The Resource-Based Overview Of Mobike Company

In this report, the internal resource of Mobike and its competitive advantage, and disadvantage are presented. Mobike, who provides a dockless bike sharing service has been expanded its service area rapidly in several years, and there should be reasons and factors why the company succeeded in the competitive market. In the beginning sectors of this report describe the background and basic information about Mobike. Then, the company’s resources are analyzed with the resource-based view (RBV) Theory. RBV is an approach to analyze the company’s internal resources rather than external factors in order to find strength, weakness, and competitiveness in the market.

There are both competitive advantages and disadvantages are found and discussed in the sector. It is hoped this study will help people in IT and business sectors understanding the position of Mobike in the sharing economy market.

Introduction

The resource-based view (RBV) is a business model of analyzing company resources to evaluate a company’s competitive advantage and its position in the market or industry. Competitive advantage is the aspect a company has over its competitors. Using RBV, the attributes of a firm’s resources, including whether they are tangible or intangible are considered. This analyzing method is an inside-out approach, which means that the beginning point of the analysis is the internal environment of the firm. With the appropriate resources, firms can obtain long-term competitive advantage. In this assignment, the implementation of the RBV approach for Mobike. com is argued. Mobike is a company providing the dockless bike sharing platform. Although the company was just founded in 2015, the range of area supporting their services expanded rapidly and now their bikes are running over 15 countries. There must be the reasons and competitive advantages why Mobike succeed their business, and RBV approach is used to analyze whether or not they are valuable, rare and inimitable.

According to Mobike. com, Mobike is a company providing a fully station-less bicycle-sharing system established in Beijing, China. There are several firms supporting the dockless bike sharing platform, yet Mobike has the largest number of shared bicycle operators in the world. The area supporting their service is expanding expeditiously. Singapore is Mobike’s first foreign market, started in March 2017, then its service launched in Australia in January 2018 and now used in over 200 cities in 19 countries. One reason why the company has a huge amount of share is its ease of use. Once users open the app produced by Mobike. com, they see the map and location of bikes near they are at. It shows the direction to the location when users tap on a bike icon on the map, and they can book the bike for 15 minutes to make sure they take it when arrived at the destination. The lock on the bike can be opened by scanning the QR code on it and then the bike is ready to use. After the riding trip is done, they can park the bike at any bicycle parking spot or rack. Finally, the app notifies them the trip details and bill immediately and all processes are done. In order to encourage people’s cycling behavior, a scoring system is implemented in the Mobike community. The score is reduced by not taking ride responsibly and considerately like disobeying traffic rules, parking in an inaccessible place, using the personal lock to the bike. If operators reduced the score, they are required to pay more fee than normal riders. This is how the app provided by Mobike is used and the company is still growing rapidly on a global basis.

Resource-based Theory

“The Resource Based View (RBV) analyses and interprets internal resources of the organizations and emphasizes resources and capabilities in formulating strategy to achieve sustainable competitive advantages”. It is a framework used to give an overlook of the company’s resources and exploit them to gain a competitive advantage. It emerged during the 1980s and 1980s by works published by Barney. J, Wernerfelt.

Resource based theory focuses on using the resources inside the business to gain a competitive advantage then looking externally in the competitive environment. It argues that resources strategies would gain a stronger competitive advantage than other strategies.

RBV relies on resources that are either Tangible or Intangible. Tangible resources are the physical assets that a company own such as land, products, capital while intangible resources have no physical presence but are still owned by the company such as their trademark, intellectual property etc. Once resources are differentiated if they are tangible or intangible, they resource are checked heterogeneous or immobile. Heterogeneous means that company skills, products and other resources the company owns is differentiated from other companies. By being differentiated, the company can develop unique strategies that will allow it to compete with other companies, otherwise having the same amounts of products will be difficult for the company to implement different strategies. Immobile means that the company resources are static and do not move from company to company, so company’s resources cannot be imitated. To provide a competitive advantage, Barney has point out four indicators on how the company resources can achieve this. The resources must have the following attributes:

• Valuable: This improves their efficiency and effectivity once implemented due to their quality.
• Rare: Resources that are possessed by large number by companies makes it difficult to attain competitive advantage.
• Imitable (Imperfectly): Resources that are hard to imitate allows for uniqueness.
• Organized: Resources shouldn’t be comparable, so other companies cannot gain an advantage.
• Competitive position of Mobik

IT Asset (Tangible resources)

he company is investing a large amount of money on their bicycles like design and functions, as they are essential infrastructure for the business and competitiveness. Every bicycle equipped an internet-controlled electronic wheel lock which unlocks the key on the bike automatically. Details of the equipment on the bicycles are described later in this report. There are two versions of bicycles implemented in its business; Classic mobike and Mobike Lite. Both versions of bicycles are used by the same process by renters, but the equipment, design, and concepts are different. The classic mobike is the basic type of their bicycles, which consists of all-aluminum material, V-shaped chassis, airless tires, and a shaft transmission system. In order to improve robustness and lower maintenance costs, five sets of two thick, parallel, metal rods are used instead of standard wire spokes. The QR code is shown at the base of the handle, as well as on the smart lock. The weight of classic bicycles and the lack of bicycle basket are the major concerns for user satisfaction. To address the concerns over, the company developed the second generation of bicycles called ‘Mobike Lite’. Wire spokes and a standard chain drive systems are implemented to adjust the weight, and baskets are equipped on the bikes.

Based on these information, it can be seen that the value of bicycles are high in their company, as the functions of bikes are designed and specialized in the business. In addition, imitation of the bikes is not very easy for competitors because the design is patented.

Smart Mobike Preferred location

Smart Mobike Preferred Location (sMPL) is a model upgraded by Mobike and Baidu Cloud. It quickly and accurately locates the parking position and status of bicycles through precise positioning algorithms. sMPL enhances the management and control capabilities of Mobike. With the help of technology, users are able to pick and place bikes more convenient and efficient. And users who are compliant parking will be awarded. This method of guiding “civilized parking and green travel” through the intelligent technology of recommending parking location is first introduced by Mobike within the industry. Smart Mobike Preferred Location has been designed with the color of black and orange which are symbol color of Mobike bicycles. It is equipped with solar electricity supply system providing lasting and green energy. SMPL is designed with the motivation of green, low-carbon and environmental-friendly lifestyle. There are three functionalities which are “easy to pick up”, “regular parking”, “orderly management” to be upgraded with the appearance of sMPL. Baidu Cloud uses smart IoT technology to locate available bikes with data near sMPL and transfer data from bikes’ information management base to Baidu Cloud so that users can get information of bike with location such as meters and directions. Therefore, it further enhances user experience and guides orderly parking of shared bicycle industry. Hence, the value and rarity is high because Mobike is the first bike sharing platform to attempt smart parking location. Other brands of bike sharing platforms are easily to create the same infrastructure because easy imitation and they are able to replace original parking lot to smart parking lot. Equipment on bike(lock, GPS, GPRS, electricity supply)The patented smart lock with QR code is the core parts of Mobikes’ equipment. When a renters read a QR code with a mobile device to unlock a bike, the system validates the image to the one stored in the system to determine if they are identical. Unlock request, including user’s data and the information about the bike, is sent to the cloud server and then the cloud check if the user is qualified. When they are verified, the components of the smart lock rotates the shaft and drives the latch driving member to remove the lock tongue from the locking pin. In addition, each bike connects to their own network via the GPS-embedded smart lock, and a mobike SIMs enable locating a bike accurately on the map through the app. The tracking technology allows 24/7 visibility for the local operators and employees to make sure bicycles are strategically placed in high-demanded areas, and will also alert the operators when bicycles are relocated improperly.

The original version of mobike bicycles relies on labor which makes riding experience laborious. However, the newer generation of bikes is equipped with solar energy technology. In the front frame, a solar cell is placed and supplies the smart lock with electric power. Therefore, the users’ riding experience became richer and the company does not need to place any electric charging station. As the smart lock technology is patented, it would be difficult for other competitors to develop a similar system which processing unlocking with a QR code and a smartphone

Mobike uses Baidu WangPan cloud as its cloud server. Baidu WangPan is an Iot (Internet of things) server that was released in 2012 in Beijing. Iot is a server that collects, analyze and process data in real time and in the cloud. It creates a network of physical devices, electronic devices, home appliances with electronics, systems, cloud allowing them to exchange and collect data. It is very efficient for Mobike as Mobike resources are constantly transferring data to the server. Since Mobike’s bike are constantly shifting locations onced used by consumers, Iot allows the bike to directly send its GPS location to the cloud which then gets recorded in the Application, thus allows the users to know which bikes are available and which bikes are located close to their proximity. Another efficient use of Iot in Mobike is monitoring. Since Mobike products are constantly being used and are left in different locations, knowledge about their availability of bikes, where they are primary used and where there current position can be beneficial for the mobike employees in terms of management. Through monitoring, Employees can know which area requires has the most quantity of bikes. Another benefit of Iot is that it provides more accurate results and data and much more rapidly. Due to machine-to-machine interaction, data transfers are now more quicker and accurate, benefiting both application for users and employees, saving time and better efficiency. Lastly the main benefit and advantage of Iot is that it saves a lot of revenue for mobike. Since Iot allows for direct data transfer of GPS, monitoring and tracking of mobikes requires no additional hardware to perform those functions.

IT Capabilities (Intangible resources)

As for hardware on bicycle, Mobike bicycles has been developed and released several times of the first year. Each time, there are some changes made on bicycles to provide better comfort for users, which earns a good reputation among users. In the biggest competitor Ofo application, users are required to unlock the bicycle manually with 4-digit code sent by Ofo application. This mechanism used in Mobike saves users’ time to start using and return bicycle. From 2016 to 2017, there are 5 generations of Mobike bicycles. For each generation, a few changes have been implemented and new features all added to the bikes. Hence, the value of hardware innovation and rarity is high. Compared with other platforms, Mobike always keeps its innovative ability to design up-to-date hardwares and optimize user experience, leading bike sharing industry to be mature. Mobike not only develops hardware innovation, but also designs hardware management methodologies such as sMPL (Smart Mobike Preferred Location). It is hard for other platforms to perform innovation like Mobike because of different assets and business process.

In terms of software, Mobike application has been upgraded in several versions. In the beginning, the only functionality of the application is unlock bikes. Up to now, more functionalities are to be completed such as bike reservation, parking regulation and calories consumption. Based on big data infrastructure, considerable users and IoT technology, Mobike has designed a smart dispatch platform to help bike sharing. Mobike created reservation functionality within the application. Open the application, users are able to see the nearby bikes with a icon and they can click the icon to open reservation page. For each reservation, the bike will be reserved for 15 minutes and other users cannot unlock the bike unless the reservation has been cancelled. In the recent days, Mobike introduced a new technology which is unlock bike without scanning code and they called it as fast unlocking. What users have to do is to open bluetooth and Mobike application, then they put their phone close to the bike. The bike will be unlocked automatically. This measure enhances convenience to unlock bikes and avoids the bikes whose QR code have been damaged. The value and rarity of Mobike software innovation is high because of they always lead the industry to bring more convenience to users and guide the industry with how to build a successful bike sharing platform. But for other platforms, it is difficult to imitate and substitute the innovation because its IoT industry and software is always updated with hardware.

Up to now, Mobike service has been provided in China, Singapore, the United Kingdom, Italy, Japan, Thailand, Malaysia, the United States, and South Korea. There are more than 7 million Mobike bicycles providing smart travel services over 180 cities. 200 million users are using Mobike and the daily orders exceed 30 million which makes Mobike become the world’s largest intelligent shared bicycle operating platform and mobile Internet of Things platform. More than 30 TB of riding data is generated each day within Mobike company. It provides a scientific reference for the planning of smart cities, healthy cities and low-carbon cities because of the comprehensive data of Mobike. Compared with other similar platforms, Mobike bicycles has better quality and more convenient method to lock and unlock bicycles. However, the price per use is almost the same with other platforms. Therefore, those elements earn a good reputation for Mobike and consumers are more likely to choose Mobike when cycling.

Cooperation

To sustain competitive advantage and grab the intensive market share of bike sharing industry, cooperation is vital for platforms. Mobike cooperate with Tencent in Wechat application. Then Competitor Ofo cooperate with Alibaba in Alipay application. Users can plug in Mobike within Wechat and use Wechat wallet to pay for bills in Mobike. Wechat now is the biggest social application in China and Alipay is the biggest payment platform in China. Both cooperation contribute advertising and make it more possible for normal people to use those plugin applications because they do not have to download the application when they want to use it and they can pay it using the money already topped up in Alipay or Wechat. Mobike cooperate with Baidu Cloud to launch a project called “smart Mobike Preferred Location”. Based on big data, users can pick and place bicycles more conveniently with an accurate location. In June 2017, Tencent raised $600 million and invested the fund in Mobike, leading Mobike’s fund raising to approximately 1 billion US dollars in 2017. Meanwhile, Mobike was valued at 3 billion US dollars. On April 3, 2018, web company Mei Tuan paid a total of 2. 7 billion US dollars in the acquisition of Mobike.

Cooperation is existed in every company and the value of cooperation is high in almost every company. But not every company can cooperate with the biggest social platform such as Alipay and Wechat. Mobike, as the first company to enter into bike sharing industry using smart phone, has attracted public attention and got helps from government. It is much easier to get cooperation for Mobike than other platforms.

Conclusion

The RBV business model is an effective model of analyzing the company's resources to see where the company can achieve competitive advantage amongst it competitors. It looks into the resources througharly and see what makes the resources attributes unique and differentiated from other competitors and how they can use the resources attributes to give them a competitive advantage. Mobike, a dockless bike sharing company, is rapidly expanding, operating in 15 countries. Through RBV mobike resources were analyzed and studied on how can they achieve and sustain competitive advantage. Their tangible resources strength are their bikes along with their equipment and their intangible strengths are Hardware and software innovation along with their relationship skills. All these strengths pave way for Mobike to achieve competitive advantage.