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inquest into labour party’s 2019 general election defeat

Did you spot the unacknowledged explanation for the UK’s low productivity growth?

when two new words enter a language, its meaning often represents a sociological journey from denial or misunderstanding to acknowledgment. When the words are spoken by a major personality at a big historical event, its significance then becomes recognised and its implications start being examined – and hopefully addressed. when two new words enter a language, its meaning often represents a sociological journey from denial or misunderstanding to acknowledgment. When the words are spoken by a major personality at a big historical event, its significance then becomes recognised and its implications start being examined – and hopefully addressed. 

Such were the words “corporate amnesia” uttered on the first day of formal reflection by the Labour Party into their disastrous defeat at the 2019 General Election (December 17, 2019). They were made by the Labour peer Dame Margaret Hodge, an arch-critic of the Labour Party’s leadership who retained her seat as a Labour MP.  As the scourge of Government waste when she chaired the Public Accounts Committee, her conclusion was that the Labour Party was in denial of what happened, one of the physiognomies of corporate amnesia, others being that the corporate body disremembers its history, interrupts its organic continuity and becomes less able to learn from both past failures or successes. In Labour’s case, they had become experiential NON-learners, the exact circumstance of Britain’s employers, no thanks to corporate amnesia’s main modern architect, the very flexible labour market.

The nearest the subject gets to being acknowledged as a proper business concern is the occasional discussion around the importance of ‘institutional memory’ but Dame Margaret Hodge’s usage of corporate amnesia is its first mention by a leading ‘influencer’ to signal the damaging effect of actual knowledge loss and self-denial. The fact that the Labour Party is a well-known and important national institution will have raised the subject’s dysfunctional potential even further.

While the gathering impact of modern corporate amnesia through flexible working was first identified by this author in the 1980s, employers, business educationalists and the experts have largely ignored its delinquent significance, namely the dramatic effect on workplace continuity, the equally high levels of institute-specific knowledge loss and linked poorer decision-making, the typical response by employers being to vainly try and reduce their workplace churn. More skilled employees have now also enthusiastically adopted the business model to improve their remuneration and career prospects such that average staff turnover in the UK is now 26% a year, employer tenure is around five years, and falling, while the official projection is that new entrants to the workplace will have at least 10 different paymasters in their working lifetime (

All this experiential NON-learning explains the pandemic of repeated mistakes, re-invented wheels and other unlearned lessons that litter the workplace. In truth, the modern workplace is nomadic, rootless, disloyal, amnesiac, insecure and needy, no place for organic or productivity growth. And because it’s impacting almost every employing organisation in the country, it’s as macro-economic as any of the other corporate resources that the experts have identified as the influences affecting our lowly national output and competitiveness.

If employers want to take full advantage of flexible working, they also have to address their workplace disruption, their loss of valuable institute-specific knowledge and experience and their consequential poorer decision-making.

+ Other similar words/phrases that needed high-profile acknowledgment to get recognised: feminism, global warming, transgender, fake news, et al. Refer also celebrity causes that need prominent mention to get noticed.

KNOWLEDGE SHARING: Without it, Knowledge Management is pointless, so what’s best practice?

knowledge sharing1

 The subject of knowledge sharing is one on which depends the whole subject of Knowledge Management (KM). Without it, there’s little point in KM, so why do employers find it so difficult to progress this crucial discipline, which is still in the Cinderella stage of its essential development?

The short answer is that so few of them understand KM’s new importance; the longer answer is that their corporate culture is stuck in a previous age along with their unhoned skills.

The so-called Knowledge Age make this intellectual commodity essential to acquire while the flexible labour market makes it even more important for rolling generations of employees to inherit. Otherwise, organic progress is – simply stated – disabled. To avoid this, knowledge sharing is key.

Yet employees are reluctant to share their knowledge for a range of seemingly intractable reasons buried in a cultural minefield ranging from beliefs that knowledge provides them with job security to a fear of negative work evaluations. Alongside some of these accurate cultural perceptions, employers seem happy to concede that knowledge is proprietorially owned by the employee, a hangover from the days when a job-for-life was commonplace; thusly, their employee-held corporate knowledge would continue to be accessible.

No more. The average tenure of the modern employee (including top decision-makers) is now around three-to-five years in economies such as the UK’s and the US’s. Although employee change doesn’t happen all at the same time, the net effect on employers is both evident and widespread – continual workplace disruption while much of their unique, hard-won and expensively-acquired knowledge and experience walks out of the front door on a regular basis, preventing them from smooth learning from their own experience. Academics have estimated that, when individuals leave, they take with them up to 90% of their employers’ unique knowledge, much of it falling into an undocumented class of intellectual capital known as tacit knowledge.

The irony is stark. Employers are wittingly disenfranchising themselves from their own labour – all because of actively-encouraged short tenure and the unresolved question of who owns the knowledge that employees acquire in their jobs? Valued employers have also jumped on the bandwagon as a way of advancing their careers and salaries. The answer, which I’ve raised in my books and blog, is something I’ve been addressing for some time, with some success.

To address this, employers have to acknowledge that the rolling transplantation of new employees, even those in similar sectors or seemingly better qualified, is never seamless. As such, knowledge sharing among employees, and especially between changing generations of replacements, is the only way to fill the experiential gap, so employers have to create an accommodating culture within the organisation. The excellent short Paper by Zach Wahl of the consultancy firm Enterprise Knowledge on ‘Why people fail to share knowledge’ ( is a good start.

My 30-year experience is that this becomes possible with the following argument – that, by paying for it, employers have JOINT-ownership of the knowledge and experience acquired during their employees’ tenure. As such, they have the right to capture and share that self-same knowledge and experience with succeeding generations of employees, a condition that can be included in employees’ conditions of employment.

Once this is firmly established then the other, more practical, issues can be addressed – whether, for example, an additional disbursement should be paid, how best to capture the knowledge and experience, how and when to share it and – to achieve the potential added value – how to ensure that both in situ employees and replacements can efficiently APPLY said knowledge and experience, otherwise known as the largely untaught skill of Experiential Learning (EL).

Inevitably, even with a contractual obligation, not all categories of employee would be agreeable or their contribution useful, for example those who might be dismissed or made redundant. But for those who leave voluntarily – and this is usually a substantial proportion of departees, all of whom are probably key knowledge owners anyway – are, in my experience, typically flattered to be asked to cooperate. Knowledge capture can be done on a regular basis, say annually, immediately after key events or just before departure.

The form of knowledge capture is another issue to consider.

The emails of knowledge owners alongside the content of employers’ data banks are customary resources but these still only reveal the explicit knowledge of an employers’ know-how that traces ‘what’ happened and when. The more valuable part of know-how is tacit or cognitive knowledge, the how of know-how that doesn’t get recorded, much of which is unwritten, even normally unspoken, but which is embedded and synthesized in knowledge owners’ heads. Different from explicit knowledge, this is the kind of knowledge that is mainly implicit, esoteric and context-, co-worker- and organisation-specific that outlines how particular organisations get things done.

How to document it is the gold standard of knowledge capture that ‘lubricates’ the explicit.

Usually what happens is that something is written by the knowledge giver or there’s a face-to-face conversation with the knowledge receiver – otherwise called ‘watch and learn’ or ‘overlap’ – but this approach has several disadvantages. Employees, including managers, are notoriously poor authors and storytellers with a tendency towards selective and defensive recall while the receivers have short memories or at least memories that can’t be recalled accurately. Their understanding of tacit knowledge is also low and, anyway, they’re both going to move on, so anything said verbally can’t be referred to at a later date.      

For this type of ‘memory’ recall, the most efficient instrument is a specialised and detailed oral debrief, optionally recorded via audio, video or transcript. The idea is not exactly new, with its origins in the traditional exit interview with departees, which is typically a formulaic 20-questions way of uncovering why employees leave. Where it differs is that it should concentrate on the unrecorded non-technical tacit knowledge to extract the important practical and management issues and decisions unique to the individuals’ job and employer. Optimally, they should be conducted by a skilful and knowledgeable interviewer, either in-house trained or externally hired, whose main quality – mainly because the knowledge has to be expertly teased out of interviewees – should be persistence and the capacity not to be intimidated by authority. These oral debriefs are then shared with appropriate incoming employees at induction time.

The process of knowledge sharing doesn’t stop there.

In situ and replacement employees need to understand that knowledge sharing is not an opportunity to repeat past experience, rather a device to APPLY past experience to their employers’ changing circumstances and environment. Educationists know this as continuous learning that, by definition, has to spring from the workplace, where so-called old experience can be transformed into new experience. In its new guise it’s called Experiential Learning (EL), the precept of which turns on the ability to constructively reflect on the past, a methodology not formally taught in conventional business education. In this particular model, the past is a more comprehensive evidential base that, in principle, will provide better decision-making, better productivity and, in the case of the UK, better competitiveness ahead of a post-Brexit future.


It is undeniable that the flexible labour market has helped to boost employment. But its use has also affected productivity, so for employers to continue benefitting from the ability to quickly adjust to changing circumstances, something has to compensate. Addressing the inevitable workplace disruption and the loss of one’s knowledge and experience is the holy grail of modern business process ….


When top managers move their jobs at the same rapid rate as the rest of the working population, the business community, business academics, even the politicians, should take note. The spinoff’s not pretty. 


The latest figures from PWC’s 2016 Strategy& survey indicate that thanks to the drop in merger and acquisition activity, the turnover of CEOs in the world’s largest 2,500 companies decreased from its record high of 16.6% in 2015 to 14.9% in 2016 but the lower rate has remained at around the same level for 10 of the last 16 years. In fact, the turnover continues to remain close to the rest of the working population in a number of mature economies that, today, change their employees every four to five years on average.

Within the survey, the regional changes are equally instructive. The median length of CEO service in the biggest 300 British businesses, for example, is 4.8 years, down 73% from 2010’s high of 8.3 years. More than 3% of British CEOs are forced out every year for ethical lapses, compared with just 9% who leave with succession plans; what’s clear is that most replacement CEOs still receive little support to adequately address their new employers’ discontinuity and institute-specific corporate amnesia that plague both their own and others’ jobs.

It’s a rate that has upturned the workplace ever since the flexible labour market introduced such high levels of discontinuity 35 years ago, when a job-for-life was not uncommon. The change has not been adequately addressed by both employers and business education alike.

However useful to employers is the flexible labour market in today’s high-change environment, the significance of this survey is that it helps to clarify several associated offsetting issues that indirectly affect the quality of their and their employers’ decision-making skills, which don’t get improved.

The first is certainly counter-intuitive. Because the CEOs are arguably the single most important decision-maker in any organisation, their determinations largely dictate the quality of their employers’ development. If for any reason they make a poor decision, the outcome of their subordinates’ determinations risk being equally poor. This ‘cascading’ characterisation is an observation that must shift much of the responsibility for poor decision-making away from coalface workers, who are the traditional scapegoats.

The second reason concerns the growing evidence of an undeniable link between flexible working and acknowledged declining productivity, which also lacks widespread acceptance. With some spikes, the latest stretch of struggling productivity scores actually coincides with the advent of flexible working.

This can be easily demonstrated. Up front, up to 12 months at each end of every replacement employees’ tenure is typically worked at lesser productive levels, which automatically reduces the period of optimum output by a significant margin. Alongside this, few of the many corporate functions within organisations ever survive without one or more employees leaving and a replacement arriving, heralding the breakdown in the way most progress occurs, organically – i.e. from the uninterrupted building of one experience on another.

Then there is the most dramatic consequence of all for the way good decision-making happens; exiting employees take with them much of their employers’ unique knowledge and experience, including their important tacit know-how, foreshadowing the onset of what’s called corporate amnesia, when businesses and other types of co-operative organisation literally lose their memory of how they do things in their own special way. In addition to constantly diluting individual corporate cultures in an unmanageable way, this combination of factors dramatically reduces the relevant evidence base with which replacement employees would otherwise need to make good and better decisions on behalf of their new employer. In effect, they end up utilising mostly the knowledge and experience of their prior employers and education, much of which is unrelated according to their employers’ unique selling point (USP) and experience and, anyway, is subject to inherent short, selective and defensive memory recall. With jobs disruption and the absence of institute-specific evidence upsetting almost every job and every employer, EVERYTHING has slowed, exactly as the productivity scores in many countries show.

Even top-flight employees become disadvantaged and CEOs are no exception, explanations for the many repeated mistakes, reinvented wheels and other unlearned lessons that now litter the modern workplace.

To address this hidden handicap, employers have to step up and provide replacement employees with a better inheritance that reduces flexible working’s inevitable workplace disruption and corporate amnesia. Then business academics have to better teach the largely absent skill of Experiential Learning (EL). And given that neither has shown much inclination to upgrade their respective roles to compensate for continual stop-start working, the politicians have to find some way to motivate them, if only to improve national productivity and their own tax receipts.


In their own interests CEOs could lead the charge – or maybe some visionary other? 


broken chain 1

If you believe small observations can signpost big, unnoticed, issues, read on …..

I recently had a conversation with the owner of a Linkedin group who thought a post I wanted to publish had a tenuous relationship with his specialist subject. My response was that there was a close association between his group and some of Linkedin’s other representative groups of knowledge management (KM), human resources (HR), experiential learning (EL) and business education, which were all referenced in my post.

I further suggested that economic history, business history and corporate history, which were also represented through a smaller clutch of groups on Linkedin, were similarly part of the one common objective of them all – to achieve good and better decision-making, itself in a devoted group.

Although an accurate accusation of being irrelevant on a dedicated Linkedin group would be justified, the lesser charge of being tenuous does provide evidence of my wider observation that the more we specialise, the more disconnected we appear to become. In my experience with initiating discussions, some groups – seemingly loyal to themselves alone – find it difficult to mutually engage. I’ve also had discussions rejected or spammed when the contribution clearly addresses a/the larger related issue.

All this might seem like ‘small potatoes’ – it is – but the observation suggests a behind-the-scenes outcome that commerce and industry’s decision-makers seem unprepared to acknowledge and unable or unwilling to address.

In Linkedin’s case, the groups don’t realise how closely related they all are but the net effect of what is otherwise familial estrangement is that they individually place themselves in so-called silos, with nary the desire to mutually commune. However much individual disciplines gets discussed, refined and/or improved, these self-imposed disconnects – I call them broken chains – serve to lessen their potential role available within the greater organisation. They illustrate how ‘more is less’, an expression that describes how, however much is being invested in today’s changed workplace, a disproportionately lower outcome results.

If my ‘broken-chains’ observation is accurate, there must be some enduring effect, difficult to pin down precisely but there’s no argument about what’s happening to productivity and productivity growth, which are big indicators that investment returns are on the slide. The fall in some geographical areas is dramatic (in the UK, for example, the current levels of individual output is at a 25-year low and almost 20% below our main competitors). Some experts think that the wider decline is temporary until the next big techno development kicks in but the edifying point is that that they don’t know why exactly. Given that the modern workplace has not fully adapted to the changed workplace environment – notably the very flexible labour market and the attendant constant migration of employers’ unique knowledge and experience – I’m suggesting that commerce and industry’s broken chains can help the explanation.  

As challenging a problem familial estrangement must be at the corporate level, the effect can be even more explicitly illustrated when the phenomenon extends to whole industries and where the net outcome is both demonstrable and deeply dysfunctional.

Witness the deeply worrying example in health care, where the soil sector, farmers, food manufacturers, the pharmaceutical and pesticide industry and doctors all operate independently of each other. The soil scientists have given farmers a nutrient-deficient way of increasing production. To compensate, food manufacturing introduces into their product chemical additives, only a small fraction of which can be absorbed by the human body, a state that inevitably compromises the human immune system. Competition has also encouraged manufacturers to further add sugar, salt and trans-fats (they call these additives ‘bliss factors’ to sell their wares), all of which have hosted a range of opportunistic diseases to fill doctors surgeries and hospitals. Into this multiple whammy happens the pharmaceutical industry, whose experts have impressively invented pills for all reasons that extend the life of many. In the First World, the result is generations of elderly people, still with low immune systems, dying uncomfortably and expensively on Zimmer frames. In the Third World, they just die.

What’s happened is that both organisational structures and industry sectors have become disengaged. The separated and interconnected sectoral specialties have, between them, all contributed to a problem now harmfully affecting the health of more than a quarter of the world’s population (source: World Food Programme, 2007). In truth, neither the individual silos nor their parent organisations would admit to any responsibility for their downstream consequences, leaving dithering Governments to try and sweep up the mess, notably futilely.

One common factor of this problem seems to be size – and size features in another meaningful example of broken chains’ upshot of ‘more is less’. Government itself is often the largest single organisation in countries with ambidextrous departments, defined skills and large budgets. Using World Bank data from 104 countries over a seven-year period to 2011, the University of Georgia’s Professor Jeffrey Dorfman, an economics specialist in how policy redistributes wealth, concluded that more Government spending means less economic growth (Forbes, December 10, 2013).

Size also features as one of the contributory factors behind the 2008 debacle around the banks, where their interconnected activities covered everything from housing to nearly everything else. It is instructive that few of the main players in that saga saw it as anything to do with the familial estrangement of connected silos, where – to quote another idiom – the separate entities ‘couldn’t see the wood for the trees’. One of the definitions of this saying is that affected entities are unable to understand what is important in a situation because they are giving too much attention to detail.

All this provides evidence of yet another knowledge-based ‘black hole’ for decision-makers and is a boost for the emerging movement known as Evidence-Based Management (EBM), which is establishing itself in medicine and some political policy-making. Studies have shown that, among doctors for example, only about 15% of their decisions are evidence based. And elsewhere, although senior executives are ultimately responsible for what happens in their organisations, the reason for lapses “could be more to do with the quality of decision-making than in any intentional unethical behaviour” (‘Decisions without Blinders’, Harvard Business Review, January 2006).

The paradox is nevertheless explicit; that despite individual heights of professional effort and/or achievement, the overall result is often less than triumphant. Forgive the opportunity to mix a few more metaphors – they are truly very good for illustrating different circumstances – but the evidence can’t be clearer, yet our ability to ‘connect the dots’ is seemingly absent. We usually describe this as ‘the left hand not knowing what the right hand is doing’ but the malady seemingly goes further; with each silo – whether at the corporate or industry level – effectively saying it’s the left hand not caring what the right hand is doing. It’s an ‘I’m-alright-Jack’ attitude that proposes that the maxim ‘big is beautiful’ is now more parody than proverb.

Behind the massive scale of these examples is an obvious breakdown in wider awareness within organisations, whether inside corporate disciplines or related-industry sectors.

By awareness, I am referring to the detail of employer-specific innovation as well as tried-and-tested knowledge and experience, important because the former is almost always a function of the latter. With the linking of the ‘old’ with the ‘new’ providing continuity and the uninterrupted direction of travel, the stop-start character of modern commerce and industry – greatly enhanced by the modern flexible labour market – is replaced by the traditional organic way most progress occurs, i.e. one experience leading into another. For ease of classification, the sum total of acquiredwisdom’ can be boxed as organisational memory (OM). Without it, the condition that is familiarly known as corporate amnesia – which is the enemy of the comprehensive evidential base – kicks in.

Thereafter comes the main reason for what happens when chains get broken and awareness takes leave – individuals and the organisations for which they work lose their PERSPECTIVE. And deprived of perspective, which is one of the most important components of good decision-making, determinations become relevant only to the short term, the acknowledged curse of much of modern commerce and industry’s inbred character (at least in many Anglo environments).

There is another equivalent classification that I hesitate to use because of its unfashionable connotations in modern business education, even in general education. Mention of the word instantly makes the eyes cloud over but it is nonetheless memory in its most durable format. Prosaically called ‘history’, its chronicle is a seriously underrated agent of knowledge/wisdom, yet its various sub-divisional applications as a management tool is widely disregarded. For one, it can help solve the endemic problem of short, selective and defensive memory recall. For two, it can fill the employer-specific knowledge vacuum imposed by short employee tenure, which is the single biggest explanation for the pervasive dispersal of unique institute-specific experience. For three, it is also key to understanding culture, the backbone of almost all collective endeavour. And finally, it can improve decision-making, whose current taught methodologies still suit old-fashioned and inflexible labour markets, where the treasure trove of the corporate evidence base didn‘t decamp the front door at today’s ‘walkabout’ rates.

I hear the leaden cry of information overload but the reality of the situation is which is preferable: the status quo or an acquired perspective? Actually, the latter is not so far from reality as its detractors might believe.

The long-term of prior experience is ordinarily the responsibility of the standalone subjects of economic history, business history and corporate history, all given seriously neglected attentions. The medium- and short-term falls more neatly into the Cinderella disciplines of KM and IT (represented by our huge data banks of inert records) while the role of learning from all their hard-won intellectual capital is decision-making’s and, crucially, the acknowledged but widely unused discipline of experiential learning (EL). Parenthetically EL, which applies knowledge and experience in a reflective methodology to adapt decisions to changed circumstances and environments, revises the taught one-size-fits-all decision-making practices to accommodate individual employers’ new short-tenure and evidence-depleted work environment. With perhaps the exception of EL, business education and employers ALREADY have these under-exploited disciplines in place.

To acquire better perspective, then, time to make them work harder in today’s changed workplace environment, whether they live down the hall, in the boardroom or even at Linkedin, where Microsoft (median employee tenure four years amid $15 billion failed acquisitions since 2001 and a high level of failed/abandoned products) has taken charge. The latter please note, perspective is precisely relevant to KM, HR, EL, business education, history and many more groups ……  


Postscript: My reference to ‘history’, which is widely unfashionable in all education, is, as already indicated, a critical component of how any culture develops itself. Culture – and no less a business culture – is especially misunderstood, its detailed awareness being essential in any attempt to manage it. But its widespread neglect as a subject raises another observation of consequence in society. Many professions (for example architecture, art, music, the military, medicine, politics, science, the clergy and so on) all contain an element of their generic history in their education, awareness that underpins their specific professionalism. Contrastingly, history’s widespread absence in business education and businesses themselves is glaringly evident, suggesting that business and/or management is not considered a profession. This author contends the contrary and suggests that a more ‘history’-savvy workforce, one that intuitively knows more about their employers’ experiences, their industrial sectors’ experiences and their countries’ business experiences within the context of even wider business experience, would automatically improve their own employment, their business practice and their decision-making. Perspective would certainly help to clear my doctor’s surgery! 



Three academics out of the universities of Minnesota and Chicago have just published some shocking statistics about financial advisers in the US. In a 10% sample of such advisers working in the decade to 2015, roughly 7% of them have indulged in some form of misconduct or fraud, with some of the largest financial advisory firms having more than 15% of their advisers with similar records of misbehaviour. Whilst the percentage of such dysfunction was unexpected – the academics were guessing a rate of around 1% – the real surprise was that offenders were five times as likely to engage in new misconduct as the average financial adviser.

For individual advisers, it pinpoints a high level of educational and ethical shortcomings and for employers, it identifies an elevated level of tolerance for misconduct, with firms disciplining only around half of offenders with dismissal. Both indicate dire levels of experiential NON-learning, which has encouraged the Financial Industry Regulatory Authority (Finra), the non-government supervisory body for the sector, to initiate a ground-breaking solution using Knowledge Management (KM), Information Technology (IT) and Experiential Learning (EL) to address even further unsettling findings.

What’s happening is that around 44% of sackings are typically re-employed by less reputable firms that have a higher rate of prior misconduct themselves, a finding that unearths another unnerving picture to further reinforce the unwelcome spin-off to retail investors. The researchers found that so-called ‘clean’ broker companies are co-existing with firms that persistently engage in wrongdoing, among them companies that “specialise” in misconduct and which specifically cater for unsophisticated customers in areas with low education, elderly populations and high incomes (source:  

With this scandalously high level of misbehaviour and tolerance for misconduct, it would appear that the standards of individual financial advisers as well as the hiring policies of employers are seriously lacking.

The evidence for these less reputable firms – indeed, even with the brokers who concentrate on more sophisticated clients – confirms the importance of a better way for investors to do their own due diligence on their financial advisers. For this to happen they need the evidence with which to become better experiential learners, where the results of the survey are being made available to investors in a trailblazing way.

Finra is recycling the information in a free-to-access databank that records so-identified “disclosures” (see of individual advisers. On a continuing basis, it will track any sort of dispute, disciplinary action or other financial matters concerning individual advisers, including fraud and other wrongdoing. It is intended that when customers get into disputes with their brokers, the results of any formal proceedings (often arbitration) will end up in BrokerCheck, as will any penalties from regulators or others. If the broker has been fired for any cause, this, too, will generally show up, as will any personal tax liens on brokers or bankruptcies that they’ve filed. Pubic access to this database will, hopefully, achieve two objectives – by naming-and-shaming individual advisers, it will hopefully deter the less-than-honest and, in the process, enable ordinary investors to make up their own minds whom to trust with their money.

Where this differs from other similar national projects is that it refers to individuals by name, thought to be a first. In the UK for example, the independent Financial Ombudsman Service publishes its “determinations” – or final decisions – of all appeals but without identifying individual advisers. Business units are identified by name whilst complainants are acknowledged by their initials.

To put BrokerCheck and other similar IT programmes into their operational contexts, they broadly fit into the prevailing discipline known as Knowledge Management (KM) and Experiential Learning (EL), the former being the efficient handling of historic data and resources while the latter is the process of learning through historical experience. Both are designed to enable good and better decisions, with BrokerCheck using explicit knowledge to provide users with an unsophisticated choice between perceived good and less good. EL, which is the more sophisticated use of prior experience, applies both explicit and tacit knowledge in a reflective methodology to adapt decisions to changed circumstances and environments, the process that is plainly behind the resolution to name and shame delinquent advisers. A good example of joint application of two of the main arms of KM, it would seem that the US financial services industry is broadening its attempt to improve its service to its ultimate customers.  

I’m a modest investor myself and my choice of financial advisers has mostly depended on personal recommendation and broker-generated hype supported by generalised, oversimplified and confusing information that is always qualified. Down the years I’ve had concerns about my own choices whose reputations are similarly indefinite, with my complaints being expertly kicked into the long grass with the statement that “The value of investments can go down in value as well as up”. Except for team leaders in one example, I was never able to locate the identities of employer-assigned individuals.

Whilst most national financial service sectors have an Ombudsman to supposedly help cut away that long grass, wouldn’t it be practical for other national regulators to similarly survey their own community of financial advisers? If the results were, like the US, equally unwelcome, might not a similar BrokerCheck be fitting? It would certainly help to make investors a little more savvy before the Ombudsman or formalised legal route needs to be taken.


Given the evident employer-allowed misconduct in one country at least, one answer must be to give investors the evidential base with which to better choose their financial advisers for themselves. In truth, BrokerCheck won’t stop all misconduct or fraud. But it is an imaginative and constructive deterrent to an evident problem. 

Posted April 15, 2016 by Knowledge Management

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