After the publication of my last article on the world fighting WWIII with the Coronavirus, a number of people requested an article on the impact of the virus and lockdown on businesses in Nigeria. This second article is written to respond to the request of the readers.
What is a PESTEL Analysis?
A PESTEL analysis is simply an acronym for describing the strategic management tool used for scanning the operating environment in order to identify key macro (external) factors that influence an organisation or a country. Each letter in the PESTEL analytical framework stands for Political, Economic, Social, Technological, Environmental and Legal factors.
Let us look at the impact of COVID-19 on the political, economic. social, technological, environmental and legal factors in Nigeria.
1. Weakened governance capacity
2. Suspension of direct diplomatic relations
3. Delayed signing of bilateral and multilateral agreements
4. Prevent governments and their agencies from discharging direct oversight functions because of fear of infection and death.
There are others. What are your thoughts on the political impact of COVID-19?
1. Shutdown of business activities
2. Inflation and hike in prices
3. Cut-off of supply chain
4. Disruption of business activities of artisans
5. Fall in oil prices
6. Reduced income from taxes including VAT
7. Temporary unemployment for some and permanent loss of jobs and incomes for others
What are your thoughts on economic impact of COVID-19?
1. Shutdown of places of worship
2. Shutdown of recreation centres
2. Compulsory observance of social distancing including self-isolation for some
3. Evolving new ways of social and cultural interactions.
4. Disruption of weddings, concerts, sports, conferences, parties and other social events
5. Restriction on freedom and social liberty of people
6. Emergence of new ways of greeting and strange social interactions
What are your thoughts on social impact of COVID-19?
1. Widespread E-activities: E-governance. E-commerce etc
2. Increased relevance of ICT softwares and applications
3. Increased online social interaction
4. Increased acceptance of online education and training for students
5. Emergence of forced online Communities
What are your thoughts on technological impact of COVID-19?
1. Increased environmental awareness for the people
2. Growing concerns about personal hygiene by the people
3. Increased used of sanitizers and disinfectants
4. Proliferation of dangerous substances in the public domain as sanitizers and protective masks
5. The earth is heavily abused with toxic materials, pollutants and life-threatening biological weapons.
What are your thoughts on environmental impact of COVID-19?
1. Curtailed fundamental human rights
2. Delayed dispensation of justice
3. Increased used of force on people
4. Close down of courts
5. Inability to conduct due diligence on legal aspects of businesses
6. Forced decongestion of prisons/amnesty
What are your thoughts on legal impact of COVID-19?
In view of the foregoing impacts, what are the suggested coping strategies for businesses and entrepreneurs in Nigeria. Tapping from the insights from professionals and articles written on this subject in recent weeks, the following strategies are suggested:
1. Readiness Assessment Strategy: This involves accepting the reality of the present problem, and pragmatically assessing your organization’s readiness to run your business safely and productively following the business rules and best practices including operating standards set by governments and health authorities.
2. Risk Management Strategy: Managers at this time should carry out a risk assessment on their core business activities and processes to identify and prioritize observed risks, especially the direct impact of the Coronavirus pandemic, likely economic recession, and geopolitical conditions risks. Involve your key staff members to identify the impact of the above itemized risks in their respective departments or areas of responsibility.
3. Business Impact Analysis Strategy: As managers, you are expected to conduct a business impact analysis for the purpose of identifying which parts of your operations are most critically affected or vulnerable to the negative impacts of the Coronavirus pandemic. From the outcome of the analysis, the operations of the organization are prioritized to ensure business continuity plan during the crisis.
4. Policy Management Strategy: The outcomes of the risk assessment and business impact analysis, will require the need for managers to review existing policies and procedures to align with the crisis era. There is need for new policies and procedures on WFH work ethics, supervision, monitoring, KPIs, discipline and compensation. New policies and procedures must be clearly communicated.
5. Incident Management Strategy: As business managers, we must be ready to manage critical operational problems in our companies under risk situations or working remotely from home. In the COVID-19 period direct monitoring of activities is impossible and fixing of problems face to face through management by walking around is also impossible. The appropriate medium for monitoring and fixing operational problem is deploying an enterprise-wide incident management system that provides employees a platform to escalate critical incidents and concerns for prompt turnaround remedial actions by their supervisors.
6. Emotional Intelligence Strategy: Business coaches assert that managers and entrepreneurs need EIS more at this time to cope with the impacts of the Coronavirus pandemic because business disruption is a test of people’s emotional and social operating system and functioning. It is instructive to know that tough times don’t last, but tough men do business that possess the requisite emotional intelligence to cope with crisis situations.
The 4 key domains of EI are self-awareness, self-management, social awareness, and relationship management.
Moreover, Charles Darwin remarked that “Those who survive are not the strongest or the most intelligent, but the most adaptable to change.”
At this period, the enterprise owners need to practically reflect empathy, resilience, optimism, and flexibility in the running of their businesses.
From critical incidents analysis, the Ten Post-COVID-19 Businesses in Nigeria would be the following:
1. Online Learning & Management System
2. Disasters & Emergency Consultancy
3. Health Care Delivery Services
4. Industrial Cleaning and Laundry Services
5. Food Technology and Production
6. Agriculture/Farming of all types
7. Food, Products and Services Delivery Value Chain Businesses
8. Real Estate Businesses
9. Hygiene Products manufacturing
10. Corporate Private Cab Services
The predicted economic recession after COVID-19 will have the following impacts:
1. Value of Naira would crash and is crashing already
2. Savings of ordinary people will vanish because they will keep on withdrawing their money for food and basic things of life that are already inflated
3. Investment in stocks will crash as people will desert the stock exchange for more predictable investment options.
4. One of the best investment options is to keep idle money in dollars as an hedging option.
5. Buying government bonds is also a secure investment, but it is interest -based. Sukuk option is therefore recommended for ethical investors
6. Finally, this is a good time to buy properties or put huge investment into real estates for people with long term investment orientation. For basic survival, most people that are desperate to make ends meet will sell their lands and property.
In conclusion, I have reiterated at several platforms, that the Coronavirus pandemic has unveiled the weaknesses of human and technology. COVID-19 may be a corrective measure from God to correct all abnormalities committed on the surface of the earth by the arrogant humans.
The lockdown foisted on the world necessitated by COVID-19 has provided the entire humanity a unique opportunity for a reunion with God spiritually, socially, economically and politically. The existential threat of the virus has re-emphasized the dire need for humans, businesses and countries to live peacefully.
▪︎ By Dr. Lukman AbdurRaheem, American University of Nigeria (AUN) and Amir, The Muslim Congress (TMC)
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