MY TAKE ON “THE PROSPERITY PARADOX”

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Earlier this year when Abdulwahab Oseni, a friend of mine was sharing screenshots of a book he was reading on his Whatsapp status, I reached out to him to find out the title of the book. When he said The Prosperity Paradox, I felt it sounded like a book I would love to read, I mean – who doesn’t like prosperity. The book however is not a self-help book on prosperity, rather it focuses on how innovation can lift nations out of poverty.

Let me confess upfront that what I read in the book wasn’t exactly what I thought I would. Like Feyi Fawehinmi wrote about the book, I was initially like ‘after all, there are many books like this out there.’ Most books either introduce you to something new or build on something you knew before, The Prosperity Paradox in my opinion does something different – it shattered what I thought I knew. It felt like some kind of new theology that unsettles your earlier doctrines.

Some years back, when Fintechs started springing up in Nigeria, the word disruptive innovation became a buzzword in the financial sector. This was because the traditional system of banking was being challenged and everyone had to sit up and look at better ways of doing things, the other alternative being – to close up shop and leave town! The Prosperity Paradox is written by the same man who defined and first analysed that buzzword – disruptive innovation – a term which has been called the most influential business idea of the early 21st century, Clayton M. Christensen. Prof. Christensen co-authored the book with two others, one of whom is Efosa Ojomo, who is originally from Nigeria but has spent the bulk of his adult life living and working in the United States. Having Ojomo on the team, I believe, helped in Nigeria receiving considerable mention (and attention) in the book. A good thing that was, because it really helped put the issues in Nigeria in context.

All of my life, I had always viewed business opportunities from the point of identifying an opportunity, or say, an opening in a market and jumping in to be a part of those cashing out – like for example, the Nigerian banking industry in the early ’90s or the Nigerian telecoms industry at the start of the millennium. But the book advises rather that entrepreneurs create the market. Hol-up, I thought it was the prerogative of governments to open up a market. Looking at the examples I cited earlier, entrepreneurs in the banking industry largely took advantage of government’s liberalization of banking licenses in the early ’90s, ditto for the GSM industry – the government had to do something first. The book advocates the other way round – entrepreneurs leading while government follows.

As I mentioned earlier, the book focuses on innovation, and the type of innovations that can lift nations out of poverty. In giving an hint about things to come, the book starts by saying that Not All Innovations Are Created Equal and then goes on to list the kinds of innovations as:

  1. Sustaining innovation, the type of innovation I knew growing up. I mean who doesn’t know of newly improved products? Commercials flaunting the re-branded and re-packaged products that now do more than it used to do before;
  2. Efficiency innovation, the one I got familiar with in the work place. Brainstorming sessions to come up with ideas to do more with less; and then,
  3. Market-creating innovation, the one that the book opened my eyes to and which is capable of changing the fortunes of not just the entrepreneurs involved, but also that of the nation it operates from.

You would recall that I mentioned earlier that the book put considerable focus on Nigeria. In one chapter, a Nigerian company was used at great length to illustrate one of the book’s ideas – the pull strategy. Take a guess. I bet you would think of one of the businesses of Nigerians on the Forbes list of Billionaires. No! Rather, it is a company dealing in noodles. It felt like an eureka moment for me – the point where I realize that many of the businesses in Nigeria don’t fall within the category of market-creating innovations. As the book says, it’s not that the other forms of innovations are bad, it’s just that they are ‘limited’. Let me allow the book speak for itself at this point –

For years, international scholars and media pundits have pointed to Mexico (substitute that for Nigeria and it still reads perfectly well) as the next potential superpower – but it’s always stuck there. Potential… But that is not going to happen until the country recognises that different types of innovations impact its economy differently. It’s not going to get there by relying on efficiency innovations alone.

 

If I am to summarize what the book does in few words, I would say – it is the fact that it calls us to put on new lenses in viewing prosperity – prosperity on the national scale, and not individual riches. It therefore advocates a shift to market-creating innovations, as only that can lift a country like Nigeria out of poverty into prosperity, just like it happened in America, Japan and South Korea. Hear what the book says,

Mexico and many other nations that are not yet prosperous have the ability to become thriving nations. But for prosperity to come about… we have to think about how to create new markets that serve the vast non-consumption.

 

The book is a recommended read for every Nigerian interested in the prosperity of Nigeria.

I am ‘Seun Alade

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