Thursday, December 4, 2008

Hard-Luck Lessons

If your career path has been tangled in the subprime-mortgage mess and resulting financial meltdown, cheer up. You're probably learning some valuable lessons about failure and cleanup -- and won't be stigmatized by your organization's bailout or bust.

That's the view of an Indiana University business professor who studied the careers of hundreds of bankers derailed in the Texas bank failures of the 1980s. The "innocent bystanders" who had no hand in causing the problems "did not get painted with the same broad brush as those who were responsible for their banks' failures," Matthew Semadeni said. They did not end up with worse career consequences than managers of unscarred banks.

The best career route is to escape early: Bank executives who left months before a crash in Texas slipped past the "stigma" of a major failure. But Semadeni noted that it's too late for that in the current crisis. His advice to those working at Fannie Mae or Washington Mutual: "Stay put now and manage it as best they can."

They'll be like pilots who have already gone through a crash landing. "There is something to be said for that experience."

-- Vickie Elmer