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Making Public-Private Partnerships work: Grab, govt preserve livelihoods during Covid 19
President Joko “Jokowi” Widodo confirmed the first two cases of COVID-19 in Indonesia on March 2, 2020. By April 10, 2020, there were 3,512 confirmed cases in the country, and the government announced large-scale physical distancing measures, including restrictions on transportation.
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resident Joko “Jokowi” Widodo confirmed the first two cases of COVID-19 in Indonesia on March 2, 2020. By April 10, 2020, there were 3,512 confirmed cases in the country, and the government announced large-scale physical distancing measures, including restrictions on transportation. For Grab, the regulations would have a direct impact on the livelihoods of its many driver-partners in Indonesia.
This standstill was a setback for Grab, the government and the people of Indonesia. Ride-sharing greatly contributed to the livelihoods of Indonesians and the loss of this mode of transportation left millions disconnected from work, education and their loved ones.
Grab and the government needed to think fast. Both wanted cars and bikes back on the road but neither wanted to increase the risk of exposure to COVID-19. They had to work together.
In collaboration with the government, Grab launched GrabCar Protect within a month of a ban on ride-hailing. The service required face masks, hand-washing or hand-sanitizing, separation screens between drivers and passengers, as well as allowed penalty-free cancellations.
By June, Grab had launched GrabBike Protect, which provided motorcycle drivers with plastic shields to place between themselves and their passengers, further reducing direct contact to prevent transmission.
Once Grab’s fleet of cars and motorcycles was back in operation, the government reached out to Grab to find a way to promote physical distancing between drivers who may gather while waiting for their next ride or delivery. By September, Grab introduced a geofencing technology that alerts drivers when they are standing less than 1 meter from each other by using data from their phones.
The new health-conscious measures showed excellent results. Grab expanded quickly to delivery services, which now account for about half its business, and transitioned many of its mobility driver-partners over to deliveries. As a result of lockdowns, Grab was seeing high demand for food and grocery deliveries, and those services helped bring thousands of small businesses online during strict physical distancing measures. Because of Grab and the government’s partnership, millions of people in Indonesia were able to get back to earning a living.
Public-private partnerships do not always go so smoothly. Parties may not share the same goals, and crucial resources can be wasted in complex, rigid and financially unsustainable projects.
But how were Grab and the government able to get people back on the road? To start, Grab is able to adapt to unexpected challenges quickly. A recent case study from the Legatum Center for Development and Entrepreneurship at the Massachusetts Institute of Technology (MIT) explains that the company builds this agility on a culture of being mission-driven, user-centric and free to fail.
According to the study, 65 percent of Grab employees interviewed said they had joined the company because they wanted to "serve the people of Southeast Asia”. They see their work as solving the transportation, payment and logistics issues that people face every day. Employees said their connection to the region makes them want to work harder.
Motivated by this mission, Grab employees pay close attention to their users. The company continually collects feedback from its users through the mobile app, call centers and social media. Through these proactive exercises, Grab works to anticipate problems and search for answers.
But problem-solving is not easy. After an issue is observed on the platform, teams develop a hypothesis on what changes they can implement to address it. Grab teams set up an experiment, analyze the results and repeat the process as necessary to achieve the target outcome. Many proposed solutions fail, but this is not necessarily a bad outcome. The Legatum Center’s case study reasons that the culture of being free to fail allows Grab to address a host of issues quickly and creatively. Teams push themselves to learn and pay their failures forward into better solutions. Eventually, one of these sticks.
However, being an agile company is only part of the story. Getting drivers and passengers safely back on the road would not have been possible without the close collaboration between Grab and the government. GrabCar Protect, GrabBike Protect and geofencing were team efforts between both private and public sector partners.
The collaboration worked for two key reasons. First, Grab and the government shared the mission of preserving livelihoods and protecting public health. Trusting one another's intentions, both could take the risks necessary to try to innovative solutions to novel problems. Second, the relationship is a two-way street; both Grab and the government were able to ask one another for help and work together to find a solution. Within this framework, the pair could channel their collective problem-solving power to the benefit of millions of drivers and passengers in Indonesia.
Finding the right combination of private sector agility and public sector collaboration is tough. Not all companies and governments share a vision of the common good as those in this case. However, pressure reveals who is willing to step up. COVID-19 is just one of many crises the world has faced. The more we can learn from successful public-private partnerships, the better equipped we will be to face future challenges.
The author is a consultant at the Legatum Center for Development and Entrepreneurship at MIT
