Leading Organisations Assignment

In this assignment, I will attempt to explore how Zipcar CEO Robin Chase leadership style and how a
miscalculation almost led to its collapse in the early 2000s. To achieve a conclusion, I will analyse her
strengths and weaknesses as a leader. What led her to make such a miscalculation that put the
viability of the business in question. I will then apply some recommendations on how I would have
differed in my approach to find a solution, and the changes I would have implemented.

Robin Chase is a charismatic, culturally aware and empathetic person who started the Zipcar
business with the mission to change how city dwellers utilised vehicles to create an upside for the
environment and save consumers/user money. Although Robin was aware that a blueprint business
model for a car-sharing business had before been attempted and failed by big car rental industry
players and car-sharing programmes using government grants, she decided to take a risk and carve
out a new business model which she believed would reach profitability. Ultimately, however, her
strengths and weaknesses as a leader led her to contradict her business strategy and almost led to
the business’s early demise.

Robin displayed several characteristics of a transformational leader throughout her life and career.
This ultimately helped to define the Zipcars future mission, team and pricing model, and get the
business to a point where the concept of a car sharing entity had been validated

So, how does Robins leadership support her mission? Robin Chase management style focuses on The
Trait Approach to Leadership, particularly openness and conscientiousness. This has created an
environment where the team is pulling in one direction, working to create something that is doing a
better good.

As the companies assigned leader Robin has created and maintained a clear vision of what Zipcar
was trying to achieve as a business for its customers and stakeholders – utilising wireless technology
“provide urban dwellers with convenient, reliable, fast access to cars”.

Robin has incorporated the theory of Corporate Social Responsibility and business ethics into her
business, by following a solution which supports concern for the environment and a policy the whole
company can get behind, further validating her autonomous leadership.

As a risk-taker, Robin was confident in her abilities to build a new business model for a product in a
market which had previously been seen as non-viable. She took secondary research and took this
from proof-of-concept into a functioning business. Robin is a visionary with the ability to be able to
foresee the capabilities of new technology, and its future advancements and how this creates new
possibilities

So, how does Robin use her leadership to support her team? Robin truly values her team and is
empathetic towards their cause and abilities. She has “real respect for peoples skill sets. She is trying
to lead in a charismatic/value-based leadership
Robin allows her team to make mistakes. She states, “one or two mistakes doesn’t diminish
someone in my eyes”. This incubates an environment of creativity and innovation and enables the
team to flourish in a fast-paced start-up environment creating roles with excellent levels of role
ambiguity.

Growing up Robin was exposed “to a variety of cultural norms and customs” and “learned, for
example, the importance of respecting all people”, thus creating diversity and allowing the team to
play to their strengths and discouraging groupthink. This is also evident in her hiring outside of the
industry for individuals’ skill set, idea creation and the value they can bring to its mission.

Robin is a participative leader who often valued her colleagues’ input and built a team of “can-do,
non-complainers who were ingenious [and] didn’t need a lot of oversight” which created an
entrepreneurial business that cut its own path. Often tasks have a weak task structure.

Robin showed tremendous tenacity to fundraising for the business in an era that saw decreasing
investor confidence levels. She met with over 100 potential stakeholders to ensure the company had
the capital to scale, eventually securing $1.2m.

She also showed ingenuity by showing at the fundraiser of another start-up when Zipcar required an
emergency cash injection, which she was successful in obtaining

Robin also showed an eye for creativity to keep costs down in the early days of the business. This
was demonstrated by examples such as utilising Larry Slotnick’s love of bikes to travel between cars,
thus eliminating the need for a second driver. Such agility is what propels start-up leadership

So, how did Robin cope with the Zipcar Pricing Model? The pricing of the Zipcar product is where
Robin showed her greatest weakness. Firstly, she used Communauto and European car-sharing
outfits to benchmark the companies pricing model. This goes against her philosophy that “she did
not want Zipcar to be uttered in the same breath as Hertz or Avis”. These companies’ conditions may
be considerably different from Zipcar due to being in other locations/countries, therefore hold no
significant relevance to Zipcars revenue model.

Robin also made showed weakness in accepting David Bell as expert power in his conclusion that she
should “stop worrying about it. You just put up the price, and then you can change it. Make your
best guess and go”.

This is the miscalculation origination because Robin tried to benchmark Zipcars prices to those of the
market, even though the market had little relevance. Robin then trusted a David Bell, a pricing
expert. He suggested she changed her prices once they were in business, even though Robin would
have known that this would be operationally challenging, reputationally damaging and would
require significant backend development. This was against the advice of her paid advisors. Robins
background in trusting her abilities hindered her thinking on this occasion. Her weakness has always
been in maths, so she should have delegated this task.

What are my recommendations?

I would try to be the same transformational leader with charismatic/value-based leadership qualities
as Robin Chase. I believe her ability to hire people based on their skill set rather than industry
experience is the right approach to create an innovative, can-do environment where idea creation is
rewarded. With a weak task-orientation structure in place, the business can be agile enough to
respond to a crisis such that Zipcar found itself. I would recommend that Robin Chase listens to
external paid advisors because they can often give impartial and independent advice without the
fear of hurting the founders’ feelings. This can enable Robin to step back from the situation and ask
if the pricing model based on other companies experiences is viable, or if they should start again
until they reach a model that breaks even, and is then scalable. Instead, Robin finds herself in a
situation where she isn’t likely to break even without alienating herself from 400 members Zipcar
already has onboarded.

My recommendations;

1. Be honest with the 400 members (they will appreciate it), and contact them about the
situation, and how you Zipcar are going to have to raise prices to survive
2. Continue to nurture an environment that champions innovation, but ensure that you listen
to external advise when it is in an area, you are not familiar with
3. Continue to cut their own path and not worry about their competition. Zipcar is an excellent
business with a worthy mission, well set out vision and company values that will create its
own support and follow over time.