What We Should Learn from Airbnb and Uber

When the CEO of a national Digital Transformation Office publicly states his department is ‘failing its customers’ you have to sit up and take notice. If a government department, with seemingly deep pockets, is not able to cope with the trials and tribulations of digital transformation then what hope is there for the rest of us?

Australia’s new Digital Transformation Office chief Paul Shetler said that Australia’s public service must stop failing customers and become as good as Airbnb and Uber at helping people. “Our job is to serve the public and we are failing,” he said. “If Amazon did that they’d go out of business.” This must have set off alarm bells not only in government and regulatory ranks but also in ‘blue ribbon’ corporations living in a legacy world and unable to cope with competition from agile newcomers nipping at their heels. Why?

Quite simply, many big established firms (and governments) have completely underestimated the speed at which digitization and digital transformation has taken hold. What is even more daunting is that regulation and statutes have fallen woefully behind and are being constantly challenged by the upstarts that have mastered the digital world so quickly and find ways to work around the rules.

They can do this because if their idea is good they quickly attract investors, quickly develop market value, quickly develop disruption and its followers and quickly grab market share. They basically don’t give a damn who they upset and what disruption they cause. When the proverbial ‘you know what’ hits the fan they shrug it off or get their lawyers to take over.

Shetler was right in referring to Uber as one of his examples. It has challenged a market sector heavily-protected in most countries simply by giving people what they really want, great service, and all via their ubiquitous smartphones.

Taxi companies have tried for years to provide better service through apps and call centres but they have never even come close to Uber’s brilliant self-regulating ecosystem. The fall-back for taxi companies is to either call on the regulator to step in and protect them, demonstrate and close off city streets that upsets their ‘customers’ or simply beat up Uber drivers. Uber will win out in the end, but it could be a long battle. Hopefully it will not deter other disruptors out there.

For those being threatened or left behind by the transforming digital world the effect on their business can be catastrophic. Bricks and mortar outlets such as retailers and banks are being hit hardest. The subsequent loss of trade is causing massive layoffs and that means more pressure on governments in supplying unemployment benefits. Businesses and governments need to work out where these people can be redeployed but if their own systems are woefully behind the curve as Shetler pointed out, how can they?

Telecoms operators may be next to feel the crunch. As Alex Leslie pointed out in this article, new technology and new players are etching away at their sacred space. What breakthrough technology lies around the corner that will give them the ability to provide connectivity without laying down fibre or having to buy spectrum? Is it a matter of wait and see or investing in innovation themselves?

Judging from what we are seeing so far those network operators seem focussed on making their networks faster, and new revenue streams from providing digital services they are not familiar with. This brings them in direct competition with the Googles, Amazons, Facebooks and Alibabas of this world – oh aren’t they the same ones playing around with their own alternative networks?

This article was originally published by DisruptiveViews. It has been reproduced with their permission.

Tony Poulos
Tony Poulos
Tony is a freelance writer, regular speaker, MC and chairman for the telecoms and digital services industries worldwide. He has founded and managed software and services companies, acts as a market strategist and is Editor of DisruptiveViews.

In June 2011, Tony was recognized as one of the 25 most influential people in telecom software worldwide.