06 OctAnglos vs. Swiss, a perennial culture clash?

In any competition between an Anglo and a Swiss, the Anglo will win more often than not. Ok, this is a generalisation. But it holds true often enough in banking, though not at football, as the team there just followed on from earlier defeats of Man Utd. and Chelsea by beating Liverpool. Inspiration for this week’s post comes from recent reports of rumblings at CS and Julius Baer.

At Baer it seems that many of the Merrill Lynch crowd, brought in when Baer bought Merrill’s non-US private banking business, have done well, whilst many old time Swiss Baer staff have lost out both in terms of position and in terms of having any job at all. At CS, there is apparently some jostling for position in case time is called on Brady Dougan’s tenure in Paradeplatz. No real surprise, but what gave me pause for thought were a couple of sentences at the end of a recent article on “Inside Paradeplatz”. The gossip and speculation in that article do not merit any further airtime, however the author made one very telling point about culture at the end of the article. Commenting on the skills that seem to attract attention and promotion chez CS:

“Nicht Erfahrung und Leistungsausweis würden belohnt, sondern glänzendes Reden und Auftreten. Keine Schweizer Spezialität.”

“Neither experience or a track record of performance is honoured. Rather it is about polished speaking and appearances. Not a Swiss speciality.”

Many years back, in days at Goldman Sachs, an American member of the team running the firm’s Trust Company, the pre cursor of what became Prime Brokerage told me: “Olaf, you always sell more than you can deliver.” The Swiss it seems will often sell less than they can deliver. Standing up and pitching themselves and their topic is simply not a Swiss virtue. Standing out and being more equal than others is something they strive to award; there is no formal Swiss president. Rather one of the seven federal ministers (the Bundesrat) acts as president for a year at a time. Nobody has the chance to be too powerful, but then neither can they build lasting relationships.

Lessons to be Learned:  Of course, the comment above is a quite a generalisation, but then when I share the observation with friends they laugh at its aptness, certainly in relation to the banking world. Even a very senior headhunter I was talking to recently agreed with the observation.

Now what I cannot account for is how successful major Swiss companies have been at running global organisations; Nestle, Roche, Novartis, Swatch, Swiss Re, Zurich Insurance, Rolex. All do well at running global businesses that are headquartered in Switzerland.

Perhaps those non-banking companies are more international and have evolved their management models and culture over a longer period. Perhaps the “battle lines” are not quite so polar; in banking it is the Swiss in Switzerland vs. London and New York. That same stark divide may not exist at Nestle.

Not clear and I’d welcome others’ thoughts.

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