ADVICE TO UBER FROM A FORMER CEO
When you’re a business leader, the chances are you’re going to blow it with your people at some point or another. A decision you’ve taken is going to come back to haunt you. A hiring or firing decision will bite you in the proverbial. This is an immutable law of business.
But Uber's problems go far deeper than this. Uber has been rocked by accusations that its management has fostered a workplace environment where harassment, discrimination and bullying are left unchecked. Earlier in the month, Uber announced that it had fired 20 employees following allegations of harassment after a separate investigation by a different law firm. While board member David Bonnerman resigned after he cracked an inappropriate joke about how much women talk in the boardroom. Ironically Bonnerman's comments came during an Uber event actually designed to spotlight the changes the company would be making to make its culture more inclusive.
Under Travis Kalanick, Uber has shaken up the taxi industry in hundreds of cities and turned the San Francisco-based company into the world’s most valuable start-up. Its' valuation has climbed to nearly $70bn (£55bn). However, Kalanick, 40, has acknowledged his management style needs improvement. He said earlier this year that he needed to “fundamentally change and grow up”. That’s one way of putting it.
Last week, Kalanick presented employees with the findings of a scathing report about Uber’s culture, as he confronted his biggest crisis of leadership yet. The report, prepared by former US attorney-general Eric Holder, was the result of an external investigation into the culture that developed as Uber grew from a scrappy start-up into the most valuable private company in Silicon Valley.
The Holder report is Uber’s attempt to draw a line under the series of scandals and setbacks that have engulfed the company and left some investors questioning whether its current valuation can hold. But will this be enough to restore the trust of Uber’s employees and customers? It’s hard to tell at this point because of the hit the company has taken to its reputation.
Shortly afterwards Kalanick announced a leave of absence following the death of his mother in a tragic boating accident. This in itself is unusual as CEOs normally only take a leave of absence for medical reasons.
“During this interim period, the leadership team, my directs, will be running the company,” Kalanick wrote to his employees. “I will be available as needed for the most strategic decisions, but I will be empowering them to be bold and decisive in order to move the company forward swiftly.”
The length of leave is open-ended, and “may be shorter or longer than we might expect.”
Uber's problems are compounded by the weaknesses of its leadership team. The board did not immediately name an interim CEO, and there is no natural second-in-command who could take up the reins as a COO. Kalanick is leaving behind a shell of a leadership team, with six key posts vacant including those of CFO, CMO and chief Diversity Officer. The embattled company will rely on a team of 12 executives to carry out one of the most challenging makeovers in business today.
Here are 5 immediate actions Travis Kalanick and the company can take to turn what is a dire situation around and re-boot the company’s badly sullied image.
1. Take Extreme Ownership
Extreme ownership is the only course of action when your company is faced with such an onslaught of complaints and negative publicity. Take a page out of the Navy SEALs and own the failure. Say:
“Something has gone terribly wrong. The full responsibility lies with me. I will do whatever it takes to make things right and learn from this experience so that it never happens again.”
A sincere statement like this will throw water on the fire. This will not be enough to put out all the flames, but it may be enough to keep them from burning down the whole company which is currently plagued by sexual harassment complaints, threatened by boycotts, sued and subject to a federal investigation (that it used a fake version of its app to thwart authorities looking into whether it was breaking local laws).
2. Appoint A COO
The composition of Uber’s Board is such that Travis Kalanick is unlikely to be removed. But he could allow a seasoned COO to take over and re-build the senior leadership team and the company’s tarnished brand. This decision should come voluntarily from Kalanick as this will signal that he understands that he does not have the right skill-set to lead the company on a day to day level.
3. Implement All Recommendations From Holder’s Report Promptly
Board members have voted unanimously to adopt all of the recommendations made by Covington & Burling LLP, a law firm hired to investigate complaints of widespread sexual harassment and other cultural problems at Uber. It’s imperative that they do so quickly and publicly. Not only to stop the current rot in its track. But to rebuild public and employee confidence as quickly as possible.
4. Adopt A Zero Tolerance Attitude To Sexual Harassment
One of the biggest concerns of women when using a taxi company is safety. Uber should adopt a zero tolerance attitude to sexual harassment, immediately suspending employees and drivers when complaints are made. Complaints should be investigated promptly, and if found proven, summary dismissal result.
Managers should be trained in how to deal with allegations of sexual harassment, and all staff should receive training in the company’s procedures.
5. Partner With A Non Profit Specialising In Sexual Harassment
This is a longer term strategic action to mend the company's damaged image. Unilever brought in the environmental expert, Jonathan Porritt, to advise them on their sustainable business policy. Uber would do well to mirror such an approach with regard to sexual harassment and women’s safety.
Working with a non-profit partner to champion equality and diversity, both within the company and externally, would be a highly effective way of effecting and embedding cultural change, whilst re-booting the company’s tarnished image.
Uber has a small window of opportunity to turn around a dire situation and prevent it from becoming a tragedy. It's well on the way to becoming a Business School case study. But if the company does the right thing, it might just end up turning this around and become a respected brand.
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Question: How would you handle the Uber situation? I love reading your feedback so please do take a moment to share how you’re going to use this in the comments box below.
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