environs. Thus Ladi Kwali pottery is refrigerated, Bida Brass is mechanized etc and the centers ready for entrepreneurship development. An entrepreneurship ab-initio must have a clearly defined objective with the entrepreneur believing in himself and the project he wants (to) pursue. In effect the Entrepreneur needs to select a location, decide on the business and its structure, obtains necessary licenses and permits and determine which financial option is likely to meet the short, medium and long term needs of the enterprise. In his paper Iliyas Mamman Bello (3) proposes seven steps to creating a start-up for a successful entrepreneurship. These are as follows:

l)          Entrepreneurship: Starting a business requires high degree of interest or inclination and some special features. You must be energetic, optimistic, and possess the ability to live with ambiguity and willingness to take calculated risk. Studies show that success is closely related to interest.

ii)         Opportunity: find an underlying need that has not been exploited or fully met. Add value or innovation and you are in business.

iii)        Market: Create market for your idea by talking to as many potential customers, suppliers and distributers as you can. It is ascertain that business fail at an alarming rate yet too often we blame lack of finances or poor management for the demise. A close look often reveals that the real problems relate to marketing issues such as identifying the customer, defining the right product/service to meet customer needs, pricing, distribution and promotion. (4)

iv)       Mentor: link to someone with experience who can assist and guide. It is the best way to protect ones business against failure. Registration or link up with some related organization like National Association for Small and Medium Enterprises NASME could offer a lot of opportunity.

v)        Business Plan: This is a written document that describes in detail all aspects of the business. It needs to address the following: what is your product or service? Who is your target customer? What need does it address and how are you going to turn the idea into money making venture? It is important to note that business plan is the basis for discussion with potential investors and financiers. In answering these questions business background and history, intended products and services, operational process, market analysis, marketing strategy, project detail, management structure, human resources, premises and equipment, financial information, funding requirement, risk requirement and business structure are to be articulated.

vi)       Business structure:  this is the legal form of the business. The options to choose from are: business name, sole ownership or proprietorship, partnership, limited liability companies and corporate entity or corporation. Each offers different legal protections, tax savings and ownership requirements. They also differ on how complicated they are to set up.

vii)      Funding: most business enterprises are self funded. This means the entrepreneur dips his hands into his personal savings. Getting fund through family and friends are also a possibility. Bank loan is often tough because of demand for collateral. Other likely sources include potential suppliers and prospective customers who might be willing to help out for good discount. In other economies venture capitals are source of fund, but in Nigeria they rarely exist and if they do seldom do they invest in start up. A huge source of fund, known as Small and Medium Enterprise Equity Investment Scheme SMEEIS was established by the banking industry in the country as a directive from the Federal Government to cater for the funding needs of Small and Medium Enterprises. It is not easy to access. A good business plan may offer a starting point.

 

Contrary to the above, one may decide to buy an existing business. In such a case various scenario should be considered.

5.     WHEN TO SET UP ENTREPRENEURSHIP

There is no specific time that is designated to set up an Entrepreneurship. However it is important that the timing is right and this can only be dictated by the Entrepreneur, the economic condition and environment. Setting up engineering consultancy outfit needs different requirements to setting up a facilities management services, a manufacturing outfit etc. As indicated above business plan is sine quo non to the time when a successful business enterprise is set up.  As a post graduate student in England in 1976 my three friends and I planned to set up a foundry industry in Kano. After the necessary study, legal and financial plan we could only established it in 1986. It was called Basic Tech Industry, Ltd Kano. We produced spare parts for textile industries in Kano, Kaduna and Gusau as well as produce hand pumps, grinding mills etc (5). We were operating till the closure of Nigerian textile mills and the incessant power failure in Nigeria.

 

 

6.     WHERE IS ENTREPRENEURSHIP SET UP

Market for products and services, source of raw materials, accessibility to markets and clients, cheap and skilled labor, power supply, water supply are very important for locating a successful entrepreneurship. The exigency of each is determined by the type of Entrepreneurship.

 

7.     THE NIGERIAN ENVIRONMENT

The business environment consists of the following(V.M.Sylvester, 2007)

-         The task environment(suppliers, marketing systems and market)

-         The competitive environment(better products, low price, advertising)

-         The public environment(employees, shareholders, government, media, consumer advocates, creditors)

-         The societal environment(cultural systems, political and legal systems, economic and ecological systems)

-         The legal environment(set of rules and regulations, legal framework of business, types of laws)

-         The technological environment( new technology-output, quality, prices, choices, ICT, ATM, cyberspace)

Having discussed the when, the how and where of Engineering Entrepreneurship let us look at the challenges in the Nigerian environment vis-a-vis the Entrepreneur(ship). Nigeria does not lack ideas to set up successful Engineering Entrepreneurship. Nigerian Universities, Poly and Mono technics, and Research Institutes have their shelves abound with many researches that have not been commercialized. The lecturers are awarded their PhDs while the students complete their projects in fulfillment for the awards of their degrees and diplomas. Attempts to commercialize the research products meet with stiff resistance. Individual inventors have been unable to break through to realize their full potentials. Even people with ideas seem to meet brick wall in actualizing their ideas. The situation is that while the researchers stay in the comfort of laboratories, workshops and design office Financiers do not want (to) take risks to invest in green areas rather they remain as traders just buying and selling. The status of our infrastructure is not helping the situation, for to say the least, it is appalling. The most important infrastructure, power supply, has been epileptic for most of the last twelve years. It is not all hope less, Government over the years has established some agencies to address the Infrastructure/Entrepreneurship issues.

National Agency for Science and Engineering Infrastructure NASENI

Federal Government of Nigeria FGN in 1992 set up a committee of One Hundred and Fifty engineers and scientists to draw up a blue print for science and engineering infrastructure for Nigeria. I had the privilege of chairing this committee. We visited South Korea, China and Brazil and made recommendation to Government for the establishment of NASENI under the chairmanship of the President of the country. It had Secretary to the Federal Government, Minister of Defense, Minister of Finance, Minister of Works, Minister of Industry, Minister of Planning, President of NSE, President of COREN, President of Academy of Science, President of NASSI plus two other eminent Nigerians as Board members. The Agency is charged with responsibility of developing the science and engineering infrastructural base for the nation. It set up Development Institutes in Akure, Enugu, Kano, Nnewi, Awka, Minna, Okene and Ilesha each with a specific mandate in line with the overall NASENI mandate. Since then it has produced products, services and systems and has commercialized some in partnership with some entrepreneurs. Examples of these are rotary furnace, science kits, hand pumps etc.

National Board for Technology Incubation NBT

National Board for Technology incubation, the Governing Board of which I have the honor to chair today, was established in 2005 with a mandate to coordinate and supervise technology incubation centers. It is charged with the responsibility to commercialize Research and Development (R & D) results and other inventions and innovative efforts, using technology incubation as a tool. The mission of the Board, therefore, is to develop the necessary infrastructure for nurturing technology start-ups, promote Nigeria’s indigenous potentials through value-added and technology-related activities and to create enabling environment for effective linkage amongst technology providers, entrepreneurs and capital (6). The incubation program provides selected entrepreneurs with all the services they need to develop their ideas from conception to commercialization. This involves the provision of shared facilities such as working spaces equipped with water and power supply, workshops, laboratory, computers, management assistance, and access to financing, networking and exposure to critical business and technical support services that enhance the success of enterprise during incubation period. There are today twenty one centers spread all over Nigeria including Ilorin and efforts are at hand to establish more.

 

 

Other Bodies

There are other bodies engaged in research and development in Ministry of Science and Technology, Ministry of Industry, Ministry of Agriculture, Ministry of Minerals and Steel Development that could form ready linkage with entrepreneurs for commercialization of research outputs.

The above gives some lead way for any potential entrepreneur to start working. I wish you the best of luck.

    

 

CONCLUSION

Engineering Entrepreneurship is that enterprise that is founded on basic application of scientific discovery towards meeting man’s needs;(mass production is achieved, choice of raw materials affect a greater population’s lifestyle, farms are improved and distances are shortened, efficiency is facilitated) and there is no better person to do that than somebody with the knowledge of science and engineering. In Nigeria there are challenges in setting up an entrepreneurship but with perseverance (and proactive responses) they are surmountable. When you set up a successful enterprise (neurship) you create jobs,(through re-engineering) you offer employment, you add value and you make money. So let us move and face the challenges.

Thank you for listening

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REFERENCES

1.     Uche, O. A. U. (2010): The Engineer in Society. Al-Aam Printers Katsina.

2.     Bamiro, A. O. (2001): Engineering Entrepreneurship, Paper prepared for the refresher Course for Prospective Corporate members organized by the Nigerian Society of Engineers, Lagos Nigeria.

3.     Iliyas Mamman Bello (2010): Seven Steps to Creating a Start-up. Technopreneur Number 1 Volume 1 April – June 2010. A quarterly publication of NBTI.

4.     Robert D. Histrich & Michael P. Peters: Entrepreneurship.

5.     Inuwa I. K. (1995): The Nigerian Society of Engineers 1995 October Lecture: Foundries sub-system, a crucial linkage for the successful operations of the other industries: Basic Tech experience.

6.     NBTI (2010): Our profile.