Like many countries around the world, ride-hailing companies have taken Saudi Arabia by storm.

These apps, or platforms (in this case Careem and Uber) use their innovative technologies to – again just like in other countries – caused a huge amount of disruption to the traditional taxi services available in the country.

Having quickly recognized the need to embrace these disruptors, rather than work against them, Saudi Arabia’s Public Transport Authority (PTA), quickly realized that the country is lacking the regulation required to manage these applications and the services they provide.

This is where Elm, a Saudi-based tech company, stepped in. They created Wasl, an e-platform that links ride-hailing apps and traditional taxi companies with the PTA, while ensuring that Saudi citizens still receive the same level of service.

In order to tackle this, and come up with a suitable approach, Elm recommended a number of steps be taken to ensure it serves its purpose while also adding value for all parties involved, including the government, the ride-hailing apps and taxi companies, and most importantly the general public.

Disruptive forces

As a technology company, Elm believes that government should embrace digital solutions as a way to build agile regulatory frameworks. However, this requires an understanding of the value provided by these innovations and recognizing the potential of market-shifting disruptive forces.

“As a regulatory authority, the PTR needed a sound policy framework to ensure fair, orderly, transparent and efficient markers while providing best in class service, therefore it was vital to build a digital platform that could provide the same services while still governing it and protecting the end users, in this case, the population of Saudi Arabia.” Said Dr AbdulRahman Aljadhai, CEO of Elm, at IMD’s signature program Orchestrating Winning Performance in Dubai.

Streamlining

For the PTA, the application helped streamline data and information from ride-hailing companies (on vehicles and drivers) and allowed it to monitor and control transport flows and ensure higher levels of safety and security.

Additionally, the government said the platform also improved their readiness to respond to crisis situations, such as lost property or even crisis situations, like a person going missing.

It has also helped encourage a competitive spirit amongst the ride-hailing companies, thus elevating the overall level of service across the country.

For Wasl end users - the providers of transportation services - the platform also opened up a number of services including vehicle registration, driver registration, and validation of security status, all of which can now be carried out on the platform.  

Last but not least, for the general public using the ride-hailing apps, Wasl means they are now using a service that is more secure, better regulated, more accountable and more transparent. At the same time, it facilitates access for startups in this area of operation.

Avoiding pitfalls

Aljadhai added that when a disruptive innovation threatens the market, the “non-proactive” approach is a recipe for failure. It is important to be agile and make radical changes in order to embrace and regulate services.

Governments also need to recognize the potential of market-shifting, disruptive forces, embrace innovation as a way to regulate and build agile regulatory frameworks, he said.

Digital platforms, meanwhile, need to be innovative and offer new ways of creating value for all parties involved while taking a holistic view on the economy