Cultures of Compliance
I have encountered many organizations, mainly in government and academia, where compliance with policies, procedures, and norms became the primary organizational objective. Producing useful outcomes became secondary, almost a nuisance because production took resources away from compliance.
This becomes an almost insurmountable problem when the organization is laced with administrative incompetence. Perhaps well-intended but fundamentally incompetent administrators force compliance on those who would have been producing useful outcomes.
This is further complicated by fragmented and antiquated information systems. One measure of this is the number of times you have to enter your user name and password to accomplish one task. Another measure is the number of times you have to start all over because the system does not recognize the computer they bought for you and told you to use.
The ultimate complication is when the legal function is in charge. They want to make sure that the organization cannot be blamed and held accountable for anything. This objective is, of course, much easier if the organization avoids doing anything.
I once asked a Chief Legal Counsel if her compliance job would not be easier if the organization provided no services, accepted no monies from sponsors, and created nothing of value. She replied, “It certainly would minimize our risks.”
I then asked, “How could the organization survive if it provided no value to anyone?” She responded, “That not my responsibility. My job is to maximize compliance so as to minimize risks. You need to talk to the President if you are concerned about the value we provide.”
She was right. Her function was risk management, not value creation. I talked to the President, but he was all hype and slogans. His dominant goal was assuring a financial surplus each year that got bigger the following year.
I then talked to the organization’s equivalent of production workers. They were frustrated by increasingly tight budgets, driven by the goal for surpluses. They were angry about all the time they had to devote to compliance paperwork, often entering the same information into multiple information systems.
Morale was abysmal across the organization. In the executive suite, however, everything was upbeat. All the slogans were prominent. Glossy brochures touted the smoothly running organization. Everything was aligned for an unfortunate surprise.
