PEOPLE-SELF REALIZATION IN NEW FORMS OF ENTERPRISE

An examination of the role and importance of individuals in enterprise, despite the changing face of
business in the 21st century.

In his famous treatise, The Wealth of Nations, Adam Smith wrote that “the propensity to
truck, barter, and exchange one thing for another” is an intrinsic characteristic of human
nature. In recent times, this propensity to trade has become the major determinant of the
kind of relationship existing between not only peoples, but also nations. New alliances
such as the Organisation of Petroleum Exporting Countries (OPEC) and the European
Union (EU) threaten to monopolise the direction of trade among individuals and nations.
The recent drama in which the European aeronautic company, Airbus, overtook its
American counterpart, Boeing, after years of manipulations by the EU is proof of the
power such alliances now wield over us. Also battling for this position (or perhaps they
complement each other) are the series of multinational corporations (MNCs) now dotting
the horizon. In future years, these corporations might dictate to us how we sleep, eat and
dress. The spectre of these organizations are not false and their impact on nations and
people could be disastrous: Nigeria’s crushing debt of about $35 billion dollars to the
Paris and London clubs and the way it has shaped our national and economic policies is a
case in point. Gone are the days of the entrepreneur. Gone are the days when a man could
single-handedly decide what to produce and what to trade and barter. We seem to have
become mere pawns of these conglomerates and regional powers. At least, this seems to
be the prevailing attitude of the times.
But is it entirely true, that in the equations of 21 st century enterprises, in the age of
globalization and free trade, that the human factor is so insignificant? Careful studies of
past and recent trends indicate otherwise. Like old times, the world still belongs to
individuals who venture out with the strength of their convictions.
In ancient times, commerce was restricted mainly to local markets. What people
neither grew nor gathered themselves, they obtained through trade. But as human wants
and needs grew, commerce began to traverse the boundaries of local markets. Individuals
who needed new markets in which to offer their products, and so escape suffocation by
‘mini-cartels’ pioneered this move which soon translated into long distance commerce.
 As merchants began to form associations, long-distance trade became safer. The
development of ocean-going vessels and the subsequent cost reduction in transportation
in the 15th and 16th centuries led to a rapid expansion of international trade. This gave
birth to new forms of commercial organizations. Legal partnerships were born out of
informal associations. Shareholding broke down social barriers and made possible
international trade for small traders.
In the 18th century, the industrial revolution was born. The revolution has been
rightly attributed to the development of steam power and other inventions. But more than
technology or resources were involved: enterprise was required. While society gained in
terms of creation of wealth and the production of jobs (between 1750 and 1914, world
trade increased in value fivefold), it was a few enterprising individuals that reaped most
of the gain. Unfortunately, while the American and European countries which were rich
in human resource developed and became trade partners, regions such as Africa, rich only
in natural resources, became heavily dependent on foreign markets.
This same trend can be seen in the post-war eras of the 20th century. Due to
efforts by organisations such as the World Trade Organization (WTO), exports more than
doubled in volume and increased eight times in value between 1954 and 1974, but not all
countries shared equally in this growth. Exports from the industrialized nations of North
America and Western Europe expanded rapidly, while exports from developing countries
fell behind. Again the determining factor in the balance of trade of trade was obvious: the
presence or absence of human capital.
International trade in many products is dominated by a few private companies –
five car companies control 54% of world automobile production. These powerful
companies are all concentrated in the northern hemisphere where literacy levels are very
high. But more important, they are mostly founded by people who in the face of stiff
opposition, had strange ideas of great proportions, mobilised capital to power their
dreams, and forged ahead. Akio Morita and Masaru Ibuka would found Sony and become
world leaders in electronics, in spite of companies such as Toshiba and Texas
Instruments, from humble beginnings as manufacturers of cooking stoves; Micron, a new
company with small capital outlay, would breakthrough in 64K DRAMS after the failure
of giant companies and billions in research funding. All these point to one single fact as
illustrated by George Gilder in The Spirit of Enterprise; “…the crucial capital of industry
is not money or machinery, but mind and spirit…”
Now in the 21st century, though the face of enterprise has changed, the challenges
and opportunities facing us are still the same. Globalization and free trade have led to
outsourcing and offshoring and these are progressing on a massive scale. By the late
1990s, 60,000 Transnational Corporations with over 500,000 foreign affiliates accounted
for about 25% of global output. The benefits of globalisation are numerous: the
percentage of people in developing countries living below $1 per day has halved in
twenty years; life expectancy has almost doubled in the developing world since WWII;
child mortality has decreased in every developing region of the world; Income inequality
for the world as a whole is diminishing; global literacy increased from 52% to 81%
between 1950 and 1999. There are similar trends for electric power, cars, radios, and
telephones per capita as well as access to clean water.
Again the key words are knowledge and entrepreneurship – the human resources
– and this explains why Africa, according to the United Nations Environment Programme
(UNEP), is the only region in the world where poverty is expected to increase in the 21st
century. Individuals would always play significant roles in new enterprises: individual
vision would always prevail over the corporate leviathan. The question is “who will
choose to be relevant?” Bill Gates, a young dropout who saw the future, built a company
that has surpassed IBM, the goliath of the computer industry, and is now the richest man
on earth. But it takes first of all a realization of the power of the human resource.
The rise of the techno-capitalists has also brought about a rush of change and
unprecedented wealth. They hope to turn workers into free agents and, via the Web, give
everyone the same access to information and markets. The new Internet, they say, will
end the cultural isolation of poor countries and poor people. Information and
communication technology has placed at our disposal the tools needed to compete
favourably with the largest corporations. No longer does an entrepreneur need to travel a
thousand miles at great cost to trade; a phone-call will do. The internet will provide him
whatever information he needs and allow him to send information to a partner half-way
around the globe in an instant. Markets are migrating to cyberspace or some combination
of physical and virtual space. This free access to markets puts everyone on an equal
footing with the largest organisations.
The stock market is another tool that has made it easier to ‘play with the big
boys.’ With a small amount, it is now possible to co-own the largest of corporations. The
stock market is the only market ever where a man could make a billion dollars and lose it
all in a minute. Consider the explosion of the Nigerian stock market in 2003 when people
had their wealth multiplied several times over all for having the right stocks. Warren
Buffet, the second richest man, employed this tool in getting where he is today. Those
who hope to play important roles in the industries of the future must understand the skills
that will be required and strive to acquire them.
When Sabeer Bhatia, an Indian, first came up with the idea for Hotmail, he was
rejected by a series of venture capitalists. As a ‘person of colour’, he naturally felt he was
a victim of discrimination. But, he “… quickly realized that being foreign born was no
barrier, it was only a barrier in my mind.” Now he has set up his own ‘curry network’,
complete with regular deal-generating powwows, an annual conference, a magazine, and
a web site.
The barriers are all gone. Globalisation though a threat in many ways, is also the
greatest opportunity for self-fulfilment that has come man’s way in the history of
commerce. The seeming impossibility of building something great from the scratch in our
times is simply an opportunity for us to test our limits. It serves as a sifting ground for
those who cannot pursue their dreams and for those who find it difficult to forgo present
consumption. The western world pioneered the age of enterprises and is steadily forging
ahead; the Asians are fast catching up. We must not be left behind.

BEECROFT John O.
Jul 2005

REFERENCES
Microsoft® Encarta® Premium Suite (2004)
Smith, A. (1776). The Wealth of Nations.
Gilder, G. (1984). The Spirit of Enterprise.
Wikipedia, 2005, (www.en.wikipedia.org/wiki/Free_trade)
Global Policy Forum (2005). New York, NY 10017, USA, (www.globalpolicy.org)