Table a matter of Organisaitonal Behaviour: TALK ABOUT DEMOCRACY..

 

 

 

Table of Contents
Introduction: 3
Management
Models: 4
2.How
it was able to go bad so fast, a matter of Organisaitonal Behaviour: TALK
ABOUT DEMOCRACY.. 5
2.1
Corporate Social Responsibility and Ethics: 6
2.2
Unwanted effects of bad Organisational Behaviour: 7
2.2.3
Managing Diversity and Understanding Varying Culture (Exhibit A – Singapore) 7
The
Cost of having ‘bad’ Oragnisational Behaviour’ 8
Dara
Khosrowshahi: 9
 

 
 

Introduction:

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             The
term Uber comes from the German definition for “denoting an outstanding or
supreme example of a particular kind of person or thing” as described by the
Oxford dictionary, this in a way represents the technology company’s persona in
displayed via its conduct internationally in previous years. An organisation
known for its extremely aggressive
expansions by revolutionising an outdated point-to-point transport system which
has not only faced backlash but legal obstacles and questionable operational
conduct as well. The paper explores the reason behind how Uber’s success from a
managerial and leadership perspective but also how this has unfortunately lead
to the organisations current state of deterioration. Exploring the concept of
how former CEO Travis Kalanick’s own personality has influenced the company
internationally through the theory of ‘trickle-down’ leadership and explaining
how this explain the ethical behaviours and consequences of its notable
progression. Incorporating various models of management and leadership we
examine the pros and cons that Kalanick’s former  company has done over the past few years
likewise looking at current CEO Dara Khosrashowhi’s desire of the company and
his plans for improvement.

 

Management Models:

 

2.How it was able to go bad so fast, a matter of
Organisaitonal Behaviour: TALK ABOUT DEMOCRACY

             The
old saying that ‘leaders are born’ has been heavily debunked by sociologist
throughout recent decades since a person’s personality and attitudes is partly
shaped by heritance but also heavily moulded by experience influenced by those
around us. The probability that your friend will be happier goes up by 25% when
you are happy with similar findings for losing and gaining weight as well as
quitting smoking (Folwer & Christakis, YEAR).
Chances of splitting with a spouse  goes
up by 75% if a close friend attains a divorce and 33% if a friend of a friend
attains a divorce (McDermott). This concept of where one’s atmosphere is
influenced by behavioural osmosis is known as ‘social cognition’ which provides
a ‘mechanistic, process-oriented explanation of complex social
phenomena'(Winkielman & Schooler YEAR)
which has allowed Kalanick’s personality as catalysed by the companies
exponential growth to ‘trickle-down’ the chain so fast. This shows how
important it is from an organisation to have both good leadership and
management.

 

One way in which the investors and
shareholders have done their part in running the company which Khosrowshahi
described as a culture and governance that went wrong and the board went in a
very bad direction. His solution to the matter is to increase the number of
people holding shares of the company taking a more parliamentary approach to
management. When focusing too much on improving firm status from a traditional
business perspective of maximisation of utility, neglect for certain concerns
is seen.

 

The board’s and Kalanick’s desire
to simply expand the company with an ‘at all cost mentality’ is the result of
the company’s prestige influencing stakeholder evaluations (Kim & King, 2014)
and investors reacting less negatively in response to greater earnings and high
status (Sharkley, 2014). This is about what is known as the ‘halo effect’ also
known as the ‘Mathew effect’ (Merton, 1968) which takes reference to a verse in
the bible which explains the influence of one’s position on a bell curve, the
rich or those above the mean will get richer and progress further to the from
and vice versa. This is show in reflection if a firm’s status being its
“relative social standing” (Sorenson, 2014: 63) which denotes a position in a
hierarchy (Podolny, 2001; Graffin et al. 2013) and reputation being the public
person of a firm’s unique and distinguishable attributes (Fombrum &
Shanley, 1990; King & Whetton, 2008) including performance (Sorenson, 2014)
or comparative discrepancies (Deephouse & Carter, 2005). The implication of
firm status and reputation influences its perception by stakeholders whether
being internal stakeholder and managers or external representing service users
and judiciaries.

2.1 Corporate Social Responsibility and Ethics:

             Whilst
organisations may have begun to sacrifice their profits for social interests
(Elhauge, 2005) post World War 2 where firms were not only in favour of helping
servicemen and women integrate back into society, but also to aid a world
recovering from great tragedies. It has been ‘capitalised’ as a sub-passive
indirect form of investing into public relations with a return in higher sales
seen in status and reputation favouring the company. Playing with underlying
psychological mechanisms of behavioural expectations (Kim and King, 2014), the
research has shown that is important for an entity to strive in both reputation
and status and is unfavourable when a company has a positive reputation in one
aspect such as Uber’s quality of service
and transparency but also of having bad reputation in another domain (Rhee
and Haunschild, 2013) such as their conduct and lack of respect for competitors
or treatment of employees. This has played in the hands of competitors such as
Lyft which currently holds approximately a quarter of the market share compared
to Uber’s dominating 90%+ market share at the end of the 2013 financial year.
Its conduct is what is driving customers to not only other alternative services
but also negatively effect the organisation in the outcome of legal battles.

 

Understanding this and given Uber’s
current reputation for treatment of its internal and external environment
combined with a neglect for CSR and ethics as shown by their neglect in the past
to participate in such activities, doing so would tremendously help the
organisation.

 

 

2.2 Unwanted effects of bad Organisational
Behaviour:

Whilst legal systems in most
developed nations are designed to be of justice and equity, human behaviour is
still biased. The concept of the ‘halo effect; as proposed above in
circumstances where a jury finds a firm subjectable and blameworthy for
misconduct this flips over and becomes a ‘halo tax’ where as the result of
where an evaluator’s trust in an firm’s reputation and status is seen as
‘betrayal’ and the effects are more negative than what would be if not for the
distrust. It is typical for more prestige and elite corporations to bath in
their influence within a legal domain (Heinz and Laummann, 1982; Shaffer, 2009)
with their positions distorting the enforcement of laws when applied to
corporate misconduct (Sutherland, 1949). This is seen in the case of Uber’s
suits within London where the company’s lack of participation in CSR practices
has played a huge part of their ban on the basis of it being not ‘fit and
proper’ in accordance to the values held in that geographic.

2.2.3 Managing Diversity and Understanding Varying
Culture (Exhibit A – Singapore)

Central Intelligence Agency Statistics (2017)

 

Population (N)

Land Mass (Km^2)

N / Km^2

Singapore

5,888,926

709

8305.96

New zealand

4,510,327

268,838

16.78

Finland

5,518,371

303,815

18.16

Denmark

5,605,948

42,434

132.11

Australia

23,232,413

7,682,300

3.02

United Kingdom

65,769,452

241,930

271.85

United States

326,625,791

9,147,593

35.71

 

             Understanding
the internal and external environment of an organisation is an essential
component of operational integrity ensuring that operational integrity is held
to a high standard which is especially necessary for an international
organisation such as Uber. When comparing the statistics of Singapore relative
to that of countries with similar population and those that the potential
audience of this paper would be familiar with, see that the population (N) per square
kilometre is completely different and about 30 times the size of the second
higher (N / Km^2). This poses many underlying challenges that could be faced,
for starters understanding that with such density of population the standing
and previous governments would have measures in place to ease both levels of
congestion and pollution which is currently done in the form of high taxations
and tariffs for vehicular importers as highly expensive costs for registrations
to lower the supply of vehicles in the country.

 

To deny this would be foolish as
Uber’s decisions to rent thousands of vehicles in Singapore not only
demonstrates that they were aware of the vehicular situation of this current
market which would allow them to ‘penetrate’ the Asian sector but also shows
how their basic model of simply connecting drivers and riders is a liability.
One main criticism made by the taxi industry is that Uber drivers typically are
not subjected to the same level of background checking and driving experience
tests and has resulted in Uber drivers being responsible for a multitude of
fatalities in Singapore.

 

 

The Cost of having ‘bad’ Organisational Behaviour’

Studies have
found that firm’s benefit tremendously from having good status and reputation
especially when the two are aligned (Stern, Dukerich and Zajac, 2014), in
reference to Uber’s conduct, continuous cases of sexual harassment and
discrimination suits, disrespect for their competitors in the market and lack
of participation in CSR has led to a variety of consequences including
increased markets-share of their main competitor ‘Lyft’ and being stripped of
their license to operate out of London.

3.0 Recommendations:

             One
of the main problems of Uber is despite their high-quality service, their
status is declining, and reputation is slowly being regained. The managerial
side of Uber is not much to be changed but the leadership is and method of
governance.

 

 

Eventuality of regaining public
perception as a result of Khosrowshahi mission to improve Ubers culture and the
execution of proposals made in the paper, a positive reputation as seen by the
public will be regained given that Uber has recently expanded its brand to allow
for Uber-Eats and Uber-Pool, public perception in the masses is still good and there
is not much precedence for Uber to concern about as typically expected from companies
as people in general are largely circumspect towards revised pre-existing beliefs
(Traut-Mattaush et al., 2014)

 

Situational awareness is critical for
any firm’s adaptation in a new market, it should adhere to the cultures and norms
of that particular region, simply operating in a conventional sense with a level
of neglect opens to a sense of vulnerability and mis-conduct. This has been a great
challenge for the firm given their level of expansion internationally with the number
of administrative officers required to maintain and ensure smooth operations has
obviously been very costly for the company, but more needs to be done to understand
the different niches of markets. This is more so important on a regional sense rather
than that of a country-by-country basis,

Dara Khosrowshahi:

https://www.cnbc.com/2018/01/23/live-uber-ceo-dara-khosrowshahi-talks-tech-at-davos.html

 

 

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