A Dean’s View of Goldman’s Mess

Darden Dean Bob Bruner

“…To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for…. I am sad to say that I look around today and see virtually no trace of the culture that made me love working for this firm for many years. I no longer have the pride, or the belief…I knew it was time to leave when I realized I could no longer look students in the eye and tell them what a great place this was to work.”

–Greg Smith, New York Times, March 14, 2012

“It wasn’t an easy decision to leave Google. During my time there I became fairly passionate about the company… The Google I was passionate about was a technology company that empowered its employees to innovate. The Google I left was an advertising company with a single corporate-mandated focus… From this innovation machine came strategically important products like Gmail and Chrome, products that were the result of entrepreneurship at the lowest levels of the company. Of course, such runaway innovative spirit creates some duds, and Google has had their share of those, but Google has always known how to fail fast and learn from it. In such an environment you don’t have to be part of some executive’s inner circle to succeed. You don’t have to get lucky and land on a sexy project to have a great career. Anyone with ideas or the skills to contribute could get involved. I had any number of opportunities to leave Google during this period, but it was hard to imagine a better place to work. But that was then, as the saying goes, and this is now… Truth is I’ve never been much on advertising. I don’t click on ads. When Gmail displays ads based on things I type into my email message it creeps me out….The old Google was a great place to work. The new one?”

–James Whittaker, blog, March 13, 2012

“I am writing to say goodbye. Recently…a hedge fund manager who was also closing up shop…was quoted as saying, “What I have learned about the hedge fund business is that I hate it.” I could not agree more with that statement. I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America.”

–Andrew Lahde, Financial Times, October 17, 2008

What meaning shall we make of these letters? One of my great teachers, C. Roland Christenson, once remarked, “Professional schools are good at teaching you how to do a job, but give little attention to how to enter or exit.” Nor is there any guidebook to letting folks know what you think as you stride out the door for the last time. It’s no wonder then that the rare publication of a “parting shot” letter creates a certainfrisson in the media. Such occurred last week when the first two messages went public; the third created a stir in 2008. There was much discussion on the merits of the writers’ views (the comments on the letters are at least as entertaining as the letters themselves). But no one paused to reflect on what it takes to exit well under adverse circumstances. To what extent are dignity, grace, justice, and self-respect served by a “parting shot”?

THE THREE ATTENTION-GRABBING ELEMENTS OF A ‘PARTING SHOT’

In the interest of brevity, I‘ll leave it to the interested reader to read the full text of the three letters. From this small sample, you might conclude that if you want to write a “parting shot” that will gain attention, it should contain at least three elements:

· Grief. All three letters state how unhappy the authors are that things have changed. Greg Smith alleges that Goldman Sachs has become morally bankrupt. James Whittaker grieves that Google has lost its entrepreneurial flair and intrudes into personal privacy, and that Google+ doesn’t challenge Facebook. Andrew Lahde is unwinding his firm, having profited from a massive short position against subprime debt—that play won’t be profitable any longer.

· Loathing. The three letters brim with contempt—and as the publishers of the lurid supermarket tabloids show, contempt sells. Andrew Lahde despises the “idiots,” the “people stupid enough to take the other side of my trades,” and the Ivy League Aristocracy. Greg Smith despises traders (the Andrew Lahdes, perhaps) who disrespect their clients. And James Whittaker has issues with Larry Page and the advertisers.