Uber Can’t Figure Out How To Shift Its Culture So I Did It For Them

"Culture work is never done" - Dara Khosrowshahi, CEO, Uber

That was then

Uber was once an unstoppable force.

Then 2017 happened. It began in January with the first #DeleteUber moment, this one triggered by chaos at a New York airport. Then Susan Fowler published her epic post on harassment at Uber. A video of Kalanick telling a driver, “You know what, some people don’t like to take responsibility” added fuel to the fire. A multitude of senior executives resigned. And then, in an almost unprecedented move, some of the key investors in Uber began to revolt and on June 20 Travis Kalanick, the iconic CEO of Uber, resigned.

Uber is a giant felled by culture problems. 

Uber’s approach to changing culture is weak: Good intentions, terrible execution

After Travis was ousted, Dara Khosrowshahi became the CEO and immediately attempted to change Uber’s culture. However, after one year as CEO, he said, “If there's one area that I would have liked to change faster, it is to execute more fully on our cultural transformation as a company internally, across all levels at the company.”

As an outside observer, I do not know what Uber has done to execute its cultural transformation but all public evidence suggests it is weak sauce. And we know it is not working because Dara said so.

The media reported that Uber changed its value statement when Dara became CEO. This is a start but the agile community knows that culture cannot be asserted, it must be lived. Culture change is not as simple as stating the culture one wants.

A culture shift must take into account and provide support for fundamental internal disagreements; emotionally toxic situations; hostile relationships with external partners (such as drivers and governments); and a lack of organizational alignment and shared understanding. While I am not privy to internal details of Uber’s cultural transformation, I see no evidence that it has provided even a fraction of the support that the agile community would recommend.

Culture change at Uber appears to be driven almost entirely top down as if culture is a physical asset that can be sculpted. This is a common mistake made by large organizations, treating culture change as if it were akin to rolling out a new ERP system.

Agilists know that culture is an emergent property of a complex system. 

What the agile community knows about culture change

Frederic Laloux in Reinventing Organizations gives a clean accounting of culture shifts.

Here is a simplified description of Laloux’s model. Each level is associated with a color:

• Red: Impulsive. Like wolf packs. Street gangs and mafias.
• Orange: Achievement. Like machines. Most corporations.
• Green: Pluralistic. Like family. Zappos.
• Teal: Evolutionary. Like living organisms. Patagonia.

There is nothing better about being at one stage of cultural development versus another. However, a teal organization has more options than any other organization and a red organization has the fewest options. This is critical for Uber. At its current level of cultural development, Uber does not have the space to select a business model, operating model, and corporate strategy that ensures survival.

So Uber must evolve its culture to thrive from red/orange (Travis) to orange/green (Dara) to green/teal.

Immediate suggestions

Dara must grow

A hermeneutic analysis of Dara’s utterances while CEO of Uber and Expedia shows that he is operating at the orange/green level of consciousness.

• An example of an orange statement is, “a big part of our job as leaders is to make tough calls based on what is best for Uber and our long-term future” which he wrote after firing 400 marketing employees without co-creating the change with them. The notion that senior executives know what is best is an orange conception.
• An example of a green statement is, “I have to tell you I am scared” which he wrote in a memo to Expedia employees when he left for Uber. Sharing emotional state is part of the ‘whole self’ ethos.

For Uber to be successful Dara must model green/teal consciousness. The first step in making the shift is for Dara to become aware of his current state and acknowledge the damage that he is doing to the organization. 

Go small to stabilize

Uber has two options: (1) grow or (2) shrink. Both will cause the stock price to fall. Only the latter will allow Uber to survive.

What will happen when Uber gets smaller cannot be predicted. What we do know is that an unstable system cannot improve. Growth will contribute to greater instability and prevent improvements in culture.

Create a love/love relationship with drivers

Creating a love/love relationship with drivers would be groundbreaking, immediately shifting the cultural conversation around Uber.

Doing this would not be technically hard but it would require courage and vulnerability. Here is a specific proposal:

1. Become aware of the harm that is being done to the organizational-relational system due to Uber’s adversarial stance towards drivers.
2. Acknowledge the harm that has been done in the past.
3. Widen the circle of care and begin listening to drivers and others.
4. Increase transparency (financial and otherwise).
5. Increase psychological safety, equal voice, and trust.
6. Collaborate with drivers and others on strategies that meet the needs of everyone.
7. Select one strategy and experiment with it.

Uber can do this proactively and reap the benefits or it can wait until it is done to them and risk losing its business. Uber’s “wait the drivers out” approach is not on the right side of cultural megatrends:

• All major Democratic presidential candidates are for a $15/hr minimum wage. They are also all in favor of strengthening unions.
• As of this writing, the odds of a Democrat winning the White House in 2020 are slightly above 50%. 
• When New York passed a minimum wage law that applied to Uber drivers, Uber immediately experienced an unwelcome negative economic impact. 

Closely examine key Travis hires

This is painful to say because it lacks compassion but the large number of Travis hires that continue to hold senior positions at Uber exerts a red/orange cultural drag on the organization. All of us carry a constellation of stories, values, and beliefs about what ‘good’ looks like and, while not immutable, it tends to change at a glacier-like pace.

It is unlikely that the people who created, allowed, and executed the red/orange culture under Travis will be the people who role model a green/teal culture. The level of awareness, skill, and personal growth that would be required to do this is rarely observed.

Dara should consider what impact legacy Travis hires are having on the culture.

Ignore Bradley Tusk

“The greatest danger in times of turbulence is not the turbulence. It is to act with yesterday’s logic.” - Peter Drucker

Bradley Tusk was a key figure in Uber’s rise to prominence: he crafted the strategy that enabled Uber to bulldoze city and state governments. He is now a reactionary voice in the Uber pantheon urging Dara to act like Travis. Bradley recently said that Uber lacks the “ruthlessness” it had under Travis. 

Bradley is best ignored. Going back in time is not an option and, even if it were, is a foolish move.

Being more aggressive is not helpful. It’s like pressing harder on the gas pedal when the motor has blown a gasket. Uber needs to avoid voices that tell it to push harder and instead concentrate on healing.

The time is now

Uber’s stock price has been shredded over the past year. At one point WSJ reported that it could go public at a valuation of $120B. This year it has traded at a valuation below $60B, a stunning decline.

Continued survival is optional.

Uber’s weak understanding of how to grow culture is constraining its business model, operating model, and corporate strategy. Only by moving to a higher level of consciousness will Uber find the space to create an approach that is good for it, for drivers, for governments, and for the world.