Contemporary Business Strategy

Assignment Brief

Information

This assignment is designed to assess learning outcomes:

This assignment is an individual assignment.

This assignment requires you to:

You have been asked to review the “Uber’s” external and internal environment, strategic position (business, corporate and international level strategies) and to suggest ways to grow and improve its profitability (competitive advantage).

Discuss the approach in detail how you will do this.

You need to apply any academic models or frameworks that you would use to support your analysis.

Sample Answer

Strategic Review and Growth Recommendations for Uber

Introduction

Uber Technologies Inc., founded in 2009, has revolutionised urban mobility by introducing a technology-driven ride-hailing platform that connects drivers and passengers via a mobile app. The company has since expanded into food delivery, freight transport, and other mobility services across more than 70 countries. While Uber has achieved remarkable global growth, it operates in a highly competitive and heavily regulated market, with persistent profitability challenges.

This report outlines a detailed approach to reviewing Uber’s external and internal environment, evaluating its strategic position across business, corporate, and international levels, and proposing strategies to improve profitability and sustain competitive advantage. The analysis will be supported by established academic models and frameworks, ensuring a rigorous and evidence-based evaluation.

External Environment Analysis

A comprehensive understanding of Uber’s macro-environment is essential for identifying opportunities and threats. The PESTEL framework (Johnson et al., 2020) will guide the analysis:

• Political: Government regulations on ride-hailing services, labour classification of drivers, and safety requirements vary significantly across countries. For example, the UK Supreme Court’s 2021 ruling that Uber drivers are “workers” rather than independent contractors has implications for costs and operational flexibility.

• Economic: Fluctuating fuel prices, inflationary pressures, and exchange rate variations directly affect Uber’s pricing models and profitability. Additionally, post-pandemic economic recovery influences demand for mobility services.

• Social: Growing urbanisation, changing attitudes towards car ownership, and increased preference for on-demand services support Uber’s business model. However, public perceptions about driver welfare and surge pricing can impact brand image.

• Technological: Advancements in GPS, AI algorithms for dynamic pricing, and autonomous vehicle technology present both opportunities and risks. Uber’s investment in AI and mapping enhances operational efficiency.

• Environmental: Rising concern about carbon emissions has prompted Uber to commit to becoming a zero-emissions platform by 2040. Regulatory pressure for electric vehicle adoption is increasing.

• Legal: Labour laws, competition regulations, and consumer protection statutes affect Uber’s operations in all markets.

For the competitive environment, Porter’s Five Forces analysis offers further insights:

1. Threat of New Entrants – Moderate, as app-based mobility services require significant capital, technology, and brand trust, but local competitors can emerge quickly.

2. Bargaining Power of Suppliers – High, since drivers can switch to rival platforms like Lyft, Bolt, or Didi with minimal cost.

3. Bargaining Power of Buyers – High, as customers can easily switch apps for better pricing or promotions.

4. Threat of Substitutes – Moderate to high, including public transport, cycling, and walking, especially in urban centres.

5. Industry Rivalry – Intense, with aggressive competition on price, promotions, and service innovation.

This external analysis highlights a complex but opportunity-rich environment where regulatory adaptation, technology adoption, and brand trust are critical to success.

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