By the time Uber founder and CEO Travis Kalanick was driven out of the company, it had become something of a given. Many unsavoury details about Uber’s work culture—how its management brushed allegations of sexual harassment under the carpet to retain talent—and controversies centred on top officials, including Kalanick himself (his infamous argument with a Uber driver) had come to light in the last 5-6 months. Many, within Uber and outside, had blamed it on Kalanick’s “bro culture” style of running the company. Though Uber recently adopted all recommendations by former US attorney general Eric Holder who it had hired for a review of its practices, the battering that its image had already taken forced the hands of investors.
The question that many are asking if investors were right in pushing out Uber’s founder-leader, who steered the company to vertiginous heights of valuation. That’s a difficult question to answer; many companies, it is true, have succeeded after splitting with founders, but many have failed spectacularly, too. JetBlue, an American budget airline, did well after it showed founder David Neeleman the door. Tesla shrugged off co-founder Martin Eberhard’s departure with soaring valuations. At the same time, American Apparel, seems to have lost the plot after it let go of controversial founder Dov Charney, while Apple had to bring back the legendary Steve Jobs a decade after it had thrown him out.
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Research published in The Leadership Quarterly finds toxic or unethical leaders can do a lot of damage to their organisations. However, Elaine Ou of Bloomberg argues that though Uber’s valuation and reach would make it seem like an established corporation, “appropriate culture isn’t a function of size or age”. That line of thought would perhaps suggest that Kalanick’s aggression was what drove Uber to its stellar heights, and firing the founder so early in evolution may bode ill. That said, whoever the company now appoints as CEO, she has to be someone who can stoke growth but not the lawsuits that the Kalanick tenure saw.