Lessons from taxi drivers on how not to run a business

The attack on Uber drivers worldwide was discussed in our entrepreneurship programme last week. We were talking about business strategy when Uber entered the discussion and took centre stage – as Uber is wont to do.

So you must know by now that Uber, the taxi hailing app, is taking over markets worldwide and driving traditional taxi drivers out of business, much to their consternation.

Some of the participants in our discussion have had conversations with regular taxi drivers, and were able to contribute their point of view. That said, no one in our class is in the taxi business, and our information is based on the noise that we have

witnessed. Still, we gleaned a few business lessons from all this.

IT IS ALWAYS ABOUT THE CONSUMER

Instead of seeking to understand the consumer and why their preferences have changed, taxi drivers are attacking Uber drivers. This victim mentality presupposes that somebody else is doing something to make things go wrong for you.

We want to stay in our comfort zone, do things the same way, and attack others who come and do it different. Our class concluded that the market had been ripe for an improved taxi experience for customers… but our taxi drivers did not seize this

opportunity. People use Uber because they don’t have to wait too long, the cars are clean, the drivers are polite and it is priced well. That’s where the competition is; it’s not just about the money.

I talked to a taxi driver before writing this article and when I asked him about Uber, all he did was complain. Words like ‘undercutting’ were thrown around. Not once did he talk about how he would improve service to the customer.

Improving customer experience will require our taxi drivers to do some actual work, which is harder than issuing threats to halt traffic and smash windows.

LET GO THE ENTITLEMENT MENTALITY

Traditional taxi drivers are complaining that Uber has taken what was not rightfully theirs. This is called entitlement mentality. The definition of madness is to do the same thing and expect a different result.

In the business world, and especially with the disruption that technology is bringing, it is important to ensure continuous feedback from your customer instead of expecting them to continue to accept the same old, same old, just because you think they

should. The graveyard is littered with brands that did not evolve with the times, and withered and died. Don’t let yours suffer the same fate.

RELATIONSHIPS ARE EVERYTHING

Those who invested in nurturing solid relationships may not have been affected all the way. I know a taxi driver who is unaffected by Uber. He has built a clientele for whom he runs domestic errands.

He picks kids up from school, takes them to and from birthday parties, collects groceries if need be, pays bills, takes people to hospital, etc. His car, which is always sparking clean, always has water, juice and light snacks for kids.

That’s service. Because of these relationships, he also does a lot of airport transfers. Uber cannot pick up children from school or be sent to pay a bill. If a person is trustworthy enough to pick my child from school he will probably be top of mind with a lot

of other things and may even get away with charging a bit extra.

There are many other situations where Uber will not work, and there are some people who still prefer to use someone with whom they have built a relationship. But while the upset drivers concentrate on slashing tyres they will not see these opportunities.

Our class concluded that in business you have to understand where your unique gap is and the reason why someone would be loyal to you. Also there is a target market that, if given enough attention, may respond to your service differently.

BEWARE FREE MARKETING

Thanks to the traditional taxi drivers and their noise, more people are now aware of Uber. Because of their protest, more people are seeking to find out how Uber works and why this has upset traditional drivers.

I spoke to an Uber driver who told me he is getting more work now. If the traditional taxis have spent that much time and effort on Uber, it means that there is something there worth exploring.

If you spend time and effort talking about your competition, you are giving them free publicity. However, if your competition is talking about you, it will work for your business.