What it is: Uber connects drivers with people who need rides through mobile phones.
If you want to look for innovation, all you have to do is look at Uber. The idea is deceptively simple, but couldn’t exist without mobile phones, especially mobile phones that can install apps.
The basic idea is that you use your mobile phone to call for a driver. Within minutes, someone picks you up and takes you where you want to go. Then all payment is charged to your credit card so no money changes hands.
This works in two ways. First, drivers have an incentive because they can make money defining their own hours without the expense of leasing a taxi. They get in direct contact with customers without the need for a taxi call center to direct them to an address.
Second, riders have an incentive because Uber rides are usually much cheaper than taxis and often arrive far faster than taxis. When both drivers and riders have an incentive to use it, Uber wins by attracting more customers.
To further increase the number of people trying Uber, Uber offers a special code so existing Uber users can give it to new people. This code makes the new person’s first ride free and also grants the giver of the code a free ride too. In this way, Uber grows through the dual incentive of current Uber users and potential Uber users. Once you try Uber, you’ll realize how convenient it can be compared to taxis.
Uber is innovative because it basically replaces taxis by giving both drivers and riders more control. Without mobile phone technology, Uber could not exist, so if you’re looking for a new business to start, look for creative ways to use new technology to replace something that’s a problem.
In the world of Uber, the problem was that taxis were slow to arrive and expensive to use. For taxi drivers, the problem was that they had to lease a taxi and then work a fixed shift with little control of their own hours.
Uber solved the pain points of both riders and drivers by relying on new technology. That’s innovation because it couldn’t have happened without mobile phone networks. Uber could never have survived in the early days when mobile phones were expensive and hardly anyone could afford them. Uber can only survive once mobile phones became commonplace so nearly everyone could afford one.
Innovation always solves current painful problems and kills the old solution (taxis). If you want to see if something is innovative or not, just look to see if it kills some existing solution and if it relies on something new to give people power they didn’t have before (mobile phones).
Innovation isn’t just adding a kickstand to a computer (Microsoft’s Surface tablet). That’s an incremental improvement, but not innovation. Innovation yanks us out of our current world into a whole new way of life. Incremental improvements are familiar enough to keep us grounded in our current way of life.
You want both, but the real future lies with innovation, and that’s where you want to be tomorrow.