Ombuds Need to Take More Credit, And Responsibility As Well; Or How BP has me thinking about the field.

I have spent 15 years championing the value created by Ombuds Programs, and pushing people in the field to lay claim to the actual benefit they create on behalf of the people that avail themselves of the Ombuds and the host institutions. Untold millions upon millions of dollars of value have been preserved and created by Ombuds Programs throughout the U.S. and all over the world. This remains largely unknown to the public at large, the management/leadership communities and the politically powerful. This is of course painfully unfortunate in its own right, but is made worse by recent revelations about performance and behavior of certain Ombuds programs – because now, the field must claim some of its failings as well.

RAMIT PLUSHNICK-MASTI and NOAKI SCHWARTZ of the AP reported in their article, BP’s own probe finds safety issues on Atlantis rig, that the BP Ombuds Program was aware of a broad array of non-compliant behavior at BP. The article states:

The Associated Press has learned that an independent firm hired by BP substantiated complaints in 2009 that found that the giant petroleum company was violating its own policies by not having completed engineering documents on board the Atlantis when it began operating in 2007.

Stanley Sporkin, a former federal judge whose firm served as BP’s ombudsman, said that the allegation “was substantiated, and that’s it.” The firm was hired by BP in 2006 to act as an independent office to receive and investigate employee complaints.

The Atlantis subcontractor who lodged the complaint was Kenneth Abbott. He was laid off in February 2009 and said in a written statement a few months later that he believes it was partly in retaliation, which the company denied.

When reached by the AP, Abbott said, “I had complained about BP’s problem,” but declined to elaborate.

Sporkin, the former judge who heads the Washington, D.C.-based ombudsman office hired by BP(Author’s Note – The ombudsman office is not in any BP Facility), told the AP his office found in August 2009 that BP’s execution plan for the Atlantis called for all documents to be finalized and onboard before production started.

“That did not happen,” Sporkin said.

Last month, Sporkin’s deputy, Billie Pirner Garde, indicated in an e-mail to Abbott that BP had long known there was a document problem aboard the Atlantis.

“It was … of concern to others who raised the concern before you worked there, while you were there and after you left,” she wrote. “Your raising the issue did not result in any change to the schedule of BP addressing the issues.”

More than a year after Abbott first lodged his complaint, it remains unclear whether BP updated the documents.

Sporkin said BP told his office the company was not federally required to have the documents on board the Atlantis and could change its execution plan at any time.

Sporkin said BP recently told his office they had fixed the problem, yet provided no written documentation.

So by way of a short summary -

1. BP Hired a retired formal Judge and a team that has been as large as 12 to receive complaints as Ombudsman (More on the program here: http://www.ombudsmanecp.com/bpombudsman_investigations.html).
2. Data available to the public suggests they have managed approximately 200 inbound cases per year. (Their 2007 report states this “approximately 200″ and claims that 12 were substantiated.) No data is available for later years, even though BPs sustainability report, which annually mentions the Ombuds Program and names Sporkin each year, provides annual case load numbers for its “Open Talk” program. This data suggests case loads for “Open Talk” ranging between 825 in 2009 to over 1000 in 2006, while citing only “43″ cases for the Sporkin lead Ombudsman Office in its first year.
3. BP’s U.S. Office of the Ombudsman, as they call it, is potentially the most expensive Ombuds Program in the world. Especially when considered on a per case basis.
4. This office received a complaint regarding non-compliant behavior that could impact safety of deep water oil rigs operating in the gulf of Mexico. The source of this claim is terminated from BP.
5. The Office of the Ombudsman:

Publicly acknowledges the complaint

Declares the complaint substantiated

Admits that they (Ombudsman) had knowledge of the issue PRIOR to the compliant

Admits the issue exists AFTER the complaint, and the termination of the author of the complaint, and

Accepts BP saying the issue is remedied with out any documentation.

I  work to help organization recognize the value in their Programs. I work especially hard to ensure maximum recognition of the “costs” of the Ombuds Program by looking at outcomes from many perspectives.

As I sit now looking at footage from the gulf, horrified, I wonder how the ROI equation for the BP U.S. Office of the Ombudsman would appear with the potential cost of the gulf cleanup in its divisor.

I do this with programs that have a complaint pass through the Ombudsman and become expensive litigation. So I think I would have to  (if it can be established that Sporkin and company had information pertinent to the events on Deepwater Horizon, as they have made clear they did for Deepwater Atlantis) add this cost to the program’s divisor.

It must be noted that the BP Office of the Ombudsman does NOT claim to be an IOA compliant program. The Ombudsman is not a member of IOA or USOA to the best of my ability to determine.

That said, if Ombuds, of ALL stripes, want to see the field advance, expand, and contribute to individual, institutional, societal and environmental well being as the model can, they must do more to claim their value and take responsibility, where it actually exists, for the things that they do not prevent, manage, or improve.

Until we can demonstrate effect, impact, and value – even accounting for that which we do not succeed at, we will remain a small, caring, dedicated profession, that is misunderstood, if thought of at all. And as the field continues to allow the word to describe an exceptionally broad range of structural and behavioral uses, we will be burdened with the resultant outcomes of others.

I know I for one am greatly burdened by the thought that the BP U.S. Office of the Ombudsman may have had information with which, had the program been properly structured and actually honored by BP top level leadership, could have changed what we see on our televisions hour after hour, for the last 44 days.

A Lighter Side Bar

My other title for this post was: I wish Andre Marin had been hired at BP.

Can you imagine the recently reappointed Ontario Ombudsman standing for BP Saying….

“the company was not federally required to have the documents on board the Atlantis and could change its execution plan at any time.”

Or

“BP recently told his office they had fixed the problem, yet provided no written documentation.”

Think the situation would be different, and likely BETTER in my desired alternative reality.

NYT Reporting on Lehman MAKES Ombuds Case

The Friday, March 12th New York Times article entitled Lehman Hid Borrowing , Examiner Says, reads:

By May and June of 2008, a Lehman senior vice president, Matthew Lee, wrote to senior management and the firm’s auditors at Ernest & Young flagging “accounting improprieties.” Neither Lehman executives nor Ernest & Youg alerted the firm’s board about Mr. Lee’s allegations, according to the report.

So, a Senior Vice President attempted to draw attention to issues exposing Lehman to signficant risk, but the formal channels blocked that information from moving to the board?

“Employees need to be able to let the board of directors know when they see something that threatens performance or exposes the company to risk.“ Jon McBride and Jim Hostetler make this germane point in their article       “Board Champions for the Ombudsman,”

McBride and Hostetler continue later in their article,

Herb Allison, former chief executive of financial services company TIAA-CREF (Blog Author’s note: Allison currently serves as Assistant Secretary of the Treasury for Financial Stability and oversees the Troubled Asset Relief Program) notes that an ombudsman can tie together a company’s directors and employees and help assure that when problems do arise, directors can know about them and take steps to address them. “An ombudsman provides another avenue for a company to surface and address concerns so they reach the board sooner rather than later.”

Sooner rather than later indeed.  Think for one moment about an alternative scenario. Mr. Lee approaches the Lehman Organizational Ombudsman, a skilled professional, operating a properly structured program, with appropriate reporting lines to the Chairman of the Board and the Audit Committee. The issues are safely raised. Lehman’s board leads a responsible set of counter measures. The Investment Bank does not collapse. The rest of the financial system is concerned, but not at risk. The Bailout is not required, or only at a fraction of the amount actually spent in our reality.

How different would the economy, our political situation, our future be, had this alternative scenario occurred?

By managing a problem early, more options exist, and less total cost is needed to resolve it. An Ombudsman for Lehman would have cost less than a million dollars per year, and would have likely returned many millions of dollars in value to the organization BESIDES managing this event.

Interestingly, this article starts on the Times front page and continues on B2. Facing the article on B3? A discussion about the Financial Reform Bill and the travails is faces on Capital Hill.

Mr. Allison, Senator Dodd, please include this elegant, effective, and valuable mechanism  for managing issues – the Organizational Ombudsman – and require it for the financial sector.

Key point from ERC’s 2009 National Business Ethics Survey

From the Ethics Resource Center’s 2009 National Business Ethics Survey:

ERC’s 2009 update to the National Business Ethics Survey® focuses on the extraordinary economic events of the past two years and their impact on ethics in the American workplace.

Overall, 78 percent of those interviewed this year said they or a colleague had been affected by company efforts to weather the U.S. recession.

Yet surprisingly, most of ERC’s key measures improved:

Misconduct at work is down. Fewer employees said they had witnessed misconduct on the job; the measure fell from 56 percent in 2007 to 49 percent in 2009

Whistleblowing is up.  More employees said they had reported misconduct when they observed it; 63 percent in 2009, up from 58 percent in 2007

Ethical cultures are stronger.  ERC’s measures of the strength of ethical culture in the workplace increased from 53 percent in 2007 to 62 percent this year – a positive sign

Pressure to cut corners is lower.  And overall, perceived pressure to commit an ethics violation – to cut corners, or worse – declined from 10 percent two years ago to 8 percent

Only retaliation against those who reported misconduct increased – a negative trend.                    (my emphasis)

What this may well demonstrate is how FORMAL systems can not support ethical cultures and protect those reporting wrong doing.

By contrast, informal, confidential structures like Organizational Ombuds clearly can.

It would be beneficial if more Ombuds Programs would report if they heard about ethical issues and what outcomes came from their involvement.

It also would not hurt if the ERC would include Ombuds as a tool for addressing ethics and compliance issues. The word does not appear in the final report, which is available here: http://www.ethics.org/nbes/

Ombudsman as an answer to the Financial Meltdown

The Organizational Ombudsman —

Institutionalizing Accountability, Transparency, and Responsibility:

Rebuilding Investor Trust while Protecting Tax-payer Investment

The organizational ombudsman (ombuds) provides the means to rapidly institutionalize needed oversight and improvement into the financial services community in an at-least revenue neutral manner and thus protect the significant investments of the American taxpayer.

By requiring the regulated community to universally deploy ombuds programs, the SEC would create an unobtrusive but impactful layer of oversight. This structure provides the most effective means of assuring the discovery and self-correction of unethical and non-compliant behavior (including fraud, malfeasance, and abuse of power) while providing an additional backstop for public awareness and regulatory action, as appropriate.

Designed on principles of confidentiality, neutrality, independence, and informality, ombuds programs create value by assisting organizational members of all levels, to raise, analyze, resolve, and escalate (or not) issues in the most appropriate manner for the individual and the institution.

Ombuds in many industries have demonstrated significant positive ROI for the host institution. This value is created in numerous ways, including decreased disputing costs, management time savings, and an increase in performance and usage of already operating formal programs such as ethics, compliance, legal, HR, etc. Thus, this highly effective tool is neither costly nor burdensome, but in fact efficient and supportive.

Programs designed to current ombuds profession standards could be fully operational in the investment community in a matter of months, providing significant cost savings, superior creative problem-solving, and expanded communications — the essential attributes for financial firms to overcome the current macro and micro challenges they face. As these improvements become visible to investors, along with the heightened compliance and increased transparency brought about by ombuds activity, the essential process of rebuilding trust in the financial services community via accountability, in the largest sense of the word, can begin.

The Year in Conflict. . . (No Really)

Overwhelmed yet with list upon list of the BEST of 2009? the Worst? Seen enough photos of those who have left us? Or those who have simply left us less well off – be they politicians, business people, celebs or sports figures?

Because of my few years living in Japan, I have always had a slightly more reverential relationship to the New Year than many of my friends and colleagues. Today at around 11:00 AM I realized the gongs of the Temples in Japan were beginning their 108 soundings to conclude at Midnight.  This drove me again to sit and think…about what I do and why…and also what I do not do…

And once again…the filter, or focusing lens of conflict came to me…

Thinking about the conflicts that emerged over the last year that mattered and impacted me – some well dealt with, many not, and others still beyond my capacity to effect – it became clear to me that I have much to do in the New Year. Wonder if the exercise of examining your year from the veiwpoint of conflict would be of use?

A year ago, one relatively orderly competition/conflict had ended, and while it offered great promise to many, it also clearly lead to significant enduring conflicts that have not gone well throughout 2009.  I am of course referring to the election of Barack Obama and the year in politics that has followed. It is no secret that I was a supporter of Mr. Obama, was active in the campaign and even considered joining the administration. Looking at the year in politics, and the acrimony, the struggle, and the ebb and flow, even as a supporter, it is easy to say, the election did not in anyway “resolve” a conflict of opinion.  It may have in fact only sharpened the edges of it.

The performance of the Congress and Senate, the behavior of its membership – whether Joe Wilson’s noted accusation in a joint session, or the hundreds of thousands of exchanges in committee rooms and hallways that go far less reported – conflict in the leadership functions of our nation is INCREASING, and unfortunately not being well dealt with – BY ANYONE.

While there are many who would say we are becoming a much more collaborative culture, I would have to ask us to pause on that opinion and think about it.  That is not what we see in Government Leadership, Politics more widely, Business, or most places I fear. Lindsay Graham, who is my Senator, but not someone I generally agree with, has been censured, cursed, and vilified in his own state, by his own political party, for fundamentally attempting to collaborate with John Kerry. I called his office for the first time not long ago to express my support for him in this regard. I for one do not see how we do not do better when we communicate, explore options, and consider ways forward TOGETHER across differences; be they political, racial, cultural, religious, or other.

Emerging from the political fracas of the year have been those voices that say competition is the right way forward. Some argue for that in the marketplace, or in the social marketplace of ideas, faith and ideology. The problem I have with that mind set is simply that competition largely is a drive to uniformity. I know I have suffered in the business marketplace because from airlines to banks and beyond competition has in fact driven OUT service and choices. And in the course of human history we have never seen competition among cultures lead to peace, productivity, or an ongoing singularity of thought. Why any one believes a “war on terror” can be won, or that a religious tradition, ANY religious tradition can be brought to secondary position of any other is beyond me.

It is my hope in the New Year, to do much more in this space to examine, discuss, and consider the concept of collaboration, and the general principal that managing our conflicts – of all levels and types – offers greater benefit than any of us know.

And with that in mind, I intend to start, with me. How can I do better with those challenges I face…

Here is to a brave new year.

John W. Zinsser

Pacifica Human Communications, LLC.

Conflictbenefit.com

Start at the beginning – What is Conflict2Benefit.

Greetings and welcome to the Conflict Benefit Blog.

This is really quite simple…

Professionally I work in conflict management. In various modes and methods I help individuals, groups and organizations, consider, design, deploy, assess and advance ways to manage the conflicts they face.  Sometimes this is as simple as a supportive conversation.  Other times it as as complex as building the first Organizational Ombudsman Program for use in Japan by Japanese nationals in a company facing serious challenges, or determining what was the value created by an internal dispute resolution program that dealt with 2,400 cases in a work force of 40,000 people.

Regardless of scale or complexity, I do this work because it matters.  It matters to the people involved, and to many who do not even know about it.  More importantly, it matters to me.  Conflict Benefit is not just a witty tag line or marketing riff. It is my story, a way I see my life, and a guiding force.  It’s success is my success.

My hope for this blog is to explore the notion of conflict – in myriad forms – and discuss what might be done, what might have been done, to generate benefit from the situation – real, enduring benefit.  Sometimes the benefit may be measured in time, or dollars, or appreciated in the change of an emotional state from less desired to more desired.  Sometime the benefit my be measured by what did NOT happen.  Plan to explore stories from the news, the business and academic worlds of course.  But also may recall favorite stories, movies, music and more.

The intent will always be to genuinely look for better, learn something, and wonder, out loud, in an organized manner about something we deal with every single day.

Looking forward to doing my best with this and seeing what others might also bring to the table.

Thanks

John