Solution
Shivagya answered on
Apr 30 2020
UBER – Business Strategy report
Executive Summary
UBER is a global cab service and ride sharing conglomerate which launched its services in Australia in 2015 after facing heavy regulation and stringent policies from the government. Adding on to the complexity of the issue was the varying legislation from one state and te
itory to another. Facing a global
and tarnishing problem due to its involvement in various scams and scandals across borders and nationalities, it has been featured in the headlines many a times for the wrong reasons. This report will try to understand the industry context in
ief for the Australian continent and try to come at an understanding of the key problems faced by the
and, locally as well as due to percolation of its global operating decisions. This report will also try give a
oad outlook of the industry’s scope and parameters of competence, trying to understand UBER’s drivers to success and popularity.
At the end of the report will be a few recommendations in view of the issues discussed and factors of growth and popularity taken into consideration. UBER’s competitive landscape and the global influence wielded by the company will play a major part in the formation of the recommendations keeping it in line with the company’s past behaviour and also taking into account actions directed by the new leadership the company is under.
Table of Contents
Executive Summary 1
Introduction 3
Assessment of UBER’s strategy 4
Evaluation of UBER’s Strategy 8
Conclusion & Recommendations 10
References 12
TABLE OF FIGURES
Figure 1 5
Figure 2 8
Introduction
UBER launched in Australia in the October of 2012, from which it has grown into a $36 million revenue generating business in 2016. Despite starting off well in Sydney, UBER faced massive obstacles ranging from being at logger-heads with the taxi industry in Australia to stringent government regulations limiting its functionality in the country and delaying implementation of its model in some of the major Australian cities such as Perth. This was despite the massive growth UBER saw in its European and other global markets at the time. In 2015, the Australian Taxation Office (ATO) that directed any Transportation Network Company (such as UBER) needs to register for an Australian Business Number and also pay a Goods and Services Tax (Australia). UBER filed a suit against this regulation for being discriminatory in nature, claiming it is a tactic to target UBER drivers in a biased manner.
UBER operates in most of the Australian states except Northern Te
itory. It has been operational in New South Wales and Australian Capital Te
itory since 2015. South Australia, Western Australia, Queensland and Tasmania had been added to Australian network in 2016, and it became operational in Victoria since 2017.
Company Overview
UBER, formally known as UBER Technologies Incorporated, headquartered in San Francisco, California, USA. The business was started in 2009 as a luxury taxi service between San Francisco and the Silicon Valley, today operating in over 600 cities across 78 countries, it is the most popular taxi service globally. According to UBER’s website, it services a customer base of nearly about 40 million people a month with 15 million trips a day.
Assessment of UBER’s strategy
UBER’s Australian operations work under the UBER B.V. arm, this report will examine and analyse the market business strategy applied, the external fit and its potential business performance. This study will take into account the publicly available information of the global UBER strategy and its Australian arm to come up with recommendations to enhance its business offerings and services in the region.
Vision & Mission Statement
UBER’s mission statement reads as, “Make transportation as reliable as running water, everywhere, for everyone”. The statement makes the purpose of the company clear, to ensure that any customer, anywhere, will have an UBER available for personal transportation if not anything else. The statement by UBER reflects the need of a Transportation Network Company to be reliable. The 3rd most important fact that can be derived from the mission statement is its availability to everyone, implying no discrimination whatsoever. This is despite the use of Greyball software by UBER to identify and deny service to certain riders, inclusive of those who are under the suspicion of being in violation of policies and terms of service.
Generic Strategy
UBER has had success in capturing the Australian market, a major contributor to this being the absence of a need of expensive Taxi licences and hence UBER rides are cheaper than you regular cab rides. Despite a lot many local start-ups in the Australian market place like SwyftRyd & GoCatch, which haven’t really been able to gain a lot of traction in the market, UBER is still remains the most popularly used ride sharing application. One of the main reasons for this monopoly in the ride sharing space is due to the fact that neither do the customers order a lot many cabs apart from UBER and hence there is no incentive for drivers to switch over to any other platform and if should a customer try and book a cab from any other service, there are usually no drivers around forcing the customer to switch back to waiting for an UBER. Though UBER’s global competitors do seem keen on entering the market with Lyft & Shebah eyeing the market place and Ola, an Indian upstart, starting driver recruitment in Sydney, Perth and Melbourne early in 2018. Taxify, a...