What Can Your Business Learn From Uber’s Successful Use of Technology?

At a tradeshow event last month Travis Kalanick, co-founder and CEO of Uber, was interviewed about the future of Uber and transportation. He replied with a bold vision that speaks to how much technology has the potential to change things. According to Kalanick, “Every car should be Uber.”

For the uninitiated, Uber is a technologies company which provides services for taxis and for-hire vehicles by allowing passengers to request trips to the closest for-hire Uber driver, through its mobile app. Uber’s ride-hailing technology is revolutionizing the transportation industry by allowing anybody with a car, a smartphone, and a clean driving record to earn extra income by becoming an Uber driver. Additionally, Uber has streamlined the whole payment system so that its transactions are taken care of through the app and drivers don’t have to handle cash.

Since its founding in 2009, Uber has grown tremendously. In 2012 Uber expanded to international markets, in 2013 USA Today named Uber “Tech Company of the Year,” and today the company is valued at $50 billion.

What’s the secret to Uber’s success? It’s not so much that they’re offering a new service. In fact, ride hailing services like the rickshaw predate taxi cabs and gasoline engines. Instead, Uber’s advantage comes from adopting new mobile technology that prioritizes in the ease-of-use for consumers. Every business should learn from Uber’s utilization of technology because too often organizations choose to invest in old practices that have always worked, instead of cutting-edge technology initiatives.

The way Kalanick sees things, if every car on the road was a part of the Uber network, then more people would opt to use the service instead of owning a car. Think for a moment about the implications of hailing a ride with an Uber car being more efficient and cheaper than owning and maintaining your own vehicle. Essentially, everywhere in the world where “every car is Uber” would eliminate traffic jams caused by too many cars on the road. Kalanick explains:

If every car in San Francisco was Ubered there would be no traffic. If everyone in the city took an Uber instead, it would give back an hour of time every day to every person. What would you do with that time? You could give it back to your family.

Kalanick used San Francisco as a prime example of this vision because that’s where Uber is headquartered, and it’s one of the worst cities in the country in terms of time lost due to being stuck in traffic--78 hours lost per year for every San Francisco commuter, according to a recent traffic study by Texas A&M University. If Kalanick has his way and “ubered” every car in the Bay Area, that would equate to thousands of workers getting back almost two whole work weeks each year. This benefit should excite every commuter who’s ever felt helpless and frustrated from being stuck behind an endless line of slow-moving cars.

Uber is already working to make this every-car-an-Uber-car future a reality. Uber understands that there has to be more involved than simply having a bunch of their cars on the road; they also need to make their ride-hailing service as efficient as possible. Otherwise, Uber drivers will compete with each other for the same fares while other high-need spots go neglected. InformationWeek explains how Uber hopes to solve this by developing new technology:

How does Uber plan to reduce the cost of transportation? Mostly by predicting demand. The cost of transportation comes in the downtime. If a driver has to spend 15 minutes traveling to pick up a fare, that's 15 minutes the driver isn't making any money. Uber is investing in predicting demand so it can move drivers to points of demand before that demand even occurs. He described heat maps for drivers that allowed them to move to areas of high demand so cars could "[remove] the heat out of the area."

The idea here is to minimize driver downtime, which will decrease the cost of fares. Of course, in order for “every car to be ubered,” the fares will have to be cheap enough to be affordable for riders, and yet profitable enough that drivers will find Uber to be worth their time. When leveraged correctly, technology has the ability to bridge this gap by helping business owners better understand supply and demand.

What about your business? How are you taking advantage of the latest solutions and mobile technologies in order to shake up your market and “reinvent the wheel?” In order to achieve this, you’re going to want a technology expert in the passenger seat that understands the intricacies of cutting-edge technology, as well as the specific needs of your business. Ferrum Technology Services can provide you with the solutions that you need to succeed. Call us at (847) 697-3282 for a consultation to learn what technology can do for you!