Introduction
A decade ago, two women came up with an environmentally friendly idea to deliver rental cars within the neighborhood at affordable costs. Years later and still run by the founders, the ZipCar realized it needed a new face to salvage it to profits. This paper is on how that new face transformed a company that was coping with the economy, to one that the economy coped with.
The Overhaul Process
Scott Griffith first took time to analyze demographic data on the industry. He believed in numbers, ratios and performance metrics. ZipCar had them. He detailed problems facing the company, halting all scheduled expansion plans. Available resources were directed to zones created within the cities. Using financial models he’d drawn up, ‘Pods’ of Zipcars were availed to the required number.
An upgrade of ZipCar’s system was also prompted to catch up with the new development. The target group was then expanded to include high end members with the addition of BMWs and four-wheel-drives. “The big breakthrough came when he put city managers in charge of their own profit and loss, and encouraged them to approach their cities as they saw fit” (Clifford, 2008). Managers now competed to prove who was best among them. It worked in favor of the company.
While the managers locked horns, Griffith targeted the risky under 21 group by striking deals with schools. He struck gold. During this success period, Benchmark Capital offered $10 million in venture capital, which Griffith used to expand to Toronto. Scale being good for business, ZipCar acquired rival Flexcar. Now valued at $100 million, from a meager $2 million back in 2003, with a new target of $1 billion, ZipCar puts Griffith in shoes akin to those he started with, a fact he acknowledges and strives to achieve.
The managers’ Objectives
Now under new management, ZipCar managers expected a new form of administration in the company, though they were unsure what shape it would take. They first had to take on their managerial roles and avoid involving in responsibilities delegated to low end employees i.e. taking of customer-service calls by the Vice President of marketing.
They were then mandated the task of managing their own Profit and Loss accounts in accordance to their zones’ status as long as it brought returns at the end of the day. They risked losing their respect from fellow managers, funding from the company and losing out on the bonuses set for those who attained set goals.
Success Story
Scott Griffith is a success to ZipCar for his role in the growth of a neighborhood company that was wallowing in losses before he joined it, to a multimillion dollar international company with global ambitions.
Applied Techniques
As he entered the company, Scott Griffith had an advantage as it already had recognition in 3 major states. Data mining helped in conducting deep research on the industry he was about to plunge into. Decision analysis brought about the zoning idea and growing outwards from there.
Probability and statistics enabled him to venture into the new target groups that included the top brass and students respectively. Revenues from those moves prompted him to use his project management skills in optimizing on his global ambitions, which led to his choice of Toronto, Vancouver and London.
References
Clifford, S. (2008). How Fast Can This Thing Go, Anyway?INC Magazine. Web.