How to Survive

Let’s consider the story of Uber. The scandal shocked us all with reports of harassment, a hostile work environment and violations of basic business standards. People wanted to know, “How is it possible that this behavior was permitted?” To answer that question, we have to take a look at who had the most influence on Uber’s culture – former CEO Travis Kalanick.

Kalanick’s win-at-all-costs attitude may have contributed to Uber’s early success, but it became more of an Achilles heel as the company grew. Like so many visionary leaders who shoot to the top only to fall from grace, Kalanick’s influence and tone permeated throughout the company which resulted in an unhealthy work environment – and resounding damage to Uber’s reputation.

 

 

1. Build and Use Your (Corporate) Backbone

The backbone of every compliance program is its policies and procedures. Coupled with internal controls, these all operate to prevent both illegal and unethical conduct. Policies and procedures make a business run more efficiently and at the end of the day, contributes to a healthy culture. Having such controls in place can allow for fast-growth to move forward in a compliant manner.

In the case of Uber, the organization was built on an improvised approach to management that transcended internal controls. Putting effective policies and procedures in place ensures rules apply to all individuals at every level of the organization, including the leader.
 

2. Call for Back Up
Sometimes you just need some experienced professionals in the room, like your board. However, the board is not simply there to be a backstop. Board members are seasoned professionals who not only bring business acumen into a situation, but they also provide counsel on the soft skills that can take a business leader from good to great.

The Uber board stepped up and told Kalanick he had to resign as CEO, not simply take an extended leave of absence. The result was reallocating responsibilities to provide a broader, more reliable tone from the top. 
 

3. Avoid Growing Pains

One of the keys to making a startup successful is the ability to scale correctly. Smaller companies need to begin thinking about building a compliance program early on. This means starting off on the right foot with a strong code of conduct,  a functional HR department that meets the minimum standard for following U.S. and state employment law, and a CFO to bring financial discipline into the company.

Uber was emblematic of not only the Silicon Valley frat-boy culture, but also of a successful startup that grew faster than its compliance program and ethical culture. Given the proper safeguards, Uber may have been able to avoid their recent horrors if they had developed a proactive, robust ethics and compliance program before their rapid expansion.