Companies take note: in the social media age, your dirty laundry is fast becoming everyone's business.
First Greg Smith of Goldman Sachs, now ex-Google's James Whittaker is sharing his reasons for leaving, reaching a global audience fast. In each case they are offering us a window into cultural issues and actions taken from false logic that should serve as a warning to the companies.
Unfortunately, it is too late for Goldman to avoid the current meltdown. Clients have voted with their feet and the loses are mounting—US $2.15 billion wiped off market value resulting from a 3.4% drop in share price. This may turn out to be an clear illustration of how false logic can lead to dysfunction, corruption and eventually bankruptcy in the moral, cognitive and legal sense.
A recent New York Times interview with another former Goldman employee, Jacki Zehner, reveals how the structures in the overall financial industry have helped promote cultures that reward profit over customer service. While it comes as no surprise, this highlights the power of culture within organisations and industries in driving thinking and behaviours. When enough people share a world view, it becomes accepted as truth.
Goldman's loss of credibility—so crucial in any market, but especially in the financial services sector—is at this stage so public and great, that we may be watching the end of an era. Google's issue is more internal at this stage, but it highlights how crucial it is for a company to protect its soul.
What can they do?
Find trusted and skilled straight-talking strategists outside the corporate and industry culture who can enable them to challenge the truth of the current situation and devise a future-driven strategy based on long-term thinking.
Even if these claims are merely a disgruntled ex-employee, there has to be some seed of truth. Regard it as an opportunity to question the current thinking and actions. Then put structures in place to keep challenging thinking and ensure they never again go down that slippery slope.