Rogue behavior costing $36 billion in legal bills since the financial crisis should give every Board member and Executive sleepless nights. Then add the cost to hire significant compliance and security management and staff to curb rogue behavior, and some serious questions need to be asked!
- What part does pressure to chase profitability encourage a greater level of risk to be taken?
- How much risk is the business willing to take? And at what level does risk become reckless?
- Is the level of inter-staff competitiveness so great that irresponsible risk is encouraged?
- How vigilant are those in leadership to the impact of pressure on employees?
Working in an environment pressurized to succeed at all costs, tends to be the norm, especially in the Financial Sector. Just look at Wells Fargo. Whilst taking risk is a legitimate part of building a successful business and keeping ahead of the competition, when pressure and risk collide it can quickly become a weapon in the wrong hands. Unable to balance risk under pressure to achieve results, the line becomes blurred between acceptable business practices and legal or moral improprieties.
Even more alarming, is when Boards and senior executives fail to acknowledge the environments that promote rogue behavior simply to increase profits. It could be argued that they are as culpable as the rogue employee. Daniel Kahneman, in his book Thinking Fast and Slow, says “we can be blind to the obvious, and we are also blind to our blindness.”
Prosecutions and regulatory enforcement stemming from noncompliance related to employee behavior such as corruption, bribery, rogue trading and insider trading are on the rise around the world. In fiscal 2015, the SEC filed nearly 7% more cases over the prior year, meting out $4.2 billion in sanctions.
People are hired for their talent but little attention is paid to their inherent personality. So when an individual is placed under significant pressure or pushed to take excessive risks, their behavior can turn rogue. The good news? When pressure and risk collide can now be predicted.
Using behavioral insights, management can dynamically match employees with specific environmental conditions to determine their potential response to risk and pressure. They can also discern the degree to which such responses could create rogue behavior and negative actions towards the business.
It is no longer enough to simply look at emails, computer keystrokes, outside influences, sick records etc. – the old hat of international espionage and anti-terrorist tools. What should be clearly understood is that the rogue employee is a human being, that when placed under significant pressure to achieve, will take risks.
The question to Boards and Executives is – do you know your employees?
What corporate entities have in their corner is direct and immediate access to their own personnel from top to bottom and every department – including even outside partners and vendors. So the solution is the deployment of a validated personality discovery process, providing hidden insights and a reliable prediction of where security or compliance risks exist.
Based on external research, employees with the following measurable behavioral traits are more likely to engage in rogue behavior when emotionally triggered
- An inventive mind, full of ground-breaking ideas turns their thoughts to curious and devious thinking when, as an example; many of their ideas are rejected.
- A go-getting, determined person, driven to success at any cost; begins to cut corners, as a toxic competitive streak takes over.
- A reticent, uncommunicative, taciturn minded person normally just seen as the quiet one’ begins to hold onto key information that others need, simply because they have taken offense over something trivial.
DNA Behavior International’s validated system gets below the surface to reveal behaviors that, if not managed, can lead to ruinous behavior.
The Unique DNA Behavior Approach is able to Score, Filter, and Prioritize Employee Personality Insights.
Do you think your sales team is connecting (i.e., maximizing revenue) with all the advisors in their territory? They might tell you they are but read on.
I’m very intuitive, said the wholesaler of a major asset management firm. Excellent, we should get along very well, I replied.
I was talking with a wholesaler who wanted to learn more about one of our behavioral solutions, Communication DNA.
The wholesaler’s goal was straightforward: Show me a solution that decreases the amount of time it takes me to get to know an advisor so trust can be built immediately.
The wholesaler was skeptical about what I was saying so we decided to do a test. We had been talking for 30-minutes (about the same amount of time you talk with an advisor) when the wholesaler suggested to me that he could already tell exactly what “type” of personality I was.
Game on, I said.
OK, here’s what I’ve gathered so far about you in the first 30-minutes:
- Very sociable and enjoys people
- Likes to take the lead
So what did I miss? asked the wholesaler.
Just a few pieces of critical information that most sales people miss about me (and why they lose the sale):
- I can be very fun but turn into a “driven, goal-oriented” individual, especially under stress. Do you think an advisor’s job contains any elements of stress? As a wholesaler, you could keep going down the fun path when I have taken a sharp right turn. If you are not with me, I may smile and act like I am listening, but I have totally disengaged.
- Getting me to make a decision: Tell me stories about how you have helped others like me. Don’t try any other “closing technique.”
- Trusting you? I am loyal beyond belief. But you need to prove yourself from both a competency level and people skills in equal amounts.
- The amount of detail: Don’t confuse me with the facts. High- level first or I will not even listen or worse yet, cut you off. I will let you know how much and when I need details so follow my lead.
Now the wholesaler was ready to listen: How could I possibly get all this behavioral intelligence before an advisor even decides to do business with me?
You don’t have much time to create a good impression and to get an advisor to trust you. Find out how to become a behaviorally smart wholesaler. Your business success depends on it.
Most people who have worked in the corporate environment have taken a behavioral assessment, or 2 or 4, or participated in some form of team or leadership development. Sometimes, I hear from leaders that they aren’t sure how to guarantee the exercise provides long-term, bottom-line value. Or I hear from participants, this is great, but I am not clear on what to do with this information. As a former Corporate Leader and a consultant who facilitates these types of exercises and discussions, we have found most people go through the following phases of development:
Most people and consultants are aware of the common phrase “the first step is awareness.” But a good number of people think that means just learning the “lingo” of the particular assessment or methodology and what their “type” is. We encourage the leader, team and participants to honestly evaluate the current effectiveness, strengths and challenges of the team, including, their strategy, goals, and organizational structure (roles, process, and technology) that supports the execution of tasks to accomplish those goals. A more comprehensive review of how the team is working within the context of organizational factors, combined with, an analysis of the different behavioral styles, their natural strengths and struggles, the fit for the role and the fit within the organizational structure, values and behaviors (some people call this ‘culture’) will lead to a greater depth of understanding.
But never stop at Knowing. Many people do and that is why they don’t see a lasting value with these exercises. The entire team, with the leader leading by example, needs to actively participate in the dialogue of what to do with this knowledge. And it can’t be just one team session talking “about” it. The team discussion needs to focus on how to apply this knowledge to their people, process, and technology. Each team member has to internalize ownership by explaining specific actions they are going to take to change how the team is working together. Often people want to focus on what other people need to do and not take ownership.
- Is the reason the budget process is ineffective due to the instructions not being specific enough for Cooperative people who work better with specific instructions?
- Is the process so detailed and constraining that Creative people have even more difficulty following it and the goal is not accomplished?
- Does the CRM / HR / Process technology incorporate this behavioral knowledge in a way that is easy to access and apply at the moment?
Even great leaders and team members, tend to stop at the team session. Research shows that people, on average, require 7 interactions to be able to absorb information and change behavior. Most of us are lucky to communicate something 3 times before we lose patience. In order to truly grow the organization, there needs to be an intentional, specific, coaching or action plan (practice) over time with clear expectations to ensure that all this great learning translates into sustainable productivity enhancements.
It never ceases to amaze me how many organizations rely on groups of people (teams) to deliver significant outcomes for their business, yet invest little resource into understanding the behaviors, communication style and working environment needs of individual members.
Great teams are built on trust. They trust each other and they trust those that lead them. (Trust = the firm belief in the reliability, truth, or ability of someone or something.)
Trust doesn’t appear over night. It takes time. It requires the sharing of personal knowledge. It’s built upon respect, empathy, and a certainty that the relationship is being developed in a mutual way.
Trust increases communication and open, honest communication is essential to building a high-performing team.
Most organizations know the importance of building teams through 1) a shared vision, 2) ensuring that team members have clear roles and responsibilities and 3) are led by a leader whose people skills are honed and mature. But few invest the time or resources into understanding the behavior and communication style of the individuals within a team. Trust cannot be built if team members don’t know each other at a deeper level. If they don’t know how to communication with colleagues and if they haven’t shared how they wish to be communicated!
Trust begins not with knowing how talented a person is (though talent is important to have in a team) it begins by uncovering the core of a person, the behavior that is inherent and will remain steady under pressure. When that is revealed, relationships can be formed in an open and transparent way ? then trust can begin to be built.
Trust is fragile and can be lost quickly through negative experiences which makes it all the more important for it to be built on a firm foundation of communication, information sharing, ideas and opinion sharing, constructive criticism and problem resolution.
Understanding each other’s communication and behavioral style builds a bridge between people that makes trust much easier to be formed in team relationships.
Unlocking inherent behaviors not only reveals communication and decision making styles it also uncovers values. So why is revealing someone’s values important in teams? It ensures leadership can introduce guidelines that line up with the individual’s values which ensures teams are far more likely to respect and follow them.
Entrepreneurs are able to take a new idea and translate it into a tangible business venture through hard work and determination. Successful business leaders are not only savvy on how best to maneuver into a new market, acquire investors and engage customers, but also optimize human capital and skills to complement enterprise strategies. Entrepreneurs must leverage the resources available to generate revenue and increase growth potential. Without proper management of employees, companies may be dragged down by weak practices or delay expansion projects due to a high turnover rate or low productivity levels.
Business builders are in charge of numerous aspects of business operations, including coaching managers on how to promote a positive company culture in the way they treat and oversee their staff. Managers must be equipped with the necessary training, skills and experiences to empower employees rather than stifle them. Particularly in service-oriented companies such as a financial advisory firm, it is imperative for managers to know how to listen to their workers to effectively teach to their skill set and nurture strengths for business growth.
Business leaders must make sure they are creating an environment for staff to feel comfortable expressing ideas and trying something new, without fear of an adverse reaction from an overly involved supervisor. When a boss micromanages their team, staff will have little room or motivation to grow within the company. A stifled employee will likely not feel appreciated by their supervisor(s), dread coming to work each day and offer minimal productivity levels. These unsatisfied workers will operate as if constantly waiting to be reprimanded, corrected or rejected by a superior and may eventually leave the company.
A new business with a limited budget, however, should focus on hiring talented workers who show potential for growth within a company, building up experience and skills that align with enterprise goals. Just as investors will fund a business concept that shows promise for a lucrative future, managers should invest in employees who can help an enterprise surpass expectations with innovative ideas and determination. Becoming an overly involved manager who does not trust employees or allow them to spread their wings will only slow down a company