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Brandon Robinson

BA- 3305 Organization Management

Word Count = 1,900

May 1, 2014

Mobile payments start-up Yoyo sees campus

opportunities

By Johnathan Moules (2014, April 28). Financial Times

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A new entrepreneur based business called Yoyo created a Smartphone app-based system

and enters into an increasingly crowded market for technology. This app-based system is

designed to make the purchasing process easier and less expensive. Dave Nicholson, Michael

Rolph, and Alain Falys founded this business. This new business can be analyzed and compared

to chapter 5, Strategic Planning And Decision Making, from the management textbook.

The Yoyo app was created by Independent entrepreneurs who previously worked for high

up jobs such as Visa and Paypal. This mobile app is aimed at replacing cash and credit cards

when it comes to retail stores by giving the consumer the ability to have the barcode from the

app scanned to pay for the transaction. The incentive for the consumer is the app allows them to

collect rewards from numerous retailers without having to carry around reward cards, plus they

can share them with friends. The incentive for the retailer is that the Yoyo app supplies retailers

with intelligent software that allows them to see the buying habits of their customers.

By taking a look at the planning process one can better understand what is in store for

entrepreneurs trying to start a business. Planning gives a business and its employees a road to

follow, and every business should go through the six step planning process so that it arrives

safely at its destination. The six step planning process consists of analyzing the situation,

generating alternative goals and plans, goal and plan evaluation, goal and plan selection,

implementation, and monitoring and controlling. Starting with step one and then consecutively

going through the other five steps analyzing and comparing them to the article which discusses

the new Yoyo business, will shine light on what we know this business is doing now and what

they may do in the future.

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Step 1: Analyzing the situation, planning begins with a situational analysis, which

involves gathering, interpreting, and summarizing all information relevant to the planning issue

in question. Ben Rubin mentions that mobile device application (app) industry, as of March

2013, is growing rapidly but is also highly competitive, with the result that many start-

up app development companies fail. Yoyo is entering into an increasingly populated

technological market and it is crucial to know that this market is fast paced and highly

competitive with many entrepreneurs in the mobile phone payments market ambitiously trying to

become the next big thing. They would also need to know other companies with similar ideas

such as the Google Wallet app, which allows customers to use their phone to pay for

transactions. With Google being a “big-dog” in the Internet market, knowing about them and

other competitors and what they are doing is necessary for a new company to create goals, which

leads us into the next step.

Step 2: Generating alternative goals and plans, based on the findings from the situational

analysis, the planning process should generate alternative goals that may be pursued and

alternative plans in order to achieve those goals. Yoyo’s main goal is aimed at getting people to

use their app at retail stores to make a hefty profit. Some short term goals that the business has

would be getting investors involved so the company can get its feet on the ground so it can first

walk and then run. Other short-term goals are getting the first crowd to download the app and

also getting the first few retail stores to accept the idea and use the Yoyo process. A goal that

will take place after the previous goals will be going from a few retailers and the small initial

group of customers to an expanding amount of retailers and customers. Their plan is to target

high-volume, low-value transaction retailers in order to get the maximum amount of transaction

because they charge the lowest possible percentage on each transaction to cover its operating

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costs because it plans on making the bulk of its profit from additional fees for setting up

marketing tools, such as discount vouchers and a completely online loyalty card system. To

reach the short-term investment goal the business planned to intrigue past colleagues and also

went to Startup Alley, which is an event designed for up and coming technological businesses to

meet with investors who may be interested. The Yoyo team planned to get the first crowd of

customers and retailers by using a strategy like the one Facebook used, which refers to the way

the multibillion dollar social network first gained a foothold at Harvard. This single-use plan

would start at Imperial College campus in London by getting the students to download the app

and the bars and cafes on campus to accept and use the app and technology as well. Yoyo

believed that this would create a critical mass of users spreading to other London universities,

which would then spread to other outside retail stores getting them to adopt the technology. Also

there should be contingency plans that specify actions to take when a company’s initial plans do

not work as efficiently as expected. This could and should be applied to each goal that was made,

for example, if after the app took hold and became successful at the universities and the outside

retailers were not adopting the technology, the company could have plans to meet with retail

companies in order to persuade them to adopt their technology. After the goals and plans are

made the company then has to check them before they are implemented, which leads us the next

step.

Step 3: Evaluating goals and plans, The Yoyo management team would need to look at

goals an plans from all angles to see the advantages, disadvantages, and potential effects of each

them. They must prioritize the goals to see which one would be best fit for them to reach higher

goals such as getting a huge mass of retailers and customers and also to find the plans that will

help them reach the goals. Not knowing the exact process that Yoyo took, one can speculate that

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the goals that they did use were considered valuable at this step. The business’s goals to get

investors involved may have started with only one plan which could have been discussing the

idea with past colleagues, but at this step this would be evaluated and the results could have been

that this would not be sufficient enough to raise the capital needed to make a full initial launch or

to run the business. This would then send them back to the generating step in order to create

another approach, or they for saw it from the beginning and made a contingency plan were the

business would meet with retail chains and strike a deal. If you look at the plan that is suppose to

take them from the initial start at the Imperial College of London to the intended mass of

retailers and customers that they want, you might think that when they evaluated this they saw

that it would be best to add another approach to make sure they reach their goals. After the

company evaluates all of the goals and plans that were generated by step 2 of the process they

then have to select which goals they will keep, which takes us to the next step.

Step 4: Selecting Goals and Plans, once managers have assessed the goals and plans, they

then select the most appropriate and feasible alternative. The first four steps of the planning

process generate planning scenarios, which are narratives that describe a particular set of future

conditions, and has a contingency plan attached to each scenario. Managers in step four pick the

plans with the most likely scenario; for example, Yoyo used the plan similar to Harvard to get

the operation on the ground but shortly after they started meeting and making deals with several

UK-wide retail chains. Meeting with the retail chains could have been a contingency plan

attached to the scenario that was evaluated as the best and most probable. Also, the business

decided to get investors involved by talking to past colleagues and by attending the Startup Alley

event. These plans were both evaluated and needed in order to get the capital necessary to go

from what they call the seed round to getting outside retailers wanting this technological app.

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Once the goals and plans are selected it is time to implement them, which is the next step in the

process.

Step 5: Implement the Goals and Plans, proper implementation is key to achieving goals.

Managers and employees must understand the plan, have the resources to implement it, and be

motivated to do so. Looking at the actual strategy that Yoyo took we will see how successful

planning, does, follow these six steps. Yoyo, after creating the idea and figuring out a strategy to

attract retailers and customers, went to past colleagues and to the technology investment group

from Imperial College and collected enough capital to launch the app. They first launched the

app at the Imperial College where 20,000 students and staff on its main campus signed up. Yoyo

then started targeting retail chains in the UK to get bigger and better retailers involved. The

company then attended the Startup Alley event to intrigue investors and spread their idea

throughout the community. This app is taking root in the UK community and is starting to

spread; this app is a modern idea that was founded in May 2013 and has been funded 6.5 million

dollars. But even though this business is making progress, without monitoring and controlling

performance the business will never know if it is succeeding, which leads us to the final step.

Step 6: Monitoring and Controlling Performance, without this step a business would be

driving down a road but would not know which road. This step lets the managers know if goals

are being met and if plans are working. Also, control systems must be implemented in order for

managers to know that the intended plan is being properly followed. A company could have

reasonable and objective goals and plans that when implemented correctly will accomplish goals,

but if these plans are not followed the way intended then confusion and problems can form. Take

for example, if Yoyo implemented its Imperial College plan which expected it to start there and

then spread like wildfire but never monitored the results, the goal of getting many big outside

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retailers would have most likely never happened, and if it did it would have taken longer than

what the goal had intended. Looking at this same example, without a control system properly

implemented this plan which involves getting the students and staff to download the app but also

the bars and cafes as well, could have been implemented improperly by not involving the bars

and cafes. If the bars and cafes were not given the technology the students and staff of the

campus would have no purpose or way to use the app.

Yoyo can be analyzed by looking at the six steps involved in the planning process.

Looking at these steps you can more fully understand the decisions and actions carried out by

this entrepreneurial business. Also, it gives you insight on how to successfully analyze the

situation, generate, evaluate, select, and implement goals and plans, and to monitor and control

performance by comparing the process to the actions taken by this new business.

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Works Cited:

Moules, J. (2014, April 28). Mobile Payments Start-up Yoyo Sees Campus Opportunities. Financial Times. Retrieved from: http://www.ft.com/intl/cms/s/0/2d2ce34a-cbd1-11e3-9f27-00144feabdc0.html?siteedition=intl#axzz30MJKJEcZ

Bateman, T. S., & Snell, S. A. (2013). Management. New York, NY: McGraw-Hill Companies, Inc.

Rubin, B. F. (2013, March 8). Few New App Ideas, Even Fewer Hits. Wall Street Journal, Vol. 261 (55). Retrieved from: http://web.b.ebscohost.com.lib-e2.lib.ttu.edu/\

Butcher, M. (2013, sep. 10). Yoyo raises $1.2M to launch new kind of mobile payment and loyalty platform. Retrieved from: http://techcrunch.com/2013/09/10/yoyo-raises-1-2m-to-launch-new-kind-of-mobile-payment-and-loyalty-platform/