Business Strategy Report: Evaluating Uber's Competitive Advantage

This report provides a comprehensive analysis of Uber's business strategy. It begins with an introduction to business strategy and its importance, followed by an examination of Uber's macro environment using the PESTLE framework, assessing political, economic, social, technological, legal, and environmental factors. The report then delves into Uber's internal environment and capabilities, applying the VRIO analysis and the McKinsey 7S model to evaluate its resources, competitive advantages, and organizational structure. Furthermore, it applies Porter's Five Forces model to assess the competitive dynamics within Uber's market sector. Finally, the report explores various concepts, theories, and models used for strategic planning within Uber, culminating in a conclusion summarizing the key findings and strategic implications.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
Task 1...............................................................................................................................................1
P1 Application of appropriate framework for analysing impact and influence of macro
environment ................................................................................................................................1
Task 2...............................................................................................................................................4
P2 Analyse the internal environment and capabilities by using relevant frameworks................4
Mc Kinsey 7s Model - ................................................................................................................5
Task 3...............................................................................................................................................6
P3 Application of Porter's five forces model in evaluating the competitive advantages in given
market sector................................................................................................................................6
Task 4 ..............................................................................................................................................7
P4 Applying range of concepts, theories, and models for strategic planning. ............................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategy is defined as major planning for the organization which uses to operate
the the business continuously and attain the goals as well as objectives. The aim of any industry
is to satisfy their customers and attain the competitive advantages. The strategies are important
for making the right business decision by completing task and activities (Ahenkora and et. al.,
2016). This report is based on Uber Technology that is large size organization, offering vehicles
for hire, food delivery service, packaging, couriers, freight transportation and others. In this,
more than 1000 employees are working collectively that understand the goals and perform their
responsibilities effectively. The report covers impact and influence which the macro environment
has on organization, internal environment and capabilities, application of outcome by using
porter's five force and models, theories that are devised for strategic planning.
Task 1
P1 Application of appropriate framework for analysing impact and influence of macro
environment
Business environment is considering many factors and activities that are related to a
business should be focused properly as it helps to overcome the challenges. To run a business
and managing all functions management should be analysis environment that states how it might
be impacts on organizational performance (Amran and et. al., 2016).
Macro Environment – This means external environment that is the combination of
various factors that are related to business and occurs while running activities. In relation to Uber
Technology that is one of the largest company providing car facilities, that estimated to have
more than 110 million monthly active users worldwide. The organization has captured the 67%
market share for riding sharing and 24 % market share for food delivery. The macro environment
analysis in context to Uber organization is defined below:
PESTLE Analysis- This is a framework for analysing the external environment by
considering various factors that can help to manage the all functions and activities. This is
important for organization to know which factor might be affect the organizational performance.
The analysis for chosen organization is defined below:
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Political factor – Different aspects are considered such as tax rates, political stability,
government legislations, fiscal policies and others that has impacts in case of shifting a small
amount.
Positive impacts – Uber is operating its business at number of locations where it follows
all government regulations and tax rates that can help to increase the organizational performance
effectively (Akter and et. al., 2016).
Negative impacts- As Pandemic (Covid-19) has occurred in whole world where
government has stopped the transportation, food and other services in whole country that became
a big challenge to continue the business.
Economical factor – This consider economic growth, employment rate, interest rates,
inflation, wages, disposable income and others that has impacts on organization (Anwar, Shah
and Hasnu, 2016).
Positive impacts – The economic growth of country where Uber is operating its business
is favourable as it helps to manage the all functions and increase the sales by attracting number
of customers.
Negative impacts- It has seen that due to Covid-19 all businesses are stopped due to
lockdown where people get unemployment that has impacted badly on organisational
performance as well as country's economical condition.
Social factor – The aspects which are involved in social factor are population growth,
age distribution, career attitudes, changing in lifestyle and behaviour of people that are important
to consider while running a business (Baye and Prince, 2016).
Positive impacts – Uber is large organization that understand the needs of their
customers and providing safe ride and food products to their customers that build the confidence
of customers to hire again.
Negative impacts- Sometime, it can be create the problem for customers as they book
ride and does not receive on time that develop the dissatisfaction among people. Moreover, due
to not clear routes it drop the customers at wrong destination that create the problems in running
business.
Technological factor – This involves emerging of technologies, target market
communication, copyright, new innovation and technology that are determined for business.
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Positive impacts – Uber is created a good brand image in technological environment as it
bring the uses of various communication channel and marketing that supports to reach the large
number of customers worldwide. Thus, it has positive impact on organization (Chang, 2016).
Negative impacts- On the other side, due to adopting new technology and marketing
channel. Cost of Uber is increasing that lowers the profitability of organisation.
Legal factor – Different legislation are related to business such as health and safety,
consumer protection, anti discrimination, labour laws and others that has impacts.
Positive impacts – Uber is getting opportunity by using this factor as it follows all
legislations and rules that are formulated by government that supports to run business
continuously (Cusumano, Gawer and Yoffie, 2019).
Negative impacts- In case of not following legislation by Uber, can be affected
negatively as it cannot operate its activities ahead.
Environmental factor – This involves environment safety, changing climate, promoting
positive business ethics, and geographical location.
Positive impacts – Uber is following environmental safety rules and it gets repair its cars
time to time by checking pollution that contributes in organizational performance.
Negative impacts- Due to changing climate and increasing pollution business of Uber
can be stop as per guidelines that has negative impacts (Chen, Eshleman and Soileau, 2017).
Stakeholder analysis – This can be determined as process of assessing a system and
changes that related to parties which are involved in business. In organization number of people
or stakeholders are working that perform their roles and responsibilities.
Stakeholders analysis
LEVEL OF
INTEREST
LEVEL OF
INTEREST
LEVEL OF POWER HIGH LOW
HIGH Management, Owners Government
LOW Staff members Customers
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High power, high interest – This means top executive level that makes the business
decision by analysing all informations. In relation to Uber, management and owners are
considered as top management as they have high power and high interest to decide goals and
formulate the planning which helps to manage the all workings and provide competitive
advantages (González-Rodríguez and et. al. 2018).
High power, low interest – This means people who have high power and low interest as
it brings the new regulations for running a business continuously. In relation to Uber,
government is having lower interest and high power that helps to operate and run the business
regularly in the changing market.
Low power, high interest – The part of stakeholder analysis consider those people who
have lower power and high interest that make efforts to contribute in organizational activities. In
context to Uber, employees are having lower power as they cannot make right business decision
and high interest to get return by doing well.
Low power, low interest – This involves people who belongs to low power and low
interest in organizational working as it helps to manage the business activities and performance.
In relation to Uber, customers are having lower power as they are not able to interfere in
organizational workings and functions (Farrukh and et. al., 2020).
Task 2
P2 Analyse the internal environment and capabilities by using relevant frameworks.
Internal environment is related to activities and functions that are perform within the
organization as it supports to all businesses to bring the changes accordingly. This can help to
maintain good performance. The internal environment analysis in context to Uber is defined
below:
VRIO Analysis: This is a model which uses by organization to analysis the resources
which are available at the workplace and it helps to get the competitive advantages. This defined
as strategic process that begins with vision, mission, and objectives of of organization. The
VRIO analysis in context to Uber is defined below:
Resources Valuable Rare Inimitable Organised
Financial
activities
Yes No No No
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Customer
satisfaction
Yes Yes No No
Drivers and
riders
Yes Yes Yes No
Brand image Yes Yes Yes Yes
Valuable – It means resources and activities which are valuable for organization that can
help to provide the competitive advantages. For a business it is needed to have clear
understanding about resources and abilities that can help to complete the task and attain business
goals. The main resources of Uber are Financial activities, customers satisfaction, Drivers &
riders and brand image. These are valuable as it helps to attracts the number of customers by
providing better quality of products and services. The management formulate the effective plan
and bring the changes that can provide the satisfaction to people (Hart, Sharma and Halme,
2016).
Rare – This means products and services which are rarely available in other company
that make customers loyal towards one brand and increase the performance. In relation to Uber
customer satisfaction is the main resource that are uses to increase the sales. The management
understand what their customers wants and how they could be satisfaction. Thus, kind of food
products and riding services are provided to customers that increase value of organization.
Inimitable – This means resources which are inimitable or cannot be copied by others
that can help to run the business properly. If products and services imitable by another industry
then it could be challenge for existing organization to continue this. In case of Uber, Drivers and
riders who are providing safe riding to customers are inimitable that motivate the people to book
again and share their experience.
Organised – This can be explained as important strategy for organization that are mainly
uses to complete the decided goals and attain the profitability. In relation to Uber, Brand image is
organising by all management and employees as they introduce new products and services by
opening new stores or riding services that develop the organizational productivity.
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Mc Kinsey 7s Model -
This model is uses by organization to examine the effects of future changes by aligning
department and process during merger and acquisition. Uber is following this model that are as
explained:
Strategy: Uber is using the lower pricing strategy as compare to other organization in
similar sector that attracts the large number of customers.
Structure: Uber is following the hierarchical structure in which roles and responsibilities
of employees are delegated as per skills and abilities (Lozano, 2018).
System: The employees and management are following process and procedures by
engaging people in organizational work that helps to attain the business goals.
Shared values: The management and employees who are working in Uber are sharing
information and contributing in society by delivering better quality of products and services. This
supports to increase the business performance and profitability (Nursal, 2019).
Style: This refers leadership team and members who works collectively and complete the
task. In relation to Uber, Participative leadership style is uses by management that can help to
manage all work and activities effectively.
Staff: In selected organization, finance, Human resource, IT, accounts, marketing and
sales people are working in wider range that supports to attain the business goals and objectives.
Skills: The employees and management who are working in organization is having
research, communication, marketing and other skills that are uses to attracts the large number of
customers and increase profitability (Maniora, 2018).
Task 3
P3 Application of Porter's five forces model in evaluating the competitive advantages in given
market sector.
Porter's five force model: This model is related to developing the business in competitive
market by using effective strategy and planning. This mainly uses by management of Uber by
focusing on all forces that are as explained:
Bargaining power of Customers: This means how people can bargain the prices of
products and services. In relation to Uber, bargaining power of customers is lower as it shows the
prices via booking that remain fixed or might be increase. These prices has to pay by customers
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while taking services as they beliefs that company provides safe riding to people that helps to
attain business goals.
Bargaining power of suppliers: Suppliers playing an important role in business as it
understand the needs and wants of different distributor and provide them products and services
as well. In relation to Uber, there is less threat of bargaining power through suppliers because
having number of suppliers in market can be opportunity for selected organization to tie up with
another. Thus, it can be opportunity for industry to increase their sales and profitability (Parry
and Lind, 2016).
Threat of new entrants: This means entrance of new business industry in changing
environment that can affects the organizational sales and profitability. In relation to Uber, there
is high threat of new entrance who can provide riding and food services at large scale. Thus, it
affects the organizational performance and sales negatively (Kong and et. al., 2020).
Threat of substitute products: This means providing similar kind of product and
services which are providing by organization. It directly impacts on business sales and
profitability. In relation to Uber, there is moderate threat of substitution that can be challenging
situation for enterprise to operate and continue their businesses.
Competitive rivalry: This states number and strength of competitors that might be affect
the existing business. In relation to Uber main competitors are Jugnoo, Rapido, Zoocar, Quick
ride, Drivezy and others that creates the competition for organization and might be reduce the
profitability (Misra and Sharma, 2017).
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Task 4
P4 Applying range of concepts, theories, and models for strategic planning.
The aim of business enterprise is to satisfy their customers and develop the growth in
changing environment. Strategy is the main function of business that states what and how the
organizational functions are organising, so that effective outcomes can be obtain by managing all
activities. Uber is using Ansoff's Growth Matrix for he purpose of increasing productivity that
are as explained:
Ansoff Growth Matrix: This can be explained as marketing planning model, uses by
enterprise to determining its products and market growth strategy. By using this, management
can focus on each activity and develop the business performance. This is explained below:
Market Penetration: This matrix is mainly focuses on selling existing products in to
existing market that can help to increase the market share of current products. In relation to Uber,
management can use this, by selling its existing products and riding services in existing market
through reducing prices which can help to attain the business goals and profitability.
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Product development: This strategy is important that uses by organization in
introducing new products in to existing markets. It requires development of new competencies
and modification of existing products that supports to appeal the existing market. In relation to
Uber, management can use this strategy by introducing new services and products in rides and
foods delivery that will help to attracts the large number of customers (Razak and .et. al., 2016).
Market development: This is another strategy in which an organization enter in to new
market by selling its existing products. The strategy involves possible ways such as new
geographical market, product dimensions and others that can helps to operate a business and
increase productivity. In Uber, management uses this strategy to enter in to new market world
wide that helps to increase the organizational sales and profitability.
Diversification: This is growth strategy where organisation introduces new products in
new market for the purpose of increasing business performance and attaining higher profitability.
In relation to Uber, can opt this strategy by introducing new riding and food services that attracts
new and existing customers. This increases the business productivity by managing all functions
and activities.
From the above, Diversification strategy is adopted by Uber in which it introduce new
services and food products in new market. This attracts the high range of people and provide
them higher satisfaction.
Hybrid strategy: This is a strategy uses by business enterprise by looking
simultaneously to attain differentiation and lower price relative to competitors. Uber is large size
organization uses hybrid strategy by stating differentiation of products and services for the
purpose of attaining business goals.
Vertical/ Horizontal integration: In horizontal integration, when a business grows by
acquiring similar organization in their industry at the same point of supply chain. On the other
side, vertical integration is uses in expansion of business by acquiring another company that can
help to operate the business continuously. Uber can use vertical integration by acquiring another
business that helps to grow the productivity and brand image effectively (Wieland, Hartmann
and Vargo, 2017).
Strategic management plan that supports to attain strategic objectives.
Strategic planning is the continuous process that involves document and establishment of
organizational goals that needs to complete timely. This is important for all organization to
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decide the goals and prepare plans that can help to attain the higher profitability. In relation to
Uber, a strategic management plan has been prepared for the purpose of expanding business that
are as explained:
Executive Summary- For completing any task and project, planning is important that is
prepared by management by analysing all resources and capabilities. Uber is largest organization
in technological sector where it introduces variety of products and services that can help to
attracts customers and maintain higher profitability. The organization wants to expand its
business by increasing number of cars for service, and food services at different location over
worldwide (Yuliansyah, Rammal and Rose, 2016).
Vision – The vision of Uber is to smarter transportation with fewer cars and greater
access. The transportation should be safe, cheaper, and reliable that attracts the number of
customers.
Mission – The mission of Uber is to bring transportation for everyone, every where.
Objectives -
 To increase range of products and services all over the world.
 To increase the profitability by 70%.
 To satisfy the customers by offering providing safety rides.
 To manage the good position in competitive market by managing all functions and
activities.
Strategy -
Differentiation strategy – This means to introduce the new products and services as per
customers choice which can help to attracts the large people and increase organizational sales. In
relation to Uber, management uses this strategy for the purpose of introducing new riding
sharing services in less time, that can help to increase the performance in changing environment.
Extensive marketing – This is important strategy which can be uses by organization to
influence the large number of customers. In relation to Uber, management will use social media,
Instagram, Face book and own application to provide the information and discount offers can
increase the organizational sales and performance (Yuan and .et. al., 2020).
Pricing strategy- In this, Uber is using lower pricing strategy in which it introduce its
products and services at lower prices that can help to attracts the all customers to buy services at
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lower cost and share feedback. This helps to increase the brand image and market share
effectively.
STP Approach: The segmentation for the selected business are defined as:
Segmentation: In this, Uber is focusing on demographic such as age, needs of customers
and others that can help to provide the services accordingly.
Targeting: The Uber is targeting between the age of 10 to 60 years old who needs ride to
go somewhere and food services (Zhong and et. al.,2020).
Positioning: By providing all services and products, selected organization is seeking
towards higher position in competitive market that helps to attain the business goals.
Financial information – To bring the new products and services for customer
satisfaction there is need of finance, so a estimated budget is prepared below:
Particulars Amount
Operational activities £10000
Investment activities £ 50000
Financial activities £ 80000
Total £ 140000
Evaluation & Implementation: All activities and functions which are involved in
marketing plan will be evaluated by using KPI and bench marketing tool that would help to
operate the business effectively. By using KPI, financial and non-financial activities would be
analysed and benchmarking will help to formulate effectively planning for completing task as
well as attaining business goals.
CONCLUSION
From the report it can be concluded that business strategy is the planning for any
organization as it understand the goals and formulate effective strategies to attain the
organizational goals. To analysing external environment PESTLE analysis and stakeholder
analysis has been done that helps to know how factors affects business. By using Porter's 5 force
and Mc Kinsey 7's model company can attain the competitive advantages. Moreover, For
developing the business growth, Ansoff Growth matrix can be use that helps to make right
business decision.
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