Uber: Changing the Way the World Moves

Youngme   Moon

Case | HBS Case Collection | November 2015 (Revised January 2017)

Uber: Changing the Way the World Moves

Abstract

In 2015, Uber is building what may be the largest point-to-point transportation network of its kind; it is literally changing the way the world moves. But unlike traditional transportation logistics companies like FedEx, Uber has an incredibly lightweight infrastructure: it owns no vehicles, employs no drivers, and pays no vehicle maintenance costs. Instead, its network relies on peer-to-peer coordination between drivers and passengers, enabled by sophisticated software and a clever reputation system. But despite its remarkable early success, Uber is an extremely polarizing company. Its business model is highly disruptive, and while disruptive innovation can be a good thing, it is also true that disruptive companies tend to break things. This is certainly true for Uber and is one of the key tensions in the case: Uber's innovative business model is outpacing many of the laws regulating its industry, and while it is going to take the regulatory system some time to catch up, Uber doesn't appear to be willing to wait.

Keywords: marketing; operations; service; strategy; innovation; disruption; pricing; customer loyalty; customer satisfaction; Uber; taxi; transportation; sharing economy; on-demand economy; consumer behavior; Marketing; Operations; Strategy; Disruption; Customer Satisfaction; Transportation; Consumer Behavior;