The ISIL franchise

Right now intense negotiations are going on at the UN Security Council regarding Libya and the Islamic State in Iraq and the Levant (ISIL).

The Libyans want an arms embargo lifted so they can secure the weaponry needed to fight the group, which has brutally murdered Egypt’s Coptic Christians working in Libya and travels with impunity in Libyan territory in large convoys.

Without understanding how they operate it's unlikely they'll be defeated.

by Imran Khan, Al Jazeera

In Nigeria, Boko Haram have managed to delay elections and have increasingly publicly come closer to ISIL, developing a media campaign that’s closer to ISIL’s in execution, and referring to themselves as the Islamic State in West Africa.

In Egypt, the group Ansar al-Beit al-Maqdis has also changed its name, going now by the moniker ‘Sinai Province’ and has pledged allegiance to ISIL.

In Pakistan some factions of the Pakistani Taliban have declared they are backing ISIL and share its goals.

On the surface, ISIL is developing into a global outfit with a reach far beyond its self-declared and internationally unrecognised borders in Iraq and Syria.

Quite simply, ISIL is franchising out its brand to other groups and becoming the pre-eminent armed group. In that sense it’s aping successful business models and it’s a smart move. The only difference is that in the business world a franchise agreement comes with a contract. For ISIL it comes in the form of a pledge of allegiance or a show of support.

ISIL’s ‘corporate structure’

Amanda Rogers is an academic who has lectured extensively on ISIL’s rise as a corporate structure.

“ISIL acts like a corporation because it works, it adopts corporate logic, as it is increasingly the manner in which effective governance is conducted and adopts branding.

The ‘black flag’ makes an impact for both audiences terrified of an imminent global khilafa, as well as those eager for such a creation. Consumers will identify with a recognisable brand and that helps with expansion,” she said.

What separated ISIL from other rebel groups was its organisational skills. ISIL operated with a clear, top-down management structure. Using money initially from Saudi sheikhs, it consolidated territory through aggressive expansion.

Once again the parallels can be drawn between business and Jihad. Imagine a company in tech industry that sells software en masse. To keep market dominance it’s often cheaper to take over smaller competing companies and shut them down or fold them into your existing business than it is to compete with them.

That’s what ISIL do. They would arrive at the outskirts of a town, and send in an emissary who would give the towns leaders a stark choice. Join us or die. Sometimes whole towns would fall in Syria without ISIL firing a shot, other times the takeover would be bloody.

Switching to organised crime

In June ISIL went further, pushing into Iraq using the same tactic. They met little resistance. The reputation had spread; the aggressive takeover doctrine worked.

Like all businesses, ISIL needs cash and cashflow management to keep going. In ISIL’s case they taxed the territories they took, took over running of civil services and began to sell oil and other high-value goods including Syrian antiquities. ‎

Sajad Jiyad is a director of research for the Iraqi Institute of Economic Reform. He said the financial side of ISIL will be difficult to defeat unless the group is tackled as a whole.

“The military effort, if it succeeds, will push ISIL underground, if the financing and ideology are not tackled. This has happened before and with other groups. So the military effort by itself can be successful without totally effective at destroying ISIL.”

In that case ISIL can switch from ‎corporate to an organised crime entity and live to fight another day.

However, the group isn’t thinking about defeat. Like all good business models, ISIL is diversifying. Its media division pumps out videos and there’s a glossy magazine called Al Dabiq. All share a synergy, a common theme.

ISIL’s ‘target market’

Another comparison of the way ISIL operates as a corporation is competition.

Much like the much-publicised rivalry between Coca Cola and Pepsi, ISIL also has a major rival: al-Qaeda. ‎The target market for ISIL is the same as the soft drinks giants. Consumers.

In ISIL’s case, it’s all about getting sympathy for its actions and recruits to its cause. That’s why ISIL created the state, and it is why they choose brutal, headline-grabbing methods of murder.

The more publicity, the more ‘consumers’ of its product and the more it can further franchise its brand and the more successful it becomes against its rival al-Qaeda.

ISIL even has a core target market that it pitches to. Sunni Muslims, who fear a Iranian Shia-dominated region that’ll subjugate the Sunni’ further.

Every ISIL move, every message, everything it stands for is singular. In corporate terms, ISIL is associated with one key attribute. Representing Sunni anger, much the same way Coca Cola is about sharing a moment with friends. That’s a powerful advertising message.

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But ISIL’s ambitions go way beyond just operating as a corporation. ‎The corporate structure is a means to an end. The end is a legitimate state recognised by the world.

It’s unknown whether any of the leaders ‎studied business but regardless of whether they have or not, the rules have been applied.

With a variety of groups globally now joining or openly supporting the group, ISIL have cemented the one thing all business want. A valued brand that can be transfered across terroritory.

Whether they can make the jump from corporation to state is unlikely, but without understanding how they operate it’s unlikely they’ll be defeated.