Please answer the question in the title before you proceed any further.
But I’ve started to seriously question that belief after the last few months’ events at Uber.
You know about Uber’s recent woes, right? Susan Fowler’s blog post, Travis Kalanick’s meltdown in his own company’s car, lots of top execs leaving. It’s never been a big secret that Uber’s culture is a dumpster fire, much of it being a direct reflection of the CEO’s personality (read this, this, this, this, this, this, this, this or this.) But Q1 of 2017 was a perfect storm for the company.
In response, Kalanick said:
I must fundamentally change as a leader and grow up. This is the first time I’ve been willing to admit that I need leadership help and I intend to get it.
Around this time, Yahoo Finance interviewed 5 other Silicon Valley CEOs and asked them what the besieged CEO should do. Can you guess what they said?
Despite all the scandals and the reports of a terrible company culture, their verdict was that Kalanick should not resign. Here are some quotes:
“Him stepping down would be the worst outcome, because the only person that could really change it is him. If they put in someone else, does that person really have the power to change the culture? I think that’s unlikely.”
“He’s a phenomenal entrepreneur, he created a phenomenal business extremely quickly,” says one sports-tech CEO. “The business that he is in, they’re going up against car companies, Google, so many big giants, and to actually build a successful startup in that sphere is really impressive.”
“I think Uber is a really special company,” says the CEO of a finance-related tech platform. “Being able to grow it so fast and scale it so much was really hard, and people don’t appreciate that enough.”
“I’d be surprised if anyone who’s a CEO or founder would say he should step down,” says the CEO of an events-related tech platform. “If they’re saying that, they’re not putting themselves in his shoes. Despite all the backlash, he’s still responsible for building an extremely successful company.”
Two of them both brought up the same example of another hard-charging, pugnacious business leader: Steve Jobs. “He wasn’t exactly known for being a nice guy, right,” says one CEO; “I don’t think Apple’s been a super cuddly corporation, because of its founder, and Uber is like that,” says another. And two brought up the same example of a company that often alienates employees and finds itself in the news for negative reasons, but thrives nonetheless: Comcast. “Most of us don’t feel good about Comcast, but that doesn’t stop us,” says one CEO.
At the same time, they admit there’s not much hope for real change:
Four of the five CEOs we spoke with expressed serious doubt that Kalanick himself could actually change his demeanor.
In other words, here’s what they think about empathy in leadership:
This shouldn’t really come as a surprise. As my wife, much more of a realist than me, puts it:
“As long as you deliver the numbers, no one cares if you’re an asshole or not.”
Sounds too harsh? Remember when Jetblue’s CEO was fired for being too focused on customers and not enough on meeting Wall Street targets?
What exactly is missing at Uber?
I’m going to borrow a metaphor from the book Radical Candor, where author Kim Scott presents the following matrix:
Scott was talking about honest feedback here, but it works equally well in our context: there really is an orthogonal relationship between results (“challenge directly”) and empathy (“care personally”).
The problem with Uber, of course, is that it lives entirely in the bottom right. Their leadership culture is all about winning, with near-zero concern for their customers, drivers, or employees.
The real need is for a balance between results and empathy. Great leaders challenge their teams and give them the support needed to grow, make mistakes and learn. Results keep the business alive, empathy keeps the company’s biggest asset - the employees - happy and growing. That’s what ensures the company’s long term future.
Achieving that balance is tricky, and that’s what getting a culture right is about.
Interestingly, here’s one of the counterintuitive notes in Scott’s book:
“Now, let me be totally clear. I hate working with jerks. You’re not shooting for second best,” Scott says. But when you challenge directly without caring personally, you fall into the quadrant that Scott calls obnoxious aggression. Which is bad, but better than not challenging directly.
Which, interpreted in my context, means “at least get good results.” Which is why, I think, Kalanick gets a pass from other Silicon Valley CEOs. He may be an asshole but at least he’s built a successful business.
Is it necessary for Kalanick to change?
Does the balance of support and challenge need to reside in a single individual? Not necessarily. A balanced organization, with lots of empathetic leaders, can compensate for a few extreme personalities. But if left unchecked, the culture will be overrun the way Uber’s has. You need that buffer.
Where can you find that buffer? Where do you find leaders who can deliver results while nurturing the human ecosystem around Uber - its employees, drivers and customers?
A closer look at Corporate Hierarchy
Have you ever seen this comic by Hugh MacLeod?
I laughed out loud the first time I saw this… but there’s a lot of depth there. (p.s. Think about it for a second before you proceed. And if it still really bothers you, go read the more nuanced discussions here and here.)
My personal hypothesis is that it’s that middle layer, which MacLeod calls “clueless” and the rest of us call “middle managers”, “supervisors” or “young leaders”, that provides the backbone of empathy so crucial for a balanced organization. And it’s that layer that is either missing, or corrupted, at Uber.
Want some data? In a recent analysis of Leadership performance, HBR evaluated leaders around 2 axes: business results and team satisfaction. Some key findings (directly quoted from the article):
- Leaders who were rated in the top quartile of both skills ranked in the 91st percentile of all leaders.
- There aren’t very many of them — we found that only 13% of leaders in our data set fit this profile.
- Younger leaders excelled in this ability to run an effective and fun team environment. We found that leaders who were under 30 years of age were two to three times as likely to be effective at both results and engagement than their older compatriots. Nearly one-third of the group under 30 years of age achieved both priorities well. Around age 40, it seems, leaders appear to have made their choice between being results driven or interpersonally strong. From there forward, only 10% of leaders in any age group would do both things well.**
- We also wondered if the results we found correlated not with age (or not only with it), but with position. And indeed, that’s what we found. Supervisors are much more likely to carry both capabilities than senior managers, we found. In fact, supervisors are twice as likely to do both things well than senior managers. In this case we did see some decline in both skills with age, but people skills declined more than drive for results as leaders moved from supervisor to top management. Both skills decline with age, and age and position are strongly correlated with each other.
Here’s another piece of data from a smaller sample set (viz. companies I have worked for): in mid-to-large organizations, a specific type of personality congregates at the top: highly driven, impatient, results-oriented, hypercompetitive. Their personality profile would likely be near the top of the D-I quadrant:
Don’t get me wrong, not all CEOs are terrible. But the overwhelming tendency is for people at the top to be results-focused rather than people-oriented. Our corporate culture and media worship leaders who deliver results, who “crush the competition”: from Neutron Jack Welch to the young Steve Jobs, Bill Gates, Larry Ellison, to Travis Kalanick and Marissa Mayer today.
On the opposite end of the spectrum, note that the traits of collaboration, support etc. are line-worker traits. These are also highly correlated with a desire for stability and accuracy of work (what you’d call craftsmanship).
So, what does Uber need most of all? A cadre of strong and empathetic leadership in the middle. Ironically to achieve that, the top leadership needs to change; but that is only the conduit to the ultimate goal: hire or grow that middle layer of talented leaders. Folks who will achieve the balance of results and empathy at the ground level. Who will stand up to top management’s crazy drives. And, with any luck, will form a future generation of top executives that isn’t just focused on the bottom line.