The very best public relations counsel in the world can't fix a broken product or service. That's why, in light of yesterday's brutal Greg Smith essay in The New York Times, Goldman Sachs would be better advised to spend its money on smarter initiatives.
Instead of following a typical PR firm's advice of running full-page letters of explanation in The Wall Street Journal signed by CEO Lloyd C. Blankfein, placing bylined articles carrying president's Gary Cohn's signature in the business and financial press and getting both on the CNBC, Fox Business Report circuit, Goldman should first shore up what I call its audience experience.
The top brass should spend time walking in the shoes of the institutional investors Smith says were known as “muppets” within the firm. They need to sit alongside employees at all levels and experience the culture Smith termed “toxic and destructive.”
In short, the old, white guys in the corner office need to abandon the typical strategy of simultaneously undermining Smith's credibility while blitzing the media with 'look at how great we really are' stories. The first approach will reek of vindictiveness. The second will have about as much credibility as BP's continuing to insist the Gulf Shore is better than ever.
Toxic cultures and patronizing customer service occurs when senior leadership puts profits before people. But, there are two, sure fire ways to turn both around (and neither involves PR): The board should either a.) fire Blankfein and Cohn, or b.) read both the riot act and insists they spend the next six months experiencing their brand personally and from the outside in.
I'd opt for the latter and get Butch & Sundance going on a different kind of tour. I'd have them sit right alongside their key institutional investors and listen as a Goldman adviser tries to push 'Hung Elephants' as Smith called the firm's practice of selling only the highest profit products. I'd have B&S join another investor and experience, first-hand, what it feels like to be pushed to invest in 'axes', the products Goldman is trying to dump because they aren't very profitable.
Last, but not least, I'd partner with a firm that could attend internal meetings as B&S's proxies to see if muppet mania really does pervade the culture and clients are, in fact, seen solely as cash cows and not valuable partners.
Until, and unless, Blankfein and Cohn experience the Goldman brand from the outside in, any PR program will be seen as glib and superficial. But, if they can report in six or 12 months time that they personally walked in their customer's shoes, sat in employees' seats and made concrete corrections based on first-hand knowledge, they can begin the long and arduous process of rebuilding trust in the brand. If they don't, Goldman will be forever tarnished as the Glengarry Glen Ross of Wall Street.