Greg Smith and Goldman Sachs

Recently, I came across an article by Chris MacDonald that analyzed a resignation letter written by a longtime Goldman Sachs employee, Greg Smith. There were many interesting aspects of this article that pertained to leadership. Greg had worked at Goldman for almost 12 years, and had quite a great amount of success. However, as the years went by, he started seeing a changing culture in his company that he did not approve of. 

Smith was a recruiter and mentor for the company. He put applicants through interviews and helped mentor those hired. He said that he knew it was time for him to go when he “could no longer look students in the eye and tell them what a great place this was to work.” This is quite a bold statement coming from an employee with years of experience and success with one of the most influential investment banks in the world. So what is it about the changes in culture that made him leave? Let’s look in more detail.

When Smith started, he felt he was in a place of teamwork and looking out for clients. The company had many great years and many people coming back to them. However, Greg said that eventually thoughts about leadership changed for the worse. Instead of focusing on clients, the firm was only in it for the profits. He would attend sales meetings where “not one single minute is spent asking questions about how we can help customers.” Also, he said that in a years time, he heard five different directors at the firm use words such as “muppets” to describe their clients. That’s not exactly my definition of a perfect company culture.

Poor leadership again contributed to many problems within Goldman Sachs. Upper level management trained employees to focus on profits, not customers. Good leaders look out for their followers. They help them achieve goals. They listen to their requests. They keep their interests in mind at all times. They absolutely do not ignore them for hopes of only their sole benefit. On the positive side, it was nice to see Greg step up and take leadership. He was making a lot of money and had great success with the company, but it was changing for the worse. He led by showing that the only way to achieve success was by satisfying client needs’ and always keeping their interests in mind. That’s what a company should strive for culture-wise.

I understand this is coming from just one employee in the company. But what he is saying and claiming still needs to be taken into consideration. If these things weren’t going on, why would Greg leave a company that he had great success at? The full letter can be read on the following link from a NY Times article.


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