A few weeks ago this blog detailed the incredibly disturbing allegations of sexual harassment at Uber, which seems to be symptoms of a male dominated environment that excludes women and doesn’t properly enforce sexual harassment rules. Now this morning,(Edit-now last month) it’s been announced that the embattled CEO Travis Kalanick is stepping down, as detailed in Tom Fishers article in the Chicago tribune. Apparently Kalanick had received a letter Tuesday from investors demanding that he resign. This also comes at a tough personal time for Kalanick as he has recently lost his mother. But as the article details, his fallout from the company was very much his own doing. “The resignation came after a series of costly missteps under Kalanick that damaged Uber’s reputation, including revelations of sexual harassment in its offices, allegations of trade secrets theft and a federal investigation into efforts to mislead local government regulators.” Uber had a quick rise after its conception confronting the taxi service, but these recent missteps of the company have many questioning whether it can adjust and become a mature and stable business. The company recently lost a battle in China to a major ride sharing company, Didi Chuxing, which contributed to Uber posting a $708 million first quarter loss. Kalanick’s leadership style is known as heavily combative which has probably undermined both him and the companies reputation. The article quotes Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisburg-Essen in detailing some of the ways that this combative style alienated investors, customers, and drivers; “The significance of Uber has declined because the company has not managed to present itself in a stable and socially responsible way,” Dudenhoeffer said. “When you’re at war with customers, employees, service suppliers, you can’t build up a business model and Kalanick was at war with everyone.” Dudenhoeffer concluded “There is no business model in being at war.” Kalanick constantly got in his own way and he and everyone is paying the price.
The biggest issues Uber has though are not economic, (though they may argue that) but involve a lack of ethics and social responsibility as Dudenhoeffer explained. As mentioned before, Uber has been accused of being an unsafe work environment and a former engineer in February wrote a personal essay detailing her year at Uber and the sexual harassment she faced from her manager, who she then reported to human resources. But as Fisher explains, “She reported him to human resources, but was told he would get a lecture and no further punishment because he was a “high performer,” she wrote. This got the boards attention and was a big step towards Kalanick’s downfall. This led to the firing of about 20 people, and an investigation into Uber’s workplace by the Attorney General Eric Holder. Holder’s probe revealed that Uber didn’t even have the most basic policies used to protect employees from sexual harassment.
Another incident which made many question Kalanick further happened when a video surfaced in February showing Kalanick berating a driver who was complaining about his pay. Many drivers feel that Kalanick is exploiting their labor and he has resisted a tipping feature in the app. Kalanick’s parting statement sounded a bit like him trying to make himself into a martyr. “In a statement, the 40-year-old co-founder said his resignation would help Uber go back to building “rather than be distracted with another fight,” an apparent reference to efforts on the board to oust him.” The board though was trying to oust him because he had completely undermined their company. The move is a needed one for Uber who needs to undergo some serious changes if it wants to make itself into a respectable business that isn’t exploitive or unsafe for people. It would especially help if they could integrate women into the company instead of pretty much everyone in power being male. This is an issue with Silicon Valley and many businesses across the country in general.
