Strategic Management Plan: Evaluating Uber's Business Strategy

This report presents a strategic management plan for Uber, encompassing a thorough analysis of its internal and external environments. The report begins with an introduction to business strategy, followed by an examination of the macro environment using PESTLE analysis and a SWOT analysis to assess Uber's strengths, weaknesses, opportunities, and threats. Task 2 delves into the internal environment, evaluating Uber's capabilities, including strategic and resource-based strategies, and the application of the VRIO framework. The report continues with an analysis using Porter's Five Forces model, followed by the interpretation and development of strategic planning. The conclusion summarizes the key findings and recommendations, and references are provided. The report provides a comprehensive overview of Uber's strategic position and potential pathways for future success.

Strategic Management Plan

Table of Contents
Introduction......................................................................................................................................3
Task 1...............................................................................................................................................3
Impact and influence of macro environment...............................................................................3
Evaluation of macro environmental factors.................................................................................4
Task 2...............................................................................................................................................6
Evaluation of internal environment of a business along with its capabilities.............................6
Task 3...............................................................................................................................................8
Porters five forces model.............................................................................................................8
Task 4...............................................................................................................................................9
Interpret and devise strategic planning........................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

·Introduction
Business strategy refers to a proper plan and framework which is designed by managers
of a business in order to successfully achieve all the objectives of a business organisation. It
creates a step-by-step guide which is followed by various employees in the organisation in order
to fulfil their objectives (Mallon, 2019). It is necessary to manage the business strategy and take
decisions in order to successfully achieve all the aims. The following report is based upon over.
What is dealing in car rental services along with food delivery services from 2009. The report
discusses various internal and external analysis along with different business tools which are
applied in order to understand the business strategy for the organisation.
·Task 1
·Impact and influence of macro environment
Mission: The mission of Uber is to provide standard services to their consumers.
Vision: Uber is focusing upon providing their consumer with the transportation system that is
better than any of their competitor.
Objectives: The major objective of Uber is to diversify into different industries and also expand
its business to a number of developing economies in order to enhance their profitability.
Swot analysis:
Swot analysis is a model that consists of various internal factors that are affecting
business. Below mentioned is a swot analysis conducted upon Uber:
Strengths: Uber is one of the largest sharing technological organisations which have more than
40 million active users monthly in 760 cities. The dynamic pricing which Uber is providing to
its customer is continuously increasing its demand along with proper prices. It is a great strength
for organisation as the revenues of the organisation are increasing along with bringing benefits to
all the suppliers such as drivers who are working for the organisation.

Weaknesses: It is often seen that the negative image of Uber due to some of its scandals which
have taken place in past Time is resulting in organisation losing its goodwill (Bryson and
Edwards, 2017). Also there are a number of cases of sexual harassment and target attacks on the
customers of Uber by the drivers which are a great weakness for the organisation (Kachaner,
King and Stewart, 2016). The huge dependence which the Uber have on its workforce is also a
weakness for the organisation as the organisation cannot take decision on their own due to
various strikes that are taking place from time to time.
Opportunities: Increase in the accountability and performance of organisation is a great
opportunity as they can successfully develop various software in order to track the record and
performance of their drivers. Through this they can successfully identify accountability of
different employs. Also improvement in technology can positively help Uber in order to make
sure that they are using various trends in the market to bring benefit for the organisation.
Driverless car is one of such trend which can help Uber to develop and earn more profits.
Threats: Competition in the market for Uber is increasing day by day which is one of the
greatest threats that company can face. Specially in Asian market the organisation have a number
of different competitors. Also the employee turnover rate in the organisation is very high. This is
leading to high cost invested in training and development of employs along with recruitment
cost. It is impacting the operational cost of the organisation and is a threat for the organisation as
well.
l壱Evaluation of macro environmental factors
Macro environmental scanning refers to a system which is used by organisations to
understand various external factors that are having an influence upon the performance of the
organisation. When taking Uber into context there are a number of factors which can affect the
organisational functions positively as well as negatively. Pestle analysis is performed in order to
understand all these factors which can affect functioning of a business. Below mentioned is a
pestle analysis conducted on Uber:
Political factors: Political factors include all those factors which are affecting a business due to
changes in government or political party is taking place in an economy. There are a number of
new rules and regulations brought in the market every time the government changes. This makes

it as and shall for Uber to make sure that they are changing the strategies of business along with
the changing rules and regulations (Soulard and McGehee, 2018). It is necessary for the
organisation to follow all the global and governmental norms and rules so that they can
successfully continue their business activities in different economies.
Economic factors: Economic factors include all those factors which are affecting the earning of
an organisation. The economic factors affecting businesses can be gross domestic product of a
country, interest rate, foreign exchange rate, taxation policies and so on. It is often seen that due
to changes in taxation policies of a number of countries Uber is facing loss of revenues
continuously. In order to keep up profitability of the business it is necessary for Uber to make
sure that they are tracking all these economic changes in an economy and making sure that they
are bringing in changes in their strategy which can deal with the economic changes as well.
Social factors: Social factors include various believes and demands of society in which the
organisation is working which can enhance the profitability of a business. When taking Uber
into context there are a number of changes in preference and demand of customer due to which
the organisation is facing losses. The social pattern in the society is necessary to be studied by
the organisation in order to make sure that they are bringing in profitability. Such as using smart
phone applications in order to manage the pick-up time and book the cab is a great way where
Uber can work and save a number of customers for it.
Technological factors: There are a number of new technologies that are launched in the market
from day to day. It becomes necessary for Uber to make sure that they are continuously bringing
in technological changes in their business in order to make sure that the work of consumers is
convenient enough. Developing various system of new technology can help Uber to attain more
customers and fulfil the requirements of the customers successfully.
Environmental factors: Environmental factors refer to all those factors which are related to
nature and the surrounding in which a business is running (Feng, Govindan and Li, 2017). When
taking Uber into context they can use bio fuels and also implement use of electric cars in order
to make sure that they are not damaging the environment. It can also successfully help to
enhance the reputation of the organisation in the market as they can develop themselves as an
eco-friendly organisation which will also help in sustainable development of the organisation.

Legal factors: Legal factors refer to various laws through which an organisation has to abide by
while they are running their business. There are a number of legal factors such as labour law,
basic pay law and soon which are to be fulfilled by Uber in order to make sure that they do not
face any negative consequences. Organisation not fulfilling the legal requirement can face
lawsuits against them.
External environmental components are those which cannot be changes and significantly
controlled but also tends to impact the business strategies which should be changes in terms of
gaining maximum benefits of probable factors to gain significant competitive advantage in
market that can be achieved. It is essential for Bentley Motors to change its probable business
strategies to adjust within the dynamic environmental condition which is helpful in achieving
sustainability for the longer period of time in market area.
l壱M1 Critically analyse the macro environment to determine and inform strategic management
decisions.
` It is critically analysed that it is important for an organisation to determine the impact of
macro environment factors on the business performance and operations as it help in developing
strategies for dealing with the future circumstances. In addition to this, with the help of SWOT
analysis and PESTLE analysis an organisation is able to determine its strength and weaknesses
along with the opportunities it have in order to attain competitive advantage at marketplace.
Moreover, it is determined that Uber is facing legal issues due to which its brand image is
decline as is considered as weakness for the company. Furthermore, it offers services at
reasonable price that help in attracting large number of customers and is one of the major
strength of the company. PESTLE analysis assist company to develop effective strategies in
order to deal with external issues in a proper manner. SWOT analysis help in gaining insight
about the strength and weaknesses which in turn leads to development of strategic decisions in
order to overcome with the weaknesses in an effective manner.

·Task 2
·Evaluation of internal environment of a business along with its capabilities
Internal factors of a business is playing and essential role in order to make sure that form
is correctly identifying all the capacities they have and what are the various ways which are
required by organisation to maintain all the resources. There are a number of different external
and internal factors that are impacting profitability and productivity of a business. The
productivity and profitability of business are however directly influenced by internal factors and
it is necessary by the organisation to plan various activities in a way that the gaps between
opportunities and success can be filled. Uber is an organisation which has its activities going on
globally and it is necessary for them to make sure that they are using various system in order to
effectively use strategies and enhance various trends of the business using its resources.
Capabilities of the business are mentioned below:
Strategic capabilities: Strategic capabilities of an organisation are the various capacities which
businesses are using in order to perform and provide competitive rivalry to different competition
present in the similar industry. It also helps organisation to eliminate competition and achieve all
the business objectives. When taking Uber into context it is often seen that the strong system
through which the organisation is running is necessarily using all the resources of the
organisation and managing the functions strongly within the business. The company is
increasing its credibility along with the credibility of the drivers and managing the success by
providing them proper training and development opportunities (Harrison, 2016). These are the
ways in which organisation is successfully using all its capabilities in order to make sure that
they can use the internal resources and stand out in the competition in market.
Resource-based strategy: Resource-based strategies are all the strategies that an organisation is
using making the best use of all the available resources to them. The following strategies are
basically dependent upon the managerial framework that a firm is operating under. The strategy
is successfully helping organisation to utilise the resources and enhance their profitability. Uber
is using strategies of following type in order to make sure that all the operations in the business
can be run smoothly facing competition in the market successfully.
VRIO framework

With the help of the above table it can be analysed that there are four important resources
for Uber. Customer loyalty, innovation, service quality and financial position are these resources
for the organisation. It is often seen that innovation can only bring benefits for the organisation
for a limited period of time. Due to this it is necessary for organisation to continuously bring in
innovation (Raikov, 2017). Customer loyalty is a great benefit for the organisation but it is
necessary for organisation to continuously judge the benefits that are to be given to the
consumers. The service quality is one of the major competitive advantages for the organisation
which helps it to deal with competition in the market. The last resource which is financial
position is subsequently helping the organisation to sustainably develop and make sure that they
are having enough capital to bring in innovation and manage all the other resources successfully.
Benchmarking
Benchmarking refers to a framework which organisation uses in order to develop
competitive advantage in marketplace. There are four types of competitive advantage which can
be generated by an organisation that are performance, internal, external and practice. When
taking Uber into context technological factors are continuously enabling the business to develop
various performance benchmarks which are practised and applied in the business. There are also
different technological changes that are improving internal benchmarking system in the
organisation along with improving the performance and internal departments. When taking

external benchmarking into context the organisation is continuously identifying its computer
system and making sure that they can bring in better strategies in order to minimise the
competition that organisation faces within a market place.
l壱M2 Critically evaluate the internal environment to assess strengths and weaknesses of an
organisation’s internal capabilities, structure and skill set.
For effective execution of activities of the organisation, it's management has to do proper
study of firm's internal as well as external environment. It helps in improving productivity of the
workforce and enables to extract best of employees abilities towards completion of companies
objectives. With regards to chosen organisation i.e. UBER, it's management highly focuses on
analysing it's internal as well as external environment, considering the fact internal environment
of the firm should be stable enough to conduct respective operational activities of the firm. It
uses VRIO for evaluating internal environment of the business firm. As the company delivers
common services which is easily available in given marketplace, it faces huge threat of
competitors while conducting it's business activities. It has been analysed that by adoption of
VRIO framework it proves to be helpful in planning structure of the business firm and helps
management of work structure to effectively fight with their competitors. By effective usage of
VRIO firm is able to maintain it's good reputation of it's quality services in the market and assist
firm to increases brand loyalty of companies customers towards their services.
·Task 3
·Porters five forces model
Porters five forces model consist of five different forces which are affecting the
competitive factors in a business. Below mentioned are these five different forces which are
affecting Uber and its competition in the market:
Competitive rivalry: It is one of the major factors in porters five forces model which can be
related to competitive rivalry between different organisations in the market. When taking Uber
into context there are no major rivalry within organisation in the same industry (Schiffer and
Walther, 2018). It is clear that the pricing strategy that is used by Uber is successfully

maintaining its position in the market and most of the competition in the market are not valuable
or bringing any losses for the company.
Threats of new entrants: It is often seen that when new companies are entering in the market the
already existing companies face losses due to losing their consumers. When taking Uber into
context there are a number of market in which Uber is successfully trading. Due to great hold on
the market and huge customer base already present for Uber it becomes difficult for new entrants
to enter within the market. Also there is huge investment required in order to successfully set up
themselves in the industry due to which the threat that Uber has from new entrants is lowered.
Bargaining power of suppliers: It is often seen that a number of companies are supported by the
suppliers who are providing various raw materials and inputs in the organisation. When the
relationship with suppliers is not good the company has to face the effects in a negative way.
When taking Uber into context it is seen that the organisation is highly dependent upon its
drivers and all the suppliers. Due to this the bargaining power of suppliers is increasing and
when the bargaining power in supplier increases the organisation faces losses. It is necessary for
Uber to develop strategies in order to reduce the bargaining power of suppliers by looking for
new suppliers and creating options while selecting suppliers.
Bargaining power of buyers: When considering the buying customers and the bargaining power
present with these customers organisation have to face negative consequences as the consumer
can easily switch to another service. However Uber is providing world-class service and it is
necessary to maintain its operation in order to make sure that they can reduce the bargaining
power of their customers. The bargaining power present with the customers of Uber is very low
as there is no other transportation service which causes as less cost as Uber. Therefore the prices
and policies along with quality services of Uber are reducing the bargaining power of buyers for
the company and bringing benefits for the organisation.
Threat of substitute: there are a number of similar services in the market which are fulfilling the
needs and demands of the consumers of Uber. There is highly competitive market as local
transporters are available as substitute for Uber (Bryson, 2018). Due to this the threat from
substitute for Uber is increasing. It is necessary for Uber to make sure that the services that they

are providing to their customers our quality and at best prices so that the organisation can easily
face the threat they are facing now from various substitutes available to their consumers.
With the help of the above discussion it can be concluded that there are a number of
different threats that competition in the market is causing to Uber. Uber is required to analyse all
these threats and take decisions from time to time which will help them to deal with all these
threats and competition in the market.
l壱M3 Devise appropriate strategies to improve competitive edge and market position based on
the outcomes.
In context to enhance the market position and to attain competitive advantage, it is
significant for the company to analyse the competitors strtaegy that is prevailing at market
presence. It is analysed that the company has high threat to rivals and for this it is significant for
higher authorities of Uber to provide unique and effective services at reasonable price as it will
help in attracting large number of people and also assist in retaining them for longer time period.
With the help of Porter's five force framewotk, Uber is able to anlayse the level of competition
prevailing at marketplace. Moreover, it is determine that company is required to focus on
maintaining relationship with customers as it will help in developing brand image at marketplace
in an appropriate manner. The company is required to focus on analysing thr threats as it will
help in development of effective strategies that leads to raise in productivity and profitability of
an organisation.
·Task 4
·Interpret and devise strategic planning
Porter’s generic strategy
Porter’s generic strategy is a framework which is helping organisations to provide a
competitive edge in the market. There are four different strategies mentioned in the following
framework which can help an organisation to achieve all their goals and objective as mentioned
below:

Cost leadership: Cost leadership is an effective strategy with the help of which Uber can
successfully reduce their cost when taking their competition in the market into context. It will
help the organisation to gain the customers from their competition and increase their customer
base.
Differentiation strategy: Differentiation strategy is a discussion and differentiation of products
and services of organisation from the competition (Soni, 2020). Uber can successfully use this
strategy in order to make sure that the services they are providing to their customers are different
from that of their competitors and the customer or becoming loyal towards the company.
Cost focus strategy: In order to successfully use cost focus strategy the organisation is required
to make sure that they are applying lowering the cost in the niche market. It is necessary that
Uber is specifically changing their cost in order to deal with the competition and various
functions in the business successfully.
Differentiation focus strategy: When an organisation is successfully choosing to focus on
providing differentiation products and services in order to fulfil the requirements of consumer it
is termed as differentiation focus strategy. Using this strategy Uber can subsequently improve all
their functions and make sure that the employs are fulfilling all the different needs of their
consumers.
Diversification: Diversification is a great strategy which can be successfully used by Uber in
order to make sure that they are functioning in more than one market and providing more than
one service to the consumer in order to enhance their loyal consumers and also increase their
customer base. Uber is successfully venturing into new markets and they can use Asian markets
which are developing economies in today’s world. It will successfully helped the organisation to
manage all their objectives and aims along with providing competition in the market in order to
attain maximum customer satisfaction.
l壱M4 Produce a strategic management plan that has tangible and tactical strategic priorities and
objectives.
Strategic management plan is basically a document that is used in order to communicate
to all the staff members about company's objective, configure resources, focus energy and