The recent arrest of UBS trader Kweku Adoboli sends the compliance police into hyper drive.  The chants for more regulation for banks is deafening.

If only this was the answer.

Passing a law with more regulation seems logical . . . especially to politicians (sarcasm).  It just gets very expensive and gives us a false sense of security.  Regulation does not guarantee that consumers are protected and more inspection gets expensive.

Organizations the world wide are seeking an answer to those that cheat.  Governance, compliance, risk, audit and inspection looking for a solution. Putting in safeguards is a common approach . . . and it doesn’t work.

The problem is that someone wanting to cheat the system can always out-savvy the best efforts to thwart it.  The next fraud won’t look like the last one, yet that is what we try to prevent based on history.

The problem is more systemic.  Eliminate the incentive to cheat and your organization can avoid additional regulations, inspections and audits.  Costs go down in a dramatic fashion.

It seems we have built organizations to increase an individual’s personal balance sheet and income statement.  This makes little sense in a world that has ethic and economic problems.  What ever happened to the greater good and a purpose beyond ourselves?

Designing systems that individuals can take pride in and provide more and more jobs is a purpose that W. Edwards Deming challenged us with years ago.  His advice continues to fall on deaf ears.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for  Learn more about the Vanguard Method for service organizations.  Reach him on Twitter at LinkedIn at