Feb 12, 2011

How not to do business in Africa

This is an illustration, or a parable, I cannot vouch for the accuracy of the information and I report it only as hearsay.

A certain international financial aid organisation approved a grant to the government of a particular country, said grant to assist in an infrastructure upgrade designed to improve conditions in many areas. In this case the funds [some millions of US $] were earmarked for an IT project within a particular government department.

Company's A, B and C applied for the tender and duly submitted their proposals. At an unspecified time during this process a representative of Company C met with Mr. X, a government official responsible for the project. An agreement was reached, funds changed hands and they parted the best of friends.

When the tender decision was made, Company's A and B were informed that their bids was unsuccessful. Based on the fact that their solution was provably  more efficient, and offered at a lower price, they approached the financial institution in protest. The institution agreed that, based on the numbers, Company A's proposal was more appealing so in all fairness they decided to allow all Company's to present their solutions, after which they would make a final decision regarding who would be awarded the tender.
The rivals presented their proposals and the adjudicators were unanimous in their decision: the pre-approved funds would only be awarded if the government department accepted the proposal of Company A.

Unfortunately Mr. X had in the meantime sumptuously partaken of the 'gift' received and was not in an accomodating frame of mind so the deal died right there and then.

Company C lost credibility [in addition to the unspecified amount that constituted the 'gift'], Company A lost the deal - your classic lose-lose scenario, and Mr. X was smiling all the way to the bank.

What do we learn from this:
1] When greed overcomes morality everyone loses
2] The surface of business in Africa is only the surface
3] There is a crook everywhere you look
4] Looking good does not necessarily being / doing good.
etc. etc. etc.

What pains me is that this kind of behaviour is rife all over the world, but in Africa this method of doing business is termed 'relationship-based' - you have a relationship with the person who greases your palm the fastest, with the most money. There is no real friendship, or trust, or respect. Just greed. Sad.

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