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Best Training Practices
Will Kenny
3927 York Ave N
Robbinsdale, MN 55422

Playing by the Rules: #3
We Mean It!

sometimes there's nothing like an endorsement from leaders

nutshell imageIn a Nutshell . . .

Employees in regulated industries sometimes "outthink" their leadership on compliance with regulations. The front lines sometimes view regulations as a hindrance to their business, but wise executives see the regulatory background as a level playing field.

Problems arise when the employees intellectually grasp the message, but may think that management is promoting compliance because they have to, not because they believe in it. Direct delivery of the message from the horse's mouth (rather than "chain of command" trickle-down) is one of the best ways to correct this problem.

When the front-lines respond to business constraints with avoidance and subterfuge, it is time for the leadership to unequivocally state company values.

Case Study Summary

Business Function:

This company offers a wide range of financial services for individual consumers. With nearly $550 billion in assets, this bank has branches in 23 states.

They Said:

Front-line employees see compliance -- strictly following the letter of the laws and regulations -- as a hindrance to competing with other financial service providers. They tend to "cut corners" in part because they believe that's what top management wants from them (more below on that).

My Take:

This is not that uncommon in compliance situations! A clear statement from company leaders, delivered to everyone who works with customers, can overcome the inconsistency of the message being delivered (and perhaps modeled) by their immediate supervisors. But it has to be convincing, with no room for misinterpretation.


Video presentations that allow the CEO and the President of the company to address every appropriate employee, through staff meetings and other communication functions.


Expectations for performance on this matter became clear and uniform across the company. Energy wasted on dodging regulations could now be applied to customer service.

Well-Intentioned Misbehavior

Sometimes employees think they are doing what you want them to do, even when they aren't, and it can be very difficult to shake their beliefs. Nowhere is this tendency stronger than when it comes to the laws and regulations that govern your business.

Employees don't expect anyone in management to say, explicitly, "Bend or break the rules!" But they can become convinced that that's what management wants, that it is a competitive advantage to cut corners on the rules of the game.

If this behavior continues without forceful correction . . . if, as they say, "good people say nothing" . . . it can become entrenched. Good management knows that the non-compliance is both inefficient and risky, and that the focus should be on efficiency and consistency in regard to following the rules.

This message has to be absolutely clear, and unfortunately, delivering it only through the usual chain of command tends to weaken its impact. It is like the "telephone game" you may have played at parties or in school -- a message that is passed along through a chain of people gets altered along the way. In a large organization, different people start hearing different things, and for something this critical, that just won't work.

A direct address, from the highest leaders straight to the front-lines, is one answer. In smaller companies this can be done in person, but in a client of the size in this case study, videotaped addresses provided the solution.

What It Takes . . .

As I've said, there has to be no doubt about what the leaders are saying. They have to deliver a strong message that leaves no room for employees to think that the executives are saying one thing, and mean another.

That means that the scripting and style of the presentation has to fit the individual personalities of the executives. It requires the ability to write for highly individual leaders in their own voices.

For example . . .

For this company, the CEO and the President both addressed the issue. The excerpts below have been slightly edited from the individual to remove some proprietary references, and we'll call the company XYZ in our examples.

These are only clips from a larger program that reinforced procedures and support functions, but they give the flavor of the most important element of the program, the clear statement of performance standards by the highest leaders in the company.

One of the key messages to the employees was to stop thinking about what the competition might be doing, and focus on XYZ's own standards.

Executive #1

Executive #2

Regulation is part of our business, and there are no benefits to be had from trying to avoid it, or ignore it. We take our obligations to comply with existing regulations very seriously, and we set standards for the fair treatment of our customers that go well beyond the regulations.

Compliance with regulations is just the beginning. We have to take it to the next level, to go beyond compliance to first class customer service. We won't take shortcuts. We're going to do a thorough job with every customer, including following the existing guidelines, and we're going to do it better than anyone else!

This means, above all, that we treat everyone, and I do mean everyone, who does business with XYZ fairly, and that fair treatment will be consistent across all of our customers. Our customers know when they are handled appropriately. They also know when they are not. Every time any customer has any kind of contact with XYZ he or she should expect a consistently high level of service.

To put it simply, consistently fair treatment of all of our customers is the right thing to do. And that's the only way we're going to do business in this company.

When it comes to working within the guidelines, this is not something that a corporation can mandate that everybody do. It is really down to the individual associate, to you and to me, to make sure that each and every one of our customers is treated fairly.

That's why to me, personally, compliance is very important, and I hope it is important to you, too, not just because the regulators are looking at it, but because it is absolutely the right thing. You know, we have guidelines and procedures because they make good business sense for us, not because of auditors or regulators.

After all, if we are truly to become the leader in our industry, it's because customers are going to want to do business with us. We only make money when customers are satisfied, when they do more business with us, and when they continue to buy our products and services.

But I've learned that growing revenue at double digit rates doesn't just happen by selling more, it happens by retaining the customers we already have, losing less, you might say. We can't afford to lose one single customer.

I believe that you wouldn't want any customer to walk away from an interaction with XYZ feeling that they had been treated shabbily. Whenever that happens, that customer is lost to us, probably forever.

Customers are going to respect us because we're an organization that embodies the ethics and integrity that they want in a company they do business with. Obviously, if our goal is truly to maximize sales, we would want every customer to feel that way.

I know we can count on you to do your part.

© 2007 Best Training Practices -- Will Kenny

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