Dr Strangelove or: How I Learned to Stop Worrying and Love Regulation


I had an interesting conversation with a representative of a UK Regulator over the festive season. Having been involved in a number of regulatory and compliance programmes it was refreshing to hear the frustrations from the other side of the corporate electrified fence. Regulation is seen as an unnecessary evil, a mishmash of red tape and endless compliance routines that ultimately constrain how a company operates. Whether it’s Health and Safety or Banking codes of conduct the Board see it as overkill and a burden on profits. A typical scenario in an exec meeting goes like this:

CEO: The Regulator has created a bunch of new rules we need to meet.

CTO: Ugh. How much is this going to cost me to change the systems ?

COO: Ugh. How much is this going to cost me to change the process ?

CIO: Ugh. How much is this going to cost me to change the data ?

CMO: Ugh. How much is this going to cost me to change the message ?

CEO: So what’s the minimum we can get away with ?

So what’s wrong with this picture ? Each is worried purely about their cost centre, the impact on their individual silo of the enterprise, and just how little do they need to do to keep the Regulator from their door.

But….not one is interested in the impact on the Customer.

What each fail to realise is that regulation is not meant to constrain the customer experience but enhance and protect it. Many complain that the rules are often nebulous and the onus on them to interpret a rule is lazy but a Regulator waits for companies to exceed the rules of compliance and reshape processes that improve on customer service and protect the customer experience.

Sadly most are bent on scraping over the finishing line and in doing so, do more damage in the process. The knee-jerk reaction to focus purely on internal cost and impact is systemic of an archaic Board mentality which is why so many larger organisations struggle and buck against the Regulators (which actually takes more effort and legal cost than to meet and exceed in the first place).

Be especially wary of solution providers who offer ‘off the shelf’ wares and frameworks that are the silver bullet to the regulatory werewolf problem, invariably they too are interpreted and designed to barely meet regulation so as to minimise the impact on you but not exceed the expectation of both the customer and the Regulator.

2013 will be filled with more regulatory and compliance programmes than in previous years as consumer and economic protection takes hold and become the focus of many governments and regulatory bodies but CEOs should stop worrying and learn to love what’s to come.

If your process exceeds your customer service will succeed.


One response to “Dr Strangelove or: How I Learned to Stop Worrying and Love Regulation

  1. Theo,

    Good points. I happen to be the customer in the ‘Provide Mortgage’ process at this moment. As you know rules have exploded the last few years. 4 years ago I got a mortgage in ten minutes (I know that is also not right) but now I have been busy for 5 weeks.

    With every new person (higher in hierarchy) to check my application I have to deliver more and detailed information. And for sure, I believe it is all for my own sake, but I would have liked if they told me about the process and needed information upfront.

    But, yes! Today I got the money! ……..100% compliant!
    100% Compliant’

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