Time to create your own monopoly

Quote: The difference between good and bad product failures lies in the ability of companies and entrepreneurs to profit from the new insights that will be available from the catastrophe, which should naturally help to inform the next product development era

As Peter Thiel, founder of PayPal said in his book titled Zero to One, “every moment in business happens only once”. That moment comes and those who set forth at dawn, (as Wole Soyinka would say), are the ones that would grab it and become the “new lions in the jungle” moving and shaking the forest. That kind of moment is right ahead of us. Rather than think of the pandemic as the end of the road for the small business, I rather reckon that the opportunity to experience that powerful moment of change is close. Even more apt is Thiel’s comment that “the next Bill gate will not build an operating system. The next Larry Page or Sergey Brin won’t make a search engine. And the next Mark Zuckerberg won’t create a social network”.

Indeed, they will not. Rather they will create completely different and new kinds of innovative products and services. Is creating a Tabula Rasa for innovative companies to write on, especially in the technology field. The future belongs to those that invest wisely in these areas so as to create things completely new as suggested by Thiel.

It is said that a successful man is one that can lay a firm foundation with the bricks that others throw at him. The pandemic has thrown a lot of bricks at entrepreneurs and businesses, and indeed, all of us. The question now is who among the victims of the pandemics stone throwing will seize the moment and make something good out of the bricks. That is the subject of our present write up today. One big positive impact of the pandemic, whose full implications are yet to unfold, is the rapid increase in technology acceptance and adaptation among Nigerians.

Even the most “technology shy” people among us have suddenly learnt, not just to attend virtual online meetings but even to convene such meetings themselves. That’s a lot of gain for the future of this country. We are going back to more serious pursuit of technology, like we did when Obasanjo wanted to “Computerise all Nigerian Schools” but stopped short, as we always do. It is a good thing we take this opportunity to dig deeper in the technology space.

Technology has been the major driver of human activity despite the setbacks of the dot.com era. When in March 2000, the NASDAQ composite technology stock index rose above 5000 points, it was a pull factor for investors to go into that space. However, when those gains vapourized with the speed of a rocket and fell to 1,114 in October 2002, most people thought the end had come for investors in the technology field. It was so bad that analysts coined new terms to show how far away from it investors wanted to be.

Such terms reflected a negative outlook for the sector, including “moving from click to brick” – a concept that reflected the dismay of people with the technology industry. It evidenced the desire of investors to move away from it and go back to conventional businesses. However, those who moved in or remained, with inquiring minds, have done things, of which the original champions of Silicon Valley could not dream.

Every earth shaking event, like this catastrophic pandemic that is in the process of redrawing the global economic map, creates opportunities for those whose eyes are on the ball. It paves the way for those who are able to use the bricks it throws at them to build a bridge to something new. Undoubtedly, companies are going to have a hard time, and some products may fail forever – technology will rout them off their stand. Some of the failures may not necessarily be a result of the disruptions wrought by the pandemic. They are likely to fail as a result of new technologies thrown up by the pandemic and the new and better ways of doing things. The job of any corporate leader at this time is to remain at the cutting edge and forefront of the unfolding technology breaks.

The difference between good and bad product failures lies in the ability of companies and entrepreneurs to profit from the new insights that will be available from the catastrophe, which should naturally help to inform the next product development era. The drive towards more technology application could help companies create, not just their own Blue Oceans but even their own monopolies.

From the ashes of the destruction caused by the pandemic, great companies will arise; and by original thinking and innovation, new technologies will burst. Winners will be those who create their own new dominant products and services and by extension, their own monopolies.

The truth is that the economic Fallacy of Division is still operative in the affairs of man, in the sense that what is good for society as a whole may not be good for its members as individuals. Competitive markets may be good for the entire economy but for individual economic agents, like firms, monopoly is the safest way to success. There is nothing good about competition. If you can create your own monopoly why look for competition, with all the troubles of strategy and market share it brings. Society may complain of the many ills of monopoly, such as excess capacity (inefficiency), markup (usury) and the deadweight losses that it occasions, but a well-regulated monopoly promises a better prospect for corporate social responsibility to the community.

Again workers of a monopoly are often better rewarded. They are not pushed into chronic diseases like high blood pressure and diabetes, chasing the competition. Instead they are afforded more opportunity to think about workers’ health and products as well as to innovate. Governments are there to antitrust monopolies into line. For this new normal create your own monopoly.