Updated: Feb 26, 2019
Much has been written about the report by Kenneth Hayne on the findings of the Royal Commission into “Misconduct in the Banking, Superannuation and Financial Services Industry” to give it its full title.
It is very likely that the banks will implement some or all the recommendations; the real question is whether they will really change or will the next Royal Commission uncover new “Misconduct”?
Change is more than compliance. “Experienced finance executives” will have a set of beliefs which influence the decisions they make and arguably how they gave the evidence to the Royal Commission which in some cases rapidly resulted in them losing their jobs.
The first step is getting insights into what is “really” going on in their organisations. Mr Henry in an interview in the Deal points out that he had to read 1200 pages of dense documents for every board meeting. Really? 1200 pages?
It is very likely that people in any organisation will know what is happening. For example, in NAB, dead people were being charged for services. This is a symptom of underlying problems. What the Board needs is much deeper insight in why these problems are occurring in their organisation as a whole, complex organisational system. I wonder if this analysis was in these 1200 pages.
The irony is that this information is readily available in the form of an initial survey and, unlike the increasingly complex and costly compliance measures, the analysis of the symptoms and the suggestions of how to deal with them are correspondingly far less expensive.
Used correctly, this deeper analysis and a different emphasis can help Boards and Executives create performance breakthroughs. And keep them out of the Royal Commission witness box.