Elsewhere on our website this week you can find an excellent article on the policy management questions about that most difficult of policies a compliance officer has to manage: business travel. If you’re looking for a good overview of the latest risks a travel policy should address, and how to impose one, give it a read.
Here, however, I want to approach business travel from a different angle—because I can’t cite a better example of how companies try to implement a well-meaning policy and poison their culture along the way. Business travel is the perfect case-study of the limits of policy management butting up against the desire for a strong corporate culture.
The subject has been on my mind ever since an acquaintance called me to complain about his own company’s horrendous new policy for business travel. For reasons unclear to him—because the compliance department at his organization hasn’t explained why its new policy is necessary—he must now follow this procedure to book a flight:
He searches for flights on Kayak or Expedia or some similar website;
He takes a screen shot of his preferred flights and submits them for review to an outside travel-management company;
The travel-management company reviews those choices, and sends back some smaller number that are acceptable under the new policy;
He then chooses his actual flight from that filtered group, and sends that request back to the travel-management company;
The travel-management company then books his final choice.
This ridiculous rigmarole can take two weeks to arrange a single trip, my friend tells me. What’s more, his company now generally permits only the cheapest flights, which means he usually needs to make a connection—an extra hassle and risk I wouldn’t wish on anyone in the United States. My friend must make four trips from Chicago to Miami this spring. None of them will be nonstop, even though 102 nonstop flights happen between those cities every day.
Now consider the travel policy for a company run here in Boston by another friend of mine: Don’t buy an airline ticket that costs more than $550 without asking first, and nobody ever flies first class at company expense. Don’t stay in a hotel room that costs more than $300 a night without asking first. Don’t spend more than $60 per person on dinner, $30 per person on lunch or breakfast. If you do, either prove how your spending was an emergency or cover the expense yourself.
That policy, in a slim 70 words, hits all the principles a compliance officer would want a travel policy to address: spending limits, permitted practices, exception requests, and punishment for deviation from the policy. Now, perhaps a large global company needs more detailed procedures for international travel and business, as our other article this week addresses. Tax, security, and anti-bribery risks can be many and diverse in while trotting around the globe, and a 70-word policy won’t cover all of them. Appending some more detailed list of procedures for specific risks would be perfectly reasonable—even if those procedures achieve that same mix of Dilbert and Kafka that my first friend described above.
Success, however, hinges on this: the second company drafts policies with an eye towards empowering employees to act, and empowered workers make for a stronger corporate culture. The first company drafts policies as nothing more than a series of compliance procedures to follow, and that sucks the spirit right out of your culture. Once an employee gets the idea in his head that the company is rescinding his freedom—which my first friend’s company is very much doing—you’ve lost the culture war.
If you don’t give workers tools to empower them to do their jobs, they will seek ways to evade the obstacles (read: policies) you put between them and doing their jobs. This is an axiom of business life, and as anyone who has encountered a stupid policy knows, you will often go to great, foolish lengths to evade a policy you don’t like. If you remove an employee’s freedom to think and exercise judgment while following a policy, the employee stops thinking and exercising judgment entirely. And then those precise policies and embedded controls do you the compliance officer no good at all.
My first friend, by the way, spent 22.5 hours booking his four trips this spring. He’s in sales, and that’s 22.5 hours he couldn’t spend selling. What message he takes away about senior executives’ concern for company culture and values, I don’t even want to imagine.