Explorative Versus Exploitative Business Model †MyAssignmenthelp

Question: Discuss about the Explorative Versus Exploitative Business Model. Answer: Introduction The current business scenario is both offering opportunities and challenges for the contemporary business organizations. Thus, it is up to the business organizations to effectively identify the business challenges and initiates strategies accordingly. One of the major sectors, which are witnessing huge competition and market growth, is the app based cab services. Similar to the global business scenario, Canadian market is also witnessing the market growth of online cab hailing services (Rayle et al., 2016). Victoria taxi is one of the leading cab aggregators in Canada and having their presence in different locations (Victoriataxi.com, 2018). They are mainly known for eco-friendly cab services by using electric and hybrid vehicles in road. This report will discuss about the external and internal factors faced by Victoria taxi in their business operations along with discussing some strategies and business level functions in order to overcome the challenges. Victoria taxi is relatively new cab aggregators in the market and thus they are having less hierarchical structure in their organization. According to the gathered information, they follow flat and horizontal organizational structure in order to initiate effective communication among all the stakeholders (Tran Tian, 2013). The organization is being directed by the director who is also the acting CEO. Under him, total four executives are working and they directly reports to the CEO. Under each of the executives, separate departments are being allotted and each of these executives is responsible for their respective departments. Employees in every department are reporting to these executives. External environmental factors Political Canada is having favorable political environment, which helps Victoria taxi to operate positively. However, favorable political environment of Canada is also attracting huge foreign investments (Aharoni, 2015). More foreign investments are causing entry of global competitors. Competition is thus getting increased. However, it is also to be noted that change in the political scenario may have adverse impact on the business operation. Economical Canada is having good number of competitors in the online cab services. Thus, profitability is low for the organizations. However, having favorable economic growth is creating business opportunities for Victoria taxi (Panayotou, 2016). On the other hand, issues such as economic recession can cause negative impact on the business operation of Victoria taxi. Emergence of new alternative of public transportation such as monorail is challenging the shuttle business. Social Increase in the income of the customers is increasing the business opportunities. Enhanced income level letting the customer to prefer premium mode of transportation. Having environmental friendly fleet is helping Victoria taxi to have positive impression in the market. Technological Victoria taxi is having their own mobile application, which lets the customers to book their cab at any point of time. Their cabs are also technologically sound with having different amenities and safety features for their customers. Their app is technologically at par to the industry standard and thus they are also providing real time tracking facility to the customers (Bond, 2014). It is always important for Victoria taxi to stay updated with their technology. Environmental Environment is one of the major aspects to be considered in the cab industry. Cab industry is directly linked to the vehicle emission. Thus, it is important for Victoria taxi to be complied with environment (Jenn, Azevdeo Ferreira, 2013). They have initiated hybrid vehicles in their fleet to reduce the vehicle emission. Legal Legal regulations are strict and stringent in Canada regarding online cab services (Grrenblatt Shaheen, 2015). Origination of different ethical issues is attracting lawsuits. It is important for Victoria taxi to adhere to the newer amendments of law. Determination of the internal analysis Strengths Victoria taxi is having positive brand value in the market. Having hybrid fleet is helping them to have distinctive image in the market. Having market presence in different sectors ranging from airport transport to West Shore community. Weaknesses Victoria taxi is limited to Douglas city and thus they are having limited market opportunities. They are having less market share compared to some other leading cab aggregators. Catering to more premium customers. Thus, the market opportunities are limited. Opportunities Demand for online cab services is rapidly increasing in Canada as well as in the global market. Customers are more preferring premium cab facilities over the regular ones. Entering in other regions will enhance the market opportunities for Victoria taxi. Threats Entry of new competitors in the market will reduce the profitability of Victoria taxi. Risk of emergence of unethical issues will dent the brand image of Victoria taxi in the future. Market trend and preference pattern can get changed at any point of time. Thus, it may have adverse impact on the business operation of the Victoria taxi. Identification of the risks There are various issues being identified that are having impact on the business operation of Victoria taxi. The following sections will discuss about the identified issues. Victoria taxi is one of the leading companies with having innovative market and business approach. However, origination of the disruptive innovation in the industry will have negative impact on the business of Victoria taxi (Osiyevskyy Dewald, 2015). This is due to the reason initiation of the new innovation by some other competitors will take away their customer base. For instance, offering of the pool service by Uber is providing similar services to the customers with fewer prices. In the current business scenario, this risk will always be there with Victoria taxi. Though, Victoria taxi is having hybrid cars in their fleet but still they are facing the risk of climate and environmental change. This is due to the reason that their business operation is mainly dependent on the cars and their fuel usage (Fajerztajn et al., 2013). Thus, non availability of fuels in the future will be a major risk for Victoria taxi. On the other hand, due to the environmental degradation, more stringent legislations are being initiated by the government and it will have negative impact on their business operations. In the recent time, there are various issues being originated with different app cab brands regarding the exploitation of the customers and abusing by the drivers. These types of issued can get generated with Victoria taxi at any point of time. Emergence of these types of issues will have negative impact on the business operation of Victoria taxi. Their brand value will get tarnished with this and will reduce their brand attractiveness. Recommended business practices It is recommended that Victoria taxi should initiate market development strategy. This will help them to enhance their market share and exposure in the foreign markets. The more will be their market presence, the less will the risk associate with single market (Vahlne Johanson, 2017). It is also being recommended that Victoria taxi should also initiate product development strategy. With the help of the product development strategy, they will have more diverse service offerings, which will enable them to cater to diverse set of customers. Therefore, the more will be their diverse set of customers, the more will be their brand penetration in the market. Victoria taxi should also initiate the product diversification strategy. This will help to have their presence in the different market with different service offerings. For instance, Victoria taxi is already having cab services as their existing business. In addition, they can also have their business in car rentals. This is related to their existing business but with different set of customers. This will also reduce the risk associated with single service offerings. Leadership is one of the major business functions, which will help in achieving the recommended strategies. This is due to the reason that the more visionary will be the approach of the leadership, the more will be the possibility of initiating market development and diversification strategies (Giltinane, 2013). Effective leadership roles will help in engaging and motivating and leading the employees in future. Another business function, which is important, is organizing. This is due to the reason that effective process of organizing in the organization will help in managing the human and financial resources effectively. This is important in having effective and efficient business strategies in place. Organizing will also help in having seamless flow of the resources in the business operation. Conclusion Thus, it is concluded that Victoria taxi is having number of external and internal issues in their business operation. It is important for them to effectively mitigate the risks faced by them. This essay discussed about some of the major risks being faced by them along with discussing some effective strategies. These strategies will help Victoria taxi to enhance their business potentiality. These strategies will also help them in having more market share and exposure along with having more penetration in the market. It is expected that these strategies will help in mitigating the risks faced by Victoria taxi. Reference Aharoni, Y. (2015). The foreign investment decision process. InInternational Business Strategy(pp. 24-34). Routledge. Bond, A. T. (2014). An app for that: Local governments and the rise of the sharing economy.Notre Dame L. Rev. Online,90, 77. Fajersztajn, L., Veras, M., Barrozo, L. V., Saldiva, P. (2013). Air pollution: a potentially modifiable risk factor for lung cancer.Nature Reviews Cancer,13(9), 674. Greenblatt, J. B., Shaheen, S. (2015). Automated vehicles, on-demand mobility, and environmental impacts.Current sustainable/renewable energy reports,2(3), 74-81. Jenn, A., Azevedo, I. L., Ferreira, P. (2013). The impact of federal incentives on the adoption of hybrid electric vehicles in the United States.Energy Economics,40, 936-942. Osiyevskyy, O., Dewald, J. (2015). Explorative versus exploitative business model change: the cognitive antecedents of firm?level responses to disruptive innovation.Strategic Entrepreneurship Journal,9(1), 58-78. Panayotou, T. (2016). Economic growth and the environment.The environment in anthropology, 140-148. Rayle, L., Dai, D., Chan, N., Cervero, R., Shaheen, S. (2016). Just a better taxi? A survey-based comparison of taxis, transit, and ridesourcing services in San Francisco.Transport Policy,45, 168-178. Tran, Q., Tian, Y. (2013). Organizational structure: Influencing factors and impact on a firm.American Journal of Industrial and Business Management,3(2), 229. Vahlne, J. E., Johanson, J. (2017). The internationalization process of the firma model of knowledge development and increasing foreign market commitments. InInternational Business(pp. 145-154). Routledge. Victoriataxi.com. (2018).Victoriataxi.com. [online] Available at: https://victoriataxi.com/services [Accessed 31 Mar. 2018].