A tale of two CEOs

The nature of leadership in enterprise is more important than it has ever been and two recent CEO examples illustrate this perfectly - Travis Kalanick at Uber and Oscar Munoz at United Airlines.

Oscar Munoz had a heart transplant the same year he turned around struggling United Airlines.
Oscar Munoz had a heart transplant the same year he turned around struggling United Airlines.

It may not have been the case in the past, but the role of the CEO can no longer be divorced from the communications and culture of a company or enterprise.

The CEO sets the tone from the top, creates a culture that motivates employees, and builds an environment within which customers and stakeholders engage positively with brands and businesses.

Nothing illustrates this better than PRWeek’s Communicator of the Year for 2017, United Airlines’ CEO Oscar Munoz.

In late 2015, Munoz took on a daunting task in turning around an airline that had just lost its previous leader in unfortunate circumstances, was bedeviled by poor customer performance and service, and was struggling to integrate its merged sibling Continental a full five years after the deal had been done.

Eighteen months on, United’s share price has rebounded, employees are happy, all its labor deals have been signed unprecedentedly early, customer service has improved, and it has hired away two very senior executives from its larger rival American.

All this happened in a period when Munoz underwent a heart transplant that took him out of the game for a few months just a short time after starting his new post.

Compare that to Uber CEO Travis Kalanick’s travails over the same period. A recent blog post from former Uber engineer Susan Fowler started a media frenzy that reignited accusations against the rideshare company of a culture that turns a blind eye to sexual harassment and aggressive and homophobic behavior.

Some Uber riders and employees also saw Kalanick’s participation in President Donald Trump’s economic advisory council as tacit approval for the new administration’s hard-line approach on immigration – a sensitive subject in Silicon Valley, where many founders and workers are from immigrant backgrounds.

Then there was the video that emerged of Kalanick talking down to an Uber driver from the rear passenger seat, in full party mode while accompanied by two young women.

The company has also been accused of stealing intellectual IP to help it avoid detection by the law in cities where Uber is banned from operating.

It’s a perfect storm that comes over at best as careless and lacking in empathy, at worst as betraying a rotten culture and sense of core values.

Uber has made high-profile hires such as former Target CMO Jeff Jones, who came in as president of ride sharing last September, and Google’s Rachel Whetstone, who moved over from Google to become SVP of communications and policy in May 2015.

It’s fair to say those two excellent executives have a tough task on their hands to turn around messaging in this febrile environment.

There are some, including our guest on our latest The PR Week podcast - Simon Kelly from Story Worldwide - who believe the systemic culture at Uber will not change unless Kalanick either steps down or is ousted by investors at the company, where losses were predicted to be going to hit $3 billion in 2016 according to various media reports.

To be fair to Kalanick, after the Uber driver video incident he admitted to employees that he needed to "fundamentally change and grow up." Uber is now seeking a chief operating officer to help him "write the next chapter in our journey," said Kalanick.

Uber has engaged aptly named headhunter Heidrick & Struggles for the search, a firm that placed culture-changing individuals such as Eric Schmidt as CEO at Google and Satya Nadella as CEO at Microsoft. The likelihood is that this person will be a woman, in part to alleviate the negative optics around the company at the moment in terms of gender equality.

For his part, Munoz went into the beleaguered airline and freely admitted from the start that the implementation of the United/Continental merger had been rocky for customers and employees. He said the company had not lived up to its potential but that that was going to change.

His mantra was: "An airline is a people business – we have 86,000 of them and two-thirds of them have to get up every morning, every day, and every shift and do the right thing." Kalanick could take a note from that attitude, rather than berating one of his own drivers, no matter what the provocation or temptation might have been in those particular circumstances.

"I need to engage and create that shared purpose for our employees and we’ve been hard at work with that, from a labor perspective, from our management groups – we need to treat people better," admitted Munoz, who came from a blue-collar background in California and was the first member of his family to go to college.

The new spirit of United encouraged pilots, flight attendants, and other workers at the airline to stand with their CEO. "You don’t have to trade off efficiency and customer service in favor of profits," said Munoz.

He was helped in his mission by hiring the likes of Jim Olson from Starbucks as SVP of corporate communications and Emmy-award-winning TV producer Dana Brooks Reinglass as chief storyteller and MD of digital engagement.

Munoz summarizes his customer philosophy thus: "All good relationships are built on trust. We know that, and we know we have to earn yours – every day on every flight."

I’m sure we’ve all heard these platitudes before from airline CEOs on in-flight videos, but somehow when you listen to Munoz you believe it. It’s another sign of his ability to be a great communicator.

I’m also sure that people will still complain about their experiences flying United – I may well be among them sometimes. But in a brutally competitive and difficult business environment, Munoz has started the turnaround process with a very simple strategy based on transparency, authenticity, and effective communication.

That’s why Oscar Munoz, not Travis Kalanick, is PRWeek’s 2017 Communicator of the Year, and we look forward to bestowing upon him that honor next Thursday at the PRWeek Awards ceremony at Cipriani Wall Street.

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