Strategic Analysis of UBER Technologies: Business Strategy Report

This report provides a comprehensive analysis of UBER Technologies' business strategy. It begins with an introduction to strategic management and its application to UBER. The report then delves into a detailed analysis of the macro environment using the PESTLE framework, examining political, economic, social, technological, legal, and environmental factors impacting UBER's operations. Following this, an internal environment analysis is conducted using the SWOT model to assess UBER's strengths, weaknesses, opportunities, and threats. Furthermore, the report applies Porter's Five Forces model to evaluate the competitive landscape and devise strategies for improving competitive advantages. Finally, the report incorporates various theories, concepts, and models to interpret and devise strategic planning recommendations for UBER, concluding with a summary of the key findings and strategic implications.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
MAINBODY ...................................................................................................................................1
TASK 1 ...........................................................................................................................................1
P1 Apply appropriate framework to analyse macro environment .............................................1
M1) Critically analysis the macro-environment to determine and inform the strategic
management decision :................................................................................................................4
TASK 2............................................................................................................................................5
P2) Analysis the internal environment and capabilities of the UBER :......................................5
M2) Critically evaluate the internal environment to access the strength and weaknesses :........8
TASK 3 ...........................................................................................................................................8
P3) Apply porter five forces model on UBER Technologies:....................................................8
M3) Device appropriate strategy to improve competitive advantages .......................................9
Task 4.............................................................................................................................................10
P4 Apply range of theories, concepts and models interpret and devise strategies planning for
given organisation.....................................................................................................................10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business strategy deals in strategic management which involves with the process of
formulation and implementation of the long term goals and objective which are taken by the
business manager on behalf of their business owners. Having the aspect to meet with the needs
of the customers and other external environment, a cost strategy, a differentiated product and a
service strategies. Business strategy helps in attaining the competitive advantages over there
competitors through serving the best quality and standard products or services to their customers
and the strategy to attract the potential customers (Cubas‐Díaz and Martinez Sedano, 2018). It
involves with the strategy which are develop in the internal phases of the organisation by proper
adaptation of the practises and procedure in throughout the long term goal journey of the
organisation these aspects will be fulfilled by analysing and determining the internal as well as
external environment through proper implementation of the model like SWOT and PESTLE
analysis, these models assist any business to formulate the plan according to the situation
analysis of the market. The below report is based on UBER Technologies which is an American
technology industry having headquarter in San Francisco, California, United states commonly
known as Uber , the services in which this industry works involves food delivery, package
delivery, services relates with couriers and freight transportation. The report consists the topic is
impact and influence of macro environment on organisation and its business strategy, related
theories and concepts to assist the understanding of strategic directions.
MAINBODY
TASK 1
P1 Apply appropriate framework to analyse macro environment
UBER Technologies Inc, which is an American technology industry, there headquarter is
in San Francisco, California , United states. This industry deals in the services like food delivery,
package delivery, couriers related services, freight transportation, this company basically
involves with the subsidiaries Like Uber eats and Corner shops, this industry generates the
growth from there transportation services like motorized scooter rentals, the products of this
industry completely based on the mobile app and websites to meet their customers through
online platform, right now they are operating in 900 metro areas world wide (Hadid, 2019).
Number of employees currently working in this industry is about 27000 employees
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approximately. Here are some of the strategies on the basis of mission , vision, goals an
objectives of the industry is that:
Vision
This industry relates with value of providing smarter transportation with fewer car and
having with greater access to it . Transportation that relates with safer, cheaper and more reliable
having importance to serve their customers by attaining this value of higher incomes for their
drivers and more job opportunities for them in the context of future aspects through maintaining
the value of industry.
Mission
This industry is having the mission it to generates the opportunities by setting up the
world in motion, the aim of this Uber industry is developing the strategies which relates with
emphasis on the new market is that ride sharing and take over on mobility market itself
(Madhushree, Kumar and Aithal, 2018). Uber business strategies focuses on liquidity network
effects, which involves with the growing up of the margin to focus on expanding the network.
Objectives
Uber technologies having the objectives is to offer the best services to their customers in
relation with the readily available transportation services in respect the rides and delivery
channels, the approach of this industry is to gradually and steadily increase the market globally
and introduce their services to the new cities and across the countries to develop the brand image
of this industry by allowing the riders and drivers to connect with Uber.
Strategy
This industry having the working structure of providing the value to their customers
deciding the strategies regarding the cost of the product or services by taking care of the
customers approaches towards the particular services through maintaining the practises of the
industry in relation to the services .
Macro environment
It refers to the condition which relates with environment of whole economy rather than
talking about the states and specific region, this aspects involve with gross domestic products,
inflation rate, fiscal policies, technological advancement and related with the monetary aspects
(Matzembacher and Meira, 2019). Basically the organisation on the basis of analysing the
external environment through PESTLE model which will determine which course of action is
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suitable of generating any strategy regarding the external forces, here is the PESTLE model for
company Uber Technologies by analysing their macro environment is that
Pestle Analysis
Its a process of analysing and determining the external forces which will impact the organisation
in the long run objectives and goals. This model is basically applying for the purpose of
generating the new strategies by focusing up on external factors which will continued with their
impact on the organisation by analysing the global environment (Pucheta‐Martínez and Bel‐Oms,
2019). Here are the factors which will impact the Uber Technologies in their long run are as
follows:
Political factor
This external factor relates with the government indulgence in the business through their value of
government trade policies and relates with stability and instability in the context of Uber
technologies here are the impacts are :'
 The indulgence of the government in different part of the world leads to formation in
change of the policies regarding the political aspects.
 This impact relates with political regulation for the drivers designation as contractors.
Economical factor
This factor relates with the interest rate, inflation rates, foreign exchange rate as this industry
works on across the countries by giving their services through rides and delivery of packages
will impact by the economic aspects is that :
 Because of the dynamic pricing model, this industry will be impact by different pricing
according to the economy.
 Because of the economic stability, competitors are giving tough competition to the Uber
technologies, through that they are bearing losses as per the record report.
Social factor
It involves with the individual attitude, perception, society culture and beliefs that will impact the
organisation , here is the social factor in the context of Uber technologies is that :
 This factor relates with the employee diversity which will create the differences of
handling the employees in respect of their languages and cultures (Xie and Cooke,
2019).
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 Having the aspects of multinational operations involves with reasonable rates and trust
worthy services .
Technological factor
This factor relates with the change in the environment through technological advancement across
the countries, the impact on company like Uber technologies is that:
 Self driving cars and autonomous cars in the future aspect which will going to be
benefited for Uber technologies.
 This factor develops the approach to meet the customers through the process of social
media channel too (Oldman and Tomkins, 2018).
 This will impact the industry by increasing the internet penetration and uses of smart
phones.
Legal factor
This factor involves with the legal considerations, laws and regulations that will imposed by the
government to assist the customers and the employees working in the industries by giving equal
opportunities through the value of legal aspects is that :
 The legal battle with waymo and lawsuits will tarnish the brand value of the company as
this lawsuits are imposed by the government , company will have to adopt the strategy
according to that aspects.
Environmental factor
It involves with the determinants which involves safety of the environment and concern
with the sustainability aspect in the future so here are the impact of environment on the industry
like uber technologies is that:
 Uber pool services are an Eco-friendly initiatives which will contribute towards the
attainment of the environment.
M1) Critically analysis the macro-environment to determine and inform the strategic
management decision :
UBER Technologies is operating its business in united states so they are having quite
tough competition in respect of its business operations, this industry as they are operating their
services across the countries they will going with several external forces which relates with
political, economical, social, technical related with innovative advancement and all the legal
regulation and laws has to follow by this industry to regulate their daily operations (Wadström,
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2019). Through analysing the PESTLE model which determine the external forces how they
really impact the industry like UBER they have to formulate their strategy according to the
specific external forces by adopting the value of opportunities in the global market, by making
changes in the strategies if needed by the organisation. As this industry works on the principle of
providing with the services like delivery packages and courier services so to attain the quality
services, organisation have to inculcate to their different countries business in respect to establish
the smooth functioning of the business without any obstacles. The company targets the metro
city to serve their operations while working on the customers need regarding the particular
services on which UBER works. The potential of this company will perform better through
analysing the market situation regarding their competitors in respect of the transportation
services in they working right now is that delivery packages, couriers etc.
TASK 2
P2) Analysis the internal environment and capabilities of the UBER :
The internal environment is basically relates with the company current performances
where its actually stands through defining the strength and weaknesses of the company through
analysing with the SWOT model which is necessary in the determination of company strength,
weaknesses , threats and opportunities (Maniora, 2018). These are the aspects on the basis of that
organisation like UBER going to formulate their strategies and change its operations if needed in
the future so here are the SWOT Analysis
This model refers to the process or methods which determine and analysis the
organisation current performances and the internal impact on the organisation on their operations
basically to know about the competencies of the organisation which will help in the course of
operating into the international market so here are the strength, weaknesses, opportunities and
threats is that:
Strength
 Having the extra edge into the market because of well recognized brand in international
market this will leads to give the benefits to that company through more popularity into
the customers.
 It relates with high standards services through providing with verified drivers and cars,
services on regular taxi will not applicable on UBER.
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 The prices in UBER are comparability low as compared to the regular taxi services.
Weaknesses
 The planning or idea on which this company works can be easily imitated , nothing will
stop the new company to enter and compete with company like UBER (Sánchez-Herrera,
and Donate, 2019).
 The loyalty factor in this company are lacking from the side of their drivers as they are
not exactly in real connection with the company, so they will shift to other same industry
if the job role is same with extra benefits to them.
 Having a very unpredictable working or business model.
Opportunities
 Customers because of the higher prices of regular taxi and traditional cabs will allow the
customer to shift towards the company like UBER.
 It will develop the great market into the country like India where the fair of the taxi are
comparatively incontinent and expensive through initiating into these market UBER will
grow their company opportunities.
 By using the cheaper electric car UBER will going to earn maximum profits as this will
reduce the cost and enhance the drivers earning.
Threats
 In this company employees is that drivers are not satisfying with their salary because and
low profit margins, this will generates the bad publicity into the mind of new drivers.
 Some new legal regulations are banning this company to operate their functions in the
market like Germany.
 Self driving car will eliminate this company functions as there is no need for the drivers.
McKinsey 7s Model
This process depicts the ways in which seven elements of the business will be merged to
increase the effectiveness . According to the framework of this model which involves with the
structure, strategy and systems that represent hard elements likewise values, skills, styles and
staff are considered with the soft elements, here are the McKinsey 7s model which will represent
the capabilities of the UBER Technologies is that:
Strategy
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The strategy onto which the company like UBER works is that this industry having cost
leadership business strategy (Chelliah and Swamy, 2018). The ride hailing giants in the
international market gains cost advantages through their internet based business models which
will affects the traditional taxi services by catering the customers through internet sources
Structure
This industry basically works on the hierarchical approach. They are getting affected
through the short comings of the hierarchical structure which involves with the ineffective
communication across the various department.
System
This industry relates with the large systems that are important for the long term growth of
the company, this process involves with the employees recruitment and the selection process,
basically company works on the principle of team development and orientation system, this
process also deals with customers relationship management systems as UBER app is critically
important aspect of the business.
Skills
This organisation depends upon their UBER application which depends upon the users as
this industry are more popular by their operations in the international market in respect of the
skill full drivers they will interact with the customers through online processes by their
applications which shows the ride and delivery options to their customers (Fraser, 2019).
Staff
This industry works on the principle of recruiting and selecting the peoples who are
having experience in driving and handling the driving terms better , the industry having with the
aspect of recruiting the people their job skills in respect of the staffing.
Style
This industry deals in the process of interacting with their customers through the medium
of UBER application which defines the value which is considered with online handling of the
customers.
Shared values
This aspects relates with the ethics and beliefs on which this industry works throughout
daily by given the opportunities to their drivers by reaching the customers through more rides
and attain the value of branding with it.
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M2) Critically evaluate the internal environment to access the strength and weaknesses :
As this industry works on an international level the process of this industry have to
depends upon the working structure of their operations like they are dealing in delivery
packages, courier and UBER taxi service so its necessary for the industry to work according to
the customers preferences regarding their rides and services related to the delivery channels,
company has to work on their core competencies by interacting with customers by the medium
of online application which will leads to enhance their capabilities to cover the strength and
handles the weakness (Kitsios and Kamariotou, 2019).
TASK 3
P3) Apply porter five forces model on UBER Technologies:
This strategic approach of porter five forces model will assist the UBER senior
authorities to have the effective understanding by analysing the competitors, rivalry amongst the
present players in the industry of transport, the bargaining power of its buyers and other aspects
by which an manager will understand and plan about their strategic approaches towards the
customers and present market scenario. So her are the porter five forces model on UBER
Technologies is that :
Industry rivalry
As this industry works worldwide and they deals different competitors in different
countries in US market UBER generally meets with the competitors like Lyft who have almost
the same working structure as UBER and they also compete with this industry through their
market shares, other competitors includes Ola, Grab etc. These competitors are compete on
different aspect like price, comfort, convenience and reliability. So here the industry rivalry is
quite high (Antamoshkina and Zinina, 2019).
Threat of new entrants
As this industry working on a low efforts in respect of cost to built is that this company
basically deals in that process where the drivers comes up with their own vehicle and register by
this company to do work and then become an employees without any long process, so its quite
easy for the new entrant to join this industry market without any problem by using this same
business model. Having very high threat of new entrant in the industry
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Threat of substitutes
This industry are facing the same convenience facilities by their competitors problem by
that the services in which this industry works are provided by their same industry type through
pricing and offerings to their customers , this substitute are the big threat for the company like
UBER as lots of customer can tends to move towards the local substitute services of the other
company also.
Bargaining power of suppliers
This industry are totally depends upon the suppliers as they does not own any of the
vehicles so they have to depend upon the drivers with their cars (Bentley-Goode, Omer and
Twedt, 2019). UBER outsource their driver services and the car which will give the suppliers
upper hands, thus the suppliers are having the high bargaining power because of the
dependability.
Bargaining power of the buyers
The buyers of the UBER will not considered as loyal cause due to the high substitute in
their industry types leads to the generation of distractions among the customer is that UBER will
not commit about the sustain customers because customers can choose any of their competitors if
the fare are high sometime. Buyers in case of UBER has high bargaining power.
M3) Device appropriate strategy to improve competitive advantages
As this industry works on the basic principle of providing the services to their customers
through giving them ride facilities and delivery channel packages so basically the organisation
have to be ensure about the competitive scenario to built something new from their competitors
as they have to perform better than that . This aspects relates with the strategies to define the
competitive advantages are as follows is that cost leadership strategy, differentiation strategy,
innovation something of different by their competitors, operational effectiveness strategy to built
internally,information advantages and the technological based competitive advantages this will
leads to the organisation growth in the context of its services in the market.
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Task 4
P4 Apply range of theories, concepts and models interpret and devise strategies planning for
given organisation.
Porter's generic model:
This is model was given by Michael Porter. This helps in examining the strategies by
which a company an accomplish their business objectives by gaining a competitive advantage
within the marketplace. When it comes to UBER, it is a mixture of cost leadership and
technology based distinction. UBER doesn't hire full-time drivers instead they use a networking
effect to increase the number of chauffeurs. Any individual who can drive and owns a car can
register himself as a driver and can earn and work with UBER. This is a cost effective technique
used by the company to ensure low expense on infrastructure and maintenance (Bıçakcıoğlu,
Theoharakis and Tanyeri, 2019). This ensures low priced cabs available to the customers. UBER
takes some percentage from the the drivers somewhat around 5% to 20% which is a very small
portion of the earnings. This gives drivers extra earnings and low prices for the customers with
more convenience. This is the way cost leadership benefits the company and has helped in the
expansion.
Technology based distinction is the main source of competitive advantage to the
company. Technology used by UBER is a mobile application that is made available on both
Google Play store as well as Apple App store. It helps connecting the riders and the chauffeurs to
ensure easily booked rides. This is an advancement for the customers and the company as people
now book the cabs easily and with less wait time when compared to the past conditions.
Ansoff Matrix of UBER:
Ansoff Matrix is a strategic planning tool that gives a scenario to help managers and
marketers to form strategies for further growth and productivity. In the context of UBER, the
model can described as under:
 Market Penetration: This is a growth strategy suggested by Ansoff matrix which
motivates an organisation to increase the sales of the current products and services in the
current market. UBER adopted this strategy as it engages itself in the markets by the use
of various sales promotion techniques for example providing promotion codes to the
loyal customers. Also, customers get a free if they invite and help joining new people in
the UBER family.
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