Never underestimate the power of employee surveys

The collapse of Enron has caused many to look at the role of Andersen – its
auditor – and the role of non-executive directors.

Arthur Levitt, former chairman of the Securities and Exchange Commission,
has criticised a range of analysts and regulators for failing to notice the
"sham" of Enron’s declared success.

What measures could the non-execs have implemented or analysts asked for
that would have revealed the deep-seated problems of the organisation?

It is obvious the financial results are the last place to demonstrate
problems, even if they are presented straight. Even customer surveys might be
slow to reveal problems.

HR measures could have helped. What were the trends in labour turnover or
sickness absence? Regular employee surveys might have measured employees’ views
on Enron’s stated values (still on its website, believe it or not) which
include respect, integrity, communication and excellence.

Without provoking specific whistle-blowing, regular employee surveys would
surely have started to show concerns about top managers living the values – as
they sold company shares while other employees were forbidden to do so – or
about levels of trust.

Employees know what is going on in organisations in a way outsiders do not.
Perhaps it is time that non-executive directors and analysts started asking for
top line employee research on a regular basis as well as customer survey
results and financial figures.

Jenny Davenport is the director of People in

Comments are closed.