What a Leaderless Billion-Dollar Company Can Teach Us About Leadership

(Story by Heather Huhman originally appeared in Inc.)

The past year has been tough for Uber, with leadership strategies being a major obstacle. Between sexual harassmentmass protests, and a video of CEO Travis Kalanick shouting at a driver about fares, a change was imminent.

Then, change came. On June 21, Kalanick was forced to resign.

Here are four leadership strategies you can learn from his recent downfall:

Focus on culture and diversity.

When a company grows quickly like Uber did, leaders often forget to focus on diversity. This can lead to an unrefined culture that can be toxic.

Some leaders like former president and CEO of Yahoo, Marissa Mayer, are defending Kalanick. She said that because Uber scaled so quickly, it was difficult for him to know about the toxic culture.

“Regardless if Kalanick knew the extent of Uber’s sexist corporate culture, the truth of the matter is that diversity and inclusion were not embraced from the get-go,” said Frans Johansson, author of The Medici Effect and CEO of The Medici Group, a business management consultancy firm.

He pointed out the value of keeping diversity in mind from the beginning.

“When you don’t embrace those with different backgrounds or experiences, that’s when companies start to back themselves into a corner, both from an acceptance and a creativity standpoint,” said Johansson. “The most successful businesses actually make diverse hiring a priority.”

Focus your culture on diversity. Once you identify your workforce needs and how you want your staff to represent your culture, create a hiring strategy that aims to hire people with various backgrounds.

To prevent your culture from turning toxic, check in with team leaders regularly. When you survey your staff, you can track levels of engagement and satisfaction and make adjustments if issues start to arise.

Know the rules change.

Deborah Searcy, PhD, a faculty member of the Department of Management at Florida Atlantic University, identified one of Kalanick’s biggest mistake — he tried to apply what worked in a small startup to a multi-national, billion-dollar company.

“Uber’s success came from his ‘ask forgiveness’ attitude,” she said. “He ended markets where everything except taxis were basically illegal, but believed that Uber was so incredible that customers would lobby for local governments to change laws, which they did. But this attitude can’t continue in a publicly-traded company with billions of dollars of other people’s money invested.”

When a company gets bigger, it’s hard for it to fly under the radar on things that might be less ethical. For example, Uber’s Greyball, a tool that collected data from the Uber app to identify and evade officials in certain cities, rose some ethical questions.

Tools like Viventium can help keep companies compliant in regards to HR law as they grow. The software provides products like mock audits, which are modelled after the DOL audit, risk consulting, and customized HR action plans.

Think long-term.

As a company grows, it’s important for the CEO to continue to grow and learn as well. As Ben Brooks, CEO of PILOT, a career improvement company, pointed out, Kalanick didn’t grow as a leader at the same rate his business did.

“Growing a business, while certainly difficult, is often less complex and confronting than growing one’s own abilities and stepping beyond known comfort zones,” Brooks said. “Founders will often double down on their strengths and stick to what they know. They fail to address fatal flaws that eventually lead to their exit.”

For CEOs to grow and learn, they need to have a long-term plan, then execute experiments to learn.

“One of the many things I learned was that I had to be far more agile and test things sooner,” he said. “My corporate background (my last role was as a SVP of a big global firm) taught me to make long-range plans and then get busy executing.”

If leaders learn and grow along with their company and think long-term, they can find leadership strategies that are both effective and sustainable.

Treat people like people.

While there’s no doubt Kalanick was a true visionary, he forgot to focus on the people who worked for him. For starters, he cut pay for drivers and made it difficult for them to get tips.

Henry Albrecht, CEO of Limeade, a corporate wellness technology company, noted that success is only sustained when cultures and leadership strategies are centered on employee well-being.

“Uber built something remarkable in a short period of time,” he said. “But if they want to sustain their growth, they’ll need to create a culture that treats people like people. Our research found that when employees believe their employer cares about their well-being, they’re 38 percent more engaged.”

Retention and long-term success comes when leaders treat their staff like people, not assets. Remember, as a leader, you set the tone. Ensure you’re showing respect and making your employees feel valued and cared for.