Reference no: EM133114156

Uber's Case Assignment

Case Background:

1. One of the biggest vulnerability embedded in the default and alternative strategies is that it's hard for Uber to make profits and generate cash flows, which will be financial failures. In the current market, such as the US market, Uber needs to give the incentives to realize drivers' retention or users' retention, instead of losing its market share to its competitors such as Lyft. In the new entry market, Uber needs to market its brand to get new users by promotion activities, such as referral plans, which will increase the marketing expense. In addition, although incorporating more electric vehicles is an environmentally friendly strategy, such investment will cause pressure to Uber's profitability.

2. When Uber aims to transform into a comprehensive lifestyle platform, it is likely to have some merger and acquisitions activities. For example, Uber completed its acquisition of Postmates in a $2.65 billion all-stock transaction in 2020. These brought some direct advantages, such as solidifying Uber as the second-largest food delivery provider in the U.S. There are also some vulnerabilities to bring possible strategic failures. Uber and Postmates will gradually combine delivery and merchant networks, which may need great efforts but get an undesired outcome.

Instruction here:Describe a hypothetical root cause for each potential vulnerability

1. Hypothetical root causefor potential vulnerability- financial failures:

2. Hypothetical root cause for potential vulnerability- strategic failures: