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 - – increasing household debt because of falling income levels, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, 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.
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.
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.
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.
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.
Highly skilled collaborators
– Uber Driver has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Uber Driver are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
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.
Innovation driven organization
– Uber Driver is one of the most innovative firm in sector. Manager in Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
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.
Effective Research and Development (R&D)
– Uber Driver has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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 -
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.
Low market penetration in new markets
– Outside its home market of Uber Driver, firm in the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Janet L. Rovenpor, Lisa T. Stickney, Rita J. Shea-Van Fossen suggests that, Uber Driver is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High operating costs
– Compare to the competitors, firm in the HBR case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Uber Driver 's lucrative customers.
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.
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.
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.
Increasing silos among functional specialists
– The organizational structure of Uber Driver is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Uber Driver needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Uber Driver to focus more on services rather than just following the product oriented approach.
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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Uber Driver supply chain. Even after few cautionary changes mentioned in the HBR case study - Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Uber Driver vulnerable to further global disruptions in South East Asia.
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.
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 -
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.
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.
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.
Loyalty marketing
– Uber Driver has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Better consumer reach
– The expansion of the 5G network will help Uber Driver to increase its market reach. Uber Driver will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Developing new processes and practices
– Uber Driver can develop new processes and procedures in Organizational Development industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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.
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.
Building a culture of innovation
– managers at Uber Driver can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Uber Driver can use these opportunities to build new business models that can help the communities that Uber Driver operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Uber Driver can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Uber Driver has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Uber Driver to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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.
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 -
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.
Increasing wage structure of Uber Driver
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Uber Driver.
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.
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.
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.
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.
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.
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.
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.
Regulatory challenges
– Uber Driver needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Organizational Development industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Uber and its Driver-Partners: Labor Challenges in the On-Demand Transportation Networking Sector, Uber Driver may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Uber Driver can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 .
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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