Group: Titena Tiku, Jose Cruz

12 December 2023

Chapter One

Prof, Vivian Hatziyannis

Chapter Summary

In the realm of production and operations management (OM), critical concepts shape the

landscape of industrial and service sectors. Production involves the transformation of inputs into

outputs, while OM oversees the efficient production of goods and services. The supply chain

encompasses the entire process from production to customer delivery. The ten strategic OM

decisions encompass design, quality management, capacity planning, location strategy, layout

strategy, human resources, supply chain management, inventory, scheduling, and maintenance.

Services, integral to the service sector, denote intangible offerings. Productivity, a key metric,

measures output efficiency, with single-factor productivity focusing on one input and multifactor

productivity considering multiple inputs. Productivity variables include technology and

workforce skills. The knowledge society emphasizes the importance of knowledge in societal

progress, and Industry 4.0 signifies the integration of digital technologies in manufacturing.

Stakeholders, including employees and customers, play pivotal roles in organizational success.

Collectively, these terms elucidate the multifaceted aspects of modern production, from strategic

decisions to societal impacts.

The core functions of all organizations—operations, marketing, and finance/accounting—are

crucial for their success. Operations, responsible for creating goods and services, have seen

significant advancements in the twentieth century. Throughout history, humans have consistently

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sought ways to enhance material well-being, with operations managers playing a pivotal role in

improving productivity.

As societies grow more affluent, there is a notable shift towards dedicating resources to the

service sector, employing over 85% of the U.S. workforce. Achieving productivity

improvements and ensuring environmental sustainability present considerable challenges, but

operations managers serve as key drivers in the pursuit of these goals. Their role is integral in

fostering progress, especially as the demand for services continues to rise.

Case Study Summary

Uber Technologies, Inc., a $100 billion firm, has revolutionized the traditional taxi industry

worldwide. With its innovative business model, Uber has disrupted the traditional taxi model in

over 84 countries and 900 cities. The company utilizes smartphone apps to connect riders with

nearby drivers, offering a more convenient and efficient alternative to traditional taxis.

Uber's rapid growth and popularity have caught the attention of both the public and industry

giants worldwide. The company has captured a significant market share and is challenging the

dominance of traditional taxi services. The success of Uber can be attributed to its user-friendly

interface, reliable transportation options, and competitive pricing.

The conventional taxi industry has faced significant challenges due to Uber's presence.

Traditional taxi operators have raised concerns about the impact of this disruptive business

model on their livelihoods. They have argued that Uber operates without proper regulations,

putting passengers and drivers at risk.

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 However, Uber has countered these claims by emphasizing its commitment to safety. The

company has implemented various measures, such as background checks and rating systems, to

ensure the safety of both riders and drivers. Uber has also argued that its model promotes

competition and allows for more choice within the transportation industry.

As Uber continues to disrupt the traditional taxi industry, regulators worldwide have been

grappling with how to regulate this new form of transportation. Some jurisdictions have imposed

stricter regulations on Uber, while others have embraced it. The ongoing debate highlights the

complexities and uncertainties surrounding the emergence of disruptive technologies such as

Uber.

Despite the challenges it faces, Uber has shown remarkable resilience and ability to adapt to

new markets. The company's expansion into new markets is a testament to its ability to adapt and

meet the needs of consumers worldwide. Uber's success has also inspired the emergence of

similar ride-hailing apps, further challenging the traditional taxi industry.

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By leveraging technology, Uber and its immediate competitors have managed to add

significant efficiency to our society. They impacted our society by revolutionizing the

transportation industry. Their ability to provide enhanced mobility, save time, reduce costs,

reduce traffic congestion, and create employment opportunities has contributed to a more

efficient and interconnected society. As technology continues to improve, Uber's impact on

efficiency will likely grow, revolutionizing how we travel and live.

Uber's model is already implemented in the trucking industry. “Uber is now a player in this

market with Uber Freight. Uber Freight launched in 2017, and the program has since expanded

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to 48 U.S. states, as well as the Netherlands and Germany. Uber says thousands of shippers and

almost half a million truck drivers currently use the platform.”(CNBC). Uber Freight connects

shippers with truck drivers, aiming to streamline the freight logistics process. The success of the

Uber model in the trucking industry depends on various factors, and it has both potential benefits

and challenges. Some potential benefits are efficiency and optimization, real-time tracking, and

flexibility. Even though Uber Freight is implemented in the trucking industry it also has its

challenges which are regulatory hurdles, market penetration, driver shortage, security and

liability concerns, and market dynamics. The ultimate success will be determined by how well

the model addresses the unique challenges and opportunities within the trucking industry.

Another industry that can benefit from the Uber business model is the beauty and personal

care industry. The Uber model is about efficiency and convenience. Currently, in the beauty and

personal care industry, you have to go to a salon, or spa if you want to be treated. However, if the

beauty and personal care industry used the Uber model and brought their services to their

consumers the industry could really boom a lot more than it already has. I am picturing barbers

that come to your house for haircuts and masseuses come to your house for massages. This can

all be scheduled through an app similar to Uber.

There are a couple of disadvantages to the Uber model. The convenience of the Uber model

goes hand and hand with the technological advancements of Uber as a software company. This

means that consumers are prone to software attacks. Another disadvantage to this has to do with

the drivers. The price of rides depends on the available drivers and since Uber does not schedule

drivers, the supply of drivers can go up and down at any time meaning the prices of rides

fluctuate as well.

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Reference

1. https://www.cnbc.com/2019/09/14/uber-freight-makes-trucking-more-efficient-could-aid-
profit.html
2. https://plus.pearson.com/courses/urn:xl-hed:course:7469503/products/BRNT-2S1GB8FU
YHT/pages/737c4c00-6e44-11ec-9589-1f3fc4cb79eb?locale=&key=3066273222044577
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