When CEOs be a part of their staff within the trenches it may translate to appreciable positive aspects in productiveness for his or her firms. However Uber CEO Dara Khosrowshahi took the concept to a complete new degree when he actually took the wheel and have become one in every of his firm’s drivers for a number of months. It started as an effort to know the experiences of drivers throughout the pandemic, however the experiment finally pressured Khosrowshahi to “reexamine each single assumption that we’ve made.”
“I feel that the trade as a complete, to some extent, has taken drivers as a right,” Khosrowshahi mentioned in an interview with the Wall Road Journal printed Friday. Since Uber was based in 2009, its aim was to supply passengers a seamless using expertise, in line with Khosrowshahi, who succeeded Uber cofounder Travis Kalanick as CEO in 2017, even when typically that aim got here on the expense of drivers.
“Traditionally, we’ve at all times put a premium on the rider expertise,” he mentioned.
In 2021, Khosrowshahi posted on Twitter his experiences using round San Francisco on a bicycle making Uber Eats meals deliveries, telling the New York Occasions that he was initially “nervous” and “almost bought killed” in site visitors close to the town’s baseball stadium whereas the Giants have been enjoying.
Khosrowshahi went into extra element about his expertise in his interview with the WSJ, the place he described utilizing a secondhand Tesla final 12 months to masquerade as an Uber driver chauffeuring folks across the metropolis, with a curated Spotify playlist and all. The experiment was identified internally as “Challenge Boomerang,” and was initially designed to find out how the corporate may entice extra drivers after a pandemic-induced scarcity. By way of the hassle Khosrowshahi skilled many frequent Uber driver complaints, together with harassment from riders, anxiousness over sustaining a excessive score, and a irritating sign-up course of.
“The entire expertise was fairly clunky,” he mentioned.
After ridership plunged throughout the pandemic, enterprise for Uber and Lyft is beginning to rebound. In February, Khosrowshahi attributed his firm’s stellar earnings final quarter to shopper demand returning to pre-pandemic ranges. Distant work beginning to wind down has additionally helped increase Uber’s inventory this 12 months.
However challenges nonetheless lie forward for Uber, particularly in relation to attracting drivers. When vitality and gasoline costs soared final 12 months, take-home pay for drivers shrunk drastically, forcing some to work for lower than minimal wage. Uber has been on unhealthy phrases with drivers over elevated pay to assist offset inflation, particularly since final 12 months when the corporate efficiently sued to dam vacation raises in New York Metropolis. A New York choose did order Uber to offer raises to drivers final month, however tensions proceed to run excessive, as drivers elsewhere within the nation proceed to criticize the share of journey charges Uber retains and accuse it of discriminatory account suspensions or deactivations.
Disagreements additionally persist concerning the employment standing of Uber drivers. Final month, a California appeals court docket upheld a 2020 classification of Uber drivers as impartial contractors slightly than staff, which suggests the corporate doesn’t want to offer drivers with unemployment insurance coverage and medical insurance, or cowl enterprise bills.
The corporate should additionally take care of competitors from Lyft, which final month put in a brand new CEO. Uber nonetheless dominates 71% of the U.S. rideshare market to Lyft’s 29%, however Lyft’s new CEO, David Risher, says he welcomes the competitors. “I feel the world desires and type of wants a robust quantity two,” Risher mentioned in a latest interview with Fortune.
Khosrowshahi implied in his interview with the WSJ that retaining drivers and making Uber work for them is vital to sustaining its present rebound. He mentioned that being a non-founder CEO permits him extra room to make progressive and probably disruptive modifications, which could embrace extra efforts to win the “hearts and minds” of drivers.