Disagreements at the top
This week the news reported the departure from their companies of two executives – both long-standing.
Greg Smith’s departure from Goldman Sachs, after 12 years, has been reported globally. This is not surprising – as everybody loves to hate bankers, and investment banks. The claim that Goldman Sachs viewed clients as “muppets” is a delicious image, and so it’s not surprising to see a journalistic feeding frenzy following Smith’s resignation letter, published in the New York Times on 14 March 2012.
The real question however is whether Smith’s departure matters. I think that it depends on what clients do, and I suspect that the answer will be very little or perhaps nothing. Obviously Goldman Sachs’s aim is to make money. In a testosterone fueled environment, bravado, where clients are called muppets and phrases such as “hunt elephants” (referring to getting customers to spend more with you) shouldn’t be a surprise. If anything, the discussion will raise again (for a few more weeks) the issue of banker remuneration. It may even have a salutary effect by making firms such as Goldman Sachs emphasise that ethical behaviour in business must be the norm, and that the 1980s dogma that “greed is good” is not an asset post the 2008/9 financial crisis. As Goldman Sachs has said in response:
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.
In fact, as the Economist suggests, the real muppet may be Smith himself, for not realising that clients aren’t stupid, and that if they weren’t getting value from the firm they’d move elsewhere. I suspect that the real reason for Smith’s resignation was sour grapes. Perhaps somebody got a bigger bonus. Whatever the reason, it’s unlikely he’ll find similar work with other banks – as no company will want to employ somebody who is quite so vocal in their condemnation of their former employer.
The more interesting departure however, from a strategic perspective, was that of Richard Brasher, the UK boss of the supermarket Tesco. Brasher was the most high profile departure since new CEO, Philip Clarke, replaced Sir Terry Leahy. Leahy retired from Tesco at the end of February 2011 and since then a number of other senior executives have left or are leaving the firm. These include
- David Potts, head of the Asian operations who will retire, aged 55, from Tesco in June;
- Andy Higginson, head of Tesco bank and former group finance and strategy director – also aged 55;
- David Reid, Tesco’s chairman – who was replaced by Sir Richard Broadbent in November 2011;
- Lucy Neville-Rolfe, Tesco’s director of corporate and legal affairs, who will retire from Tesco in January 2013. Lucy Neville-Rolfe’s role is being split into two – neither of which will be a board post;
- Richard Jones, Head of Clothing who has moved to the private Irish supermarket, Dunnes, taking the same role;
- Laura Wade-Gery, CEO of Tesco.com and Tesco Direct, and head of non-Food, who has moved to a board-level position with Marks & Spencer.
However it’s not just Brasher that seems to be finding a problem. The number of senior executives – especially long-standing executives – leaving Tesco suggests profound disagreements at the top.
David Reid was expected to retire and Tesco had been looking to appoint a new chairman to replace him. Potts, Higginson and Neville-Rolfe are also reported to be retiring. Their departures, so close together, suggests an unhappiness with Clarke’s management of Tesco as generally companies try and prevent large-scale boardroom changes to ensure continuity.
When a board is split over strategy and cannot agree, continuity is not possible. Management is all about consensus and agreement on the path that should be followed. If this is not possible there has to be change, with one side or the other leaving. The alternative is chaos, resulting in the company losing share and profitability as the focus moves to internal dispute, rather than market growth. This appears to be the situation at Tesco – forcing Philip Clarke to assert his authority. It was either his head or Brasher’s. As Clarke said: there can only be one captain.
Note: After writing the above article I came across a great Harvard Business Review blog looking in depth at Goldman Sachs culture and how it may have changed over the years since Greg Smith started (and why). Worth reading for any Goldman Sachs watchers:
http://blogs.hbr.org/fox/2012/03/greg-smiths-resignation-op-ed.html
Leave a Reply Cancel reply

Recent Posts
- Apple & disruptive innovation: 4 questions innovators need to ask before moving forward!
- X-mas Advertising: John Lewis, M&S and Debenhams Christmas Ad Campaigns Compared
- Competition or Co-operation? Collaborate & Co-operate to build and not to destroy.
- Freedom of Speech, Abuse and Social Media
- Pluralistic Ignorance
- Testing perceptions – Myers-Briggs and false appearances
- The iWatch – is this the next disruptive innovation from Apple?
- If you will it, it is no dream…
- The impact of disruptive innovation – on PCs and on Retail
- Why six-sigma, just-in-time and lean manufacturing are dangerous!
- Entrpreneurs 2012 – Con-Trick or Conference: a review!
- Microsoft’s Surface and Disruptive Innovation!
Archives
Topic List
Tag Cloud
AIIP Amazon analysis Apple applegate AWARE bias Bible Bing case study change China CI communication competitive analysis Competitive Intelligence Competitive Strategy competitor analysis competitors counter-intelligence decision making disinformation disruptive innovation Education ethics exalead Facebook Gaza Genesis Google Google Squared India industrial espionage information information collection innovation intelligence ipad iran islam Israel Key intelligence topics KITs lateral thinking leadership leaks LinkedIn management marketing marketing intelligence Microsoft networking news news analysis Other plagiarism privacy product development Sarah Palin scenario planning SCIP search engine search engines searching Security social media statistics strategy terrorism Twitter Wikileaks Wikipedia WolframAlpha yahoo! YaubaBlogroll
- AWARE – Competitive Intelligence for Business Success AWARE’s web-site – lots of options to learn more about CI and MI.
- Julian's The Write Way – How to produce good documentation
- Miriyummy – recipes & stories behind them
Competitive Intelligence Blogs, etc.
Ideas for Marketing and Information
Search Information
Worth a visit...
Latest Tweets…
- RT @AIIP: The world of social media is changing and InfoPros involved in any form of research need to know how to get the best from it. Joi… 20 hours ago
- The latest AWARE Weekly Update! paper.li/awareci?share_… Thanks to @cyb_detective @IngridVasiliu @AricToler #strategy #business 6 days ago
- RT @AIIP: Expand your #AIIP23 conference experience by registering for a #conference #workshop. Our pre- and post-conference #virtual work… 1 week ago
- The latest AWARE Weekly Update! paper.li/awareci?share_… Thanks to @AricToler @kmevangelist @Yaolri #strategy #business 1 week ago
- When researching a new topic there’s no magic bullet. It’s mostly about sheer, dogged persistence. 7 tips from a to… twitter.com/i/web/status/1… 2 weeks ago
- The latest AWARE Weekly Update! paper.li/awareci?share_… Thanks to @Scoundrel666 #strategy #business 2 weeks ago
- one person followed me // automatically checked by fllwrs.com 2 weeks ago
- one person followed me and one person unfollowed me // automatically checked by fllwrs.com 3 weeks ago
- This should be obvious. The reason it isn't is part of the problem we all have. I recently was looking at two comp… twitter.com/i/web/status/1… 3 weeks ago
- The latest AWARE Weekly Update! paper.li/awareci?share_… Thanks to @SomnusScientif1 @RichardEudes @WSaaSHQ #strategy #business 3 weeks ago
Competitive Intelligence News
- 6 Competitive Intelligence Tactics - Advertising Specialty Institute March 23, 20236 Competitive Intelligence Tactics Advertising Specialty Institute
- Boost Sales & Optimize Campaigns With Account-Based Marketing Intelligence - Demand Gen Report March 24, 2023Boost Sales & Optimize Campaigns With Account-Based Marketing Intelligence Demand Gen Report
- DemandLab Reveals 'Insentric' Marketing Intelligence Platform - Demand Gen Report March 21, 2023DemandLab Reveals 'Insentric' Marketing Intelligence Platform Demand Gen Report
- Marketing intelligence platform makes Australian debut at Marketing Live - Prolific North March 21, 2023Marketing intelligence platform makes Australian debut at Marketing Live Prolific North
- Sports Marketing Intelligence Software Market Size and Share ... - Digital Journal March 21, 2023Sports Marketing Intelligence Software Market Size and Share ... Digital Journal
I simply could not leave your website before suggesting
that I extremely enjoyed the standard info an individual supply for
your visitors? Is going to be again ceaselessly in order to check up on new posts