UBER - sharing economy

PowerPoint Presentation

UBER: Evolution of the sharing economy

Aaron

JackSatishDevang

MGMT 5061 - Managing Service Design and Operation | Professor Ramiro Jara

Evolution To A Sharing EconomyEconomy Stage 1According to Adam Smith (1876) the market was the invisible hand connecting producers to consumers

Economy Stage 2The Firm Economy:The producers organized into firms as a means of increasing production and metering of labor

MGMT 5061 - Managing Service Design and Operation | Professor Ramiro Jara | Team II: Aaron, Devang, Jack, and Satish

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Economy Stage 3The Sharing economy where businesses provide platforms for P2P sharing of underutilized assets

I NeedYou HaveService woven in TRUST & EFFICIECY

WE ARE HERE

Group 2 Crystal Ball: Economy Stage n

Trekonomics?

[service and]the acquisition of wealth is no longer the driving force of our lives. We work to better ourselves and the rest of humanity, Captain John Luc Picard

Launched in 2010, Uber is the largest cab company but doesnt own any car first global transportation brand UBER: Market Cap $66 B | Employees: 7KBMW: Market Cap $53 B | Employees: 116K

Shared Economy- Zero cost to start vs. high cost medallion taxi- Shared revenue (70 80% of the fare) - Rewards with discounts- 40% more $ compare to cab drivers - Helping to improve earnings and reduce unemployment - Pay for different service level - Rush hours vs. off-peak rates - Comfort of auto pay through the app - No capital investment for cars, high margin, less liability- 20 to 30% of the fare, plus advertisement revenue- Lean operation, Average three people per city - Scalable crowd sourcing (variability - arrival)- Adoption through local competition

FlexibilityDriversCustomersUber/EmployeesPart Time, Full Time, Be your own bossUberBlack, UberX, UberPool (variability-request) Effort: Only digital customer touch points (app, email, text), no CSR employed

MGMT 5061 - Managing Service Design and Operation | Professor Ramiro Jara | Team II: Aaron, Devang, Jack, and Satish 3

- No taxi bring vs. new brand and market Physical BMW but Uber as servicebut normal taxi would have made big capital investment

Million rides a day (2 Billion rides till date), 400 cities, 70 countries, 160,000 drivers in US alone

Normative Control- Rate passengers - Car quality inspection for new drivers - Community Trust- Customer picture/name shared to create the personal connection - Rate drivers- Community Trust - Safety: ability to share ride in real time- Driver picture/name shared to create the personal connection - Customers doing most of the work to schedule ride using technology platform - Community based foundation for trust

DriversCustomersUber/Employees

MGMT 5061 - Managing Service Design and Operation | Professor Ramiro Jara | Team II: Aaron, Devang, Jack, and Satish 4Community- New economy engine influenced by the Uber model. - Pulling part timers back into workforce - Reduction in unemployment - 24/7 driver support and insurance coverage

- Safety: reduced number of drink and drive incidents - Environment friendly (Uber Pool) - Can reach assigned driver via text or phone- Pride of brand association - The dispatch software/algorithm links the passengers to drivers - Leverages data analysis to translate data into dynamic pricing

Mapping To The Service Value Chain Normative Customer ratingsStandards of vehiclesCategorization of vehicles Efficient App/ Platform

Employee RetentionExternal Service ValueCustomer SatisfactionCustomer loyaltyRevenue GrowthProfitability

Drivers are masters of their own schedulesDrivers are rated by many customers as an appraisal systemRiders shared prosperity model with UberRiders rate the service based on parameters.Drivers who consistently get low ratings are dropped from the service.On the App customer satisfaction is gatheredIncentives to customers and promos are provided to enhance customer satisfactionUber is reaping inherent trust in the new economyConvenience and level of service drives customer loyalty

Employee SatisfactionInternal Service QualityCosts of Driver retention are low

Customer loyalty is driving more use of the service and customer advocacy to other potential customersUnder Ubers shared prosperity model, drivers are incentivized to keep riders satisfied which drives more volume and bottom lineEmployee Productivity


Successfully Evolving with the Shared Economy

Drivers of SuccessInternal Service QualityEmployee SatisfactionExternal Service ValueCustomer Loyalty

Customer SatisfactionThe nature of the shared economy ensures that changing competitive, customer, and technical dynamics in the ecosystem will greatly speed the evolution of service design operations

Analogs of the Past and FutureCompetitive ConsiderationsCustomer ConsiderationsTechnical ConsiderationsRelationship status? it is complicated

Rapidly Changing EnvironmentNimble and ModularLeading a shared economyImproving the crystal ball Driverless vehiclesTech and Functional ArchitectureUber and Waze Uber and GoogleNapster and iTunesUber and .


?Thank You QUESTIONS? MGMT 5061 - Managing Service Design and Operation | Professor Ramiro Jara | Team II: Aaron, Devang, Jack, and Satish 7

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APPENDIX


http://expandedramblings.com/index.php/uber-statistics/ How it works99

40% more earning10



http://www.businessinsider.com/uber-doubles-its-drivers-in-2015-2015-10 1111

http://www.bizjournals.com/

Leadership & Management

UBER - sharing economy