“. . . Goldman itself variously described securities as ‘junk’ or ‘crappy’ or ‘s—.’
‘I think that’s very unfortunate to have on email,’ [Goldman Chief Financial Officer] Mr. Viniar said, in a remark that prompted laughter. He quickly amended that to say, ‘it’s very unfortunate for anyone to have said that in any form.’
Goldman is Bruised, Defiant in Senate, Wall Street Journal, April 28, 21010[1. John D. McKinnon and Susanne Craig, “Goldman is Bruised, Defiant in Senate,” Wall Street Journal, April 28, 2010. Online here.]
Is email mismanagement good for society?
I’ve been pondering this question as I watch the Goldman grilling.
Goldman Sachs is just the latest in a long line of organizations brought into the public square and locked in the stockade while senators flog them with damning email messages. We just watched this spectacle with Toyota, and in the last decade we watched it with a multitude of banks, communications companies, auditors, and of course, Enron.
The actors change, but the script is the same: what you wrote in email doesn’t align with what you’re telling us now. These apparently careless email messages purport to tell the real story, unfiltered by legal procedure, scripts, or slick spinmeisters.
In most cases these “smoking gun” email messages could have been defensibly thrown away years before the investigation began. There was no law or regulation requiring their retention, and most companies probably had policies mandating that they go away after a certain amount of time (for example, email messages about audits at Arthur Andersen were supposed to go away after the audit was complete).
Are Email Messages the Unvarnished Truth?
A naive – or at least politically useful – assumption underlying the whole exercise is this: what is written in email is the truth. There is a common sense logic here: what you say when no one is looking is more likely to reflect the truth.
However, this ignores the fact that the average email message in the corporate environment is loaded with subtext – the agenda of the sender; the relationship between sender and recipients; corporate politics; budget battles, and so on. We aren’t guileless automatons when we send email and scheming quislings in face-to-face communications. In fact, several studies have shown just the opposite – we are far more likely to lie in email than we are in face-to-face or even pen-and-paper communication. One recent experiment involving MBA students showed that lying increased by 50% in the email environment.[2. Naquin, C., Kurtzberg, T., & Belkin, L. (2010). The finer points of lying online: E-mail versus pen and paper. Journal of Applied Psychology, 95 (2), 387-394.] We have then, two competing theories about email and the truth. One is that email is the memorialization of spontaneous thought – that it captures raw, unfiltered truth in much the same way that a wiretap would. The other is that email is where we do our best work when it comes to lying, scheming, and manipulating the truth to our own advantage. Take your pick.
I spend a lot of time helping my clients manage email better: let’s make sure that the valuable (and legally required) stuff is kept and the garbage is tossed. The law is clear that we don’t need to keep everything forever, and there are endless business reasons for taking this approach. However, I’m also adamant that fear of the “smoking gun” should not be – and cannot be – the motivation for cleaning up and managing an email system. Getting rid of information just because you think it may be damaging in an audit, investigation, or lawsuit is plainly illegal and should never be contemplated, suggested, or even jokingly proposed with a wink. How many employees have done their employers favors by trying to clean up the past? Case after case teaches us that nobody needs these kind of favors.
In my role as an information governance consultant, I am a believer that email needs to be managed – just like any other corporate asset. To do otherwise is just wasteful and ignorant.
But, there are many folks who are likely ecstatic that corporate America has an email management problem. Plaintiffs attorneys, for one. E-discovery firms, for another. Senators too. After all, email mismanagement provides a rich pool of evidence to comb through – so good, it’s almost as if the company had been wiretapping itself and transcribing every conversation – or so it is claimed.
Email Mismanagement and Justice
In my role as a citizen and taxpayer, I am happy when the government uses its powers to uncover and address corruption – especially corruption that has massive macroeconomic or public policy implications. In that sense, email mismanagement can be very helpful to the public interest because email evidence often contains unique and useful evidence.
From this perspective, I would urge every organization on the planet to keep managing email the way you are today. Make sure you expeditiously execute on the following action items:
- it’s absolutely critical that you write a beautiful policy and then don’t enforce it
- allow employees to create PST files as they see fit
- buy some software to solve the problem, but don’t force anyone use it (the tax advantage of depreciating unused software licenses is awesome!)
- turn a blind eye to email stored on C: drives, shared drives, thumb drives, and forwarded to home computers
- make sure that IT is aware of rampant employee use of Gmail, Hotmail, and other free email services at work, but make sure they don’t do anything about it
- randomly fire some people when they do bad things in email, and let others keep their job (this is important for keeping your employment lawyers entertained)
- make sure that at least some employees are printing email to retain it
- keep a copy of every email message on backup tape, “just in case”
- make sure that you senior executives ignore any and all email policies (the courts and regulators just love inconsistency)
- if you bother to do any kind of records retention in email, make sure it is utterly inconsistent with your retention schedule and with the way you manage every other kind of data in your organization
- you certainly can’t trust employees to make retention or deletion decisions, so it’s probably easier just to have them do nothing
What’s the Down Side?
If I were a shareholder or employee of a firm in the hot seat due in part to email mismanagement, I would find it harder to see it as a good thing. Shareholder value is wiped out, jobs are lost, economic output destroyed. This is not good for shareholders or employees, nor is it good for anyone else.
The routine mismanagement of an asset, i.e., business information and records that just happen to be in an email system instead of a filing cabinet – is not a good thing and it should be be tolerated by business owners, boards, employees, or anyone with an interest in the health of an organization. Nor should it be encouraged or expected by outside parties, including courts and regulators. I’ve had discussions with attorneys in the federal government who believe that keeping all information forever is a trivial matter. “Storage is cheap,” they say. This is the attitude of someone unfamiliar with the realities of enterprise IT, and I’m not going to unpack the reasons this doesn’t work today.
What is the Real Impact of Email Mismanagement on Justice?
In addition, email mismanagement is a clear threat to justice in civil litigation. The unnecessary retention of information causes an almost criminal waste of money and time in big cases. We recently completed a study that found, in a multi-year litigation involving terabytes of information, nearly 70% of all the information preserved, collected, and reviewed was junk, i.e., information that the company could have legally tossed years before the litigation began. The hard cost of rampant information mismanagement in just this one big case (one of dozens for the client): over $10 million. Email mismanagement results in millions and millions of dollars being thrown away, providing no value to the institution in return. Aside from the money, is getting to the truth of a dispute easier or harder when both sides are wading through millions – or even billions – of irrelevant email messages, documents, and assorted business junk?
So, is email mismanagement good for society? I guess the answer depends on which end of the telescope you’re looking through. On balance, I think not. But, I hope that at least some of you disagree and continue to ignore email management. After all, headlines like the ones we saw last week help to put food on my table.