Uber company is known almost all over the world as this fast-growing startup has turned into a large-scale network of taxi services. In recent years, Uber has also gained its fame due to scandals and unethical actions of the company and its employees, which reflects the ability of top management and management features of the organization. However, the main reason for these problems is the personality and managerial approach of CEO Travis Kalanick, as well as the harmful organizational culture of Uber company.
Organizational Culture of Uber
Organizational culture is one of the most critical components for any company’s work as it forms the features of the employee’s interaction, communication strategies with partners, and the image of the organization. However, one may note, considering the seven dimensions of organizational culture, that Uber has many shortcomings that come from the top management of the company. It is enough to consider only such three aspects as aggressiveness, people-orientation, as well as innovation and risk-taking to prove this point. The aggressiveness of a company is determined by its approaches to competition, the language it uses, as well as the presence of conflicts and ways to resolve them. Uber’s organizational culture shows itself as aggressive, especially considering the activities of its CEO Travis Kalanick. Firstly, many decisions lead to conflicts and negative public reviews; for example, the ignoring of a strike, the idea of joining Trump’s council, or Kalanick’s refusal to dismiss Levandowski and make a deal with Google. Secondly, company employees use aggressive speech such as, “We will leave no stones unturned.” In general, the article traces the aggressive and intractable mood of Kalanick and other company members.
A people-orientation dimension in a favorable organizational culture is expressed in creating a friendly working atmosphere, support, and respect for each employee’s rights and dignity. However, multiple examples from the article demonstrate that Uber is also not people-oriented. For example, many cases of sexual harassment, which went unnoticed before one former employee’s post was published, showed that the working atmosphere of the organization was threatening. Another example is a situation in which Kalanick shouted at one of the drivers. In addition, a company in which the CEO ignores most of the recommendations of its employees and colleagues cannot be called people-oriented.
The third feature is innovation and risk-taking, which is expressed in the use of new bold solutions for the development of company products, as well as a flat management hierarchy. Although Uber is innovative in both its approach to service organization and technology, its approach is also harmful to organizational culture. The first attempt to start a driverless car was unsuccessful; for this reason, the company perhaps decided to steal Google’s ideas by hiring its former employee, Levandowski. Even if initially Uber did not have such an intention, the leaders had to foresee the situation with Levandowski to avoid fraud. In addition, all the conflicts around leadership positions and the tension of relationships in the management demonstrate that the company has a traditional hierarchical structure. Consequently, innovation is also not a strong feature of Uber’s organizational culture.
Kalanick’s Leadership Approach
Modern leadership theories describe different approaches that seek to get better results and emphasize the best leadership traits. In all theories, the leader should use his or her best qualities to inspire followers, adjust, and improve their performance. However, the article considers Kalanick’s work period, during which he very limitedly applied his positive qualities to be good leaders, which led to his resignation. One may note that charismatic leadership is Kalanick’s primary approach, considering the facts from the article. However, according to leadership theories, this charisma should be used to inspire followers and partners. In the case of Kalanick, some people were encouraged by the belligerent and harsh measures of the CEO, while others found such a stubborn approach inappropriate. The conflicts that caused harm to the company demonstrate that the second part of the people was right.
One may also note an uneven leader-member exchange in the Kalanick team, which also brought harm to his career. Despite the advice and comments of Uber executives, Kalanick preferred to make decisions on his own or highlight some employees; for example, he defended Levandowski. This approach also led to the resign of some essential employees for the company, such as Uber’s President Jeff Jones. Consequently, the member exchange leader was unequal in the management style of Kalanick. Kalanick’s approach also lacked vision, which is confirmed by the decisions to send a taxi to the airport during the strike, the desire to be members of the Trump council, and the hiring of former Google employees. Kalanick also has more features of a transformational leader than transactional as he makes decisions that focus on changes but does nor encourage communication with the team. However, both of these leadership approaches do not characterize Kalanick, since he has a more authoritarian management style. Consequently, although charismatic leadership most accurately describes the Kalanick management approach, multiple mistakes led to the loss of authority and his resignation.
The Changes for Improvement
Uber requires significant changes to improve the organizational culture and working atmosphere for its employees, although the company has already taken the essential step. The new Uber’s CEO focused on the need for internal changes or problems in “us”, which Kalanick has long avoided, which is the major shift. In general, changes should be aimed at those dimensions that have the most lacks, namely, innovativeness, people-orientation, and aggressiveness of the company. The shift from the rigid hierarchy system to the principles of exchange and communication contributes to a more friendly working environment and the emergence of innovative ideas, since employees’ opinion will be considered. This change should be promoted in the first place by the leader’s approach, for example, transactional. In addition, such a shift contributes to creating a people-oriented culture. Although ensuring a safe environment in which employees can make a complaint and be confident that the conflict is fairly resolved is also critical to this dimension.
Positive changes in these two dimensions of organizational culture will also reduce the company’s aggressiveness both in internal and external interactions. However, Kalanick’s insistence, which brought rapid growth to startups, should remain a vital feature of the company. A sharp easing of Uber’s policies and methods could cause losses if competitors and partners consider such a change as the weakness of new management. These improvements require considerable time, but the right approach of top managers to leadership makes them possible.
Therefore, the personalities and approaches to managing the leader are one of the critical aspects of the company’s activities, which can both destroy and develop it. Kalanick’s actions in the last years before his resign have caused significant damage to Uber as his leadership style has created an unfavorable organizational culture and reputation for the company. However, many of his management features in the early years of the startup’s existence brought significant success and rapid growth. Consequently, Uber’s top-management needs to re-examine the main components of the company’s organizational culture and find a management approach that takes advantage of Kalanick’s leadership style and eliminates its weaknesses.