Uber’s PR Crisis: Can PR Solve its Underlying Problem?

Uber, known for its ride-sourcing app, has suffered a serious and long-lasting public relations crisis. While single incidents cause most PR crises, a long list of incidents caused Uber’s PR problems: Sexual assaults by Uber drivers. Accusations of a sexist, frat house-like company culture. Departures of high-level executives. Allegations that it stole Google’s self-driving car patents. Software that defrauded its drivers and customers. Reports of transportation and safety issues.

Under pressure from unending public perception problems, CEO and co-founder Travis Kalanick resigned last week upon request of investors on the Board of Directors.

Time to Reform Its Corporate Culture

Observers say PR responses can go only so far in improving Uber’s image. To save its reputation, it must reform its corporate culture.

Uber issued proper PR responses that follow the standard playbook, such as quick apologies and promises to investigate, after negative news reports. But even the best PR cannot change the company’s ingrained lack of respect for the law, says Nikita Rana.

“Uber has been flouting rules since the day it was born,” Rana says. “The cost advantages that the company has over rivals are largely because of the use of non-commercial vehicles and all the money it saves by going around laws that require its cars and drivers to have commercial insurance, special drivers’ licenses, vehicle inspections and many other requirements that make a business legitimate.”

A Silicon Valley Tech Firm Issue

Uber’s difficulties and Kalanick’s ouster expose the ugly corporate culture of Silicon Valley tech companies, says Vivek Wadhwa, a distinguished fellow at Carnegie Mellon University College of Engineering.

“For too long, its elite have gotten away with sexism, ageism, and, to coin a word, unethicalism,” writes Wadhwa, director of research at Duke University’s Pratt School of Engineering, in LinkedIn Pulse. “Silicon Valley got a free pass when computers were just for nerds and hobbyists. Few cared about its arrogance and insularity, because its companies were building products for people who looked just like their founders.”

Those days are over. Uber — and Silicon Valley tech firms in general — must clean up their act and embrace professionalism, maturity and corporate social responsibility, he stresses. To start, it can adopt procedures like blind résumé reviews, interviewing at least one woman and one minority candidate for each open position, limiting alcohol at work events and in the office, and banning employee–manager relationships.

Self-inflicted Crises

While its corporate culture was a major factor, Uber’s crises were self-inflicted and largely caused by poorly managed public relations, says Mike Valdes-Fauli, president and CEO of marketing agency Pinta.

Valdes-Fauli recommends how other companies can avoid Uber’s predicament in a Miami Herald column.

Foster an ethical culture. Don’t promote an overly aggressive corporate culture at the expense of ethical business practices and respect for others.

Set an example. Kalanick could have set the tone from the start. He was recorded ranting at one of his drivers and exclaiming off-color comments about the company.

Consider all stakeholders. Bragging it focused on “growth at any cost,” Uber placed a priority on investors. It neglected other stakeholder groups like its employees, contractors, board of directors, watchdog groups, bloggers and the media.

Watch your words. An Uber board member recently resigned over a sexist joke. It’s critical to consider the ramifications of words as well as actions.

Bottom Line: A horrid corporate culture is the root problem of Uber’s continual PR crises. Other companies, especially start-ups, can learn a lesson from Uber’s difficulties. Although PR response can address individual incidents, fostering a corporate culture that emphasizes respect, ethics and professionalism is essential to protect the brand’s reputation. And that requires leadership from the chief executive.