You wouldn’t think there’d be much oxygen left for corporate scandal these days, given the newly elected US government’s gargantuan appetite for it. But somehow, Uber and its billionaire bro-grammer CEO Travis Kalanick have already managed to find a pocket of air in 2017’s frantic newsrooms.
Silicon Valley’s favourite success story, and that of every startup entrepreneur who hopes to become fabulously rich without actually being responsible for anything, can add this to its long, sometimes troubling list of accomplishments. Uber and its boss are having a rough 2017, and everybody knows it.
Joining President Donald Trump’s economic advisory council probably wasn’t a good start. Lots of Uber drivers are immigrants and, for many, Kalanick’s apparent support for Trump was a personal betrayal. Meanwhile, any question about how civic-minded the CEO’s motives were evaporated when Uber tried to profit from a taxi protest over Trump’s immigration ban. Then came Susan Fowler Regetti’s sexual harassment claim, Uber’s disinterest in dealing with the problem, and the other employees who stood up to tell similar stories in its wake. And then came the dash cam video of seat-dancing Kalanick arguing abusively with an Uber driver about a competitive pricing strategy that was costing the man his living. Earlier this month it emerged that the company has been manipulating its app to avoid interactions with law enforcement and regulatory officials. And these are just the highlights.
It’s doubtful that this litany of arrogance will bring Uber down—its product remains infuriatingly good, and the taxi industry resolute in its refusal to compete. But there are signs of damage. The #deleteUber campaign that followed the airport protest debacle was the best thing that ever happened to Lyft, Uber’s biggest competitor in the (U.S. Downloads of Lyft’s app surpassed those of Uber’s for the first time in history that week.) On a recent trip to the States, I spoke to more than one Lyft driver who had quit Uber over this and other affronts. Tech media are becoming noticeably less fawning in their Uber coverage. And, tellingly, customers are becoming a bit sheepish about hailing a ride, a stark contrast to the techno-utopian hipness that act once represented.
Pundits are falling all over themselves to point out how much damage these things will do to Uber’s reputation. But the real story here, the one that should keep leaders everywhere up at night, is that none of this is actually news at all. As in most reputational crises, Uber is reaping a harvest it planted in its own back yard years ago. These latest events are climactic, not causal; they’re rooted in a culture that has sanctioned things like ordering and cancelling thousands of Lyft rides to cripple its competitor in new markets. A culture that once inspired a senior executive to threaten to expose the personal information of a journalist who wrote bad things about Uber. A culture inspired by the CEO himself, who has reportedly referred to the company as “Boober” for its salutary effect on his romantic life.
There are lessons in this story everywhere you look. It reminds us that a high-profile CEO is now as publicly exposed as any politician, and can therefore never abandon decorum. It’s a powerful case study in how companies can’t stop listening, no matter how successful they are, because the mercurial public can reframe success in a heartbeat.
But the lesson that matters most is the hardest one to act on: toxic cultures don’t explode. They rot. By the time you can see the damage, it’s irreversible. In Uber’s case, it won’t be fatal, but whether Travis Kalanick will emerge unscathed is another matter (in publicly announcing last week he “needs help” as a leader, he’s likely played his last card). And it’s hard to imagine the baller culture that gave Uber its cachet—and essentially caused all this—hasn’t become a social liability for some customers.
There’s an aphorism generally credited to Amazon’s Jeff Bezos that goes like this: Your brand is what people are saying about you when you’re not in the room. Those judgments aren’t born in a vacuum. They’re born in our own boardrooms, cafeterias, call centers, loading docks and staff meetings. Leaders create culture. Culture creates the enterprise, and therefore eventually its reputation. There’s no escaping that responsibility, Travis. Even in your own limousine.