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This unit has the following learning objectives:   To understand the concept of the Business Organization and how they emerged as a product of human civilization and the contributions made. Examine the role and nature of various forms of Business Organization and how they operate. Recognize the ongoing role of Business Organizations in the 21st century in achieving outcomes for business and society.  Consider the various choices that a potential business owner needs to consider in establishing a business and selecting an appropriate structure under which to operate now and into the future.  Apply knowledge and skills gained from this unit towards resolving business challenges and issues.    

Business Organizations are one form of the many organizations operating in our society. They exist primarily as a key form designed to facilitate human interactions and conversions and exchanges of tangible and intangible resources. These exchanges are designed to maintain an efficient economic market and sustain fair and reasoned stable social system providing sufficient benefits for social cohesion. In other words Business Organizations provide a coordinating capacity within the socio-economic framework of our world. As a definition the following is offered: A business organization is an individual or group of people that collaborate to achieve certain commercial goals. Some business organizations are formed to earn income for owners. Other business organizations, called nonprofits, are formed for public purposes. 

Learning Objectives

A taxicab is one of the ways of transportation in metropolises everywhere the world. The most important challenge that the taxicab industry is now facing the technological invention of ride-sharing applications. UBER function with a smartphone application to match the driver with demanding of consumers rides that will pick them there. The idea has founded the technology of UBER in the year of 2009. They using the technology to give customers what they need and when they need it. The idea of UBER is transporting supply and demanding for the ride and sending services together. UBER proposals and arrangement of ride services. Now UBER is present near 500 cities and near 70 countries around the world. Now UBER service is recognized in various countries.

Critical issues on UBER

The Corporation has a complete Privacy Package and borrowed a knowledgeable Managing Guidance for Privacy to make available the council and legal advice to the organization on privacy matters, Together with directing and managing the Confidentiality Program. The Program is sensibly designed to defend the privacy of Customer Data and address the risks related to the disclosure, use, and collection of Customer Data (Lovells, 2015). The Management Council for Confidentiality goes on with the implementation, enhancement, and design of the Confidentiality Program. The Business has recognized an appropriate quality at the top, with senior management emphasizing confidentiality in infrastructures to employees. The Company frequently measures the Confidentiality Program and is ongoing to advance controls and processes that state to privacy risks.

SWOT analysis of UBER

UBER is an advanced company. They have brilliantly links and technology in transportation business via its application. A SWOT analysis looks like the best decision, in this circumstance. SWOT will help to explore the Strengths, weaknesses, threats, and opportunities of a business.

Strengths

UBER is a well-recognized brand. It has standard service, great, certified cars, and drivers. The user of UBER black, they enjoy very standard service, they have the limitless fleet of cars, Regular Taxi facility protocols are not valid for UBER, and their drivers are not available for full times. Working cost is low and it depends on the communication of driver to the customer. UBER has no major challenger or competitor. They used without cash payment system. They select highly valued drivers and also they can track. UBER has many other options like how to getting a car quickly and easily (Lakshminarayanan, 2016).

What are Business Organizations?

Weaknesses

The knowledge can be easily copied. Presenting of the same product will not prevent for competition. The connection between drivers and UBER is just doubtful. It absences the actual connection. That’s why loyalty is probably between drivers and UBER is low. Similarly, there is no binding on company and customers (Van?k, Mikoláš and Žváková, 2012). Vehicles opening cost is very high. But problem is that the earning of the drivers is low. This is the Very Random business model.

Threats

The drivers are not happy due to the low margins of incomes that can cause bad publicity. They face some problems with local establishments that can causes penalties. Price is reduced due to increasing competition. When the drivers joining and start their career it will depress them. This is the result of losing customer and income of UBER will decline (Lakshminarayanan, 2016).

Opportunities

Due to more waiting time and high price the customers are not pleased with the traditional cab. Taxi services are problematic and luxurious in some countries where it can eat new and big marketplaces (Composites industry gets SWOT analysis, 2001). Unavailable taxi service in the residential area where the market value gross. The Estimated of Arrival time will reduce with increasing UBER drivers. That’s why everyone like UBER. It will earn more money and it will profitable for drivers.

Pestle analysis of UBER

Pestle denotes political, economic, social, technological, legal, and environment.

Political

The present political factors measured for UBER are as follows. These factors control the range to the government could effect on the certain business or the economy (Sekhonyane and Dugard, 2016). The Australian government may include new tax or responsibility due to complete income making structures of organizations might alteration. Tax policies, trade, tariffs, tax policies all are included in Political factors. On fiscal year government may charge and its effects on the environment of business. Government commercial license is required for opening a business. Laws of taxi industry is depended on the political conversation about minimum gross ("PESTEL: Increasing market demand opens", 2015).

Economic

These issues are bases of a performance on an economy that straight impacts a business and longtime effects (Schweinberger, Knowlton, Widlicki, & Gorelle, 2017). This disposable income high in Australia. Increasing rate of the economy will effect on price and services. Growing incomes in the business sector rising demand for private transport. Economic factors contain interest rates, rates of foreign exchange, inflation rate and economic growth (Cairns and Liston-Heyes, 1996).

Critical Issues with Uber

Social

These factors measured the social atmosphere of the market, measurement factors like demographics, cultural trends, and analysis of the population. In cities, Population density is growing. In the urban area, transportation demand is increasing, and that's why people like UBER (Wen et al., 2017).

Technological

These factors relate to revolutions in technology that might be the affect the processes of the business and the business positively or unfavorably. It denotes to research, automation, growth and technological consciousness that a business process. Automobile productions effort on technologies for an extra maintainable vehicle. UBER use the mobile application and its help them to continue their process as well.

Legal

This factor denotes both internal sides and external sides. There are particular rules that effect on environment business in a particular country though there are particular though particular procedures that UBER maintain themselves. Legal inquiry takes into explanation both of angles and then conversations out the plans in light of legislations like safety, laws of customers, laws of an employee ("PESTEL: Increasing market demand opens", 2015).

Environmental

These factors denote all effect or are strong-minded by the nearby environment. Tendency goes towards with maintainable transportation and environment-friendly. Increasing demand for Hybrid and Electrical cars is rising the business of UBER.

Threat of new entrant

  • Lacks protection from the new firms which might enter this taxi business
  • UBER had to invest quite a big amount during initiation which the new entrant might do it in lesser amount.
  • The application provided at free cost to the customers can be switched at will(Schneider, 2015).
  • Does not own a single vehicle in its fleet.
  • Depended highly on the partners and the drivers to run the company
  • The owners of the cars has the freedom to choose between the organization and its rival organization.
  • Suppliers plays a good role in the company’s performance.
  • Regular service is not always required
  • Can choose between UBER and the other rival companies
  • The customers are sensitive to price
  • The buyers has immense power which can limit the revenues.

Threat of substitute

  • The industry of network transportation is a huge umbrella with many member organization
  • The number of competitors are so huge that UBER is barred from raising the service rates.
  • A slight increase of rates can lead to loss of customers to rivals
  • The threat of the substitutes is a huge threat for the company.

Rivalry with other companies

  • Most of the companies operating in this sector are identical in operations and business model.
  • UBER has well established business network
  • It has huge number of capital investment.
  • The competitors are weaker forces in comparison to UBER’s network (Schneider, 2015).

7s of framework for UBER

  • Initial adopter movement – Marketing on the basis of word of mouth has been UBER’s prime strategy. They started this with the help of the movers and shakers of the Silicon Valley who talked in favor of the brand. The techies were looking forward to something a service or product which would transform their life. Other initiatives that they took were giving free trial rides, sponsoring events, also taking up hyper strategy oriented for the local people (Wierenga, 2002).
  • Referrals: The early persons who opted or came to know about UBER took advantage of the referral program which does provide free ride for the friends as well as earning credits as well for themselves. This give and take referral policy helped in boosting the business more efficiently.
  • Reviews: The one thing which makes UBER stand out from its other rivals is the rating system for driver as well as the passengers. The drivers do get motivated due to the feedback and help the passenger to analyze where they actually stand. Thus this works on two ways first the feedback system help promoting trust for UBER as well as getting better behavior from the driver and the passenger as well.
  • Stunts: Every time Uber dispatches another astonishing offer, get-togethers of millennials around the world cheer. Every so often the affiliation passes on little felines to working environments and specific conditions it grants travelers to have ride with the entertainers who came as complimentary gifts.
  • Affiliations: UBER was successful in having various partnership programs for the loyal and the first time customers who are opting for an UBER ride. The persons who hold credit card of Capital One gets discount on their rides. They also get hotel points sponsored by Starwood Hotels whenever they take a ride in UBER. The Spotify users are able to link their account and listen to their favorite music while riding in UBER.
  • A Loyalty Program: Most of the customers are unaware that UBER has enlisted a loyalty program in their marketing strategy. Service of UBER VIP is available to the persons who has availed to more than 100 rides in UBER. The benefit of being UBER VIP is that the customers get service of UBER’s highest rated drivers. The program also shows a gratitude and commitment to its most loyal customers.
  • An Omni-Channel Approach: UBER has multiple channel products and marketing strategy. UBER did not only work on a single aspect but they tackled an array of systems which included seamless payment, mobile hailing, driver’s rates, no tips and as well as better and luxurious cars(Wierenga, 2002).

Strategic challenges 

UBER delivers the best way in dealing transportation. UBER developed an app which helps link drivers to riders. By using this app user’s decrease the pressure involved with getting good, retrieve revenue on stockpiling receipts is the concern on dependable drivers. Uber delivers its services in many areas internationally. All user can check sensibly through records of driving beside criminal records. The vehicles are verified through several steps previously they are accepted and join the team of UBER. All information recorded like price/kilometer, distance etc. with help of their application. UBER expressions some problems with his policy. Challenging on the minimum price can make unhappy to the drivers but it suitable fee for customers. In truth though, drivers can’t receive any income from customers (Schweinberger, Knowlton, Widlicki, & Gorelle, 2017).

Conclusion

The taxi manufacturing’s revolution has not been existent in present year in advance technology. Perhaps Taxi Corporation offered medallions thought that the organization will remain forever in the competition or protection. The multi-medallion proprietors were too eventful viewing medallion values skyrocket to notification periods were varying. The taxi production became satisfied and the advance using of ride apps took the business storm.

UBER’S huge success has presented that there is the underprovided market. Rather a revolution that has complete for-hire transport more effective. It does so by improving some of the invalid principles with taxis that speak to some of the instruction distresses sharing of a ride. Both ride-sharing and taxi made an argument that the providing transportation is unfair to them. In the end, the suggestion would agree on both units cohabit and their shared benefits would deliver a more effective for-hire market of transport.

References

Azevedo, F., & Maciejewski, M. (2015). SOCIAL, ECONOMIC AND LEGAL CONSEQUENCES OF UBER AND SIMILAR TRANSPORTATION NETWORK COMPANIES (TNCs). DG IPOL Policy Department B - Structural And Cohesion Policies. Retrieved from https://www.europarl.europa.eu/RegData/etudes/BRIE/2015/563398/IPOL_BRI(2015)563398_EN.pdf 

Cairns, R. and Liston-Heyes, C. (1996). Competition and regulation in the taxi industry. Journal of Public Economics, 59(1), pp.1-15.

Composites industry gets SWOT analysis. (2001). Materials Today, 4(3), p.21.

Hall, J., & Krueger, A. (2015). An Analysis of the Labor Market for Uber’s Driver-Partners in the United States. Retrieved from https://s3.amazonaws.com/uber-static/comms/PDF/Uber_Driver-Partners_Hall_Kreuger_2015.pdf

Lakshminarayanan, V. (2016). SWOT ANALYSIS. SWOT ANALYSIS & RECOMMENDATIONS 2016. Retrieved from https://s3.amazonaws.com/coursera-uploads/peer-review/gmsPUNGEEeSHqyIAC1AQBw/ca1fbc66e90a0d117ae766438fbe21a4/Uber-Swot-Analysis-and-Recommendations-2016.pdf

Lovells, H. (2015). Review and Assessment of Uber’s Privacy Program. Retrieved from https://newsroom.uber.com/wp-content/uploads/2015/01/Full-Report-Review-and-Assessment-of-Ubers-Privacy-Program-01.30.15.pdf

Morris, J. (2008). Market Analysis for RidePartner. NDSS Ridepartner Marketing Analysis. Retrieved from https://dynamicridesharing.org/resources/TeamForesight_Market_Analysis_v14.pdf

PESTEL: Increasing market demand opens. (2015). https://www.slideshare.net/EvelynSindermann/uber-germany-50692166/14-PESTEL_Increasing_market_demand_opens.

Schneider, A. (2015). Uber Takes the Passing Lane: Disruptive Competition and Taxi-Livery Service Regulations. Elements, 11(2).

Schweinberger, S., Knowlton, B., Widlicki, M., & Gorelle, S. (2017). Uber in South Africa. International Strategy Division. Retrieved from https://mbacasecomp.com/wp-content/uploads/2017/01/DeGroote-3.pdf

Sekhonyane, M. and Dugard, J. (2016). A VIOLENT LEGACY: The taxi industry and government at loggerheads. South African Crime Quarterly, (10).

Van?k, M., Mikoláš, M. and Žváková, K. (2012). Evaluation Methods of Swot Analysis / Metody Vyhodnocení Swot Analýzy. GeoScience Engineering, 58(2).

Wen, J., Zou, M., Ma, Y. and Luo, H. (2017). Evaluating the Influence of Taxi Subsidy Programs on Mitigating Difficulty Getting a Taxi in Basis of Taxi Empty-loaded Rate. International Journal of Statistics and Probability, 6(2), p.9.

Wierenga, B. (2002). On Academic Marketing Knowledge and marketing Knowledge that Marketing managers Use for Decision-Making. Marketing Theory, 2(4), pp.355-362.

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My Assignment Help (2021) Understanding The Concept And Challenges Of Business Organizations: An Essay On Uber's SWOT Analysis. [Online]. Available from: https://myassignmenthelp.com/free-samples/mgmt20144-management-and-business-context/ride-sharing-applications.html
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