Lúmina 26(1)

DOI: https://doi.org/10.30554/lumina.v26.n1.5259.2025

Rebuilding organizational

culture through transformational

leadership: success lessons from

Uber’s experience in startups

Reconstrucción de la cultura organizacional a

través del liderazgo transformacional: lecciones

de éxito de la experiencia de Uber en startups

Reconstruindo a cultura organizacional por

meio da liderança transformacional: lições de

sucesso da experiência da Uber em startups

Houda Feriel-Boughaba

Baci Ilhem

Abstract

This study explores how transformational leadership can drive the success of

startups by reshaping their organizational culture at a fundamental level. Using a

case study approach, the research examines Uber’s experience to demonstrate

the impact of this leadership style. Despite facing numerous crises and scandals

that threatened its organizational culture, Uber successfully overcame these

challenges by adopting transformational leadership practices. The study reveals

Recibido: 25 de octubre de 2024. Publicado: 4 de marzo del 2025.

Para citar este artículo:

Feriel-Boughaba H. y Ilhem B. (2025). Rebuilding Organizational Culture Through Transformational

Leadership: Success Lessons from Uber’s Experience in Startups. Lúmina 26(1).

DOI: https://doi.org/10.30554/lumina.v26.n1.5259.2025

hacer disponible la investigación al público. Esta obra está bajo una licencia Creative Commons Reconoci-

miento-NoComercial-Compartir Igual 4.0 Internacional (CC BY-NC-SA 4.0)

Orcid: https://orcid.org/0009-0004-8672-9069 Correo: ferielhouda23@gmail.com

h.boughaba@univ-soukahras.dz Afiliaciones: Universidad Mohamed Cherif Messaadia.

Orcid: https://orcid.org/0009-0008-8271-239X Correo: Ilhem.baci@univ-annaba.dz

Afiliaciones: Universidad Badji Mokhtar – Annaba-ALGERIA

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Feriel-Boughaba H. - Ilhem B.

that embracing a transformative and innovative leadership approach is essential

for enacting substantial cultural change within organizations. However, it also

emphasizes that such transformation requires a significant investment of time

and effort to achieve measurable and lasting results. This investigation highlights

the pivotal role of leadership in cultivating an adaptive and resilient organiza-

tional culture, which is critical for the success and sustainability of startups.

Keywords

: Startups, Organizational Culture, Transformational Leadership

Resumen

Este estudio explora cómo el liderazgo transformacional puede impulsar el

éxito de las startups al reformar su cultura organizacional de manera funda-

mental. Utilizando un enfoque de estudio de caso, la investigación examina la

experiencia de Uber para demostrar el impacto de este estilo de liderazgo. A

pesar de enfrentar numerosas crisis y escándalos que amenazaban su cultu-

ra organizacional, Uber superó con éxito estos desafíos al adoptar prácticas

de liderazgo transformacional. El estudio revela que adoptar un enfoque de

liderazgo transformador e innovador es esencial para implementar cambios

culturales significativos dentro de las organizaciones. Sin embargo, también

enfatiza que dicha transformación requiere una inversión considerable de

tiempo y esfuerzo para lograr resultados medibles y duraderos. Esta inves-

tigación destaca el papel fundamental del liderazgo en la creación de una

cultura organizacional adaptable y resiliente, que es crucial para el éxito y la

sostenibilidad de las startups.

Palabras clave

: Startups, Cultura Organizacional, Liderazgo Transforma-

cional.

Resumo

Este estudo explora como a liderança transformacional pode impulsionar o

sucesso de startups ao reformular sua cultura organizacional de maneira fun-

damental. Utilizando uma abordagem de estudo de caso, a pesquisa examina

a experiência da Uber para demonstrar o impacto desse estilo de liderança.

Apesar de enfrentar inúmeras crises e escândalos que ameaçaram sua cultura

organizacional, a Uber superou esses desafios adotando práticas de liderança

transformacional. O estudo revela que adotar uma abordagem de liderança

transformadora e inovadora é essencial para promover mudanças culturais

substanciais dentro das organizações. No entanto, também enfatiza que essa

transformação exige um investimento significativo de tempo e esforço para

alcançar resultados mensuráveis e duradouros. Esta investigação destaca o pa-

pel crucial da liderança na construção de uma cultura organizacional adaptativa

e resiliente, que é fundamental para o sucesso e sustentabilidade das startups.

Palavras-chave

: Startups, Cultura Organizacional, Liderança Transforma-

cional.

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Rebuilding organizational culture through transformational

leadership: success lessons from Uber’s experience in startups

JEL Classification: M13; M140; M540.

1. Introduction

Startups represent the forefront of the new economy, yet they op-

erate in environments rife with risks and constant changes. While

navigating these uncertainties, startups remain at the leading edge

of economic innovation (Szarek & Piecuch, 2018). These challeng-

ing circumstances pose significant obstacles, making it essential

for startups to build and maintain a strong reputation to survive in a

competitive landscape (Karrarslan & Soylu, 2023). This necessity is

often reflected in their corporate culture, which serves as a powerful

tool for shaping the company’s identity and attracting both talent and

customers (Schein, 2010).

Effective leadership plays a pivotal role in shaping and guiding or-

ganizational culture, ensuring its successful communication to a wide

range of stakeholders. Transformational leadership, in particular, is

widely recognized as an especially effective leadership philosophy for

driving cultural change within organizations (Goleman, 2010). A relevant

case study is Uber, one of the leading startup companies in the United

States and globally.

Uber faced substantial challenges due to its aggressive leadership

style and toxic organizational culture, leading to numerous scandals

and a subsequent decline in growth. This downturn critically affected

the company’s performance, bringing it to the verge of collapse (Conger,

2019). These challenges were evident in a series of notable incidents

that underscored the company’s internal dysfunction and controversial

public image. For instance, Susan Fowler a young engineer who joined

Uber in November 2015, exposed a toxic culture within the company,

particularly towards women. On her first day of work, she was subjected

to sexual harassment by her manager.

After filing a complaint with the (HR) department, she was surprised

to learn that the manager would not be dismissed because he was a

“high-performing employee” and she was given the option to transfer

to another team. Over time, Fowler discovered that her experience

was not isolated, as she encountered other women with similar stories.

She also revealed a performance evaluation system that excessively

prioritized growth, fostering a highly competitive and toxic environment.

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One notable incident occurred when women were denied leather jackets

promised as a company gift, with the justification that their exclusion

was a form of equality. In February 2017, Fowler decided to leave Uber

and published a blog post titled “Reflecting on One Very Very Strange

Year at Uber” detailing her experiences. This revelation brought to light

the internal issues within the company, ultimately leading to significant

changes in its management.

However, the challenges were not limited to internal issues but

also extended to incidents that sparked widespread public criticism.

For example, Following President Trump’s announcement of the

travel ban targeting citizens of predominantly Muslim countries,

Uber suspended surge pricing for rides to JFK Airport during the

protests. However, this decision was interpreted as an attempt to

undermine the strike initiated by taxi drivers, leading to the launch of

the #deleteUber campaign. This backlash highlighted the perceived

insensitivity of Uber’s actions, as it appeared to prioritize business

interests over solidarity with the protesters and the broader social

justice movement (ISAAC, 2019). In response, Uber was forced to

reevaluate its organizational culture and adopt a new leadership

strategy to regain its market position.

The adoption of a transformational leadership approach was crucial

in Uber’s efforts to revitalize its organizational culture. This strategic

shift led to the replacement of former CEO Travis Kalanick with Dara

Khosrowshahi, under whose leadership the company has since worked

to restore its image and stabilize its operations (Bastos, 2017).

Based on the foregoing, a key issue arises regarding the extent

to which transformational leadership can reshape the organiza-

tional culture of startups facing deep structural crises. In the case

of Uber, the previous leadership style entrenched a toxic organi-

zational culture that negatively impacted internal performance and

the company’s market reputation. With the adoption of transfor-

mational leadership, the company aimed to drive a fundamental

shift in its values and institutional practices. However, the question

remains as to how effective this leadership approach is in achiev-

ing sustainable cultural change within organizations that have

experienced profound cultural deviations. In other words, the core

issue of the study is crystallized in the following central question:

How did Uber leverage transformational leadership to reshape its

corporate culture and regain control of its leadership?

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Rebuilding organizational culture through transformational

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1.1 Study Importance

The importance of this study stems from its exploration of a critical topic

that has garnered significant attention from human resources scholars.

Additionally, the research examines a previously underexplored relation-

ship between transformational leadership and organizational culture in

emerging enterprises.

1.2 Study Significance

The significance of this study lies in its investigation of a key issue

that has attracted the interest of human resources researchers. By

connecting transformational leadership with organizational culture in

startups, the research offers fresh insights that could enrich both aca-

demic understanding and practical applications in this field.

1.3 Study Objective

The study aims to explore how transformational leadership can reshape

organizational culture to improve business success, drawing on Uber’s

experience in reclaiming its market position.

2. Literature Review

Modern management’s primary goal is to achieve change and transfor-

mation within organizations, with transformational leadership and orga-

nizational culture playing essential roles in this process. These elements

work in tandem to shape the internal environment by fostering shared

values, attitudes, and practices. Transformational leadership, as outlined

by (Bass, 1985), is a key driver in inspiring followers and encouraging

them to exceed expectations, thereby creating a motivating culture that

supports organizational success. In line with this, McGregor and Burns

emphasize that transformational leaders contribute significantly to or-

ganizational change by engaging in practices that promote innovation,

commitment, and long-term achievement (Reid & Dold, 2018).

Additionally, Schein (2010) highlights the importance of leadership in

shaping organizational culture through mechanisms such as resource

allocation, reward systems, and the management of critical incidents,

which collectively reinforce the values and assumptions that underpin

the organization’s identity. This literature review will address the inter-

relationship between transformational leadership and organizational

culture, and explore how these factors contribute to the creation of

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environments that foster sustained organizational success in an ev-

er-changing business landscape.

2.1 Transformational Leadership

According to Bass, transformational leadership is defined by a pro-

cess in which leaders inspire their team members to transcend their

personal interests and align with the broader goals and mission of the

organization (Bernard , 1985, p. 25). This leadership style not only aims

to expand and elevate employees’ interests but also involves a moral

and psychological process that establishes an ethical and transparent

framework for organizational growth, free from coercive tactics (Moradi

& ShahbazI, p. 455). Transformational leadership integrates individual

aspirations into collective objectives, fostering a unified organizational

vision. Leaders using this approach prioritize aligning organizational

values, goals, and performance with a deep understanding of individual

motivations. By raising employees’ awareness of higher-order needs and

aligning their personal identities with the organization’s mission, trans-

formational leadership boosts both employee morale and performance

(Davis & Thilagaraj, 2022, p. 154).

Moreover, transformational leaders actively assess the strengths and

weaknesses of their team members, setting goals that align with both

individual aspirations and organizational performance objectives. They

also inspire and empower employees to take on greater responsibilities,

leading to higher engagement and productivity in the workplace (James

& Ogbonna, 2013, p. 356).

2.1.1 Transformational Leadership’s Components

The Four Key Elements of Transformational Leadership: Bass, a pio-

neer in the field, first identified the four components of transformational

leadership: idealized influence, inspirational motivation, intellectual

stimulation, and individualized consideration (Farnsworth, et al., 2002,

p. 02). This discussion will examine each element to help managers

effectively implement this leadership strategy in the workplace.

Idealized Influence

: A leader should serve as a respected and

trustworthy guide for staff members, someone they can rely on to

make the best decisions for the organization.

Inspirational Motivation

: Leaders who inspire team members to

embrace the company’s vision foster a sense of unity in pursuing

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key objectives, such as increasing market share and revenue

growth.

Intellectual Stimulation

: Leaders encourage innovation and

creativity by promoting critical thinking and challenging traditional

beliefs and perspectives to improve the organization.

Individualized Consideration

: Leaders pay close attention to the

individual needs of each team member, acting as a coach or men-

tor, listening to their concerns, showing compassion and support,

and maintaining open lines of communication.

2.2 Organizational Culture

Organizational culture comprises the set of shared core values that a

group develops through the challenges of maintaining internal cohesion

and external adaptability. These values become accepted truths, guiding

new members on how to perceive, think about, and manage various

issues. Organizational culture also refers to the shared behaviors, at-

titudes, beliefs, and symbols among the members of the organization,

both as a whole and within individual units or other social categories

within the organization. It is considered the most significant strategic

factor for competitive advantage and a valuable source of insights that

enhance performance. These common assumptions and values are

learned through experience and interaction (Sayyadi, 2021, p. 8).

Organizational cultures can be adaptable, bureaucratic, achieve-

ment-oriented, or clan-oriented. For example, they can foster creativity,

supportiveness, or bureaucratic processes. The most well-known typolo-

gy of organizational culture was developed by (Cameron & Quinn, 1999)

who proposed that four primary types of organizational culture—clan,

adhocracy, market-oriented, and hierarchical—can be used to assess

how culture influences an organization’s performance (Afiquah, 2022,

p. 48).

2.3 The Connection Between Organizational

Culture and Transformational Leadership

Organizational culture and leadership are critical components in devel-

oping and enhancing organizational effectiveness. There is an ongoing

debate about the relationship between transformational leadership and

organizational culture—whether culture arises as a result of leadership

or if leadership shapes culture. Transformational leaders have the ability

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to motivate their followers and anticipate future challenges, proactively

preparing for them. When leadership and organizational culture are

aligned, followers’ expectations and confidence increase, leading to a

deeper understanding of the culture and smoother assimilation into the

organization. Leadership plays a crucial and influential role in shaping

and enhancing the organization’s culture (Abourida , 2019, pp. 12-13).

Transformational leadership impacts organizational culture in several

ways (Sayyadi, 2021, p. 3):

Enhancing Trust and Commitment

: Transformational leaders

build trust and commitment among subordinates.

Mobilizing Support for Change

: They rally support for the lead-

ership’s vision for change.

Fostering a Learning Culture

: Transformational leadership pro-

motes a culture of learning by encouraging followers to explore

new ideas and knowledge.

Creating a Trustful Learning Environment

: Leaders with strong

transformational leadership skills foster trust and create an envi-

ronment conducive to learning within the organization.

Influencing Key Cultural Dimensions

: Collaboration, trust, and

learning are crucial aspects of organizational culture that are

shaped by transformational leadership.

3. Methodology

The qualitative approach based on a case study is well-suited for this

research as it provides an in-depth understanding of the complex inter-

actions between leadership and organizational culture in the context of

startups. This study adopts a case study methodology to analyze Uber’s

leadership transformation and its impact on organizational culture. Uber

was selected as the analytical model due to its prominent leadership

challenges and its leading role in the technology and ride-sharing sec-

tor, making it an ideal case for understanding the relationship between

transformational leadership and cultural change in startups.

This methodology allows for a thorough examination of the internal

and external dynamics that influenced Uber’s transformation, offering

valuable insights applicable to other organizations seeking to restructure

their corporate culture. A comparative approach was also employed to

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examine differences between crisis and reform periods, assessing the ef-

fectiveness of transformational leadership in driving sustainable change.

3.1. Data Collection Methods

Data were collected from multiple sources to ensure a comprehensive

and accurate analysis:

Primary Sources:

These included an extensive review of Uber’s

internal HR reports, providing deep insights into internal leadership

strategies and the evolution of organizational culture during periods

of crisis and transformation.

Secondary Sources

: These comprised an analysis of financial

reports from both Uber and Lyft, allowing for a comparative assess-

ment of financial and organizational performance during phases

of crisis and recovery. Additionally, credible news sources were

reviewed to document public controversies and perceptions of

Uber during the leadership transition from Travis Kalanick to Dara

Khosrowshahi.

4. Explaining how transformational leadership

helped Uber change its organizational culture

Uber is one of the most well-known startups, but its organizational

culture and leadership nearly drove it to bankruptcy, making it an ideal

case for analysis.

4.1 Overview of the Company

Uber is a technology-driven platform that uses a GPS-enabled mobile

application to connect drivers with passengers within a specific geo-

graphic proximity. The company was founded in March 2009 in San

Francisco, United States. Since its inception, Uber has experienced rapid

growth, expanding its operations to over 70 countries and more than

10,500 cities worldwide, including many locations in the Middle East.

The Uber app is compatible with various modern smartphone operating

systems, including Windows, iOS, and Android, and operates within the

legal frameworks established by national regulatory authorities (Uber,

2023). In this section, we will examine Uber’s state under the leadership

of Travis Kalanick:

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4.1.1 Cultural Characteristics of the Organization

Here are some of the key cultural traits of Uber in its earlier phase:

Mission

: To reimagine how the world moves for the better (Pereira,

2023).

Vision

: To provide everyone, everywhere, with access to reliable

and safe transportation (Robins School of business, 2020).

Values

: Uber declared fourteen core values. Below are some of

the most important ones, which have undergone improvement for

the better, highlighting the gap between the stated values and their

practical implementation:

Table 1 - Values: Espoused Vs Enacted

Espoused Values

Enacted Values

Let Builders Build

You can build as long as you toe the line

Meritocracy and toe-stepping

Leadership should not be challenged, and culture should go unquestioned

Optimistic Leaders

Hostile Leadership

Winning: Champion’s Mindset

Only external adversity is to be challenged, not internal

Make Big, Bold Bets

Make Big, Bold Bets, but not against the company

Source:

(Shreya et al., 2021)

It is evident that the values instilled by former CEO Travis Kalanick,

which prioritized commercial operations over public relations, contributed

to the development of a toxic workplace lacking in moral principles and

appropriate conduct.

4.1.2 Realistic Leadership

Travis Kalanick’s leadership lacked the inspirational qualities needed

to foster a healthy organizational culture, focusing instead on rapid

expansion at the expense of employee well-being. His leadership was

primarily driven by financial gain, often overlooking emerging internal

issues while prioritizing superficial aspects of operational performance.

Kalanick’s preference for individuals who mirrored his aggressive lead-

ership style contributed to a toxic organizational climate, exacerbated

by his narcissistic tendencies (Shreya et al., 2021, p. 6).

Aggression was a defining characteristic of Kalanick’s leadership

approach. He exerted extensive control over various facets of the

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Rebuilding organizational culture through transformational

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company, stifling employees´ ability to engage in problem-solving

discussions. Leaders with a propensity for rapid decision-making, like

Kalanick, often prioritize eliminating obstacles without considering the

collateral effects. His self-characterization as a military general, exem-

plified by his statement to a competing CEO that he would “see him in

the trenches”, reveals his perception of leadership as combative and

high-stakes. This perspective turned professional interactions within the

company into a state of conflict, framing competition as a struggle with

existential implications.

Kalanick’s personal conduct also became a point of controversy, with

incidents such as derogatory remarks in public and private legal issues

significantly damaging the company’s public image and reputation (Ann,

2016). Known for his harsh demeanor, Kalanick pushed his employees

beyond their limits to achieve objectives, often encouraging them to

adopt “dirty tactics” against Lyft, their primary rival, to win over clients.

However, it is important to acknowledge his entrepreneurial mentality,

which promoted self-initiative and compelled staff members to think

creatively in order to generate new ideas (FINANCHILL, 2023).

4.1.3 Toxic Culture at Uber Under Travis Kalanick

Uber´s culture under Travis Kalanick closely resembled a market-driven

culture, where rapid growth was pursued at the expense of customer

well-being and employee satisfaction. Several defining characteristics

of this toxic culture include:

Uber´s environment was often compared to a mix of Thomas Hobbes’,

philosophy,

Animal House

, and

The Wolf of Wall Street

. This toxic cul-

ture spread under a youthful leader supported by an army of assistants,

empowered by virtually unlimited financial resources and no legal or

ethical checks and balances. The company was constantly engaged in

battles for control and dominance, both internally and externally, through

espionage, intellectual property theft, and lawsuits (Isaac, 2019, p. 14).

During Kalanick’s tenure, a “bro culture” was also prevalent. Uber be-

came known for its “work hard, play hard” mentality, with long work hours

expected but accompanied by a significant degree of business manage-

ment freedom. While this model might seem appropriate for a fast-grow-

ing multinational organization, Kalanick oversaw a rather homogenous

workforce primarily composed of young white men, as many hiring deci-

sions were made based on personal preferences. Employee evaluations

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were often described as “arbitrarily problematic”, with little justification

provided for performance reviews. Employees could receive low grades

for “lacking hustle”, which was one of the organization´s core values.

The most alarming aspect was the pervasive atmosphere of aggressive

behavior, sexual harassment, and abuse in a racially hostile environment

that was further exacerbated by alcohol and drug abuse in Uber offices

around the world (Robins School of business, 2020).

4.1.4 Consequences of a Toxic Culture

and Ineffective Leadership

An investigation into Uber’s communication issues reveals that the

absence of a supportive organizational culture was the core problem.

Several incidents in recent years have shown that Uber promoted behav-

ior viewed by many as predatory and overly aggressive (Lynch , 2017).

As a result, the company now faces several significant issues, including:

a. Lawsuits

Uber has been subjected to multiple legal challenges, including a

federal investigation into potential criminal activities related to employee

sexual harassment and the circumvention of municipal transportation

regulations (Lassiter, 2017). In addition, Alphabet Inc., Google’s parent

company, sued Uber over allegations of intellectual property and trade

secret theft concerning self-driving car technology (Hook, 2017).

Moreover, Uber previously employed a system called “Greyball” that

allowed its drivers to evade “unruly passengers” and government inves-

tigators in regions where the company operated illegally. This practice

raised concerns about Uber’s disregard for passenger privacy, and it was

also used to circumvent local government regulations. These actions

led the Department of Justice to launch a criminal investigation into the

company’s misconduct (Cook et al., 2018).

b. Regulatory and Safety Challenges

Uber encountered legal and regulatory difficulties in numerous cities

and countries worldwide due to its failure to comply with safety and

transportation standards. The company’s treatment of its drivers has also

been a point of contention, with critics claiming that Uber fails to provide

adequate protections and rights for its workers. These challenges stem

from leadership decisions, particularly those of Travis Kalanick, whose

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Rebuilding organizational culture through transformational

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actions created internal conflict and discord, ultimately undermining the

company’s stability and decision-making capacity (Ann, 2016).

c. Market Share Loss

Kalanick’s leadership and the company’s toxic culture contributed to

a significant drop in Uber’s market valuation, which declined by tens of

billions of dollars, allowing competitors like Lyft to gain market share.

The following figure illustrates this:

Figure 1- Market Share of Uber and Lyft (2016-2017)

Source:

(Hook, 2017)

The data clearly shows that Kalanick’s leadership style and the toxic

culture at Uber resulted in substantial market share losses during its

crisis. Lyft, Uber’s primary competitor, capitalized on this opportunity

and expanded its market presence. Uber no longer commands 60% of

the market, as it did in 2016 when it held twice the share of Lyft. This

shift was largely driven by the #DeleteUber campaign. Notably, the

analysis also includes Uber Eats in these results. Uber saw a 61% loss

in market share compared to late 2017 when the focus was solely on

the ride-hailing segment.

4.2. The Road of Uber Through Change

Under Dara Khosrowshahi’s leadership, Uber focused on transforming

its aggressive and competitive culture into one that values cooperation,

transparency, and respect. This shift required a complete overhaul of

corporate policies and values to rebuild the company’s reputation and

foster a more ethical and positive work environment.

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4.2.1 Planning: Uber’s Leadership Transformation Protocols

Following numerous controversies that severely damaged Uber’s

image and stunted its growth, the company hired an external audit

team to assess internal issues and recommend necessary changes.

The recommendations focused on four key areas: accountability, trust,

change, and tone at the top. Two of the most significant suggestions

included reviewing and redistributing Travis Kalanick’s responsibilities

and making changes to senior leadership.

a. Strengthening the Audit Committee

The board of directors took steps to expand the audit committee’s

size, role, and independence. By adding independent directors, Uber’s

audit committee improved. One of the audit committee’s key functions

is establishing a direct reporting line from the compliance department.

This structure ensures that compliance officers can report serious issues

related to harassment or regulatory compliance directly to the committee

without first going through management or the CEO.

b. Internal Controls as a Regulatory Force

Internal controls serve as early warning systems and safety measures.

While typically associated with financial and accounting responsibilities,

the most important controls related to culture and leadership include pol-

icies, monitoring procedures, and record-keeping. Developing a system

to track complaints within this framework, rather than relying on organi-

zational memory, will help identify repeat offenders (Belcher et al., 2018).

c. Reframing Cultural Values

Uber needed to realign its cultural principles to foster more positive

and inclusive behaviors. To achieve this, the company took several steps

(Holder , 2017, p. 4):

Clearly defining values in collaboration with a reputable organiza-

tion experienced in organizational change.

Embracing inclusive values that promote a collaborative environ-

ment, such as teamwork, mutual respect, diversity, and inclusion.

Reducing the total number of values and eliminating those that

justified negative behaviors, like “Let Builders Build” and “Always

Be Hustling.”

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Encouraging senior leaders to embody these values daily, promot-

ing a more collaborative and inclusive culture across Uber.

d. Focusing on Training to Manage

Behavioral and Cultural Shifts

Training was essential to help staff understand how to align their

decisions with the company’s new values. The training was targeted

at four key groups: interviewers, managers, HR, and senior leaders.

Senior leaders were given time and resources to be trained in (Belcher

et al., 2018, p. 9):

Modeling inclusive leadership and addressing implicit bias.

Creating a culture where employees feel heard and are free to

share ideas.

Developing essential management skills, including setting organi-

zational goals, leading teams effectively, implementing institutional

controls, and identifying and addressing problems with corporate

controls.

e. Modifications to Employee Policies and Practices

Uber revised its harassment and discrimination policies to make

clear that any behavior compromising the privacy or dignity of others

is unacceptable. Policies also required managers to notify HR imme-

diately of any known incidents of harassment or discrimination for fur-

ther investigation. These policies were designed to protect employees

from harassment by both coworkers and external parties. Additionally,

romantic or personal relationships between employees were prohib-

ited. The company also improved the performance review process to

ensure fairness, rebuild employee trust, and eliminate bias and abuse.

Flexible work arrangements were encouraged, allowing regular and

routine remote work to support employees with family or other outside

responsibilities (Holder , 2017, pp. 9-11).

f. Selecting and Retaining the Best

Employees to Strengthen Culture

Research indicates that companies with high-integrity cultures out-

perform those without. Hiring the right people is the first step, followed

by linking accountability and compensation at all organizational levels.

By tying the company’s values—such as diversity, inclusion, and ethical

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Feriel-Boughaba H. - Ilhem B.

business practices—to executive compensation, Uber ensured align-

ment with its new cultural goals (Belcher et al., 2018, p. 10).

4.3.1 Implementation: Transformational

Leadership of Dara Khosrowshahi

Dara Khosrowshahi was tasked with transforming Uber from a scan-

dal-ridden startup into a more conventional and ethical business, while

preserving the qualities that made it successful.

As a leader, he expressed empathy and emotion toward staff, offer-

ing them confidence that in times of fear or failure, he would be there

to support them—a crucial step in achieving great things. Unlike his

predecessor, Travis Kalanick, Khosrowshahi maintained a composed

demeanor and demonstrated respect for women. He remained focused,

took calculated risks, and consistently sought ways to simplify tasks

for employees, adhering to the KISS principle “(Keep It Simple, Stupid”

(Kumari & Sharma, 2019, pp. 12-13).

a. Cultural Modifications

Uber acknowledges that its values are intrinsically tied to its culture and

promotes these principles as part of its corporate identity (Huffington,

2017). Under Khosrowshahi, Uber replaced its old values with new ones

that rejected the previous toxic culture. The company’s current values

include (Uber Company, 2023):

Could You Get It

Trip Obsessed

Build with Heart

Stand for Safety

See the Forest and The Trees

One Uber

Great Minds Don’t Think Alike

Do the Right Thing

b. Organizational Structure

Significant changes to Uber’s organizational structure occurred after

Khosrowshahi became CEO.

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Rebuilding organizational culture through transformational

leadership: success lessons from Uber’s experience in startups

Figure 2- Uber’s Organizational Structure Before and after

Source:

(Uber Company, 2021)

The figure show that the senior management team experienced

considerable reshuffling. The board of directors was seeking a Chief

Operating Officer (COO) to share the responsibilities of the CEO—a

role Kalanick had previously rejected, as he was unwilling to delegate

authority. However, Khosrowshahi brought in Barney Harford, former

CEO of Orbitz, as Uber’s first COO in late 2017, emphasizing indepen-

dence in leadership (Zeballos, 2018).

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Feriel-Boughaba H. - Ilhem B.

c. Diversity and Inclusion

Khosrowshahi worked to improve female representation and promote

inclusion among employees from diverse national backgrounds.

•

Female Representation

Following Kalanick’s dismissal and rising demands for transparency,

Uber began releasing data about its workforce composition. The first

report was published in 2017 during heightened scrutiny following alle-

gations of sexual harassment and discrimination.

Figure 3 - The Evolution of Uber’s Female Representation

Source:

(Uber Company, 2022) & (Statista, 2023)

The data shows an increase in the proportion of women employed at

Uber over time, particularly when compared to 2016, when Kalanick’s

hostile behavior toward women was at its peak. This demonstrates

Khosrowshahi’s commitment to implementing audit recommendations

and enhancing female representation at the company.

d. Demographic Diversity

Uber has also made strides in improving staff diversity by hiring em-

ployees from a wide range of nationalities, as recommended by the

audit committee.

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Rebuilding organizational culture through transformational

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Figure 4 - The Evolution of Gender Representation at Uber

Source:

(Uber Company, 2023)

As the chart illustrates, Uber has increased the representation of mi-

norities, although the majority of its workforce remains white, largely due

to its US-based operations. Despite this, Uber has received numerous

awards for its efforts in diversity and inclusion under Khosrowshahi’s

leadership.

e. Achievement: Uber’s Leadership Comeback

Lyft remains one of Uber’s major competitors in the USA. The following

comparison of revenue growth between the two companies highlights

the impact of Uber’s leadership transformation:

Table 2 - Revenues for Uber and Lyft (Millions of dollars)

2015

2016

2017

2018

2019

2020

2021

2022

2023

Uber

1.5

6.5

7.5

11.3

11.4

17.46

31.88

37.3

Lyft

0.34

1.06

2.16

3.62

2.36

3.21

4.4

Source:

(Statista, 2023)

Based on the data, Uber experienced a remarkable growth rate of over

300% in 2016, far exceeding that of traditional businesses. However,

in 2017, the company’s growth rate plummeted to 15% due to various

crises, including legal disputes, harassment complaints, and the #Dele-

teUber campaign. This sharp decline was especially concerning for a

startup, particularly as Lyft capitalized on Uber’s setbacks, achieving

over 200% growth.

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Feriel-Boughaba H. - Ilhem B.

By 2018, Uber’s growth rate rebounded to over 50% thanks to orga-

nizational and leadership changes. However, this still lagged behind

Lyft’s 100% growth, indicating that Uber’s cultural transformation needed

time to fully take effect. In 2020, global lockdowns due to the pandemic

reduced growth in the transportation sector for both companies. In re-

cent years, Uber has regained its competitive edge, achieving an 80%

growth rate compared to Lyft’s 20%. This resurgence demonstrates that

the stringent standards Khosrowshahi put in place to repair Uber’s rep-

utation—such as increased transparency, regular financial disclosures,

and diversity reports—are finally paying off.

5. Discussion

Uber, recognized as one of the most significant and successful start-

ups globally, revolutionized the vehicle-for-hire (VTC) industry with its

innovative technology and organizational model. Initially, Uber achieved

remarkable success through its simple app-based platform, disrupting

the traditional taxi market and quickly establishing a dominant position

with minimal competition. The company’s rapid growth and substantial

revenue generation positioned it as a market leader.

However, compared to its competitors, Uber’s growth began to slow.

This decline was largely attributed to severe internal issues within its

organizational culture, which was characterized by a toxic, market-driven

environment. The company faced multiple scandals, including sexual

harassment, racial discrimination in hiring practices, and gender bias that

favored men over women and white employees over other minorities.

These problems were exacerbated by a profit-driven mindset that of-

ten-disregarded legality and ethics in its methods. The root cause of these

issues was the leadership style of CEO Travis Kalanick, whose autocratic

and confrontational approach led to widespread employee dissatisfaction.

In response to the crisis, Uber’s board of directors formed an audit

committee to assess the situation and recommend corrective actions.

The first major step was the replacement of Kalanick with Dara Khosrow-

shahi as CEO. Khosrowshahi introduced a transformational leadership

style, driving significant cultural changes within the company. He began

by redefining Uber’s core values, explicitly rejecting the problematic

ones of the past. His leadership also involved a restructuring of the

organization, including the creation of new executive roles, such as the

Chief Operating Officer, to decentralize decision-making and reduce the

concentration of power. Additionally, Khosrowshahi prioritized increasing

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Rebuilding organizational culture through transformational

leadership: success lessons from Uber’s experience in startups

female representation and promoting demographic diversity, while also

emphasizing transparency through the publication of annual reports

detailing the company’s policies and financial performance.

Khosrowshahi’s leadership successfully restored Uber’s reputation

and reestablished its position in the market. The company’s recovery

highlights the crucial role that effective leadership and a positive orga-

nizational culture play in overcoming crises and achieving long-term

success. Transformational leadership, coupled with strategic cultural

reforms, proved essential for navigating challenges and regaining mar-

ket dominance.

Uber’s experience underscores the importance of addressing organi-

zational culture and leadership to ensure business success. Companies

must adapt their cultures to align with their missions, foster continuous

growth and education, and remain resilient in the face of change. By

learning from Uber’s journey, startups can improve their chances of

success and achieve sustainable growth.

Consequences of Autocratic Leadership: Travis Kalanick’s auto-

cratic leadership style significantly contributed to the creation of a

toxic organizational culture. This led to major scandals, including

instances of sexual harassment and racial discrimination, under-

mining both employee morale and the company’s reputation.

Cultural and Organizational Crisis: Uber encountered a profound

cultural and organizational crisis, stemming from a profit-driven

mentality that often overlooked legal and ethical standards. This

approach resulted in a damaging impact on the company’s brand

and overall performance.

The Critical Role of Transformational Leadership: Dara Khosrow-

shahi’s introduction of transformational leadership was pivotal in

reshaping Uber’s organizational culture. His leadership empha-

sized a redefinition of core values, greater inclusivity, and increased

transparency, all of which were instrumental in addressing the

company’s internal dysfunction.

Rebuilding Reputation and Trust: Through transformational leader-

ship, Uber was able to effectively restore its reputation and rebuild

trust among employees, customers, and investors. This shift not

only rejuvenated its public image but also solidified its position in

the competitive market.

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Impact of Cultural Reforms on Organizational Success: The cul-

tural reforms implemented under Khosrowshahi’s leadership were

fundamental in transforming Uber’s internal environment. These

changes fostered a more positive workplace culture, contributing

to the company’s long-term sustainability and growth in a highly

competitive industry.

Based on the findings from the Uber study, here are some suggestions

that could help improve its cultural and organizational performance:

Startups should prioritize transparency in internal decision-making

and communication with stakeholders. This helps build trust and

provides employees and customers with a sense of security and

fairness.

Startups are encouraged to adopt a transformational leadership

style that focuses on changing organizational culture by motivating

employees toward creativity and innovation. This type of leader-

ship can improve team performance and create a healthy work

environment.

It is essential for companies to commit to promoting diversity and

inclusion within their teams. Improving the representation of women

and employees from different cultural backgrounds contributes to

better performance and reduces cultural biases.

Companies should focus on developing leadership skills among

their managers through training programs that aim to improve

leaders’ ability to adapt to cultural and administrative changes.

In the face of rapid changes in modern work environments, compa-

nies need the ability to adapt to cultural and structural challenges

continuously. This requires flexible strategies capable of managing

changes effectively.

Companies should ensure that their values and organizational

culture align with their strategic objectives. This will strengthen

the company’s reputation and promote long-term sustainability.

This includes creating an environment that allows employees to

freely express their opinions, offering emotional and professional

support, which helps increase employee satisfaction and produc-

tivity.

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leadership: success lessons from Uber’s experience in startups

During the process of writing the study on Uber, several limitations

were encountered Limited access to Uber’s internal reports and docu-

mentation made it challenging to gain a comprehensive understanding

of the company’s internal operations and decision-making processes.

The study relied heavily on publicly available data, such as financial

reports, news articles, and interviews, which may not provide a complete

picture. another limitation of the study was the reliance on documented

cases and reports to discuss issues such as toxic leadership and work-

place harassment, which may have been influenced by confidentiality

agreements or legal constraints, potentially excluding other significant

incidents.

6. Conclusion

Uber’s experience demonstrates that transformational leadership

is not merely a tool for managing change, but a foundation for re-

building organizational culture and fostering a healthy, sustainable

environment within companies. Through the leadership transformation

witnessed at Uber under Dara Khosrowshahi’s direction, it became

evident that the profound impact of leadership extends beyond rep-

utation recovery to include the promotion of transparency, inclusivity,

and equality within the workplace. The company proved that address-

ing cultural and organizational crises requires a strong commitment

to values and ethical principles that guide the organization toward

sustainable success.

From this experience, valuable lessons can be applied across many

other sectors, highlighting the importance of transformational leader-

ship as a key tool for driving innovation, enhancing sustainability, and

adapting to changes. Startups must understand that their growth is not

solely tied to revenue or market share but also to the strength of their

organizational culture, which can be the determining factor in overcoming

crises and achieving sustainable growth.

The future holds numerous challenges and opportunities in the field of

transformational leadership, especially with the rapid changes in modern

work environments. Companies should continue adopting strategies

that focus on developing a flexible organizational culture, while also

strengthening leadership training that aligns with contemporary values

and practices. Furthermore, learning from Uber’s journey can help start-

ups overcome their cultural and organizational obstacles, ensuring the

achievement of sustainable growth and a bright future.

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Feriel-Boughaba H. - Ilhem B.

This study opens up several future avenues that could contribute to a

deeper understanding of the role of transformational leadership in start-

ups and the business sector in general. Some of these avenues include:

The Effect of Transformational Leadership on Enhancing Diversity

and Inclusivity in Startups

Rebuilding Corporate Reputation After Cultural Crises: A Case

Study of Uber and the Impact of Transformational Leadership

The Role of Leadership in Shaping Work Culture and Developing

a Healthy Environment in Startups

Transformational Leadership in Addressing Organizational Chal-

lenges

Adaptive Leadership Strategies for Overcoming Organizational

Crises in Startups

The Impact of Transformational Leadership on Innovation

The Relationship Between Transformational Leadership and Em-

ployee Satisfaction

The Impact of Cultural Transformation on Sustainable Growth in

Tech Companies.

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Uber Leadership Skills

Prompt to Clone This Uber Leadership Skills

Apply this example's core structure, strategic pacing, and structural hierarchy directly to your own topic.

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