Analyzing the Impact of Macro Environment on Business Strategy of UBER

This report analyzes the influence and impact of the macro environment on the business strategy of UBER. It includes a PESTLE analysis, stakeholder analysis, SWOT analysis, and Porter's five force model evaluation.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Apply appropriate framework to analyse influence and impact of macro environment........3
TASK 2............................................................................................................................................7
P2 Analyse the internal environment and capabilities of a given organisation..........................7
TASK 3............................................................................................................................................8
P3 Porter's five force model to evaluate competitive forces of market.......................................8
TASK 4..........................................................................................................................................10
P4 Implement the range of theories, concepts and model to devise strategic planning of
organisation...............................................................................................................................10
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
The term business strategy is understood as a course of action and the set of decisions
that assist an entrepreneur to accomplish specific business objectives and goals. In simple terms
business strategy is defined as a master plan that is used to obtain a competitive position in
market through performing all business operations and functions according to goals of
organisation. Business strategy is recognising as a set of competitive actions and moves that are
aim towards gaining the attraction of buyer or customer's. This report is written from the
perspective of UBER Technologies which is a commonly known as UBER. They deal in the
vehicles and hire to deliver courier, fright and transportation services (Bereznoi, 2015).
Moreover, this report highlights on PESTLE, SWOT and other framework to understand impact
and influence of macro environment on business strategy of organisation. Porter's five force
model will also implement to understand competitive forces of market.
TASK 1
P1 Apply appropriate framework to analyse influence and impact of macro environment
PESTLE ANALYSIS:
It is a framework of measuring the external environment of the organisation that may
impact on the performance of the company. This analysis is used specially in the new business,
so that firm can study the political, economical, social, technological, legal and environmental
factor of external environment, also help to examine the opportunities and threats for the
organisation. It helps in planning and decision-making as well.
Company do PESTLE Analysis to measure the macro environment of the organisation
that will help in making marketing strategies and pricing policies by which firm will growth
continuously (Ambroise and et. al., 2018).
PESTLE ANALYSIS OF UBER AS UNDER FOLLOWS:
 POLITICAL FACTOR- This is a factor which have influenced by the change in
government taxation policy, labour law, foreign trade policy, corruption and government
stability. If there is a change in such policies then it will affect the organisation, these
factors came in consideration after analysing the potential market and firm have to
respond back according to the existing government policy. Uber has faced endless debate
globally. Increase in Uber share affecting the traditional taxi services badly in the

different which leads to rejection of approval in several locations. It has direct impact as
both prons and cons over the working standards of Uber as induce disruptive effect on
other traditional taxi services. The government laws is always been concerned as per the
service provide that commandment taxi services. In addition governance takes an
initiative to seized Uber as if driver didn’t have permit to drive taxi. In this Uber ensures
that there drivers having licence and follow all the rules and regulations of government.
 ECONOMICAL FACTOR- This factor is having a significant impact on the organisation
that how firm doing business and how profitable they are doing. It includes government
expenditure, taxation policy and interest rate control, also impact on the economy and its
performance. Uber is handling looses for long time also have to work with different
pricing strategies that impact on the organisation's business plan (Brașoveanu and Bălu,
2014). There are major impacts on sharing mobility by the pandemic in which Uber have
to change its strategies to work in a dynamic environment. Company is also offering food
in affordable prices with wide variety. Uber also share in the economic advancement and
it is dependent on intellectual and physical resources. The company provides higher level
of employment opportunities and in addition also provide lower cost services. In order to
get over from economic recession Uber maintain incredible services as of in low prices
by which exceptional quick is induced in terms of profit generation.
 SOCIAL FACTOR- These is the factors which influence the attitudes and shared beliefs
with the range of religion, money, health, culture, and demographics of the population.
This impacts the buying behaviour and customer preferences for the product, Like in
remoter area, there is no introduction of Uber cabs, people are not aware of these
business. These needs to come in consideration for proper advertisement of such business
so that everyone can avail the benefit, also company could expand the market. Uber has
67% market share for cabs and a 24% market share for food delivery. The customers of
Uber are happier due to its services as easy management of service through Smartphone
make it easier and friendlier. There offered price of Uber is more less than other taxi
service provider by which ability of company to spread more awareness is enhanced.
 TECHNOLOGICAL FACTOR- Technology is something that effect the way you make,
distribute and communicates to the user of their product and services. Technology
innovation and development of the product to meet the market demand of potential

customer. Uber have advance technology by advancement of new product and increases
the product range. It will help in the competitive environment to be the leading and
prominently using innovation in their products. Firm introduces the self driving cars and
accessibility of internet and smart phones endlessly, which will leads new opportunities
to various business (BURKE, ROBINSON and Choi, 2020). Uber also offering food
service in just one click, easy selection of various food items with quick service.
Innovation is the basic prospect for Uber as its function of ride sharing induces incredible
experience by which possible modification is induced with perfection. In addition Uber
also added more advancement such as geo-location, message pop-up by which significant
development in induced and it furthermore improvise instinct purpose of advertisement.
 LEGAL FACTOR- A firm should be aware of all the rules and laws that have be
followed by every organisation or should operates the function within the boundaries.
Uber being a transportation industry have to pay great fine if not following the rules and
laws, Company has also paid fines for not following right distribution of wages. Uber
shares a platform under which customary administration is charged up. In its driver has
filed a complaint about of low wage thus to value the human capital is a biggest challenge
for company.
 ENVIRONMENTAL FACTOR- These factors influence the surrounding environment
and impact of ecological aspects. Company should contribute to CRS (Corporate
Sustainability Responsibility). Uber has launched a campaign UBER GREEN, in this
passenger can request a ride which has electric or hybrid cars on Uber. The company
always maintain clear focus about to increase sustainability and for this manage its fuel
consumption, traffic congestion. In addition Uber also launch pilot project in which rider
make their request of green ride and it is at a couple of buttons.
STAKEHOLDER ANALYSIS:
It is a process of grouping of people according to their level of participation, interest and
influence in the product. It is done before the project begins and makes best use these people to
involve and communicate to each stakeholder group. The purpose of this analysis is to enlist the
efficient employee that will help in business growth (Chand and Tung, 2014). It help in early
execution of plans and goals. Stakeholder analysis of a problem consists of maintaining and
weighting all the competing demands, which need to be procured by the organisation. Uber is

influence by the stakeholder as it gives the new ideology and business plan. Company is doing
this analysis to get their efficient employee and procure the funds with proper decision making.
STAKEHOLDER INFLUENCE OF STAKEHOLDER
Customer The consumers are the important stakeholder, which directly affect the
operation of the company, as they have invested time and being loyal to
organisation. Uber is being influenced by the consumer by their taste and
preferences. Company should keep in mind while planning the product
development, It help to meet the customer expectation.
Investors These are stakeholder who procure funds and of that stakeholder are
interested in decision making (Denning, 2014). Adam Leber: Leber is an
American businessman, investor and skills manager, with his marquis
clients including LSD, Labrinth, is a investor in Uber. Investor is highly
interest and has power to take decision.
Society These are factor which are influence by the environment, Society have
major impact on organisation's profitability as society contribute to the
growth of the firm. Uber introduced the Uber green by which rider can
request a ride which has electric cars.
Employee These are highly interested people but low in power, employee cannot take
decision, plays important role in the organisation. Employee are the

backbone of the company, Uber gives employment and offering good pay
to their employee.
Analyse macro environment for determining and inform strategic management decisions
Macro environment plays an important role for the business to complete their task in an
appropriate manner. With the decided task it is easy to analyse the market forces by use of
PESTLE (Doh, McGuire and Ozaki, 2015). This leads management plays in completion of task
with more efficiency as it is assist organisation to complete all work with decided task. In the
present scenario, PESTLE factor leads organisation for managing organisation action as per
goals and objectives of business. Moreover, PESTLE model also lead management to perform
work with business aspect that makes better results for UBER to complete all task with
efficiency.
TASK 2
P2 Analyse the internal environment and capabilities of a given organisation
SWOT ANALYSIS
Swot analysis is a strategic planning tool or technique which is used in assessment of
strength, weakness, opportunities, threat of the organisation. Which evaluate competitive
position of the company in the market. UBER is an American company that provides vehicles for
hire. Its provides cost saving platform that matched car owner to customer going to the same
destination. Swot of UBER is defines as below:
Strength UBER has high brand value recognition as it maintain its image in over 50
countries. It operates in low fixed investment and has easy access in more
cities through its strong and easy communicative network .UBER has adopt
the dynamic pricing strategy, policy has proven beneficial for its drivers and
industry. Adaptive nature of UBER has recognition across the globe.
International exposure has allowed it to blend and integrate with the different
nationalist and cultures (Doh, Luthans and Slocum, 2016).
Weaknesses UBER is highly depended upon the manpower and internet along with this

Behaviour of drivers is unpredictable and has damage the image of the
company. It has also negative converge in multiple scandals and controversies
which effect the brand image as well as proficiency of the business. Along
with the revenue UBER has also faced sustainable losses because of its
competitors who are implementing more efficient strategies.
Opportunities Customers are no longer impressed by the unorganized cab services this
present profitable opportunity for UBER. It can improve its productivity by
offering services based on accountability and performance. UBER has
potential to proceed into a driverless technology and other special
transportation like ambulance that makes it different from other taxi
businesses.
Threat UBER can face threats from the competitors like OLA taxi, local taxi, public
transportation etc. as they are offering similar type of services to the
customers. Pandemic situation of COVID-19 can resist the growth and
profitability of the business as customers are preferred their own vehicles
rather than other transportation services.
Evaluation of internal environment to assess strength and weakness of an organisation
There are different task performed by management of UBER and most of them are
focused towards implement of techniques that leads to manage and complete task with
organisation goodwill. UBER treat employee's as an asset so it aids staff to perform their work as
per standard services (Fernandes, 2017). Further, competition also exists in transport industry at
high level due to which this is complex for management to work and engage effective
stakeholders. Also the cost for operating business is more which results that driver face
challenges to earn better amount of money.
TASK 3
P3 Porter's five force model to evaluate competitive forces of market
Porter's five force model is a framework to understand the competitive forces for
completion of work in industry. These also drive economic value which is divided among
industry to complete all task with more efficiency. The main role of Porter' five force is to

complete all task according to decided framework and strategy that leads to complete all task as
per industry. UBER Porter's five force analytical framework aids to understand and analyse all
individual forces that shape an overall extent of competition among industry. In the present
scenario, UBER is operating their business within transport industry that is used to operate
business among more than 600 cities with the strength of thousand employees’ around the globe.
The headquarter of UBER organisation is established in the United States from where
organisation manage business at worldwide level (Hamilton and Webster, 2018). They deal in
developing, operating and marketing car transportation services that aids individual to easily
move from one place to another. Porter's analysis of UBER is discussed as below:
 Industry Rivalry- UBER performs their functions in different countries that determine
respective organisation face competition at worldwide level. Therefore, the power of
industry rivalry is high in market. Within most of the market of UBER including
developed countries such as Europe and United States face competition from other
transport service provider like Lyft, they operate business in same market with a similar
business model. So it reduce market share of UBER that minimise the sale of services
which is a complex factor to retain profits for firm. OLA, Curb etc. are some other
competitive firms which also generate challenge and minimise UBER market share.
Technology and appropriate strategy are the methods to retain in market for a longer
period by completing all tasks in effective manner (Hsieh and Wu, 2019). So it is
essential for UBER to operate business to formulate strategy that aids to compete with
customer service, price, comfort and reliability factors.
 Threat of new entrants- Business model of UBER is based on technology and from
perspective of international market. Most of the individuals are familiar with digital,
online and technology based bookings due to which the threat of entering a new player in
market is high. Person requires less effort and a few cost aspects to build similar business
model. It also state that if any well-based financial capital organisation make efforts than
it is easy to operate business in organisation. In the present scenario, there are various
task performed by management and it leads to get register for UBER with flexible hours.
If an organisation want to enter in the industry than it is essential for management of
UBER to attract more number of customers by use of innovation techniques.

 Threat of substitutes- There are large number of substitutes for UBER business exists
and it is used by management to gain direct competition. This is essential for organisation
that makes business model more effective and it is used by management to deal with
individuals with price and same convenience of customers. On the other side, transport
companies provide convenient transport system to its staff and public transport also work
as a similar transport company (Johnston and Glenny, 2020). So it is essential for UBER
to manage and complete all task that add more value as compare to substitute products in
order to attract more number of customer's.
 Bargaining power of supplier- Since UBER not operate vehicles in its name that is
depend on the supplier as all most of the business is depend on the driver and number of
cars. So free hand is provided by UBER to the driver as it is used to complete all task by
supplier power. Therefore, supplier from the perspective of UBER is more important
which leads to complete task in an organised manner. Supplier are based on outsource
that is used for completing work as per UBER brand's name and image. Thus, suppplier
are in power but also authorise to complete work properly.
 Bargaining power of buyer- The power of Buyer is high among all industry because all
organisations are motivated to complete task according to decided strategy. Moreover,
buyer of any business is not permanent unless UBER obtain monopoly position in
market. But in context of UBER buyer position is flexible because large number of
option to switch and buy services from other exist (Kochhar, 2018). These results it is
essential for UBER to complete work according to decided effective strategy because this
helps in completing work with more number of customer's. Moreover, UBER and other
services impact on the price factor of business.
Porter's five force models generate better services by using decided strategy and this leads to
complete work in decided strategy. There are different task performed and it is used to select
industry for managing task in appropriate manner. By understand of all Porter's five forces it is
easy to formulate strategy that leads to select and complete work with effective strategy in order
to develop competitive-edge in market. It is concluded that as by analysing Porter’s force the
ability of Uber to develop various strategies under which long term success and growth is
measured in systematic manner. In this it is acknowledged that Uber having worldwide image
and value under which its capability to attract more customers is increases along with this its

strategy to provide low cost services also provide easy advantage for business. For this
productivity of business also get enhanced as its market reach and customer attractiveness both
get developed in constrained manner by which it is easy for company to maintain long term
stability and sustainability.
Appropriate strategy to improve market position and competitive-edge
UBER enter in the market with disruptive innovation, one of the examples that crop and
offer UBER to lead industry and obtain better position is through transform the business.
Business strategy plays an important role which is used to complete work according to new
strategy specifically for Taxi- cab riding services to avail more number of customer's. There are
different task performed by management and it is used for completing work with decided
strategy. Early adopter advocacy and review are two aspects that are implemented by
management to complete work with use of cost-differentiation strategy. Thus, business leads to
complete all work as per decided strategy. In the context, of UBER Porter's five force model is
also implemented by management that is used to complete work with decided position in market.
TASK 4
P4 Implement the range of theories, concepts and model to devise strategic planning of
organisation
Porter's generic strategies- In the present scenario, Michel Porter provide strategic
model that guide the senior manager for exploration of business opportunities. This helps to
minimise the threats that create barrier and diverse UBER to complete task in proper manner. It
also leads to manage task for managing work in efficiency manner. In context of UBER
technology some of the strategies which provide competition to organisable are mention as
follow:
 Cost leadership strategy- This strategy is beneficial and suitable for the organisation
that is focused to become the lowest manufacture or procedure among industry. It is
related with the lower price that makes decrease in price of products and services (Malin
and Chandler, 2017). This is also used to work with simple strategy in order to minimise
risk related with price factor.
 Differentiation strategy- The term differentiation strategy is considered as a relevant
tool that is used to increase in brand image as well as profits of business. Differentiation

strategy aids UBER in formulation of specific products and services that are different
from other organisation. UBER use differentiation strategy to enhance profits for
business.
 Focus strategy- The final stage to mention which is based on method of focusing the
element to work with focus strategy. It leads to manage task according to differentiation
and cost-leadership for minimising the problems of business.
In context of UBER, there are different task performed by management and most of them is
focused to add value and increase in the number of customer's and profits for business.
Moreover, organisation faces high competition from rival so differentiation strategy is
appropriate for business. In this Uber make respective usage of cost leadership strategy under
which they have offered its services under lower cost by which more of customers get attracted
towards their services that make easy for business to manage its working efficiency and
productiveness. In this higher competitive advantage is gained by business as with having
effectual control on its working operations by which scope, experience and efficiency of business
get enlarged.
Ansoff's Matrix- This is explicated as one of the successful model which is used to
decide better and effective strategy to match with demand of market. From perspective of UBER
aspects of Ansoff's matrix is mention as follow:
 Market penetration- The method of market penetration is suitable for organisation in
different situations specifically towards those when position of organisation is reduced
because low promotion of activities (Rugman and Verbeke, 2017). It is used in managing
successful business for sell of existing products and services in same market.
 Diversification- It is another strategy which is based on the development of new
products as well as services. This leads management to enter into new industry and
market for enhancing their business size. It is also beneficial for UBER because goodwill
of UBER is increased by performing business into different geographical areas.
 Market development- This is defined as a strategic option for organisation that is related
with situation of existing product and services. There are various task performed and it is
used to cover more market area by enhancing in sales of business at different areas. For
UBER market development is a costly process due to its presence in global market.

 Product development- It is the final and last strategy that relates with Ansoff's model
and it relates with product development and services to gain high market share within
existing market (Bayo-Moriones, Galdon-Sanchez and Martinez-de-Morentin, 2020).
UBER use product development strategy for increase in customer base and profits from
local market. This also leads in developing the market for business to complete task with
expensive approach.
This is also observed by UBER that management focus for product development strategy as
per system of Ansoff's matrix. The main perspective of business is to enhance product portfolio
and customer base for organisation. In support of product development ability of Uber to make
repetitive innovation and creation is developed so that ability to attract more customers is
increases. In this technological advancement also get increases so that working efficiency and its
effectiveness both get enhanced over a continuous period of time.
Bowman's strategic clock
It is a clock that is used by business as in order to develop various strategies through
which capability of business to take higher competitive advantage in terms of aggressive
competition is increases. It furthermore consists of various factors that is as explained below as:
 Low price and low value added: In this strategy company imply various strategy in
order to make its services and it is as by offering service at minimum cost. In this ability
to gain higher profit is increases in moderate manner.
 Low price: In this business provide various services to its potential customer’s at lower
cost by which business become cost leader within the competitive marketplace.
 Hybrid: It basically consists of both low price and differentiation by which working
effectiveness is increases.
 Differentiation: It reflect an ability of business to introduce better innovation and
creation in order to develop higher sales and more profit.
 Focused differentiation: In this business maintain clear focus and concern about to
enhance quality services by which business operation and function is processed at global
level.
 Risky high margins: It is a strategy in which business maintain sustained control to gain
higher margin as by managing risk rate in appropriate manner.

 Monopoly pricing: In this business maintain sustained control over price variation as in
order to maintain its sales and profit credibility.
 Loss of market shares: In this aspect business faced loss in market share and value that
has negative impact over stability.
In this Uber make ensure that adequate amount of innovation and creation is involved by
which they are able to connect with more customers as by offering advanced services over
regular period of time. In this effectual growth is achieved that enhanced market value as well
share systematically.
Strategic management plan- It is a plan that work as the framework that is designed for
completion of project according to decided guidelines. This is also known as the project actions
that are implemented to complete task as per project.
Vision
UBER Technology work according with innovation aspect and the vision statement of
organisation is “To bring transportation for everyone at everywhere”. It also reflect main
function of organisation which is to become best in transportation services.
Mission
This defines work, functioning and completion of task with mission statement. It leads
organisation to complete task as per smarter, reliable and convenience services that make
awareness among individual with user or buyer.
Value
UBER value is to engage and take care about efforts, time and affordability for customers
that order and serve person to complete task with effective manner. This also offers quick and
cheaper transportation for delivering products.
Strategic priorities
In context of UBER strategic proprieties related with business is to deliver hygiene
products for protecting individuals from pandemic conditions.
Finance
To accomplish the mission of organisation UBER is focused to obtain 40% funds from
the external sources. This includes bank loan, crowd funding and shareholders for managing
work with decided capital.

Buyers
The target customer's of UBER is to include general individuals, professional and tourist
in order to solve issue related with travelling from one place to another.
Monitoring and controlling
From the perspective of UBER organisation develop and direct the estimated plan in
order to match actual project results with expectation of customer. Further, to control work of
UBER KPI and Benchmarking are the techniques utilise by management for completion of work
with minimum cost.
CONCLUSION
With the analysis of above report it is concluded by management that there are different
forces exists in market that impacts on the performance of organisation. Different model and
theories are used to understand micro and macro environment of business with motive of
enhancing opportunities and growth of organisation. Moreover, various competitive forces exist
in management that leads to complete work for in an appropriate manner. In the last,
management plan is also developed which enable organisation to complete task in successful
manner.

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