Preventing the Next Scandal

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Wells Fargo Joins Seemingly Endless List of Companies with Chief Executives Involved in Scandal

[September 29, 2016 update – Add Wells Fargo and its chief executive, John Stumph, to the seemingly endless list of scandals that could have been prevented. Read on to learn how to prevent the next scandal.]

Preventing the Next Scandal
German prosecutors raided the offices of Volkswagen AG to secure evidence for the investigation of the company in the emission-cheating scandal. Volkswagen stock has plummeted and the CEO has resigned, maintaining the story that he had no involvement in any wrongdoing. Also, the head of Volkswagen’s U.S. business answered questions from a congressional panel. But, somewhere, deep within the organization, is a person or people who knew exactly the genesis of the software cheat. They also likely know how the cheat has been able to persist through the delivery of 11 millions cars to the marketplace. So, where was the whistleblower?

And the Whistleblower is …
The whistleblower is nonexistent. There isn’t one. And, it really isn’t any surprise. Traditionally, there hasn’t been a safety net for would-be whistleblowers. Their lives are often wrecked by the people in governments, agencies, and corporations whose practices they expose. History reveals it is easier to systematically wreck the lives of the whistleblower and demonize them, than it is to make changes to a system that has run amok to the advantage of some. The list of wrongdoers, both people and organizations is long. View “list of whistleblowers” on Wikipedia and you’ll have days of entertainment, albeit in a dreaded, “watching the aftermath of a train crash”, sort of way. You’ll recognize some high-profile companies and organizations, but you may not know the back stories that led up to the moment the whistle blew. The lead up is the most important and often untold story.

Wasted resources
Imagine all of the resources, human and technological, inside and outside VW, that are focused on the emission cheating scandal. Now add to that, the resources involved in the multitude of other scandals and investigations happening. And to that, imagine further adding the resources yet to be consumed for future scandals that will sadly unfold. It’s abhorrent. Surely we can better make use of those resources, not the least of which would be to spend more time with family and friends and in strengthening our communities. It’s time we stop trashing the human race and the environment in the short run and pretending as though there will be no long-term consequences for generations to come. There always are long term consequences. Short term indulgent thinking is like junk food. It might satisfy our immediate hunger, filling us for the moment. But, it lacks nutritional value and substance. And in the long run, it doesn’t work for your waistline or your health.

Short term indulgent thinking is like junk food. It might satisfy our immediate hunger, filling us for the moment. But, it lacks nutritional value and substance.

You wouldn’t have blown the whistle either
Ask yourself, if you were an employee inside Volkswagen and knew about the emission cheating software, would you have said anything? To whom would you tell? How? When? You probably would not have said anything. Who has the courage to do say or do anything differently than toe the line? After all, if you’re livelihood is dependent upon continued ruinous behavior, whether it is emissions cheating or other nefarious activity, you’re not very motivated to change. Especially if you want to continue eating, paying your bills, and getting about in your life. Why disrupt it, especially for abstract things like other people you don’t know, the climate, or the environment. It’s even easier to justify bad behavior when the results of your actions are “at a distance” or you don’t see the immediate impact in the near term.

The time for change is NOW
As a society, we need a rethink, a re-frame. It’s time we pivot our behavior toward human progress, not away from it. Some of our past behaviors have not been stabilizing for any democracy on earth and they have retarded human progress and harmed the environment. Here are three things we can do to prevent the next Volkswagen emission cheating scandal or Enron debacle or Peanut Corporation of America poisoning or [fill in the blank here].

  1. Create a safety net for would-be whistleblowers
    As I’ve written about previously, we need a culture of care from the board room to the dining room. We also need a safety net for people that can sound the alarm when they see an innovation culture gone awry, whether it is involved in financial engineering, food production, emission scandals, government abuse, healthcare fraud, military wrongdoing, or some other area of society. We need a safety net for the people who have the courage to stand up and declare a system breakdown. But, we know most people won’t tell stories or reveal that bad things are happening unless they feel safe. So, let’s create a safety net for people to tell us when bad things are happening. If a whistleblower advances an accusation and then subsequently gets fired as a result of it, instead of having to crowdfund their way back to financial health they can draw against the safety net aka Whistleblower Insurance Fund. Fund the safety net through fees paid by the perpetrators of past egregious behaviors. In that sense, it is an insurance policy organizations pay into, triggered by their past bad behavior. It could be corrective in that people will feel safer to sound the alarm early, possibly preventing later disastrous and more costly circumstances. So, who would fund such an insurance scheme today? For starters, the banks that engaged in financial engineering that brought about the global financial crisis, automotive makers who delayed recalls that knowingly killed unwitting vehicle occupants, oil companies that have ruined ecosystems, etc.
  2. Create an Early Warning System. Probably the best innovation for policymakers in government and industry would be to collaborate on a system that prevents the need for whistleblowers in the first place. Alongside the notion of “ideas can come from anywhere” organizations also need to instill the notion of warning flags and that anybody can invoke them. As in automotive racing, a black flag means disqualification and a return to the pits. Nobody shoots the messenger, the flagger is safe to be the flagger in future racing events. We need to revere the person that waves the proverbial “unsportsmanlike-conduct” flag. When a rogue engineer, or accountant, or marketer, or whomever, does something that doesn’t appear to advance an agenda that favors humans and the environment or worse outright harms it and subsequently the organization, then we need to make this visible. And, we need this to be made visible long before the train is off the track and things cannot be easily corrected. 11 million cars is the current tally for VW cars affected, along with a 40% slide in stock price, a six billion dollar set aside for fixes (and climbing), halted sales, diminished resale values, and a tarnished brand. An early warning flagging system would be much less expensive.
  3. Declare a Stop. As a species, we originally create industries to do useful things for humanity. It makes us unique from other animals on the planet. And, when industries and institutions stop doing useful things for humanity we need to unwind them, divert them, correct them, check them, and even revoke corporate charters. I’m not suggesting that Volkswagen should go away; I don’t think they should. I think there are many good and innovative people that can do tremendous good for themselves, their country, and for a global community. But, when their culture or leadership prevents them from doing this or their harm exceeds their good, then they need to be stopped.

It is important that preventative measures be taken ahead of more ruin to humans and the environment. Government regulation is necessary but insufficient. We need a more holistic and inclusive system that isn’t reserved for trial lawyers and the judicial system to work on behalf of things already dead or harmed. A free market without any oversight is like the pudgy little kid at mom’s party that takes more cookies when guests are not looking. Pretty soon the cookies are gone and mom’s friend Marge never got one. It’s not immediately obvious why. Thankfully, in our increasingly global community, people are looking. You should be, too.

This article is a call to leadership in all industries, government, and academia to consider that as a human species we ought to be sunsetting wasteful, deceptive, and harmful practices that manufacture financial crises, harm people and the environment, waste human potential, and then remedy it later through courts. Let’s put that nonsense in a museum. But, this article is also a call to action for every member of civil society to engage leadership in that conversation and hold them to a higher account. We can and must do better.

Rather than attack whistleblowers, let’s create a safer environment where we can learn from them, confront our collective reality, correct our behaviors going forward, and move on to creating a better world with more nutritious cookies for mom, Marge, and all. These are conversations worth having inside your organization, with elected officials, among elected officials, and at your dinner table. Or, we can continue to talk about the next scandal over our collective spilled milk.

about the author

Gregory Olson’s latest book is L’ impossi preneurs: A Hopeful Journey Through Tomorrow, a light-hearted and deadly serious book about a brighter future where we live more meaningful lives, governments invest in people and sustainable progress, and technology serves humans. In Chapter 8: Social of the book Gregory provides historical perspective around whistleblowers as well as promotes ideas that would help make society more civil with respect for truth, increased accountability, and transparency. This is good for nations and good for investors in companies who get caught up in scandal.

image of Greg-Olson-Managing Director of Delightability and author of Experience Design BLUEPRINT

Greg also authored The Experience Design Blueprint, a book about designing better experiences and then making them come true. Chapter 8: Promise Delivery System in The Experience Design Blueprint especially pertains to this article. The promise delivery system is a mental model for making and keeping promises to an organization’s various stakeholders. It is technology agnostic. Any organization can operationalize a promise delivery system using whatever technology and personnel it has at its disposal.

Gregory Olson founded strategy and design firm Delightability, LLC. with the belief that if you delight customers then success will follow. He believes that we all have the potential to do better, as individuals, organizations, and communities, but sometimes we need a little help.

Why Your Brain Resists the New

image of highway hypnosis for brain resistance blog post - DelightabilityWe’ve all been there, driving down the highway, listening to music, not really paying attention as our mental autopilot seems to be in control. After we awake from our highway hypnosis, we barely recall the minutes that have passed us by and don’t recognize the distance traveled.

This phenomena happens to us more often than when we are driving. Our brains are resistant to change and want to quickly return to a steady comfortable state. They like to “keep it real” by not accepting too much new information that feels wrong or incompatible. When we receive new information we like to treat it like the familiar and force it to fit our established patterns and ways of thinking, like driving on a familiar road. This isn’t diabolical or manipulative, it is simply part of being an imperfect human.

image of fitting to existing patters for brain resistance post - DelightabilityIt turns out this brain behavior is self preserving. Imagine that we didn’t complete patterns and we had to slow down and think about every single l e t t e r that we typed or r e a d. Imagine that we had to re-learn how to walk each day and to tie our shoes and even how to put those shoes on. Or, that we had to consult our mental checklist for everything we came across to assess its potential threat. Of course everyday life would become daunting with the sheer volume of things we encounter and decisions we face as we go about living, working, and recreating.

But, most of us are blind to this brain truth.
And this is unfortunate, because this same phenomenon can also blind us to opportunity or new learning. It can numb us to the problems others face or even that we all face together. Think climate change, the changing world of work, the shortcomings of capitalism, decaying faith, inequality, corruption, security threats, racism, police brutality, idle capital, corporate short-termism, homelessness, marriage equality, sustainable energy, etc. With each of those subjects you have some familiarity or don’t. You’ve either fit those to existing patterns or cast the unfamiliar ones out as irrelevant. This brain’s inner workings don’t discriminate. This phenomenon equally disadvantages leaders as well as those they would expect to follow them.

image of girl looking out window thinking about new ideas for brain resistance post - DelightabilityThink of how long it takes you to accept the new. Think of your struggle with and opposition to new ideas and initiatives. This same pattern making behavior your brain habitually engages in every day is also the reason why you drink the same coffee, listen to the same radio station, visit the same stores, wear the same brand shoes, and everything else that forms your consumer habits.

“It isn’t so much that you think about these things as much as the fact that you don’t.”

It isn’t so much that you think about these things as much as the fact that you don’t. This is bad news for the shopkeeper in your neighborhood that will never gain your business or the bright kid down the street whose promising idea is denied relevance from the outset. But, its also bad new for you. You could deny yourself enriching experiences and participation in making the world or your own neighborhood and community a better place. And, you might unwittingly shut down and discourage others that are trying to do the same.

image of favorite food for brain resistance blog post - DelightabilityAgain you have something new to think about. I recognize this is dangerous and might not fit your existing patterns. While your protective brain might want to discard this fact I urge you to read on.

Think of your favorite food for just a moment. Visualize eating this favorite food. OK, good I still have you. Hopefully inside that brilliant brain of yours, I’ve successfully linked this article with your favorite food. Now, every time you eat your favorite food, I want you to recall this article about your brain behavior when it is confronted with something new.

This idea of brain resistance isn’t actually a new idea, it’s always been here. Maybe you are now only becoming aware. Machiavelli captured the essence of what I’m saying several centuries ago in this quote,

And it ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.

Because the innovator has for enemies all those who have done well under the old conditions and lukewarm defenders in those who may do well under the new. This coolness arises partly from fear of the opponents, who have the laws on their side, and partly from the incredulity of men, who do not readily believe in new things until they have had a long experience of them.

Thus it happens that whenever those who are hostile have the opportunity to attack they do it like partisans, whilst the others defend lukewarmly….

Niccolò Machiavelli – Italian Diplomat, Political Philosopher, Musician, Poet, and Playwright (1469-1527)

image of high speed train leaving the station for brain resistance blog post - DelightabilityMachiavelli might not have had neuroscience on his side, but he was a keen observer of human behavior. His quote captures well, the barriers that new ideas face. I believe in the resilient of the human spirit. I also believe in the power of collective intelligence. I’m optimistic that good changes are afoot. A more sustainable and more inclusive world is arriving. I look forward to new thinking and the systems and institutions to follow that will put in motion the idle capital and talent that the familiar patterns have sidelined. We needn’t marginalize many of the earths population and create artificial scarcity when we live in such an abundant world. So, give in. Stop resisting a better world. The train of human progress is leaving the station. Please get on board. Humanity needs you.

Guaranteed this will be a better journey than the highway hypnosis that might have you travel to a destination where you’d rather not be. And, remember on this journey, bring along your favorite food; perhaps you’ll share it with a neighbor while discussing that new idea.

About the Author

image of Greg-Olson-Managing Director of Delightability and author of Experience Design BLUEPRINT

Gregory Olson is a consultant, speaker, and author of The Experience Design BLUEPRINT: Recipes for Creating Happier Customers and Healthier Organizations. His latest book project is l’ impossi preneurs: A Hopeful Journey Through Tomorrow.

Learn more and connect with Greg on Linkedin, Facebook, or Twitter.

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Chapters in The Experience Design Blueprint that especially pertain to this post include:

  • Chapter 8: The Promise Delivery System
  • Chapter 9: The Neighborhood
  • Chapter 11: Barriers to Innovation and Overcoming the Wall

See a book summary. Read the book reviews on Amazon. Read The Experience Design Blueprint on Kindle or any device using the free Kindle Reader application or read the full color print edition.  Already read it? Please connect and let me know.