Goldman Sachs Reputation Crisis: Success Is More About Profitability.

Long term greed.

A Goldman partner used this phrase to explain why Goldman Sachs succeeded.

But in recent years, this "success" is more reflected in the ability to earn profits.

After the financial crisis, Goldman Sachs suffered a lot of reputation and sustained a public relations crisis.

This is not only a public relations crisis facing former president Clinton's press officer Siewert, but also a disaster for Bbe Fank Van. Many people speculate that he may be forced to resign.

The more damaging effect is that if Goldman's customers know about Goldman Sachs because of this open letter,

A spokesman for Goldman Sachs responded to this newspaper, "we do not agree with the New York Times's open letter."

Customer first? Kill customers?

Goldman Sachs has always followed its 14 business rules: customer first, team spirit, pursuit of excellence and honesty.

Every new recruit

12 years ago, when Smith joined Goldman Sachs, he was instruct to "understand the motives of customers and investment, understand how they define success and how we can make them succeed."

Smith said that the most frequently asked analysts at Goldman Sachs frequently asked him, "how much money do we earn from this client?" Smith believes that this reflects the way they manage to learn from management.

He wrote, "the Goldman Sachs are disgust when they discuss how to kill customers.

In the past 12 months, I have seen 5 directors who call their customers "doll" (Bai Chi), sometimes in internal mail.

Many management practices have made Smith feel that the original culture of Goldman Sachs has ceased to exist. He gave an example in an open letter.

"At the conference on derivatives sales, I did not spend even a minute to discuss how to help customers, but only on how we could earn the most profits from our customers.

If you are an alien from Mars and take part in one of the meetings, you will feel that the success and progress of the customer is not the topic of the conference at all.

Bbe Fank Van and Cohen said they were very disappointed with Smith's remarks. "It can't reflect our values and culture, nor can it reflect the company of most Goldman Sachs and the work we do for our clients."

"It's not surprising that there are people who are dissatisfied with the status quo in our company of this size.

But it can't and should not represent the idea of more than 30 thousand employees in the company.

Smith, an executive director who just left Goldman Sachs, told the reporter that he was shocked by his open letter, but he basically agreed with his view. "Many people have seen problems, but few have spoken publicly."

Banker culture and trader culture

Once, Goldman's culture was

Bankers may spend a few years cultivating corporate clients, hoping to give advice to one of their major mergers and acquisitions one day.

But now they are under increasing pressure to make more money from their customers.

Since the launch of Goldman Sachs in 1999, the share of traditional financing, mergers and acquisitions and consulting services has been declining, while trading related businesses account for more than half of Goldman's total revenue.

In Goldman Sachs, the two camps of bankers and traders have been fighting for profits and power.

In 2006, the merchant trader was born as a CEO and chairman of Goldman Sachs, and the trading camp was firmly in control of power.

At present, Goldman's core executives mainly come from the trading department, and President Cohen and asset management department and human resources department executives also come from Goldman Sachs commodity department.

Goldman Sachs reported that Goldman Sachs began to introduce a banker's scorecard system after being appointed by CEO, and listed the daily profits and losses of each employee to evaluate the performance of the employees in.

This method of assessment has always been despised by Goldman before the development of Blankfein, but it is more common in other the Wall Street firm.

From this point of view, Goldman Sachs, under the leadership of Mr Blankfein, may become more focused on short-term interests than other Wall Street banks, rather than long-term gains.

Many people also call this trading oriented company the largest hedge fund in the world.

They no longer regard customers as customers, but think they are "counterparties".

Smith shouted at the end of the open letter, "to clear out the doors of Goldman Sachs", "let those who only care about making money can't stand in this investment bank".

"I hope my departure will awaken the board of directors of Goldman Sachs and refocus customers on your business.

Without customers, you can't earn a cent.

In fact, without customers, Goldman Sachs will not exist. "