Pervasive internal issues are the malignancies that
contribute to the decline of any corporation. While they come in many shapes
and iterations, issues like communication, employee engagement, and employee relations
can quickly derail a corporation’s mission. That’s why corporations across the
country are electing to undergo corporate
culture audits in order to get a full picture of what the internal issues
are so they can make concentrated efforts towards improving their business.
No two culture
audits will ever be the same—which is as it should be. Every company or
organization is fundamentally different from one other, not only due to its structure
and size, but because no workforce should be evaluated with the same measuring
stick as another. It’s imperative that the context of every single corporation
be fully explored. Full context can include, but is never limited to things
like corporate mission, vision, values, internal operations, structure, and
leadership.
Undergoing corporate culture audits is the first real step in addressing pervasive issues within the workplace. Think of it as an annual physical or checkup with a physician for your business. When you go to the doctor, you undergo an examination, and the specialists run tests in order to determine how healthy you are—a corporate culture audit is no different. A corporate culture auditor comes in and evaluates the level of functionality within your corporation so you can start implementing strategies to improve and grow your business. Here are some things that a corporate auditor might look at when they evaluate a corporation or organization:
Is everyone in the company invested in the same
things?
What are the valued differences between your
corporation and the competition?
What are the key measures of success within your
company?
What is the functionality of the leadership in
place versus the leadership required for success?
What are the environmental factors that are
contributing to the decline in culture?
What is the history of your company’s culture
from its foundation?
What are the subcultures that have formed in
your organization and what is their role within the company?
Corporate culture audits usually begin by speaking to
leadership. As the old adage goes, “The fish stinks from the head.” Many
problems within an organization can be traced back to problems with leadership,
and corporate culture auditors evaluate from the top down. Even if a CEO or
manager is engaged in supervision of daily operations, they may still be making
daily mistakes that contribute to stalls in the process.
Once leadership has been evaluated, auditors turn their
attention to internal operations. This involves looking at the chain of
command, the productivity flow (how the integral processes move from employee
to employee), and the quality of communication throughout the company. This
might involve interviewing department heads, reviewing meeting minutes, and
evaluating the environment of the workplace. This step is crucial, because regardless
of the leadership or employees in place, if the ecosystem of the workplace is
flawed, it can be difficult for even the most efficient, engaged employee to achieve
success.
Evaluating the environment and internal operations is
tantamount to establishing a bulletproof process for success—leaving the
workforce as one of the final pillars to be examined by the auditor. When you
seek a comprehensive picture of your employees’ level of engagement, it’s
important for auditors to identify the subcultures that are either contributing
or derailing your company’s mission and values. For example—there might be a
cluster of apathetic employees, who are not only disengaging together, but their
behavior actively encourages other employees to exhibit the same habits. This kind
of apathy can be a cancer in your corporation and may spread to other parts of
your workforce, further contributing to the decline of business.
Most importantly, at the conclusion of the audit, an
investigator will prepare a detailed report with very explicit recommendations
for how to fix the problems within the corporation or organization. This could
include items such as the termination of toxic employees, the revitalization of
internal operations, and necessary changes to a brick and mortar locations for
increased security or higher accountability. Once the audit is complete, the
burden of change lies with leadership to become beacons of change within the
internal structure. Corporate culture begins to improve when leadership
enforces changes from the top, allowing their example to trickle down through
the organization in the form of higher accountability and increased engagement.
If your corporation is suffering from a corporate crisis, don’t hesitate. Corporate culture audits are pulling more and more companies back into the black every day. Even if the crisis seems relatively minor, it could be symptomatic of a larger problem within your organization. Call Lauth Investigations International today for a free quote on our brand-new Corporate Culture Audit (CCA) program. Our dedicated and qualified staff composed of former military and law enforcement officers will get to the bottom of your internal problems. With Lauth Investigations International, you can expect hands-on, comprehensive services, detailed reports, and expert recommendations. When it comes to your business or organization, you should only expect facts, not fiction.
With retailers like Walmart, Kroger, and Amazon at the forefront of consumer watchdogs, the conversation around corporate culture and how it affects business continues to become inwardly focused. The nature of capitalism and supply-and-demand business models sometimes stand in the way of true reform when it comes to some of the nation’s most profitable corporations. Despite major retailers like Walmart and Kroger vowing to improve culture in several arenas of their business, the actual enforcement of these new “policies” has employees feeling lukewarm.
Walmart has recently been at the forefront of several different types of corporate crisis. Most notably, the tragic active shooter event at a Walmart in El Paso, Texas that killed 20 people and left dozens more injured. This horrible event is an example of a contextual corporate crisis, in which external events directly affect the public’s perception of the company. While contextual corporate crises typically have little to do with internal operations, the ever-growing epidemic of gun violence in the United States has CEOs and leadership of large retailers like Walmart rethinking their strategies. Since the shootings, Walmart CEO and President, Doug McMillon has announced the retailer will now discontinue sales of ammunition in their stores for handguns and military-style firearms like AR-15s. More notably, McMillion also said the company would “respectfully request that customers no longer openly carry firearms into their stores” with the exception of law enforcement. For many in the nation, “respectfully requesting” customers not openly carry in their stores is not enough, but it is symptomatic of changes in a capitalist society.
Following the tragedy at El Paso, eight more stores received threats of varying specificity. In the wake of the statement by McMillion, gun rights activists are already reporting individual stores are not enforcing their “respectful request” to not openly carry in their stores. David Amad, the vice president of Open Carry Texas, has reported members of the organization had openly carried in their local Walmart and not a single member was asked to leave, despite their visible firearm. When asked about it, Amad was quoted as saying, “They’re ducking the issue. They are trying to get the gun haters to leave them alone, while at the same time leave us alone when we carry in their stores.”
When it comes to improving the culture and perception of a company in the public eye, there can be no room for soft enforcement of policy. Revised, enforced policies are how companies improve their culture, and no one knows that better than the employees who are seeing internal operations every day. According to the New York Times, “Walmart employees are instructed not to obstruct peaceful shoppers from openly carrying guns in the stores…But if an employee or customer feels unsafe, the store workers should call law enforcement.”
What we know about the cycle of good corporate culture indicates that when employees feel valued, they remain engaged in operations and contribute to the overall improved health of the company. It is not a leap at all to assume employees who do not feel safe in the workplace do not maintain high engagement in daily operations. This is a corporation that is already the subject of gratuitous coverage involving internal issues, such as compensation, work conditions, and how toxic corporate culture continues to pervade within the organization. Now the soft enforcement of no open-carrying in Walmart stores may cause employees to further lose hope that the retail giant will ever make meaningful changes within the organization. Research has shown, as the workforce continues to age, corporations will have no choice but to improve their corporate culture, or risk a consistent pattern of turnover and decline in profits. Glassdoor reported millennials are the largest generation within the workforce currently, and they are the prospective employees who will make unprecedented choices in their employment, favoring healthy corporate culture over high rates of compensation. If corporations wish to retain otherwise dedicated employees for the continued growth of their organization, they’re level of integrity in changing their corporation’s culture must have a stronger resolve.
When it comes to your workplace culture, you don’t know what you don’t know…
We know the importance of conducting independent investigations when an internal crisis arises in a business or organization. While some companies are focusing on revising their company culture in order to improve responses to internal crises, others are seeking an ounce of prevention for a pound of cure. For many businesses and organizations, this means going back to the root of their company culture and conducting a corporate culture audit.
What is corporate culture?
According to the MISTI Training Institute, a corporation’s culture is defined as, “the set of enduring and underlying assumptions and norms that determine how things are actually done in the organization.” This collection of shared beliefs, values, and visions should play a direct role in how the entity handles its day to day operations and shape their overall goals for the future of the company. However, it is not enough for a corporation or organization to have a corporate culture on paper, because the point of having a company culture established is that management and executives with decision-making power exemplify and lead by virtue of these beliefs. That’s why it’s prudent to conduct an internal culture audit in order to identify the core issues that lead to decline in production, revenue, and employee morale.
It’s not uncommon for businesses to encounter an internal crisis. Among the different types of internal crises, some of the most common are employee misconduct, fraud & theft, security vulnerabilities, and workplace safety. It’s also not uncommon for companies to operate under a “fire alarm” system, in which there are focused attempts to put out an internal “fire,” like a complaint of sexual harassment, or reports of theft. Human resource employees can spend so much time putting out fires that there’s no time to investigate the root of these problems and reform policy for smoother, healthier operations.
Typical culture audits
Culture audits can come in many forms and many levels of comprehension. Some assessment firms boast that they will personalize an assessment for their clients—unfortunately, a “personalized” audit can be problematic. If “personalized” is interpreted to mean that the client may specify which aspects of their organization’s culture they would like evaluated, it defeats the purpose of a cultural audit. Culture is not just one aspect of a company, but how all of those aspects harmonize for the good of the company. A typical culture audit includes, but is not limited to:
organizational mission, vision, and values
understanding of and extent of buy-in to mission, vision, and values
how values are symbolized
value differences between the organization and its competitors
identification of key measures of success
type of leadership required
the behaviors and attitudes of management and leadership
background of top managers, including schooling, time with the organization, job experiences, current duties and status, and career path policies, procedures, training requirements, and recognition systems that support or inhibit the ideal culture and behaviors
incidents and examples that illustrate what is really important to the organization
shared language or terminology
other strategic influences in the environment, such as competitive or allied organizations that may influence behavior
cultural heritage or history since founding
organization’s structure and its relation to culture and strategy
behaviors that reinforce core values
identification of subcultures and their roles.
Significance to companies
There are many types of internal crisis that can be prevented with a company culture audit, with two at the forefront of many Human Resource departments and executive leadership: Active shooter events and employee misconduct. Employee misconduct continues to become a higher priority for companies as more victims of employee sexual harassment are coming forward in the wake of the #MeToo movement. When a company’s management does not show initiative to improve operations surrounding these types of complaints, it can create a culture of silence within the workforce. The 2018 Global Business Ethics report stated that the reporting rate for “interpersonal misconduct” was around 30% for sexual harassment, surveying businesses that were actually registered with the researching body. With that level of sexual harassment going unreported within a company, how would leadership know if a pervasive problem exists within their company culture?
Between 2000 and 2017, nearly half of the active shooter events that took place were categorized as places of “commerce,” or business. A startling 60% of the active shooter events that took place in 2018 were also at places of business. In 10% of the cases examined from that FBI 2018 study indicated that the perpetrator exhibited warning signs of active shooter behavior prior to the event, following termination or disciplinary action. Lower & Associates estimates businesses across the United States will lose more than $55 million in employee wages each year due to violence in the workplace. They experience direct losses in the form of medical expenses, workers’ compensation, litigation fees, and indirect losses such as breakdown in operations due to arrested productivity, record-low morale, and public relations nightmares.
The company culture audit is an ounce of prevention for a pound of cure. While many companies consider their culture well-established and well-practiced, the fact remains: You don’t know what you don’t know. That’s why investing in a quarterly or even biannual corporate cultural audit is so crucial for companies. Culture audits can save thousands in the future by identifying problems that would lead to litigation, low morale, and high rates of turnover within a company or organization. Rather than putting out fires on a day to day basis, why not fireproof instead?
Don’t let executive misconduct ruin your corporation…
When it comes to running a business, the executives who are the visionaries and decision-makers that shape a company should always remain above reproach. White collar crimes have the potential to pull a business up from the root with devastating consequences. Unfortunately, Americans know from media coverage and social media that there’s few things we are more attracted to than stories about high-ranking officials and the misconduct that negatively impacts their businesses—both in profits and in public relations.
Many will be familiar with the recent news of Amazon CEO Jeff Bezos’ high-profile divorce following allegations of infidelity, in which his ex-wife became the richest individual in history by virtue of divorce proceedings. The fallout from executive misconduct can leave a trail of legal fees, government sanctions, violations, and public relations-related crises that can devastate a company from the top down.
Thought to be coined in 1932, the phrase “white collar crime” now refers to a spectrum of frauds and other crimes committed by high-ranking executives and officials. The most common characteristics of white collar crime contain aspects of deceit, concealment, or violation of company policies and/or state and federal law. The motive is financial, with executives skimming off the top of a company’s profits for their own use. These crimes are sometimes thought of as “victimless crimes,” with no regard to how the fallout from a fraud or scheme can impact the company, and therefore the families of its employees. The types of fraud include, but are not limited to:
Bank fraud
Blackmail
Bribery
Cellular phone fraud
Computer fraud
Counterfeiting
Credit card fraud
Currency scheme
Environmental schemes
Extortion
Forgery
Health Care Fraud
Insider trading
Insurance fraud
Investment schemes
Kickbacks
Larceny/theft
Money laundering
Racketeering
Securities fraud
Tax evasion
Telemarketing fraud
Welfare fraud
Weights and measures
Corporate fraud and white collar crime of this nature remain one of the Federal Bureau of Investigation’s top priorities when it comes to identifying and indicating perpetrators. While involvement by government agencies may seem like the end of the line, there are ways companies can get out in front of executive misconduct by hiring a private investigator to investigate these matters.
Private investigators have a unique reputation as slick operators who fly under the radar, but they are invaluable professionals to companies in the throes of a corporate crisis because they are independent and objective. Objectivity is the priority when dealing with executive misconduct and white collar crime, as any allegations or evidence presented against the executive must be presented by an individual with no stake in the outcome of the investigation. Private investigators are independently contacted by a business or corporation to investigate the alleged executive misconduct, and can gather evidence and collect witness statements without the air of bias. Because private investigators are independent contractors, there is no fear of reprisal on behalf of coworkers and other employees at the company. This leaves no lead discounted or ignored. They can investigate employees at all levels, and determine how (if at all) the executive is receiving assistance in their fraud from subordinates. One of the most attractive qualities in a private investigator is that their objectivity makes them crucial witnesses in any legal proceedings that may result from the investigation.
Businesses and corporations should never be beholden to CEOs, presidents, and other high-ranking executives who behave badly. Executive misconduct and corruption are like aggressive weeds that must be pulled from the root in order for businesses to flourish. When it comes to rooting out bad leadership, consider hiring a private investigator to navigate a tricky investigative path that can end in quality operations and peace of mind for businesses large and small.
If you have a corporate crisis like executive misconduct, we can help. Call Lauth Investigations International, a family-owned-and-operated investigative firm with over 30 years of providing successful solutions to clients in Indianapolis and throughout the nation. Call 317-951-1100 for a free consultation, or to learn more about our services, please visit our website.
The invention of direct-deposit payments in electronic banking have likely saved companies millions of dollars over the years in labor hours, materials, and fees that previously caused problems for companies. However, in an age where your paycheck is sent automatically to your checking account, phishers are seeking to exploit this automation for personal gain.
The Internal Revenue Service has reported an upswing in various types of fraud that directly target a company’s payroll. While the ruses come in many forms, one of the most popular is phishing emails disguised as legitimate correspondence from an employee or upper management. It’s always an instruction to alter payroll information so that funds would be rerouted to the scammer’s bank account. Once the deed is done, the money is withdrawn and the company is responsible to replace the missing funds. While the FTC and the IRS are constantly reevaluating their strategies for containing these types of fraud, this particular scheme is hard to detect and often goes unreported. The email can outsmart security measures set down by the company or within a company’s email server, and scammers take amounts that can just be written off as unfortunate missteps on behalf of personnel.
Frauds such as these have gone through an evolution as security technology becomes more sophisticated and what we know about internet culture continues to grow. Internet frauds used to be about volume and inattention to detail—thus the birth of phishers, who sent emails rife with spelling and grammar mistakes out to mile-long email lists, casting a wide net throughout the web. Education about fraud has forced scammers to be more cautious. Today, companies who have seen this scam in its newest form remark that these phishing emails look so authentic that there may not be a question in their mind before obliging their request. Security measures that have risen from the nucleus of electronic banking combat wire fraud every day in the United States. Large sums in wire transfers now throw up giant red flags. Phishers and scammers are getting more bang for their buck by taking smaller amounts with more frequency, lurking below the radar. This does not require sophisticated hacking skills. Just the ability to open a Gmail account. Phishers make the account look cosmetically convincing, then throw out the lure. One of the most targeted entities is non-profit organizations, because of the benevolent nature of their business. The idea of someone ripping off a charity or relief organization is horrifying, but the simplicity of scams like this make the opportunity too lucrative to pass up.
It’s frightening how simple the fraud is to pull off, but there is recourse for businesses who are vulnerable to such a scam. One of the non-profits who fell prey to this scam was KVC Health Systems, an agency for child welfare in Kansas City. Their IT director, Erik Nyberg, says it starts with comprehensive education on company procedures, “The CEO is never going to email you out of the blue and ask you for any deposit changes. And if you have any sliver of a doubt, call the person who is making the request.” He goes on to discourage executives and upper management employees from using their personal email accounts to send staff correspondence, and to set email filters that will catch suspicious incoming messages. Social media managers are also cautioned against posting any company information to their pages that could serve to bolster a phisher’s credibility.
If your business has been the target of this wire fraud scam, you are encouraged to report them to the Federal Bureau of Investigation’s IC3 tip line.
