One morning, a few Sundays ago, I was sitting on my back porch after finishing Michael Lewis’s Moneyball and I began wondering if there wasn’t something in that book that might be important to the profession of Internal Audit. I became convinced there was an argument to be made that, just as Billy Beane found new measures of success to identify talented ballplayers, so might Internal Audit look at the ways it measures success of the department and the staff to obtain better results. So I started typing away at my computer with the thought that I’d put together a quick post on the subject.
Here we sit, almost one month later preparing to delve into the seventh post on the subject, and I’m trying my darnedest to wrap this whole thing up. Yet, I feel like there is so much more to say. So much more to say because I believe some of these concepts – some of these questions about the things we take for granted about our profession (what makes it a success, what we measure for success, and how we identify the future leaders of our profession) – are the keys to our success in the future.
But I won’t try and say it all (the crowd breathes a collective sigh of great relief) because I’m afraid I may well have beaten this subject to death, beaten it to a bloody pulp, beaten it like a drum, beaten it to the punch, beaten it like a good horse on a bad night, beaten it to fit a round square into the peg hole, beaten it to heck and back and again, and beaten it to the beat of a different drummer. I fear that, much like the previous sentence, I am starting to ramble – and the subject is too important to fall victim to my wandering in the verbal desert.
Let’s just recap.
As I said, it all started with how Billy Beane went against conventional baseball wisdom in his approach to finding talented ballplayers in an effort to make his team a winner. And Internal Audit might well be served to similarly throw out some of its preconceived notions by re-evaluating how we evaluate talent.
But that immediately took us down the road of how Internal Audit departments measure their own success. The challenge (a challenge I feel most audit departments are not meeting as well as they should) is understanding how our customers would measure our success. Then, quit measuring the things our customers think are inconsequential (the first preconceived notion which needs to be thrown away) and begin measuring the things they believe are important.
From the success of the department, we move to the success of the individual, and the question of what it is we should be looking for in our audit staff. This starts with us throwing away preconceived notion #2 – that our task is to fill positions with the people who best fit those jobs. Instead, we need to find the best people and then figure how the department can use them.
Once we accept we want the best people, we then have to acknowledge that our current lists of skill sets are far too focused on the day-to-day aspects of the job. (Out goes preconceived notion #3.) This means getting rid of the same kind of measures we threw out when we realized we weren’t necessarily measuring what our customers wanted. While it is nice to have people who can write and talk and analyze and fill out the forms, the two key attributes – the two we should be looking for in every person we hire for our audit staff – are inquisitiveness and creativity.
And finally, after some in-depth discussions about inquisitiveness and creativity, we talked about the need to change the way we do performance reviews. (Preconceived notion #4 finds its way to the door.) While difficult, we need to find ways to measure and reward inquisitiveness and creativity above all those other measures we seem to hold so near and dear.
And that gets us to the end. But where do we go from here?
My suggestion: Don’t sit and talk about it, don’t debate the pros and cons, don’t philosophize while the audit shop continues to go down the road to oblivion. What do you do next? Make the changes. Make them now. Throw out notions one through four. And while you’re at it, notions five, six, seven, and however many others that have anchored your department in the wrong place. Accept that changes are a necessity – changes intended to identify real value and real talent. And, if nothing else, no matter who you are, no matter your personal situation, find ways to build and exhibit inquisitiveness and creativity.
There’s a lot of work here in making our profession more successful, and some of these concepts may seem counterintuitive. But I sincerely believe it is the only way we can achieve any real future for internal audit and, as a consequence, the way we become leaders in the business world.
(And I promise you, I’ll try to make my next post a little more lighthearted. And I’ll try to keep it down to just one post.)