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Controls creating complexity?
A recent post at Harvard Business Online makes an interesting point: Lots of controls rise from incidents that have already occurred, even if there is little chance of an exact repeat of the original problem. This applies at a grand level--Sarbanes-Oxley is seen by some as grand overreaction (Sarbanes-Oxley news).
You likely have experienced something like this at your company. A problem crops up, some manager gets irate and vows it will never happen again, and some ill-conceived new process gets inaugurated. So perhaps it would be a good idea to heed the poster and take a step back periodically to check up on your after-the-fact solutions for three common problems. 1) Static controls for dynamic problems: Static controls, especially if embraced in haste, can easily build to the point where they cannot all be implemented at once. 2) High costs: It may be that the cost of the control is way out of proportion to the problem being addressed. 3) Misapplied controls: Too often controls become blunt instruments that are used to tackle dissimilar problems, vastly reducing their effectiveness.
For more:
- here's the Harvard Business Online item
Related Articles:
Finally, the Supreme Court takes up Sarbanes-Oxley
Sarbanes-Oxley and IPOs, the great excuse
These men want to takedown Sarbanes-Oxley
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