Uber raises fundamental questions for organizational design. What is the appropriate shape for an app-driven matchmaker between car owners and those who might share their automobile? What is the relationship among corporate HQ, the drivers, and the riders?
Mattia Santin, Head of Media Marketing – EMEA, Uber discuss organizational challenges for a new economy company. Mobile computing, the so-called Internet of Things, and the rapid expansion of Internet connectivity all over the world are combining to challenge long-standing assumptions about the mission, function, and reach of traditional organizational forms. Uber is a fast-growing company with several unique attributes: its drivers are not employees, the company does not own the majority of its productive infrastructure, and the management is often at odds with local law and custom. Uber’s rapid rise to unprecedented scale serves to illustrate the gaps between traditional organizational assumptions and the reach of current technological capability. Unlike a traditional seller of products or services, Uber serves as an intermediary between two different markets: riders and drivers (who own cars). In this position, Uber requires minimal capital and takes a cut of every transaction facilitated by its smartphone app. Two-sided platforms have the property of being able to scale extremely well through a flywheel-like virtuous circle: more riders attract more drivers, which attract more riders, which attract more drivers, etc.