Where do you feel most comfortable along the continuum of regulation?  At one extreme is anarchy (“no leader”); and at the other extreme is autarchy (“absolute leader”).  Some will advocate for one of those extremes, emphasizing the merits of unbridled freedom or conversely the merits of order and structure.  Most of us seek some middle ground, but even that presents a conundrum.  A laissez-faire or libertarian approach leans toward anarchy, but also depends heavily on conservative principles of governance and trade.  On the other hand, liberal and socialist principles are typically advocated by those who favor a highly structured, heavily regulated society. 

In business, these same competing concepts can inform our search for common ground.  For-profit companies require efficiency to be competitive, but they also require structure to focus their limited resources.  Not-for-profit organizations may wish to emphasize effectiveness over efficiency, but they are often severely resource-constrained.  In order to achieve their objectives, and to keep all their moving parts from spinning wildly out of control, both for-profit and not-for-profit entities need to develop a system of policies and rules for everyone to follow.  And that system inherently grows as the organization itself grows. 

The C-Suite, usually guided by a Board of Directors, sets the policies and refines the rules by which the organization will operate.  In a well-run organization, the leaders seek input from lower-tier managers and the rest of the employees, as well as their clients and customers, strategic partners, independent experts, and the communities in which they operate.  But every system of policies and rules brings its own set of challenges, especially where personal interests or competitive pressures test the system’s limits. 

Enforcement Is Essential

Similar to laws and government regulations, having a set of corporate policies and rules sometimes means reminding us when we are not in compliance.  Just as drivers running stop signs endanger the public, employees who violate a corporate policy against hand-held cell phone use while driving present a liability risk to themselves, other drivers and to the company itself.  Inappropriate use of company computers or other resources, failure to use safety equipment or procedures, harassment, discrimination, and a host of other rules violations can cost the company dearly if not effectively deterred.  And, unfortunately, such abuses often become regular occurrences where rules are not enforced.     

No one enjoys being called out for a rules infraction, even when we know we are “guilty.”  But when it does happen, we each choose how we will deal with the situation.  Being respectful of each other and of those who serve us, even when we disagree, simply makes the organization better.  Patience and civility make everything easier to accomplish.  So, part of enforcement is insisting on an appropriate response.

Enforcement Is a Customer Service

While enforcement is necessary, compliance itself should never be the objective.  The true objectives of rules enforcement are the promotion of safety, economy, harmony, protection of intellectual and physical property, corporate reputation, the greater good… 

Appropriately enforcing rules requires a keen awareness of those true objectives, as well as an appreciation for excellent customer service and a dose of “common sense.”  When we lose sight of our true objectives, we end up missing opportunities to improve, wasting precious resources, and annoying the very stakeholders we seek to engage. But performed well, enforcement of the rules can make the entire organization stronger.      

Rules Can Create or Destroy Value  

The employees of any given organization may come from all over the world, yet they all somehow discovered at least one thing in common – an organization with a relatable mission in need of their specific talents.  That tapestry of cultures brings a wonderful mix of life experiences and perspectives, along with a wide range of behavioral norms and societal expectations.  In that light, corporate policies and rules need to be thoughtfully constructed and applied, in a way that motivates all employees to comply with them.    

The organization has far less control over the behavior of its customers or clients, short of denying them service.  However, communicating with courtesy and integrity, promptly and consistently, can go a long way in building constructive, lasting customer relationships.  So, having (and enforcing) policies that reinforce employee communication skills and encouraging customer-focused behaviors is equally important.    

The leaders may design and approve corporate policies, but the broad implementation of those policies will ultimately define the organization.  Failure to enforce well-designed policies may be just as damaging as rigorously enforcing poorly-designed policies.  On the other hand, notable successes abound, where the appropriate enforcement of well-designed policies – to include training – serves as a cornerstone of an exemplary corporate culture – Nordstrom, Ritz-Carlton, Southwest Airlines, and Chick-fil-a immediately come to mind.      

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