Picking up the Pieces from 'Bloody Monday'We Do, Indeed, 'Live in Interesting Times'
Lehman Brothers, after being in the business for 158 years, is now to be referred to in the past tense. Yes, the biggest bankruptcy in history was filed yesterday, September 15, 2008. The day will go down in history for a couple of other reasons:
This Monday makes last week's Freddie and Fannie bailout story seem like a generation ago.
I thought I would spend a couple of minutes on the other aftermath no one is talking about: the employees and the customers!
I will leave it up to the experts to stress their own theories as to what caused us to get here. But we are here, and it looks like that we will be here for a while.
So, in this political season while the Democrats and the Republicans blame each other for this financial 'mess' the country is in, I thought I would spend a couple of minutes on the other aftermath no one is talking about: the employees and the customers! Both constituents need nurturing and trust. And what they - the customers and the employees - return in response to this is confidence. The confidence any organization needs to survive and grow, irrespective of the product and services they offer.
I don't have any accurate numbers on the number of customers Lehman Brothers or Merrill Lynch had before this historic Monday. I do have some approximate number of employees that worked for these giants; Merrill Lynch - 60,000 employees, Lehman Brothers - 26,000 employees. Some early estimates show that about 30,000 employees will lose their jobs in New York City alone.
Given the long history of both of these firms, I personally know a number of employees at these companies who are referred to in the corporate world as the 'Lifers.' Lehman and Merrill were as much a part of their lives as attending their children's soccer practices (mind you, while keeping an eye on their BlackBerrys). These people feel betrayed. Betrayed by their management and the system they helped create, and that was supposed to provide transparency. There is a loss of confidence!
Now, let's talk about the customers of these firms for a little bit. These customers put their confidence in these firms to protect their assets. There is a contract between these firms and their customers -- sometimes formal, while at other times in the form of a simple expectation. These customers feel let down. I cannot stop thinking - had the Merrill-BofA acquisition deal not materialized over the past weekend, what would have been the fate of millions of their customers?
So, what's the connection between the events of this week on Wall Street and what happens on main street? It's not just Wall Street that has customers and employees. Every organization has them and needs them to survive. Merrill, Lehman, AIG, Freddie, Fannie, Bear Sterns, IndyMac and the 10 other banks that went bankrupt (so far) this year continue to do their share of eroding the customers' and the employees' confidence.
If you have not addressed this with your organization's customers and employees - the reasons for them to continue to have confidence in your institution - then now is a good time to do so. Give them the reasons why you won't be the next big headline.
I am finally getting to (somewhat) understand the true meaning of the famous Chinese proverb 'May you live in interesting times.' And interesting times these are. I have also been told that this proverb is the first of the three curses. The other two:
"May you come to the attention of those in authority"
"May you find what you are looking for"