Worry more about employees who are dishonest in little ways

Let’s say you find out one of your employees sold a piece of company equipment on eBay and pocketed the cash. Let’s say this theft cost your company $1,000. That’s nothing to sneeze at, right? But now let’s say you have more than a dozen employees posting on Facebook throughout the day, cheating a bit on their expense reports, and taking company pens, snacks from the break room, and extra time at lunch. These “little” dishonesties cumulatively are costing your company far more than that one employee who stole big.

According to Dan Ariely, a behavioral economics professor and author of The (Honest) Truth About Dishonesty, you should be more worried about these little indiscretions. Not only are they more expensive than you may think, they are far more common than many companies are willing to admit. Ariely has done some interesting studies on the subject of dishonest behavior.

What some of his studies have found is that people in general are more likely to be dishonest in small ways and are more likely to steal when the theft is distanced from cash. What do we mean by “distanced from cash”? Take, for instance, your petty cash. It’s a pretty brazen employee who would reach in and take a dollar from the drawer. However, most employees wouldn’t think much about taking a pen from the supply room or running a couple personal letters through the postage machine. The difference is, the pen and the postage are further away from cash. The same principle applies when it comes to employees who take extra time at lunch or spend company time checking personal email or websites.

So how do we combat this problem, which is far bigger than we can imagine? Ariely has a few suggestions.

Lay the groundwork: Provide ethical training

This may sound like it’s right from the TV show The Office, but ethics training can be tremendously helpful to employees. Having employees walk through various scenarios involving ethical dilemmas can help them understand some of the gray areas they might not have otherwise considered. Simply pointing out, for example, the true cost of a 30-minute personal call can really help their understanding of what is expected. As with goal-setting, creating well-understood expectations is one of the keys to running a successful business and having happy and productive employees.

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Let them know where you stand: Don’t have fuzzy rules

Make sure your employee policies are well defined and precise. For instance, if you’d like to give your employees a chance to enjoy some Facebook time, allow it between noon and 1 p.m. That way, at 2 p.m., they know they are outside the rules. Having a rule that states “limited to one hour a day” allows your employees to lose track and fudge the rule. Clearly state what you expect.

Help them do the right thing: Give moral reminders

In order to become accredited by the Better Business Bureau, a company promises to abide by the BBB Standards of Trust. These include telling the truth, advertising honestly, being transparent, honoring promises, and more. With each accreditation packet, companies are provided flyers that list these standards. According to Ariely, posting these standards can be a great way to prevent dishonesty. They provide a moral reminder to your employees. If your company has a pledge or honor code, it could be helpful to post it at your workplace.

Kimberly Hazen is the regional director for the southwest region of the Wisconsin Better Business Bureau. In her role, she works to advance marketplace trust between buyers and sellers and to promote informed buying decisions.

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