In Case You Missed It

EricaTU2-webBy Erica Salmon Byrne

A little over a week ago, Bloomberg wrote a story on JP Morgan Chase’s use of predicative analytics to monitor employee behavior and identify rogue employees “before they know they’re rogue.” If you missed it, you can see the full story here.

Big data use, of course, is nothing new – and data monitoring is an important element of a comprehensive ethics and compliance program. And in the story, which made it clear that this program is being implemented in parts of the bank but didn’t say which ones, the bank made sure to note that they are also focusing on “culture change.”  But the piece points out, quite correctly, that it is difficult for a business unit head to know everything about any individual trader; this program is being positioned as one which will support that division leader in identifying people who might land the company in a position where they’re paying attention-grabbing legal fees again. No doubt, that is a noble goal, and one shareholders support (see the CEO’s remarks to investors cited in the article). But there’s zero conversation about how managers are being prepared to receive all that the program will provide them.

And that’s what got me thinking. No matter how good your predictive analytics, no matter how many data points you put in your system, your best defense against “rogue” employees is always going to be your people. The age-old formula still applies: the point of a compliance program is to educate people about the company’s expectations, and then support them in telling you when someone has done the stupid thing.

[bctt tweet=”@esalmonbyrne The best defense against “rogue” employees is always going to be your people. ” via=”no”]

Here’s the challenge, though, as anyone in the field knows. Raising a concern is hard. It takes courage, especially in a culture that does not always support it. That’s why year after year, employees say that the reason they didn’t raise a concern was fear of retaliation. And if they did raise a concern, overwhelmingly the person they raised it with was their manager. Who, according to survey after survey, likely felt ill-prepared to handle that allegation, and either missed the employee soft-serving it, shut the conversation down entirely, or failed to raise it with the appropriate channels inside the company.

I know culture change is hard. Of course it is. But this focus on systems over people is disturbing, and without extensive training for managers on what to do with those numbers, it is fraught with peril as well. This is one challenge that big data can’t solve on its own.


  1. Absolutely right. And leave to a rogue bank to implement such misguided technology

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