In the Sub-Prime Fiasco What Happened to the REAL Customers?

Honest disagreement

One of the things that I really enjoy as a commentator on business is the opportunity that it provides to listen carefully to an obviously clever and successful individual and then, hopefully with a degree of surgical precision, destroy every argument that they have put forward.

I have long enjoyed that attitude toward John Moulton the founder of Alchemy. I listen, I respect and then - generally - I reject. All good clean fun and challenging exercise for my aging brain.

It came as something of a shock, therefore to find that when Mr. Moulton was featured on the radio recently I listened with diligence, considered his arguments and, to my mild dismay I found that I agreed with every word that he said.

Lehman et al

John Moulton was commenting on the greed and hubris that had been exercised without restraint and from which we will all suffer - except for those that perpetrated the acts of idiocy, mendacity and wild, unbridled avarice.

He was making the point that the criminals of the finance sector were not merely still enjoying their "ill gottens". The criminals were running the prisons. Worse, having, by any standards demonstrated that their claimed abilities were at best questionable, they, of all people are now holding forth as if they are the ideal authorities to resolve the problems that they have caused.

To one of my age it is a reminder of the dot com debacle when similarly greedy and supposedly clever individuals threw investors' money a few million at a time down the nearest drain or, more vulgarly, up against a wall and then joined the conference circuit to hold forth as experts on how to avoid future woes. How did they have the gall to pretend to tell others how to avoid being a sucker.

Impressive or what?

Among the architects of the financial sector's miseries there are a few that with all the sincerity of an atheist reciting the general confession state firmly and with courage, "I take full responsibility!"

How brave, how touching, but they are still in a job. What is worse, they clearly have every intention of continuing to draw their excessive earnings for years as they apparently wait idly by, Micawber-like, for "something to turn up". "There is no short term solution to the pain" they say; give no indication of having a strategy - much less tactics - to mitigate the mess and while they avoid action, they are happy to talk - and talk - and....

If asked what sanctions result from their assumption of "full responsibility" they reply with a degree of cockney impertinence that Ruskin would have found infinitely more irritating than that he ascribed to Whistler, that there is no relationship between acts and consequences when one reaches their exalted position.

The rest of us do not pass "Go", we find that to collect £200 or any other sum is becoming, for most people virtually impossible. The wickedness of it is that the top executives seem to survive whilst those who have put their trust in them see their investments, large or small, disappear.

Lex in the Financial Times fulminates against grotesquely overpaid Chief Executives whose only claim to fame is that they collect their largesse as they destroy stockholder value - with it seems, little practical effect.

Mr. Moulton, I salute you - just this once I hope - old habits are hard to break.

The missing ingredient

In the midst of all the brouhaha there is a key missing ingredient, one that I am certain the astute reader such as yourself, will have spotted. We have Top Level execs hired at great cost, paid fabulous sums and "earning" even greater bonuses for making short term profits and surrounding themselves with "golden goodbyes". We have traders earning vast sums gambling short term with long term deposits and raking off a decent percentage for themselves (under Top Level Execs guidance). And we have the short term investors caring for nothing but instant growth and dividends, yet keen to cry 'foul' when "the value of an investment may fall as well as rise".

So where, in the midst of this, is the humble customer? For without those customers having the confidence to lend the banks their hard earned cash, then those who gamble with the bank's long term future on those leveraged deposits, have no toys to play with. The banking system depends long term on that trust which is hard earned and easily lost.

This is a clear example of the lack of "joined up thinking" in the banking sector that so easily destroys that trust. To quote David Butler, who should know as he has served on the Investment Committee of the United Bank of Kuwait, and whose summaries are always so eloquent:

They think they know what the bank's top team strategy is: (plan approved by the Board)

They think they know what the managers and staff are doing: (HR director's reports)

They think they know what the customers think: (x million dollars per annum on market research data)

BUT they never think of relating each of these factors to the other two.

Duh....

Mr. Moulton, (and even perhaps Homer Simpson whose intellectual capacity competes favourably with some overpaid executives it seems), - you may have more in common than you think. Should you be talking? Of course my one track mind suggests that the subject matter should be Customer Engagement....but then it usually does.

Article Source: http://www.articlegoldmine.com

Prof Tom Lambert author, international consultant and avid researcher is Chairman of TripleIC, the only company authorised to use the Lambert Protocol. It measures your Customer Engagement (the vital key to sustained success) Come and meet the team at www.tripleic.com

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