Change on St David's Day

On this St David’s Day I have been reflecting on change. St David was a teacher whose last words to his followers have long been encapsulated as a maxim in wales ‘do the little things in life’ a phrase which has had profound meaning for millions as we have locked down in our homes.   We have seen an unprecedented period of change driven by Covid-19 and an incredible transition heralding a ‘new normal’ still yet to be determined. The pandemic has served to expose the inequalities in our societies and highlighted many challenges and I have been wondering (after hundreds of conversations with compliance professionals around these challenges) what they mean for us in Compliance, Ethics and Integrity and the learning landscape. After 17 years in Legal and Compliance Training I have seen so many ‘trends’ and undulations of focus but the pandemic has been a huge level setter in terms of how Boards view their compliance and risk exposure, how training is undertaken and how resources are located and managed. 

I firmly believe that as compliance and ethics professionals we have to fall in love with the changes that we are making and be driven by that purpose of elevating behaviours within our organisations. Most of us have learned that time is not only ‘money’ as the well-known phrase claims (Ben Franklin “Advice to a Young Tradesman”) but it is also our biggest gift, as individuals and as organisations and mastering that elusive work life balance is admonished as one of the greatest challenges of modern day living. The new ‘always on’ culture blurs the line between work and professional life which has moved to new heights with the widespread advent of working from home. It then falls to us as compliance professionals to optimise that time and focus our workforce minds on the messages we want them to retain by ensuring it resonates with them, combatting the inevitable learner fatigue which is an inevitable consequence of that. If we accept Pareto’s 80/20 rule then we will see that 80% of our results from that will come from 20% of our output. So how can we be smart in our approach and how can we achieve remarkable results in this new landscape of remote working and competing messaging on limited exhausted media whilst people remain at their home desks?

The Heart of the Matter

Tom Friedman quotes Dov Seidman (Founder of LRN and author of How: Why We Do Anything Means Everything) talking about how humans will prevail in this hyperconnected world of machines,

“It will be all the things that the heart can do……Humans can love, they can have compassion, they can dream. While humans can act from fear and anger, and be harmful, at their most elevated, they can inspire and be virtuous. And while machines can reliably interoperate, humans, uniquely, can build deep relationships of trust.”

If the heart is our differentiator how do reach the hearts of our employees, the life blood of our organisations? John O’Brien and Andrew Cave would say the key to reaching the hearts of our employees is purpose. They maintain that the past 10 years in particular have seen “the concept if purpose rise as a major influence among leaders across all sectors and around the world” They believe that purpose is the staff motivator, affords a sense of worth, gives a collective sense of value and will drive external engagement with an organisation as a positive influence on the world. To appreciate how we can reach the hearts of our employees, drive our purpose and elevate behaviours we also need to understand the trends that encompass this affinity to purpose. Mark Emmer (Social Trends Facing Business in 2021 and Beyond) shared a trend I found surprising that customers are now actively looking for brands that align with their values indeed 86% of consumers value authenticity as a trait in the brands they select (Digital Trends for 2020 Every Brand Should Know – Khoros).

What Social and Ecological Trends Are At Play

Some of these trends aren’t unique to 2020/2021, Marc Emmer sets our some generic trends that continue to grow ( Unemployment, healthcare, income inequality, changing demographics streaming wars, sexism and equality, diversity and inclusion, mental health) and as a compliance and ethics professional we are all acutely aware that 2020 also brought with it a ‘record year as far as resolutions’ (according to Christopher Cestaro chief of the FCPAS Until in the DOJ’s Fraud section speaking at a TRACE forum in October) and this certainly seemed to be the case for European Head Quartered companies such as Airbus, Novartis and Deutsche Bank and Eni. Digitization deserves closer scrutiny as it will influence how we interact with our employees going forward.

Digital enabled productivity especially in the areas of building supply-chain redundancies, improving data security and increasing the use of advanced technologies in operations has increased significantly. (McKinsey Global Survey results Oct 2020).

Changes in shopping behaviour with many consumers moving online with Germany (previously one of the countries with lower online -penetration rates prior to COVID-19 usage) increasing by 28 percentage points. McKinsey’s results show that the first half of 2020 saw and increase in e-commerce equivalent to that of the previous ten years (Arun Arora, Hamza Khan, Sajal Kohli, and Caroline Tufft, “DTC e-commerce: How consumer brands can get it right,” November 2020.)

Our organisations need to be agile and move quickly in this brave new world and as compliance and ethics professionals we need to be setting the pace of that change in the way we reach the hearts of our employees.

Thinking creatively around our goal of change we need to view change through the lens of factors that must be present for meaningful organizational change to take place. Beckhard-Harris change equation serves as a useful way of thinking about how we can approach generating that change. The equation suggests that we need three things to motivate change in our organisations:

1.      Dissatisfaction – is it bad enough? That’s a tough bar to jump as the fire to change is hard to light.

2.      Vision – what is the vision – this is centered around the values of the company. We know from our work at LRN that Values-based organizations that operate on a set of core principles informing all organisational decisions outperform other companies on every business outcome from innovation to employee retention and combating misconduct.

3.      First Steps – Change must be realistic. How practical are the steps needed to effect change and do the employees understand their role in implementing that change?

We know that people don’t like change, for all my spontaneity and enthusiasm I sometimes find myself resistant to change especially when I do not understand the motivation for that change and the purpose isn’t powerful enough to convince me of the need for it. So what are the tools we can employ to effect change?

Story Telling and Inspiration

So how do we elevate behaviours and effect and implement the change needed in this new normal? We should go back to our values, they are the core of our organisation’s purpose and how we best inspire our employees, the reason they are a part of our organisation in the first place. We need to operationalise those values, bringing them to life by defining the outcomes and behaviours we want to foster through inspirational stories. Milton Erickson is famous for his belief that using stories and anecdotes helps people heal and are a great way to overcome resistance to change as they are more personal and resonate. This is something most of us appreciate and an excellent tool to help critical messaging, to inspire principled performance and to elevate behaviours.

Organisational Culture – Fostering a Culture of Integrity

I’ve always loved the definition of culture shared by Herb Kelleher, the former CEO of Southwest Airlines "Culture is what people do when no-one is looking". 

One of the most rewarding parts of my role is to help the companies I work with build strategies around effecting organsiational culture transformation so that they can feel confident that when no one is looking their culture of doing the right thing is robust. We know that year in year out our Ethics and Compliance Effectiveness Report, finds that values-based ethics and compliance programs are more effective at encouraging ethical behavior than those focused on processes and rules. Some 80 percent of respondents to our research whose E&C programs are rated as high performers on our Program Effectiveness Index said in the past five years their programs have increasingly focused on values, not just rules.

Lisa Osofsky shared with me and my colleague Mike Wright in a recent interview (link here) that the best way companies can help themselves and get their “house in order long before the SFO comes knocking is to really listen to your compliance officers and listen to your risk advisers when they point out points of vulnerability and try to fix those in advance or if you see a problem don’t bury your head in the sand like and ostrich and hope that it will go away”

Communicate The Values

Lisa Osofsky’s comments lead me to one of the most critical steps I believe to designing the culture you desire. You can't just define values and behaviors, post them on a wall somewhere and hope they will just happen. You have to communicate and socialise them, train on them and share stories that reflect on and represent ways that values have been operationalised everything from how employees helped each other or how they helped customers and suppliers.

Tone and the Top and Tone in the Middle

One of the most important ways to get employees to adopt the behaviors associated with the values is for executives to lead by example there is a great paper on this available free on the LRN website here. If the CEO doesn't demonstrate a commitment to the values and become an example for employees the whole culture fails to adopt them. Reinforcing the values in the middle of the organisation is the most challenging but also the most effective in ensuring the adoption of your companies values and there are many ways of achieving the elusive Tone in the Middle which if effective is again shown by LRN’s research to be a characteristic of the top performing companies. Simple, accessible messaging is key.

The Way Forward and Your World and Your Path to Simplicity

St David is famed for a hill rising up under his feet and a white dove landing on his shoulder during a sermon and reportedly advising soldiers to wear leeks in their hats to recognise their own and avoid friendly fire during a battle against the Saxons. Sometimes I think that the task we as compliance professionals are faced with requires miraculous intervention but if we build the right culture by focusing on the foundational tools available to us and employ innovative, creative thinking to our storytelling and messaging we can reach our employees hearts and inspire them not only to do the right thing but to propel our businesses forward with purpose. If you ever want a sounding board or some guidance, creative ideas or feedback around your strategy please don’t hesitate to drop me a line and have a lovely Dydd Gwyl Dewi!