For every Silicon Valley success story, it seems there is another example of a promising startup that collapses under the weight of mismanagement. What can small business owners learn from these high-profile mistakes?
The Blog That (Almost) Took Down Uber
Not that long ago, über wasn’t a verb. But that changed in June 2010, when a mobile ride-share app was launched. As we all know, it later grew into a worldwide logistics powerhouse – one that very nearly crashed and burned in 2017.
That was the year a former employee went public with claims of sexual harassment and gender discrimination, claims that were ultimately investigated and found to be legitimate. In the wake the public and embarrassing scandal, more than 20 Uber employees were fired and one board member resigned.
The repercussions for Uber have been significant.
- Negative opinions of the company rose from 30% to 57%
- Uber became a symbol of everything that is wrong with the tech industry’s “brogrammer” culture – a crass and unwelcoming work environment
- A globally trending #deleteuber campaign that encouraged consumers to “vote with their wallets” and delete their Uber apps in favor of its competition; an estimated 1,000,000 consumers are believed to have done just that
- Uber’s main competitor saw their market share double in the aftermath of the scandal
So, how did a company like Uber, awash in money and prestige, go so wrong? And what are the lessons here for small businesses?
Charisma Isn’t a Substitute for Compliance
Many startups learn that the hard-charging, dynamic personalities of their founders can – if left unchecked – lead them to dangerous waters.
The best leaders exhibit a balance of passion and discretion, with the latter including a healthy respect for the law and labor law compliance.
- Know the employment laws that impact your business; if you don’t know, hire a consultant and empower them help you
- Embrace training; your entire management team is legally responsible for labor law compliance
- Encourage open communication; a process that doesn’t provide employees an internal avenue for whistleblowing is one that, by default, encourages them to hire an outside attorney
Consider Your Culture
No one wants to be the behavior police – not the founder of a startup nor their HR team. We all have more important things to do. It’s okay to operate under the assumption that your employees are adults and capable of making appropriate decisions, but as business owner, you’re obligated to take it a step further, by ensuring that:
- Your corporate culture encourages them to behave as adults. Open Bar Fridays? Let’s go ahead and cancel those.
- Your leadership sets a reasonable example. See previous note about Open Bar Fridays. Also, supporting fair and equal pay practices is a wonderful example of leadership, while rating female employees on a “hotness scale” does not.
- You’re hiring a diverse and respectful workforce. When someone shows you that they are not capable of behaving in an acceptable manner, take action to protect your company.
Remember the Golden Rule
It’s amazing how complicated and regulated the business world has become, when most people are striving for the same, simple thing – to be treated with respect and dignity in the workplace.
- Treat people fairly – employees, contractors, customers, and vendors. Remember that your community extends beyond the walls of your building. Every interaction is an opportunity to build goodwill.
- As a small business owner, you are your company. In this age of social media, bad publicity will find its way back to you. Strive to be known as a source of positivity in your community.
- Embrace our differences. A company should reflect the community it operates within. If there is a lack of diversity within your company, take the time to find out why – and what you can do to reverse that trend.
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