'€œChange is the only constant in life,'€ said the famous Greek philosopher Heraclitus. However, transportation companies in Indonesia are fighting change instead of adapting and finding the right business model for them to continue to grow in this new digital era.

In the era, more and more goods and services are being sold online, from clothes to transportation. For some, this change is more exciting than it is threatening. But for others, it'€™s apparently the opposite.

In Indonesia, there are two distinct contrasting examples of how companies have reacted to the change in consumer behavior to being online-based.

In the e-commerce business, with the arrival of mobile application-based ojek (motorcycle taxi) services, Go-Jek, many courier services were challenged. With a few clicks, customers were suddenly able to get purchased goods delivered to their homes at low prices.

It took time for local courier services company JNE, which suffered from the arrival of this new competitor, to launch a similar mobile application to meet customer demand for an affordable delivery service.

JNE was able to adapt because the company, together with its peers understood their market. They have captured their own respective market share, which includes wholesale, air transport and sea transport deliveries '€” services Go-Jek cannot handle. JNE'€™s focus on this part of the market improved, and the firm innovated its services.

In the transportation sector, traditional transportation companies seem to be irked, if not angered, by the arrival of app-based transport services such as Uber, Grab and, again, Go-Jek. The Jakarta Organization of Land Transportation Owners (Organda) has made it clear several times that such online services should be considered illegal, urging the government to ban them.

On Tuesday, thousands of drivers from the Blue Bird Group and Express Transindo Utama '€” the executives of which are members of Organda '€” once more took to the streets to protest against their app-based competitors in a demonstration that turned ugly, with employees of a number of online and traditional transport service companies becoming involved in brawls.

On social media, customers showed their contempt for the protesting companies and sympathy for app-based transportation services '€” which should not be the case, because every company has its upsides and downsides. Instead, conventional transportation companies should understand their market and upgrade their business model to adapt to the change.

First, steps that transportation companies can take to survive the digital era include introducing cost-efficiency measures to make their prices more competitive, as well as upgrading their mobile applications to provide customers an easier means to order and track drivers. The main reasons why Uber and Grab have gained popularity in Indonesia is because their apps are very easy to use (ease for customers), drivers can be tracked before, during and after the trip (safety) and their prices are about 30 percent lower than regular taxis (pricing).

Second, transportation companies can tie-up with their app-based counterparts to serve customers and share income, a scheme that has been already adopted by Surabaya'€™s Silver Taxi service, which provides drivers and cars in partnership with Grab'€™s digital ordering platform.

Third, understanding the market. Blue Bird Group and Express have the competitive advantage of a much wider network and a fleet that is much larger than the likes of Uber and Grab. Blue Bird'€™s fleet amounts to over 32,500 vehicles in more than 15 cities across the country, controlling approximately a 43.5 percent share of the country'€™s taxi market. Meanwhile, Uber has about 10,000 drivers in Jakarta, Bandung and Bali. The Car Rental Businessmen Association (PPRI) expected a total of 15,000 cars to join Grab by the end of last year.

With its extensive network, Blue Bird also has many corporate clients that enable the firms'€™ employees to pay for their trips with vouchers (cashless), providing ease for its customers. However, the taxi company should be mindful that many of these firms are undergoing major cost-cutting efforts and lay-offs, hence a slowdown in the taxi business should also be expected, regardless of competition.

Blue Bird'€™s shares, listed on the Indonesia Stock Exchange (IDX) under the code BIRD, slumped 34 percent in the past year while Express (TAXI) plummeted 73 percent, as their financial performance disappointed investors, with net income flat-lining and being squeezed. However, both firms continue to book profits, indicating that financial difficulties do not apply across the board, and are likely centered in big cities that offer a greater range of alternative transportation modes.

For the government'€™s part, it should play a greater role in regulating these new services. In the Philippines, for example, the government has introduced four transportation categories: technology or online-enabled platform transportation services, premium taxis, airport buses and bus rapid transit '€“ with each governed differently. In Singapore, there is a law governing third-party booking service providers.

Indonesia last amended its Traffic and Land Transportation Law only in 2009 and the Transportation Ministry is said to be drafting a regulation that is expected to clear up its stance on app-based transportation services. The legislation should provide clear guidelines on the new transportation landscape, perhaps by setting special pricing and safety standards, as applies to traditional taxi companies.

After all, customers have the final say on who they want to ride with and why. Bearing this in mind, transportation companies should introspect: What do customers want? The answer should be simple: safety, ease of use and affordable prices.

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