At 2:37 in the morning, a message flashed across my screen: “Do you have five minutes?” It was from one of my banking clients, a relationship manager who’d attended one of my workshop sessions on change. He was one of those amazing individuals with the courage to question conservative thinking and introduce a fresh perspective. Now one of his courageous ideas had run up against the bank’s immune system, and what he was experiencing wasn’t pretty.
Along with the automobile industry, pharmaceuticals, defence and airlines, banking tops the list of highly compliance-regulated industries. The reasons compliance is a cornerstone of the financial industry are excellent, including safety, fraud and protection of clients. But I’d also claim that compliance has become “a cornerstone excuse”, preventing the industry from evolving and keeping its employees from thriving.
A simple idea — allowing representatives from risk to join relationship managers on client visits to assess the actual situation with his own eyes — took shape in a recent ideation session. The idea was quickly paralysed when one participant said: “Back in 1998, compliance rejected a similar idea.” The idea died just that fast, even though the 1998 situation actually bore little resemblance to the current state of things. In the heat of the moment, the threat of compliance was enough to derail the conversation and kill the project — ironically typically without the compliance folk even being aware their name had been invoked.
Along with the automobile industry, pharmaceuticals, defence and airlines, banking tops the list of highly compliance regulated industries
I recall an instance of senior management of a major international bank who told me they were eager to dial up their customer experience. When I asked how often they spend time with existing and potential customers, they admitted: “Never. We’ve considered doing it, but compliance always rejects the suggestion.”
Luckily, I happened to have compliance on speed-dial. “Is it true,” I asked, “that you’ve rejected requests by managers to conduct one-on-one ethnographic interviews with customers?” The answer from compliance: “No, never. In fact, we’ve never been asked.”
This didn’t happen just once. In fact, it’s rather a repetitious Groundhog Day experience, happening over and over again, with compliance turned into a scapegoat. So, I decided to do the unthinkable: to run a “marriage counselling session” for compliance and those departments that are deeply dependent on compliance. This workshop was designed to grasp the truth, align objectives and establish a healthy collaboration.
This important meeting was scheduled and everyone was ready to go, until that 2:37am message. The person writing to me in the wee hours of the night was the person every bank should breed more of: a go-getter, a doer, the type of person who’s willing to make things happen. But he told me: “My manager has informed me that proceeding with this meeting will put me in breach of compliance. I’ll lose my job.” His good intentions were called into question. He’d collided with reality.
I’ve learned that if your gut tells you things are right, you’d be well advised to hold your breath and trust your instinct. Your gut knows what your head hasn’t yet figured out. With that in mind, I took credit for the initiative, kicked it off, and waited for the explosive response. If this had been a Hollywood movie, the reaction from throughout the organisation would have dismayed the director. Where was the drama? Rather than a vigorous objection, compliance’s response was more in line with: “Fine, let’s make it happen, we’d be glad to take part. All you needed to do was engage us.” Even when they heard that my aim was to re-brand compliance into “enable and protect”, they agreed.
Now, two years later, compliance collaborates with departments throughout that bank to enable new initiatives; strives to better understand customers; and goes out of its way to reduce bureaucracy in the bank’s operations. And, yes, they do this while continuing to protect the bank and its customers. These days, they are no longer involved only when there’s no way not to involve them. They’re engaged right up front, partnering with other departments to shape solutions that tick all the right boxes. People throughout the bank no longer avoid talking to compliance out of fear of the ramifications.
It sounds super simple because it is. Here’s the fact: the secret of change is to focus all of our energy on breaking down barriers. Rather than fighting the old, let’s concentrate on building the new — no matter how uncomfortable it may seem at 2:37 in the morning.
Martin Lindstrom is an author and founder of Lindstrom Company, a business transformation group.