Ramblings Related to AIG

While I just posted a blog entry yesterday, I couldn't resist doing another given the AIG situation. What troubles me most is that while AIG is getting big stimulus money and doling out the bonuses, one would think that AIG's brand is taking a huge hit ... much more than what the bonus money is worth. It's a PR nightmare spun out of control. If you are like me, you're watching this with disgust. Just think about the companies and individuals that will NOT consider AIG for their insurance, investments or financial planning needs. This will have ill effects for years if not decades. The lifetime value of a customer lost in this case or the hope or ease of new customer acquisition could be eye-popping. I'd also take a wild stab that given the financial condition of AIG, that this PR nightmare does nothing to stabilize the company, but makes it worse. You can't turn your back on $30B but how much will AIG lose as a result of this.

According to the Associated Press, AIG rewarded more than 70 employees with more than a million dollars in bonuses, saying it needed to do so to retain key employees. Eleven are no longer with the company but will receive their bonuses.

Message to education: Protect the brand. Have a plan. Don't invest in program development that you can't sustain long-term. Fulfillment and customer service are part of brand management. Hire good people. Retain and train them. Hold them, as well as yourself, to accountability and performance metrics. Don't reward bad behavior ... especially with a million bucks. :)