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Express service Henry Wells and his two closest competitors combined delivery services in 1850 and founded American Express. Later in the century, American Express expanded into financial services by offering money orders (1882) and the world's first traveler's checks (1891). The company introduced its famous charge card, which places no credit limits on consumers and requires them to pay off the balance each month, in 1958. The charge card was unprofitable at first, but by the late 1960s American Express boasted more than 2 million cardholders and a total charge volume of $1.1 billion. Optimum credit Unfortunately, too many customers have been leaving home without their Amex cards during the last ten years. A decade ago, 25 percent of all charges were made with an American Express card; that figure has now fallen to 17 percent. The company has stemmed the tide by reinvigorating Optima, a credit card that it introduced in the 1980s to compete with Visa and MasterCard and by introducing co-branded cards bearing the logos of sports teams like the New York Knicks or corporations like Delta Airlines. The charge cards are part of the company's Travel Related Services division, which also oversees the traveler's checks, a travel agency, and several travel magazines. The other major division, American Express Financial Advisors, sells life insurance, investment funds, and financial advice. American Express spun off its Lehman Brothers investment banking unit in 1994. Orient and occident The recent economic turmoil in Asia has taken its toll on American Express' banking division, which has extensive holdings in Hong Kong and Indonesia. In 1998, the company reported a $83 million quaterly loss while nonpeforming loans tripled from a year ago to $149 million. As a result, the company enacted a $138 million provision to boost its bank reserves in an attempt to offset any future losses icaused by the Asian economic crisis. The action dampened what has been a healthy first quarter, with American Express? core charge card and money management business earning record profits.
American Express has traditionally hired few recent college graduates for its marketing positions, but an insider tells us that "this year, there's been an increasing push to have more entry-level people hired as analysts and assistants to the marketing managers." American Express always has positions open in its Financial Advisory services (essentially a brokerage arm); insiders say that "Golub is looking to grow Financial Advisors like crazy, and Financial Direct could take off too." MBAs are sought for marketing manager positions and strategic planning group consultants. For college graduates applying for analyst positions and MBAs applying for one of the managerial slots, American Express uses a behavioral interviewing method, sometimes (though apparently rarely) interspersed with specific industry questions and marketing "cases." These cases are normally questions that relate to some aspect of American Express' recent business. (Cases are, for obvious reasons, most common in American Express's consulting unit, the Strategic Planning Group.) Those applying for positions as Financial Advisors will have interviewers inquire about their business and customer service expertise. "The interview process is not too strenuous," says one recent hire. "It goes two rounds, and basically the company wants to make sure that you will be a good fit with the company, there are a lot of behavioral questions." One summer intern reports having only "one interview at Amex, and it was very short. The interview process didn't seem that rigid. I am under the impression that American Express does a lot of prescreening, and the interview itself is just to ensure you behave normally and don't smell or anything."
One fish, two fish In some senses, American Express is much like any other gigantic corporation. Employees admit that "the cartoon Dilbert rings true here." One insider's main gripe is that "American Express is such a huge company that there are a lot of office politics and no real sense of belonging or individualism. It's really an issue of being a small fish in a very big pond. But those are issues you would have with any large company." Bona fide Promotion opportunities are reportedly mixed: Though half of all openings are filled internally, "I have seen many people come from outside the company to take on major responsibilities," says one insider. And insiders say bureaucracy is rampant at American Express. We are told that "there are many levels of approval to get anything done." One employee gives Amex credit for trying to change, saying that "the company is extremely concerned with self-improvement, and has asked me several times how the employment process could be improved. Another Amexer credits his firm as "a great company that is trying to evolve from a sales institution to a bona fide financial planning firm," but says "the problem is that there are too many overpaid management levels." One marketing manager criticizes American Express' tendency to hire few college graduates for its marketing positions. "Basically, - said the manager, - you had MBAs doing work that college grads could easily do." No complaints here American Express tries to ensure that its employees are fairly compensated. Insiders tell Vault Reports that "pay is competitive with the industry and is kept that way through constant survey. I have never had a complaint." However, in units such as the Strategic Planning Group and for marketing manager positions, "American Express is not as competitive as investment banks and consulting firms as far as attracting top talent, because we simply don't pay as much. We might offer a recent MBA $75,000, whereas they might get an offer for $130,000 from Bain or something." Says a summer MBA intern who was unsure about whether to return to Amex: "If yes, because it's a company that really tries to be fair to employees. If no, it's because for New York, the pay is low." Contacts tell Vault Reports that the company offers "an excellent benefit package." "After one year you can contribute to the 401(k) plan -- the company matches up to three percent of your contributions and throws in a 1 percent 'gift'," insiders tell Vault Reports. There is also "a profit sharing plan," which is based on overall company performance and can be up to 7 percent of base pay.Amex hours are on the "light side" for a financial services company, according to insiders, and the company also offers flexible scheduling, compacted hours, telecommuting and job sharing options. Not for the crunchy One MBA employee says: "Sometimes I would bring my laptop and work from home on weekends, but it was rare that I actually had to be in the office." If you work at Amex's World Financial Center headquarters, you can leave your Birkenstocks at home. "New York is, by and large, not casual. Other offices vary by times of year and days of the week," and "business casual is often the norm," employees tell us. The company appears to be doing fine when it comes to diversity issues. Employees say that minority recruiting is very proactive, and that American Express has "a large number of women and minorities in upper management positions. The most likely candidate for our next CEO is an African American [COO Kenneth Chenault]." "I would say that over 50 percent of marketing managers are female," says one former employee. Another employee puts the figure at close to 65 percent women. Two women and two African-American men, including Vernon Jordan (yes, that Vernon Jordan) sit on the company's board of directors. The company also introduced Diversity Learning Labs to instruct employees on minority financial planning needs.
Ursula F. Fairbairn Attn: Amex Website Human Resources 200 Vesey Street1 New York NY 10285-0203
Credit cards;Annuities;Investment funds;Financial advisory services;Magazines; Life insurance;
MasterCard;Morgan Stanley Dean Witter (Discover);Visa More Company Profiles For more career information, go to Vault.com ©2000, Vault.com Inc
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