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MSCI-2130 : Introduction to Management Information Systems - Disrupting the Roadside Assistance Industry Case Study - Management Assignment Help

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Case Study Disrupting the Roadside Assistance Industry 

Roadside assistance is a $10-billion industry in the United States, encompassing a range of services including accidents, dead batteries, flat tires, towing services, tire services, fuel services, and locksmith services. Today, the industry faces disruption from technology companies that are replacing call centers with algorithms that dispatch the nearest vehicle to help a driver who is locked out of his car or to winch a car out of a ditch. These companies provide an on-demand alternative to paying for insurance plans that drivers might not use or to having to call a tow company without knowing how much it charges. 

Two of these companies, Urgent.ly (http://urgent.ly) and Honk (www.honkforhelp.com), offer flat rates, promise quick response times, and provide maps in their apps that display the location of the company vehicle, with real-time updates. The companies do not charge annual membership fees, unlike the American Automobile Association (AAA; www.aaa.com). 

Customers are not limited to particular tow-truck operators. The companies call the closest service vehicle to the customer, which can arrive in less than half the time and cost up to half the amounts charged by industry competitors. A basic roadside service costs $49. Before users click for service, they are informed in advance of the total fee, which they pay via credit card. 

These app-based roadside assistance services also benefit tow-truck drivers, most of whom work as independents or for small operators. The traditional towing industry relies on receiving bookings from a central dispatcher, such as the AAA. Those drivers get an average of $23 per call, even though customers are typically charged $200. Drivers for Urgent.ly and Honk earn nearly double the traditional fee, mostly because these services don't need call centers. These drivers can also complete more calls in a day because the apps use algorithms for dispatching and the drivers use GPS-enabled smartphones. 

 

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