It was just a couple of weeks ago that Greg Smith wrote a scathing OpEd for the New York Times about his former employer, Goldman Sachs, on his way out the door.
But it feels like an eternity.
Smith wrote, during his 12 year tenure, the culture at Goldman shifted from valuing teamwork and “always doing right by clients” to one where people “callously … talk about ripping customers off.”
He went on to say, “Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail.”
The piece ran on the second day of new corporate communication chief, Jake Siewert.
I readily admit I don’t know, if I were him, I wouldn’t just turn around and go home, claiming it wasn’t what I signed up for…or if the adrenaline would kick in, I’d roll up my sleeves, and get to work.
Siewert chose the latter and has been doing damage control for the past 10 days.
There has been some debate among the business and PR communities regarding how Goldman Sachs should respond.
Some think keeping silent is exactly what they should be doing. While others believe taking a stance against Smith and showing how they put customers first is the right response.
I’m in the latter camp.
As it stands, the only thing Goldman Sachs has said is this:
We disagree with the views expressed, which we don’t think reflect the way we run our business. In our view, we will only be successful if our clients are successful. This fundamental truth lies at the heart of how we conduct ourselves. We stand by that fundamental truth.
Of course they disagree with what’s been said, but they look defensive in this statement (and how many times can they say “fundamental truth” in one statement?).
I’m not the only one who thinks so. They lost $2.15 billion when the stock market took notice of the media storm.
Perhaps a better statement would have been:
We are saddened to learn Greg Smith, a loyal and valuable asset to our team for 12 years, has chosen this very public forum to air his grievances with our firm. We built our culture 140 years ago on putting clients first and it has grown to also include our communities around the globe. We stand by that fundamental truth.
Then Seiwert and his team could have gotten to work to showcase the stories that put clients and community first.
Silence rarely is the best defense in a crisis situation. Perhaps if their PR chief weren’t filling out his HR paperwork and logging on to his computer for the first time when this happened, things would have been handled a bit differently.
This is why a crisis management plan is your best insurance. Without one, the executive team, the lawyers, and the communication team don’t know what to do or say. They react, just like Goldman Sachs did here, instead of play offense.