Bob Diamond, the former head of Barclays Bank, stepped down from heading the bank because of the LIBOR scandal. Essentially, LIBOR is a calculation that set the borrowing rate in the UK for different markets; for each of these markets between 6 and 20 contributor banks submit their numbers, which are then grouped and re-calculated by a third party (Thomson Reuters, acting for the British Bankers’ Association). UK banks use these numbers to set or influence various short term lending rates. While LIBOR is very important to banking, no single bank set any rate; each bank just contributes to the number. The numbers that banks contribute reflects the “perceived” rate from each bank, leaving lots of room for interpretation.  This story is still in its early stages, so we may find that many other banks were less than honest in the numbers that they contributed.

As we churn through the various scandals of the last few years, there seems to be a consistent theme from top executives: “It’s a big company, and I didn’t personally know that this was happening.” Moving over to media, we have Rupert Murdoch and the hacking scandal. Here, one of Murdoch papers (the Sun, run by his son) continues to show  evidence of government bribery, influence peddling and attempts to intimidate or control government officials. The younger Murdoch said that he didn’t know about the hacking scandal.  To take a look over at Siemens, still recovering from the global bribery scandal that started to surface almost 10 years ago. Jamie Dimon at JPMC initially characterized the firm’s $2 billion loss as a “tempest in a teapot.” Dimon also said, in a number of different ways, that JPMC is very big and the CEO can’t know everything. And he’s right.

Just for a  moment, let’s set aside the cynicism that we all have when we hear that well-paid executives missed the critical details of a financial crisis, bribery case, insider trading, security fraud or influence peddling scheme. Let’s assume that these are not cases of fraud or incompetence. Let’s assume that, at least as these issues get started, that we’re being told the truth. These are big companies and there is so much going on that it may not be possible to know everything. In part, that’s why big companies produce so many management reports. However, when I look at these management reports, they are not always that informative. What are they doing wrong?

• Presentation: Some reports have the right data, but it’s not presented in a way that is easy to understand. Perhaps a table would be more informative if it was presented as a pie chart?
• Size: Reports are too big aren’t going to be fully read. I’ve seen “management reports” that are hundreds of pages long. IF it’s that cumbersome, it’s not going to be read every week or every month. Do your report designers understand what makes a report readable?
• Duplication: Many times executives receives a lot of reports, and one report duplicates the information or the conclusions from another report. Where there is a lot of duplication, there is a lot less reading and comprehension,  and important points are missed.
• Subject: It may be a good report, but it’s not covering an important subject. Maybe it was important subject years ago, but it is no longer something that interests an executive or will lead to an executive action.
• Metrics: I’ve seen beautifully designed reports, that are well-designed and just the right size, that even hit the right subject… but that use the wrong metrics to track the issue.

Getting executive management reports right, isn’t easy. It’s hard to fight the trend of reporting what everyone else does,  instead of reporting on the things you need to know and will act upon. It’s easy to pack “executive” reports so full of information that no one ever reads it. And it is just too easy to create a report that misses the key metrics you need. When these mistake are made, executives genuinely do not know what’s going on in their firm. That’s why you, project managers and PMO directors, need to be sure that the reports your organization is creating are the right reports. Take a look at your project portfolio, when was the last time there was a major overhaul of reporting? Has anyone started an “executive reporting” project in the past few years? Your firm… every firm… spends a lot on reporting. Isn’t it time that everyone made sure that the people that run your firm are getting reports that they actually read?

Great executive reports are rare, and they are because they are difficult. However, the exceptional executive report is the best guarantee that  executives know what’s going on, regardless of how complex their operations are. This is a really big issue. The number of times we see executives in front of the Congress, the courts or the media trying to explain what went wrong in their firm is a good indicator of just how rare real transparency is in corporate America. When a firm has transparent operations, it’s a lot harder for scandals to start, and you can put the brakes on a problem when that problem is much, much smaller. At least, that’s my Niccolls worth for today!