Dara Khosrowshahi recently took over as Uber's chief executive, and things seemed to be going well. I've admired his early efforts to encourage employees to engage in more self-reflection and perspective-taking, as well as to change both the direction and public image of the company.
However, a recent email Khosrowshahi sent to employees sends a powerful message about Uber's former CEO, Travis Kalanick--and this time, it's not the good kind.
First, some context, in case you haven't been following the most recent developments at Uber:
- Last June, Uber CEO Travis Kalanick was pushed out of his position by unhappy investors, due to what was seen as general mismanagement and a series of scandals (although Kalanick retained a seat on Uber's board of directors)
- After a two-month search, Uber's board named Expedia CEO Dara Khosrowshahi as the new chief executive
- On Friday, Kalanick used powers previously granted him to appoint two new members to the board: former Xerox chief executive Ursula Burns and former Merrill Lynch chief executive John Thain. The move was seen by many as an attempt by Kalanick to place allies on the board.
But why the sudden move by Kalanick?
As reported by The New York Times:
The trigger...was a proposal that Mr. Khosrowshahi and the investment bank Goldman Sachs, an Uber shareholder, brought to the board on Thursday. The proposal, which is set to be discussed by directors on Tuesday, includes measures that would shift the power on Uber's board by reducing Mr. Kalanick's voting clout, expanding Mr. Khosrowshahi's powers, and imposing a 2019 deadline on the company to go public, according to three people with knowledge of the proposal who asked to remain anonymous because they were not authorized to speak publicly.
The power shift proposed by Mr. Khosrowshahi and Goldman Sachs spurred Mr. Kalanick to act to reassert control, according to a statement Mr. Kalanick issued on Friday. That has now plunged Uber into another period of uncertainty and a corporate governance crisis, at a time when the company had been trying to move beyond its controversial past with a new chief executive on board.
Of course, this is just the tip of the iceberg--but it gives us a glimpse of the deep divide to which Uber has fallen victim.
And that's what makes Khosrowshahi's response so troubling.
Harmful Instead of Helpful
Knowing that Uber employees would learn of the news quickly, Khosrowshahi attempted to assuage their fears with the following email (first obtained by Recode):
I wanted to update you on some disappointing news from today. Travis appointed two new members to Uber's Board without discussing it with me or the Board of Directors more broadly. Anyone would tell you that this is highly unusual.
If your family or friends ask you about it, here is our press statement:
"The appointments of Ms. Burns and Mr. Thain to Uber's Board of Directors came as a complete surprise to Uber and its Board. That is precisely why we are working to put in place world-class governance to ensure that we are building a company every employee and shareholder can be proud of."
Just know that the most important work here is the hard work you're doing on behalf of our Company. Keep focused, keep together, and keep going.
Just last week, I lauded a separate email from Khosrowshahi to Uber staff, which I felt showed great signs of emotional intelligence (the topic of my forthcoming book). But even someone with a high EQ can make a major mistake, and that's how I see this email.
Why? For the following two reasons:
1. It's disrespectful.
To be honest, Kalanick's attempt to secure added influence on the board is no surprise. After all, what prompted this move were actions that would further reduce his role at a company he co-founded. A company to which he's invested the last decade of his life, and where he has been the major influencer from the beginning.
This is the point Khosrowshahi's email misses: Uber is still Kalanick's baby. And despite Kalanick's serious mistakes, he's obviously worked extremely hard to get the company where it is today. To paint his recent moves as "unusual" takes none of this into account.
2. It promotes disunity.
Khosrowshahi encourages his team to "keep focused, keep together, and keep going"--but this email doesn't do anything to promote that type of spirit.
It's like if your dad says your family needs to improve their ability to work together, and then calls out your mom's actions as "disappointing" and "highly unusual."
Kalanick may be paying for his mistakes, but to his credit, he did step down as CEO. As the co-founder and a current board member, he's still an important part of the company, with loads of valuable experience and a voice that shouldn't be shut out. And until these recent events, he's been supportive of Khosrowshahi as the new CEO (at least publicly)--something that's extremely difficult under these circumstances.
To be clear, I'm not praising Kalanick's recent moves--but I do understand them. Both Khosrowshahi and Kalanick would do well to realize that each has Uber's best interests at heart, and the best way to move forward is to find a way to work together and learn from each other.
Hopefully for Uber, it's not too late to do just that.