Question 3: Netflix wants to stay ahead of their competitors (for example: Disney+, Amazon Prime Movies, Hulu, and New Zealand companies like LightBox, NEON, etc.). What strategy for growth and downsizing do you think Netflix could use to stay the dominant in the marketplace? Explain your choice. (10 marks – allow ~15 minutes)

Netflix Case: Netflix Uses Technology to Change How We Watch Videos

When Netflix was founded in 1997 in the United States, the movie rental giant Blockbuster had thousands of stores from coast to coast, filled with video cassettes ready for immediate rental to customers (Pride et al., 2018). Netflix had a different vision from this well-established, well-financed competitor. Looking at the recent development of DVD technology, Netflix saw an opportunity to change the way consumers rent movies. The entrepreneurial company built its marketing strategy around the convenience and low cost of renting DVDs by mail, for one low monthly subscription fee.

Instead of going to a local store to pick out a movie, subscribers logged onto the Netflix website to browse the DVD offerings and click to rent. Within a day or two, the DVD would arrive in the customer’s mailbox, complete with a self-mailer to return the DVD. And, unlike any other movie rental service, Netflix customers were invited to rate each movie on the Netflix website, after which they’d see recommendations tailored to their individual interests (Pride et al., 2018).

Fast-forward to the 21^st century. Video cassettes are all but obsolete, and Blockbuster, once the dominant brand in movie rentals, has only one remaining shop in the US as consumer demand has shifted to digital distribution for entertainment (Porter, 2019). In Australia, both Blockbuster and Video Ezy still had a brand presence in 2018 (Pride et al., 2018). Since then, Blockbuster’s last Australian shop closed in March 2019 (Porter, 2019), and Video Ezy exists in the form of vending machines (kiosks) after its shops closed (Rosenberg, 2018).

Both brands have been prompted to reassess their distribution channels. You may notice more DVD rental kiosks such as “Video Ezy Express” popping up in convenient locations, including outside supermarkets and shopping complexes, in a bid to improve brand reach and accessibility. DVD rental kiosks, like online services, are accessible around the clock and reduce many store costs, including wages.

In contrast, by completely eliminating the need for brick-and-mortar stores or kiosks, Netflix has minimised its costs and extended its reach to any place that has postal service and Internet access (Pride et al., 2018). The company still rents DVDs by mail (Monahan & Griggs, 2019), but it has also taken advantage of changes in technology to add video streaming on demand.

Now, customers can stream movies and television programmes to computers, television sets, videogame consoles, DVD players, Smartphones, and other web-enabled devices. One advantage to the company is that streaming a movie costs Netflix less per customer than paying the postage to deliver and return a DVD to that customer.

Netflix’s Use of Technology: From Data-Tracking to Streaming

Netflix made technology a core competency from the very beginning. Because the business has always been web-based, it can electronically monitor its customers’ online activity and analyse everything that customers view or click on.

With this data, Netflix can fine-tune the website, determine which movies are most popular among which market segments, prepare for peak periods of online activity, and refine the recommendations it makes based on each individual’s viewing history and interests. The company also uses its technical know-how to be sure that the website looks good on any size screen, from a tiny Smartphone to a large-screen television.

A few years ago, planning for a significant rise in demand for streaming entertainment, Netflix decided against investing in expanded systems for this purpose. Instead, it arranged for Amazon Web Services to provide the networking power for streaming (Pride et al., 2018).

By 2018, on a typical night in the US, Netflix streaming occupied up to 20,000 servers in Amazon data centres (Pride et al., 2018). Demand was so strong by that time, in fact, that Netflix streaming accounted for about one-third of all internet traffic to North American homes during the evening (Pride et al., 2018). This percentage is only expected to increase. The Australian market, however, may pose technological hurdles, as the National Broadband Network is still being rolled out and is not available in all areas, meaning that accessibility may not be as straightforward as it is in America (Department of Infrastructure, Transport, Regional Development and Communications, n.d.).

Although Blockbuster and Video Ezy are no longer a competitive threat in their traditional form, Netflix does face competition from Amazon’s own video streaming service, Amazon Prime Video, which headed to Australia and New Zealand’s shores in 2017 (Pride et al., 2018).

Other direct competitors include well-established Hulu, YouTube, Nine Entertainment, and

Fairfax media’s joint-venture Stan, and Foxtel’s movie-streaming service Presto. It also competes with other entertainment providers, including cable, satellite, and broadcast television. Foxtel, for example, has dramatically reduced its basic cable packages in an effort to retain its share of the market in face of increasing competition from on-demand services (Pride et al., 2018).

Netflix Offers Exclusive Programming to Customers

To differentiate itself from its competitors, Netflix commissioned exclusive programming such as House of Cards, Arrested Development, and Orange is the New Black. The cost to produce such programs runs to hundreds of millions of dollars (Pride et al., 2018). Between May–December 2019, Netflix added 179 original programmes to its American streaming service, or an average of 30 new shows a month, or about one show per day (Fruhlinger, 2019). Netflix plans to continue pouring money into exclusive content because of the payoff in positioning, positive publicity, and customer retention.

The way that Netflix releases its exclusive programming reflects its in-depth knowledge of customer behaviour. The company found through its data analysis that customers often indulge in ‘binge watching’ for a series they like, viewing episodes one after another in a short time.

Based on this research, in 2013 Netflix launched all 13 episodes of the inaugural season of House of Cards at one time, an industry first (Pride et al., 2018). Executives gathered at headquarters to monitor the introduction, cheering as thousands of customers streamed episode after episode. By the end of the first weekend, many customers had watched the entire series and shared their excitement via social media, encouraging others to subscribe and watch. When Netflix won multiple Emmy Awards for House of Cards, it was another first—the first time any Internet company had been honoured for the quality of its original programming.

One key measure of Netflix’s growth is the strong increase in the number of monthly subscribers. In 2015, Netflix had about 70 million subscribers worldwide, of which 26 million were located outside the US (Pride et al., 2018). In 2019, Netflix had 151 million paid subscribers worldwide (158 million if free trials are included) (Kafka, 2019).

Despite the brand only launching in Australia in March 2015, it already has close to 2 million subscribers in 2018 (Pride, 2018). By July 2019, Netflix had more than 11.6 million subscribers in Australia, up 18% from the year prior (Gruenwedel, 2019) Its closest direct competitor, Stan, had 2.6 million subscribes in early 2019 (Knox, 2019).

Netflix will not say how many subscribers that it has in New Zealand, but a recent survey of 1,000 people, commissioned by the Office of Film and Literature Classification and carried out by UMR Research, found that 72% of respondents subscribed to Netflix. Of the same respondent sample, 77% said they watched television shows and movies using a paid online service (Kenny, 2019).

Keys to Netflix’s successful launch include offering free-trials and access to stripped-back free versions, as well as continued investment in original programming. It appears that streaming is the new broadcasting, and that ‘on-demand’ spells the demise of scheduled entertainment.

Question 2: Outline the most important macro (demographic, economic, natural, technological, political and cultural), and micro (the company, suppliers, marketing intermediaries, competitors, publics, and customers) environment factors that impact on Netflix. (10 marks – allow ~15 minutes)

Netflix Case: Netflix Uses Technology to Change How We Watch Videos

When Netflix was founded in 1997 in the United States, the movie rental giant Blockbuster had thousands of stores from coast to coast, filled with video cassettes ready for immediate rental to customers (Pride et al., 2018). Netflix had a different vision from this well-established, well-financed competitor. Looking at the recent development of DVD technology, Netflix saw an opportunity to change the way consumers rent movies. The entrepreneurial company built its marketing strategy around the convenience and low cost of renting DVDs by mail, for one low monthly subscription fee.

Instead of going to a local store to pick out a movie, subscribers logged onto the Netflix website to browse the DVD offerings and click to rent. Within a day or two, the DVD would arrive in the customer’s mailbox, complete with a self-mailer to return the DVD. And, unlike any other movie rental service, Netflix customers were invited to rate each movie on the Netflix website, after which they’d see recommendations tailored to their individual interests (Pride et al., 2018).

Fast-forward to the 21^st century. Video cassettes are all but obsolete, and Blockbuster, once the dominant brand in movie rentals, has only one remaining shop in the US as consumer demand has shifted to digital distribution for entertainment (Porter, 2019). In Australia, both Blockbuster and Video Ezy still had a brand presence in 2018 (Pride et al., 2018). Since then, Blockbuster’s last Australian shop closed in March 2019 (Porter, 2019), and Video Ezy exists in the form of vending machines (kiosks) after its shops closed (Rosenberg, 2018).

Both brands have been prompted to reassess their distribution channels. You may notice more DVD rental kiosks such as “Video Ezy Express” popping up in convenient locations, including outside supermarkets and shopping complexes, in a bid to improve brand reach and accessibility. DVD rental kiosks, like online services, are accessible around the clock and reduce many store costs, including wages.

In contrast, by completely eliminating the need for brick-and-mortar stores or kiosks, Netflix has minimised its costs and extended its reach to any place that has postal service and Internet access (Pride et al., 2018). The company still rents DVDs by mail (Monahan & Griggs, 2019), but it has also taken advantage of changes in technology to add video streaming on demand.

Now, customers can stream movies and television programmes to computers, television sets, videogame consoles, DVD players, Smartphones, and other web-enabled devices. One advantage to the company is that streaming a movie costs Netflix less per customer than paying the postage to deliver and return a DVD to that customer.

Netflix’s Use of Technology: From Data-Tracking to Streaming

Netflix made technology a core competency from the very beginning. Because the business has always been web-based, it can electronically monitor its customers’ online activity and analyse everything that customers view or click on.

With this data, Netflix can fine-tune the website, determine which movies are most popular among which market segments, prepare for peak periods of online activity, and refine the recommendations it makes based on each individual’s viewing history and interests. The company also uses its technical know-how to be sure that the website looks good on any size screen, from a tiny Smartphone to a large-screen television.

A few years ago, planning for a significant rise in demand for streaming entertainment, Netflix decided against investing in expanded systems for this purpose. Instead, it arranged for Amazon Web Services to provide the networking power for streaming (Pride et al., 2018).

By 2018, on a typical night in the US, Netflix streaming occupied up to 20,000 servers in Amazon data centres (Pride et al., 2018). Demand was so strong by that time, in fact, that Netflix streaming accounted for about one-third of all internet traffic to North American homes during the evening (Pride et al., 2018). This percentage is only expected to increase. The Australian market, however, may pose technological hurdles, as the National Broadband Network is still being rolled out and is not available in all areas, meaning that accessibility may not be as straightforward as it is in America (Department of Infrastructure, Transport, Regional Development and Communications, n.d.).

Although Blockbuster and Video Ezy are no longer a competitive threat in their traditional form, Netflix does face competition from Amazon’s own video streaming service, Amazon Prime Video, which headed to Australia and New Zealand’s shores in 2017 (Pride et al., 2018).

Other direct competitors include well-established Hulu, YouTube, Nine Entertainment, and

Fairfax media’s joint-venture Stan, and Foxtel’s movie-streaming service Presto. It also competes with other entertainment providers, including cable, satellite, and broadcast television. Foxtel, for example, has dramatically reduced its basic cable packages in an effort to retain its share of the market in face of increasing competition from on-demand services (Pride et al., 2018).

Netflix Offers Exclusive Programming to Customers

To differentiate itself from its competitors, Netflix commissioned exclusive programming such as House of Cards, Arrested Development, and Orange is the New Black. The cost to produce such programs runs to hundreds of millions of dollars (Pride et al., 2018). Between May–December 2019, Netflix added 179 original programmes to its American streaming service, or an average of 30 new shows a month, or about one show per day (Fruhlinger, 2019). Netflix plans to continue pouring money into exclusive content because of the payoff in positioning, positive publicity, and customer retention.

The way that Netflix releases its exclusive programming reflects its in-depth knowledge of customer behaviour. The company found through its data analysis that customers often indulge in ‘binge watching’ for a series they like, viewing episodes one after another in a short time.

Based on this research, in 2013 Netflix launched all 13 episodes of the inaugural season of House of Cards at one time, an industry first (Pride et al., 2018). Executives gathered at headquarters to monitor the introduction, cheering as thousands of customers streamed episode after episode. By the end of the first weekend, many customers had watched the entire series and shared their excitement via social media, encouraging others to subscribe and watch. When Netflix won multiple Emmy Awards for House of Cards, it was another first—the first time any Internet company had been honoured for the quality of its original programming.

One key measure of Netflix’s growth is the strong increase in the number of monthly subscribers. In 2015, Netflix had about 70 million subscribers worldwide, of which 26 million were located outside the US (Pride et al., 2018). In 2019, Netflix had 151 million paid subscribers worldwide (158 million if free trials are included) (Kafka, 2019).

Despite the brand only launching in Australia in March 2015, it already has close to 2 million subscribers in 2018 (Pride, 2018). By July 2019, Netflix had more than 11.6 million subscribers in Australia, up 18% from the year prior (Gruenwedel, 2019) Its closest direct competitor, Stan, had 2.6 million subscribes in early 2019 (Knox, 2019).

Netflix will not say how many subscribers that it has in New Zealand, but a recent survey of 1,000 people, commissioned by the Office of Film and Literature Classification and carried out by UMR Research, found that 72% of respondents subscribed to Netflix. Of the same respondent sample, 77% said they watched television shows and movies using a paid online service (Kenny, 2019).

Keys to Netflix’s successful launch include offering free-trials and access to stripped-back free versions, as well as continued investment in original programming. It appears that streaming is the new broadcasting, and that ‘on-demand’ spells the demise of scheduled entertainment.

In share economy there are ethical challenges to be considered. List one challenge and apply deontology or teleology to explain how these might be overcome.

1. What is a Document under ISO9000?

2. Briefly explain Eight (8) key principles of ISO9000:2000

describe how you will design a package for a long shelf for a natural fruit juice for export to europe in a short but precise essay

AURAK Paper Plant AURAK Paper Factory, located near downtown RAK, has long been delaying the expense of installing air pollution control equipment in its facility. The Environmental Protection Agency (EPA) has recently given the manufacturer 16 weeks to install a complex air filter system. AURAK Paper has been warned that it may be forced to close the facility unless the device is installed in the allotted time. The Plant Manager, wants to make sure that installation of the filtering system progresses smoothly and on time. Given the following information, develop a table showing activity precedence relationships. AURAK Paper has identified the eight activities that need to be performed in order for the project to be completed. When the project begins, two activities can be simultaneously started: building the internal components for the device (activity A) and the modifications necessary for the floor and roof (activity B). The construction of the collection stack (activity C) can begin when the internal components are completed. Pouring the concrete floor and installation of the frame (activity D) can be started as soon as the internal components are completed and the roof and floor have been modified. After the collection stack had been constructed, two activities can begin: building the high-temperature burner (activity E) and installing the pollution control system (activity F). The air pollution device can be installed (activity G) after the concrete floor has been built. Finally, after the control system and pollution device have been installed, the system can be inspected and tested (activity H). Activities and precedence relationships may seem rather confusing when they are presented in this descriptive form. It is therefore convenient to list all the activity information in a table first. You are required to: 1. Draw AON network diagram for AURAK Paper Plant 2. What is the critical path method of this diagram? 3. What is the impact on the sequence of activities if EPA approval is required after Inspect and Test?

Discuss with examples Type-I and Type-II errors relative to the SPC theory of control charts.

What practical implication in terms of process operation do these two types of errors have?

A head office of a beer company is based in Mauritius and wants to expand abroad. What are the factors that you should take into consideration before a new branch is opened abroad.

Assignment of Word count is 3500 - 4500

Using stakeholder analysis, analyse the power and level of interest of the relevant stakeholders involved in running and regulating the London taxi business.

Uber are often accused of ignoring employee rights and employee welfare. How might Uber management address their employees’ concerns?

Guidance notes:

In Sessions 2 of Block 3 you encountered the concept of stakeholder analysis, as a key part of analysing the political context. In particular, Activity 2.1 and Reading 4 discussed some of the theory supporting stakeholder analysis and gave you the opportunity to undertake a practice exercise. The stakeholder analysis framework shown in Reading 4 Figure 1 may help with your answer.

The second part of Question 1 requires you to look at some of the employee relations issues that are taking place at Uber. Block 3, Session 4, introduced you to the idea of inclusive and participatory employment relations. In particular, Reading 6 discussed the importance of employee ‘voice’ and why voice matters in modern organisations. Block 3, Session 5, discusses the issues of flexible working and employee empowerment. Activity 5.1 looks at the importance of involving employees and suggests ways this might be achieved. Your answer should draw on appropriate concepts and theories from Block 3 together with suitable evidence from the case study to support your arguments.

Case study:

Technological challenges in the taxi industry

Uber is a technology company that offers a free programme, or app, available on a mobile device for those wishing to request a ride. At its core, Uber seeks to match passengers to drivers. The platform is able to track a user’s GPS coordinates, even if the user does not know where they are, and within minutes an Uber driver will arrive. The user is able to track how long until the ride will pick them up and receives a text message confirming when the Uber driver is arriving. The driver is able to hit a button on their own app that says ‘Arriving now’ which sends the text message. No cash is exchanged when using Uber since signing up for an account requires providing credit card information. After the ride, Uber charges the user electronically and immediately emails them a receipt. There is a rating system so that passengers can rate their driver and vice versa (Dong et al, 2014).

According to Uber, the company ‘pushes the limits of the transportation industry to create a simple, more efficient, and more enjoyable car service experience. For drivers, Uber is a revenue stream, allowing professional drivers to make more money by turning downtime into profits.’ (Uber, 2016). Unlike the taxi industry, Uber does not employ or license its drivers, but rather views them as independent contractors. The unique experience provided by Uber has enabled rapid growth and international expansion centred on three main focal points: a commitment to on-demand service, an efficient supply of luxurious rides, and the easy accessibility of its smartphone application.

Uber’s growth over the past five years is an example of a major success in what is known as the ‘sharing economy’. The sharing economy is an economic system where assets or services are shared between private individuals either free or for a fee, typically by means of the internet. However, the success of this new business model is attracting criticism from government and civic leaders concerned that this new ‘collaborative economy’ is simply a means of sidestepping regulations, taxes and other legal obligations. These ‘gig economy’ apps have been criticised for failing to provide traditional employee rights such as paid holidays and in-work insurance.

The size of the UK taxi and private hire market is estimated at £9.4 billion. The industry is mature, with high levels of revenue volatility, technological changes, and high competition with low barriers to entry (Skok & Baker, 2019). In London, Uber’s growing popularity meant that their drivers completed some £115m of business within London (Quinn, 2016). However, Uber London (the taxi app’s UK holding company) recorded only a sales take of £23m and a profit before tax of £1.83m. The sales figure reflects only Uber’s share of fares for trips booked on its app. In addition, Uber London retain 20% of any fare to the driver. Despite this Uber London paid just the small sum of £411,000 in UK tax last year.

Concerns have also been raised over driver working conditions, particularly regarding claims that some drivers are doing excessive and unsafe hours.

Some Uber drivers are working up to 21 hours a day to make ends meet as the company increases its cut of fares and fights a ruling giving them employment rights. Drivers in London interviewed by The Sunday Times told of regularly working hours that Uber itself describes as ‘unsafe’. The newspaper has seen official Uber documentation proving one of the men worked a 91-hour week. The disclosures come as new figures show a dramatic rise in casualties involving taxis and private hire vehicles in London.

In interviews with 12 Uber drivers waiting at Heathrow, three admitted working 16 hours or more a day. Tom, from High Wycombe, said: ‘On average every day [I work] 14 hours, and 16 is top whack. I had a colleague last week who said he had worked 19 hours. I know people who even sleep in the car, and they go crazy … I can start at six o’clock in the morning and finish the following day at maybe two o’clock, three o’clock,’ – a 20 or 21-hour day.

A second driver, Peter, said: ‘Recently, Uber cut rates per mile by 25%. Now I’m having to work longer and longer hours in order to pay my rent. I want people to know how powerless you feel when your income comes from a faceless app and when you open it up one morning, things are just different and you’re earning less money and there’s no boss you can talk to, you weren’t told about it, you just see your income is lower today and you just have to deal with it’. A third Uber driver, Khaled, said ‘We need to speak the truth. I work 70-80 hours a week and weekends it’s 14-16 hours a day. There are plenty of days where, minus petrol, I make less than minimum wage. It’s very, very stressful but I don’t have a choice. I feel like I’m a slave; we work like slaves for this company. I wish I knew what I know now earlier,’ he said. ‘I was blindsided. If I knew about the expenses, just how expensive it is to do this gig, then I wouldn’t have gone into it in the first place’. The legal limit for a bus or lorry driver is 56 hours a week.

Another Uber driver, Razak, said: ‘Once Uber got control of the market, they changed in the worst ways. When I started I made 80% of the fees from my fares with 20% going to Uber. Now they are charging anything they want, sometimes taking as much as 60%. All drivers are asking for is fair pay, and that’s what Uber won’t give to us. They are not willing to be transparent. They are willing to change the logo, they are willing to advertise, to spend millions on lobbying, but they are not willing to pay the drivers fairly. Uber treats drivers as just something they have to deal with until technology for autonomous cars gets to the point where they can eliminate drivers all together. They don’t listen to us’. Three other drivers could not be interviewed because they were asleep in their cars. One had installed curtains in the vehicle.

Figures published in 2016 by the London transport regulator, Transport for London (TfL), show there has been a 26% rise in casualties among taxi and minicab passengers during the previous year. The number of passengers killed or seriously injured rose from 13 to 20, a 54% rise.

However, Uber UK said it had no plans to limit driver hours. In London, for new drivers, it has increased the cut it takes on fares from 20% to 25%, forcing them to drive for longer to earn the same money.

The company suffered a blow in 2017 when an employment tribunal ruled that Uber drivers were not self-employed, and were entitled to holiday pay, pensions and other workers’ rights. In 2018 it appealed against this ruling but lost. The Appeal Court judges found there was a “high degree of fiction” in the wording of the standard agreement between Uber and its drivers. The judgement went on to state that “For Uber to be stating to its statutory regulator that it is operating a private hire vehicle service in London and is a fit and proper person to do so, while at the same time arguing in this litigation that it is merely an affiliate of a Dutch-registered company which licenses tens of thousands of proprietors of small businesses to use its software, contributes to the air of contrivance and artificiality which pervade’s Uber’s case.” (Butler, 2018). Uber is appealing this latest judgement.

Steve Garelick, of the professional drivers’ branch of the GMB union, said: ‘Through the app, Uber knows precisely how long everyone has been available. It and other operators could stop this overnight if they wanted to. They’ve made the effort to limit hours in New York, so what’s wrong with London?’ Tom Elvidge, general manager of Uber London, said that three-quarters of Uber drivers in the capital were logged in to the app for less than 40 hours a week. ‘We regularly advise drivers to take rest breaks’ he said. ‘We take this issue very seriously and are always looking into ways to improve the overall safety of the app.’

Uber London actively resists attempts by TfL or other government agencies to bring in any regulation of its services, or to bring its service into line with the historic business practices of London’s historic black cabs. The European Parliament has approved new minimum rights for workers in ‘gig economy’ jobs, including Uber drivers. Under the European Union (EU) regulations, casualised employees across Europe will have a right to compensation from their bosses for last-minute cancellation of work, mandatory training will have to be provided free of charge, and ‘exclusivity clauses’ that ban workers from taking other jobs will also be banned. The UK could end up following EU rules at this point if the Brexit transition period is extended, meaning the rights could apply to workers in the UK. However, if the UK leaves the EU earlier, employees will not benefit from the rules and will probably be exposed to harsher employment conditions (Stone, 2019).

In 2017, Uber was rocked by a former employee’s devastating assessment of her time working at the company. She detailed several instances of sexual harassment and a culture that did not welcome women. In response, Uber launched an investigation involving more than 100 ‘listening sessions’ across the company. The report concluded that ‘The focus of the company had been on the business and not the employees’ and that the atmosphere at the company had created a ‘cult of the individual’ (Lee, 2017).

London’s taxis are responding to the technological challenges presented by Uber, and TfL announced last year that all black cabs in London would be required to take credit cards and contactless payments from October 2016.

Groups representing taxi drivers said the decision by TfL would benefit both drivers and customers. The move by TfL’s board followed a consultation in which it received support from 86% of respondents.

‘Every black cab taking cards is fantastic news for London. In future, when you hail a cab you can be sure that you can pay the way you like – card, contactless or cash. That is without doubt better for our customers and for drivers who will benefit from extra work,’ said Steve McNamara, general secretary of the Licensed Taxi Drivers Association.

The move towards mandatory card payments in black cabs is part of wider changes by London’s 22,500 cabbies in rising to the challenge from Uber. For example, some black-cab operators are fighting back with smartphone apps of their own, such as Hailo and Gett. Gett offers discounts on metered fares for journeys of six miles or more and those made in off-peak hours. Hailo allows Londoners to get a taxi through their smartphone.

Remo Gerber, chief executive of Gett UK, said: ‘This is another strong sign of how the London black cab trade is embracing the future; not only have cabbies embraced apps, but everyone is behind making card payments universally accepted and by that making all journeys easier for Londoners.’

The firm’s application for a new licence in London was rejected in September 2017 on the basis that the company is not a ‘fit and proper’ private car hire operator. At an appeal, a court decided Uber should be awarded a 15-month probationary licence to operate in London after the ride-hailing service promised improvements. In May 2019, Uber completed the significant landmark of floating on the New York stock exchange at a staggering valuation of $91 billion.

Discuss any structured quality improvement methodology with illustrative examples if a business process exhibits large number of defects which leads to high amount of scrap or re-work

1 a) Will IMPACT really have any impact on how skilled nursing is provided in the United States? IMPACT applies to post-acute care organizations that participate in Medicare, so you will need to identify what types of care and facilities the federal law applies to.

1 b) Assume you are the administrator for a group practice. How would you determine if MIPS or APM is best for the physician practice? Thinking about this course, are there specific financial analysis tools that can assist in making this decision, and if so which ones would you use and why?

1 c) MACRA has now been in existence since 2017 and impacts how physicians are paid under Medicare, whether they are independent of a healthcare system or part of a system. It does replace the SGR that was extremely unpopular amongst physicians. Is MACRA successful in encouraging both quality outcomes and cost effectiveness?

Question 1: Netflix would like to carry out market research to understand the online interactions among fans of its original programming such as ‘Orange is the New Black’ and ‘House of Cards’. Netflix hopes to use these customer insights to understand what aspects of these programmes make them so popular. What research approach would best help Netflix gather this type of information from viewers? Explain your choice. (10 marks – approximately 500 words / 1 page).

The information about Netflix is above

Netflix Case: Netflix Uses Technology to Change How We Watch Videos

When Netflix was founded in 1997 in the United States, the movie rental giant Blockbuster had thousands of stores from coast to coast, filled with video cassettes ready for immediate rental to customers (Pride et al., 2018). Netflix had a different vision from this well-established, well-financed competitor. Looking at the recent development of DVD technology, Netflix saw an opportunity to change the way consumers rent movies. The entrepreneurial company built its marketing strategy around the convenience and low cost of renting DVDs by mail, for one low monthly subscription fee.

Instead of going to a local store to pick out a movie, subscribers logged onto the Netflix website to browse the DVD offerings and click to rent. Within a day or two, the DVD would arrive in the customer’s mailbox, complete with a self-mailer to return the DVD. And, unlike any other movie rental service, Netflix customers were invited to rate each movie on the Netflix website, after which they’d see recommendations tailored to their individual interests (Pride et al., 2018).

Fast-forward to the 21^st century. Video cassettes are all but obsolete, and Blockbuster, once the dominant brand in movie rentals, has only one remaining shop in the US as consumer demand has shifted to digital distribution for entertainment (Porter, 2019). In Australia, both Blockbuster and Video Ezy still had a brand presence in 2018 (Pride et al., 2018). Since then, Blockbuster’s last Australian shop closed in March 2019 (Porter, 2019), and Video Ezy exists in the form of vending machines (kiosks) after its shops closed (Rosenberg, 2018).

Both brands have been prompted to reassess their distribution channels. You may notice more DVD rental kiosks such as “Video Ezy Express” popping up in convenient locations, including outside supermarkets and shopping complexes, in a bid to improve brand reach and accessibility. DVD rental kiosks, like online services, are accessible around the clock and reduce many store costs, including wages.

In contrast, by completely eliminating the need for brick-and-mortar stores or kiosks, Netflix has minimised its costs and extended its reach to any place that has postal service and Internet access (Pride et al., 2018). The company still rents DVDs by mail (Monahan & Griggs, 2019), but it has also taken advantage of changes in technology to add video streaming on demand.

Now, customers can stream movies and television programmes to computers, television sets, videogame consoles, DVD players, Smartphones, and other web-enabled devices. One advantage to the company is that streaming a movie costs Netflix less per customer than paying the postage to deliver and return a DVD to that customer.

Netflix’s Use of Technology: From Data-Tracking to Streaming

Netflix made technology a core competency from the very beginning. Because the business has always been web-based, it can electronically monitor its customers’ online activity and analyse everything that customers view or click on.

With this data, Netflix can fine-tune the website, determine which movies are most popular among which market segments, prepare for peak periods of online activity, and refine the recommendations it makes based on each individual’s viewing history and interests. The company also uses its technical know-how to be sure that the website looks good on any size screen, from a tiny Smartphone to a large-screen television.

A few years ago, planning for a significant rise in demand for streaming entertainment, Netflix decided against investing in expanded systems for this purpose. Instead, it arranged for Amazon Web Services to provide the networking power for streaming (Pride et al., 2018).

By 2018, on a typical night in the US, Netflix streaming occupied up to 20,000 servers in Amazon data centres (Pride et al., 2018). Demand was so strong by that time, in fact, that Netflix streaming accounted for about one-third of all internet traffic to North American homes during the evening (Pride et al., 2018). This percentage is only expected to increase. The Australian market, however, may pose technological hurdles, as the National Broadband Network is still being rolled out and is not available in all areas, meaning that accessibility may not be as straightforward as it is in America (Department of Infrastructure, Transport, Regional Development and Communications, n.d.).

Although Blockbuster and Video Ezy are no longer a competitive threat in their traditional form, Netflix does face competition from Amazon’s own video streaming service, Amazon Prime Video, which headed to Australia and New Zealand’s shores in 2017 (Pride et al., 2018).

Other direct competitors include well-established Hulu, YouTube, Nine Entertainment, and

Fairfax media’s joint-venture Stan, and Foxtel’s movie-streaming service Presto. It also competes with other entertainment providers, including cable, satellite, and broadcast television. Foxtel, for example, has dramatically reduced its basic cable packages in an effort to retain its share of the market in face of increasing competition from on-demand services (Pride et al., 2018).

Netflix Offers Exclusive Programming to Customers

To differentiate itself from its competitors, Netflix commissioned exclusive programming such as House of Cards, Arrested Development, and Orange is the New Black. The cost to produce such programs runs to hundreds of millions of dollars (Pride et al., 2018). Between May–December 2019, Netflix added 179 original programmes to its American streaming service, or an average of 30 new shows a month, or about one show per day (Fruhlinger, 2019). Netflix plans to continue pouring money into exclusive content because of the payoff in positioning, positive publicity, and customer retention.

The way that Netflix releases its exclusive programming reflects its in-depth knowledge of customer behaviour. The company found through its data analysis that customers often indulge in ‘binge watching’ for a series they like, viewing episodes one after another in a short time.

Based on this research, in 2013 Netflix launched all 13 episodes of the inaugural season of House of Cards at one time, an industry first (Pride et al., 2018). Executives gathered at headquarters to monitor the introduction, cheering as thousands of customers streamed episode after episode. By the end of the first weekend, many customers had watched the entire series and shared their excitement via social media, encouraging others to subscribe and watch. When Netflix won multiple Emmy Awards for House of Cards, it was another first—the first time any Internet company had been honoured for the quality of its original programming.

One key measure of Netflix’s growth is the strong increase in the number of monthly subscribers. In 2015, Netflix had about 70 million subscribers worldwide, of which 26 million were located outside the US (Pride et al., 2018). In 2019, Netflix had 151 million paid subscribers worldwide (158 million if free trials are included) (Kafka, 2019).

Despite the brand only launching in Australia in March 2015, it already has close to 2 million subscribers in 2018 (Pride, 2018). By July 2019, Netflix had more than 11.6 million subscribers in Australia, up 18% from the year prior (Gruenwedel, 2019) Its closest direct competitor, Stan, had 2.6 million subscribes in early 2019 (Knox, 2019).

Netflix will not say how many subscribers that it has in New Zealand, but a recent survey of 1,000 people, commissioned by the Office of Film and Literature Classification and carried out by UMR Research, found that 72% of respondents subscribed to Netflix. Of the same respondent sample, 77% said they watched television shows and movies using a paid online service (Kenny, 2019).

Keys to Netflix’s successful launch include offering free-trials and access to stripped-back free versions, as well as continued investment in original programming. It appears that streaming is the new broadcasting, and that ‘on-demand’ spells the demise of scheduled entertainment.

describe all the IT you used to communicate and collaborate with your teammates while working on the group project. They will range from simple forms like text messages and email to more sophisticated means like video conferencing and a prototyping tool. For each form, reflect on its usefulness to you and write a short paragraph about the successes or challenges you experienced using it and whether you got the results you expected.

Please be certain that the stakeholder analysis provided is one for the London taxi business and not Uber -- I have attempted posting this question already however the answer provided was incorrect.

Using stakeholder analysis, analyse the power and level of interest of the relevant stakeholders involved in running and regulating the London taxi business.

Guidance notes:

In Sessions 2 of Block 3 you encountered the concept of stakeholder analysis, as a key part of analysing the political context. In particular, Activity 2.1 and Reading 4 discussed some of the theory supporting stakeholder analysis and gave you the opportunity to undertake a practice exercise. The stakeholder analysis framework shown in Reading 4 Figure 1 may help with your answer.

The second part of Question 1 requires you to look at some of the employee relations issues that are taking place at Uber. Block 3, Session 4, introduced you to the idea of inclusive and participatory employment relations. In particular, Reading 6 discussed the importance of employee ‘voice’ and why voice matters in modern organisations. Block 3, Session 5, discusses the issues of flexible working and employee empowerment. Activity 5.1 looks at the importance of involving employees and suggests ways this might be achieved. Your answer should draw on appropriate concepts and theories from Block 3 together with suitable evidence from the case study to support your arguments.

Case study:

Technological challenges in the taxi industry

Uber is a technology company that offers a free programme, or app, available on a mobile device for those wishing to request a ride. At its core, Uber seeks to match passengers to drivers. The platform is able to track a user’s GPS coordinates, even if the user does not know where they are, and within minutes an Uber driver will arrive. The user is able to track how long until the ride will pick them up and receives a text message confirming when the Uber driver is arriving. The driver is able to hit a button on their own app that says ‘Arriving now’ which sends the text message. No cash is exchanged when using Uber since signing up for an account requires providing credit card information. After the ride, Uber charges the user electronically and immediately emails them a receipt. There is a rating system so that passengers can rate their driver and vice versa (Dong et al, 2014).

According to Uber, the company ‘pushes the limits of the transportation industry to create a simple, more efficient, and more enjoyable car service experience. For drivers, Uber is a revenue stream, allowing professional drivers to make more money by turning downtime into profits.’ (Uber, 2016). Unlike the taxi industry, Uber does not employ or license its drivers, but rather views them as independent contractors. The unique experience provided by Uber has enabled rapid growth and international expansion centred on three main focal points: a commitment to on-demand service, an efficient supply of luxurious rides, and the easy accessibility of its smartphone application.

Uber’s growth over the past five years is an example of a major success in what is known as the ‘sharing economy’. The sharing economy is an economic system where assets or services are shared between private individuals either free or for a fee, typically by means of the internet. However, the success of this new business model is attracting criticism from government and civic leaders concerned that this new ‘collaborative economy’ is simply a means of sidestepping regulations, taxes and other legal obligations. These ‘gig economy’ apps have been criticised for failing to provide traditional employee rights such as paid holidays and in-work insurance.

The size of the UK taxi and private hire market is estimated at £9.4 billion. The industry is mature, with high levels of revenue volatility, technological changes, and high competition with low barriers to entry (Skok & Baker, 2019). In London, Uber’s growing popularity meant that their drivers completed some £115m of business within London (Quinn, 2016). However, Uber London (the taxi app’s UK holding company) recorded only a sales take of £23m and a profit before tax of £1.83m. The sales figure reflects only Uber’s share of fares for trips booked on its app. In addition, Uber London retain 20% of any fare to the driver. Despite this Uber London paid just the small sum of £411,000 in UK tax last year.

Concerns have also been raised over driver working conditions, particularly regarding claims that some drivers are doing excessive and unsafe hours.

Some Uber drivers are working up to 21 hours a day to make ends meet as the company increases its cut of fares and fights a ruling giving them employment rights. Drivers in London interviewed by The Sunday Times told of regularly working hours that Uber itself describes as ‘unsafe’. The newspaper has seen official Uber documentation proving one of the men worked a 91-hour week. The disclosures come as new figures show a dramatic rise in casualties involving taxis and private hire vehicles in London.

In interviews with 12 Uber drivers waiting at Heathrow, three admitted working 16 hours or more a day. Tom, from High Wycombe, said: ‘On average every day [I work] 14 hours, and 16 is top whack. I had a colleague last week who said he had worked 19 hours. I know people who even sleep in the car, and they go crazy … I can start at six o’clock in the morning and finish the following day at maybe two o’clock, three o’clock,’ – a 20 or 21-hour day.

A second driver, Peter, said: ‘Recently, Uber cut rates per mile by 25%. Now I’m having to work longer and longer hours in order to pay my rent. I want people to know how powerless you feel when your income comes from a faceless app and when you open it up one morning, things are just different and you’re earning less money and there’s no boss you can talk to, you weren’t told about it, you just see your income is lower today and you just have to deal with it’. A third Uber driver, Khaled, said ‘We need to speak the truth. I work 70-80 hours a week and weekends it’s 14-16 hours a day. There are plenty of days where, minus petrol, I make less than minimum wage. It’s very, very stressful but I don’t have a choice. I feel like I’m a slave; we work like slaves for this company. I wish I knew what I know now earlier,’ he said. ‘I was blindsided. If I knew about the expenses, just how expensive it is to do this gig, then I wouldn’t have gone into it in the first place’. The legal limit for a bus or lorry driver is 56 hours a week.

Another Uber driver, Razak, said: ‘Once Uber got control of the market, they changed in the worst ways. When I started I made 80% of the fees from my fares with 20% going to Uber. Now they are charging anything they want, sometimes taking as much as 60%. All drivers are asking for is fair pay, and that’s what Uber won’t give to us. They are not willing to be transparent. They are willing to change the logo, they are willing to advertise, to spend millions on lobbying, but they are not willing to pay the drivers fairly. Uber treats drivers as just something they have to deal with until technology for autonomous cars gets to the point where they can eliminate drivers all together. They don’t listen to us’. Three other drivers could not be interviewed because they were asleep in their cars. One had installed curtains in the vehicle.

Figures published in 2016 by the London transport regulator, Transport for London (TfL), show there has been a 26% rise in casualties among taxi and minicab passengers during the previous year. The number of passengers killed or seriously injured rose from 13 to 20, a 54% rise.

However, Uber UK said it had no plans to limit driver hours. In London, for new drivers, it has increased the cut it takes on fares from 20% to 25%, forcing them to drive for longer to earn the same money.

The company suffered a blow in 2017 when an employment tribunal ruled that Uber drivers were not self-employed, and were entitled to holiday pay, pensions and other workers’ rights. In 2018 it appealed against this ruling but lost. The Appeal Court judges found there was a “high degree of fiction” in the wording of the standard agreement between Uber and its drivers. The judgement went on to state that “For Uber to be stating to its statutory regulator that it is operating a private hire vehicle service in London and is a fit and proper person to do so, while at the same time arguing in this litigation that it is merely an affiliate of a Dutch-registered company which licenses tens of thousands of proprietors of small businesses to use its software, contributes to the air of contrivance and artificiality which pervade’s Uber’s case.” (Butler, 2018). Uber is appealing this latest judgement.

Steve Garelick, of the professional drivers’ branch of the GMB union, said: ‘Through the app, Uber knows precisely how long everyone has been available. It and other operators could stop this overnight if they wanted to. They’ve made the effort to limit hours in New York, so what’s wrong with London?’ Tom Elvidge, general manager of Uber London, said that three-quarters of Uber drivers in the capital were logged in to the app for less than 40 hours a week. ‘We regularly advise drivers to take rest breaks’ he said. ‘We take this issue very seriously and are always looking into ways to improve the overall safety of the app.’

Uber London actively resists attempts by TfL or other government agencies to bring in any regulation of its services, or to bring its service into line with the historic business practices of London’s historic black cabs. The European Parliament has approved new minimum rights for workers in ‘gig economy’ jobs, including Uber drivers. Under the European Union (EU) regulations, casualised employees across Europe will have a right to compensation from their bosses for last-minute cancellation of work, mandatory training will have to be provided free of charge, and ‘exclusivity clauses’ that ban workers from taking other jobs will also be banned. The UK could end up following EU rules at this point if the Brexit transition period is extended, meaning the rights could apply to workers in the UK. However, if the UK leaves the EU earlier, employees will not benefit from the rules and will probably be exposed to harsher employment conditions (Stone, 2019).

In 2017, Uber was rocked by a former employee’s devastating assessment of her time working at the company. She detailed several instances of sexual harassment and a culture that did not welcome women. In response, Uber launched an investigation involving more than 100 ‘listening sessions’ across the company. The report concluded that ‘The focus of the company had been on the business and not the employees’ and that the atmosphere at the company had created a ‘cult of the individual’ (Lee, 2017).

London’s taxis are responding to the technological challenges presented by Uber, and TfL announced last year that all black cabs in London would be required to take credit cards and contactless payments from October 2016.

Groups representing taxi drivers said the decision by TfL would benefit both drivers and customers. The move by TfL’s board followed a consultation in which it received support from 86% of respondents.

‘Every black cab taking cards is fantastic news for London. In future, when you hail a cab you can be sure that you can pay the way you like – card, contactless or cash. That is without doubt better for our customers and for drivers who will benefit from extra work,’ said Steve McNamara, general secretary of the Licensed Taxi Drivers Association.

The move towards mandatory card payments in black cabs is part of wider changes by London’s 22,500 cabbies in rising to the challenge from Uber. For example, some black-cab operators are fighting back with smartphone apps of their own, such as Hailo and Gett. Gett offers discounts on metered fares for journeys of six miles or more and those made in off-peak hours. Hailo allows Londoners to get a taxi through their smartphone.

Remo Gerber, chief executive of Gett UK, said: ‘This is another strong sign of how the London black cab trade is embracing the future; not only have cabbies embraced apps, but everyone is behind making card payments universally accepted and by that making all journeys easier for Londoners.’

The firm’s application for a new licence in London was rejected in September 2017 on the basis that the company is not a ‘fit and proper’ private car hire operator. At an appeal, a court decided Uber should be awarded a 15-month probationary licence to operate in London after the ride-hailing service promised improvements. In May 2019, Uber completed the significant landmark of floating on the New York stock exchange at a staggering valuation of $91 billion.

Enumerate at least five specific entrepreneurial aspects to include in a strategy formation process.

NB: PLEASE EXPLAIN THE 5