Disruptive Change in Taxi Business †Free Samples to Students

Question: Discuss about the Disruptive Change in Taxi Business. Answer: Introduction In todays competitive business world, corporations are facing fierce competition, and they focus on fulfilling their Corporate Social Responsibilities (CSR) by implementing appropriate policies and by taking ethical business decisions (Carroll and Shabana, 2010). The purpose of this report is to analyse ethical issues in the transportation industry by analysing the actions of Uber Technologies Incorporation. Uber is a transportation network company which offers services such as peer-to-peer ridesharing, taxi service, food delivery and others. This report will evaluate how unethical actions of Uber have affected different stakeholders in the transportation industry. Major alternatives will be discussed in the report for addressing the ethical issues. Further, the report will select a preferred alternative by justifying why it is the best option. Uber Technologies Incorporation was founded in 2009 as a mobile application which enables customers to book taxi drivers directly from the phone application. The company operates in transportation and delivery industry and offer services to customers around the globe. The corporation has employed more than 12 thousand employees, and its head office is situated in San Francisco, California, US (Bhuiyan, 2017). However, from its beginning, the company has been under different controversies. For example, recently a self-driving car of Uber was involved in an accident which resulted in the death of a woman (Levin and Wong, 2018). Similarly, a Delete Uber campaign went viral on social media after the company lifted surge pricing on its service in New York (Cresci, 2017). The key ethical issue with Uber is that it gained a competitive advantage in transportation industry due to ease of use which resulted in negatively affecting taxi drivers. The key stakeholders who were affected by the po pularity of Uber are taxi drivers, competitors and public. Public and competitors are affected because Uber has a dominating position in the transportation industry and it increases charges or introduces surge pricing without caring about its impact. Popularity of Uber resulted in reducing the income of taxi drivers, and many of them lose their jobs. With the popularity of Uber, it has become difficult for taxi driver to get customers, and they are struggling to earn a living (Cramer and Krueger, 2016). The company has gained a bad reputation in the transportation industry due to a number of scandals. For example, in 2014, the company faced accusations for targeting its competitors by booking face rides in order to cut their profits (Li, 2014). This incident shows that the company is using illegal methods to generate a competitive advantage in the industry. In 2016, more than eight thousand drivers strike against the company with demands for providing a minimum wage to its drivers (Booth, 2016). With the growing number of Uber drivers, it has become difficult for them to earn a decent living. The corporation is dominating the transportation market in such a way that drivers have no option but to join Uber. The firm is misusing its monopoly to dominate and force taxi drivers to join. This raises serious ethical questions against the actions of the enterprise. Moreover, the company is also investing heavily in self-driving vehicle technology by entering into a business deal with Swedi sh carmaker, Volvo. It is planning to introduce 24,000 self-driving cars by 2021 to dominate taxi industry due to which taxi drivers can lose their jobs (Pollard and Somerville, 2017). Alternatives for Addressing Ethical Issues The company has been in controversies because millions of taxi drivers lose their jobs after the introduction of its services. The company has maintained a dominating position in the transportation industry, and it implements policies with assessing its future impact on different stakeholders (Rogers, 2015). The stakeholders who are affected by the unethical behaviour of Uber include public, taxi drivers and Ubers competitors. Following are different alternative solutions that can be implemented by Uber for addressing the ethical issues. The key ethical issue faced by the company is unemployment of taxi drivers and loss of their income. In order to address this issue, the company can work with local authorities to provide employment to the local drivers. The company can hire or provide other employment to taxi drivers in order to ensure that they are able to earn a living. The corporation should also provide a minimum wage to its drivers around the world to ensure that they are able to earn a decent living (Edelman and Geradin, 2015). The company should also hire employees as a human backup for self-driving vehicles which will reduce the risk of unemployment and accidents. Another alternative is that the company can set a limit for its driver in different cities to ensure that taxi driver is also able to earn a living. It will reduce the dominating position of the company in the market and benefit the drivers who earn a living by driving taxi and who are not able to join Uber. The corporation can collaborate with its competitors to equally divide the number of driver with each other in order to ensure that they are not able to use their monopoly for implementing policies that are not suitable for public and its competitors. Collaboration with competitors will allow the company to provide better services to taxi drivers and provide them the option to increase their income. Preferred Alternative The first option is the preferred alternative for addressing the ethical issues faced by the company. By implementing this alternative, the company will be able to ensure that taxi drivers are able to earn a living by driving taxi for Uber. It will also increase the profits of the company and their market share as its number of drivers grows. By working with local authorities, the corporation will be able to set a minimum wage for its drivers to ensure that they are able to earn a decent living. Hiring employees as a human backup for self-driving cars is also a good option for reducing accidents. It will also reduce the unemployment rate in different countries. Therefore, this is the preferred alternative for addressing the ethical issue faced by Uber. Conclusion In conclusion, Uber has used innovative technology to capture and dominate the transportation sector. Due to ease of use, the firm is able to provide its services across the globe. The company is facing ethical issue because its popularity negatively affects taxi drivers who earn their living by driving taxi. Popularity of the corporations services result in reducing the income generated by taxi drivers, and it increased the unemployment rate. The company is also introducing self-driving vehicles which will result in increasing unemployment rate of drivers. These issues affect different stakeholders including public, taxi drivers, and Ubers competitors. There are different alternatives discussed above that can be used by the enterprise to address its ethical issues. The preferred alternative is hiring of taxi drivers who are not able to generate a decent living by working with local authorities. Recommendations Following recommendations can address the ethical issues face by the firm and sustain their future growth. Uber should analyse how its business decision influence different stakeholders. Executives should take business decisions after evaluating its impact on stakeholders to avoid unethical behaviour. Uber should introduce new CSR policies to ensure that actions taken by executives are ethical and for the development of society. It should invest in services and technologies for sustaining the growth and development of stakeholders who are affected by its actions. References Bhuiyan, J. (2017) Uber has published its much sought after diversity numbers for the first time. [Online] Recode. Available at: https://www.recode.net/2017/3/28/15087184/uber-diversity-numbers-first-three-million [Accessed 23 March 2018]. Booth, R. (2016) Uber drivers stage go-slow protest through central London. [Online] The Guardian. Available at: https://www.theguardian.com/technology/2016/nov/22/uber-drivers-go-slow-protest-central-london-minimum-wage-guarantee [Accessed 23 March 2018]. Carroll, A.B. and Shabana, K.M. (2010) The business case for corporate social responsibility: A review of concepts, research and practice.International journal of management reviews,12(1), pp.85-105. Cramer, J. and Krueger, A.B. (2016) Disruptive change in the taxi business: The case of Uber.American Economic Review,106(5), pp.177-82. Cresci, E. (2017) #DeleteUber: how social media turned on Uber. [Online] The Guardian. Available at: https://www.theguardian.com/technology/2017/jan/30/deleteuber-how-social-media-turned-on-uber [Accessed 23 March 2018]. Edelman, B.G. and Geradin, D. (2015) Efficiencies and regulatory shortcuts: How should we regulate companies like Airbnb and Uber.Stan. Tech. L. Rev.,19, p.293. Levin, S. and Wong, J.C. (2018) Self-driving Uber kills Arizona woman in first fatal crash involving pedestrian. [Online] The Guardian. Available at: https://www.theguardian.com/technology/2018/mar/19/uber-self-driving-car-kills-woman-arizona-tempe [Accessed 23 March 2018]. Li, S. (2014) Uber Accused of Booking Thousands of Fake Rides to Mess with Rival Lyft. [Online] The Atlantic. Available at: https://www.theatlantic.com/technology/archive/2014/08/uber-accused-of-booking-thousands-of-fake-rides-with-rival-lyft/375936/ [Accessed 23 March 2018]. Pollard, N. and Somerville, H. (2017) Volvo Cars to supply Uber with up to 24,000 self-driving cars. [Online] Reuters. Available at: https://www.reuters.com/article/us-volvocars-uber/volvo-cars-to-supply-uber-with-up-to-24000-self-driving-cars-idUSKBN1DK1NH [Accessed 23 March 2018]. Rogers, B. (2015) The social costs of Uber.U. Chi. L. Rev. Dialogue,82, p.85.