Lehman Brothers president and chief operating officer Joe Gregory encouraged students to infuse new life into the finance industry by breaking rules and challenging the status quo, in a lecture yesterday in Dodds Auditorium.
Lehman needs rule-breakers, he explained. While rules and polices are important, they only work 95 percent of the time. "It's our company," Gregory said. "We can make [the rules] and change them when it's obvious."
"You have to be bright enough to disagree," he said in the Business Today-sponsored lecture. "You need to be willing to debate and not fall prey to the politics of 'Yes, sir.'"
Gregory, a graduate of Hofstra University, started at Lehman Brothers in 1974 and has been there since, moving from various positions in the fixed income division to chief analytics officer to president.
Gregory spent a part of the lecture describing what happened to the firm after Sept. 11. 2001.
The Lehman offices, which were located on the 38th, 39th and 40th floors of one of the towers, were destroyed, but only one member of the firm was lost in the destruction. The group, after escaping from the building, took a ferry across the river and into New Jersey to settle in Jersey City on 101 Hudson St.
"It was an incredibly overwhelming thing. It leaves a different mark on your psyche," Gregory said.
"We lost 2,700 direct lines to our investors. Our brand new equity trading floor that opened on Monday was gone in one day," he said. "[As a company] you lost your capacity to operate. Why would [investors] not execute with a company who had what we lost?"
Describing the efforts of the employees to rebuild Lehman in the aftermath, Gregory said, "We were a flat organization. It was a great corps of people who are rule-breakers."
On the Friday after 9/11, the employees were commended for their hard work and asked to go home. On Sunday, however, Gregory admitted that he was itching to go back to the office and drove from his home in Huntington, Long Island, to Jersey City. When he reached the office, he found employees still working in the office doing what they could do.
"I was blown away," Gregory said.
In the months following 9/11, "everyone" predicted that Lehman would eventually fade away into history, he said. But, Gregory added to laughter, "You fight your way out of a corner. Do you know who 'everyone' is? I want to meet 'everyone.' "
"It's easy to be cynical. You all have a mind for problem solving. You have to believe the problem can be solved. You have to believe it's possible. What 'everyone' says is mostly wrong."
Gregory explained that he had a larger vision for Lehman. While the firm is still worth only half of the gross revenue of a division at Morgan Stanley, "We're not staying there." Encouraging the members of the audience to join Lehman and change the industry, Gregory asked, "Do you want to participate and change? We have that opportunity. It's going to be your culture."
Young professionals need to change the standard model, he said. "Make change by respectful debate. Why would you want to get in line and do what everyone else does?"
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