Let’s get cracking…
…by reading back over the content on planning in Chapter 4 of the textbook. Once you’re done, you should have a pretty good understanding of the various tools and processes available to you for planning. Now let’s see how well it works when others plan.
Summarising very briefly:
With rising awareness of global wealth inequality, with the richest 20% in Australia earning five times as much as the poorest 20%, and with the US experiencing an even worse gap, this inequality is now a recognised problem. Evidence suggests that wealth and income inequality are dangerous for economic stability and prosperity, and if you get a chance to view this entertaining and informative documentary, you will get a good idea of how the two are linked.
Recently, the OECD published a report exampling how reducing wealth inequality benefits everyone. In the same spirit, the International Monetary Fund published a game-changing report about two years ago, saying that increasing the income share of the poor and the middle class actually increases economic growth, and that increasing the income share of the top 20% results in lower growth. While economic growth may not be the best thing anyway, wealth inequality is worth tackling because of its many other negative effects.
One way to reduce inequality is resorting to sharing economies. You would have been part of some form of sharing economy, where you became aware of available resources which you could use: sharing money to fund projects you believe in through crowdfunding websites, booking accommodation through AirBnB, and maybe sharing transportation with Lyft or Uber.
Trip-sharing sounds like a win-win-win: the driver gets someone to chip in for the trip, the passenger gets a ride that is cheaper than a taxi and the planet gets less carbon emissions. But of course, things are more complex than they seem. There have been many criticisms of Uber’s model, including the conditions of the drivers compared to traditional taxi drivers and the uncertainty around passengers’ safety. Still, Uber is growing in popularity and even has competition, so the company must be onto a good thing.
Uber has recently expanded its model from transportation of passengers into food deliver, with UberEats, and now plan to expand to the UK. Despite existing competition of companies like Deliveroo, Uber is recruiting bicycle and moped drivers, partners with restaurants, and gets ready to move in.
Deliveroo could get nervous about the upcoming competitions, but instead, their CEO explains that they focus on restaurants and motorcycle and have no problem with other companies looking at other niches.
One thing is certain: competition is a certainty in any business, and uncertainty is a constant. Planning in these conditions is very challenging and may require a Chrystal ball...
Consider the following questions for discussion…
- From the post, what types of planning is Uber engaging in at this stage? What about Deliveroo? What type of planning would you recommend for them?
- From the post, what goals can you identify? Which are the stated goals and which are the real goals? Based on what can you tell them apart?
- What elements of strategic planning are evident in the article? What elements are missing? How would you, as strategic manager in Uber or Deliveroo, use these missing elements?