What is uberization?
Uberization is replacing middlemen in business with high-tech, such as mobile apps or platforms where you can find a supplier for your demand. The platform facilitates interaction between a customer and the service provider and monitors service quality. The first aggregator company to take over the role of a middleman between customers and contractors was Airbnb. This service allows you to rent out accommodation for a short time. Uberization, however, got its name after another company - Uber. The company has created a mobile app that allows people to choose, hire and pay for private taxi services.
Today, more and more companies are using the same business model as Uber: they are launching platforms where sellers and buyers can independently negotiate a deal. Uberization usually contains three elements:
- The service intermediary between the seller and the buyer (for example, an app on a mobile phone).
- Companies that provide services.
- Consumers who buy services.
A service or an aggregator platform can act as an intermediary if the collaboration between the customer and the contractor can be regulated. Clear criteria for assessing the contractor's work can be developed. The platform can guarantee the quality of service, however, only if it is possible to establish such general standards.
Uberization is a completely new approach to the relationship between the company and the customer, which is beginning to impact business and the economy at large.
Uberization of the economy
Uberizing the economy is a process that involves the use of a wide variety of different technologies: cutting-edge business technologies in the first place. These processes are interconnected: without technical capabilities, it is difficult to rethink our approach to doing business, and without new approaches, even with the best technology, it is difficult to expect a qualitatively different result.
Business uberization might not be possible in all business areas. One of the main requirements for it is that the number of offers from contractors must exceed the demand. This will exclude the possibility of disruptions when a customer is waiting for a service for a long time. Uberization of a business is possible if it is relatively easy to find a contractor for the job, and their service can be evaluated according to certain criteria.
Uberization of services is underway, including taxi uberization. Uber has seen exponential growth thanks to its new business model and the number of offers that surpassed the demands for driver services.
Uber's success represents a combination of its new business model and innovative technologies. For example, one of the most essential elements of Uber's business model has been payment uberization. Today, the convenience of services that companies provide to their customers plays a huge role in any business, but in the case of uberization automation of a business process is absolutely critical. For example, data exchange in the company should be set up perfectly; otherwise, it will not be effective.
Market uberization is an inevitable process: companies have to adopt new approaches for building relationships with customers and organising work. Uberization has the biggest impact on relationships with employees, and recruitment uberization is under way.
Companies need recruitment uberization for jobs wherever there is a continuous need for new or temporary staff, or when the business needs to hire employees in another city or country. With the assistance of new technologies, it is possible to quickly fill personnel shortages and find employees during a crisis period. For example, suppose an employer needs to hire employees for seasonal work or for a major project. In that case, they can use a service that allows the employer to contact the recruiter directly rather than go through intermediaries. The first-ever platform developed for this was the BountyJobs website.
The company may also need the support of an HR manager to hire a highly qualified specialist with a narrow specialisation. An in-house HR manager might not have enough knowledge or business contacts in the area, to fulfil this criteria, and the company might need the help of a middleman, who can be found on an aggregator website.
Thanks to contracts and freelance exchanges, the uberization of labour is accelerating. There are more and more professionals who want more freedom and more mobility. They are ready for unstable earnings and seasonal work. This mode of working existed before, however, today they are becoming more and more popular.
Uberization of staff has accelerated because of the coronavirus pandemic: retail and courier services face unexpected challenges that new technologies have helped them respond to. The quarantine measures fuelled the development of new channels of commerce: people began to shop more frequently online with courier delivery. Companies needed to recruit more employees. Uberization allowed companies to find private recruiters who could quickly recruit staff or attract new employees using job aggregator sites.
Uber has become an emblem for a completely new way of doing business. The customer and the contractor can now work directly using a dedicated service (a mobile app or platform). In this situation, the platform guarantees that services meet the quality standards. Uberization is now mainly used in the service sector, where the service quality is easy to assess. In the future, however, uberization is set to become more widely used, including uberization in recruitment. The likelihood of this development is increasing due to the emergence of new technologies and our changing approaches to building a career.