by Mike Morrow

Uber’s culture crash and how to avoid it

Jul 12, 2017

Technology executives must prioritize the soft skills of people management to achieve long-term success in an analytical field.

uber in the enterprise primary
Credit: Thinkstock/Uber

Uber has been in a leadership crisis for the last several years. In recent months, Uber has gone through a series of highly public missteps. Some highlights include:

  • The NYT published a bombshell report, accusing Uber of promoting a culture of sexual harassment.
  • CEO Travis Kalanick berated an Uber driver on video.
  • The WSJ reported that Uber used a nefarious software to trick and avoid law enforcement.
  • The WSJ reported that Uber had “mistakenly” shortchanged drivers by millions of dollars, despite documentation that they were aware of this problem since 2015.
  • Uber announced it had lost over $700M in the first quarter of 2017 as its head of finance is departing to join another start-up. Uber has operated without a CFO since 2015.
  • Google accused Uber of stealing proprietary self-driving car technology by hiring a former Google employee immediately after his resignation from Google; Uber later fired this employee.
  • It fired 20 employees for sexual harassment, including an executive who did not disclose that he was fired from ABC for sexual harassment.
  • CEO Travis Kalanick was forced to resign; Uber now operates without a CEO, COO, and CFO.

While the intense scrutiny began in February when Susan Fowler published a blistering condemnation of the abusive culture, the problems Uber faces today have been snowballing well before she came forward. We typically think of problems in the workplace – sexual harassment, embezzlement, a discriminatory hiring practice – as one-off instances of someone making a mistake. In reality, these issues are a culmination of a progression of looking the other way, lack of accountability, and mismanagement of culture. Growing and expanding a team is exciting – it means a company has identified its product-market fit and is gaining traction. As technology leaders quickly scale business operations and product development, the team and culture must scale with it. Making culture a priority from the start, rather than fixing it when it’s broken (see: Uber) is critical for long-term success of the company. 

If you’re a technology executive or startup leader, I know what you must be thinking: “I’m barely surviving here! We’re treading water trying to launch our next product/update; I don’t have time to sit around and sing ‘Kumbaya.’” I can really empathize with this – when every day and week can be life or death to the success of a business, taking a few hours out of an already packed schedule to think about leadership and culture can seem mundane. But here’s the thing: If you’re serious about expanding your company for the long term, you need to get ahead of your culture and mold it early, rather than do damage control. Here is a phrase you probably haven’t heard before: Don’t be the next Uber. By that, I mean think about your culture early and often, and shape it into the type of place your employees will love to come to every day.

The potential downside of not managing your culture are well document: Uber now has several investigations and lawsuits open; in 1985, NASA’s culture of overconfidence and shutting down dissent led to the Challenger tragedy; Ford’s culture of aggressive growth came under fire for releasing the Ford Pinto despite knowing the threat to consumers; the NFL’s culture, led by Roger Goodell, has seen player safety take a major backseat and issues like domestic violence swept under the rug. Eventually, a toxic culture catches up, and it can lead to enormous mistakes, great talent leaving, decreased revenue, and potentially death.

On the other side of the table, managing a great culture can lead to some of the most productive and enjoyable places to work. Facebook, Google, and LinkedIn each made culture a priority from the outset, and are now among the most valuable companies on the planet. Zappos became a $1 billion company based almost entirely on the premise that if they build a company culture that prioritizes customer service and experience, it would flourish. Bain, McKinsey, and Boston Consulting Group – all high-performing and prestigious consulting firms – are among the top 15, according to Forbes. Beyond hitting huge revenues and valuations, these companies are also consistently rated as among the best places to work by employees.

Managing your culture, especially in the fast-paced technology industry, can be daunting. Here are some tangible steps to take control of your culture early and often:

  1. Measure your culture. Technology companies are data-driven by nature, so leverage this as a strength. Use anonymous survey data to regularly take the pulse of your company every few months and track improvements.
  2. Ask for feedback. Your employees know what they like and dislike, what are priorities for change and what are not – ask them! And once you have answers – listen. Don’t assume employees are less intelligent or insightful on culture because they do not have the same vantage as you.
  3. Peer review. Many of the difficulties in managing culture arise due to unspoken problems and conflicts. Provide a channel for employees to give feedback to one another on each other’s strengths and weaknesses.
  4. Create a space for dialogue. Google has a weekly standing meeting where all employees around the world can ask the CEO questions or bring up discussion points. If you don’t create a space where employees can raise their hand, they never will.
  5. Select for culture. Discussing culture is critical, but failing to act on it wastes time, energy, and resources. Determine which people in your company exemplify the culture you seek to cultivate, and which people do not. Identify which operational practices align or do not align with your values.
  6. Positive reinforcement and negative feedback. Praise employees at any level for exemplifying the culture you want to instill in others, and speak up when you see people veering off track. If cultural problems go unspoken, they become acceptable over time.