Uber’s chief operating officer and chief marketing officer are stepping down after chief executive Dara Khosrowshahi decided to take more control of operations, the company said on Friday.
Barney Harford, chief operating officer and Mr Khosrowshahi’s top deputy, will be replaced by two executives who will manage its biggest businesses — ride-hailing and food delivery — and report directly to the chief executive.
“This will allow me to be more hands-on and help our leaders problem-solve in real time, while also ensuring that we make our platform vision a reality,” Mr Khosrowshahi wrote in an email to staff announcing the changes. The chief executive has spent much of his time since joining Uber in 2017 on working to improve relations with regulators around the world and preparing the company to go public.
Mr Khosrowshahi said he and Mr Harford agreed the change meant that “the COO role no longer makes sense” and as a result Mr Harford was choosing to leave.
Rebecca Messina, who joined Uber as head of marketing from Coca-Cola in September, is also leaving after Mr Khosrowshahi moved to combine the company’s marketing operations with the communications and policy team.
“Marketing is so important to our business and our brand continues to be challenged,” he said of the reorganisation. “It’s increasingly clear that it’s crucial for us to have a consistent, unified narrative to consumers, partners, the press and policymakers.”
The leadership overhaul comes a month after the ride-hailing company’s disappointing initial public offering. Uber shares traded above their $45 IPO price for the first time this week, although the stock shed 1.7 per cent on Friday to close at $44.16. The shares fell as much as 2 per cent in after-hours trading after the executive departures were announced.
“There’s never really a right time to announce departures or changes like this, but with the IPO behind us, I felt this was a good moment to simplify our organisation and set us up for the future,” Mr Khosrowshahi said.
The moves were met with scepticism by some observers.
“It is hard to see that having Dara directly control more of Uber’s work, with less help, will solve Uber’s problems,” said Erik Gordon, a professor at University of Michigan’s Ross School of Business.
Ygal Arounian and Daniel Ives, equity analysts at Wedbush securities, wrote in a note to clients that the news “comes as a shock to the Street and clearly one of the last things investors wanted to see with the stock currently coming under pressure”.
But they added: “By having the leadership teams of rideshare and Eats [food delivery] report directly to him, Dara and Uber are more clearly focusing on optimising the full consumer value proposition to drive increased per [monthly active customer] rides across both platforms.”
Mr Harford was one of Mr Khosrowshahi’s first executive hires after he joined Uber in 2017 in the wake of a series of scandals and allegations of a sexist culture that resulted in the ousting of co-founder Travis Kalanick. The two men have a long professional history, having worked together at Expedia when Mr Khosrowshahi was chief executive of the travel company.
Mr Harford’s leadership style drew mixed responses at Uber, according to employees and people close to the company. Last year he was the subject of complaints over alleged insensitive comments about women and minorities. That created an awkward situation for Mr Khosrowshahi, whose mandate included repairing Uber’s tarnished reputation and reforming its toxic culture.
Uber conducted an investigation into claims of discrimination and found them unsubstantiated. Mr Harford agreed to work with an executive coach and undergo diversity and inclusion training.
But some workers felt that the company’s handling of the case of Mr Harford differed from how it treated complaints against other senior figures, such as its head of human resources who resigned during the same period following an investigation into anonymous complaints over how she handled employee grievances.
More recently, some employees questioned how much Mr Harford was being paid at an all-hands meeting before the IPO. Uber’s IPO registration statement revealed that his compensation package totalled $47.6m in 2018 — more than any other executive, including Mr Khosrowshahi, that year.
Uber said that was due to stock and option awards set to vest over several years but which were recognised in the year they were granted. Mr Harford’s departure means he will not receive the entire value of those awards.
The shake-up will put the focus on three long-serving Uber executives. Andrew Macdonald, who joined in 2012 to run operations in Toronto and has overseen Asia and Latin America as well as global business development, will lead Uber’s largest business, global ride-hailing.
Jason Droege, head of the Uber Eats food delivery business, will report directly to Mr Khosrowshahi. He joined Uber in 2014 but his relationship with Mr Kalanick goes back to the late 1990s when they were among the co-founders of the file-sharing company Scour.
Jill Hazelbaker, communications and policy chief, will expand her portfolio to include marketing. The veteran of Google, Snapchat and John McCain’s presidential campaign was hired by Mr Kalanick in 2015. She has become a close adviser to Mr Khosrowshahi, travelling frequently with him on his visits to government officials and investors.