Quora: What is Uber's Fate Without Travis Kalanick?

Travis Kalanick
Uber CEO Travis Kalanick is embraced prior to an address to employees and drivers marking the company's five year anniversary, in San Francisco, California June 3, 2015. Kalanick announced he is resigning on June 21, 2017. Robert Galbraith/Reuters

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Answer from Shefaly Yogendra, Founded and built a luxe venture:

As soon as the news broke on the morning of June 21st, 2017 that Travis Kalanick had resigned, I noticed on all my social media channels a whoop of joy. That is most people’s instinctive response to his resignation.

I disagree that Uber will be better off now that he has resigned.

Here is an excerpt from the New York Times article:

Mr. Kalanick’s exit came under pressure after hours of drama involving Uber’s investors, according to two people with knowledge of the situation, who asked to remain anonymous because the details were confidential.

Earlier on Tuesday, five of Uber’s major investors demanded that the chief executive resign immediately. The investors included one of Uber’s biggest shareholders, the venture capital firm Benchmark, which has one of its partners, Bill Gurley, on Uber’s board. The investors made their demand for Mr. Kalanick to step down in a letter delivered to the chief executive while he was in Chicago, said the people with knowledge of the situation.

The article further mentions:

He will remain on Uber’s board of directors.

It is worth noting that the investors now in revolt are those who served for months, sometimes years, while Uber’s toxic culture was being discussed loudly around the world. A quick look at Google search results for “Uber’s toxic culture” between the periods 2014–2016 speaks for itself. The volume kept rising till Susan Fowler, a former engineer at Uber raised her voice with a blog post in February 2017.

This is when the board found it unavoidable to take action. Whether anyone raised issues about the unacceptability of the culture earlier than this blog post is now moot. With the best of intentions, the board has presided over all of these developments just as much as Travis Kalanick has.

To point this out is not to say Travis Kalanick shares no blame.

However, when a board made up of investors of a company allows a toxic culture to flourish, they may not wash their hands of the whole thing by forcing the CEO, and one of the major shareholders, to resign.

The duties of directors are several, including the duty to promote the success of the company and the duty to avoid conflicts of interest. But most crucially, they include the duty to exercise independent judgment and the duty to exercise reasonable care and diligence.

By letting things to come to a head when a former employee’s whistleblowing is the catalyst for the board to act, it would not be unfair to say the board had not exercised good judgment or diligence or care.

The same board directors, more or less, now continue to serve the company. Given this, I find it difficult to get excessively optimistic about the future of Uber.

It is worth noting that the culture of an organisation does not change overnight. The company, with its poor reputation, is having trouble attracting people, and at the time of writing, is without CXOs i.e. without a CEO, a COO, a CMO, a CFO or SVP of Engineering. This is not a good situation. And one that may not improve overnight with Travis Kalanick’s departure from the executive suite.

Is Uber better off now that Travis Kalanick has resigned as CEO? originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world. You can follow Quora on Twitter, Facebook, and Google+. More questions: