This article will appeal more if you are in Audit / Compliance / Operations / Risk.
It is from the book 21 Office Situations & How to Deal with Them.
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On 12 August 2013, news websites reported –
“Travel website Yatra. com seems to have forgotten to renew its domain name. The name had apparently been registered on August 9, 2000, and expired on August 9, 2013. This was first spotted when surfers …..”
This issue isn’t unique to Yatra.
Other domain names, including Google have faced something similar.
The above are visible instance of lapses.
But something similar – in many multiples of above – happens internally in any company.
Take any error at work, and chances are it is a lapse; in other words, if you had put good controls the first time around, the error would not happened.
What contributes to this lapse at work?
The amount of new info that an individual today faces at work is brutal and exhausting.
It is a combination of –
Audit Reports + Regulatory Directives + New Processes + Process Improvement + System Workarounds + Company Guidelines + Manager’s Essentials + Customer Complaints + ….
Sooner or later, something is going to fall through the cracks.
Some examples of the above; it mirrors what I experienced at work in a bank.
Regulatory Directives: 11 April.
Circular received from tax department. Going forward Service Tax (on bank locker fees) to be levied at 14.00% (instead of the existing 12.36%)
Company Guidelines: 13 April.
Received email from HR. New recruits should undertake AML (Anti-Money Laundering) online training, within one month of joining the company.
Manager’s Essentials: 15 April.
Mail received from the CEO. Managers should nominate staff for the newly constituted ‘Employee of the Month’ award by 5th of the month.
If you really make note, 15 – 20 new learning, per month, per manager, would be very normal.
How does one manage this deluge of info, so that he or she doesn’t forget anything?
The solution: It is the Checklist.
Implemented well, a light one-pager, diligently updated – of each manager, team leader, team member – will be flexible enough to carry forward the learning.
A pictorial representation here of how a checklist can encompass everything you face at work.
I share an example of how a Checklist helped me
It was mid-2008.
We had migrated a 20-member securities operation from the bank to a group company.
I too shifted to the new city where the group company was based.
In the first meeting called by my new boss, I mentioned, “Sir, our SEBI license is up for renewal. It is to be renewed every 5 years. The application for renewal needs to be sent 3 months before the expiry date.”
The boss asked, “How did you know it is to be renewed now?”
I said, “Sir, It is there in my checklist.”
The boss seemed surprised, “Something to be done once every 5 years?”
I said, “Yes Sir, it has everything.”
The boss remarked, “Great. Here (referring to a lapse that was discussed earlier in the meeting) we have people forgetting things to be done on a daily basis.”
Later on it occurred to me there was another reason for boss’s surprise.
Before the securities operation was migrated, there was a thorough review: audit observations were signed off, work-motion analysis was done, existing system bugs were agreed to, training was arranged, etc., etc.
But this fact – that the underlying regulatory license needed renewal every 5 years – seemed to have escaped everyone’s attention.
In other words, a one-line item on my checklist was the only thing standing between the company and a significant regulatory lapse!
Checklist: A Perspective
We seniors (managers and above) tend to look at checklists as something that is applicable to junior team members only.
It will then be worthwhile to see how a checklist solved a world-wide problem.
Example
Until 1953, there was no standard procedure to determine if a new-born baby was in distress. The physicians used their own judgement.
Many times the danger signs were missed and infants died.
It was around this time that Virginia Apgar, an anesthesiologist, developed a 5 point checklist (heart rate, respiration, reflex, muscle tone, and colour), and assigned them scores (0, 1 and 2).
Babies would be rated 1 minute after they were born and their scores added up.
A score of 10 meant great. A score of 4 meant the baby needed urgent attention.
This Apgar Score continues to be used in delivery rooms across the world till today, and has helped to save millions of infant lives.
(The above is from the book It’s not the How or the What but the Who, by Claudio Fernandez Araoz, Chapter 16.)
A 1-pager thus brought the entire medical world on one page!
This example as such has a bigger lesson.
Organisations today create elaborate risk and control structures, adding layers with each major lapse.
But – Emails, Diary, Minutes of Meetings, 10-pager Process Notes, bulky Audit Reports, Root-cause analysis – these all will wither away with time, first from sight, then from mind.
You will go away, but the company will remain.
Efforts as such should be made to assimilate the risk-knowledge so gained – in a user-friendly, one-pager – so that it is easy to pass on to the person who comes after you.
Only then will we see a sustainable improvement in risk and control.
Practical Issues in implementation of Checklist
We know Checklist is a good thing but somehow it does not seem fast or flexible enough to what we face at work.
Over a decade of faith and practice, I have come to some benchmarks. I invite you to read the following.
1. Do’s and Don’ts of Checklist
9 Do’s and Don’ts of a robust checklist, specific to a corporate setup. You can read the same here.
2. How to get your team to take their Checklists seriously?
This is something I struggled with for years; the faith that I had in Checklist, how do I build the same in my 1-downs?
After months and a year of tinkering on this aspect, I finally found a solution. You can read it here.
(In the book, I also give a detail example of a manager’s learning over a month, and how to incorporate the same in a checklist.)
5-minute Implementation
Going forward, you can do a simple 5-minute thing that will lead to good controls right away.
The next time you see some change – an audit observation, a new process, a customer complaint, etc. – ask:
– Is the issue important and requires long-term adherence?
– If yes, how do I lock it in my (or my team’s) Checklist?
Make this a reflex action – as it became to me – and soon, you will have controls that will match the best in the world.