Rules and Sanctions

Rules are usually of limited value unless considered alongside corresponding sanctions.  Sanctions?  Yes, else why would anyone comply with the rules?

Rules, whether part of a legal framework (e.g. national law) or in-house procedural requirements (e.g. part of a management system) are/should be put in place for the wider benefit of consumers.  I’m using the term “consumers” to mean any party that should benefit from application of the rules – whether the “person-in-the-street”, a customer of a product or service or even a colleague whose own work is made easier.  I’m also going to use the term “user” to mean any party expected to comply with the rule.

However, if compliance with a rule confers no benefit to the user, what is the incentive to comply.  In many cases, compliance may actually be a negative-benefit.  For example, compliance with tax rules will mean losing income to the appropriate revenue authority, compliance with driving rules (e.g. a speed limit) may lengthen a journey time, or compliance with a formal company procedure make the task more difficult or take longer.  If a rule deviates from the natural process its effect is to increase the user cost (be it money, time or effort).  Therefore, the incentive drive is to disregard the rule unless there is an accompanying sanction.

The sanction need not necessarily be punitive – as it only needs to offset the increased use cost.  Of course, if the sanction is only infrequently enforced, then it needs a multiplier to become a sufficient offset.  For example, if a fine were imposed every time a driver exceeded the speed limit, it need only be a relatively trivial sum as it would soon mount up for persistent offenders; however, since the majority of cases go unpunished, the fine (and any associated points) needs to be greater (and I’m making no case whether or not the current penalties are appropriate).

The relationship is relatively straightforward within a national legal framework but not so clear within a business.  But the same principle can be brought to bear.  Let’s consider a simple situation where a form needs to be completed to request an action (it could be a requisition or an internal work order).  Users often leave fields blank, requiring the recipient to make further enquiries or even assumptions.  With a well designed form, a simple sanction could be that failing to complete it properly automatically results in its rejection.  No queries or assumptions on the part of the recipient; rather a refusal to accept the user’s error now as their problem.  There will always be exceptions but, with a proper understanding of the process and good form design, following the rules becomes the easiest path.  In fact, there is no longer a need to further document rules beyond the form itself.

That’s a simple example, one I’ve recommended on numerous occasions (with corresponding improvements in process efficiency and effectiveness).  It may not be quite so easy with other work processes but, through better understanding, process design and consideration of the compliance cost, many improvements are possible.

Sanction may certainly sound a harsh term to use and it may be more PC to speak of user compliance cost – but why use three words when one grabs attention?

(Posted as a blog 26th January 2019)