Theranos and the Modern Workplace
After months spent on the waitlist to check out Bad Blood: Secrets and Lies in a Silicon Valley Startup by John Carreyrou from the library, my mom informed me that she had already purchased a Kindle edition. Cue the kind of eyeroll only a mother can incite. Bad Blood, expanded from Carreyrou’s reporting for the Wall Street Journal, accounts the rise and fall of blood-testing ‘unicorn’ Theranos and its CEO Elizabeth Holmes.
A year since Bad Blood hit the presses, I already knew the broad strokes of the Theranos scandal and some about Holmes, especially her much-parodied practice of affecting a deeper voice. So on finally reading the book, I was relatively less astounded by the false promises, blatant lies, and fierce delusions that littered the page, infiltrated the lives of Theranos employees, and governed the minds of Holmes and her investors. In the gap where shocked disbelief might have risen, instead, I searched for the lessons the Theranos scandal might have for a ‘regular’ person, one existing outside the startup world and without the boatloads of money to invest.
And what did I find? The worst tendencies of the modern workplace brought to a frightening head.
One might conflate the management and morale problems that plagued Theranos with the illegal and morally dubious actions of its CEO. Holmes fully contributed to the mismanagement of the workplace in trying to obfuscate and encourage illegal/unethical activities, but that does not necessarily mean that these workplace issues would have disappeared had the company been above-board. In Carreyrou’s depiction of Theranos, I see three common workplace issues brought to an extreme: departmental silos, work-life balance, and leadership.
Organizations in all fields, from business to government, struggle with the departmental silo issue. At Theranos, groups working on different aspects of the blood testing technology were completely siloed. For example, the biochemists designing a way to test tiny amounts of blood worked separately from the engineers designing the equipment to test the blood. “Both reported up to Elizabeth but weren’t encouraged to communicate with each other” (p. 20). As a result, when the technology failed, as it did continuously throughout the Theranos saga, no one could be sure of the cause, which prevented any real progress on the technology. If Holmes had allowed the free flow of information between groups at Theranos, would they have successfully created the blood testing technology? Based on the constraints imposed by Holmes of using only one drop of blood and other technological limitations, probably not. However, it is likely that insights would have been gleaned from collaboration, that were impossible to achieve in silos. The Theranos example of the siloization serves to emphasize what many experts on organizational behavior have known for a long time: many modern issues in business and government can only be solved by engaging multiple perspectives and specialties, and silos disrupt workflow, inhibit problem-solving, and reduce productivity.
Similarly, work-life balance concerns also emerge at almost every organization and were intensified at Theranos. To Holmes “keeping a work-life balance seemed a foreign concept […]. She was at work all the time,” and expected the same of her employees (p. 97). Carreyrou reports that, “(o)ne of the assistants kept track of when employees arrived and when they left so that Elizabeth knew exactly how many hours everyone put in. To entice people into working longer days, she had dinner catered every evening. The food often didn’t arrive until eight or eight thirty, which meant that the earliest you got out of the office was ten” (p. 32). To some extent, the employees of Theranos seemed to by into the idea that the more time spent at the office, the better. Daniel Young’s routine of leaving the office at six every evening to have dinner was the source of “snickers behind his back from some colleagues,” before the long-term Theranos employee was promoted and his workplace behavior changed dramatically (long hours, drinking, etc.) (p. 168). Other passages about life at Theranos repeatedly mentioned employees burning out from the hours and stress. Intense surveillance aside, the lack of work-life balance displayed in the chapters of Bad Blood is in line with the workplace culture of many startups. The same is true of established businesses and in government, where recipients of so-called “cushy jobs” take work home with them everyday. Holmes’s emphasis on working long hours was one of many aspects that must have made Theranos a hellish place to work, but it is clear that working 50, 60 hours a week could not resolve the issues at the core of the company’s success. Organizations, for all the lip service paid to work-life balance, still hold employees working long hours as the ideal of dedication. Ultimately, this will lead to the organizations’ detriment in the form of attrition and burnout. Managers reading Bad Blood hopefully realize this.
Quality of leadership makes or breaks an organization. The cosmic file of poor leadership bursts with examples from Theranos: cavalier hiring and firing practices, unwillingness to listen to employee concerns, inappropriate office relations, nepotism, retaliation, unreasonable expectations, micromanagement, etc. The list goes on. One element of good leadership, Holmes seemed to possess at the beginning was vision. Holmes envisioned “(a)applying principles of nano- and microtechnology to field of diagnostics” by creating a device (at first a patch, later a piece of machinery) to monitor blood painlessly and instantly in a patient’s own home (later Walgreens pharmacies and Safeway wellness centers). However, Holmes prioritized her vision over everything, which led her to create unreasonable expectations for her employees, reject alternative ideas, and to ultimately mislead and defraud investors. Some, like Carreyrou himself, might read this point as a proliferation of unchecked ambition. He writes, “(b)y all accounts, she had a vision that she genuinely believed in and threw herself into realizing. But in her all consuming quest to be the second coming of Steve Jobs amid the gold rush of the ‘unicorn’ boom, there came a point when she stopped listening to sound advice and began to cut corners. Her ambition was voracious and it brooked no interference. If there was collateral damage on her way to riches and fame, so be it” (p. 299). However, I think ambition alone would not have resulted in the Theranos scandal he chronicles. Rather, I think it was the combination of her ambition, the obscene amounts of money given to her with little oversight, and her poor leadership skills that disposed her to act in illegal and unethical ways, not ambition alone.
The workplace issues that pervaded Theranos were not unique to the company. Rather, they were issues common to many organizations, exacerbated by paranoia and criminality. There are many lessons one can learn from scam at the heart of Bad Blood. Some might focus on the white-gloved hands of privilege, others on the duality of sexism. Still others might focus on the nature of government regulation or the healthcare system. Or, like me, you might have sat at your desk the next day and asked yourself, how much would I put up with for a vision?
