There’s been considerable coverage over recent days about the disgruntled Goldman Sachs employee who has caused a media storm regarding how he allegedly believes the firm treats its clients.
There are some lessons to be learned here for all of us in the client relationship business that go way beyond Goldman Sachs and the investment banking business.
In a nutshell this is what has happened…
Greg Smith, a London-based manager said he was quitting after 12 years because he could no longer work there ‘in good conscience’. The open letter of resignation has sent shockwaves through the financial industry.
Mr. Smith claimed clients were branded ‘muppets’ and sidelined by senior directors who were more interested in making money (and presumably bigger bonuses) for themselves.
The banker said: ‘I attend meetings where not one single minute is spent asking how we can help clients. It’s purely how we can make the most possible money off them. It makes me ill how callously people talk about ripping off their clients.’
Writing in the New York Times, he added: ‘If you make enough money for the firm, and are not currently an axe murderer, you will be promoted into a position of influence.’
Cleary Greg was a very frustrated employee and angry that the company he joined has changed radically and he believes that it now does not match up to his own standards.
So what can we learn?
1) Modern media, particularly mediums such as Twitter, blogs, rolling news and even e mail (I received several links to this from friends in the first few hours after the story was breaking) now means a disgruntled employee can share their views with a news hungry worlds within minutes.
2) It’s not just unhappy clients that can harm your reputation, your staff can do just as much damage, especially if you are working for a high profile organisation.
3) Management needs to take extreme care when talking about clients within what might seem like the safety of your own offices.
Sure, we all have ups and downs with clients and customers and its only human nature that we will get on with some better than others.
However, particularly junior and middle ranking colleagues look to their client service managers to lead by example and will inevitably start to be disparaging about certain customers if that is the lead being set by those who they report to.
Creating a culture where some clients are referred to in disparaging terms does not help anybody – particularly those who have ultimate responsibility for the business as what will inevitably happen is that your best people will be reluctant to work with that client. The consequence often is creating second rate “ghettos” in the company and is often the first stage of a relationship that is in terminal decline.
Indeed, it’s not what you say about the clients – it also includes how you refer to fellow colleagues and indeed the company itself. Being bitter is not attractive.
4) Be very careful what you put in writing.We seem to be in a culture of whistle-blowers and there are knock on effects of this.
Emails that are often written in a haze of frustration are best not sent. Ask yourself the question – what would I make of this if I was new to the business or indeed an outsider who read this and didn’t know the context?
I have learned from a colleague who has a rule that if he has written something controversial he does not sent it until he re reads it the next morning, having given it what he calls his, “overnight test.”
5) The pace of change is radically reshaping most business. For many staff the organisation is very different from the one they joined. This case highlights the importance of ensuring that as a company changes and evolves the staff are brought along with it and understand the vision/standards that are expected of them.
It’s easy to say but even easier to forget or assume they know and is something that requires constant attention.
6) Ensuring that your vision matches that of your clients.
This story implies that Greg Smith believed that his former employer was more interested in making money at any price with each client.
I worked for many years in the advertising business where some colleagues believed that winning awards for the agency was more important than necessarily selling more of a client’s products. Needless to say those clients did not hang around for long
I’d be fascinated to get your views on this and to see if you think that there are any other lessons to be learned.