Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector
This case explores the nature of the relationship between Uber Technologies, Inc., and its driver-partners. Uber touted itself as a technology company that licensed an app to independent contractors acting as drivers. However, some Uber driver-partners were unhappy and their lawyers filed lawsuits seeking class action status. The driver-partners believed that Uber should have treated them as employees and should have given them benefits (e.g., workers' compensation and reimbursement for their expenses). They complained that Uber unfairly denied them gratuities. The case provides a brief history of Uber Technologies, its competitors, and the taxi and limousine industry, discusses the requirements for working as an Uber driver-partner, and delves into litigation related to Uber's labor practices. It raises substantial questions about how to classify workers (employee v. contractor) and how to develop human resource practices in the sharing economy.
Authors :: Janet L. Rovenpor, Lisa T. Stickney, Rita J. Shea-Van Fossen
Swot Analysis of "Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector" written by Janet L. Rovenpor, Lisa T. Stickney, Rita J. Shea-Van Fossen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Uber Driver facing as an external strategic factors. Some of the topics covered in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector case study are - Strategic Management Strategies, Managing yourself and Organizational Development.
Some of the macro environment factors that can be used to understand the Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector casestudy better are - – there is increasing trade war between United States & China, geopolitical disruptions, challanges to central banks by blockchain based private currencies, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs,
banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Uber Driver, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Uber Driver operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector can be done for the following purposes –
1. Strategic planning using facts provided in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector case study
2. Improving business portfolio management of Uber Driver
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Uber Driver
Strengths Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Uber Driver in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector Harvard Business Review case study are -
Training and development
– Uber Driver has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Organizational Development field
– Uber Driver is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Uber Driver in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Uber Driver is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Uber Driver has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Uber Driver to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Uber Driver
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Uber Driver does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Uber Driver has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Uber Driver in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Organizational Development industry
– Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector firm has clearly differentiated products in the market place. This has enabled Uber Driver to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Uber Driver to invest into research and development (R&D) and innovation.
Analytics focus
– Uber Driver is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Janet L. Rovenpor, Lisa T. Stickney, Rita J. Shea-Van Fossen can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Uber Driver digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Uber Driver has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to recruit top talent
– Uber Driver is one of the leading recruiters in the industry. Managers in the Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Uber Driver in the sector have low bargaining power. Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Uber Driver to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Uber Driver is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector HBR case study mentions - Uber Driver takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the segment, Uber Driver needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Need for greater diversity
– Uber Driver has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Aligning sales with marketing
– It come across in the case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector can leverage the sales team experience to cultivate customer relationships as Uber Driver is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector, is just above the industry average. Uber Driver needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Uber Driver has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Uber Driver has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Uber Driver even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Products dominated business model
– Even though Uber Driver has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Skills based hiring
– The stress on hiring functional specialists at Uber Driver has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Opportunities Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector are -
Leveraging digital technologies
– Uber Driver can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Creating value in data economy
– The success of analytics program of Uber Driver has opened avenues for new revenue streams for the organization in the industry. This can help Uber Driver to build a more holistic ecosystem as suggested in the Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector case study. Uber Driver can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Uber Driver can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Manufacturing automation
– Uber Driver can use the latest technology developments to improve its manufacturing and designing process in Organizational Development segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Uber Driver to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Uber Driver to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Uber Driver is facing challenges because of the dominance of functional experts in the organization. Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Uber Driver can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Uber Driver in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Uber Driver to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Uber Driver in the consumer business. Now Uber Driver can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Uber Driver can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Uber Driver can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Uber Driver to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Uber Driver.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Uber Driver in the Organizational Development sector and impact the bottomline of the organization.
Environmental challenges
– Uber Driver needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Uber Driver can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Uber Driver business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Uber Driver can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Uber Driver in the Organizational Development industry. The Organizational Development industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Uber Driver with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Uber Driver has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Uber Driver needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Uber Driver needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Consumer confidence and its impact on Uber Driver demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Uber Driver high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Weighted SWOT Analysis of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Uber Driver needs to make to build a sustainable competitive advantage.
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