September 11, 2001: A CEO’s Story
On September 11, 2001, Marsh & McLennan Companies had 1,908 people working in or visiting our offices in the twin towers of the World Trade Center. Eight hundred forty-five worked on floors 93 to 100 of One World Trade Center—the floors directly in the path of the first hijacked airliner to hit the buildings. Nine hundred thirty-four worked in the second tower, on floors 48 through 54. One hundred twenty-nine visiting from other offices had meetings scheduled in the buildings. We also had an employee who was a passenger on one of the planes. These are facts I can tell you with certainty; we have lived with them day and night ever since. What I cannot do is convey the grief we felt that day and the loss that stays with us.
As I write this, we are approaching the first anniversary of September 11. We have assisted the families of lost colleagues, relocated employees, recaptured data, and restored business capabilities. We can never completely recover from our human losses. We will always live with the consequences of September 11. But enough time has passed to reflect on the impact of the terrorist attacks on the company and our response to them—how we have mourned our losses, supported the families and one another, and continued to serve our clients.
I had just arrived at my office that morning when a colleague grabbed me and told me to come to the south windows. MMC’s headquarters in midtown Manhattan has an unobstructed view to the tip of lower Manhattan. Everyone else on the floor was already at those windows, looking with horror at smoke rising from a gash in One World Trade Center. As we struggled to make sense of what had happened—Had a small plane hit it? How could that happen on such a clear morning?—we saw a fireball erupt from the second tower. Suddenly we realized that the Trade Center—perhaps the country—was under attack.
I think I was the only person who left the windows. Everyone else was glued to the scene, trying to phone colleagues in the two buildings. I needed to get to my office and start dealing with what this atrocity meant for MMC. Were people getting out of the buildings? Had we lost people? Which facilities were affected? Which clients were affected? What could we do? Where should we start? My phone was out. I had a TV moved in to get news; it remained on for the next week. By ten o’clock, I had gathered a group of managers in a nearby conference room, and we were beginning to figure out what needed to be done.
Veterans of combat talk about the “fog of war” that prevails in conflict; we were facing that same kind of fog. Our communication lines were down, and news from the outside world was confused and contradictory. We had sketchy information that employees of Guy Carpenter, our reinsurance subsidiary headquartered in Tower Two, were evacuating, but we didn’t know who was safe and who wasn’t and whether there would be more attacks. Suddenly, any possible mechanism for getting information had to be considered, and nothing we would normally rely upon was reliable. Meanwhile, our midtown building was filled with people who were shocked, frightened, and desperate for guidance.
With the hope of helping our employees cope with the situation, I got on the emergency public-address system later that morning. Until then, I couldn’t have told you that we had a PA system in our building. But I soon got to know it well. That first message conveyed everything we knew and no speculation beyond that: “As you know, both towers of the World Trade Center have been hit by airplanes. We have employees in both towers.” I went on to inform people that colleagues on the 48th floor of the second tower had been evacuated and that transportation out of Manhattan had been shut down. I promised an update as soon as more information became available.
The group I had pulled together to organize our immediate response was mixed in rank, title, and functional expertise. As would have been the case on any given day, some of our senior people were out of town; the moratorium on air travel meant that some of them wouldn’t be back for days. We worked with those who were here, using our existing disaster-recovery and business-continuity plans when possible and improvising when necessary. Very quickly, we outlined four major areas of concern and assigned people to head task forces on each of them. The first, of course, focused on our people. We had to find out where everyone was and determine what sort of help we could provide. The second was communications. We knew that as soon as our phones and e-mail system came back, we’d be flooded with calls and inquiries. Moreover, many people would need to hear from us. Third, there were numerous operational issues. We needed to be able to serve clients, some of whom would no doubt be severely affected by the attacks. Our World Trade Center facilities had included the headquarters of one division, a data center housing servers for another, and telecommunications equipment. And the fourth concern was the financial effect on our ability to do business.
Our people and their needs were far and away the top priority. Immediately, we made the decision to convert part of the 35th floor of our headquarters, which holds meeting rooms and the company cafeteria, into an emergency communications center. We ran wires into an open space, set up phone banks, and staffed them with volunteers from every part of the company—some 400 of them ultimately—24 hours a day. We gave a phone number to the media so people would know how to reach us to receive or give information about someone at the Trade Center. A group of MMC people went to major hospitals and (when it became operational) the city’s family registration center to get information.
Our communications center was an unbelievable scene. While people made and took calls, messages to lost colleagues began to accumulate on the walls. We heard harrowing stories. One of our employees, a young man, had been on the elevator heading to his office on the 93rd floor. He got off at 90 and made it down. Incredibly, employees who had just been evacuated from Tower Two appeared at headquarters, asking how they could help. There were many tearful reunions.
For my part, when I could get a working phone, I contacted each of our board members to let them know what was going on. We’d had a board meeting scheduled for the following week in Germany, and we decided to move it to New York. Like millions of other people that day, I was concerned about my family’s safety. With transportation down in New York, my wife had set out on foot to retrieve our children from school. They called me, in tears, when they got home. I tried to be reassuring, but it was difficult. I was in a skyscraper, looking out over dozens of trophy buildings bearing the names of America’s largest companies. The TV in my office was reporting evacuations nearby; there were scores of bomb threats in midtown Manhattan during those first days. I certainly paid attention to where the fire exits were, as did everyone around me. None of us knew what might happen next.
By the end of the day on September 11, we still knew frustratingly little about the safety of our people. We had determined that 1,779 people in our various businesses had had offices in the twin towers, and another 129 were visiting there. But we were far from knowing how many had perished. It looked like it could be as many as 700.
Because of the scale of our loss and its unprecedented nature, we knew that we would need outside help. Families of missing colleagues, survivors of the attacks, and other employees would certainly have pressing emotional and other needs. We knew that we had a massive task ahead of us. We arranged for grief counselors to be available at MMC headquarters and elsewhere through the company’s employee assistance program. On Wednesday, September 12, we were in touch with clinical trauma specialists and disaster counseling services that are used mostly by airlines after accidents.
By Wednesday afternoon, we knew that 1,300 of our colleagues were safe. By Friday, the number had crept over 1,400. Every confirmed survivor at that point became cause for celebration—but at the same time, the reality was dawning that no one who had arrived at work that day in Tower One had made it out. Pictures of the missing began to cover the walls. The 35th floor quickly became a living memorial—an ongoing, mass wake. It was hard to be there and harder not to be.
On Friday, September 14, we established a family assistance center at a nearby hotel to provide information, emotional support, and benefits counseling for families of missing colleagues. While the outsiders we hired helped guide our efforts, we felt strongly that our own people should staff the center, provide briefings, and meet with families.
During the week of the attacks, I saw the real strength of our community and culture and observed remarkable qualities in my colleagues. One young woman, for example, in the midst of chaos, took an active part in organizing the call center. She had been with the company for only two weeks, but she saw what needed to be done and kept her composure—that’s just who she is. Fourteen people from the human resources department of Putnam, our Boston-based investment management business, jumped into a van and drove to New York to help out. It was an extraordinary act at a time when simply getting into the city was hard, and many were afraid to be here. Retirees, directors, and many other members of the MMC community volunteered to help in any way they could.
We quickly established a schedule of twice-a-day meetings to hear what was going on and make decisions. We did not restrict attendance to the meetings; people throughout the company knew that if they had information to share or needed a decision, they should be there. The meetings generally didn’t last more than 40 minutes. The range of experience in the room and the openness of the exchanges helped our decision making, which was biased toward action and communication.
I made daily announcements on the emergency PA system for employees at our headquarters. To keep our colleagues around the world informed—MMC employs 58,000 people and operates in 100 countries—those announcements were posted on our Web site. (With the MMC and Marsh intranet servers destroyed in the attacks, the corporate Web site was a medium for communication with both internal and external audiences.) The announcements were also accessible by phone. On Friday, September 14, we gathered the company’s 50 top executives, in person and by phone, to brief them, take questions, and hear suggestions. In our communications that first week, I referred to our progress in addressing our clients’ needs and our financial situation and recovering operations, but overwhelmingly the updates were focused on people. We knew that even in our most distant locations, the foremost concern would be the same as ours in New York: What has become of our colleagues? And what are we doing to help?
After almost a week of extraordinary efforts to find people, we thought we knew the human consequences of the attacks. We also had an assessment of their impact on our business. On Sunday, September 16, I agreed to an interview with a Wall Street Journal reporter and said that we had lost 313 people. As it turned out, I was wrong. A number of our employees had been so shocked by their ordeal that they’d left the city or hadn’t answered their phones. We were joyful when more than a dozen colleagues we had presumed lost showed up for work on Monday, September 17. We now knew that every one of our people in Tower Two had escaped. But we were left with the devastating reality that we had lost 295 members of our corporate family.
Although we had received hundreds of inquiries from the news media, the Wall Street Journal interview was our first (and until now our only) in-depth comment to the media. As much as we were communicating internally, our responses to press inquiries had thus far been limited. We hadn’t wanted to speak publicly until we could provide a comprehensive report. Our priorities were to take care of our people and their families and to make sure our clients were well served. On Monday, September 17, the day the WSJ article appeared, our communications director and her team released a detailed report on our state of affairs to our principal internal and external constituencies—employees, clients, and shareholders. That same day, we published a full-page letter in major newspapers worldwide describing what we knew and what we were doing.
So far, I have concentrated on our efforts to take care of people—and that was our highest priority. Those were circumstances in which people needed visible leadership and the comfort of community. I spent a great deal of time on the 35th floor and at the family assistance center, and I wanted to be surrounded by colleagues. At the same time, the company had other pressing needs.
We had severe challenges to address on the financial and operational fronts. In the short term, we knew we would incur heavy costs. We were in the last month of our third fiscal quarter. Our CFO directed efforts to calculate the attacks’ financial consequences and how they would be reflected in the quarter’s results. An early priority was to make sure that we had adequate cash and that our bank lines of credit were open. The markets were closed in the immediate aftermath of the attacks, but we soon heard they were hoping to reopen on Monday, September 17. How much disruption would they experience? Were we prepared to support our stock if necessary?
Our operations task force had its hands full—especially when we decided that we should aim not simply to repair but to improve what we’d lost in the way of systems, property, and data. All of our companies have extensive disaster recovery plans, but none had anticipated the scale, much less the precise form, of this event. We had lost the headquarters of our reinsurance subsidiary, Guy Carpenter. We had also lost some telecommunications capacity, a data center, and its servers.
In the midst of all this, we were aware of great needs on the part of our clients. Many of them had suffered losses, and virtually all of them were affected directly or indirectly by the terrorist attacks. We knew that Putnam, our investment management business, would have a bumpy road ahead when the markets reopened. Clients of Mercer, our consulting business, had new and deeper needs. But it was Marsh, our risk and insurance services business, that was facing unprecedented demand. And since Marsh had suffered the most devastating loss of people, it had the stress of dealing with client needs as its people were grieving and trying to recover.
Between caring for our people and managing the business, many of us were putting in long days. We lost our sense of time. I wouldn’t think about it until I looked at my watch at some point in the evening and realized I’d started my workday almost 18 hours earlier. I could see profound fatigue in the faces of my colleagues, but it didn’t seem to matter to any of us because of all the things we needed to do.
For me, Friday, September 28, epitomized our efforts to balance our responsibilities to people and to the business. It was the day we held our memorial service, which was attended, in person or by broadcast, by some 25,000 people. Saint Patrick’s Cathedral graciously hosted the service, which included clergy representing a variety of faiths. In addition to those who could be accommodated in the nave, at least 6,000 were watching on a large screen mounted outside the cathedral. We reached employees and friends elsewhere through closed-circuit hookups to theaters in a number of cities. It was a deeply emotional service with readings and reflections by several of my colleagues, including Jack Sinnott, the chairman of Marsh. Mayor Rudolph Giuliani also took time out of his schedule to attend and speak at the service. Expressing my feelings while maintaining my composure was as hard an assignment as I have ever had.
On the same day, MMC announced the formation of a new business. In the global marketplace of insurance sellers and large buyers, Marsh works as an adviser and broker for the buyers. The year had already been a difficult one for clients seeking affordable premiums and satisfactory terms and conditions. As we thought about our clients’ needs post—September 11, it became clear that the new demand for insurance, combined with World Trade Center losses, would create conditions in which underwriters would be unable to provide enough insurance. Consequently, MMC Capital, our private equity business, sponsored and arranged financing for a new insurance provider called Axis Specialty.
It was vital for our employees, as well as our clients and shareholders, to know that we were moving ahead. I wanted to make it clear that, even in mourning, we remained a proud and determined organization responsive to our clients’ needs. The juxtaposition of those events—a deeply emotional response to the human loss and a business response to the changing risk environment—reflects the balance our company has managed every day since September 11.
I wanted to make it clear that, even in mourning, we remained a proud and determined organization responsive to our clients’ needs.
Because of the extraordinary talent and commitment of our people, along with the disaster recovery plans we had in place, MMC’s ability to serve clients rebounded quickly after September 11, and the company has been performing well since then. But families and friends of lost colleagues cannot recover either quickly or completely from such terrible losses.
We have tried to ease the suffering of families of lost colleagues and help attend to some of their longer-term needs. Within a week of September 11, we created the MMC Victims Relief Fund to provide additional support to families for their health, welfare, and education needs. MMC contributed $20 million to the fund; employees, clients, and others donated another $4 million. The fund paid out virtually all the contributions to families in February 2002.
We also established the MMC Family Relationship Management Program, which serves as the primary point of contact between families and the company. Each family has been assigned a relationship manager who helps obtain resources within and outside MMC and who deals with individual benefits and financial, legal, and administrative matters. The relationship managers still have regular contact with families. (See the sidebar “Support for Our Families.”)
In the aftermath of the terrorist attacks on September 11, 2001, victims’ families have faced a variety of immediate needs and longer-term ones. Marsh & McLennan Companies worked quickly to provide a responsive set of benefits and services. They include:
Family Relationship Management Program. A relationship manager has been assigned to each family who lost a loved one in the attacks to serve as its single, primary point of contact. Family relationship managers help people get answers to questions and access to resources, from within MMC and through other public and private sources.
Psychological and Emotional Counseling. MMC employees and their families have access to counseling through the company’s employee assistance program. The company is providing for unlimited counseling to victims’ families through September 2003 and referrals to appropriate longer-term resources.
Enhanced Benefits. MMC provided a special payment equal to each lost colleague’s salary for October through December 2001 and other cash benefits. Families are receiving full health insurance coverage for three years; after that, they will have access to participate in MMC’s plans at their own expense for as long as they wish.
Financial Assistance. MMC contributed $20 million to establish its own Victims Relief Fund for families of lost colleagues, which ultimately attracted an additional $4 million in donations from employees, clients, and others. Contributions were dispersed to families early in 2002.
Financial Counseling. MMC has provided information to families about benefits and financial support available to them and retained an outside specialist company to provide financial counseling through March 2003. Nearly every family has met with a counselor about investment, tax, and related issues.
Family Advocacy. Among other actions, MMC petitioned the U.S. Department of Justice and members of Congress regarding proposed regulations under the September 11 Victim Compensation Fund of 2001. Each family has received an individualized 20-page dossier of work-related information about their loved one to support their application to the fund.
Remembrances. A memorial service for all MMC victims was held at Saint Patrick’s Cathedral and broadcast to employees around the world. MMC hosts an electronic message board for families and friends and a virtual memorial on its corporate Web site. A permanent memorial to the victims is planned for the plaza adjacent to MMC’s headquarters.
I don’t know that I have enough distance from this inconceivable event yet, or that any of us does, to give it the historical perspective it deserves. Clearly, we have learned some things that have affected our decisions since. Although disaster recovery plans and dedicated technology staff helped us restore data, critical applications, and telecommunications capabilities, we now know it is ill-advised to locate a server farm on a high floor of a skyscraper. We’ve learned not to place critical facilities on the same power grid. We’re thinking differently about data center configuration and the separation of IT infrastructure from applications programming. Beyond such operational lessons, there are management and other insights to be gained. I offer these observations.
In a time of crisis, there is something reassuring about hearing the voice of a person in a position of authority, even if the information being provided is scant. I know I felt that way when listening to President Bush and Mayor Giuliani in those early days. It made a difference to people here, too, to have the company’s leadership out there communicating, constantly and informally. I don’t speak only of myself. Many of us were visible. I had help from two past chairmen, outside directors, and retired executives, several of whom immediately arrived to help in whatever way they could. During one of the bomb threats, when panic was spreading quickly through the office, our general counsel made the difference. He didn’t have hard information to share; he simply said that he understood people’s feelings, let them know that he and I had chosen to remain on hand, and told them we would understand and support them if they needed to leave. Nearly everyone stayed; his own composure had the effect of calming others.
I cannot stress enough the importance of having a strong group of internal and external advisers who see things from different perspectives. We were, and still are, dealing with problems we have never faced before, and ideas have surfaced from all parts and levels of the company. No one person could have thought of all the things we’ve done.
In a crisis, culture matters. I’ve related a few stories of individual acts I admired; there were hundreds of them that we saw or heard about later—from the MMC employee who helped a disabled person down the stairs of Tower Two, to the many decisions made on the front lines to assist clients facing unprecedented challenges. A company’s culture—ours stresses the value of people and takes pride in its reputation for service—is a crucial source of strength in a crisis.
I’ve also seen what a crisis can do to a culture. MMC is a multibusiness, global company—one that has made some large mergers in recent years. It’s hard to create a uniform culture in such a company. But this event touched our people no matter which part of the organization or which part of the world they worked in. We all came away from it with a greater sense of belonging to the same community.
It goes without saying that preparedness—good crisis management planning—is essential to being able to manage through a disaster. Our disaster recovery plans did not envision the sort of crisis we suffered or prepare us for it completely, but it very much mattered that we had those plans. We recovered all critical client data, for example, and even Guy Carpenter, whose headquarters was completely destroyed, relocated to our midtown office and other locations and was fully back in business by Monday, September 17.
But you can’t anticipate the precise shape of a disaster. In a moment, the key becomes adaptability. Suddenly, our management priorities were different. We had to do things differently—for example, communicate with unaccustomed frequency and with different mechanisms. My leadership approach had to match the needs of the moment. In a crisis, you understand the need for flexibility in facing all the situations you had not anticipated.
Marsh: Risk and insurance services
Guy Carpenter: Reinsurance services
MMC Capital: Private equity firm
Putnam Investments: Individual and institutional investment management
Mercer Human Resource Consulting: Employee benefits, compensation, communication, and actuarial services
Mercer Management Consulting: Corporate strategy and business design
Mercer Delta Consulting: Organizational transformation
National Ecnomic Research Associates: Economic and financial analysis
Lippincott & Margulies: Brand and identity consulting
For example, a few months after the attacks, it came to light that some victims’ families were dissatisfied with the provision we had made for the continuation of health insurance. Although we considered our insurance extension to be generous, we took the criticism to heart and worked hard to understand the families’ concerns. We came to see their point and amended the program.
Of all the insights I can offer based on our experience, this might seem the most obvious. So many companies acknowledge their people, or at least their intellectual capital, as their greatest strength. But the crucible is a moment like September 11, when we had to make choices fast and instinctively. In the months following that day, our human resource leaders and their teams stayed close to the emerging needs of victims’ families and our employees and made changes to a wide range of services and benefits. Looking back at the crisis and its aftermath, I believe that our immediate and longer-term assistance gave meaning to our commitment to people.
MMC is a company with a 130-year history, and it’s a history I know fairly well. Some of the earliest stories are the most colorful—like the time our founder, Henry Marsh, boarded an ocean liner docked in New York Harbor just to get the ear of a prospective client named J.P. Morgan. He succeeded and, rather than cut short the conversation, stayed aboard while the ship embarked. Marsh had not planned for a voyage and had no luggage with him, but by the end of the trip he had U.S. Steel as a client. We recently celebrated the 100th year of that relationship and, soon after, another centennial with AT&T.
Shortly after I became chief executive, I spent some time working on a strategic review of the business. With a combination of newcomers and veterans among our executives and directors, the review needed to be grounded in a common understanding of our history and the reasons for our success over the years. MMC has grown in scale and complexity, but our long-term success is largely attributable to something very simple: a professional organization of great people. The connection between that and serving our clients with professional excellence is much of what defines us as a firm. In the darkest hour of MMC’s history, I am enormously proud that our people responded to overwhelming loss by simultaneously assisting the families of lost colleagues, comforting survivors, and serving our clients.
Jeffrey W. Greenberg is the chairman of Marsh & McLennan Companies, a global professional services firm headquartered in New York. MMC is the parent company of Marsh, Putnam Investments, and Mercer Consulting Group.
September 11, 2001: A CEO’s Story
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