Transcript for True Compliance Innovation. How Allstate Created an Authentic Compliance Ecosystem
Nick Gallo: All right. Hello, everybody. How are you? Welcome to our webinar about driving innovation in your compliance program. I am super excited to be here with the Allstate team. I think you guys are gonna find this to be a really exciting webinar with some really great actionable information. And it’s a really fun story of a team that drove innovation and really changed the landscape. So, before we get started, I want to share our word of the day. The word of the day for today’s webinar is ambits. Anybody know what that means? This is like your SAT test here. Okay, so an ambit is a sphere of action or influence. And a lot of what today is about is about knocking down the silo walls and expanding our sphere of influence in our organization. So keep that in mind and start using that today and impress all your friends and maybe even the person at Starbucks if you can work that in.
So we are going to try to, over the next 5 to 10 years, become a better strategic asset in our organizations. We want to, like I said, knock down those silo walls and be a point of leverage for the pursuit of our organization’s mission. So I was at a conference yesterday, and the number one thing that I kept hearing over and over again…it was actually for the last two days, but the thing that I kept hearing over and over again was that, you know, we need…E&C needs to have a seat at the table and be part of it all earlier on. So whether that was for a new product, or an acquisition, or a new initiative, you know, folks need to be at that seat at the table. Because we all know what happens when we aren’t at the…when we don’t have that seat at the table, we end up living in reactionary mode.
And many of us have been living in this mode for such a long time within these complex organizations that are extremely siloed. You know, we spend so much of our time putting out fires and it’s difficult to even imagine what this new reality of de-siloed, if that’s even a word, what a de-siloed organization where E&C can be that, you know, circulatory system for the organization, and has moved from the kiddie table to the grown folks table where strategy and things like that are talked about.
So today we’re going to discuss how one team, the Allstate team who you see on your screen, really drove a lot of great innovation across their organization. And again, some of these actionable tactics and strategies that you can pull from, from their success to drive the expansion in your organization and expand that ethical ambition within your company regardless of your size. And I think what you’re going to see is that that change can come a lot faster than you can imagine.
So here’s a quick agenda of what we’re going to cover. This is not going to be a slide-heavy presentation. It’s going to be kind of a fireside chat or a conversation. So I’m going to introduce everyone. We’re going to talk a little bit about Allstate, and then you’re going to hear some high points about how they went from the Flintstones to the Jetsons, about some of those big changes that they made in their organization and then we’re just going to dive straight into tactics. So, as always, ask your questions live. We have a team of folks who will be feeding questions in. We love to weave those into the conversation and make it extremely, you know, conversational. Okay? And so, as always, I’m going to be giving out bonus points for questions with an extra special 1,000 points for the first question and the best question. Adriana, one of our panelists, she was the first one on. She’s got 1000 in her bank as well. So let’s get a little competition here. Let’s make this very conversational and so forth.
So, I want to share with you all this great quote from Harry Cletus. So he was a Roman general. And he said… He was in, you know, kind of 400 BC, 500 BC and he said, “Of every 100 men they send me, 10 shouldn’t even be there, 80 are nothing but targets, 9 are the real fighters, and we’re lucky to have them. They make the battle. But the one, one of them is a warrior and he will bring the others back.” Well, folks, I’m about to introduce to you our all-ethics warriors, all ethics and compliance warriors, and I’m extremely excited to introduce you to them. First, we have Adriana. Adriana is the privacy risk management senior manager. We have Travis. Travis is the senior managing counsel and director for the Agile Legal Teams in the Strategic Resource Group. We have Katerina, our ethics manager. We have Deb who’s a senior privacy counsel. And the one and only Courtney Welton who is the senior VP general counsel of innovation law, chief ethics compliance and privacy officer. How’s everybody doing today?
Adriana Novielli: Doing great.
Katerina Tapas: We’re good.
Courtney Welton: …thanks for having us.
Nick: Yeah, thanks for joining. So, Courtney, why don’t we start with you? Why don’t you give us a little rundown of kind of where you guys were, to go back to my Flintstones to the Jetsons analogy, talk about where you were when you came into the organization, the vision you had for the role that E&C could play in the ever-changing Allstate landscape, and some of the innovations and changes that you drove?
Courtney: Yeah, I’d love to do that. First of all, thanks. I don’t think there’s too many mornings where we get to wake up and as lawyers and clients professionals, we get to feel this cool. So whenever we do something with Nick and ComplianceLine, it’s fun, you know. So thank you. Thank you for having us. Many of you know Good Hands Allstate, just to give you kind of a little bit of setting the table. We’re a fortune 70 company. We have about 43 billion in annual revenue, 40,000 employees. Our law department size, it’s hard to say, we’re about 250 to 300 and what would be considered kind of a classic corporate environment, but we have over 1,000 other attorneys that work on claim work. So it’s a very large department, might be the largest in the country closer to 1,700 or 1800. Yeah.
So this team is really, really important to the company. We are what kind of used to be one department that never existed three and a half years ago. So I’ll talk a little bit about that. And then one that exists in probably every company, thought of mostly as your kind of core compliance group. We call those Enterprise Business Conduct for that existing team that covers regulatory compliance, privacy and ethics for the enterprise. And that’s sort of that hat that I wear as the chief ethics compliance and privacy officer. And there are people from that group on here, although we try not to think about it as silos anymore.
And then the one that I really came to the company to develop originally was innovation law. And that was really born out of the fact that Allstate was transforming, as Nick mentioned, in a lot of ways, mostly to become more focused on our customers. And customers needed to be protected in different ways, through different channels, through things even beyond traditional insurance. So we now have products and services like identity protection, we have telematics, we have roadside services, many others that you’ll hear today. So we really needed to figure out where and how to develop talent for cyber, for privacy, commercial quarterbacks who really knew how to do deals that were truly commercial-facing. So with companies like Amazon, Home Depot, you name it. And we needed to focus on intellectual property, and other parts of the law that were outside of what you would have thought of from a traditional insurance company. So that’s what innovation law was born off.
And some of the talent on this phone were people that we recruited in. Some are those that transformed their career along the way and had a lot of different opportunities at Allstate and have been here a while and really helped with the transformation over the number of years, some of them even before I was here. So I can’t wait for them to tell you their journey. Others were in parts of the law department and have been willing to transform their roles even as lawyers. So you’ve got a mix of non-lawyers and lawyers. Hopefully, that’ll help give you a diverse perspective on how we drove change and, you know, the value that we’re trying to drive for Allstate, and most importantly for our customers. So, Nick, I don’t know if that sets the table or you want to…
Nick: Yeah, it’s a great high level. I want to dive in a little bit to there was some point where the impact that your company or that your group has had and is having currently on your organization wasn’t being had, right? It was disparate and so forth. And I think, you know, you’ve kind of done a nice job of framing out, you know, kind of what the lay of the land was. Talk to us a little bit about some of… You know, so when we were talking, I kept getting this picture of “Ocean’s 11.” That you kind of brought this diverse group of folks together for this, like, awesome ethics heist. So talk to us a little bit about the heist itself, and about how some of, you know… On a broad brushstroke basis, we’ll dive into this as we get into the mindshare and the tactics of each of the folks that are on the call. But talk to us a little bit about that heist itself.
Courtney: Yeah, I mean, the biggest start to it, in some ways, was the organizational shift. But it was also changing hearts and minds about how we looked at things and taking off blinders. So traditionally, Enterprise Business Conduct at Allstate was very almost separate from even the law department, even though it functioned in law department. Katerina was in it, then so, you know, she can maybe attest to that a bit. And when those folks, which many of them were compliance professionals, went and got legal advice, it was sort of in a box like, “Here’s this issue, I’d like some legal advice on it.” Vice versa, they were out working with the business as compliance professionals, and they had their blinders on, to some extent, for what they were trying to drive.
When we took what was kind of called the traditional and old part of law department, the compliance, and then we merged it with innovation law that had never existed here before, and really was focused on change, was not thinking about things from a regulated industry perspective all the time because they were also many of those layers where people would come from non-regulated industries, tech industries, thinking about things just differently challenging the status quo. You know, what really happened is you suddenly have a scenario where both the innovation lawyers had a better appreciation for why regulated companies do what they do, and had a little more understanding of how and when you might be able to innovate or not sometimes because of regulations.
On the other hand, those who were in Enterprise Business Conduct, you know, even ethics, thought about, “Wow, maybe there are some different ways to do this. And how do we look at becoming more efficient? How do we work on embedding more effectively across all our products and services?” And Travis might be a good one to talk a little bit about this. But one thing we did was create Strategic Resource Group, again, kind of a fake name just like innovation law, we just made it up. So Travis, why don’t you talk about why we did that and what that did to break apart blinders? And maybe, I don’t know, Nick, you want to tell…he could maybe tell his story, too, developmentally of how…
Nick: Perfect. Exactly. Perfect.
Travis Rogers: Okay, cool. Yeah, the Strategic Resource Group, and you said a fake name to do something that we thought was kind of new and different, where, you know, a lot of the privacy advice we would give would often be on the backend. The business would develop an entire product, they’d come up with an entire new way of collecting data. They’d come up with a new way to share data. And then at the end of it, they’d innovate everything, they’d come up and say, “Okay, I gotta go get legal approval now, I gotta go get privacy approval. I gotta go get my stamp, right?” And then they get to the end and be like, “Oh, we shouldn’t have collected that data,” is what we tell them. Or “Oh, that’s illegal to do in the first place,” whatever, right?
And you get to the end and they get frustrated, we get frustrated because we weren’t involved. So the idea around the SRG, the Strategic Resource Group, was to bring in somebody from our group that knows this stuff early on, just like an inside consultancy, basically, like, be a part of the project team and help them design stuff, use privacy by design principles, help them do it from the get-go. And of course, that requires business buy-in to allow somebody to do that, to sit along with you on that journey. But you also have to come in with that mindset of like, “I’m not there to slow them down. I’m not there to give them a bunch of roadblocks. I’m there to help them get to their goal, right, still generating that business value. But doing it in a way that’s going to make it so much easier for them to get that final go-ahead at the end.” So we’ve built that team, you know, entirely designed it around making that stuff move faster and quicker for both us and for them.
Nick: So talk to me a little bit about that whole dynamic. Because it wasn’t just you change the signature on your email, and then automatically these guys are like, “Yeah, come on in.” You know what I’m saying? So how did you quickly kind of convey to those folks that, you know, you’re coming in as this consultant? How were you able to convey to them in a sort of effective way that, “Hey, I’m not here to slow you down. I’m actually here to be a spoiler on your car. I’m not here to be a point of drag or a point of friction.”? And tactically, how did that work? You know what I mean?
Travis: Yeah, yeah, exactly. And it’s one thing to just say it, be like, “I’m saying, I’m gonna do this for you.” Right? It’s another thing to show it. Right? So you have to show them results. That’s all it is, right? And it’s like building that trusting relationship with the business becomes so important. Because if they trust that you have their best interests at heart and you want to drive value with them, they’re gonna want to bring you in from the get-go. They want you there. They’re not even trying to push you away. They’re asking for you to join more and more things. So it’s about building that trusting relationship. And you do that by showing them the value you drive for them.
And you give them that value by explaining to them why we have these processes, why these things are important. Translating that from our language of compliance and from our language of ethics and putting it in business terms. Right? Like saying, “This is how you drive business value by utilizing these things. Like, you are going to actually be able to get more value by designing this from a privacy by design perspective from the get-go, rather than trying to jam it in on the end.” If you show them that, if you can prove that to them, then you’ve already won them over and then they start inviting you, you know, from there on out.
Nick: That’s a word that… Go ahead.
Courtney: And you could… Oh, sorry. Go ahead, Nick.
Nick: No, of course, you.
Courtney: I was gonna say I think Deb could give you some examples as well. I will tell you another strategy is definitely what Travis is talking about. But another strategy that we’ve done fairly effectively across a lot of partment in the last couple of years, is to think about what is the problem that you want to solve, either in your business, in the way that you’re working in your business, like simplification, efficiency, all of which ultimately matters for the customer, right? And then go try to solve it with a cross-functional team of smart people and show that you’ve solved something for the business. That for whatever reason might not have been a top priority for them, or for whatever reason they weren’t able to focus on it for a bit. So a couple of examples that this team drove, we worked on a personal information anonymization framework.
And Deb is an expert on that and could explain what value that’s going to continue to drive for our business. We came up with a data ethics framework. Again, both of these were run by agile teams. There were subject matter experts and others engaged, businesspeople engaged, but they really are enterprise frameworks that solve problems. There’s another one called our data clearinghouse, which some people on this call can talk about, too. So, Deb, maybe you just want to quickly talk about the value of the personal information anonymization framework, so people get a quick feel for that.
Deb Sokol: Sure. Yeah. And just go back to, you know, trying to look at a business problem and trying to find a creative solution to it, you know, in the privacy space, sometimes you’re dealing with data that you’re not sure is it personal information, isn’t it personal information. And there are a lot of situations where you really want to make it anonymized. So you want to make sure it’s not personal information, so you don’t have to worry about all of the various privacy laws. The issue was that the business would say, “Well, we’ve done all this stuff to the data. Is that enough?” And it’s not purely a legal question. So they’d come to legal, “Is it enough?” “We’re not sure.” They’d come to compliance, “We’re not sure.”
So we came up with this idea that why don’t we come up with a framework that’s basically a due diligence framework of how do you analyze this? And what do you do? And what are the steps that you need to go through to say, you go from A to Z, and when you get to Z, it’s anonymized? And we feel confident because we’ve done this due diligence that the data is anonymized. And so we pulled from…you know, it was a cross-functional team, we pulled from laws across the country, across the world. We talked to business partners to try to understand what their issues were to try to figure out how to craft it, so it made sense for a project team to go through but also met the legal needs and the compliance needs.
Courtney: Yeah, and I can tell you that Deb was a big fan of our chief technology officer, our chief data officer. Like, she solved a problem that was repeatedly taking up people’s time. And in doing that, she also better protected our customers and will continue to better protect our customers’ personal information.
Nick: So what I was really struck with or what I’ve been struck with is the clarity of purpose behind these initiatives. That you’re really targeting a particular problem, and something you said a moment ago when you were talking, Courtney, was that you have to solve these problems and then you have to kind of show them that you solved them. I think that last mile where you round third base and essentially get the credit for the problem, I think a lot of folks don’t feel comfortable doing it. Can you talk to us a little bit about how you can sort of tactfully do that without coming across as obnoxious or help folks kind of overcome whatever fear they have? You know, because we have a lot of, you know, humble people, and they know that they can’t take credit for things. But at some level, you need to take to take credit for it if you’re going to be viewed or change the way people look at you.
Courtney: Yeah, it’s a good question. I mean, I think having an agile team and having a cross-functional team, where you really have your business partners, your technology partners, everyone who has a stake in it, having somebody on the team makes it very easy to give all the team the credit, even if you’ve decided as a law department to kind of own it and drive it forward. So to me, that’s a big, big part of it. I think the other thing I want…
Nick: That’s a big point.
Courtney: One question, should we answer…? I see there’s a question here on Strategic Resource Group. Can I answer that just really quick?
Nick: Yeah, of course.
Courtney: Yeah. Okay. The Strategic Resource Group is meant to cover ethics, compliance, and legal and privacy. So while the example that Travis gave was around privacy by design, they are looking at it across all of those areas. And even more so, let’s say that Travis and his team, they’re digging in on early product and service. And part of it was something related to using gig economy workers, for example. The labor legal department does not report into my team. But certainly, Travis would then trigger for our labor department to make sure that they’re giving counseling advice to what aspects of legal and compliance might be involved in using gig economy workers. So it’s really meant to be holistic.
And it also not only is applied to, what I would call, early-stage products and services, it’s also used as we are buying companies and acquiring them. And as we acquire them, we have noticed that there are times where they do things differently than us, where they may have invested in different areas than we did. And we want to make sure that we sort of have that internal consulting to be able to make the family of companies function as one for our end customer. So they’re also engaged with our newly-acquired companies.
Nick: So thanks for covering that question. A thousand points to Kitty. Also have another question which kind of feeds into this, which is how did you obtain the organizational buy-in at the highest leadership level? Was this a cultural shift? Was there some arm-wrestling, for lack of a better term, that needed to help turn some light bulbs on at the top? How did that catalyst, you know, come about?
Courtney: Well, first of all, I’d say that, you know, ESG doing good, has been a focus of Tom Wilson our CEO and our executive management for a very, very long time. So while we have transformed some to be more digital company to broaden our products and services to meet people where they need more protection, like, for example, now we protect your cell phones and your identity online, but that core of wanting to do the right thing is definitely historically Allstate. So that wasn’t necessarily anything we needed to change.
In fact, one of the things we focus on a lot and Katerina’s our ethics expert is as we transform and we lean into hiring people that have digital backgrounds that come from diverse perspectives with companies that may have had a different background, how do we hold on to those principles that we don’t want to lose? Which has been an incredible ethics history. We’ve been on the top list of one of the world’s most ethical companies for year after year. We’re very proud of that. We work hard to continue that.
And while this team and many at Allstate, including the executive management, want to transform because we know it’s the right thing to do for our customers, we don’t want to lose those principles of doing the right thing, because it does set the good hands apart. And I know it makes me love working with everybody. Because, you know, just Allstate nice is a thing. It’s a great place to work, too. So, Katerina, maybe you could talk a little bit about, Nick, if you’d like, just how we tried to, you know, I would say mature and modernize some of our education for ethics.
Nick: Yeah, I’d love to hear about that. I’d like to… You know, if you could…the thing I was struck with when we were talking, Katerina, was you have this really interesting background. You have this sort of project management, you know, engineer’s mind, you have this yoga wellness mindfulness thing. And I’d like to talk about how you were able to kind of really bring a lot of balance to a lot of the communication innovation that you were able to drive, ultimately, the behaviors that are in line with this Allstate nice, ESG, let’s do well, by doing good outcome that we’re all pursuing.
Katerina: Yeah, yeah. So I actually came from HR within Allstate. And I came over at a time when we were getting all of the Allstate companies under one Global Code of Business Conduct. So the project at the time was, you know, let’s develop an education that will do that for everybody. And in doing that, I came over at the time because, you know, as Courtney referenced, we were siloed. Right? So I came over on the ethics team but doing annual compliance work that kind of encompassed all of it. And so, you know, at the time, we would do a lot of work, right? We were generating, you know, a lot of work. And we created this course that was sent out for everybody for annual compliance, one global code.
And over time, we came up with a roadmap or a strategy to advance our compliance, our education to respond to things like DOJ guidance, and looking ahead at what things, like, world’s most ethical company, you know, what makes people qualify for being world’s most ethical companies. And when we looked at that, we decided to, again, recreate our education. We developed a microlearning course that has a lot of different modalities. So, you know, people, we would get feedback from our employees on surveys, you know, “This is boring,” or “I learned this already.” But when we found that we engage people more with our education with things like videos, things like gaming elements in our education, and then we’re getting feedback on the service about, “This is great. This is good information. You know, I knew this information, but it’s good to have this information as a refresher every year.”
So, you know, it seemed like, you know, we learned that the value really wasn’t in having us be siloed, but in connecting the dots between the silos. So, you know, in doing a lot of work, we can generate those dots, but we also need to not forget about connecting all those different pieces. And so it was hard because, you know, there’s fear when you do new things, right? There’s fear in doing that. But in changing your behavior, there’s, like, a lot of things that you get as a benefit from that, right? You get experience, you get a story to tell, which we’re doing today. And I think we all learn a little bit about ourselves.
So that’s, you know, one of the things also is that from my yoga background, because you mentioned that, being mindful. And that’s one of the things our course attempts to get to. Like, when you’re doing something, we want you to understand the decision that you’re making. So take a pause, right, be a little bit more mindful about what you’re doing and why you’re doing that, and then go to people ask questions, right? And, you know, just know that we’re looking for people to make the right decision based on what they know, right? And it’s that gut feeling, that feeling that we have in our stomachs that tells us, you know, “If I feel a little bit icky about this, maybe I should say something to somebody.”
Nick: Isn’t it funny, though, how those feelings translate? Like, you can feel the vibe between this team. There’s a lot of authenticity on the team. And I just get the sense that everybody’s rowing in the same direction, or everybody’s climbing to the same summit on the same mountain. And talk to me a little bit about how you’re able to balance the feedback that you’re getting with, you know, the tightrope that you’re trying to walk across to, “Hey, this needs to be effective communication to drive the right behaviors. But we also need to sort of, you know, weave through these regulations or achieve these certain ends.” How do I take that feedback and balance through that?
Katerina: Yeah, so that’s a really challenging thing. Go ahead, Courtney.
Courtney: Go ahead, Katerina. I was gonna have Adriana also weigh in when you’re done, and just talk a little bit about that, how that came up as we tried to deal with the increasing pressures around privacy laws. So you answer first and then maybe kick it over to Adriana.
Katerina: Yeah, sure. So a lot of it has to do with getting input from other people. Our subsidiaries also have teams that do this type of work. So we’re not just sitting here in our home office, you know, telling other subsidiaries, “This is how we’re going to do things.” We do take out good information from our stakeholders. Our stakeholders are really good at providing that additional information that we need in order to make that the best education that we have.
Nick: Awesome. Thanks for sharing that. Adriana, what would you add to that?
Adriana: My background, I am a former auditor, and then moved into the risk management space, specifically in privacy at first and now broader to encompass ethics and compliance as well as privacy. So I was probably the least favorite person in any room or meeting that I went into. And I heard loud and clear from our stakeholders like, “Oh, another assessment, another thing we’re gonna have to do. I just want to get to the end in the finish line, and yet every time you ask a question, I have 80 more questions and responses that I need to address.”
So one of the things Courtney challenged us with doing was taking a step back, looking at our suite of assessments and the work that we do, and really challenging us to look at it differently. Keeping that consumer, that end client, whether it’s internal or external in mind, looking at those business objectives, but finding a faster, efficient way to meet those objectives without compromising and taking on too much risk. And one of the things we did was collapse and combine our assessments. We took different assessments that were focused on ethics, or regulatory compliance and privacy and said, “Let’s focus on the key risks. What are those red flags that we’re looking for? And how do we streamline that process to give hours back to the business so that they can focus on growing, and selling, and innovating, and they can get through this process a little bit less painful?”
And so we did that. We took what would amount to about 60 to 80 hours for individual assessments being performed for different ones. But if you had to do them, it would take a number of resources and hours to complete. We took those key questions, combined them, and now it’s about 8 to 10 hours in total to get through that assessment. So we’re able to allow the business to focus on what they want to do, which is their core business, but still achieving the compliance regulatory, compliance ethics and privacy risk assessments that we need to do to make sure we’re not taking on any unnecessary risks.
Nick: What a powerful, like, reframe of the ethics and compliance function, or the privacy function, or this sort of risk-mitigating function which, you know, can be a rock in the boot for a lot of businesspeople. And it’s like, “I have to deal with these people who don’t understand that I’m trying to run, or I’m trying to sell, or I’m trying to build a business,” to come through and not only say, “Okay, well, let’s assess where we’re at. Let’s see why we’re doing these things. And let’s get down to the real material questions that are going to give us the best bang for our buck.” You know, that kind of 80/20 rule. It does a massive reframe of the role itself from sort of an adversary to something that’s more an assistance or more, you know, empowering.
Nick: Yeah. Wow. See, that was great.
Courtney: And Adriana and the team can then also work on how do you remediate what you find, right?
Nick: There you go.
Courtney: Rather than just continually trying to answer questions and spin wheels. So it also helped our team focus on solutions, not just making the hole bigger, right?
Nick: So when you’re driving that… So I just love this. This is such a great picture of the broader story of knocking down silo walls when you’re knocking down silo walls between these four different assessments. Tell me a little bit about the resistance you may have felt from the different folks who were over those assessments? Did they feel like you were encroaching on their fiefdom? How were you able to sell that on the risk side? Because I’m sure the sales, so to speak, on the business side was pretty easy, because you cut out a bunch of work and it made it a lot more streamlined. But talk to us about the kind of back-office thing.
Adriana: We actually partnered with our various risk organizations. They had a seat at the table. Like we were saying earlier, we brought them into the conversation and actually included their thoughts and ideas. And they were very collaborative and supportive. They understood, when you explain, what you’re doing and why you’re trying to do it. They absolutely understood and were bought into that, but they wanted to make sure, again, those risks were assessed. But the team itself, we also had…with Courtney’s organization, we had attorneys, non-attorneys, business folks, risk partners all included in that effort.
You know, someone like Deb who has spent time…and Travis who has spent time in the business but understands the legal side, they can help create those guardrails for us. You don’t want to take on too much risk. But you know what, introducing the concept of risk acceptance or risk tolerance, where appropriate, is a great step in the right direction. The business love that because they, again, want to hit that finish line. They want to keep running and moving forward. Whereas we were seen as kind of like the people who always said no or slowed you down, as opposed to let’s just help you get there, but make sure that you’re right-sizing that risk for your business.
And then the risk and compliance partners, they were included in our effort. So they made sure they were aware and understood the changes we were making, so that it didn’t make them nervous. And I think a lot of times fear and when you feel like someone is putting up walls, it’s because they don’t understand. And once you bring them to the table, you communicate, you outline what your approach is, why you’re doing it and get that buy-in, it makes it a lot smoother. And Courtney had meetings all along in various initiatives that we are involved in. We actually call them Barrier-Buster meetings. We used her, and her title, and her exposure at the leadership to make sure that top was aligned. And then we were making sure our business partners, our risk partners were all engaged. And we would have those open conversations to say, “This is what I’m up against. This is the challenge. How can you help? How can you help get me past that line?”
Courtney: Adriana, I didn’t know that was my nickname, Barrier-Buster, huh.
Nick: I love it. I love it.
Courtney: I think… I think that’s like… I’m pretty sure that some of her peers are gonna be like, “Wait, we weren’t supposed to tell her that.” Too funny. Too funny. Let me add one thing for you, Nick. I think Adriana is getting at it. But some of this does require changing hearts and minds. And I won’t say that to be cheesy, but even within our 50, 60 groups, 60-person group, we had a lot of people who had done compliance and legal work their way for a long time. And it’s not right or wrong. It doesn’t mean their way is wrong. But it doesn’t fit where Allstate’s going and it’s not the right thing for our customers. And so we have to adjust.
And I was really lucky because the people you see on the screen and some of their peers, I have a great leadership team, an extended leadership team. And they were able to really show their peers and their team members that, “Hey, let’s give this a shot. You know, let’s see what happens.” Because some of this…like so, for example, if you used to be an ethics person, and now you’re being asked to also learn regulatory compliance, which for a regulated company means everything under the sun, every law you could ever imagine. It’s pretty intimidating. And privacy, which intimidates a lot of people given the risk levels in the country right now in cyber. And that’s scary to some people, to Katerina’s point. There’s a sense of, “Well, I used to be really good at my area and now you’re asking me to spread out to all these other areas.”
On the other hand, for your development, for your future career, for how you’re able to think more flexibly and solve problems, you’re going to develop so much faster if you allow yourself, your own personal risk, right, to get used to all those areas. And Adriana and others on this call were a big part of, “Okay, that’s a change management, communication messaging,” but they also…we put in support systems. We had over 100 workstreams around helping our staff get up to speed. Deb was one, she’s a subject matter expert on privacy. She came up with really good educational decks. And she held sessions on, “Let me get you 101 for privacy. Let me explain the principles of it.” Right? So it felt more approachable to people. And we held ourselves accountable.
We had ambassadors like Katerina and some of the other people in her group, another peer of hers, Mika, for example, she was going to go into a new role, get to do something different. But Katerina and Mika were ethics champions. They knew ethics. So when other people were new to it, they needed to go back. Katerina, as you know, has HR experience. Some of us don’t. We got to tap each other where we know. You don’t lose that because you go to another role. So we had ambassadors signed up to say, “Okay, here’s the subject matter expert or the ambassador for that area, if you feel like you’re in trouble, if you feel like you’re too far over that cliff, and you need help, and you’re not sure how to give the advice, because you got to go back to somebody who knows it a little more than you, this is who you go to.” And that speak, it’s not turning off. That doesn’t happen on Tuesday and suddenly by Wednesday, you got to be perfect at it.
So, you know, we did a ton of that stuff. And I was lucky because the people, you know, on this call and their teammates were willing to lean in and give it a try. And it took a while. I mean, I will not lie that even our own team, it took a while to get people comfortable that this was best for them, best for the company, best for the customer.
Travis: It’s a continuous journey, right? And there was efficiency dip when you first do it. Like, you have to be okay and comfortable that things are going to be more inefficient at first, right? It is not going to be as effective as the way you’ve done it for the last 30 years, right? Because you’ve been doing it for 30 years, you’re pretty effective at it at this point, right? If you change how you do it, it’s gonna go down at first, but then it accelerates and goes up. We’re starting to see the fruit of that now. Which has been really cool to see once you get on the other side of that initial transformation.
Nick: Yeah, but I think…
Katerina: I think one of the things… Go ahead.
Nick: Go ahead. I got a feeling this is gonna be smarter. Go ahead.
Katerina: Yeah, I was just gonna say I think one of the things that a lot of people are doing and have done is they made a decision to really invest in relationships, right? If you’re going to do that, there’s going to be a lot of relationship-building that was done. People were used to, like, working with the people that they normally worked with. But we had to invest in relationship building across different areas, not only within our own department, but then reach out further than that. And so you really just had to be real, right? You had to be who you are. You have to show people your true self. And like Travis was saying, you know, we were looking for progress, not perfection necessarily, but progress. Because, you know, perfection can get in the way sometimes, right? When you’re looking to get something done, that perfection piece, some people are like, you know, kind of just frozen and you freeze. Because if you don’t get it right, then, you know, what are the consequences? But some people…
Courtney: Katerina, you’re being nice. I think you want to say that lawyers are often frozen when they have to take risks.
Katerina: I’m not a lawyer, so I didn’t want to make that statement.
Courtney: I know. That was so sweet of you, Katerina. You guys can tell that Katerina is our champion for well-being. She does an incredible job with our team and has been through the pandemic, but also through our own transformation as a company as a team. You can hear even her voice, her level of calmness and her focus on making sure that our team is well taken care of. She partners with some others on our team, but we have had an increased focus on that. So I want to call that out and thank her for her leadership on that.
Nick: But if you’re putting a diverse group of people together with diverse backgrounds, and diverse skill sets, and so forth, then you’re really going to get this potential synergy that is sort of, in theory, able to be had from the group. You’re only going to get it when people feel comfortable enough to put those things forward. And to your point, Katerina, like, if there’s not an authentic relationships where people can bring their authentic selves and their authentic gifts, you’re going to get some muted version of that. And I think what’s rang through for me, as I’ve gotten to know this team a little bit is, I don’t know, the dexterity with which you’re able to kind of interact with each other. And it’s rooted, I think, down in this foundation of, you know, authentic relationships and in a, you know, whatever you called it, but as you say, Allstate nice. It’s an appreciation for the diversity that folks bring to the table. And I think that means a lot.
I’d like to answer one of these questions really quickly. And maybe this can go to Deb. And Deb, as you answer this, I think the word that really resonated with me as I’ve gotten to know you is this ability that you have had throughout your career and your experience is to straddle between the business side and the mastery side, or the SMI side, or the deep understanding of the regulations particularly in this privacy area, which is so complex and ever-changing and so forth. So if you can kind of answer this question with respect to that angle, or whatever angle you feel most comfortable. “Hey, great presentation. Privacy seems to be widely understood as risk requiring significant process and resources.
Can you elaborate on other compliance challenges? For example, the conflicts of interest. What specific strategies were used to help the business in this area? Thank you.” So maybe pull from some of your ability to straddle between the business side and the more technical side as an introduction to tackling…applying that same type of a framework to other things in this realm.
Courtney: Just thinking about what they’re asking, I think it may be helpful for you and Travis to talk about the data ethics framework and what you guys did there, because you were a huge part of that as a privacy SMI. But then we had a whole piece of that. So I think we should talk about that. And then I can finish up with giving a little discussion around how we modernized conflicts of interest. But part of that is how we deal with data ethics in our framework. So why don’t you start with one, Deb?
Deb: Sure. So yeah, so like Nick said, I’m a lawyer and currently serving as an attorney, but I also have done…I’ve had positions on the compliance side. And so I’ve been able to…you know, and I think the word is straddle. Because I’ve seen both sides of things, I’ve been able to help the business craft some solutions that pull from the law, but also are really focused on, well, this is the legal requirement, but how do you implement that? And what does that look like for the company? And is it practical? And are people going to accept it? Because I’ve had to be the recipient of that. And so one of the initiatives that I’ve worked on with Travis is this data ethics…is it called a framework or a standard? I forget.
Deb: I think it’s a framework at this point. But it’s really just a way to think about somewhat the legal requirements around just using data. And it’s far beyond privacy. So there’s things in…you know, there’s parts of it that are pulled from laws and regulations. But it’s really more about where do we want to be as a company? And how do we want to use data? And how do we maximize the use of data to really innovate and advance the company, but in a way that we all feel good about it, you know, so that it’s ethical? And so we developed this framework with those concepts in mind that were really, you know, that it’s a document and it’s a concept that doesn’t really sit neatly in anyone’s group. It’s the product of a whole bunch of different ways of thinking about things, our analytics team, our technology partners, our ethics partners, our privacy people, and the lawyers. And so that was sort of the concept and still a little bit in pilot form on this, but that was the idea behind it. I don’t know if…
Travis: I think coming from the compliance perspective, from the legal perspective, we often get mired in questions about can we do something? And we don’t often or always think about should, should we do something? So it was really about evolving from us in our roles answering, “Yes, you can do that.” It may not be the most ethical or the best thing to do. But if we just only answer, “Yes, you can do that,” are we really living into our obligations to help the company be, you know, doing the right ethical thing? So it was about moving from is it legal to is it ethical to use data in a certain way, to share data in a certain way?
And when Courtney challenged us, this was at the beginning of last year, to come up with this framework, and I raised my hand for it, but I was like, “Man, I really have no idea. What is a digital ethics framework? What am I even creating?” We had nothing in place…like we have an ethical foundation, a really nice one, but how do we translate that into the digital world? And so we just did a lot of research, a lot of benchmarking and came up with, like, these guiding principles that would say, “These are based on Allstates’ core values, but they’re translated into the digital world and how we collect data.” So it’s like trust, and fairness, and transparency, and accountability. That was like, “Okay, that’s great. Those are words on a paper, we can tell people that all the time. But how do you actually implement something like that?”
What we started to do was, okay, those are our principles, those are going to help guide us in terms of what we set up and how we answer questions and things, but let’s look around the company, and let’s look for assessments that already exist. Adriana has got those assessments that she consolidated, we have risk assessments, we have all these other things that already exist, committees that make decisions, can we embed the digital ethics principles in those things that already exist? So, like, we are not creating new assessments, we’re not creating new committees. We don’t do any of that because that just slows down the business, at least that’s the perspective, right, or the perception. Perception is reality when it comes to that. So our own guiding principle as we came up with the guiding principles was we want to make sure that whatever we identify are things that already exist, and we can enhance them with digital ethics. Right?
So then we looked at our Global Code of Businesses Conduct and put some digital ethics concepts in there. We looked at our Privacy Impact Assessment and put some digital ethics questions in there to really just start bringing that up and like, you can’t come up with a checklist to say, “Here’s all the things you can do and here’s all the things you can’t do.” Right? It’s more about the conversation and like, you get that gut feel, like Adriana talked about, right? And you look back at your principles and say, “All right, we just want to identify these issues in whatever way we can, and then use our principles to help solve those problems.”
Courtney: Well, Nick, you can see why I need, you know, and every team needs a Travis. Because he was asked to do a task that he had no idea how to get from A to Z, and he started. And he got a bunch of smart people, he was fortunate. He had a huge agile team around him, a bunch of different groups that worked on it. There were some development groups in our law department that he drew on. He went outside, benchmarked, talked to other companies, really worked with a group to come up with it. And I will tell you this, for all of the innovations that we’re talking about today, what we do is we do test and learns. We do pilots, just like you can imagine in the engineering world when you’re doing a physical product.
So you don’t go from what is the rollout enterprise framework for 4,000 employees in 23 different business units and multiple countries that we deal with, out of the gate for these types of things. Instead, Travis went and worked with our telematics unit on this and Deb, and him, and others, and they worked with what it would look like there. Then our artificial intelligence people came in and said, “Hey, Travis, we’re looking at this from an artificial intelligence perspective, how can we tie up our work together?” So, that evolved. So, you know, I just want to make sure people are always thinking about that. It feels like you’re biting off a lot, but if you start it with test and learns and pilots, you can really evolve it without putting 50 people on it out of the gate.
Travis: Yeah, you can’t be afraid to put it out there and get negative feedback or, like, stuff that’s critical, right? Because, like, that’s where you grow on it. Like, I put it out on this internet site, and I got so many comments on why would you do that? Why are you thinking this way? Like, you should change this, change that. And that’s fantastic. I love that. And that’s how it’s grown to what it is now. And it’s still not done, like, we haven’t launched it to the entire organization. And this isn’t final. It’s gonna keep evolving as we bring in more and more people and get their perspective. So this was a perfect example of, like, how to just launch something, get that out there, and start letting it evolve as you get that additional feedback.
Nick: Yeah, Lewis and Clark, you know, there was no route 66 when they explored the West. They just started walking toward the sunset. So you just have to start moving toward it. And you can start solving for outcome and feeling your way through it as long as you have some kind of a vision in mind. And I think that’s what I have found, just sort of anecdotally, that holds a lot of folks back, because there’s not that sort of worn path through the wilderness yet. But you can kind of get some sense of where you want to go. And I think this kind of feeds into, you know…
So there’s a good question here. I think you’ll kind of know where I’m trying to go with this, if I can find it. So there was a question about… Well, why don’t we start with this one and then we’ll circle to this one that’s a little bit more specific. No, let’s do that backwards. “So how are you preparing for similar CCPA laws as they roll out across the country?” You guys have done some things with some frameworks and so forth, that are almost in anticipation of things that aren’t even in place yet. So maybe you can… You know what I’m talking about now, right?
Courtney: You know, I’ll set the table and then I’ll let Adriana, who did a lot of the operational business rollout, and Deb who was the subject matter expert on it, talk a bit about it. But at a high level, our approach was don’t think about it as California or Colorado, think about it as a set of state privacy laws where the mark is moving. Right? And instead of continuing to focus on exactly what the law says, to Deb’s point earlier, break it down to what are the principles that matter in privacy? And they matter because the legislative folks out there are trying to protect customers, right? And what are those principles? Good disposal practices, good disclosure transparency practices, you name it, and we sort of built these pillars like a house.
So we had foundational aspects to our privacy program that were already there, then we had pillars of work. And leaders, including Adriana and some of her peers, took the pillars of work and drove them across our whole company. And it was one of our more effective rollouts of a large compliance program, and it continues to evolve as we ingest more laws and more requirements. Adriana, you want to talk a little bit about the program?
Adriana: Yeah, sure. And I think you hit it on the head, it was looking at it broader than just what was right in front of you, anticipating to the extent that you can of what’s also coming down the road. And so, and Courtney…we kept saying Courtney challenges. Courtney challenges us a lot, but it helps us to develop and to grow. So she did challenge us to really try to achieve operational excellence over just meeting the compliance requirements. We knew that we had to develop something that was going to meet the requirements of the law, but also live into the spirit of that law. And possibly, this would be like the icing on the cake, differentiate Allstate from others in their approach. And so what we did was created these pillars of work, these workstreams, and we said, “Let’s not just make it for one state to meet the requirements, let’s make it country-wide.” And, you know, that’s a little unpopular at first like, “Oh, I just want to do what’s required of me.”
So what we did was we met with 23 different business unit presidents, laid out the approach, got the buy-in and the alignment from each of those units. We understood their business, we listened to them, what’s going to work, what’s not going to work. Deb was involved in that work. And as she spoke to earlier, her perspective of, like, let’s not overengineer, but let’s make sure that we build something that’s gonna ensure the business can continue and make sure the end consumer is protected. Because when you’re talking about the privacy laws, that was the spirit of that law.
And I think having those meetings, open communication, getting the buy-in, and then outlining the work where we could, and where I think we were most successful is where we could implement centralized solutions. We will build it and you just need to use that centralized solutions to execute your processes. But we understood that being a large organization, sometimes that central solution wasn’t available. So you had to be agile and adapt and create solutions that worked in those situations. Deb or Courtney, anything else you wanted to add to that?
Deb: I’ll just say to answer that, you know, just to circle back to the question is that because of this approach, when these new laws were enacted and we looked at them, it’s not that we don’t have work to do, but it’s not that much work. Because we really were thinking about it, it was much more forward-thinking and thematic. And it wasn’t just so tied to the specific requirements of the one law that was already in effect. Because we knew that this is where it was going to go and it’s going to continue. So we just, you know, are building it out that way.
Nick: Yeah, I mean, you can kind of anticipate the general direction of it, especially if you can kind of deconstruct the words on the page to the ethos of it, or the spirit of what is trying to be achieved by it. You know what I’m saying? Otherwise, if you’re just doing the bare minimum, then you’re obviously going to be whittling away at this thing all the time as there’s every single move. But to your point, to the extent that you’ve been able to anticipate the direction of it, now they’re just sort of small tweaks around the margins of what would probably the middle of the fairway is or what you’ve been building.
So, you know, I want to kind of try to pull all of this together here. There are a couple of words that have kind of resonated with me. Adriana, the thing I gathered from you was figuring out where you’re at, assessing how… So what I’m going to answer here is how do we start knocking these walls down and really sort of start expanding the scope of influence within our organizations? Reframe us from this office of no, as some people call it, to a real strategic lever that helps the business solve more problems. That’s really what the name of this next decade is.
And so really kind of assessing where you’re at, and seeing what’s working, what’s not working, and being willing to not only find the materiality to kind of get that 80/20 rule, but also to be willing to shed things and do things in a new way. Becoming a master of your domain, whether that’s Deb or whether that’s Katerina with communications, Deb with privacy, Travis with just business DNA, which is a great term that I told you I was gonna steal, Courtney. I told you I was gonna start using that.
But having that business DNA and being a master of your domain helps you become this translator, right? Balancing our risks, our tradeoffs, our effectiveness with the ends that we need to achieve. And finally, straddling both the technical side and the business side, that’s really kind of the six-point plan when you can finally, you know, hit that ignition button to initiate all this change. And if you’ve been listening, we’re weaving all these words together to form my favorite, you know, I’m the acronym guy, ambits.
So you can extend the ambits of your organization, you can extend the scope of your influence by those six things: assessing, becoming a master, balance, initiating the change, translating business, technical side, and straddling both your area of expertise with the business needs. I want to pass around two quick questions as we get to the end here. The first one is what advice would you all give? Maybe we’ll start with you, Courtney. What advice would you give a new E&C program that’s just being formed to where they don’t have to sort of grow into this caricature that many of us have or fighting against, as the office of no?
Courtney: You know, start out with your mantra being you are there to enable the business and you are there to be the fabric of the business. And start with that mantra, hire people that are diverse, hire them with different backgrounds. Don’t hire all people that have historically been in compliance. So challenge that. Make sure that people who are in there have accountabilities outside that department. So they have a more holistic view of what’s happening in the company and are really able to take those blinders off and dig in and see things. Otherwise, you really become a group that’s waiting for other people to tell you what’s happening.
And reach out. I mean, benchmark, talk to people. The beauty of this area is that we should all want to do good. Do good for the world, do good for our customers. We shouldn’t be fighting each other between companies on anything related to E&C and ESG. I hope that we can all make us better at this because it really makes our products and services across the board better for customers. So reach out to people, collaborate, get help, think through ways that might work or not work and, you know, use test and learns.
Nick: Yeah, I talk about this all the time, but we’re part of this really special community that is not present in other industries or other areas of focus within our organizations. Other departments don’t have the benefit that we have for this cross-pollination or this collaboration, even across company lines. And for folks to not take advantage of that is so silly. You don’t get bonus points here or anywhere for reinventing the wheel. In the last couple of minutes here, I just have had so much fun today. I’ve learned so much. I had high expectations for this webinar, and it definitely surpassed them.
I’d like to talk to the team: Deb, Travis, Adriana, and Katerina. And I’d like you guys… You know, I get the sense that you guys would walk through walls for Courtney. I get the sense that she’s a phenomenal leader and a phenomenal manager. I’d like to take the opportunity for you to give advice to the hundreds of people that are listening right now on what it takes to be the right, best, most effective leader of their teams. What advice would you give to leaders who are in our audience right now to emulate some of the best qualities that, you know, Courtney, who’s clearly very effective, has created for your team? Why don’t we start with you, Travis?
Travis: I think we’ve talked about it several times, but building authentic, trusting relationship. And Courtney has that with each of us, all of her team. And we all trust 100% that she has our back. You can see how well she talks about all this in public, she says that to all of us in private too. And she absolutely challenges us. It is not just a nice, you know, “Go along, you’re all doing a great job,” all the time, right? Challenge, push, ask questions, make people better, but then have that trusting relationship that they know that when you’re challenging them and being tough on them, it’s because you want the best for them in the team, right? So if you can… That’s tough to straddle, right, to go between challenging, having that trusting relationship. But if you’ve built that trusting relationship upfront, people like to challenge them much more than if you have that antagonistic relationship.
Nick: Great. Thank you for that. How about you, Adriana? What would you add to that?
Adriana: Empowerment. She’s empowered each of us. She gave us her trust and her backing to make changes to have uncomfortable conversations, and to challenge the status quo.
Nick: Very good. Deb, anything to throw in there?
Deb: Yeah. I mean, I guess I would say bring your whole self and be real. We’re employees, but we’re people. And make sure that you acknowledge that the people who work for you are also people and make sure you get to know them. But you model that by, you know, letting your employees get to know you as well and really show yourself at work…
Courtney: Thank heavens we only have a minute left for Katerina, because I know I bring my whole self and all of the guys. I gotta pay them to keep it privileged. All right.
Katerina: I would say one thing that Courtney has done well that it’s good for people to emulate is to put yourself in diverse perspectives, to see things through different lenses, and know what really matters to you. Right? So if you can see the bigger picture, all those things together has really helped.
Nick: We got another acronym, CRED, C-R-E-D, challenge, empower, be real, and be diverse or be appreciative of diverse perspective. So, Courtney, last word, please share anything you can with the audience here. I appreciate you guys coming on and being so generous with your experience and your expertise, and sharing the story of innovation that you’ve driven at Allstate.
Courtney: Well, thank you for having us. I am grateful for the team that I work with. That is why we’re able to do what we’re able to do. So always, you know, find smart, wonderful humans, and you can fix a lot of problems. That’s the way the world has always worked is smart, caring people are passionate about something they change. It’s no different in corporate America, go do it. Have some fun while you do it. And I’ll just tell you, you know, we are businesspeople first if we choose to be in corporate America. And being businesspeople, you got to start out with what are you trying to solve for your customer? Based on what products and services you have, you need to think about your employees. They are your assets. They are the humans you work with that you care about. You do right by the end customer and your employees. And then, like I said, have some fun doing it. You are businesspeople, no matter what your title says. And start there and have some fun doing it and your organizations will see a strategic value. They will reward it, and you’ll make a difference.
Nick: I love it. Well, thank you all for joining us today. Thank you for the Allstate team for spending some time with us. And until next time.
Courtney: Thanks, everybody.
Katerina: Thank you.
Courtney: Bye, Nick. See you.