Commentary

Here’s Where Travis Kalanick Really Went Wrong With Uber’s Harassment Claims

Feb 23, 2017

Uber has been struggling in the reputation department. The most recent setback: a former engineer claims she was sexually harassed and dealt with an HR department offering zero support. These revelations, which she detailed in a highly publicized blog post, comes shortly after customers thought Uber opposed New York City taxi driver’s opposition to President Trump’s travel-ban protests and embarked on an campaign to boycott the ride-sharing app. CEO Travis Kalanick responded by resigning from the president’s advisory group, but the damaging was done.

Trust is paramount for Uber, a business that asks its customers, employees, and drivers alike to literally get in a car with one or more strangers. Uber even presents itself as a socially responsible corporation that offers economic opportunity to drivers in low-income communities and provides reliable transportation access to and from low-income neighborhoods that taxis have often refused to serve. But the erosion of trust associated with these inclusiveness-related controversies has kept #deleteuber trending, costing the company all-important customers and contracted drivers, many of whom have switched loyalty—with a few swipes and taps—to rivals such as Lyft. The stakes are high.

This is only partly a reflection of the growing pains an early-stage firm that has only been around for eight years. As the organization approaches its adolescence, the initial emphasis on speed and growth must give way to a focus on the less sexy but very necessary work of scaling and institutional maintenance – the work of managing an increasingly complex organization and carefully stewarding its culture to ensure responsible growth and long-term sustainability. This is a difficult shift, which is why many founder-CEOs get fired.

The issues around inclusiveness can quickly gain prominence in any public or private sector organization, as suggested by past controversies, such as Hollywood’s gender-based pay gap, the NBA’s decision to move the All-Star Game out of North Carolina because of legislation widely criticized as anti-LGBT, and Microsoft’s CEO’s advice to women “not to negotiate.”

What can Uber and other organizations do to win back trust —or avoid losing it in the first place? Several valuable lessons emerge from Uber’s recent crises.

Act fast—and not just with words

The news cycle moves quickly, which can help the public forget a one-time controversy. But repeated infractions — the case with Uber — or a particularly egregious incident can result in swift, irrevocable judgment and lost loyalty. So leaders need to own a mistake quickly and apologize publicly. Uber CEO Kalanick recently covered this step in his apology this week. But the words must be backed up with assurances and action: In Uber’s case, retaining former U.S. attorney general Eric Holder and engaging board member Arianna Huffington to investigate the allegations is a classic headline-grabbing, positive step in the right direction. But everybody knows that findings from such blue-ribbon commissions don’t always translate into lasting action and accountability.

Look Within

In the midst of crises, it can be tempting to focus solely externally on rebuilding public trust. That’s a mistake, as the problem in question has almost always originated from internal gaps or issues. Here, leaders need to consider the content and visibility of the organization’s stated values or principles, as these will inform culture and practices. If they’re not readily available, that’s a problem. In Uber’s case, leaked internal informationsuggests the business has emphasized core employee competencies such as “fierceness,” “execution” and “quality obsession,” with zero mention of integrity, collaboration, or inclusiveness — values critical to a supportive, ethical culture.

Put values into practice

It’s not enough simply to develop and communicate clear values and operating principles; the business must also craft clear goals, objectives, and metrics built on these and hold leaders at every level accountable for them. Communicating these goals and metrics internally and externally is also critical. In line with this, many Silicon Valley firms have become much more transparent about their efforts to improve diversity and have signed the Tech Inclusion Pledge, helping to elevate trust among employees and the general public. The list includes Uber’s competitor Lyft, among other tech firms.

Emphasize new leadership competencies

As organizations become more diverse, leaders of all businesses have to “walk the talk” of diversity, inclusiveness, and equity. Susan Fowler, who was one of the few female engineers at Uber, represented a measure of diversity at the organization, but found herself in a toxic culture that didn’t reflect true inclusiveness. Walking the talk starts at the top, and that requires leaders who view cross-cultural inclusiveness as more than a convenient priority but an essential competency. Businesses need not only to recruit leaders with inclusiveness-promoting skills but to evaluate them on it and to send the clear message that it’s not acceptable to drop the ball in this area.

Diversify leadership

A more diverse leadership and governance team doesn’t automatically yield a more truly inclusive environment, but it can certainly help, and it sends an important signal internally and externally. Are women part of the core executive team and corporate board (not just the advisory board), with input into key decisions? What about people of color? The presence of such hires or appointees in critical positions will likely boost the overall ability to work across differences at every organizational level, the key leadership competency mentioned above. To promote diversity and inclusiveness, leaders need to scrutinize their talent pipeline to see where women and people of color are stalled or tend to exit, seeking structural solutions to enrich inclusiveness and pipeline vitality. Such analytics are available to most businesses with a sophisticated HR function, but they have to view HR as a strategic function (not just a cost center) and truly engage with observed data to make progress.

Reputation matters. A lot. As Uber and others have discovered firsthand, management of reputation is far from just a branding or public relations issue but requires developing thoughtful values and making real, visible changes that will have both internal and external impact.

Nicholas Pearce is a clinical professor of management & organizations at Northwestern University’s Kellogg School of Management and CEO of The Vocati Group. He is a scholar, lecturer, and trusted strategic adviser on values-driven leadership, collaboration, and change in organizations.

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