Human Resources: A Dismal Profession?

In all the discussion about Wells Fargo in the wake of their sham accounts scandal, there’s been no real mention of who or what was the direct architect of their corporate culture. In my opinion, human resources should be responsible for the integrity of an organization’s culture just as much as the CFO might be responsible for the integrity of that organization’s numbers. I’ve worked in HR – early in my career, I was an HR professional, and throughout my career, I’ve worked with HR roles within my portfolio of responsibilities – and I think it’s safe to say that HR needs to be held accountable for the cultural makeup of a company. They’re the team that develops incentive programs like the ones that allowed 5,300 employees at Wells Fargo to lose their jobs for following their culture’s status quo. They’re the team responsible for ethics training, handling whistleblowers, and helping employees deal with the strain of impossible sales quotas. In my new book (out in January) and in previous blog posts, I’ve compared workplace cultures to ticking time bombs, which go off when a company’s leadership neglects the reality of a workplace structured for scandal. When a culture is a ticking time bomb, HR is almost always part of that problem, either in the form of discouraging whistleblowers, creating programs that don’t truly address interpersonal conflicts associated with sales goals, or creating a veneer of caring about customers and employees that’s entirely false. I suspect much of this went on at Wells Fargo – just look at the HR gobbledygook on their website (which hasn’t been updated since 2015) for evidence of this. However, as much as HR can be part of the problem with workplace culture, they can also be part of the solutions to fix those problems – if only HR professionals had the courage and honesty to stand up, acknowledge cultural issues, and inform leadership in order to make actionable changes needed to avoid disgraces that harm customers as much as they harm the organization’s reputation. 

Photo: Getty Images via Wall Street Journal 

Regarding CAMH's Well@Work Program

I wanted to share this news about the decision I’ve made to rescind my donation to CAMH for their Well@Work program. It was not a quick or easy decision, and in the 11 years that the Faas Foundation has been supporting admirable non-profit organizations, we have never taken back a donation. However, in the face of continual failure to be transparent about how they were using the funds we’d donated specifically for the Well@Work program, we think this decision is the right one. I hope that with this news, CAMH will take a hard look at their organization and consider the well-being of their employees. Check out Global News for my full statements on this situation. 

Image: CAMH, Vince Talotta via The Toronto Star

A Book Every American Should Read Before Election Day!

A new biography of Hitler portrays him as a clownish, perpetually deceitful narcissist that was consistently underestimated by moderates within his government that hoped to moderate him. This new book also draws Hitler as an astute manipulator, able to utilize slick propaganda and grassroots frustration against elite classes to mobilize a huge swath of Germany’s lower-middle-class voters. Sound familiar to anyone? The parallels with Donald Trump are impossible to ignore, and the longer people continue to underestimate him, the more dangerous he becomes. This biography is obviously a must-read for everyone who is still uncertain about their vote on November 8th. Check out the NYT Book Review of Hitler: Ascent 1889 - 1939 by Volker Ullrich for more info.

Images via Bigstock and WikimediaCommons

Being Wells-Fargoed Should Keep Top Executives and Boards of Directors Up at Night

The news broke this morning that Wells Fargo’s board has decided to revoke compensation valued at $41 million from the company’s CEO, John Stumpf, in relation to the sham customer accounts created by employees to fluff sales numbers. Additionally, Wells Fargo’s former head of the community banking division that is the source of the scandal, Carrie Tolstedt, has also been financially penalized. I was surprised to hear that these two were being reprimanded for the scandal by Wells Fargo – but then, it occurred to me just how similar this was to the Volkswagen scandal. As I’ve written about before in Directors & Boards Magazine, both companies initially found that a swath of employees were to blame, before moving up the chain to management-level employees who were turned out only after it became increasingly clear to the public just who was to blame for their respective breaches with the public trust. In short, Wells Fargo is scrambling, just the way VW did when the emissions scandal broke.

I’ve said it before, and I’ll say it again – CEOs need to be aware of what is going on in their businesses. Transparency is the name of the game here – not just with handling scandals in the public eye, but in managing employees in every sector of business. Firing scapegoated lower-level employees and revoking the huge payouts to executives is fundamentally a band-aid approach to fixing the problems that lead to scandals. Firstly, Tolstedt should not have been allowed to retire peacefully with a few penalties imposed on her severance package – Wells Fargo should have made a point of firing her. Additionally, if it is revealed that Stumpf was fully aware of the sham accounts and covered up for them, he should also be dismissed publically. However, before either of those two steps could be taken, the most important course of action for Wells Fargo (and any similarly scandalized corporation) is to conduce a full, comprehensive and objective investigation into the root causes of the wrongdoing that occurred. Having a complete picture is essential to actually curing the problems present in any organization – and it makes a more convincing argument to the public whose trust those organizations are trying to regain.

At the end of the day, Wells Fargo’s behavior is yet another stain on the already-tainted US banking industry. The pervasive nature of short-term goal oriented cultures will almost always result in similar scandals that further erode the public’s trust in those institutions they have no choice but to invest in. It’ll be a long time before those 5,300 employees let go for their “rogue” behavior will be able to get a job again, just like it will be a long time before the employees let go for whistleblowing will feel comfortable standing up for their principles again. Depending on how far this particular scandal goes, perhaps the entire board will need to be replaced before anyone is willing to give Wells Fargo their money again. 

Image: Stumpf on Capitol Hill last week. Image Credit: Gabriella Demczuk for NYT

Post-Industrial Workplace Cultures

There’s a lot of authenticity to this story of a man’s journey through post-industrial America. The reality isn’t those stories of “making your own way;” for the majority of working people, the narrative is filled with tales of coping with big-picture changes in today’s workplace. More respect for the reality of the situation might result in more respect for America’s working class, which has been failed again and again by society at large, in large part contributing to the frustration with authority we’ve seen in modern civic life. You can read this great piece by David Brooks in The New York Times.

Image credit: Luke Sharrett for NYT

Conflating "Happiness" and "Engagement" at Work

I think this article from The Globe and Mail about why it’s okay not to be “happy” at work totally misses the point. Being “happy” at work means different things depending on the work environment itself – it’s not all about being “content” and demanding spiritual and aspirational fulfillment, as this article seems to suggest. For the vast majority of working people today, being “happy” at work means nothing more than operating in a workplace where they’re not being abused or harassed, not living under the threat of layoffs, not being compelled to work unethically (as we’ve recently seen at Wells Fargo), and where they’re not being assessed by a system that’s prone to racial or gendered biases. Many of today’s unengaged workers would be “happy” for a fair shake and a job that values them as people. Conflating psychologically healthy workplaces with lofty and/or unrealistic notions of office “happiness” is not particularly helpful for many of today’s businesses. You can read the article I'm responding to at The Globe and Mail.

The Plague of Ageism

Ageism in the workplace is something I’ve written about extensively. I wanted to highlight a letter to the editor of the New York Times on a recent piece they published on the subject. I completely agree with this letter’s characterization of ageism in the workplace as a “plague.” In the piece this letter responds to, I was startled to learn that data shows age 32 is when women start experiencing ageism in the workplace. This is a widespread, systemic problem that’s only going to get worse if we don’t address it head-on. Any stereotypes about “older workers” don’t really hold up when you look at the data – so why do so many employers scorn the prospect of hiring older employees? You can read that letter to the editor here.

Main Image: Ping Zhu via NYT

The Dangers of Start-Up Culture

The idea of taking a new job at a fresh Silicon Valley start-up can be appealing for many people, especially to the generation that’s just now entering the work force. However, horror stories, like the one provided by WrkRiot, urge me to encourage everyone looking to make it big with a start-up to do their due diligence before signing up. WrkRiot, as The New York Times reports, is a drastic example of a start-up gone wrong. The company aimed to be the new Indeed.com, but ended up losing enough money that the business had to borrow money from employees to provide paychecks. While WrkRiot provides a pretty severe example of Silicon Valley failure, it’s my understanding that this kind of failure is not entirely uncommon in start-up culture. Just like with any organization, it’s important to make sure you do your homework before joining a company, even one that’s quite new, to make sure you’re not stepping into a rat’s nest. 

Image: Penny Kim, a former WrkRiot employee who helped to bring many of the company's issues to light. Credit: Anthony Chiang via NYT

The Disjointed Culture at Work at the Vatican

In my book, I’ve cited the Vatican as an example of a Disjointed Culture – that is, a hierarchical, bureaucratic culture characterized by an oftentimes willful lack of oversight. This story about the Secretariat of the Economy for the Vatican, Cardinal Pell, is really evocative of this. Given widespread authority to revamp the Catholic Church’s finances, his powers have been slowly pared down as special interests within the Church have regained influence. While there’s certainly more to this story, it seems like the Cardinal’s efforts at reform audits are being blocked now, despite the initial power he was given. In this interview, Pell states that his setbacks can be attributed to “people wanting to retain their turf, their traditional role,” and were therefore adverse to changes of any kind. This quote fits perfectly within my observations of Disjointed Cultures in the workplace – there’s an attitude of covering things up, rather than airing dirty laundry and instituting more comprehensive oversight policies. The full story is at The Wall Street Journal.  

Greed Driving a Culture of Corruption at Wells Fargo

I’ve commented on Wells Fargo in the past. Consequently, I’m not completely surprised by the new information on the fraudulent accounts opened at Wells Fargo. A disturbing trend I’ve noticed in the financial sector is a tendency for companies to push their employees towards unrealistic sales goals – oftentimes leading to some form of illegal activity. The fake accounts opened by bankers on their clients’ dime is a total breach of trust – but I don’t lay the blame solely at the feet of the employees who engaged in this behavior. The culture that encouraged this behavior is rooted in greed and disregard for their customers. Wells Fargo, more than any other of the ‘big banks,’ has been able to maintain a veneer of caring for customers after the financial crisis. However, it turns out that they aren’t any different than their peers in the banking industry – demanding so much of their employees, that many felt they had no choice but to cheat the system. You can get more information on this at The New York Times.

Image: Eric Thayer/Bloomberg via NYT