Monday 17 February 2020

All Business is MMM: A Case Study of ORide -By Olatuja Gabriel-Wealth

SHARE




I'm sure you were trying hard to relate MMM with ORide and can't find any connect.

This article is aimed at showing you that every business has its own level of risk.

A couple of years ago, during the recession time, there was a popular ponzi scheme called MMM where people donate money to themselves in form of "Get Help" and "Provide Help". This scheme was so structured globally and had a session in so many countries, including Nigeria.

MMM was going on smoothly in Nigeria, people were happy to donate to each other. People of different classes from down-dog to the rich did MMM. So many people diverted their school fees, family funds, personal funds, company's funds into MMM and they were GHing and PHing without problems.

At a point, a lot of people were raising all sorts of suspicion about the scheme. Those whose businesses were also at a disadvantage owing to the scheme were also giving reasons as to why it should be stopped.

One of the main reasons is that the scheme didn't have a product or service they were trading, hence, no value.

They called on government and decision-makers in the country to clam down on the participants of the scheme. The participants at that point were panicking and so many couldn't put in money into the scheme.

Within 24hours that the National Assembly called for the investigation of MMM, there was tension in the systems and those who have money in the scheme were trying to withdraw. At a point, no money to withdraw, as people were not willing to pay in, hence, that those who wanted to withdraw could get funds. That was how MMM crashed.

The other part of this article where I will use the case study of ORide (a bike operator in Lagos). The international investors invested millions of dollars into the company, there were bikes everywhere in Lagos.

ORide came to play in the quest to solve the problem of traffic and transportation from one place to another, faster and cheaply.

Through the company, so many youths were gainfully employed both at the upstream and downstream level
The operator of ORide also got a licence from the State government led by Mr Akinwumi Ambode in Lagos. The company contributed to the increase in Lagos State Internally Generated Revenue.

On assumption of office of another governor,  Mr Sanwo-Olu who banned bikes from major roads in Lagos, ORide and its counterpart were forced out of business.

A since threat by decision-makers crashed MMM and single government policy led to the end of the multi-billion dollar investment Oride.

In strategic management, I learned that there are factors that can affect a business which is put in the acronym "PESTLE".

What is PESTLE Analysis? A Tool for Business Analysis

What is PESTLE Analysis? PESTLE analysis, which is sometimes referred to as PEST analysis, is a concept in marketing principles. Moreover, this concept is used as a tool by companies to track the environment they’re operating in or are planning to launch a new project/product/service etc.


PESTLE is a mnemonic which in its expanded form denotes P for Political, E for Economic, S for Social, T for Technological, L for Legal and E for Environmental. 

Every business has a level of risk, either calculable or incalculable.
From PESPLE, a single political change or decision may make or mar a business or an idea. It happened to MMM. It happened to ORide.

A lot of people have invested heavily and owning to a bad economy, they loosed all their investments. Also for some socio-cultural, technological, legal and environmental reasons, a lot of investors have loosed their funds.

That's why I concluded by saying all business is MMM. Businesses do well if all these factors are favourable and vice versa.

If you dispute this argument, please leave a comment and let's discuss. This will be a guide for those who want to invest in one industry or the other.

Written by Olatuja Gabriel-Wealth ([email protected])
SHARE

Author: verified_user

0 comments:

Kindly comment here!