Motivating business around compliance | Clarasys

Executive summary

• Motivating the front office to support the organisation to meet their regulatory obligations is a key challenge for compliance functions
• As the complexity of the regulatory environment grows, this increasingly requires the front office to be adopting the right behaviours – not just ensuring the right forms are completed
• Scientific research consistently suggests that in these sorts of environments, external factors (e.g. targets and rewards) are not the most effective way of driving motivation
• Instead, tapping into people’s intrinsic motivation is much more likely to yield the intended results

Compliance and motivation

Many organisations have ‘grown’ up holding two beliefs close to their hearts:

1. If you dangle the carrot of paying people more, they’ll be more motivated
2. If you link people’s pay to what you want them to do, they’ll do it.

The reason? When the work is predictable, repetitive and requires minimal cognitive reasoning – these extrinsic factors work.

However, the modern regulatory environment is far from being predictable and repetitive. It is increasingly complex and varied and reliant on people doing the right thing – not just following the right procedure. When it comes to this sort of work, years of social science suggests that, contrary to many organisation’s beliefs, the extrinsic factors don’t work. In these sorts of environments, compliance functions need to tap into the intrinsic motivation of the front office teams.

When it comes to defining intrinsic motivation, various models exist that articulate similar themes in different ways. For the purpose of this post, I am using the model Dan Pink describes (you can see more about this in this ted talk). In this model, intrinsic motivation is boiled down to three factors:

1. Autonomy – the urge to direct our own lives
2. Mastery – the desire to get better and better at something that matters
3. Purpose – The yearning to do what we do in the service of something larger than ourselves

The more staff are able to self-direct the work they are doing, the greater the opportunity they have to master something, and the clearer and more important the purpose, the more motivated they will be.

The vicious cycle

When you contrast this to the historical approach many compliance organisation have taken, it is easy to see why achieving compliance has been a challenge. In many cases, a prescriptive approach was taken, defining exactly what the front office need to do (e.g. no autonomy), with little meaningful explanation of what it means to do it well (e.g. no opportunity to master) and communicated with a focus on the ‘what’, not the ‘why’ (e.g. no clear purpose). Further, this approach has often instigated a vicious circle, where non-compliance is met by yet more prescriptive rules that trigger the same loop again.

The virtuous cycle

So what does it mean to do it differently?

Achieving a virtuous cycle will, in many cases, require a fundamental shift in approach, away from the prescriptive model to an educative model. This means one where compliance teams focus on education around why things need to change (and in doing so, provide a clear purpose), where they let the front office take a lead role in proposing solutions for how to achieve the regulatory outcomes required (e.g. providing them with the autonomy). In doing so, the front office is presented with the opportunity to master.

Where to start?

For many compliance functions, the best way to start will be to look at the last regulatory change they implemented and ask themselves a few key questions:

1. In terms of the communication / training provided, what percentage of the content was focused on the ‘what’ compared with the ‘why’
2. What involvement did the front office have in defining how to meet the regulatory obligations?
3. Have you had to introduce additional rules to ‘patch up’ areas that were missed?

Whatever the answers, the next time you look to review an existing or implement a change, ask yourselves: How do I tap into the intrinsic motivation of the front office staff?