News hit the circuit last week about Wells Fargo employees who, feeling pressured to reach aggressive sales goals, opened up millions of phony credit card and checking accounts in the names of current customers.
Wells Fargo has been fined $185 million. 5,300 hundred workers have been dismissed. And customers will receive full compensation for any fees and charges they incurred as a result of these illegal actions.
And we all shake our heads over how something so BIG could happen in such a highly regulated and monitored industry.
Wells Fargo CFO, John Shrewsbury told CNBC, “These bad practices were not a revenue-generating activity. It was really more at the lower end of the performance scale where people apparently were making bad choices to hang on to their job.”
We’ll leave it to the news sources to debate the implication of that statement and consequence of this situation to the future of Wells Fargo, their management team and the banking industry.
And we’ll leave it to their customers to decide on whether to trust this company again.
Let’s talk about why employees at any organization feel they need to “make bad choices to hang on to their job” and the implications to your business.
Your Organizational Culture
Each company has an organizational culture that defines how things get done.
And every business has work ethics or code of conduct to which they expect employees to work within their organizational culture to get things done.
What happens, though, when the pressure to perform (real or perceived) and ‘get things done’ causes the ‘exception’ to the rule.
A mis-step in ethical behavior can occur when there is a:
- Lack of moral leadership – employees tend to emulate their managers. “Do as I do, not as I say” becomes the formula to follow.
- Hyper-competitiveness – rewarding top performers without knowing how they achieved their goals can create an environment where employees use other methods to enhance their performance.
- No Discipline – If those who do not follow the rules do not get penalized (and may actually get rewarded), then why should anyone else follow the rules?
- Poor communication – Everyone should have a ‘safe’ space to be able to report on issues they feel are not within the ethical codes of the company. “Providing whistleblowers with protection and encouraging employees to report problems help foster an organization that is ethical from top to bottom”, according to the book “Organizational Behavior,” by Don Hellriegel and John W. Slocum.
Where in your organization can you or your employees make a bad choice in order to meet a goal, increase the bottom line numbers or ‘look good’ to a manager or to a customer?
Do you, as a manager, uphold all of the ethical codes of your organizational culture until it comes to the ‘except’ ….
And then, if you do accept the ‘except’ – do you take responsibility for it?
We all get comfortable.
We all want to look good to management, peers, employees and customers.
We all want to please – everyone.
The effects of lack of ethical behavior are wide and deep for any organization.
“Get it done” RIGHT by monitoring your company or department’s efforts regularly.
What systems do you use for checks and balances within your organization? Please share below.