Strategic Management Report: Uber's Business Environment and Strategy

This report provides a comprehensive analysis of Uber's strategic management, focusing on its business environment and key success factors. It begins with an introduction to strategic management and its importance, followed by an overview of Uber's business environment, including an examination of its key success factors. The report utilizes PESTLE and Porter's Five Forces models to analyze the external and internal factors affecting Uber, such as political, economic, social, technological, environmental, and legal factors, as well as the threats of new entrants, substitutes, buyer and supplier power, and industry rivalry. The analysis delves into the challenges faced by Uber in the service industry. The report concludes with an appraisal of the organization's strategy and a strategic proposal, offering insights into Uber's potential future directions. The report aims to provide a detailed understanding of Uber's strategic position and the factors influencing its success.

Strategic
Management

Executive Summary
Strategic management is the essential part of the organisation that undertake the essential
activities to enhance the company value and productivity level. Moreover, it brings new
opportunity and growth in terms of making good outcomes and productive level of growth.
Present study will be summarizing the overall importance of strategic management on the case
study of Uber. It explains the factors challenges faced by the company during promotions.
Overall, study also consider and taking care of good things and better resources.

Table of Contents
INTRODUCTION ..........................................................................................................................1
UBER's Business Environment.......................................................................................................1
Key success factor..................................................................................................................1
Success factors .......................................................................................................................1
Factors Affecting UBER .......................................................................................................2
Appraisal of the organisation strategy.............................................................................................5
Business canvas model ..........................................................................................................5
Value chain model analysis....................................................................................................7
Resources and Capabilities.....................................................................................................7
Strategic proposal.............................................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES .............................................................................................................................10

INTRODUCTION
Strategic management is the most crucial and effective process, it is the formulation and
implementation of the major goals and initiatives taken by the company. The main purpose of the
strategic management is to make the effective business plan in order to grab the customer
attraction and with compete with other rival companies. Present report will base on strategic
management of Uber company. It is the most impressive and high earn start-up in the world
among other companies such flip kart, Pinterest, Dropbox etc. this report will discuss about the
Uber business environment in order to determine the best possible action. Further apart it also
will explain about the appraisal of the organisation strategy through which they grab the market
attention. Besides, it will also discuss about the issues and development of strategic proposal of
the company.
UBER's Business Environment
Key success factor
Success factors
Business environment is the environment which is dynamic and unstable in the business
scenario (Aihara and et.al., 2017). It includes external or internal environment of business
organisation such as political, legal, social, environmental, ecological, technological etc. these
are the external environment which affect business environment. Along with that, internal
environment is the another environment which affects business functions and growth such as
customers, employees, suppliers, government, shareholders etc. these are the internal
environment which impact on the business activities. Business organisation adopts models in
order to determine the negative and positive impacts. For analysing the external environment
company adopts PESTLE analysis. Besides, in order to analyse internal environment company
adopts Porters Five forces model. Uber is the Cab providing company through which they
provide different services to customers like high deep seated cars with luxurious cooling services
along with Wi-Fi services (Augusto, and Souza, 2017). Besides, there are some competitors and
economic environment affect the business services or growth, to determine all those
environmental issues in service industry needs to analyse external environment.
Uber is the well knowing taxi company that has been providing new plan and strategies.
This gives new way of learning and presenting good goals and set the strategic criteria in front of
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their competitors. Present study will be presenting the overall depth of the case study of Uber.
This also provides the opportunity to get over from the threats and constraints of Uber.
Factors Affecting Service Industry.
PESTLE analysis
Political (P): Uber is the car servicing company which provides services to the customers
as per their needs and wants (Uber PESTLE Analysis, 2017). During the period service industry
facing the controversy during its initial periods without having clear regulations. During the ride
in case of any damage and accident they are not liable to pay compensation or not nay kinds of
insurance services. Moreover, they faced many public issues and questions. Some more issues
related to not having licence in order to which they bane on the services. Political issues are the
same issues which influence by governmental policies, changes in rates, demographic changes
etc. in order to face the challenges service industry facing lawsuit and the California authorities
ruled. In order to that company also facing the issues in south Africa related to the licensing, this
issues gives high impact on the service industry operations due to which they facing the huge
customer loss.
Economic (E): Uber company also affected by the economic factors. Sharing economy is
the great impact on the economy growth in order to increase employment growth (Uber PESTLE
Analysis, 2017). It is the effecting process. In terms of service industry they provide different
types of employment services for every large number of drivers. This impact positively in terms
of searching for taxis. In order to get the customer attraction and customer focus company
reduce their prices in order to compete with other companies. Economic factors influence the
company positions and policies in terms of changing in interest rates, inflation rates, foreign
exchange rates etc. in order to compete with the rivalry firms this gives the impact on the
business. Economic factors are the most influencing factor that directly impact on customer
demand and supply. Economic factors also influence and change the different rates as result
customer face high prices of services and products.
Social (S): social factors is the highly affected factor in business organisation. This is the
another external factor which is influenced by the people changes needs, market trend, demand
of the customers etc. In order to maintain the respectful image in the market or with the
customers (Uber PESTLE Analysis, 2017). Service industry needs to adopt fair services and
legal environment to get the customer attraction. service industry needs to adopt High safety
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precautions to safe the life of client. It helps to enhance the customer faith and loyalty. It gives
high value to customer services and enhancement of brand value. Social factors influence
company brand image and market share in among other competitors.
Technological factors: it is the another factor which impact on the company function.
Technological factors are the root of everything according to remove the addition la time cost.
This is the another factor which impact on the business services. Without having the presence of
effective technologies' nothing is impossible (Dиdnуk and et.al., 2016). Service industry has
introduced high class technology for customers as well as business which express the growth of
economy. They introduce high prime app services through which customer or driver can easily
connect with each other and grab their ride. Beside, they also adopt technology which reduce the
waiting period of the customer and drivers. Overall, changes affect the service industry and their
priority customers. Overall, it gives new ways of working as well. Overall, technological factors
are influence changing behaviour of industry and target market goals. Overall, it brings new
effective technologies and growth in order to take the opportunity growth. In terms of security
context, It involves threats and uncertainty and risk.
Environmental (E): It is the another environmental factors which affects the
organisation growth. This factor influenced by the environmental growth. Like Uber facing the
issues of about the ride sharing services of the company. In order to stable the environmental
issues company adopts Pilot projects called service industry Green where the rides can request a
green ride at the tap of a button. Through which they get good and effective response (Elert and
Henrekson, 2017).
Legal (L): legal is the another affecting factor which gives adverse impact on the major
factors. Legal factors influence by the government legislations or terms and policies. It is the
most challenging and effecting process in order to maintain the process (Uber PESTLE Analysis,
2017). On the other side, service industry facing the issues related human resource related to the
wrong behaviour of buyers with the customers or not follows the rules of the government.
From the analysis of above given factors. Service industry requires to taking
technological better growth making task. Technological and social factors can providing the best
success and fast growing performance. This helps service industry to take new changes and new
development process. Major opportunity and growth will make new process which makes new
growth and challenge.
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Porter's five forces model:
It is the model in order to take the internal analysis and growth opportunities. This model
of internal analysis the internal threat and opportunities. This model is very helpful in order to
get the best effective strategies.
Threat of potential new entrants: Service industry is highly affected by the new
competitors. The focus of the company is on the effective environment which gives the high
potential level to the company. On the other sides, another aim of the company is to fill the gap
between customers and employees. In order to that, Service industry has facing high impact if in
case new entrants adopt low penetration price strategies to getting good attraction of the
customers. This is the threat of the company which affects in some future times (Ibrahim, Dumas
and McGuire, 2015). On the other side, in order to stable in the market company needs to adopt
strategic policies and business plans in order to retain the attraction level of the customers.
Threat of alternatives or substitute services: it is the another threat for the Service
industry may arise trouble for the companies. Substitute is the most common fear for the existing
companies. There are various substitutes for the customer in transportation industry. It is the
higher complex and tough task to stop the development technologies and new ideas. Due to other
public transport offers may threaten for the company growth (Porter's five forces analysis on
Uber, 2017). It is the best opportunity for the company to adopt the best market share in order to
reduce the external issues and challenges (Mueller and Naffziger, 2015). In order to retain the
existing customers company need to grab effective development and adopts new pricing policies
to maintain the customer retention. Along with that, as per the current situation this factor is
weak in this scenario. Substitute services or products likely affect the industry or a particular
company. That might giving less opportunity and growth to given negative factors. It happens
when number of threats are high and influencing.
Supplier Bargaining power: This is the ability of suppliers to drive the prices of the
company. The leading supplier of this industry is availability of drivers. On the other side, it is
the another great opportunity for the company. service industry adopting the car owning drivers.
Uber have the limited supplier they control their business through web technologies. In order to
face the challenging situations. Company contribute some effector in order to grab the attraction
of drivers. service industry gives the free freedom to drivers to choosing between organisation or
rivals. Another supplier of the company is oil and gas suppliers. This is the threat which affects
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company profit level (Ramos, and et.al., 2016). Due to fluctuations of prices of oil and gas
increasing the high risk for the company.
Threat of buyer bargaining power: The customer power may affect the company profit
level margin. On the other side, customer is the major factor or source of income. It is necessary
for the company to adopt the customer oriented pricing or services in order to grab the attraction
of customers towards the services. Service industry clients are sensitive and dynamic. Due to
threat of rival firms or company they may attract towards them as well due to price fluctuations.
This is the threat for the company to maintained the good relation with the customers. Moreover,
buyers power is the high power in order to get the customer attraction and objectives.
Industry rivalry: this is the strength of the company the focus of the concentration
industry arrears the new higher than previous years. In this threat company needs to compete
with both customers and competitor. There are many competitors of service industry who affect
the business operation in the market. It gives different opportunity to adopt in order to beat the
competitors strategies (Salmerón and et.al., 2015). Curb and Digi Chuxing, Lyft is the principle
competitor of Uber. Today's generation are demanding more for new technologies and services.
This approach or enhance the customer focus and attraction towards the company.
Appraisal of the organisation strategy
Business strategies and techniques they adapt to take the customer attraction and
attention. In order to appraisal the business model and strategies, there are two models for
analysing the organization strategies (Son and Kim, 2016). Uber is the kind of ride sharing
company which provides taxi services to the customers. In order to analyse the business canvas
model there are six segments in order to analyse the business strategies and functions.
Business canvas model
Customer segments: Service industry has two group of partners. There have two
passengers that is customer and drivers. This is the another main segment of the company which
require more attention and effectiveness. The biggest difference between traditional cabs and
modern taxi is that, today's taxi require smartphones. Customer does not need to go to the
company and book the cab now things have changes. On the other side, Uber uses freelance
drivers. Uber make the smart appearance of technology.
Value proposition: it is the another segment of the company which express the value of
the company. It provides customer values and their safety manners. The main value of the
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company is that they provide rides when customer wants and for drivers their values are we give
you passengers when you want them (von Rosing, Scheer and von Scheel, 2015). It is the best
value given by the company in order to maintain the flexibility in the working. It is the unique
concept through which customer get attracted.
Customer relationship: company provides the best practices to the customers in order to
grab the customer opportunities and attention. In terms of customer relation company provides
customers various services and approach such as with the helps of location driver can easily tract
the customer location and place. This feature helps to reduce the customer efforts which gives
flexibility to the customers. They help to get the best effective position and give comfort to the
customers.
Channels: Another element is channels. The channel of distribution of the company is
very flexible and time saving such as customer use the app and service of the company by
registered itself on the app (Wagner Mainardes, Ferreira and Raposo, 2014). It cannot restrict
the place or city. This is the another main objective of the company. It is the another very
effective and sufficient channel for the customers.
Revenue: in terms of Service industry revenue is very much effective and based on
unique concept which gives more flexibility to the customer. Its GPS technology on the phones
helps to track the location where customer wants to reach. And then charges according to that
manner. Its revenue is pretty simple and average (Elert and Henrekson, 2017). Basically, Surge
algorithm comes into consider on cab aggregation platform like Service industry and Ola when
customers have to pay a multiple of the usual fares. In this situation fare has automatically
increased when the demand for taxis is higher than the drivers available in a particular
neighbourhood. These kinds of apps show customers that the fare are surging and if you accept
the surge. In that case fare will automatically increase.
Key resources: there are three resources of Uber which they adopt without those
resources Service industry cannot achieve the target goals. Those resources connect customer to
drivers. Like pricing algorithm are used to maintain the supply and demand in the market and
help to meet the demand. It is the another focus of the company through which they meet the
needs of customers. Besides, routing algorithm try to make sure that customer wait time is
always short and limited.
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Key activities: the main key activities of the Uber is to providing the can services at any
place where customer demand. Company always looking to add some more values in order to
meet the needs of customers (Elert and Henrekson, 2017). They having lack of geographical
effects through which they connect customers.
Key Costs : Key costs is the another factor that should be according to the matter of fact.
That shows the matter of fact that shows the better effective services or growth. service industry
business model has been all about transferring capital costs to partner drivers. In terms of
investment Saudi Arabia has invested $3.5bn in Uber.
Value chain model analysis
It is the another model to analyse the strategies of Uber. This model includes five factors
through which company strategies will easily analyse.
According to this business canvas model will help to analysis the business capabilities
and helps to create new values by developing core business. Through creating the integration of
different elements. This helped to analyse the model through visual manner. Overall, it brings
new major opportunity and growth.
Uber Inbound logistics: Inbound logistics means receiving and storing the raw material.
In terms of Uber it is the largest taxi technology company in the world, they doest not own cars
or any vehicle to serve the services to the customers. They all are owned and rented by the Uber
drivers. They provide drivers to carry smart phones in order to connect with the company.
Company inbound logistics relate to the internet based nature of business operation (Brusa and
et.al., 2017). Such as company needs to introduce many new services and attractive customer
offers. Such as taxi on demand, cash free rides, cabs for customers and on demand passengers. It
helps to enhance the value chain.
Uber operation: Service industry works in more than 760 cities worldwide they are
usage they requesting the ride by tapping on the phone screen. Through which driver can easily
approach the customer. Another service of the service industry is ride where customer wants to
go driver will take them on that position. Customer also can easily track the position of the driver
in order to secure the safety reasons. In terms of payment customer can easily pay the amount at
the last arrival.
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Outbound logistics: it is the next value chain element is outbound services. This is the
process of warehousing and distribution of products. Outbound service is not applicable for
services sector (Brusa and et.al., 2017.).
Marketing Sales: the main marketing source of the company is social media source it is
the best process for getting the best effective services or customer feedback. They adopt print
media and advertising tools in order to get the best services.
Service: High level of customer satisfaction is the core advantage for the company, good
customer services is always good motivation of the customers (Augustsson, Holmstrom and
Nilsson, 2015). In order to getting customer feedback customer can easily give feedbacks in
terms by giving rating stars to the services of drivers.
Resources and Capabilities
In order to take resources and capabilities key resources include global presence and
technology under physical resources, skilled workforce and driver advocates under human
resource management. Competency level of service industry has excellent services to provides to
customer. This process will help to take better resource's and growth. Besides, service industry
having strong image and comparative level of performance and growth. Moreover, it brings new
opportunity and growth.
Strategic proposal
RACE is the model that helps company to implement the strategic plan in order to
overcome from the market challenges. This brings new opportunity and growth in order to
introduce new services and growth. That helps to full fill the company probability area.
With the help of RACE model company needs to evaluate company strategic proposal.
RACE model means Research, Analysis, Communication, Evaluation.
Research: it is the first process in order research the market opportunities and issues
through which company lacking behind in the market. Industry needs to adopt this model in
order identify the best business opportunities (Ibrahim, Dumas and McGuire, 2015). Being a
CEO, company needs to adopt creative and innovative technology through which they reduce the
customer safety concern and get good customer feedback.
Action and planning: in this next process of RACE model is to analyse means, company
needs to analyse the model and their pros and effectiveness in order to implement in the
company. Company needs to adopt some techniques and strategies in order to implement the
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whole process. Analysis process may give some more ideas and strategy tools in order to get the
best outputs.
 Specifically
 Measurable
 Attainable
 Realistic
 Time
Communication & Relationship Building it is the another process of the model through
which make best and productive strategic model (Son and Kim, 2016). Communication tool
process helps to communicate information to all company members in order to implement the
process. This helps to take the best possible returns from the customers. Communication process
helps to implement the model or strategic proposal plan into action. On the other hand
communication helps to communicate the plan to end consumers. With the help digital
technologies company can easily connected with the customers. This makes process successful
and effective. Along with that, communication also helps to get the feedback from the customers.
Evaluation: it is the another way to implement the process or model and then evaluate
the model in order to take the response from the customers. Evaluation helps to check the
process weather it is implemented properly or not (von Rosing, Scheer and von Scheel, 2015). It
helps company to make corrective changes as per the needs. Evaluation process helps to make
changes according to the business needs. In order to measure the performance company needs to
measure following points.
 Focus group and interviews
 Media Content analysis
 Secondary data
 Press clippings.
This model of strategic model helps Service industry to make attractive services or
business opportunities. This model helps to grab the business opportunities in order to stable the
market position (von Rosing, Scheer and von Scheel, 2015).
CONCLUSION
From the above section, it can be concluded that, Service industry is the fast growing
company in order to get the best possible outcomes. Present report based on macro and micro
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