The rise and fall of Lehman Brothers is a human story, not a financial one

The most surprising aspect of the Sam Mendes directed “The Lehman Trilogy” marathon three-and-a-half hour production at London’s National Theatre is neither that it sold out instantly, nor that it is a triumph of theatrical production. No, the most unanticipated insight you emerge with is how the chronicling of the rise and fall of Lehman Brothers is a human story, not a financial one. When the young Henry Lehman stood on a New York dockside on a cold September morning fresh from Bavaria in 1844 he was dreaming of a new life in a new world, not the biggest economic collapse of any financial institution in history. Back then the young Henry wasn’t even a banker – he and his two brothers that followed began by opening a small store selling cloth in Montgomery, Alabama.

The illustration for the epic play connecting 1844 to 2008 – a black-and-white still of a Russian tightrope walker walking between two unspecified buildings on Wall Street – is an anchor metaphor. Business is at all times a high-wire act, but underlying its labyrinth of duck-and-weave complexity is the perpetual ongoing tension between people and profit.

The client accompanying me at the performance is the UK chair of a sprawling multi-national whose over-ambitious acquisitive strategy a few years ago had disintegrated into multi-million pound losses thereafter. Her appointment to mop up the mess led to inevitable closures and redundancies. Her task was to oversee and regenerate.

The business arc of the Lehman story migrated from retail to wholesale to banking to trading and investing. Balanced against it is the human tale that is best illustrated by the erosion over time of the Jewish pieties. When the family first sit “Shiva” at the death of a relative they mourn for a week; the second time they sit for 3 days. Finally, the bank is closed for 3 minutes. Until – when the family loses control - Lehman doesn’t mourn at all. By the time Lehman passed into the hands of Pete Peterson and Lewis Glucksman, finance had become absurdly speculative and people barely registered as a footnote in the homage to profit. 

Another interpretation of the tightrope image is a remark from the play by a Lehman wag that “every day on Wall Street men walk on air”. Dramatic as it may seem, the tightrope walker mysteriously fell from the wire during the time of the 1929 stock market crash. To quote Howard Jacobson “Bankers dream like other men, the only difference being that when their dreams turn to nightmares, we all lose sleep.”

Many business leaders, duped by their success, buy into the hubris and believe they can walk on air. It can lead to mindless acquisition sprees that ignore the risks and eschews the collateral human cost. 

My chairman client recently addressed an invited representative audience of 170 staff and announced: “we are rebuilding this company and, on my watch, this is all about people”. The business is construction. She is, at this point, two years into a “re-culture” to accompany her re-structure.

Leaders set the tone in every business. What they permit and what they promote, consciously and unconsciously, trickles down through every micro-policy and mini-decision that company and its managers make. They walk the tightrope and balance between people and profit every day. Often they don’t even know it.