The Global Strategy Analysis Proposal
A Case of Uber Technologies Inc.
Date of Submission
The main challenge international businesses face is to draft strategies that are applicable across all countries they operate in. Global strategies are created to allow the company to meet its short and long term objectives of global or international expansion. Geographical factors such that the influence from the home and foreign countries, varied cultures and policies can influence the formulation of the global strategies. For the purpose of this paper, Uber Inc. is selected. Among the aspects covered in this paper include the SWOT analysis of the company, market and industry position of the Uber Inc., global strategies challenges and how Uber has encountered its global-related challenges.
Overview of the Company
Uber is a multinational company that specializes in food delivery, peer-to-peer rides and other transportation services like parcels. It is currently headquartered in California but operates in more than 780 cities across continents and countries. The day to day uber operations are mainly facilitated through their website and mobile app (Bugador, 2019). Clients are able to access drivers and taxi cars their mobile app; they have the freedom to choose the kind of car to use at any time. The installed app then uses Google maps and distance estimation tools to determine the price paid by the clients. With the ride-sharing app, people get to book a cab that is near and the driver will pick the customer from his or her door step and at any time.
We selected Uber Inc. since it is growing fast in the face of global challenges and competition. Equally, in the midst of negative criticisms and rising security threats, Uber has become the mainstream carrier in many cities of the world. According to their manager, they are planning to introduce new and advanced features for not only the for the benefit of their customers but also for the continuous growth of Uber as a company. It seems Uber’s global strategies are appropriate and have seen them meet their short and long term goals. In addition, Uber has constantly faced challenges in many cities of the world, thus, the best company for our analysis.
Market and industry position in the global market
According to Kolodny (2020), Uber considers the following companies as potential competitors. They include Apple, GrubHub, Taxify, DHL, Amazon, Tesla, and Lyft. Many users love Uber because it is convenient, easier to contact drivers and less costly compared to her direct competitor Taxify. Over 90% of the Uber’s users like the application because it displays reviews and allows customers to estimate prices instantly compared to curb, Didichuxing, Grab, Ola cabs, and Lyft. In Sub-Saharan Africa, Uber leads followed by Taxify and it controls over 70% of the region (Bugador, 2019). In Northern Africa, Taxify has not ventured into this region giving Uber a room to excel with a minor competition from Careem Company. In a bid to control and dominate Dubai and nearby regions, Uber has acquired Careem Company for about about $2 billion (Kolodny, 2020). In America, Uber leads in countries like United States (62%), Canada (69%) Mexico (56%) and it controls over 60% of the Brazilian market. However, Uber faces strong competition in countries like Chile, Colombia, Ecuador, Argentina, and Peru from Easy Taxi, Didi, BlaBlaCar, Cabify and Taxify companies. Ola, India-based company expanded to Australia and has constantly given Uber a stiff competition. Besides, GoCatch, local taxi company in Australia has also been making the operations of Uber challenging as many Aussies prefer the company (Kolodny, 2020).
Uber’s SWOT analysis
- All uber’s drivers are verified and certified, the cars are also verified thus providing reliable rides.
- It has a variety of cars and vehicles. Customers have the freedom to choose the kind of the car to book.
- All drivers are not hired on full time bases, therefore, uber is not reliable for all employees except those who are working in their offices.
- All interactions are facilitated through the application. Customers directly communicate with drivers. As a result, their operational costs are relatively low.
- It offers many features and services and allows cashless payment system.
- Compared to traditional taxi drivers and to some extent, their competitors; Uber’s prices are low.
- The application supports dual rating whereby the driver rates the customers and the customer on the other hand rates the driver.
- As it popular and it covers many towns; many people are willing to invest in this company thus providing funds to run the company.
- There is poor relationship between drivers and Uber officials and this has lowered the loyalty of many drivers.
- Most of drivers complain of poor payment and unfavorable laws. Maintenance of their cars is high in relative to their payment.
- The company has no direct relationship or contact with their customers. Drivers can easily steal their customers.
- The nature of their business model is unpredictable as they don’t have own the cars.
- Privacy concerns especially when it exposes personal details of customers to drivers. The applications lets the driver know where the client is going (Bugador, 2019).
- Traditional taxi cars are expensive dissatisfying as it takes long time before they get the service.
- Large markets especially in Middle East and India where people prefer taxi services.
- With advanced technology, cheaper electric cars that are economical in fuel consumption.
- Drivers are complaining of low pay and the company laws favors customers only.
- Complicated local authority laws and policies affects their operations in some cities.
- Increasing competitions especially in countries such as USA, Brazil and Mexico (Tao et al., 2019).
Global challenges facing Uber
In Europe, some drivers were protesting in Paris in the year 2015 as many of them felt that the application is biased. Equally, bases on regulations and laws in Bulgaria and Romania, the application was banned. The European rivals including London-based Luxury application, Mytaxi application in Germany. Currently, Uber only operates in only four town or cities including Dusseldorf, Munich, Berlin, and Frankfurt. In most of the African countries like Kenya, Egypt and South Africa; Uber Company has been criticized by political leaders and agencies as it becomes a monopoly company (Grant, 2016). Uber withdrew from some countries in Asia and now is working hard to control the market in India and perhaps beat Ola, a local company. Brazil and Mexico put strict regulations on the operations of Uber while in Argentina, there were protests by the taxi drivers making it difficult.
How Uber has dealt with the challenges
The company is working hard to comply with the laws and regulations in countries like Bulgaria and Romania in a bid to access the markets. The main competitors in India and South Africa are really giving the company a hard time. Uber has resorted to provide flexible packages, low prices and including many features such as reviews. It has also invested in marketing especially in India to overturn Ola Company which is an Indian company. Over the last 2 years, Uber has significantly reduced prices as a way of maintaining customers and increasing sales. It is also planning to train their drivers especially on how to handle clients (Do et al., 2017).
|Gathering resources about Uber company including scholarly articles.|
|Literature Review, Identifying gap in research
Sampling global strategy analysis cases
|Discussion and findings. The team will meet and discuss widely on these areas.|
|Preparing recommendations and conclusions|
|1 days||Proofreading and formatting the term paper.|
Bugador, R. (2019). The Global Expansion of UBER in ASIAN Markets. Int. J Sup. Chain. Mgt Vol, 8(2), 569.
Do, H. Q., Massa, F., Tison, T., & Lallemand, B. (2017). A global strategy for the stability analysis of friction induced vibration problem with parameter variations. Mechanical Systems and Signal Processing, 84, 346-364.
Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
Kolodny, L. (2020). Uber lists competitors such as Alphabet and Amazon and addresses past scandals in its filing to go public. Retrieved 25 January 2020, from https://www.cnbc.com/2019/04/11/uber-s-1-risk-factors-competitors-deleteuber-campaign-reputation.html
Tao, M., Yuqiao, G., Nawaz, M. Z., & Shafique, M. N. (2019). A Comparative Analysis of the Business Models of Uber and Didi under Sharing Economy Background. Sarhad Journal of Management Sciences, 5(1), 27-46.