EHS Management

How to Share in the New Economy

In kindergarten, we learned sharing was good and that we would be rewarded for offering a bit of our abundance to others. Today “sharing” is used to describe a whole new economy. That is, sharing our houses, cars, and even clothes with others has not only become the norm but also very good business.

Bit by bit, the sharing economy has crept into our way of life. Uber and Lyft have quickly become alternatives to taxis or driving ourselves. Similarly, just a decade ago, the concept of spending a vacation in someone else’s house was something we did only with our closest friends. Today Airbnb is a popular alternative to a hotel stay. Plus, there are other perks, such as (usually) enjoying a larger space than offered by most hotels, (generally) lower prices, and the opportunity to experience a taste of how “real people” live in a different location.

Technology provides the boost needed to propel the sharing economy to new heights. With push-button ease, we can make extraordinary connections across the globe. Within seconds, a home owner in New York can offer her apartment to a businesswoman in Morocco planning her next vacation. A harried parent across town can have a stranger pick him up in his Toyota within minutes.

While the sharing economy definitely has its disadvantages (more on that tomorrow), there are obvious benefits that will keep this mode of transaction strong for years to come. The prospect of sharing what is currently unused is particularly attractive to those who seek a green, less wasteful lifestyle. Additionally, sharing businesses tend to be less expensive as intermediaries are eliminated in the exchange.

If you’re pondering a jump into the sharing economy, there are a few important considerations:

Create value: Whatever your “sharing” idea, it must create value for all involved. Airbnb works because homeowners make use of their unused space, and travelers have an economic alternative to hotels. Uber drivers offer up their cars to earn money while providing more inexpensive transportation. Spinlister lets bike owners earn passive income and provide their wheels to other people craving exercise.

Break the rules: Undo the services that seem inextricably bound up in inconvenience. It used to be that if you got sick, you’d have to wait to see a doctor—maybe days or even weeks. Now there are online services that will instantly connect you to a video conference with a physician, many of them moonlighting to provide a convenient service. Similarly, need a writer, videographer, or graphic artist? Forget the employment agencies.  In the sharing economy, you’re instantly connected with skilled people through multiple online sites.

Get the technology right: Be realistic. The magic of online connection is costly. Investing in “app” technology is expensive and time-consuming. But this piece of the business model is essential. Consumers are far too demanding to be bogged down by buggy technology.

Hire the right people: Customers expect excellent service from a company that’s offering an alternative, and if they don’t get it, they’ll go right back to the traditional way of doing things. That means you must search for employees who are extremely service-oriented.

Be transparent: A fact of life in the sharing economy is that your customers will also want to share their thoughts about your business. Provide the opportunity for them to rate your performance. It may be a bit nerve-racking at first, but ultimately, being transparent is good for gaining customer trust.

Build a community: Sharing has a social side to it. Help bring people together not just by providing a service but also by encouraging friendly interaction. Developing a community of users is also a great way to build your brand.

Don’t want to dive in completely? Augment your business with sharing opportunities. For example, a vet hospital may consider offering a shared dog-walking service. A hardware store can facilitate handyman-sharing services. The possibilities are out there.

Of course, not all sharing enterprises are successful, and some have drawn strong criticism for everything from stingy wages to exorbitant fees. Tomorrow we’ll consider some of the pitfalls of sharing in the success of the sharing economy.

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