Uber and the Sharing Economy: Global Market Expansion and Reception SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Uber and the Sharing Economy: Global Market Expansion and Reception
Alexander Cooper is gearing up to lead an expansion strategy for the scrappy and super successful car sharing service, Uber. While the company has not been without its controversy, it is making headway in far off places like India. It is looking to scale its model in India, China, and the rest of Southeast Asia, but is increasingly running into regulatory hurdles. Cooper is forced to think hard about what Uber's expansion strategy should be and how it will impact the company's operations. Uber currently markets itself based on word of mouth, but in markets like China where two companies dominate 99% of market share, this may be unrealistic. What path should this sharing economy company take?
Swot Analysis of "Uber and the Sharing Economy: Global Market Expansion and Reception" written by Andrew Hoffman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Uber Cooper facing as an external strategic factors. Some of the topics covered in Uber and the Sharing Economy: Global Market Expansion and Reception case study are - Strategic Management Strategies, Economy, Emerging markets, Globalization, Internet, IT and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Uber and the Sharing Economy: Global Market Expansion and Reception casestudy better are - – supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Uber and the Sharing Economy: Global Market Expansion and Reception
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Uber and the Sharing Economy: Global Market Expansion and Reception case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Uber Cooper, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Uber Cooper 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 the Sharing Economy: Global Market Expansion and Reception can be done for the following purposes –
1. Strategic planning using facts provided in Uber and the Sharing Economy: Global Market Expansion and Reception case study
2. Improving business portfolio management of Uber Cooper
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Uber Cooper
Strengths Uber and the Sharing Economy: Global Market Expansion and Reception | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Uber Cooper in Uber and the Sharing Economy: Global Market Expansion and Reception Harvard Business Review case study are -
Learning organization
- Uber Cooper is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Uber Cooper is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Uber and the Sharing Economy: Global Market Expansion and Reception Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Strategy & Execution industry
– Uber and the Sharing Economy: Global Market Expansion and Reception firm has clearly differentiated products in the market place. This has enabled Uber Cooper to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Uber Cooper to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Uber Cooper is one of the leading recruiters in the industry. Managers in the Uber and the Sharing Economy: Global Market Expansion and Reception are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Uber Cooper 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 Cooper has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Uber Cooper to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Uber Cooper 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 the Sharing Economy: Global Market Expansion and Reception - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Uber Cooper in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Uber Cooper in the sector have low bargaining power. Uber and the Sharing Economy: Global Market Expansion and Reception has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Uber Cooper to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Uber Cooper has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Uber and the Sharing Economy: Global Market Expansion and Reception 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.
High switching costs
– The high switching costs that Uber Cooper 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Uber Cooper digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Uber Cooper 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.
Analytics focus
– Uber Cooper 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 Andrew Hoffman 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.
Weaknesses Uber and the Sharing Economy: Global Market Expansion and Reception | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Uber and the Sharing Economy: Global Market Expansion and Reception are -
Lack of clear differentiation of Uber Cooper products
– To increase the profitability and margins on the products, Uber Cooper needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Uber and the Sharing Economy: Global Market Expansion and Reception, it seems that the employees of Uber Cooper don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Workers concerns about automation
– As automation is fast increasing in the segment, Uber Cooper 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.
Skills based hiring
– The stress on hiring functional specialists at Uber Cooper 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.
Products dominated business model
– Even though Uber Cooper 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 the Sharing Economy: Global Market Expansion and Reception should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Uber and the Sharing Economy: Global Market Expansion and Reception HBR case study mentions - Uber Cooper 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.
Increasing silos among functional specialists
– The organizational structure of Uber Cooper is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Uber Cooper needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Uber Cooper to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Uber Cooper 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.
Interest costs
– Compare to the competition, Uber Cooper has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow decision making process
– As mentioned earlier in the report, Uber Cooper 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 Cooper 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Uber and the Sharing Economy: Global Market Expansion and Reception 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 Cooper 's lucrative customers.
Opportunities Uber and the Sharing Economy: Global Market Expansion and Reception | 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 the Sharing Economy: Global Market Expansion and Reception are -
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 Cooper can use these opportunities to build new business models that can help the communities that Uber Cooper operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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 Cooper can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Uber Cooper 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 Cooper to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Uber Cooper 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.
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 Cooper 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Uber Cooper can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Uber Cooper can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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 Cooper in the consumer business. Now Uber Cooper can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Uber Cooper can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
Using analytics as competitive advantage
– Uber Cooper 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 the Sharing Economy: Global Market Expansion and Reception - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Uber Cooper to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Uber Cooper 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.
Leveraging digital technologies
– Uber Cooper 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.
Buying journey improvements
– Uber Cooper can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Uber and the Sharing Economy: Global Market Expansion and Reception 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Uber Cooper in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Threats Uber and the Sharing Economy: Global Market Expansion and Reception 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 the Sharing Economy: Global Market Expansion and Reception 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 Cooper in the Strategy & Execution sector and impact the bottomline of the organization.
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 Cooper needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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 Cooper.
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 Cooper business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Uber Cooper can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Uber Cooper with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Uber Cooper
– 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 Cooper.
Environmental challenges
– Uber Cooper 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 Cooper can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 the Sharing Economy: Global Market Expansion and Reception, Uber Cooper may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Technology acceleration in Forth Industrial Revolution
– Uber Cooper has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Uber Cooper needs to keep up with the evolution of technology in the Strategy & Execution 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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Uber Cooper can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Shortening product life cycle
– it is one of the major threat that Uber Cooper is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Uber and the Sharing Economy: Global Market Expansion and Reception 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 the Sharing Economy: Global Market Expansion and Reception 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 the Sharing Economy: Global Market Expansion and Reception 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 the Sharing Economy: Global Market Expansion and Reception 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 the Sharing Economy: Global Market Expansion and Reception 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 Cooper needs to make to build a sustainable competitive advantage.
