"A fundamental failure of leadership"

15/06/2017 - 14:54


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"A fundamental failure of leadership"
"A fundamental failure of leadership"

In the past week both the co-founder and CEO of Uber, Mr Travis Kalanick and the CEO of WA’s Child and Adolescent Health Service have vacated their roles following damning independent workplace investigations into the cultures of their respective organisations. 

How can an international technology company that has completely disrupted the world wide passenger transport industry and the provider of a brand new children’s hospital in Perth get to the point where an immediate change in the top level of leadership becomes impossible to ignore any longer?


The demise of Uber CEO, Mr Kalanick started in February 2017 when a former engineer at Uber published a blog detailing allegations of harassment, discrimination and retaliation during her employment and the subsequent ineffective response by the company to these allegations (whilst she was employed).

In March 2017, the Board of Uber appointed a Special Committee to oversea a review of the workplace environment specifically looking at allegations around discrimination and harassment as well as the sufficiency of Uber’s HR policies and procedures.

The investigation team conducted over 200 interviews with current and former employees and these assisted in the formulation of the report that was delivered to the Board this week – and consequently the immediate change and reallocation of duties from the incumbent CEO.

Essentially the investigation made 10 recommendations[1]:

  1. A need for changes to the Senior Leadership Group;
  2. Enhanced Board Oversight;
  3. Development of greater internal controls;
  4. The reformulation of Uber’s Cultural Values;
  5. Greater training of staff;
  6. Improvements to Human resource and Complaint processes;
  7. Diversity and inclusion enhancements;
  8. Changes in employee policies and practices;
  9. Address employee retention; and
  10. Review and assess Uber’s pay practices.

Quite a staggering list of (mainly HR) improvements for an organisation as prominent as Uber!

Princess Margaret Hospital and the new Perth Children’s Hospital

The findings of the Department of Health review into the WA Child and Adolescent Health Service were released by the WA State Government this week. The report found there had been “a fundamental failure of leadership within the hospital with non-engagement of staff resulting in low morale and disillusionment”. Of the 200 staff interviewed as part of the review, more than 90 per cent said it was a "very unhappy place to work"

Amongst many other things the investigation found[2]:

  • Staff surveys indicated that the management style was non-supportive and at times frankly dismissive of them;
  • Staff identified a fear of retribution should they voice opinions at odds with management and there was a perception that those that spoke up may be sidelined from career progression;
  • Ineffective engagement and communication between senior management and staff;
  • Perceptions of increased layers of bureaucracy with staff unsure of governance structures;
  • A high degree of Change management fatigue.

Common problems in organisations where a CEO or Executive has to be removed

In our opinion, there are some key indicators of an organisation that may be suffering from a failure of leadership. These are: 

  • A Board that focuses on technical / financial skills to the exclusion of board members with people management skills;
  • A CEO or Executive member that displays behaviour that is inconsistent with the organisations values (e.g. the ‘top down’ effect); 
  • An Executive that turns a blind eye to “high performers” and allows them to behave to a different standard of behaviour than other staff members;
  • An Executive or CEO that provides incentives that drive the wrong behaviour of leaders in the organisation;
  • Failing to have robust HR policies and procedures around bullying and harassment; discipline; codes of conduct; whistle blowing processes etc;
  • Failing to train people in the organisation’s culture and values policies;
  • Failing to hold people to account when they breach these cultural or behavioural rules;
  • Failing to be consistent in disciplinary decisions;
  • Inadequate or poorly performing HR team. 

 “People are our most important asset”

Until we live in a society that has workplaces dominated by robotic machines void of human foibles – corporations will need strong, principled and ethical leaders to guide their organisations around such cultural crisis and scandals. 

Experienced and capable HR practitioners have a role in supporting an organisation to promptly, legally and ethically deal with people and cultural issues when they arise on behalf of the organisation. 

There is also merit in:

  1. the establishment of an independent complaint mechanism for an organisation.  Genuine and serious concerns from staff should be able to bypasses the Executive and be tabled at Board meetings as appropriate. This at least gives a Board the opportunity to take pro-active action on leadership before they have to become reactive to social media posts;
  2. Regularly reviewing the HR policies and procedures of the organisation and establishing if they are fit for purpose and known throughout the business;
  3. Conducting periodic HR compliance audits or risk assessments to establish areas of potential exposure; and
  4. Conducting regular training and professional development on behavioural expectations; and
  5. Having ready access to experienced and independent workplace investigators should the need arise. 

[1] https://newsroom.uber.com/covington-recommendations/

[2] Health WA


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