The now notorious ride-hailing service Uber was at the heart of a staggering string of scandals in the months leading up to CEO Travis Kalanick’s resignation in June of last year. Their new chief, CEO Dara Khosrowshahi, has had his work cut for him since he started the following August. But can he salvage Uber’s tarnished name? Can he give the world reason to offer the company a second chance?
Following no small number of controversies in prior years, 2017 kicked off with a scandal over Uber’s false advertisements to drivers about how much they could expect to earn driving for Uber. Later in January, a “Delete Uber” campaign surged on social media after the company took advantage of a taxi protest in solidarity with protesters against Donald Trump’s travel ban. About 500,000 users deleted their Uber accounts. On a similar note, users threatened a boycott the following month over Kalanick’s participation in Trump’s advisory council.
That same month, former Uber engineer Susan Fowler took to her blog to detail a culture of harassment, sexism, and discrimination within the company. Later in February, Alphabet’s autonomous car firm Waymo sued Uber, alleging a “calculated theft” of its self-driving car technology.
In March, a New York Times report showed that the company had used its “Greyball” tool to avoid law enforcement in cities where the ride service was prohibited, resulting in a federal investigation. Kalanick was caught on video that same month, aggressively arguing with an Uber driver, for which he later apologized. In April, it was revealed that the company was spying on its competitor, Lyft, and in May, Uber admitted it had underpaid New York City drivers, paying tens of millions in compensation. In November, the company revealed that it had paid hackers to cover up a data breach that had revealed the personal data of 57 million users in October of 2016.
Bearing in mind that this list leaves out many smaller controversies, those prior to 2017, and reports of misconduct and violence by individual Uber drivers, it has been a truly dizzying series of setbacks for Uber.
Khosrowshahi, 48, is a former investment banker, and had served as CEO of Expedia. Some of the expectation that Khosrowshahi could turn things around for Uber arose from his leadership style and what he represents, rather than concrete actions he might take. The new CEO brought a reputation for patience, fairness, maturity, inclusivity, and a willingness to listen. What could send a bigger statement that the company was moving away from Travis Kalanick’s headstrong, take-no-prisoners approach?
Moreover, the soft-spoken Iranian immigrant is known to take vocal, progressive positions on social issues – an antidote to fears that Kalanick, and his aggressive style of leadership, seemed to veer a bit too close to Trump and his worldview. Khosrowshahi has publicly opposed Trump’s travel ban, and supports the Deferred Action for Childhood Arrivals (DACA) protections for young immigrants, often seen wearing a T-shirt that reads “We are all dreamers.”
Of course, none of this comes at the expense of his abilities as a chief executive. As Expedia CEO, he brought the company’s revenue from $2.1 billion in 2005 to $8.7 billion in 2016.
So far, much of his effort to turn the company around has focused on leveraging his own values and reputation to visibly change Uber’s corporate culture. Khosrowshahi wrote to Uber employees last November:
“As we move from an era of growth at all costs to one of responsible growth, our culture needs to evolve. Rather than ditching everything, I’m focused on preserving what works while quickly changing what doesn’t.”
To replace Kalanick’s stated Uber “values” such as “Make magic,” “Champion’s mind set,” and “Always be hustlin’,” Khosrowshahi’s new set of “cultural norms” includes warmer declarations, such as “We do the right thing. Period,” and “We build globally, we live locally.”
Khosrowshahi has met with Uber drivers all over the world to listen to their concerns, as part of a global “apology tour.” It was Khosrowshahi’s decision to disclose the October 2016 data breach, and the fact that the company had worked to hide the incident. He has campaigned for Uber to provide free rides in disaster-stricken areas, and to protests on progressive causes.
But not every step has focused on broad, abstract changes to the corporate culture. Khosrowshahi has personally negotiated an amicable settlement to the Waymo dispute. He has hired a chief diversity officer tasked with ensuring that employees are receiving equitable pay across the board. Uber is now stepping up its screening of drivers, with annual reviews of background checks. After resisting demands for years, the company is adding a 911 “panic button” feature to its app, allowing riders to easily contact emergency services. The app will also let riders share their location and trip information with as many as five “trusted contacts” to address safety concerns.
“In the past, Uber conducted background check reruns in jurisdictions where required. Going forward, we’ll proactively rerun criminal and motor vehicle checks each year, regardless of whether there is a legal obligation to do so,” said Khosrowshahi.
Of course, these changes are only the beginning. To be clear, Khosrowshahi has yet to prove that he can truly steer Uber out of its public relations tailspin. But Uber’s risk-taking, aggressive approach was in many ways an outgrowth of Kalanick’s bold, contentious, dog-eat-dog worldview. If Khosrowshahi’s receptive, cautious, and mature leadership style can have a similar bearing on how the company operates, Uber may be able to carve out a well-deserved new reputation for itself.