Uber: Beware Diversity Debt

The need for speed in business does not excuse an organization from taking the time to create and execute a thoughtful, sincere and diversity-friendly talent strategy – not when your customers and employee base are potentially diverse.

Ask Uber. The company is finding that out firsthand given the rash of problems the once exalted startup is facing. Reports of sexual harassment, senior executives resigning for similar reasons, and then this week Uber CEO Travis Kalanick was caught on camera in a confrontation with one of his own drivers.

The company’s image is in the toilet. It even has a hashtag: #DeleteUber. Or, as Susan Wu cleverly stated in a recent article on backchannel.com, “We need a Chapter 11 for company culture and diversity. Uber needs to declare diversity bankruptcy.”

Her bio said Wu is an internet entrepreneur and angel investor, so I imagine she has firsthand knowledge of finance, technology and diversity. She was certainly clear about Uber’s missteps:

“How do companies incur diversity debt? Take a couple of cofounders and their cognitive biases, add a second seed round where they’re faced with the existential imperative of finding product-market fit, and whirl in the velocity of needing to “just get things done” in a very short timeframe.

After all that, poof. Uber’s image goes up in smoke. But I was struck by her comparison between financial and diversity debt. With money, you borrow, accumulate interest, if you’re a good borrower, eventually you repay both principal and interest. If you’re not, you declare bankruptcy.

Wu wrote that the startup industry is primed to accumulate debt. It’s essentially the price of doing business very quickly. But when that debt is diversity debt, a toxic culture, pervasive bias, talent management and/or leadership issues – and in Uber’s case the length of time these issues go unchecked – not even a cultural makeover may help. Not when your reputation in the marketplace, what Wu calls a company’s “fundamental goodwill,” is deeply tarnished.

Like so many things diversity-related, when it comes to problems or challenges, it’s best to begin with the foundation. A company’s foundation is set with its first few hires. Wu agreed. “Nearly all startups choose to opt for speed, believing that hiring from existing friends-of-friends networks will be more effective than working hard to recruit candidates with a range of race, gender, and socioeconomic backgrounds.”

I can understand that. In the name of speed to market, a congenial work environment, late nights and in the case of technology, like minds and skill sets, you go with the familiar. But what about after the foundational concrete has been set? Once things are up and running, it’s time to think strategically, and sometimes that means asking some tough, certainly direct, questions and finding the answers: Who are our customers? How do our employees treat them? Do our employees know them? If not, how can we get to know them? Who are our leaders? What do they know, and who do they know? How do we look to the global marketplace?

Of course, it makes sense that I would think like that. I’m black, I’m a woman, and I work in media with a focus on HR and talent management. I’m knee deep in best practices. The thing is, not being black or a woman or knee deep in HR best practices is not an excuse for ignorance or bad behavior. Not these days.

If you’re unaware, you can maybe leverage that excuse for one free pass. After that, the public, your employees, your investors and certainly your customers, they expect – no, they demand – that you wise up. That you see the flowers and the trees. Uber’s on pass, like, 70.

And leaders can’t try the old, ‘we don’t have time to look for diverse talent,’ complaint either. There are literally apps out there to help with diverse recruiting, not to mention niche staffing agencies, the Internet, social media, you can see why the excuses get old fast.

“Once you start to think of homogeneous hiring practices as a debt–one that limits your ability to cultivate a strong portfolio of diverse employees and diverse ideas that can yield greater potential upsides and serendipity for your company–then you’re in a much better position to choose which diversity debt you’re willing to live with,” Wu wrote.

Most adults owe something. Credit is akin to life for many of us. But if you don’t watch it, that interest will kill you. In that way, diversity debt is no different than its financial counterpart. You don’t attack the principal, you keep adding to it, you end up in a real pickle.

Uber hasn’t sufficiently addressed the fundamental workplace culture and diversity issues that have plagued it from the very beginning. HR and talent management, marketing, engineering, safety, these systems are all broken. And it likely will take some drastic action to fix them. We’re talking big time firings in order “to start cleaning house,” Wu wrote, and building a new, more inclusive culture. Then there’s the image to repair. It’s a big job. Huge. And that’s only if the company acknowledges that it has a problem to begin with.

It’s a dangerous position to be in; Uber’s main competitor Lyft seems to have none of its issues. I just tweeted out a link to a beautiful Lyft commercial with a strong, positive message that clearly states how valuable diverse talent is to the organization. I saw it as an ad on YouTube. Watch it. It’s one of the most compelling pieces of advertising I’ve seen in a long time, and I was late to the game. The commercial has been out for months.

Uber’s been on fire for a lot longer than that, and if it’s not careful the weight of its diversity debt is going to sink it without a trace.