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The Managing Director of Delog Nigeria Limited, Oludele Ogundinmu, in this interview with FELIX OLOYEDE, speaks on the impact of japa on the outsourcing industry. He also discusses how the local content law has affected the outsourcing industry
How did you start Delog?
I have a passion for human beings and during my youth service; I started using my passion for low-level workers where I served. I was privileged to serve with Shell Petroleum and on that note; I started seeing the casualisation of workers. My relationship with the casual workers at that time was excellent, and, on that note, I started supporting them. And while supporting them, I was able to see the needs of these workers. After my youth service, I started nursing the idea of starting an outsourcing company that would be able to identify with the low-level workers and how they could be heard, and how some of their problems could be solved. I studied law and had a master’s and MBA all these things have sharpened my experience to be able to cope with the job of outsourcing.
How has the local content law impacted outsourcing in the oil and gas sector?
We thank God for the government because most of the jobs that were supposed to be occupied by Nigerians would have gone to foreigners. So, the local content has helped. Nigerians now take up a lot of jobs or services that were in the past given to foreigners with the help of local content. A large number of Nigerians are now big players in the industry, especially in support services that are not technological-driven. They have taken over in the areas of support services and labour maintenance. The local content law has actually helped a lot.
Can you rate the progress made so far in terms of Nigerians occupying positions in the oil and gas sector?
Nigerians are trying lately, especially with the rate at which the naira is declining. I think it is making people want to stay in their own country and invest more because, with the exchange rate now, it won’t be easy for them to say they want to go and invest abroad. So, you stay here and do whatever you want to do in your local market since you belong here. Whatever you can make as profit stays with you here, unlike when foreigners come and repatriate their profits. On that note, I think Nigerians are thriving and doing well.
How has japa affected your operations?
Japa Syndrome is really hitting hard, especially among professionals. Sourcing for professionals has become a big problem, especially the IT and medical professionals, who are almost consultants in hospitals with this kind of rating. What they are giving them here is not worth it and there is a high demand for their services. It is a very big problem that we are still facing because virtually most banks today are empty, especially for IT people. Most of the hospitals are also empty. You just have to rely on private hospitals. And how many people can afford to access private hospitals? It is a very big blow, which I think the government needs to address quickly. Everything is not about money. However, what I think the government would have done to really help is to go back to the way they used to take care of workers in the 70s. In the 70s, it was not about just salaries; it was about the package that would cushion your welfare. There were facilities, like accommodations, that workers were not paying for. Vehicles and feeding were subsidised. The cash needs of workers are reduced. So, they were able to manage and stay in the country. This is the way they are also doing it overseas. I think the government should go this way by providing welfare services. Some companies that want to retain their staff are providing such welfare packages. If you don’t want your key staff to leave your company, you must address what is going to affect their welfare.
You operate in the health sector. There have been a lot of complaints about the quality of HMO services. There are challenges confronting that area of business?
Before we also floated an HMO company, we were using some HMO companies. We discovered that, though we were paying all the premiums, whenever we had claims, they were not making efforts to pay the claims. So, what we have done is register our own HMO. I investigated why HMOs were not performing. They have over-bloated overheads. The overheads are in terms of manpower and machinery. The cost of diesel has really hurt them. So, they find it difficult to be able to attend to the claims of the lives they have insured. Most of them after running for a year, begin to struggle. Most of them have partially closed. Also, Nigerians are yet to be fully educated on the importance of HMO. HMOs should be regulated and come out with good policies to boost the confidence of potential clients in terms of products and services.
Access to funds is a major challenge in the country. How is Delog coping with this?
For us to have access to funds we must have to build credibility. However, people are not patient enough to build credibility. If one doesn’t want to build credibility, how do you expect financiers like banks to listen to you? That is what I have observed. Before we started using bank loans, we had been able to build a relationship with the banks to be sure that we are truly in business. No bank wants to release money to an organisation or people they don’t really know. People arrange for companies to get loans from banks. There is also a problem on the part of the banks that are in a hurry to make profits. When a bank sees a good project from a customer, who is running a business but the profit might take up to three years to materialise, the bank may not be patient enough because they also want to make their profit in a hurry. If the government wants to help, from my experience in London, the government will study you. They will send so ministries to study those that are in business. When you register a company in the United Kingdom today, within the next 2-3 weeks once your certificate is out; you will see some complimentary services that will be trailing. These are the things our government should also do with the endless agencies they have created. However, if those agencies were functioning as they should that will be better. I have not seen any government agency trying to identify any company. The only agency I have been seeing is the tax agency, which comes to disturb me every time. I have not seen any government agency looking at our profile and seeing that we are paying our taxes and proffer how the government can help the business. Government can do that by using these agencies.
There are a lot of clamours for salary review while many states and firms have not been able to pay the N30,000 minimum wage. What is your take on this?
Some people will say that Nigeria is rich simply because they have not been able to check the indices very well. What determines that we are rich? It all depends on the services you are giving to the whole world. I respect Asia- China, India, etc. They produce not only for their own countries, but they are producing for the world. Unfortunately, in this country, we don’t have that kind of base. For Nigeria to be able to increase the salaries of workers, what are we as a country generating? The government is not a profit-oriented business? They rely majorly on subventions, grants, and allocation. How does that work because an allocation can go up and it can also drop? So, if allocation drops, the government would not be able to meet up. Government should also go into business just like private companies are going into business.
But it is a common saying that government has no business running a business.
The government’s business is governance. If they are not running efficiently, that means they are not making a profit in governance. Is it a good thing for the government to be having an allocation of budget? If you are in government, you must think of the right people that can manage funds. The funds being released, you need to see how the government wastes funds. So, when resources are wasted on white elephant projects; they will start projects and abandon them halfway or another government will come and demolish existing projects. Is that the way to run a country? Everybody must be in business if we want to revamp the economy.
Casualisation is still a challenge that the government and labour unions have not been able to tackle in the country. How do you think this challenge can be addressed?
To a very large extent when Obasanjo’s tenure was about to lapse, they started making so changes in labour that will address the benefit of workers. So, the idea of casual workers started closing up whereby not calling anybody a casual worker. So, it is not just by name but also by benefit. Today, we have laws that have been made that say you cannot pay a certain category of workers below a certain amount, which is standardisation. Today, every worker must have access to health, no matter how small, which is also part of the standard. It is now compulsory to put workers on pensions. So many standards are coming up. The only thing that is required is for the government to regulate them through the Ministry of Labour. The issue of casualisation has almost been addressed.
We still have issues around compliance in different sectors. How does Delog help its clients with compliance issues?
We have gotten to a level in the industry that we are not going to compromise our standards. As a trained lawyer, I know what it is and now we are in the era of social media. You do not want your company to be receiving backlashes everywhere. So, if we are going to have a contract, the first thing is for us to study the contract and we will also advise the client to adhere to all these compliances. We created an office and put a manager there and it is called the law and compliance department. The department is to ensure that a client that is meant to do a pension must do a pension. If a client does not listen, we will leave the contract. I have stopped a contract this year because of certain clauses in the contract. Nigeria is growing so fast in the area of enlightenment. We have human rights lawyers almost everywhere. We don’t want any embarrassment. So, compliance here is 100 per cent.
You also play in the real estate sector. The sector has been declining lately, what is responsible?
We are just coming up with this as a backup because we are getting old and we need to diversify. Property is not getting the attention that it used to get because of inflation. So, when inflation starts to hit the prices of materials, the builder wants to take it on the tenants or buyers. It will not work easily like that because before anybody will want to invest in or buy a property, he must have his money and they will have a lot of options. Instead of locking your property up, why don’t you allow potential buyers to pay on a mortgage as they do overseas? So, if they are renting out houses monthly, it becomes cheap for the tenants. In Benin and Togo, you can’t collect rent for more than a month. But here in Nigeria, they want the cash-heavy.
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