The recent legal scandal involving four insurance companies in the U.S. caused them to lose $4 Billion of shareholder value in 2 days and now one chief executive. Having worked in one of those companies, and for others who are similar, I’d say a deep, underlying cause is a severe lack of empathic concern for the customer. There are many levels of hierarchy and bureaucracy between workers and customers than breeds insensitivity, and eventually greed.
Those of us who care about helping companies improve their products and organizations should absorb this lesson and teach it as a morality tale. Bad companies get punished, not just by the law but also by the stock market. In the longer run sales will suffer as wary customers punish them by taking business elsewhere.
Being customer-centered leads to better products and to better companies.
Update: And Marsh has to lay off 3,000 people as a result. Very sad.
Another Update: And several Marsh board members are losing their seats.