We’re Here To Stay – Unilever Boss
Despite speculations that some major industries are relocating to neighbouring countries in order to cut production costs and remain competitive in the international market, the Managing Director of Unilever Nigeria Plc, Mr. Thomas Boedinger, has reaffirmed that the company will not leave Nigeria. In a recent chat with journalists, he, however, restates the need for improved infrastructure in order to foster a healthy environment for industrial growth and global competitiveness in the country. Mr Boedinger also speaks of his mission in Nigeria, his fascination with Nigerians, and the great opportunities that the Nigerian nation presents. -Elcee McEdwards
The declining state of infrastructure in the country is beginning to take its toll on the Nigerian industrial sector. As cost of production remains on the increase, the end users of made-in-Nigeria products bear the brunt as they have to pay more for their needs. The high cost of production in Nigeria which has been blamed mostly on the depreciating state of infrastructural facilities such as power, transportation, and security recently generated some fears that many industries would flee to neighbouring countries where production can continue at a more competitive rate.
The high cost of production in the country is most felt when the exporter’s goods arrive the international market. This is because the same product will have to be priced in competition with products from other countries with very effective infrastructure and favourable export incentives. This situation has led several industries and investors on an exodus to some other African countries who have prepared very favourable conditions that are aimed at encouraging productivity.
In spite of these challenges, some organizations still stand their ground with no intention of moving out of the country. During a recent chat with some members of the press to reveal various long-term investments which Unilever Nigeria Plc is making in the country, the Managing Director of the company, Mr. Thomas Boedinger, reaffirms that Unilever will not move its Nigerian operations.
Rather than leave the country, the Unilever Boss reveals that the organization is making significant long-term investments in Nigeria, which is as a result of the organization’s commitment towards enhancing the lives of Nigerians and its faith in the country. In his words, “86 years ago, we made a commitment to manufacture locally, because we believe in Nigeria and we believe we should operate in the market where we do our business.”
He further states that in the past 24 months Unilever has made fundamental long-term investments in Nigeria which include the development of new factories and expansion of existing ones. The company has continually expanded its sales structure to ensure that its products are accessible and that consumers are satisfied.
In the face of the difficult terrains and business conditions in the country, it is very encouraging to find multinational industries maintain their commitment to the Nigerian economy and consumers since this goes a long way to stabilize the manufacturing industry and prevent a total loss of confidence in the nation’s domestic economy by interested foreign investors.
Recently, Unilever invested over N3.5billion in establishing a detergent factory in Agbara, Ogun State and an additional capacity to its existing factories. These investments, Mr. Boedinger explains, is a demonstration of the company’s belief in the future of the Nigerian economy.
“We have much faith in this country and this is a major reason why we are developing our Nigerian operations as the source for detergent powders in West Africa. To achieve this, we have made several major changes and investments to ensure that our detergent powders operations are in line with international standards of quality and cost effectiveness,” he says.
Like most manufacturing companies in the country, Unilever faces a major challenge in growing its export division to compete favourably in the international market. In the domestic market, the company prides itself as a major player in the FMCG segment; some of its brands have been endeared to Nigerians to the extent of becoming regular house-hold names.
Though Mr. Boedinger admits that the company suffers under the present operational difficulties in the country, he declares that the organization is determined to stand by its commitment to serve the Nigerian people and expresses hope that significant actions will be taken by relevant authorities in order to relieve the troubles faced by local manufacturers.
Nigeria – A Great Opportunity
Before now, Nigeria was regarded as a pariah state. This in most cases put paid to the decision of many a number of ‘would be’ investors and expatriates that would have come into the country.
In most of these cases, they used the foreign press as the barometer with which they gauged their opinion of the happenings in the country. These, most often than not, turned out as mere unfounded stereotypes. This is why despite the brouhaha in foreign media, the country has become a haven for expatriates and investors who braved the odds to venture into the country.
Not a few of them have come to find out that the country is perhaps one of the leading countries that offer the most return on investment. The vast market potentials and the huge population of 150million people and fine weather are just few of the attractions.
In line with the above, Boedinger discloses that coming to Nigeria has offered him a great opportunity. This is against the unfounded opinion of some expatriates who have a phobia for the country and therefore do not see anything good in it.
But no one would argue that the accomplished manager of human and material resources, who has worked across a number of companies in Europe and Asia, including Bestfoods and Unilever, sure knows what he is talking about when he says that “Coming to Nigeria has been a great opportunity.”
In China, his last place of service, he set up Bestfoods from scratch, and by the time he was leaving, after eight years, the business had a turnover in excess of 100million Euros.
However, not everyone could leave the known for the unknown. But Boedinger received the news of his redeployment to Nigeria with optimism. According to him, “after eight years in China I wanted to have a new challenge. And the company came to me and asked, “Thomas, what do you like?” and I said “I like to be creative.” They said, “We’ve got something for you in Nigeria.”
Although, he did not know a lot about Nigeria, he sufficiently knew that the press wasn’t very good at that point in time. But he told himself to “have the right attitude and have a look at the place.” He actually came to Nigeria for a brief orientation visit in December 2006. It took him two days to be convinced.
“The business needed a turnaround; because it had collapsed in 2005 and 2006. I was sent in to deliver the turnaround; to make sure we regain the former position we had built in the market. We have to regain the trust of the consumer, which of course translates into business opportunities. It took me two days to decide. I was convinced that I could make the right contribution to drive the business forward.”
“To be able to achieve the set objectives, it was very important for me to find out who Nigerians are, whether I could relate with Nigerians and whether they could relate with me. Cheeky, as this might seem, he says, “I found a very good match.”
“By nature I’m a very curious person. I love emotions, in a positive sense as well as in a negative sense, because it gives you the chance to access a person. And for me as a leader, it is very important that I have access to my people. I believe that managing people requires a lot of motivation. In addition to that, as a leader, you must be authentic; you must be fully transparent and honest with people.”
The Turnaround
Now, with all these in place as part of the turnaround, the business has been recovering. “It is very important for me to know what kind of resources we need in the business. You cannot hold people accountable without giving them the necessary resources to get their job done. I believe that over the last two and half years we have helped ourselves turn this business around.”
As the leader of a turnaround team that must deliver, he knows it is most important for the team to rekindle the trust of Nigerian consumers in their brands.
So, over the last two and half years, Unilever has been rejuvenating its portfolio. This year alone, most of the brands on the stable of Unilever have been brushed up in one way or the other. Lux was recently re-launched with four different variants. “The new communication for Lux is already out; it is under-pinned by the new product offer which I believe is a very good one,” he says, expressing confidence on the job done on Lux. “Show me the woman or the girl that does not like to be beautiful or glamorous,” he demands. Also, the Omo Stains Challenge Campaign, which started in June, only ended last month. Omo, like it used to be in past years, is now almost a generic name in Nigeria when it comes to detergent powders. “Of course, we have re-launched Omo, and have built a new factory in Agbara Ogun State, making sure that we deliver a product that is up-to-date, and that can meet and exceed the expectations of Nigerian consumers. And I have to say that since we did the re-launch in June, we have been gaining market share. I guess that is the best indication of our success,” the MD adds. Most recently, a new variant of the Blue Band spread for bread was introduced into the Nigerian market, and the outcome has been overwhelming, according to feelers from the market.
Giving further clarification on the inroads Unilever has made in the past one year, Mr Boedinger insists that the four new Lux variants, the new Blue Band variant, the Omo Multi-active detergent, and the other Unilever brands have got all it takes to rule the market. In his words, “For us, skin cleansing is one of the unique opportunities in the Nigerian market. The potential here is limitless. I think we have a unique position in the market and we are capitalising on that. For us, it was important to re-launch the Lux brand; I wanted to see a new offer. And I believe the products we have at the moment are state-of-the-art. Products like Omo, Close-Up, Knorr, Blue Band, Lipton, Pears, Royco, and others are all doing very well. Their potentials here are limitless due to their unique position in the market.”
For Mr. Boedinger, the changes in the company is not about policy, but more of a realization that Unilever has to stay with consumers, providing them with brands and products that satisfy their daily needs. “The consumer makes the decision if he is convinced that your brand is a better offering than the competition. That way, you stay relevant in the business. I don’t think it is a policy; it is a basic understanding of business,” he explains.
Despite the downturn in the economy, the deliberate turnaround is yielding expected dividends as Unilever is noted to be running at a very high capacity utilization rate. “We are actually in a very privileged position. I know that a lot of my suppliers and competitors are not in that position. The market is definitely intense from my knowledge of major competitors. But the strong will survive in situations like this and the weak will perish,” he volunteers.
Infrastructural Challenges
Boedinger believes that Nigeria’s growth prospect will be greatly enhanced if basic infrastructure is improved as it will better position the nation to effectively compete even among most industrialised nations of the world.
“I am very much encouraged by what the Lagos State government has been doing despite its limited resources. I am also pleased by some of the steps taken by government to develop infrastructure like the concession of the Lagos-Ibadan expressway to a private company to manage. I’m very confident that policies such as these will greatly strengthen the Nigerian economy,” the Unilever boss says.
Boedinger, who has remarkably improved the fortunes of Unilever Nigeria after two and half years of being in charge, reasons that in a bid to keep the business running, manufacturers have invested huge funds into the provision of basic infrastructures which are often passed down to the consumers who has to pay more for consumer products.
He also maintains that while big multinationals like Unilever can afford to secure some of these costly infrastructural facilities, smaller companies in Nigeria cannot. “Most of us are running our factories on generators. We have built a gas fired power plant which will reduce our energy cost. For us, this was feasible because we have a sizeable business. Many small manufacturers, like our suppliers, don’t have this luxury. They have to run their operations on diesel, which of course is reflected in the cost of goods supplied to us, and which ultimately reflects in the price that the Nigerian consumer has to pay,” he explains.
On another hand, Boedinger adds that while government strives to provide infrastructure on one hand, it should ensure there is a level playing field by taking another look at its liberalization policies. He warns that though it is a good idea to support the local industry using the liberalisation plan, there is a need to apply some caution so that the local industry does not become complacent and lose its sense of competition.
“Look at the import tariffs, which I fully understand are there to protect the local industry. But they must be competitive. As a manufacturer of leading brands in the market place, we would like to drive down the cost to make our products more accessible to the Nigerian consumer,” he remarks.
Denying insinuations that Unilever was planning to move its operations to Ghana, Boedinger, who discloses that Nigeria is Africa’s second biggest Unilever market after South Africa, highlights some of the drawbacks of poor infrastructure and pinpoints that Nigeria has a huge unemployment problem. He maintains that with good infrastructure, foreign investors would show more interest in Nigeria.
“Unfortunately at the moment, only 4.6% of GDP is coming from the manufacturing sector. This is the opportunity we have as a society to address and create jobs for Nigerians,” he states.
While commending the Lagos State governor, Raji Fashola, on his palpable achievement in the area of infrastructure, he charged the federal government to be more consistent in the application of policies. “I think the regulatory framework is fine, but it is more of a problem of application and implementation of these policies,” he says.
Thomas Boedinger: Unilever’s Growth Machine
In just two years of his stay in Nigeria, Thomas Boedinger, MD, Unilever Plc, has been able to transform the corporate identity of the Unilever brand, helping it regain its leadership position in the market. This is attributable to nothing else other than his visionary leadership and long years of experience which he has brought to bear since arriving Nigeria.
But for Mr Boedinger, he has simply followed a basic philosophy for business and work.
“My philosophy is very simple and basic: Keep challenging yourself; keep improving yourself. Reach out to people and understand them. This is very important,” he says. But this modest submission would not hide the fact that he is clearly an expert and experienced manager of resources.
Over the last 18 years, Boedinger, a graduate of Economics, has worked in Bestfoods, Pepsi Cola and Unilever businesses, where he held positions like Product Manager, Marketing Manager, Retail Area Marketing Coordinator, Business Development Manager and General Director.
Within the eight years he spent in China – his last port of call before coming to Nigeria – he built Unilever Foodsolutions, a B to B food service business, from scratch to a company with an excess of 100 million Euros in turnover.
Boedinger became the Managing Director of Unilever Nigeria in July 2007. Between that time and now, he has turned the fortunes of the company around. Today, Unilever Nigeria is back in the driver’s seat in Nigeria’s manufacturing sector. “I am a German, born in Germany, in 1964,” he explains, as he is asked to introduce himself. “My sign is the Scorpio and my Chinese sign – a dragon. If you ask the Chinese what a dragon means it means that the person is destined to become a leader. Now, when you combine that with the sign of the Scorpio, you get an interesting mixture. I believe this is reflected in my career path,” he continues.
Mr Boedinger also traces how he has moved through the ranks over the years. “I started my career in marketing with a company called Bestfoods, which owned the Knorr brand,” he volunteers. At the age of 26, he moved to Hong Kong. From Hong Kong he moved to Vietnam to set up Bestfoods Vietnam, starting with a representative office with one employee. He spent about five years in Vietnam, during which he established the Knorr brand in the country. It was from there that he moved to China to set up a foodservice business for Bestfoods.
It is not surprising then, that when the need arose in Unilever Nigeria for a leader with creativity and a touch of dynamism, Boedinger was the first choice. “After eight years in China, I wanted to have a new challenge. And the company came to me and asked, “Thomas, what do you like?”, and I said look, “I like to be creative.” They said, ‘We’ve got something for you in Nigeria.” I told them, “I don’t know a lot about Nigeria.” But at that point in time, I had to tell myself, “Look Thomas, have the right attitude; have a look at the place.”
That was how he came to Nigeria for a brief orientation visit in December 2006, during which he spoke with his predecessor, Bob Clark, who is very well known in the Nigerian business community. In the words of Boedinger, “it took me just two days to be convinced, seeing that the business was in need of a turn around situation.”
Boedinger’s mission was clear: To deliver the turnaround, make sure that Unilever regains its former position in the market and gains the trust of the consumer, which of course translates into business opportunities. Being convinced that there are very bright business potentials in Nigeria, he has pursued this mission with vigour, and it is paying off.
But it is not ‘all work and no play’ for Mr Boedinger. To relax, he spends time with friends and colleagues. He also does a bit of sports and reads quite a lot. Yet he reveals another sport that relaxes him. “I learnt something in the army; it is called sky-diving. It is assumed that stupid people drop out of planes, right? I have been doing that for the last 20 years, but I can’t do it in Nigeria. Each and every time I go out of the country and I have the opportunity, I do it.” He says this gives him a feeling of freedom, as well as the idea of risks. “For me, to push my boundaries is something that is very rewarding. It gives me the extra drive – the energy to go further.” That is it for the Unilever boss.
