Tech

Uber Drops Off Travis Kalanick

*photo provided by Time

 

On Tuesday, Travis Kalanick resigned from his position as C.E.O. of Uber Technologies. It was a move that was not exactly a surprise. The death of his mom, combined with criticism about his leadership of the ride-sharing company caused Kalanick to initially request a leave of absence. The initial leave of absence announcement softened the blow of his resignation. It has been reported that Kalanick will remain on Uber’s board with voting rights. And with reports of some employees petitioning his return to Uber as the C.E.O., the future of Uber’s leadership is unclear.

Regardless of Kalanick’s likelihood of returning, the company’s C.E.O. moving forward will need to pivot away from the current clouds that hover over the company. From surge pricing during social protests, to wide-spread sexual harassment claims within the company, all the way to Kalanick himself being involved in a heated exchange with an Uber driver, the company is in dire need of a step in a new direction. And now is a perfect time to take a look at ways to make that change.

All things being disclosed, I am an Uber driver. I’ve been driving close to three years and I have a driver rating that hovers around the 4.88 to 4.92 range. In that time period, I’ve done just under 3,500 trips. I can count on one hand the amount of complaints that I’ve received. And I have just under 80 positive compliments on my profile. So, I feel confident in speaking about the company and where it should focus its efforts moving forward.

Who is Uber focusing on and catering to?

Rate reductions and the Uber Pool option are both ways to attract more riders and provide a competitive advantage for Uber against rival ride-sharing companies. Kalanick often referred to affordability being a key component to reducing car usage and attracting lower-income riders. These fee reductions were supposed to reduce transportation deserts for lower-income riders who live further away in suburbs from the jobs they hold in major cities. Take a look at this image…

 

 

This image is a screenshot of my driver app for Uber. I drive in the Washington, D.C. area and this shot is a map of that region. The upper right-hand corner has a few numbers. The 37 refers to the number of trips I’ve done in this current week. The 39 represents the threshold that I have to reach to receive an incentive from Uber. Keep that pinned in your mind for later. The middle of the screen shows an area that has a red outline as its border. That area is essentially the downtown area of the District of Columbia. The 1.5X refers to Uber’s surge price that it pays drivers for being in that area. This is not a cost that the rider incurs. Uber is paying this surge fare to drivers for their willingness to drive in this circled area. Uber would rather pay drivers a surge fare than allow a surge to be incurred by riders. Surge pricing is a supply and demand game. The less drivers there are in an area in relation to the number of riders requesting, the more likely there will be a surge. Because Uber expects riders to really use the app at a high rate in this circled area, Uber wants to avoid having these people incur a surge fee. So, Uber pays the drivers a surge rate to be there.

This example shown above is only one area that Uber does this for. Areas northwest of the circled area in this image are often included. The surge rate that is paid to Uber drivers as an incentive varies based on times and days of the week. The Northwest section of D.C. has always been the home of the city’s most White and “professional” crowd. And this has been where Uber has chosen to incentivize drivers for driving. Despite Uber usage increasing by 600% in one year in S.E., a predominately Black area of town, those same incentive maps do not stretch to that part of town. Although incentive maps rarely go to the suburbs of D.C., when they do, they only touch affluent areas such as Bethesda, Silver Spring, and upscale areas near the Ronald Reagan airport.

Kalanick’s public commitment to lowering wait times and fees for lower-income people doesn’t seem to be the focus. If you’re in D.C. and live in S.E. or if you live in another area not filled with swank condos and coffee shops, your prospective drivers may not be as inclined to survey your neighborhood looking for riders at peak times. If drivers are not incentivized to be in your area, surge prices may occur and wait times may be longer. That doesn’t sound like a formula for to reducing car usage and attracting lower-income riders in “transportation deserts”.

If Uber wants to improve its public reputation, it needs to focus on the hard-working lower to middle class residents of the surrounding suburbs of big cities who come into big cities and contribute a lot for less pay. And making sure that Uber plays a part in them getting “to and ‘fro” in a reliable, cost-effective way is doable if Uber incentivizes its drivers to roam those areas. 

Humanize the driver

When Kalanick tells the story about Uber’s beginnings, he often refers to the idea of people being able to push a button and having a driver appear. He has a host of videos on YouTube where he’s being either interviewed or allowed to do talks about the company’s beginnings. I won’t bother posting them here. But if you look at them, you may notice something. Kalanick inadvertently or purposely has a flippant approach to describing the drivers and their role in the process. It sometimes seems that he never had a real appreciation for the driver, despite the driver being a central part to this concept working. This attitude seeps out during his heated dispute with the driver that recorded him arguing about fare prices.

The next C.E.O. of Uber can humanize drivers in a few ways:

  • Get real on ratings: If a driver receives a negative comment or report, the driver should be able to weigh in on the report before the claim is solidified. The company should review both sides before determining a liability. Case in point: I was once reported for not having “proper attire”. I woke up early one morning and jumped out of bed with basketball shorts and a tee shirt on. I received a request that would take me to an airport. When I arrived at the rider’s house, I put her bags in my trunk. I then unloaded the bag once we arrived at the airport. I had to bend over to pick the bags up and in that moment, my shirt lifted and the waistband of my underwear was briefly exposed. Just as a note, assisting in loading and unloading is not a requirement for Uber X. When I received the notification about my attire, I immediately knew who made the report. I wasn’t angry, but what was totally missed in this is that I assisted her with her luggage. I went out of my way to help her and all she could focus on was that for a brief second my shirt lifted enough for her to see the waistband of my underwear while she watches me life a 40 lb bag that belongs to her. This is not an Uber Black or some high-end car service. This is literally an $8 trip. Given that ride-sharing apps such as Uber and Lyft offer door-to-door service for the cheapest prices you’ll ever find, it should be a little harder for a negative report on a driver to hold weight without the driver having an opportunity to weigh in.
  • Tell the world that the majority of Uber drivers are not a threat: If Uber wants to counter the reported stories of drivers committing crimes while on duty, it should showcase drivers and driver stories and compliments that drivers receive. Although one negative story cant compare to the millions of safe and successful rides completed by drivers worldwide on a weekly basis, it weighs more when such a story goes viral. The investigation of Uber’s employment culture focused on eliminating bad apples in the office and public commitment to being a better employer. But the drivers on the street also need a commitment from Uber to showcase the stories of Uber drivers doing great things. To their credit, the company shares stories via email to other drivers about driver stories. But a bigger push to get positive driver stories out to the public could serve as a great counter to public perception of Uber drivers.
  • An Innovation Fund: The driverless vehicle phenomenon is here and it’s destined to further dehumanize the Uber driver in more than one way. Human drivers will more than likely lose jobs and value altogether. Not to mention, Lyft and Starbucks have entered into a partnership that looks to be a lasting one that will help the both of them to grow their presence in the arena of socially conscience companies. How can Uber respond to that? What if Uber offered its drivers an opportunity to be a part of a innovation contest that occurs periodically? Drivers often have other jobs, pursuits, or passions. What if the projects being worked on by drivers that impact the world are funded by Uber? If we know that the driverless vehicle phenomenon is here to stay, and drivers may have to pivot, why not begin to incentivize drivers to create new businesses that can be assisted by funding from Uber? This is a socially conscience way to assist in job creation as well as remain competitive with a rival in a space where doing good for world is also how the score is kept on which company is winning.

 

Improve the driver incentives

I mentioned the incentive maps and incentive trip threshold earlier. Expanding the incentive map to include lower-income areas is essential. In the article about Southeast D.C. ridership increasing 600% is a map that shows where Uber drivers live in the city. The majority of the drivers (according to the map) live in areas where it is least likely for Uber to offer incentives to drivers. In the image I posted early in this piece, I referred to the 37/39 number. For this week, my completing 39 Uber trips allows me to receive a bonus on top of my weekly earnings. Uber has an option for drivers to take advantage of “destination” trips twice a day. Two times in a day, I can notify Uber that Im heading in a particular direction by typing in the address. Uber will then only find riders heading that way. But, those trips don’t count toward my trip threshold for the bonus. Therefore, if I live in an area not incentivized and I want to head to the incentive map area to take advantage of the surge fees paid by Uber, I can either bypass the opportunity to get rides altogether in my neighborhood or set my app on the “destination” mode and get a trip heading that way; although it wont count as a trip to my weekly target. It’s a lot to try to figure out. But in short, widening the incentive maps to lower income communities would allow drivers who come from those areas that aren’t incentivized to start their shifts with Uber right in the areas where they live. This shortens the wait time for lower-income riders and incentivizes drivers who live there to be there as drivers as well.

One last thing about incentives. The trip incentives also play a role in determining your surge rate within the incentive map. So the more trips I complete, the more my surge reward from Uber will be during the next week. So from week to week, drivers are trying to hit a target to enjoy higher surge rates from Uber within those incentive maps. So often, drivers take a week off and have to start at square one with lower incentive rates. A much better way to help drivers is by having thresholds for a month and not a week. In the event that I take a vacation week, I can make up for it over the month to remain on target for my incentive goals.

It’s also time that we talk about the reality of Uber pricing. The prices are not likely to go up because of the fierce rivalry with Lyft. The increased usage of Uber Pool and Lyft Line are driving rates for each ride down even more for drivers. So we have to find other ways to create money-making opportunities for drivers. Vugo is an advertising company that allows drivers to make additional income from allowing their headrests to hold screens up that showcase advertisements from companies. Drivers share the ad revenue with Vugo. This seems like a pretty straight forward idea until you realize that a lot drivers wont invest money into purchasing screens for a nominal increase in revenue and they might not always have the knowledge to set up the account. With Uber’s wide reach, it can take an idea such as the one Vugo has created and go vertical with it. Uber already provides drivers with an iPhone specifically for its app (if the driver chooses). So why not provide an iPad and assistance with installing an advertising viewing app that can be created by Uber? This can assist drivers in making more revenue without raising fares.

I’d take it a step further. Why not create an Uber podcast network? Uber could create programming to be played by Uber drivers throughout the day. Content creators could pay to have space on the network. These fees and ad revenue generated on the network can be even another way for drivers to make more money.

There’s more to life than Uber

Uber drivers, riders, and workers are not defined by Uber. But Uber has changed our lives…hopefully for the better. In his letter to Uber employees, Kalanick stated:

“For the last eight years my life has always been about Uber. Recent events have brought home for me that people are more important than work, and that I need to take some time off of the day-to-day to grieve my mother, whom I buried on Friday, to reflect, to work on myself, and to focus on building out a world-class leadership team.

The ultimate responsibility, for where we’ve gotten and how we’ve gotten here rests on my shoulders. There is of course much to be proud of but there is much to improve. For Uber 2.0 to succeed there is nothing more important than dedicating my time to building out the leadership team. But if we are going to work on Uber 2.0, I also need to work on Travis 2.0 to become the leader that this company needs and that you deserve.”

We don’t know what 2.0 will bring, but people are indeed more important than work. It’s my hope that Uber will put a focus on the people doing the work….the drivers who go out day after day making this great app click the way that it does.

 

 

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