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UK Survey shows corporate reputations are at risk with uncompromising policies

Thursday 12 February 2009

The National Computing Centre and Erudine, the software specialist in legacy migration and systems development, today announced the results of a  survey of 98 organisations in the UK.

The survey looked at how organisations are addressing the triple challenges of protecting their corporate reputation and brand; the role people, culture and technology play in protecting brands and ensuring shareholder value.

The aim of the survey was to understand whether corporations are effectively addressing the challenges of Corporate Governance and balancing those pressures with the need to improve business performance and promote innovation.

The survey, independently conducted by NCC and sponsored by Erudine, illustrates the extent to which UK organisations are deluding themselves into a false sense of security by applying inflexible and over rigid policies and processes:

• 80% of senior managers in the UK’s larger organisations circumvent organisational policies in the interests of local expediency. 
• Of the 80%, 41.1% do what they feel is appropriate to get the job done, 26.7% have devised their own work-around processes and 8.9% frequently take short cuts 
• Just over a third thought organisations policies a burden to adhere to; in contrast less than 20% never overrode organisational policies.

“This report confirms our fears that in a climate of financial uncertainty many board members are not aware of the reputational risks their organisations are running.  Information is more fluid than credit these days and we urge company boards to review their policies and take note of the points raised in this report,” said Michael Dean, Group Marketing Manager at NCC.

The survey highlighted that when asked what the potential effects on their organisation’s brand could be if processes were being overridden, 70% of respondents cited loss of reputation and loss of customer confidence, whilst 42.2% identified regulatory fines; only 12.2% thought circumventing internal processes would lead to a drop in share price. Those working for smaller organisations were more likely to consider their policies and procedures as a hindrance.  In contrast only 39.4% think they gain a high degree of flexibility and interaction by adhering to organisational policies and procedures.

Commenting on the research Martin Rice, CEO of Erudine said: “Organisations all too often look externally to sources of risk, but as this survey shows, the risks from within are major. Policies have to be workable and not so cumbersome that the workforce makes arbitrary local decisions to circumvent them. They have to strike the right balance between flexibility and control to promote innovation and enable the free flow of business processes.” 

“It is clear from our research that Information Assurance should be the top of the management agenda for the foreseeable future. Market volatility, financial and shareholder pressures and increasing customer demands have left many organisations facing major challenges with respect to risk management, including reputational risk and brand protection,” continued Rice.

The report is available from NCC www.ncc.co.uk and Erudine, click here.

About the survey

The survey 'Protecting Corporate Reputation and Brand, the role of people culture and technology' was conducted during August and September 2008 by National Computing Centre. It consisted of two web-based questionnaires with senior IT professionals from 98 Private and Public sector organisations in the UK; one to investigate the People and Culture aspects and the other focused on Technology solutions.

The survey questionnaires were developed in consultation with NCC member organisation Erudine and the corporate risk body, the Corporate Executive Programme (CEP).

About the National Computing Centre (NCC)

The National Computing Centre (NCC) helps IT decision-makers deliver effective solutions to business problems by bringing together users, experts and vendors to share experiences and develop best practices. We are a non profit distributing organisation.
 
About Erudine

Erudine has introduced a radically different method of system development through its core technology, the Behaviour Engine. An enterprise-grade, integrated development environment that allows systems to be authored and evolved at a low cost and reduced risk, the Behaviour Engine can deliver up to 90% cost-savings, faster time to market, and give true business agility.