Unassailable moats no more

As I got out of the cab at the airport, I felt something sticky on the back of my jeans. I reached behind me only to realize that I had been sitting on a wad of chewing gum throughout the cab ride from Manhattan.

If you have ever taken a ride in a New York City Yellow Cab, you know that user experience is, let’s say, subpar. Drivers are often in a hurry, and it isn’t uncommon for passengers to fear for their lives or the lives of pedestrians on the road. Speaking to drivers is difficult through the thick glass barriers separating them from passengers. And even if you manage to speak to your driver, it usually won’t be a pleasant conversation. Routes and fares seem to depend upon the phases of the moon.

It was not that long ago that Taxi companies all across the world were waging war against Uber. In New York City, the battles were particularly fierce. They joined forces with the unions and politicians to turn public opinion against ride-sharing companies. Ultimately, they failed. A New York Taxi medallions to operate a taxi used to cost close to a million dollars in 2013. Today it’s available for around $150,000.

London cabbies also fought against Uber, but unlike New York, they’re faring well against the digital upstarts. Is it because London roads are notoriously difficult to navigate giving professional drivers an inherent advantage over the part-time drivers? Perhaps, but there’s more to it. Let’s sort out what else is going on and see if there are lessons for us to learn:

Uber advantages:

1. Passengers know who is picking up; when, where, what type of car.
2. Driver doesn’t worry about what route to take.
3. No language or currency issues.
4. An expected courteous interaction because of the mutual rating system

London Cab advantages:

1. New York City Taxi cabs have enough space to play ping-pong in the trunk along with your luggage, but you get claustrophobic up against the glass partition in the back-seat. In contrast, London Cabs are purpose built and always have plenty of space to sit and stretch. They have a bi-directional speaker system, security camera, auto-lock, and headroom designed to make a traveler feel at ease
2. Drivers are professional. Even before Uber, London Taxi drivers were always courteous. They spoke when spoken to (unless you start a conversation about football, in that case all bets are off) and were always happy to help with any questions about the city.
3. London roads are hard to understand and navigate even with Google Maps: Taxi drivers need to pass a very difficult test to receive a permit and be allowed to operate a cab. Get into a Taxi in London and tell the driver where you want to go – she will get you there safe and sound. Maybe she will open a map book once in a while, but most of the time, she will get you there no matter how small the alley is. (Some of the roads seem just wide enough for one person to walk.)
4. London cabs are everywhere and are very easy to spot with their distinguished shape and lights.

London cabbies didn’t sit on their inherent advantages. They saw that Uber was changing consumer expectations, and they both adapted and evolved. Today, you can download an app and pay for the cabs just like you do for Uber. No, scratch that. They have more flexible payment options than Uber. If you are a visitor from China or Japan, you can now use e-payment apps like AliPay, or WeChat Pay, or Line to make your payment.

This is why while I prefer to Uber in New York City, but I definitely opt for a Taxi cab in London.

ADOPTING TO DEMAND FOR CUSTOMER PERSONALIZATION

Warren Buffet talks about the importance of building a moat – some type of unassailable competitive advantage. All enduring global companies have built moats that include inherent advantages such as:

 ·    Trust and brand loyalty from customers they accrued over many years of hard work.

·     Human experience accumulated over many decades.

·     Knowledge of local markets across multiple continents.

·     Leadership lessons and culture honed over ups and downs of economy.

Moats enabled many companies to survive the great depression and both world wars. But the transformation that’s happening around us today is unlike anything we’ve seen before. A great brand is no longer enough. Customers want a personalized experience.

Standing still isn’t an option even for the largest of companies. Whether in insurance, banking, healthcare, manufacturing, telecom, or retail, new-age competitors born in the digital era are coming at the incumbents. And they’re armed with superior analytics, enabling outcome-based pricing models and consumer humanization.

At ThoughtSpot, we believe that the amount of data created by a modern business is way too much for direct consumption by humans. As amazing as London taxi drivers are in memorizing all of the city’s roads, there is no way they could compete against the scheduling and payment capabilities of the Uber application on their own.

The old ways of doing BI and visualization need to give way to an AI layer that can curate and make consumable chunks of accurate, relevant insights available for humans to make business decisions; decisions that will trigger personalized actions for their customers. This AI layer should be easy enough for business users to work with directly, yet intelligent enough to learn from each human interaction and get continuously better at providing a better product or service experience.

Leading companies can use these AI-powered insights to combat the new digital competitors by also leveraging their advantages in brand, experience, knowledge, and culture.

There’s already a backlash brewing against the digital native companies with respect to how they use consumers’ personal data. Instead of forcing consumers to a Faustian bargain between privacy and delightful experience, now is the time for enduring global leaders in the industries like finance, insurance, and healthcare to step up and offer consumers both; delightful, personalized experience AND data privacy.

But that won’t happen unless they modernize the business operations stack when it comes people, culture, organizational structures, and data analytics.

 Let’s ponder that during our next taxi ride in the beautiful streets of London. 

Follow me on Twitter --@sudheenair

<A quick note of Thanks to Steve, for his help review and edit>