Episode Transcript
[00:00:00] Speaker A: Hi everyone. In this episode we're going to discuss whether root cause analysis is really the right move following investigations. I'm your host Bill Coffin, and this is the Ethicast.
Once an investigation into reports of workplace misconduct is closed, organizations often conduct a root cause analysis or RCA on the issue. But is that always the right course of action? Should root cause analysis be conducted for all investigations or are there certain criteria that should trigger a root cause analysis process?
It's a good question because there are plenty of obstacles to overcome when conducting effective root cause analysis, from incorporating the right data analytics to securing leadership buy in. And perhaps the biggest one of them all is ensuring that the lessons learned after conducting root cause analysis translate into sustainable change rather than becoming an unimpactful check the box exercise.
With us today to discuss all this and more are Jodi Fredrickson and Eric Jorgensen. Jody is VP of Data and Services at Ethisphere where she specializes in implementing corporate compliance solutions for Ethisphere's clients. Her work includes providing clients with ENC thought leadership, drafting and revising policies that meet the highest legal and ethical standards, and evaluating clients ethics and compliance programs. Jody, it's great to see you on the program again. Thank you for joining us.
[00:01:30] Speaker B: Thanks for having me, Bill.
[00:01:31] Speaker A: Eric is a director on the data and services team at Ethisphere and specializes in ENC program management, specifically the evaluation and implementation of corporate compliance and ethics solutions. His work includes evaluations of client programs, assessment of programmatic components, and operational thought leadership for clients. Eric, it's great to have you back. Thank you for joining us.
[00:01:52] Speaker C: Thanks for having me, Bill.
[00:01:53] Speaker A: Jody, once an investigation is closed, should root cause analysis be conducted for all investigations or are there certain criteria that should trigger a root cause analysis process?
[00:02:04] Speaker B: So Bill, this is a really good question and if you think about it, within organizations, many organizations, especially if you know, larger organizations, maybe conducting a lot of investigations and maybe getting a lot of reports, especially for those that maybe don't have a true root cause analysis process in place. The thought of doing root cause analysis for all investigations could be a really serious undertaking and it may not be the best approach.
So one of the things that I think about and I'll advise clients when doing program assessment work is you know, to maybe start on a scalable basis. Think about setting forth criteria for maybe the most impactful investigation so maybe those that pose serious financial risk, perhaps it involves a leader, maybe repeated issues and starting there versus trying to board the ocean and do everything at once. Because what you don't want to do is establish a root cause analysis process and get stretched too thin because then what will end up happening is it may not really be a good process in the end.
So again, thinking about, you know, how are you going to start doing this process? You know, maybe, you know, those type of investigations that really are employee grievances, perhaps you're not going to do root cause analysis for those, you know, especially in early stages.
And then also thinking about whatever you decide to do, documenting that process. And you'll hear that. I'm sure Eric will bring that up as well, you know, later on today when we're talking about how documenting what you're doing, you know, what are you going to do, who is going to be involved, you know, why are you doing it? You know, so really thinking of formalizing the process is important.
[00:04:02] Speaker A: Eric, what are some of the biggest obstacles that organizations face when they're conducting an effective root cause analysis? Are there any strategies that you have for overcoming such obstacles too?
[00:04:12] Speaker C: That's a great question, Bill. I think the thing that I see probably more. There's probably two things that I see most commonly when it comes to working with companies and their approach to, to Rook House analysis and, and some of the pitfalls. The first one I'm going to say is, is really analysis paralysis. It's, it's for anybody who's heard some of the other ethicasts we've done, it's the idea that you have to do everything all at once. Jody referred to it as boiling the ocean and, and I think that's a really applicable way to describe it.
The obstacle is, is, is, is, is being overwhelmed. It's thinking about all the things that we have to do to get this program together to be able to do root cause analysis. And it's overwhelming. So that analysis paralysis, that pulling together the, the, the program, I think is one of the biggest obstacles I see.
The other one, for lack of a better term, I'm gonna, I'm gonna call it organizational resistance. I think there's a couple of components to that.
There's obviously a question of the time involved.
It's people dedicating time to do root cause analysis. If you've got a committee, it's having other people provide their resources and their time, pulling data, pulling numbers, all wondering is this even valuable? Is this really something that we should do? And I would argue it is. It is very much something you should do, but it's still a commitment. And then another component of that, sometimes there are root cause analysis, quite honestly, if it's doing its job, maybe exposing some uncomfortable systemic weaknesses in an organization, it's being able to show where a control is not as strong as it needs to be. It's showing where a check and a balance isn't nearly as effective as it needs to be to counteract these. To get over those obstacles. I would argue first of all, small steps, again, using the boil the ocean analogy, you don't have to hit a home run right away. Let's start with a very simple root cause analysis process. Let's think about how you're going to do it. Jody talked about scaling in the first question and I would argue that's absolutely true. Does it have to be one size fits all? No.
Think about the steps you're going to take based on what the incident was.
The other one is the process that you put into place. Make sure that it's scalable, make sure that it's logical. Make sure that you're not wasting people's time by scaling it. The other piece is having organizational buy in being able to communicate why do we do root cause analysis and why is it important for you? Why is it important for the organization to get to the heart of it? If you're a manufacturing organization and you have defects, you're going to want to find out why. If you're an organization and you've got incidents that need to be investigation investigated, misconduct incidents, it's logical you want to find out why and do what you can to prevent them from happening again.
[00:06:59] Speaker A: Jody, how can RCA data and analytics be leveraged to identify trends and secure leadership buy in?
[00:07:07] Speaker B: So, Bill, if you think about it, when you have root cause analysis information and data, that data can be used and looked at on a trend basis to identify areas regarding the ethics and compliance program that may need to be matured. You know, there may be a control in place that is not effective.
So, and that is really useful to the ethics and compliance function because it can be telling the story to executive leadership as well as to the board about why are you doing something that the function is planning on doing? You know, so if you're developing your roadmap for the year, why are you going to be focusing on updating policies or why are you going to be training on a certain topic? So it really is a value add to show what you're doing and how it's responding to risks that your, that your function sees.
[00:08:03] Speaker A: How do you ensure that lessons learned after conducting root cause analysis translates into sustainable changes rather than just becoming a kind of check the BOX EXERCISE the.
[00:08:12] Speaker B: Last thing you want to be doing is conducting root cause analysis, identifying the root cause and then not having change as a result of it. That creates risk for the ethics and compliance function for sure.
And I think there can almost be a tendency to look, conducting the investigation, find the root cause and then think, okay, our work is done. And that's not true. That's really where the work is beginning. You see the root cause, you need to look for trends and then it's okay, what do we need to do next? Is it strengthening control, whatever the case may be?
But then there needs to be testing after that as well to make sure that that control is actually been enhanced and is abating the risk that was identified through the root cause analys process.
[00:09:08] Speaker A: Eric, what are some of the most common mistakes organizations make when conducting root cause analysis and how would you advise they go about avoiding them?
[00:09:18] Speaker C: I think probably one of the most common mistakes that we see, and we alluded to it earlier in the, in the cast, is going too big. Going too big and getting frustrated with it.
You know, designing your root cause analysis process and thinking you've got to do it all at once, applying the same standards to every incident that comes in, pulling together a huge committee of multiple people to review everything. Just worked with a company earlier this year that had a committee of 10 people that got together and reviewed on a monthly basis for a handful of incidents. And by their own admission, it wasn't the most valuable use of their time. So being able to scale it, being able to mature it as time goes on, being able for it to always grow and get better over time. You don't have to hit a home run the first time.
The other piece I would say is making sure that organizations don't get frustrated, don't get frustrated with the problem. And what I mean by that is not every investigation is going to work its way back to the root cause of some very easy to identify systemic issue that needs to be completed. You know, we need to, we need to revamp our training program because it wasn't effective. Not every investigation is gonna result in that kind of a root cause finding. So not getting frustrated, being able to accept that this was a bad actor, this was a one off, it shouldn't be the default, but being able to accept that not everything is a big deal.
Jodi, any thoughts on other mistakes that we see organizations do?
[00:10:52] Speaker B: I think not having a documented process is a mistake.
And we see this a lot in the program assessment context where organizations will say they have a root cause analysis process and then when you really dig, it's really not formal so it may not be repeatable. If you have a change in the players within the ethics and compliance function or within hr, for example, the process then may change or it may fall apart completely. So I think not having a formalized process is is a potential pitfall or mistake. I think also not having leadership buy in or making sure that your leadership is apprised of what's happening and what you're doing is also a mistake.
As Eric had mentioned, there can be discomfort at times when you're conducting root cause analysis about what the result is and the last thing you want to have happen is engaging in this process, not having leadership aware and then all of a sudden be dealing with some of this uncomfortable, potentially uncomfortable situations down the road. It's easier to deal with it on the front end and having their buy in and their support.
[00:12:11] Speaker C: A lot of the fraud, a lot of the investigations, a lot of the misconduct that we see when there's a post mortem that happens, a lot of times there's a root cause, a lot of times there's a systemic problem. And unfortunately in the vast majority of those cases, if those organizations would have had an effective root cause program, they would have detected it and you wouldn't have seen them on the front page of the of the New York Times.
[00:12:35] Speaker A: Jody and Eric, thank you so much for sharing your insights today on how organizations can best implement root cause analysis to improve the investigations process. And thanks also for this, the third in our series with you on investigations, Best Practices. Thank you so much for joining us on the show.
[00:12:49] Speaker B: Thanks again Bill.
[00:12:50] Speaker C: Thanks for having us.
[00:12:51] Speaker A: Bill to learn more from Jody and Eric, be sure to check out our related episodes, how to Stop Retaliation Before It Starts and Calibrating Discipline in Investigations. We'll provide links to both of those episodes in this episode's show Notes for a ton of free in depth reports, guidance documents, articles, videos and more to help you reach ever higher levels of excellence and ethics, visit Ethispheres Resource center at ethisphere.com resources thanks for joining us. We hope you've enjoyed the show. For new episodes each week, be sure to subscribe to us on YouTube, Apple Podcasts and Spotify. And if you haven't already, please follow at the sphere on LinkedIn as well to help us spread the word about best practices and business integrity. That's all for now, but until next time, remember, strong ethics is good business.
[00:13:45] Speaker C: There.
