The exacerbating inflation and difficult situation of the economy in Nigeria
By Francisco Vallejo
I believe that the three major issues confronting David Larson and Larson Inc are first, the exacerbating inflation and difficult situation of the economy in Nigeria, making it harder and harder for companies to do business in this country. This economic issue is followed by political burdens, such as government constraints. There was (and there is, today) a lot of political instability in Nigeria and a lot of issues Larson confronted were due to the fact that legislation and regulations often change, giving place to a lot of bribery among businesses and officials. Then, I believe that the third major issue Larson faced was human resources issues. Hiring local employees with the required skills was very hard, while at the same time, hiring foreign hand labor was made hard as well by the government and their issuing of work visas. Thus, there was a handful amount of qualified people to do the job.
In my opinion, the hardest issue to handle would be the economy, as it goes beyond Larson. However, there are measures and plans that can be taken to prevent economic drawbacks and adjust to increasing inflation. Secondly, contingency plans to deal with political bribery, as all companies have to face this matter while doing business in corrupt countries. We studied in MAN 4602 that sometimes companies have to face these corrupt officials and adjust to their way of doing things if they want to succeed in the country they are dealing with. Lastly, finding valuable human resources is also a tough matter to handle, especially when both locals are not qualified and foreign labor is too expensive and too complicated to get due to the limited issuing of visas, therefore, Larson could focus on improving their training practices for new employees.
Being a subsidiary general manager provides the benefit of following the headquarter’s plan without any issues, as well as taking their own independent decisions. On the other hand, joint venture subsidiaries have to take into account their partner’s ideas and decisions and come into agreements for all decision making, making it harder to arrive at outcomes that both parties agree with, and this may be a huge drawback in situations that require quick decision making.
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