Essay on Innovation Strategic Situational Analysis

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Innovation & Strategic Situational Analysis
Abel Garcia, Miguel Gutierrez, Karan Mody, Jamie Moody
STR 581
April 30, 2015
Dr. Kamal Ranasinghe

Innovation & Strategic Situational Analysis
For many years people have relied on public transportation and taxis; however, Uber has managed to change the world of transportation with some help of technology. This business has made requesting transportation more convenient, affordable, safe and quick. This is the business that has managed to connect drivers and customers though and application, the application ensures that customer and the driver are within the terms and conditions of Uber. This business has grown immensely in many countries including the United States in a short time frame; for these reasons, this Learning Team has chosen this business. In this essay the team will discuss the structure of the business, SWOTT strategies, the Porter 5 forces model, the competitive situation and a simple assessment will be included.
Organizational Structure
Uber business has managed to be very successful, this is due to the business organizational Structure. This aspect of the business is very important, because such business needs to be advertised, organized and tasks must be given according to personnel responsibility. The organizational structure to best fit this business would be a functional organizational structure. According to Pearce and Robinson in 2013, a functional organizational structure is when the business decides to separate the tasks to certain people, identify the technology that is necessary and yet essential to the company, in addition there are also policies that must be practiced to ensure that the company is functioning at its best. This company fits this structure best because the drivers are self-employed contractors to Uber Company, advertisement is highly used, policies and procedure are always put into action. After all this is a service that has become very successful, this strategy has divided these tasks from drivers, sales representatives, finances, advertisements and so on; therefore, providing growth for the company and employees.
Uber is a transportation technology company that brilliantly connects the transportation industry with technology via its ride-sharing Smart-Phone ride-sharing application (App). Uber has its service offerings in over 200 cities in 53 countries by 2014. Currently, Uber has been valued at over US $40 billion and the researcher expects that the organization will have yearly revenue of $10 billion by 2015.
A SWOTT analysis has been done on Uber that will help the researcher explore the opportunities and threats of Uber and also identify Uber’s strengths and weaknesses which are the internal factors of the organization for which they have control over these elements. Opportunities and weaknesses are the external factors of the organization and so, Uber does not have any control over these.
Uber has a high standards of service.
Uber has an unrestricted fleet of vehicles.
Uber has no employees and so everyone in their team is an independent contractor.
Dispatcher is not needed for Uber Operations as they rely on customer-to-driver interaction.
As cashless payment system is used.
Uber gives their independent drivers the flexibility to manage their own work hours whether it be full-time or on a part-time basis.
Contractors have the ability to choose their own clients.
The prices are lower compared to traditional taxi operators.
The app idea can be easily imitated.
Customer safety with Uber is a questionable as they do not have any real connection with their drivers since they are independent contractors. So, it is expected that loyalty between Uber and its drivers is quite low.
Due to low prices, an incentive for an existing driver to remain with Uber is low.
Many companies have adopted the Uber business model which has increased competition in the transportation market.