HOUSE OF CARDS: Inside the Troubled Empire of American Express by Jon & John Meehan Friedman

HOUSE OF CARDS: Inside the Troubled Empire of American Express

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An unsparing and gossipy audit of James D. Robinson III's bumbling stewardship at American Express. Drawing on a wealth of inside sources, Friedman (a Business Week alumnus) and Meehan (that magazine's money-and-banking editor) make a strong case against the courtly scion of an Atlanta banking family who took command of AmEx at age 41 in 1977. During the early years of his tenure, they recount, the image-conscious CEO suffered a humiliating defeat at the hands of McGraw-Hill, which vigorously repulsed his unwelcome takeover bid. Robinson subsequently redeemed himself with the 1981 acquisition of a ranking securities firm (Shearson), adding a fourth dimension to AmEx's banking, insurance, and travel-related activities. But while the good times rolled, allowing the papering over of some egregious blunders, latent troubles began to surface. Cooked books precipitated a surprise crisis at Fireman's Fund, for instance, and the brokerage units began losing big money in the wake of the 1987 market break. More recently, AmEx has been obliged to apologize publicly for a smear campaign against an erstwhile director, and the flagship credit/charge-card operation has reported huge losses. Owing to intense competition, moreover, the fabled Travelers Cheque is no longer the cash cow of yesteryear. Nor has Robinson been able to staunch a hemorrhage of executive talent. As the authors make clear, the onetime boy wonder is essentially a consensus-building overseer, not an innovative manager, let alone a visionary leader. In consequence, they conclude, AmEx's serious disarray puts its apparently self-absorbed boss at considerable risk. While their prose style can most charitably be described as serviceable journalese, the authors offer a damning, dirt-dishing bill of particulars on a corporate chieftain arguably not up to the task of running his own show.

Pub Date: March 30th, 1992
Page count: 272pp
Publisher: Putnam