Outcomes

In the ethics & compliance world, many professionals struggle to measure the effectiveness of their program.

We pick a few easily measurable metrics, such as the number of allegations made, and are quickly puzzled. What does it mean when that number goes up or down?

The more experienced professionals realize that input metrics are rarely helpful to measure effectiveness. They do offer an opportunity to ask good questions but they seldom provide an answer.

Output metrics are more telling. Let’s say we typically get 100 potential conflict of interest disclosures during our annual survey. This year, for the first time, we hold five lunch-and-learn sessions (input) the week before the survey to explain the different types of conflicts and why it’s important to disclose them. If our disclosures double (output), then we can probably say that our training campaign was effective.

But is this the business we are in? Is our role to generate allegations and disclosures and training completions?

Of course not.

Our role is to drive behaviors that are consistent with our organization’s values. Generally, the outcome we seek is an organization that generates trust, treats everyone with respect, and performs with integrity.

And so an effective program is one that generates the right outcomes. The relevant metrics tend to be more qualitative than quantitative – and thus harder to measure. The good news is that there are competent professionals out there who can measure these outcomes.

It’s the only way to truly measure the effectiveness of our E&C programs.

Hat tip to Todd Zipper

The adjacent possible

I am spending the next three days in Washington, D.C. for the annual conference of the Ethics & Compliance Initiative.

In the midst of countless plenary and breakout sessions, here is what I hope to accomplish, in increasing order of priority:

Network with colleagues
Learn something new
Learn to think differently

And you can hardly get to the third bullet without the first two.

That is how most people innovate, even E&C professionals. We start with our current body of knowledge, we bump into someone who adds a new learning, and our brain makes a new connection.

It all happens on its own – if we show up.

To learn more about innovation and the adjacent possible, read Where good ideas come from, by Steven Johnson.

Kaizen and ethical leadership

In my organization, we use the concept of kaizen, a Japanese word describing continuous improvement.

In one of its simplest forms, kaizen calls for the practitioner to do something for one minute every day at the same time. By breaking down a task to something that can be done in one minute, we eliminate all excuses not to tackle that task. By doing it at the same time, we create a habit. By doing it every day, we accomplish great things over weeks, months, and years.

This idea can be applied to creating a painting, reading a book, writing a book, learning a language, getting better at a videogame, and getting in shape.

Of course, it can also be applied to becoming an ethical leader.

The O’Reilly equation

Mr. O’Reilly was not terminated after the first allegation of sexual harassment surfaced years ago.

He was not terminated after the second, or third, or fourth, or fifth allegation of abusive behavior were made to his employer in the following years.

He was not terminated for generating $13M in payouts to settle these allegations.

So one can reasonably assume that he would not have been terminated when all these allegations were made public.

But then, 50 advertisers pulled their money away from Fox News.

Suddenly, Mr. O’Reilly’s $18M/year salary became less attractive.

And so he was finally let go.

That’s what it’s all about.

Adaptive performance review

Yesterday I conducted a performance review with two of my direct reports.

It was our first time going through a new quarterly process. Our organization has moved away from the traditional annual review.

I took this opportunity to insert new elements in the discussion. Rather than focusing exclusively on outcomes (i.e. did you meet your goals?), I injected a number of inputs to measure their level of play, purpose, and potential:

How are you doing?
Are you enjoying the work that you do?
Do you have everything you need to do your job?
Do you think we are working on the right things?
Should we try something new?
Should we change how we do what we do?
Do you need more visibility on the impact your work has on the end-customer?
Where would you like to be next year or three years from now? Would it be with this organization or another one? Is is the work that you do today getting you closer that?
What can I answer for you?
How can I help?

This list certainly feels like I work for them, and not the other way around.

That’s right.

Whistleblower thank-you speech

In light of the investigation of Barclay’s CEO by the British authorities, here is a sample speech that executives can use after receiving an allegation from an anonymous whistleblower:

“We recently received an anonymous allegation of wrongdoing by the company [include details as necessary].

First, I would like to thank the person who had the courage to bring this to our attention. We can’t address the risk we don’t see. Every employee is encouraged to speak up when they see something wrong. In doing so, you are protecting the company from further and greater harm.

Second, I want to assure you that when you protect us so, we will protect you. We will not tolerate retaliation of any kind against anyone who reports an actual or suspected wrongdoing in good faith.

Finally, please note that I instructed everyone involved in the investigation to refrain from any inquiry attempting to uncover the identity of our source. It simply does not matter who raised this issue. Trying to find out who they are can only break the trust we have with them – and with all future sources. That’s a risk we do not want to take.

We are committed to finding the truth about what happened. Only the truth will give us a shot at improving how we do things.

Thank you.”

The risks we don’t see

About one third of employees observe misconduct in the workplace.

Some will confront the offender directly. Some will report the misconduct to management.

Others won’t report it at all. And that last category is larger in organizations without a confidential and informal reporting channel, usually staffed with one or more organizational ombudsmen.

An ombudsman program allows employees to raise concerns in an informal way. The organization is not put on notice of the wrongdoing without the permission of the employee. For many employees, this is the safe harbor they need to talk things through, to understand their options, to decide if it is safe to formally report the wrongdoing.

From the organization’s perspective, an ombudsman program provides psychological air to employees and sheds light in the dark corners.

We can’t address the risks we don’t see.

For more, check out the International Ombudsman Association‘s website.

Is there a human being behind this policy?

The essence of a service industry is the point of contact with the customer. From a yoga class or therapist to a decorator, a restaurant or a tour operator, we expect value to lie in the personal nature of the delivery. It lies not in product quality but in experience quality – in courtesy, humanity and kindness. We do not expect a difference between a first- and a second-class experience, between caring and not caring.

This quote is from a very good article I read this morning on the effects of targets on corporate culture.

And it got me thinking about the work that we do as Ethics & Compliance Officers.

Granted, we are not exactly in the service industry. But after our employees run into a problem related to our online training, our policies, or our controls, they come to us for help. They come to a person. They expect a human being.

(Just like passengers do on an overbooked aircraft)

And so we must remember: How we do things matters just as much as what we do.

Bad apple or bad culture?

A low-level employee

Opens fake bank accounts
Forcibly removes and injures an airline passenger
Installs a cheating device in a car
Pays a bribe to a hospital administrator
Disregards sexual harassment from a top performer

and everyone turns to the CEO for a reaction.

What follows reveals whether the organization is dealing with a rotten apple or a rotten culture.

United: We fly friendly*

At a family gathering last night, I explained my job this way to a distant cousin: “I help our employees answer the question ‘Should we?’ after others have answered yes to the question ‘Can we?'”

I don’t know enough about the airline industry to explain why a passenger was dragged out of a United flight yesterday. But as an Ethics & Compliance Officer and a frequent flyer, I would love to read a statement from United addressing the following questions:

“Here is why we can and should

Overbook our flights, and then
Give seating priority to our employees over paying passengers, and then
Use the police to forcibly remove random passengers.”

If United follows a traditional PR model, we are likely to only get answers to the question “Can we?”

But if United wants to step into the new world of transparency, authenticity, vulnerability and trust, it will also answer the much more difficult question.

* From United’s shared purpose statement