BUSINESS

Uber's CEO Needs To Step Down

A company’s culture starts at the top and Kalanick’s track record of condoning and encouraging harassment and discrimination are now clear.

08/06/2017 2:25 AM IST | Updated 10/06/2017 5:28 AM IST
Reuters Staff / Reuters
Reuters Staff / Reuters

Can Uber really change its toxic bro culture if bro-in-chief Travis Kalanick sticks around? The answer now is clearly no.

Since HuffPost first published this article on Wednesday, new revelations have emerged about the Uber chief executive that offer even more evidence that Kalanick is not a leader capable of managing a company where employees (and customers) are free from harassment and discrimination. 

Late on Thursday, Recode published an email Kalanick sent to Uber employees in 2013 advising them on how to behave at an upcoming company party. 

An excerpt speaks for itself:

“Do not have sex with another employee UNLESS a) you have asked that person for that privilege and they have responded with an emphatic “YES! I will have sex with you” AND b) the two (or more) of you do not work in the same chain of command. Yes, that means that Travis will be celibate on this trip. #CEOLife #FML”

FML indeed. Is it any wonder Uber has a big problem with discrimination, harassment and bullying when the CEO so clearly feels that the workplace is a kind of profitable frat party? 

As Uber scrambles to fix the broken workplace, rife with inexperienced managers, weak human resource processes, sexual harassment and bullying, it’s becoming pretty clear that Kalanick shouldn’t be around at the end of the process.

On Tuesday, Uber fired a stunning 20 employees ― some senior executives ― for a variety of offenses, including sexual harassment, bullying, bias and retaliation unearthed by an outside law firm.

An additional executive was fired, Recode reported, because he had illegally obtained the medical records of a woman who was raped by an Uber driver in India and showed them Kalanick, who took no action. The executive, Eric Alexander, the president of business in the Asia Pacific, believed the customer’s allegation was a hoax. An Indian court sentenced the driver to life in prison for his crime.

More firings are likely.

Next week, Uber is expected to release a report on harassment and discrimination at a company-wide meeting, the result of a separate investigation led by former attorney general Eric Holder, now a partner at a big D.C. law firm. 

The company is desperately seeking to change its reputation, in the gutter since at least February, when former engineer Susan Fowler published a blog post detailing horrifying sexual harassment.

Not only did Fowler’s boss sexually proposition her on her first day, her complaint to human resources was blown off because her manager was considered too valuable an employee. Fowler said she heard similar stories of sexual harassment from female colleagues.

Since then, Uber has taken steps to improve its human resources department and its image, and a stream of top executives have fled.

“Do I trigger something in certain people that’s related to something that I didn’t do? Or am I an asshole? I’d love to know,” Kalanick told Fortune magazine’s Adam Lashinsky. “I don’t think I’m an asshole. I’m pretty sure I’m not.”

“Culture changes have been well underway at the company for months now,” an Uber spokeswoman told HuffPost. “Moving forward, we’re more committed than ever to turning the page. We want to change.”

Just this week, Uber hired Harvard Business School professor Frances Frei, a management consultant and expert in company culture best known for her efforts to change how Harvard’s B-school treats women. Uber also hired a brand consultant from Apple, also a woman, to help improve its image.

Thing is, you don’t need fancy consultants to tell you this simple truth about company culture: It starts at the top. The boss sets the example, the tone and the norms for the entire company. (This applies to government, as well. Just ask any White House staffer trying to work under President Donald Trump.)

Uber is just now fixing a computer algorithm to determine how much to pay new hires. The old system reinforced gender pay gaps, allowing women to be paid less than men. 

Kalanick’s vibe is well known at this point: He works obsessively hard, and expects everyone at Uber to do the same. The result is a company worth billions, and a brutal, hard-driving culture with incredibly high turnover.

Apple CEO and founder Steve Jobs also had a reputation for driving workers hard, and saying things bluntly. That’s not unusual for a startup founder. At Uber, problems have come when Kalanick has opened his mouth and said incredibly arrogant and misogynistic things.

“Do I trigger something in certain people that’s related to something that I didn’t do? Or am I an asshole? I’d love to know,” Kalanick told Fortune magazine’s Adam Lashinsky. “I don’t think I’m an asshole. I’m pretty sure I’m not.” (Kalanick has been keeping a low profile since the recent sudden death of his mother. They were reportedly very close.)

Kalanick has amassed quite a track record for inappropriate comments: In an interview with GQ in 2014, he bragged about how his newfound fame as a tech CEO was attracting women. “Yeah, we call that Boob-er,” he said.

A recent story in tech publication The Information described Kalanick’s visit to a South Korean karaoke and escort bar with executives, mostly men and at least one woman, who reported being extremely uncomfortable.

His former girlfriend told HuffPost recently that when she was with him, they’d frequently attend parties, where most of the women were models flown in to serve as, essentially, decor.

After a video of Kalanick fighting with an Uber driver went viral earlier this year, he finally admitted his behavior was a problem. “It’s clear this video is a reflection of me ― and the criticism we’ve received is a stark reminder that I must fundamentally change as a leader and grow up,” Kalanick wrote in a blog post titled “A profound apology.”

Who decided it was profound?

“This is the first time I’ve been willing to admit that I need leadership help and I intend to get it,” he wrote.

He’s begun meditating, according to Uber board member and HuffPost founder Arianna Huffington.

Kalanick, it is worth emphasizing, is not a 20-something prodigy running a tech company. He is a relatively experienced executive who has been running Uber since 2010. He is 40 years old.

This was an adult male admitting he’d behaved like a child. He hasn’t yet proven whether he has the chops to actually grapple with his behavior.

Companies that have managed big culture shifts usually do it with new leaders. Microsoft, for example, seems to have really changed its way since hiring Satya Nadella to replace Steve Ballmer, known for fueling a toxic, competitive culture.

Kalanick has admitted he needs leadership help, and this week’s hires are part of the change, it seems. But it’s not at all clear that this is enough. Indeed, the company’s HR chief, Liane Hornsey, who is close to Kalanick, seemed to downplay the idea that sexual harassment is even a problem at Uber just last month in an interview with USA Today. She said pay and “pride” are more at issue.

Dimitrios Kambouris via Getty Images
Kalanick and his former girlfriend Gabi Hozwarth last year.

Fowler’s “blog shocked me,” Hornsey said. “But, what did surprise me, was when I did the listening sessions, this didn’t come up as an issue. It wasn’t one of our big themes. Other things came up that are in that area, that our values are masculine and a little aggressive, but the harassment issue, I just didn’t find that at all.”

But it seems Hornsey was downplaying the situation. Of the 215 claims investigated by Perkins Coie, the law firm whose report led to this week’s firings, 47 involved sexual harassment, Uber’s only female board member told CNBC on Wednesday.

Leaders aren’t solely responsible for the way a company operates. “Leaders set an example,” Joseph Badaracco, a professor at Harvard Business School, told HuffPost recently. Still, he said, companies need to have systems in place that reinforce employee behavior. Workers need to have strong managers, understand the rules of the workplace, and know that misbehavior will not be tolerated. 

A fast-growing startup inevitably has a lot of problems as it expands. A majority of Uber’s managers are in a supervisory role for the first time, creating all kinds of complications. Uber also hired very quickly ― a notoriously way to build a company culture ― and basically had been using its human resources department as a recruiting arm, not a place to help employees with issues.

But for all the layers of ingredients that brought Uber to where it is, it would seem that problems came baked in with one of its very first workers.

The headline and opening paragraphs of this article have been updated to account for the disclosure of Kalanick’s 2013 memo to employees.

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