A well known Chinese idiom is 杀鸡儆猴, kill the chicken to warn the monkey. It means punishing an individual as an example to others. Companies often seem scared to kill the chickens--they don't want to make anyone upset or handle the clean-up--but one area that requires killing chickens is corruption.
As long as there are people involved, there will be corruption, deception, or theft. If you work in management or in HR, then you know this all too well. If not, here’s a short list of corruption examples that I have encountered during my career.
- An envelope of cash was handed to me by a supplier.
- Gift cards were given to government officials at holidays.
- A supplier purposefully shipped a dozen containers of inferior products, yet refused to offer any refund.
- A manager asked for a car loan from a supplier in exchange for additional orders.
- Leasehold improvements were expensed rather than amortized.
- Products were removed from storage racks to pass a fire inspection.
- An account executive set-up a fake company with a name similar to the company name in order to receive orders himself.
- The CEO scammed lenders by obtaining equipment lease financing for fake equipment purchased from a fake company he owned.
In each example, I knew the chickens well. In some of them, it was my responsibility to confront the offending chicken, such as when I was offered money. In the final example, there was an FBI-raid and a stand-off outside the chicken's house.
With the overwhelming presence of corruption, deception, and theft, it’s important that companies proactively address it. Here are some suggestions that have worked well for me.
1. Establish anti-corruption policies. Since there are too many situations to innumerate in a policy, it’s important that policies also include a clear decision-making process so employees cannot plead ignorance later on.
2. Regularly train employees on anti-corruption policies. Training should include real-life examples and role playing. Trained employees should sign a commitment to avoid corruption.
3. Require suppliers to sign anti-corruption commitments. Make it clear to suppliers that corruption is not tolerated and they have a feedback option if any employee asks for a favor.
4. Model proper behavior. You cannot expect others to be clean when you are dirty. In the first example above, I immediately told our local Controller and CFO to ensure there was transparency. I also limited orders to the supplier as much as possible.
5. Investigate and punish misdeeds. If you enforce the policies, it will deter others. If nothing is done about misdeeds, then more will be committed by others and your enforcers will stop supporting you.
If you have a culture that allows chickens to survive, then don't be surprised if your company is run by monkeys.
If your company needs help turning around a culture of corruption, please contact YingSix. We are ready to help.
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