Editor’s Note: Fresh Perspectives is an exclusive series of The Compliance Report that features expertise across Convercent. Each week we will feature a different Convercent expert, capturing their opinion and unique voice. Fresh Perspectives will be published weekly on Fridays.
The individuals that make up your company’s employee roster vary demographically and generationally daily. As older generations retire and younger generations enter, the way you manage and grow your compliance program –within your compliance team and across the organization — must adapt.
WORKFORCE EXPECTATIONS ARE CHANGING – AND FAST
Addressing compliance’s top risk areas requires a dynamic mix of talent and expertise, and that comes down to your workforce. With the workforce’s changing needs coupled with the industry’s changing needs, new layers of compliance and ethics arise. To help close the risk gap, practicing change management is the first step.
Generations are shaped by the economy in which they were raised, world events such as terrorist attacks or wars and the level of education they received.
Disclaimer: these buckets are highly stereotypical, and are not definitive explanations of any one generation. Avoid working off of pure stereotypes when understanding your workforce.
Traditionalists (Born 1925-1945): Experienced WWII and the Great Depression; are known as the “silent” generation, and while loyal, are resistant to change, conform and do not like technology. In a compliance context: They believe the company is always right, will do as they’re told and believe in hierarchical decision-making. Will always prefer a meeting face-to-face.
Baby Boomers (Born 1946-1964): Known as idealists, this generation lived through the assignation of two Kennedy’s and Dr. Martin Luther King, Jr.; experienced the draft and the Vietnam War, and witnessed the Civil Rights Movement among other societal shifts including a rise in women gaining influence in the workforce. They’re hardworking yet are known to be self-centered and self-motivated. In a compliance context: They’re all about using the phone, and once they do report misconduct, they trust that change will happen.
Gen X (Born 1965-1980): An entrepreneurial generation that is comfortable with technology, they are skeptics by nature and question authority. They were likely to see a rise in divorce rates and experience economic uncertainty with the oil crisis, and the rise and fall of the Soviet Union. While flexible and self-reliant, they are motivated by security are not known to take risk. In a compliance context: The internet is their top-of-mind reporting channel. They want to be given a webpage to type it all out, use email or an anonymous forum — and if they need help, they will call you.
Millennials (Gen Y) (Born 1981-2000): The first generation to live their entire life with technology and therefore are skilled multitaskers. Growing up in a society with frequent gun violence in schools and terrorist attacks, they are known to value structure and need constant positive reinforcement. They demand more out of work than just a paycheck than other generations and are the most skilled generation to integrate technology not only in their highly-valued personal life, but in the workplace. In a compliance context: Most concerned with social and ethical impacts and are motivated by a shared purpose. They’re statistically more likely to observe misconduct, second to the Gen X’s to report misconduct and experience perceived retaliation (see ERC’s chart below). Once they report, they expect things to get done fast or risk having it end up on Facebook, Vine, Twitter, YouTube, etc.
To get the most out of these generational differences, Giselle Kovary, managing partner of n-Gen People Performance, Inc. recommends:
- Baby Boomers: managers should express appreciation for their dedication, hard work and long hours
- Generation X: managers should be clear about desired results and the rewards that will be provided for high performance
- Millennials: managers should communicate the impact and contribution this cohort is making to the organization or team
There is a powerful story here about modern compliance.
If a company’s workforce is comprised of the following 10,000 employees:
Traditionalists: 500; Baby Boomers: 2,000; Gen X: 3,000; Millennials: the rest, and growing day by day – consider how this mix impacts the way you manage compliance and ethics across the organization.
In 2016, “compliance” can be viewed as an old, antiquated and rear looking term. It has negative connotations of wrongdoing, tattle telling and a person or department that is only seen when something is wrong. It’s time for it to adapt by establishing positive reinforcement models to resonate and meet the expectations of your employees.
Compliance is woefully unprepared.
Some 30 percent of organizations are doing next to nothing to attract talent to their compliance programs while only 33 percent of technology and data acumen skills are reported to be represented in a corporate compliance function. Tomorrow’s risk management is about real-time monitoring and accurate reporting using big data, and heavily regulated organizations are expected to take the lead, according to the PwC’s 2015 State of Compliance Report, but yet, only 13 percent of organizations are actively recruiting talent fresh out of college – a generation that lives and breathes technology as a way of life.
Not only do these factors impact who makes up your compliance team, but how you spread compliance across the organization as a whole.
START WITH THE WHY
People don’t buy what you do, they buy why you do it
Content means nothing without context. Your employees need to know how and why your compliance messages matter to them, how they impact their role and responsibilities. If you release a new policy, for example, without explaining why it matters or targeting it to the employees it primarily impacts, the likelihood of policies going unread increase.
As a seasoned marketer, this is key when developing messages that resonate with a target audience. When crafting your message, ask yourself three questions:
- Which employees should get the message and how will they benefit from this message?
- What value is this adding to them?
- What insight does this policy or training add to their day-to-day?
In short: employees want to know what’s in for them. They give you a sliver of their time and they need to know what they will get in return.
Example: Would the company’s new policy around in-office dress code impact third-party vendors or remote staff? If the answer is no, don’t send it to them. This will increase propensity rates and give you more accurate data on who is reading it and putting it into action.
Your organization isn’t going to change their behavior unless they believe in why you emphasize compliance and ethics. It’s not psychology, it’s biology, says Simon Sinek, who argues that motivating people is not difficult. (He’s obviously never worked in a compliance role…)
“Those who truly lead are able to create a following of people who act not because they were swayed, but because they were inspired,” he said in a TED Talk. Using his Golden Circle model you can find order and predictability in human behavior and help you start with the why.
There is a reason why Forbes says starting the conversation with why is a “game changer.” Because if you know the why you will figure out the how and the what. And while this is a model that is pitched to help a salesperson sell more stuff, it’s a model you can mimic in order to sell your compliance program to your organization.
The Why is your purpose, your cause and your belief. Why does your compliance program exist? Why do you as the CCO get out of bed in the morning? Why should anyone else? Perhaps it’s because you believe in helping the company be the best it can be. You love success. You love saving the company money. You love keeping it safe and motivated and you love showing sustainable value to the business strategy while being a part of the company as a valued employee. Those are beliefs that your employees can get around and believe in.
Then move into the How (Do your employees know how compliance helps achieve those things?) and the What (Does every single person at your company know what compliance does if they were asked?)
By offering Millennials purposeful work, employees will know exactly how their work relates to larger business outcomes. They’ll unite around a clear, powerful company vision, and company core values will be seen as exciting and not boilerplate,” said Michael Stapleton of AnyPerk, Inc.
Target communication around what motivates each employee – it’s what they expect.
The majority of the workforce will be made of up the Millennial generation (1.5 million in the U.S.). They are driven by doing work that has a purpose. They want to believe in the organization’s mission, and not only by its vision but how it communicates such to each employee.
Combine these motivating factors with other generational motivators such as security for the Gen Xer’s, salary for the Boomers and self-worth for the Traditionalists, and factor them into how you’re communicating about, bringing awareness to and participating in your compliance program. Having a universal communication strategy doesn’t cut it anymore, and you need to resonate with each generation that works in your company when creating a compliance-first culture.
ONE SIZE DOESN’T FIT ANY – YOU HAVE TO THINK LIKE A MARKETER
Compliance is not first nature for, well, anyone. As the head of the compliance department, you need to not only be the evangelist, you have to be the educator.
Marketing is no longer about putting up a billboard on a busy highway or coming up with a clever jingle to increase sales – customers are too smart and see through it. They want to be educated, informed and given something useful.
Simplify your compliance message starting with the why, break it down for your employees in plain language and clearly explain how it benefits them.
One of the best things I always recommend to compliance officers is to look at the ways in which you can simplify your processes. In many ways compliance is a heart to mind exercise. You’re really battling for mind share. If you’re going to engage in that kind of a battle, then look at ways you can make the lives of the people in your organization easier,” said Byrne.
Here are three ways Erica Salmon Byrne, EVP of Governance and Compliance at the Ethisphere Institute suggests to simplify:
- Take your policies and see where you can make it easier for employees to find the guidance they need.
- Position yourself a resource to your business partners that will help them do their business more effectively.
- Streamline your training plan. For example, if you’re training all 5,000 employees on money laundering and know your customer rules, and those rules only affect a third of your employees – stop training all 5,000.
We do a similar messaging process in marketing in no small part due to the rise of social media and sheer volume of information. Savvy consumers expect brands and companies to personalize their products around their needs — when and how they want it. If this isn’t done well, consumers quickly seek for the next best option without the bat of an eye.
Brands succeed when they position themselves as the expert in their area, develop trust and loyalty with their customers. As customers make most decisions before even seeing any marketing materials or going through a sales process, the brand must still influence their decision in a different way.
By knowing your audience, your message wouldn’t fall on deaf ears.
Start by developing personas of the employees you have in your organization. A persona is a fancy marketing term to describe people’s character. For example, adidas’ – maker of athletic shoes, clothing and accessories — audience is let’s say, soccer players. For arbitrary purposes, adidas’ personas are broken down by Professional, Amateur and Beginner with character traits and needs specific to each. By using a segmentation strategy, brands can target and customize their messages to each persona with information that resonates with them.
In other words, a professional competitive soccer player is not going to want the same message as a high school teenager trying out the sport for the first time with friends.
How you deliver your message could make or break your goodwill efforts.
You could have an excellent, poignant and succinct message to send, but if you don’t use the right channels to send it, it will remain flat. To get the same message across to your entire workforce consider how each generation (persona) responds. For Traditionalists, call a face-to-face meeting. For Boomers, you may want to call them or leave a voicemail. For Gen Xer’s, post it on the internal website or send an email. For Millennials, you may want to send them a text message on their phone or use an internal instant messaging program like Lync, Skype or Slack.
MOVING FROM A BUSINESS BLOCKER TO BUSINESS ENABLER
By integrating these suggestions into your compliance strategy you will see a better response from employees, more attention brought to the importance of behaving ethically and an influx of data being sent into your program with more disclosures, attestations and declinations. Why? Because your messages will be heard by the right people at the right time in the way they best respond.
At the same time, if you bring these suggestions into your hiring strategy when building your compliance team, you can expect a high caliber set of individuals who each bring enormous value to compliance from extremely hard working to extremely tech-savvy.
The fruit of your labor will taste like sweet success.
Rather than compliance being seen as a function that is the show stopper or business blocker by pushing another policy or reminding employees not to accept gifts from client, you can position the function as an enabler that influences business strategy, sets employees up for success and the entire organization’s culture so the company can be the best it can be.