Wednesday, November 25, 2015

Blue Ocean Strategy – Wide Open Spaces

After reading “Blue Ocean Strategy” written by W. Chan Kim and Renee Mauborgne, I’ve come to the conclusion that most companies that alter the norm can be very successful in the end, given the reduced amount of competition.  While reading, the first company that shot into my brain was Uber.  Uber took an unattractive market place and quickly took the lead in the public transportation industry.  Their strategy was very different than their competitors and their success in the marketplace proves that the blue ocean idea worked in their favor.  Rather than standing on the corner with your arm up to flag a taxi, all you need to do now is request a ride from your cell phone.  There is no longer an unknown variable in regards to when you will be picked up.  While I was in New York, flagging a yellow cab could take 30 seconds or upwards of 10 minutes during peak travel times.  Now with Uber, I can sit in my office and request a ride and know shortly thereafter when and where my car will be.  The convenience alone sets this company apart – especially thinking about waiting for a ride during a harsh winter storm.  I no longer have to bundle up and fight with the elements while waiting to be picked up.  I can have a car meet me right outside my office, on time, with little to no effort at all!

They also set the standards in regards to their actual vehicles.  In fact, Uber doesn’t own a single vehicle and relies on their drivers to use their own cars.  The cars are all new and look/feel much cleaner than your standard yellow cab.  This reduces their overhead and also increases their profit gap because they don’t have to worry about things like vehicle maintenance and gas prices.  Having a fleet of multiple different types of vehicles also attracts some riders (me for instance).  I enjoy taking Uber’s, more now than ever, because I am currently in the market to purchase a new car.  My commute home is two miles and typically runs me $5-$7 dollars when I decide to take an Uber.  I also get to test drive cars from the back seat without having to take additional time to visit specific dealerships to do the same.

Lastly, Uber conducts background checks and other crucial research before hiring their drivers.  I’ve experiences 100+ Uber rides in the past 2 years and have never had a bad experience.  All of the drivers seem to have the best interest in getting you to your destination in a timely fashion and worry about your safety.  They always apologize for traffic errors, even though most of the time it’s not even their fault.  As soon as you hop into their vehicle, they ask how your day has been and then ask what radio station you’d like to listen to.  If you spark a conversation, all drivers are happy to chime in and discuss anything/everything with you.  It’s almost like you gain a friend each and every time you hop into a car with a “U” in the window.

I’m excited to see what Uber does in the future and really think they are a front-runner in regards to a Blue Ocean company.  It’s safe to say that I agree with their business model and think they are going to be very successful in the coming future.  Given today is a Holiday at the office and we are getting out a few hours early, I’ll be sitting in a warm, comfortable Uber car for my short commute home this afternoon.

Happy Thanksgiving!

Nathan Kotecki

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