When bike-sharing crashed in China: a bumpy ride

Abstract

Purpose

Buoyed by the desire to reduce carbon dioxide emissions and develop sustainable urban transportation, the dockless bike-sharing industry boomed in China during 2017–2018. To the surprise of the stakeholders, this industry dramatically ebbed in 2019. The dockless bike-sharing system deviated from a problem-solver to a troublemaker in a very short period. The oversupplied and excessively discarded shared bikes caused a big waste of resources and serious pollution to the environment. In this paper, the decision-making of the key players of the industry, i.e. business operators, investors, customers and government, is analyzed through the lens of the cognitive bias. This paper aims to illuminate the process of how this innovative transport solution turned to a disastrous ending, which caused damage to urban environment and financial loss to investors.

Design/methodology/approach

In this study, a qualitative analysis based on the rich secondary data sources is conducted. A rich amount of qualitative data including news reports, government policies, consulting reports and companies’ annual reports etc. were collected.

Findings

The study shows, in the product introduction period, the government, business operators, investors and consumers fell into the cognitive bias. They over focused on the positive side such as high-tech, eco-friendly, convenient image of the dockless bike-sharing solution. Thereby, the key stakeholders made irrational decisions in product adoption and management. This study moves toward increasing key stakeholders’ awareness of the imperative to reduce these biases when promoting eco-innovations. This study also recommends a prudent attitude with a rational and comprehensive thinking style in dealing with eco-innovation and the emerging sharing economy.

Originality/value

To solve the cognitive biases, this study recommends that people use rational decision-making style to examine and adopt the dockless bike-sharing solutions. Practical recommendations to tackle the existing recycling crisis of the dockless bike-sharing industry are also discussed.

Citation

Zhao, S., Xiong, J., Kim, S.-Y., Xu, L. and Yan, J. (2021), "When bike-sharing crashed in China: a bumpy ride", Journal of Business Strategy, Vol. 42 No. 5, pp. 295-303. https://doi.org/10.1108/JBS-01-2020-0003