Can Dara Khosrowshahi Help Uber Move In The Right Direction?

by CXOtoday News Desk    Aug 29, 2017

dara

Uber has finally selected Dara Khosrowshahi as its new CEO, who was earlier leading the online travel company Expedia, according to media reports. The selection was made after a contentious search process as the ride-hailing company seeks to move past a turbulent period.

Choosing Khosrowshahi is crucial to returning stability to Uber, the world’s biggest ride-hailing company, which has been without a leader since its co-founder, Travis Kalanick, stepped down from the CEO job under pressure on June 20. Under Kalanick, Uber transformed the transportation scenario by offering people the ability to summon a ride through an app, and the privately held company swelled to nearly $70 billion.

But Uber’s future became murkier in recent months when the company was held for several scandals, including sexual harassment accusations in the workplace, ill-mannered drivers, and an intellectual property dispute with a self-driving car rival. While Uber’s recorded growth last quarter, Kalanick’s management style faced scrutiny and investors mutinied against him. At the same time, the company still bears the imprint of Kalanick, who remains on Uber’s board.

Running Uber will be no easy task. While the business is growing, the company has been trying to reform its workplace culture following accusations of sexual harassment. 

As Bloomberg reported, Uber needs to decide whether it’s a grown-up company that will start building a sustainable, profitable business suitable for a public company, or if it’s still in a teenage phase of spending like mad to push into every country and new area of business it can.

“The trouble is, the tempest over picking a new CEO and the ugly ongoing feud between a group of investors and ousted CEO Travis Kalanick each reflect a rift over this fundamental question about Uber’s strategy, as well as a seemingly irreparable division of the company’s most important personalities. Even a perfect CEO will find it tough to succeed in such conditions,” Bloomberg reported.

Nonetheless, it is healthy for the CEO spot to be filled because many tough decisions have been on hold. For example, the board discussed whether to team up with a car company for Uber’s driverless car operation, tech news outlet The Information recently reported.

As Brad Gerstner, founder and CEO of investment firm Altimeter Capital, which owns shares of both Expedia and Uber, aptly puts it, “He’s got an extraordinarily deep network,” and Priceline veteran Robert Mylod noted that he is “a great strategic thinker and a no-nonsense leader.”

Khosrowshahi, who has been president and chief executive of Expedia since 2005. Based in Bellevue, Washington, Expedia has travel brands including Hotels.com and Orbitz. Under Khosrowshahi’s leadership, Expedia more than doubled its annual revenue since 2012 to nearly $8.8 billion in 2016. The company reported net income of $281.8 million for 2016.Khosrowshahi also joined the board of The New York Times Company in 2015, and previously worked at IAC/InterActive Corp.

At Expedia, Khosrowshahi has been an outspoken chief executive. His family emigrated to the United States from Iran because in the late 1970s. He has been an outspoken critic of Donald Trump: Khosrowshahi blasted Trump’s travel ban, which includes Iran, as “inward-looking” and “reactionary.” Expedia filed a legal challenge to the ban. On August 16, 2017, Khosrowshahi tweeted, “I keep waiting for the moment when our Prez will rise to the expectations of his office and he fails repeatedly.”

It needs to be seen if Khosrowshahi can successfully take on the daunting task of mending Uber’s image, rebuilding employee morale and create and sustain a profitable business.