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  • Paul Hobin

Did You "Wells Fargo" A Client Today?

Updated: Apr 2

The Point of Collision Between Policy, Compliance, Your Client and You

The Ball & Chain That Unwise Policy Could Be

Whether policy is a ball and chain to our clients - or to us - is a choice. Our choice.

Illustration by 2jenn/

The premise of this article: How we choose to apply policy to our clients profoundly shapes the resulting relationships. The most important choice is whether we use it as a tool to serve our clients, or as a weapon to point out their errors, threaten them, and cover our own positions. Overly zealous, careless, or simply unthinking applications of policy are a primary reason provider-client relationships are stressed and unproductive. So change it.


This news broke in 2018, but the lesson is eternal. Between 2010 and 2015 approximately 870 homeowners were incorrectly denied mortgage modifications by Wells Fargo, resulting in 545 foreclosures, due to an error in Wells Fargo underwriting software.

Everyone thinks of it as a software problem, something that happened in IT. It is not. It is an administrative failure even more than it is an IT failure and it has something to teach us, the administrators operating functions like procurement, AP, HR and many other corporate overhead departments.

The foreclosures eat at me more than Wells Fargo’s other transgressions because they are a product of administrative negligence. They happened because administrators – people like us – sat around and watched the process wheels grind away and it apparently never occurred to them to observe the processes being executed, to think about the results, to question the output.

Algorithms were allowed to run Wells Fargo into a pit and nobody blinked. Policy – expressed through an algorithm – was allowed to destroy lives and nobody cared.

How we choose to apply policy – yes, we choose – has a profound impact on those we are meant to serve.

1. Inattention to automatic policy decisions – We can fail to analyze, think about or even notice how clients are being “treated” by our systems. As we administer our functions many “decisions” are “built in” and made for us by software and processes – like the mortgage underwriting software at Wells Fargo. That the policy decisions are being made on a distant server by a block of code we’ve never seen does not relieve us of responsibility for them. If it’s our process it’s our decision. It is our responsibility to detect bad decisions imposed by software (and policy) and it is our fault if they go undetected.

2. Using policy to impede rather than facilitate – Policy is a tool through which we provide service. If it is instead a weapon, or a tool to deny service, either the policy is seriously flawed, or we are in the way we’re implementing it. We can give clients reason to view us as roadblocks separating them from desired outcomes, and it starts with how we implement policy.

Pay Attention To How Processes Are Treating Clients

The problem at Wells Fargo started with a software error, but it should have ended with us – administrators.

Errors happen. Programmers write bad code. You and I miss a step in a process or mislay a document. I pride myself on accuracy, but I never shall be perfect. I am all too human for that. So I go about my workday with my eyes open, aware of my own fallibility and watching for signs of error. As information flows through my hands I’m constantly thinking: Does this make sense? Do these numbers add up? Is the computer telling me the answer that intuition tells me is correct?

I’ve never worked in mortgage banking, but I wonder how the Wells Fargo software churned out 870 errors and nobody said, “Wait. Does this make sense? I don’t understand this decision.” I’m guessing, based on long experience in administration, that whoever touched these 870 cases after the machine said “no” didn’t give much thought to what they were looking at. I’ve seen too many people blindly accept the output of algorithms and the dictates of policy as if it were some religious truth.

When the process we’re responsible for executing has automated decision-making built into the process or software tools, we are still responsible for the end product. It doesn’t matter that we’ve never written a line of code. It doesn’t matter that we weren’t consulted on the construction of the process. Our process – our responsibility for the results.

We’re Facilitators, Not Impediments

Policy and what clients want seem destined to collide. So how do we mediate this point of collision between our clients’ needs, corporate policy and government regulatory compliance?

Start by asking, are we using policy as a weapon? Is it our favorite cudgel against unreasonable client demands? Do we use it to avoid having to exercise judgment? Do we view it primarily as a shield behind which we’re covering our butt?

When policy is hard wired into our process and effectively makes decisions for us, is the result logical? Was policy meant to cover this scenario, or did it not imagine these particular circumstances? Is policy doing more harm than good? Is it unreasonably punishing one party in its attempt to do right by another?

If we’re not answering these questions correctly we probably find ourselves with “bad” clients that ignore purchasing policy.[1] [2] They talk to vendors and do deals without informing us. They make unauthorized commitments with zero documentation. They waste money, assume unneeded and sometimes perilous levels of risk, and (in Federal Government contracting) they imperil our status as a Federal contractor with an Approved Purchasing System. They risk the company itself.

We vent about them and threaten them – with policy. There may be formal procedures, signed off by the CPO, calling for punitive steps of increasing severity for repeat offenders.

With all due respect to the CPOs that have allowed such things, you need to take another hard look at this. Our clients – the folks who require goods and services to execute their missions – shouldn’t care about procurement policy or compliance. It is not their job. It is our job.

Let’s look carefully at the claim that “they don’t care”. Our clients do care. They work hard to get the payroll out, print the annual report, prototype a product for an external customer. They’re working nights and weekends and waking up at 3:00 a.m. worrying about something at work. Just because they don’t care about procurement competition levels or small business set-asides doesn’t mean they don’t care. It means they’re focusing on what they’re supposed to be focusing on. It is not their job to focus on and follow procurement policy, it is our job.

What happens when they don’t follow our policy? Too often we go to them with messages like, “You have to” and “You screwed up” and “If you don’t do this we’ll do that to punish you”. Please, stop. I know the objections many will have. “They do this all the time.” “They won’t listen if we don’t hit them over the head.”

They will listen…if we stop creating the antagonism with weaponized policy and use the right words. I have never encountered an internal client that I could not teach, lead and align with policy. It’s about the approach and a proper recognition of who is responsible for what. It’s about where our heart and focus is: on facilitating or impeding desired outcomes.[3] [4]

The relationship where procurement thinks “the client doesn’t give a damn” and the client thinks “procurement is a rule-bound pain in the butt” is an invention, an artefact created neither by a bad client nor by bad procurement policy or people – neither of which exist, regardless of how the parties feel about each other. This relationship of distrust is created in the interface where procurement process, goals, ideals and desires meets the client’s process, goals, ideals and desires.

In that point there’s mismatch – naturally, because their goals and ours have nothing in common. Leave this situation alone, pay it no attention, invest no effort in this interface, and it will blow up. Out of nothing – the non-existent “thing” of the procurement/client interface – will arise endless profit-sucking hostility.

Or – pay attention to the automatic decisions being made by policy and process, whether they’re actually correct and how they’re treating our clients. Remove policy from the client interface by taking full responsibility for it. Lubricate the interface with a heartfelt desire to help the client succeed.

Do it for yourself. When an interface receives no care and the administrative “machine” is doing the hard work of driving output with an ignored, rusted interface between the gears, the clash of forces takes chunks out of both sides. The good news is that if you have one of these derelict client interfaces, the people on the other side desire a better relationship as much as you do. Someone just needs to begin. So begin, and give them a chance to follow your lead.

[1] I use procurement as an example. But this discussion applies everywhere in inter-departmental services. [2] This article is about our policy implementation choices producing profoundly differing results. But a second possibility exists: policy is wrong. Probably not chuck-it-in-the-wastebasket wrong; more likely a little dated, or couldn’t foresee all possible circumstances and is insufficiently flexible. It is not our job to flog people with a policy that doesn’t work. “Doesn’t work” is defined by application of the policy either (a) failing to meet its intended goal or, (b) even when the intended policy goal is reached, on balance it has done more harm than good. If policy doesn’t work it is our responsibility to raise an alarm, to seek an exemption even if none is allowed for in the policy, even ultimately to use our good business judgment and ignore policy in the best, balanced interests of all involved. Yes, that is a risk. And if you work for a poorly managed company you could get fired. But if you work for an organization with solid management they should be paying you – and paying you well – for your powers of observation, analysis and the judgment to take steps that are judicious but require courage. I’m not proposing carelessness. I’m advocating judicious judgment over blind adherence. [3] I first wrote this with “heart” in the line. Then I deleted it; talking about heart seemed less than professional. Less than erudite. Then I put heart back in. Because one of the greatest assets we can bring to administration, and particularly to healing damaged relationships, is heart. We can make a calculated strategic decision to employ a new course of action and that may work. But it’s potentially more powerful to change course because our heart tells us to. Because we want to like our clients and be liked in return. Because the fighting and the tension takes a toll. We feel stressed and lousy and we feel badly knowing they do too. We don’t want an anger-based relationship any more. Heart may also be the best approach because breaking the cycle is not easy. The client is not going to change course the moment we do. Our initial kinder and frankly braver approach is not going to be repaid. It may first be met with hostility, perhaps suspicion, maybe scorn. Our heart-felt desire to change for the sake of all is our greatest asset and source of strength to see it through. [4] Providing customer service to internal customers is an important and different topic than serving external customers, and I’ve written about it on this site. You may prefer to start with a 1,200 word synopsis of the longer article.

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