It is the 3. and last milestone.
I’ll update one milestone and guidline as attachment.
We are talking about a new service of a company not existing service.
How the government can take legal action against this new service.
Lyft Delivery is basically like Uber eats
1
Government Action On Lyft Inc. Delivery Service Business
Government Action On Lyft Inc. Delivery Service Business
Lyft Delivery is an app that allows users to order food with Lyft website and Lyft app. It is very simple and quick to use, and you can give your order online without having to call anyone from restaurant where you want to give your order. With this application you can see the customer reviews and restaurant’s special offers. This will make it easier to decide for the customers what they want to order and will provide more sale for restaurants. Also, with this application you can order your food in a safe way. You do not have to give your credit card information the restaurants. At the same time, with the background check for drives will also provide a more reliable service.
Target Market: Basic Demographics
A study was conducted by Statista in 2018 on the online food industry. According this research in 2018 54.9% of people who ordered food were men and 45.1 were women and food orders was given mostly by people between the ages of 25 and 34. The 25-34 age range constitutes 37.1% of the total users. This ages group is been following by 35-44 age groups with %25.9. Also, in a study based on users’ income level, high income users constitute %43.13 of total users (Statista,2018). For more information you can view tables on the below.
The company aims to reach all the Americans who order food from restaurants or various platforms regardless of gender difference or income level. As Lyft Delivery we would like give service from all people who live in this country.
Psychographic characteristics of target market
Time is money! This quote is known by all most all people around the world. People are giving up cook at home because the cost of cooking at home cost more than order from outside. Working or resting are much more profitable than cook at home. “Is the Kitchen Dead” named report was shared by investment bank UBS in 2018. “There could be a scenario where by 2030 most meals currently cooked at home are instead ordered online and delivered from either restaurants or central kitchens.” (UBS,2018). That’s a small part of their report. According to their report, people, especially millennials, are giving up cook at home. Also, people texting each other instead of calling by phone. Therefore, ordering by phone is not something that people like. People want to give order without have to call restaurant. As Lyft family, we hope to give this service to our 23 million active users with 1.4 million drivers.
According to Statista 85.4 million people in the United States ordered food in 2018. Of the 85.4 people, 66.3 million ordered food directly from the restaurant, while 19.1 ordered through various platforms such as UberEats, Doordash and Grubhub. When we look at the population of the 325 million Americans, 85.4 is a very serious figure. This means that one out of every four people in the United States ordered food in 2018. Also 26.2 million Americans are expected to give order with various platforms in 2023. And the expected revenue per user is $ 113.62 and estimated expected total revenue is 2.980 billion (Statista,2018). In the tables below, you can see more information about the number of users and estimated revenue per years.
Strengths and Weaknesses
SWOT analysis allows you to see your strengths and weaknesses in the areas related to your business, and to prepare you for the opportunities and dangers that are waiting for you in the future. As Lyft company, we have some advantages and disadvantages regarding of our new service. In this discussion, I will analyze the weaknesses and strengths of the company and the opportunities and dangers that await us in the market.
You can see our Swot analysis template on the below about our company’s new product about Lyft Delivery.
Helpful
to achieving the objective
Harmful
to achieving the objective
Internal origin
(attributes of the system)
Strengths
· Low cost
· Accessibility
· Flexible hours for drivers
· Fast delivery
· well-recognized brand
· High level of customer satisfaction
· High growth
Weaknesses
· Driver’ Loyalty
· Drivers’ wrong attitude
· Ethically questionable
· Only through the app
External origin
(attributes of the environment)
Opportunities
· Learn from other market players’ mistakes to innovate
· The desire of people to be more independent
· Technology
· Electric vehicles
Threats
· Competitive food delivery industry
· Legal threat
· Artificial intelligence
· Economic recession
Governmental Action
When Uber started serving in 2011, it faced many problems. Taxi lobby is at the very beginning of these. Ubereats faced fewer problems. Ubereats’ biggest problem is the high commission fees. The fee of commission paid to restaurants is between 20% and 30%. The restaurants that run their own drivers and have to pay a fee for this driver are getting less efficient than before with the increase in the market of delivery companies. Restaurants paying high commission fees are very complaining from this situation. So recently, New York City hold its first-ever oversight hearing for third-party food delivery apps and the effect they have on local restaurants (The Spoon,2019). The purpose of the meeting is to protect local restaurants from increased competition increase in the market of delivery companies. Companies have to reflect high commissions in order to realize their activities. It is difficult to make both the customer, the restaurant and the drivers happy in the same sense. The restaurants, which try to be protected from high commission fees, increase their prices on the application by 20% of the general level. Increasing the prices pushes customers to pick-up or call restaurants directly. In this case, the drivers who are online to make money do not receive any calls. Drivers who earn a price per order sometimes sit in the car emptily for hours. For this reason, a potential government enforcement may occur regarding commission fees.
Another problem of the sector is the uncertainty of the Gig economy. In April of 2018, the California Supreme Court issued the Dynamex decision, which said all employers must presume workers are employees instead of independent contractors. (Fortune, 2019). But companies did not like it. Because If the driver cannot take any passengers during the time he is online, Lyft is not obliged to pay any price to this driver. The situation is not just that. When a driver who works 50-60 hours a week has illness, there is no charge for Lyft when he does not work. At the same time, employees are not provided with insurance. For such reasons, 2020 will be troubled for Rideshare companies.
Organization and Teams
Management has changed with changing management environment in the digital world (O’Reilly, 2016). New management will encompass board of directors that include the chief executive officer, the president who is also the vice chairperson of the board, executive vice president who also serves as the product officer, chief finance officer and a general counsel who is also the secretary. The board also include other seven members including the chairperson and six directors who act as advisors on management matters. The executive and the board of directors have been involved in deliberating all government action in the past. Any issues that require organizational level decision has been subject to debate and advise by the executive in conjunction with the board of directors.
The chief finance officer heads the finance department. The finance department has the accounting section, investors relations fraud and payments section. Finance department deals with the organizations finance issues by handling finance transaction upon approve by the management. Finance division has played important role in income declaration, submission of tax and payment of any funds required under the government regulations.
Human resource divisions focus on managing labor regulation and propose changes on the outdated labor restrictions (Atmore, 2017). The autonomous safety and compliance team ensures that the organizations and employees comply to human resource policies and worker safety. Healthcare deals with issues relating to health facing the employees. It ensures that healthy working environment is present as per the legal requirements of the government regulations. Policies department entails formulation of business policies for effective business operation. Policy division works towards development of policies that ensure compliance with the government action. Policies guide business action thus designing policies has to be in accord with the required legal business operation practices.
The chief technology officer leads a team of technology experts that work for the technological development of the Lyft Inc. deliveries business. The autonomous driving and engineering teams works in ensuring that development of the Lyft Inc. deliveries applications and automated delivery technology which is in accord to the legal provisions. Focusing on the legal payment modes and the legal access of the apps will enable the business to comply with the technological requirements by the government. The technology team will also ensure that the technology used is licensed by the government for its use in the business operation.
Products team manages the types of services offered by the business organization. Product management involves establishing products each and every time chances are open. Some of the products include self-driving, autonomous driving and fleet technologies. Products and services are subject to government regulations. The products team has ensured that the services the business avails to customers are healthy and physically safe for their lives. By complying to the provision of legal and regulated product, this team has to ensure the services are viable to government actions.
The legal representation divisions provide the legal services and advice to the business. The team has to represent the business in petitions and cases that regard regulations such as high tax and restrictions. This is the team that stands to defend the business against the government actions that pose potential threats to business continuity.
Communication and public relations team links the stakeholders to the business. They also link the community to the business. This team has to dealt with issues of government restriction of the business due to criminal cases against similar companies. Public relation teams have the role of convincing and creating positive relation with community thus preventing a negative corporate culture. The team will ensure that the image of the organization is positive to avoid government sanctions due to negative corporate culture.
Customer experience and trust team ensures that customer treatment is good. The team also handles customer complaints and request for service improvements (Jacquet, 2018). This team will enable the business to maneuver cases of government regulations on delivery of food. The team has to create a positive relationship with customers and the community where the community can go against government interests on regulating delivery of food and goods to people in their residential settings. The team has to therefore deal with government action by using the community as a tool to repel the regulations.
Stakeholders
Internal investors include management board, employees and investors. The management board have responded to the action by consulting the company that can provide guidance on the way forward in dealing with the government action. Employees are also subject to dealing with the government actions as the most affected by the regulation. The employees have played their part in influencing the government action by mobilizing the community to show their interests against the proposed regulation. They have also helped in consultation on how to provide better ways of addressing the concerns targeted by the government action.
Investors are the most important internal stakeholders in the business. Investors have also shown great interest by using lobbying where they have engaged in convincing public and the government to leave aside such regulations as it might have negative effect on the business (Keller, 2018). Lobbying is political action and can work in convincing majority to turn against the proposed government actions.
External stakeholders include the business partners, customers and the community. Business partners are the close associates allied to the business. Their roles in addressing the govern action have been focused on providing information and consulting expert government officials on the action proposed (Gunningham & Sinclair, 2017). Consultations gives information on the way forward and possible strengths and weaknesses of the regulation. Business partners create good corporate culture and thus their influence on government action is high compared to other stakeholders.
Customers are the important stakeholders that are targeted by the regulations. Customer have engaged in demonstrations against regulations that have impact to them. For instance, hiking of tax necessitate delivery charges increase for the consumers. In this contexts, customers have engaged in demonstration and expression of dissatisfaction on regulation that affect them (Stubbs & Higgins, 2018). Through demonstration and expression of their interests, the interest of business is achievable
The community is a very large group of stakeholder with different community organizations. The community has influenced political process to suit business interests by engaging government policy making through public participation. Policies targeting business are subject to public opinion and in this way, the public community supports business interests through expressions of their opinions on public forums. Civil societies have also influenced political processes by identifying the negative impacts and challenges that may emanate from government actions. Regulations that threaten the economy and the business as a whole are subject to opposition by the community.
Current Environment
Lyft Inc. delivery is a new business that operate in a competitive business environment with more than four competitors offering similar service (Harris, 2017). Doordash, Uber Eats, Grubhub, Postmates and Instacart form the top competitors. Despite this fierce completions, Lyft Inc. delivery targets to manage and maintain a significant market share. The financial revenue is expected to have an increase with time as the business competition with others increases. Government actions may have also threaten the business environment resulting in dropping financial revenues. Also Lyft went public in 2019. The first day when they public the company raised 2.3 billion dollars. Initial stock price was 72$. But since the company’s IPO their stock price constantly decreased. Nowadays their stock is valued 36$ in Nasdaq.
References
· Marston J, (June,2019), Oversight Hearing for Third-Party Food Delivery in NYC Retrieved from https://thespoon.tech/what-to-expect-at-todays-oversight-hearing-for-third-party-food-delivery-in-nyc/
· Goodkind N, (Novomber, 2018, California gig economy, Retrieved from https://fortune.com/2019/11/08/california-gig-economy-bill-uber-lyft-ab5/
· Anonymous, Lyft business model Retrieved from https://jungleworks.com/how-lyft-works-business-model-insights-lyft-revenue/
· Anonymous (2018), Online food delivery analysis Retrieved from https://www.statista.com/outlook/374/109/online-food-delivery/united-states
· C.Smith (2018), Lyft Statistics, Retrieved from. https://expandedramblings.com/index.php/lyft-statistics/
· O’Reilly, T. (2016). Managing the bots that are managing the business. MIT Sloan Management Review, 58(1), 9.
· Atmore, E. C. (2017). Killing the goose that laid the golden egg: Outdated employment laws are destroying the gig economy. Minn. L. Rev., 102, 887.
· Jacquet, A. (2018). A power struggle in the taxi industry: a challenge for Uber and Lyft regarding their Service clauses. PM World Journal, 7(2).
· Keller, E. (2018). Noisy business politics: lobbying strategies and business influence after the financial crisis. Journal of European Public Policy, 25(3), 287-306.
· Gunningham, N., & Sinclair, D. (2017). Smart regulation. Regulatory theory: Foundations and applications, 133-148.
· Harris, B. (2017). Uber, lyft, and regulating the sharing economy. Seattle UL Rev., 41, 269.
MBA 665 Final Project Milestone Three Guidelines and Rubric
Overview: The final project for this course is the creation of an impact of governmental action on a business paper. For Milestone Three you will submit the
Analysis section of your final project, which is Section II of the critical elements. Your analysis should include answers to all the questions in the Analysis section
on business environment, sustainability, internal resources, communication, company image, response, impact, and external resources.
Specifically, the following critical elements must be addressed:
I. Analysis: After submitting your overview, your boss is having second thoughts about bringing Jack Harris and his firm, Crisis Consulting, on board. Before
he makes his final decision he has asked you to provide him with a thorough analysis of the situation faced by your business. He asks you to prepare a
memorandum to him (the CEO) analyzing the situation that your business faces as well as the resources that are available to it. Address the following:
A. Business Environment: Based on your analysis of the governmental action or political challenge, what will be the impact of the governmental
action or political challenge on the business’s financial situation and operations? Does the action represent an opportunity or a threat?
B. Sustainability: Based on your analysis of the governmental action or political challenge, how will the governmental action or political challenge
impact the sustainability of the business?
C. Internal Resources: Evaluate the internal resources of the company, including the business project teams that are available to respond to the
opportunity or threat. In other words, is the business adequately organized to address the opportunity or threat?
D. Communication: How has information about the situation been communicated to various stakeholders? For example, have any public hearings
been held? Have the radio, newspapers, or social media been used?
E. Company Image: Assess how the situation has affected the company’s public image. Has the impact been primarily positive or negative? If the
impact has been primarily negative, what are the positive aspects in addition to the negative aspects? If the impact has been primarily positive,
what are the negative aspects in addition to the positive aspects?
F. Response: What are the potential courses of action to respond to the situation in the current macroeconomic and business environment? In
other words, what is the range of options for the business in this situation?
G. Impact: How will these courses of action impact the business? Make sure to consider both short- and long-term impacts, including operational,
financial, and ethical implications.
H. External Resources: Evaluate the roles and functions of third parties or external resources in the situation. Consider questions such as these in
your response: How will lobbyists be involved in the situation? Will there be public affairs professionals who will argue on behalf of the
government or the business?
Guidelines for Submission: Your paper must be submitted as an 8-10 page Microsoft Word document with double spacing, 12-point Times New Roman font, one-
inch margins, and sources cited in APA format.
Rubric
Critical Elements Proficient (100%) Needs Improvement (70%) Not Evident (0%) Value
Analysis: Business
Environment
Accurately determines impact of
governmental action or political
challenge on business finances and
operations, based on analysis of
action or challenge
Determines impact of
governmental action or political
challenge on business finances and
operations, but response lacks
detail or accuracy or is not based
on analysis
Does not determine impact of
governmental action or political
challenge on business finances and
operations
10
Analysis:
Sustainability
Accurately determines impact of
governmental action or political
challenge on sustainability of
business
Determines impact of
governmental action or political
challenge on sustainability of
business, but response lacks detail
or accuracy or is not based on
analysis
Does not determine impact of
governmental action or political
challenge on sustainability of
business
10
Analysis: Internal
Resources
Comprehensively evaluates
internal resources of company,
including business project teams
available to respond to opportunity
or threat
Evaluates internal resources of
company, including business
project teams available to respond
to opportunity or threat, but
evaluation is cursory or inaccurate
Does not evaluate internal
resources of company
10
Analysis:
Communication
Accurately assesses how
information about situation has
been communicated to
stakeholders
Assesses how information about
situation has been communicated
to stakeholders, but with gaps in
accuracy or detail
Does not assess how information
about situation has been
communicated to stakeholders
10
Analysis: Company
Image
Accurately assesses how situation
has affected company’s public
image
Assesses how situation has
affected company’s public image,
but with gaps in accuracy or detail
Does not assess how situation has
affected company’s public image
10
Analysis:
Response
Determines appropriate potential
courses of action for responding to
situation in current
macroeconomic and business
environment
Determines potential courses of
action for responding to situation
in current macroeconomic and
business environment, but not all
courses of action are appropriate
or response has gaps in accuracy or
detail
Does not determine potential
courses of action for responding to
situation in current
macroeconomic and business
environment
15
Analysis: Impact Accurately determines impact of
courses of action on business,
considering short- and long-term
operational, financial, and ethical
impacts
Determines impact of courses of
action on business, considering
short- and long-term operational,
financial, and ethical impacts, but
with gaps in accuracy or detail
Does not determine impact of
courses of action on business
15
Analysis: External
Resources
Comprehensively evaluates roles
and functions of third parties or
external resources in situation
Evaluates roles and functions of
third parties or external resources
in situation, but evaluation is
cursory or inaccurate
Does not evaluate roles and
functions of third parties or
external resources in situation
10
Articulation of
Response
Submission has no major errors
related to citations, grammar,
spelling, syntax, or organization
Submission has major errors
related to citations, grammar,
spelling, syntax, or organization
that negatively impact readability
and articulation of main ideas
Submission has critical errors
related to citations, grammar,
spelling, syntax, or organization
that prevent understanding of
ideas
10
Total 100%