Over the past year multiple companies have used “I’m Sorry” as a way of managing reputational damage.
After Wells Fargo’s Re-Established and Facebook’s Here Together campaigns, in May 2018 Uber joins the ranks with their Moving Forward promise. The campaign video, narrated by Uber’s new CEO, Dara Khosrowshahi, introduces Uber’s new direction and promise to its stakeholders.
But has this ad effort affected Uber’s corporate reputation? And if so, how exactly?
Uber appeared in news headlines frequently throughout the past year and a half. The majority of those headlines painted a negative image of Uber’s leadership, culture and morals. Uber’s scandal repertoire ranged from multiple sexual harassment allegations and reported rape cases to Travis Kalanick’s (Uber’s former CEO and co-founder) position on Trump’s Advisory Council, not to mention the self-driving car fatality.
The multiple fingers pointing at Kalanick’s personality and leadership style ultimately lead to his resignation in June 2017. Dara Khosrowshahi, previously CEO of Expedia, Inc., stepped into the tainted Uber CEO seat two months after Kalanick’s leave.
Figure 1: Uber’s Reputation in the US (January 2017 – May/June 2018)
Uber’s reputation plummeted in December 2017 and continued to decline in 2018, moving from a high range average reputation at the beginning of 2017 to a weak one in 2018 (Figure 1). Uber’s year-over-year reputation decline is a whopping 8-point drop – 5 points higher than the statistically significant threshold.
With a reputation downturn, stakeholder support levels follow suit. Between January 2017 and June 2018, the levels of trust in Uber among the general public has declined by 15.0% points, a significant dip. Only one-third of respondents put their trust in Uber, down from one-half.
The aforementioned scandals, festering over a long period of time, have created a toxic environment for Uber and the quick leadership change hasn’t automatically turned into a reputation recovery. For Uber, the wounds run deep.
Figure 2: Uber Dimension Scores in the US (January 2017 vs. May/June 2018)
Reputation Institute’s RepTrak® data captured the sandals’ damaging impact across all dimensions of reputation. As shown in Figure 2, the affliction is particularly harsh when it comes to Uber’s leadership execution, workplace culture, ethical moral practices, product quality, and their role as global citizen,
Clearly, Uber’s new CEO and leadership team have many challenges to remedy from the reputational damage afflicted by their predecessors.
In tow with the Moving Forward campaign, Uber’s reputation is slowly starting to regain reputational momentum, yet is barely back in the average range (Figure 1).
Khosrowshahi’s untarnished reputation in conjunction with the Moving Forward initiative deliver an injection of good will with the hopes to eradicate Uber’s toxic ecosystem. Unlike the company, Uber’s CEO enjoys a strong reputation score of 74.1 and strong scores across all four CEO dimensions; especially when it comes to his leadership and company management (Figure 3).
Figure 3: Khosrowshahi’s Reputation/Dimensions Scores in the US
(CEO RepTrak®, May/June 2018)
Besides his personal reputational stronghold, Khosrowshahi has a positive impact on Uber’s reputation. As presented in Figure 4, Khosrowshahi provides a 5.2-point lift in reputation, and among the seven dimensions of reputation, he particularly impacts Citizenship (+11.7 points), Leadership (+9.3 points), Workplace and Innovation (+6.8 points).
Figure 4: Dara Khosrowshahi’s Impact on Uber’s Reputation in the US
(May/June 2018 data)
While Khosrowshahi clearly provides a positive beginning for Uber’s next chapter, this reputational change is nascent and will take time to translate into tangible results.
Khosrowshahi’s first major initiative towards Uber’s recovery, the Moving Forward campaign, is a great start, but nevertheless, only a start. In an age of CEO activism, Uber is taking the right step by unleashing the voice of its new CEO to mend the emotional connection.
Within weeks on the job, Khosrowshahi introduced a new mantra to his employees: “We do the right thing, period.” He expands on this new company direction in the commercial video. Specifically, Khosrowshahi makes promise on the reputational dimensions on which Uber has previously failed to deliver (Figure 2). He speaks of Citizenship – “priority…to listen to you, to cities and communities”; Governance – “core [value] as a company is to always do the right thing…we commit to being open, taking responsibility for the problem and fixing it”; Leadership and Workplace – “this [new direction] beings with new leadership and a new culture” and products – “improvements to our service…better pickups and ride quality for both riders and drivers.”
Yes, Khosrowshahi has placed the first injection of good will; however, a lot more has to be done to move Uber’s reputation needle in a positive direction, to its’ pre-scandal level (and ideally beyond).
To truly heal Uber’s reputation, Khosrowshahi and the new leadership need to:
- Deliver on promises. Even for an industry-disruptor like Uber, there is little space for error and second chances. Stakeholders are unforgiving. In order to drive significant change, expectations must be met.
- Re-install trust. Be authentic. Show empathy, but provide logic in your actions. Appeal to both the emotional and rational stakeholder segments.
- Introduce real change. Take action to remove anything and any one that inhibits true change. Make decisions that deliver the most impact for a change-based leadership team and company.