3 Company Saving Takeaways From “Why I’m Leaving Goldman Sachs”
Posted on April 11, 2012 by Leslie Dickson
After being the source of public discontent for almost four years, Goldman Sachs’ reputation took another hit in the form of an op-ed piece from former employee Greg Smith, entitled, “Why I’m Leaving Goldman Sachs”. An Internet sensation, the article’s debut in the New York Times, has sent Goldman Sachs’ public image into free fall.
Although the firm will likely debate the accuracy of Smith’s claims, the article raises a number of concerns about how companies continue to do business. If you want to prevent a public relations meltdown or even a financial crisis, learn the business lessons found in Smith’s article.
#1. Meet Customer Needs
According to Smith’s article, Goldman Sachs has one priority: profit. In practice, this meant guiding customers to trades that will bring “the biggest profit to Goldman,” and advising clients to invest in unprofitable stocks the firm is “trying to get rid of.”
In VoicePRO’s Sales Engagement workshop, we emphasize that a sales strategy must focus on meeting customer needs. Anyone who has entered a sales-driven retail setting can tell you how off-putting it can be. The conversation feels fake, the salesperson suggests items you don’t want or need, and you begin to distrust any advice the staff gives you.
If customers don’t trust you, they won’t recommend you or continue to purchase your products. In some cases, failing to meet their needs can incite anger. Eventually, they take their business somewhere else.
Instead, adopt a customer-centric sales approach. Treat the situation as if you don’t care whether or not you make a sale. Ask as many probing questions as possible and make your product recommendations accordingly. If your customers know you have their best interests at heart, they will trust you, and keep coming back—again and again.
#2. Treat Customers With Respect
In one of the article’s more shocking paragraphs, Smith describes the language management used about their clients:
“Over the last 12 months, I have seen five different managing directors refer to their own clients as ‘muppets,’ sometimes over internal e-mail.”
In this context, the term muppet means fool or idiot. Of course, treating clients with disrespect is an easy way to lose business. But the more troubling aspect of this claim is that the emails are coming from the organization’s leaders.
As a leader, you set an example for your employees, and the office culture mirrors your values. At Goldman Sachs, employees were essentially given a license to insult clients. And what goes on within a company will manifest itself on the outside every time. If you deny such behavior or try to change it later on, you will be viewed as a hypocrite. So save your reputation and the reputation of your business by always treating your customers with respect, even when they’re not in the room.
#3. Promote True Leaders
As Smith detailed the current culture of Goldman Sachs, he indicated leaders were chosen based upon their earnings for the firm, instead of their leadership skills. In addition, leadership candidates were required to match their leaders’ value system, unethical though it might be.
One of the more dangerous habits of leaders is their tendency to promote like-minded employees. However, as an Entrepreneur magazine contributor indicates, the other leaders within your business should offset any of your own leadership weaknesses. A group of people with similar thoughts and backgrounds may get along but they’re likely to make the same mistakes. Fill your team with a diverse set of skills and personalities for better results.
For many years, Goldman Sach’s was a model business for success and customer satisfaction. Now they’ve become a model of what to avoid. Luckily, it’s not too late for your business. Learn from Sachs’ mistakes to avoid their fate and save your company.
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