Striving to offer energy and real-life experiences in my talks, I occasionally offer up cash to get audiences engaged. Such incentives reward: the first question, the best question, or a question I’ve not been asked before.
The exercise is clearly one-sided, because I always get to choose the winner. One inquisitive student recently asked me, “In your opinion, where does fraud happen the most?” Now, my briefcase is always handy with relevant data, but this curiosity question got me thinking about more than a few misrepresentations, measurement challenges (like the real impacts of whistleblower laws), government legislation intentions, trite “consultant-speak” mottos, along with one not-so-strange anomaly.
In short, my opinion-position is that fraud happens more often in government. Yes, studies prove this, but think about it for a bit. Greater forces are more readily at work in the competitive arena than in the public sector. Now “let me be clear,” we have uniquely-skilled and knowledgeable regulators–I know this because I have the privilege to work with some of them, and see them in action.
In my opinion, however, competition and their related countervailing forces clearly operate more effectively in industry, and influence the timing of and ultimate outcomes related to ferreting out fraudulent activity.
In the continuum of the marketplace, these countervailing forces are hard at work, and (hopefully) at the top as well as throughout the entity and industry. While I can’t put my finger on the piece, remember CEO Michael Armstrong remarking that his company (AT&T at the time) had been in the network business for a long time, and he just couldn’t understand why WorldCom’s telco-cost-to-revenue relationship was ALWAYS lower?
Turns out he was right.
That “competitive” remark represented another countervailing force (business intelligence) and was absolutely “on the mark,” but Armstrong could not prove it. That particular role was executed by internal experts (i.e. internal audit) reviewing data within the business processes…and they proved it.
Business process experts…now there’s a hard-hitting source of uncovering fraud (and waste, and ineffective business practices).
With many experiences in industry and subsequently in consulting, Jim Wanserski directly assists clients in key projects, underperforming functions, insights from financial data and operations, process improvement…as adjunct management, via consulting engagements, or direct-hire…bringing energy and lessons-learned from his experiences — all for the benefit of mid-size (and up) management teams.