Uber’s Future is Now in Question

A few years ago, Uber appeared to be on its way to becoming one of the most powerful companies in the world with its plans to transform work, lower traffic congestion in major cities, and even roll out self-driving vehicles. Behind Uber’s genius was an obsession with using data to make the very best decisions about how to operate and expand. In recent months, however, Uber’s CEO and the company at large have come under growing scrutiny for everything from sexism in the workplace to duping local police attempting to crack down on the company. Now, the future of Uber is looking grim and many are wondering if its data-savvy CEO, Travis Kalanick, will survive.

Poorly Managed Labor Disputes

Early on, Uber drivers challenged the company’s position that while they are not employees, they are subject to myriad of regulations. For example, while Uber drivers are asked to supply their own vehicles and are not compensated for expenses, they are also not permitted to set prices and regularly disciplined for not complying with Uber’s driver rules. In short, Uber wants its drivers to behave like employees (e.g., not set prices) but without any employee benefits (e.g., vacation pay or guaranteed work). The lawsuit is still ongoing as Uber continues to stall proceedings.

“Greyballing” Authorities

While Uber’s strained labor relationships may be its most longstanding dispute, recent news suggests that the company is about to go head-to-head with law enforcement agencies too. As reported in the New York Times on March 3, “Uber has for years engaged in a worldwide program to deceive the authorities in markets where its low-cost ride-hailing service was resisted by law enforcement or, in some instances, had been banned. The program, involving a tool called Greyball, uses data collected from the Uber app and other techniques to identify and circumvent officials who were trying to clamp down on the ride-hailing service. Uber used these methods to evade the authorities in cities like Boston, Paris and Las Vegas, and in countries like Australia, China and South Korea.”

Sexism in the Workplace

As widely reported over the past two weeks, Uber’s head office if also rife with workplace gender discrimination and sexual harassment complaints. In an open letter, Susan Fowler, a former Uber engineer, recently explained, “On my first official day rotating on the team, my new manager sent me a string of messages over company chat. He was in an open relationship, he said, and his girlfriend was having an easy time finding new partners but he wasn’t. He was trying to stay out of trouble at work, he said, but he couldn’t help getting in trouble, because he was looking for women to have sex with. It was clear that he was trying to get me to have sex with him, and it was so clearly out of line that I immediately took screenshots of these chat messages and reported him to HR.” When Fowler went to HR, however, nothing was done to discipline the harasser and worse yet, Fowler was forced to work on a different team, where she was still ultimately subject to negative performance reviews. The treatment of her case and several other former women employees’ cases are now under investigation.

Potential Theft of Intellectual Property

While Uber continues to deny the accusations, in late February, Waymo, a self-driving car business based at Google, claimed that Uber was using intellectual property stolen by one of Google’s former project leaders to drive its self-driving car development.  Allegedly, Anthony Levandowski, who is in charge of Uber’s autonomous car division, downloaded an estimated 14,000 files from Google just a month before leaving to start Otto (a company that Uber in turn acquired).

Getting Involved in Politics

If Uber’s ongoing disputes with drivers, dodging of public authorities, dismissal of sexual harassment complaints in the workplace and potential theft of intellectual property was not enough, CEO Travis Kalanick has also landed in hot water for wading into U.S. politics. In January, Kalanick joined a President Trump initiated advisory council on economics but later resigned when thousands of Uber users decided to delete the Uber app from their phones.

What can businesses learn from Uber’s ongoing disputes? What nearly all of the above errors and disputes point to is a company and CEO driven by greed rather than ethics. While one might argue that Kalanick is simply doing what one does in business (taking care of his bottom line), as more consumers, employees and investors turn their attention to the value of ethics, culture and social entrepreneurship, there is good reason to wonder whether Uber will be a company with the power to drive into the future or become permanently stalled.

March 4, 2017   Updated :March 4, 2017      

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