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Mind of Jacka: Fear Itself

Blogs Mike Jacka, CIA, CPA, CPCU, CLU Jul 19, 2023

While reading research on “construal theory” (and, boy, have I got a blog post planned on that one), I came across this definition:

Fear is an emotional state that arises as a response to a negative, uncertain situation appraised to be not in one’s control. 

Internal auditors face many different responses when we intrude into the client’s territory. If things are going well, we might be greeted with open arms or, at least, arms hanging loosely to the side with fists unclenched. But we often face passive-aggressiveness or downright aggressiveness — responses that show the walls have already been established between the aggressor (us) and the defender (the client).

Those responses come in many flavors: anxiety, silence, verbosity, evasiveness, immobility, lying, etc. Here’s a checklist. How many of these have you encountered at the outset of an audit/meeting/interview/test?

“I don’t have time.”
“I know what you’re trying to do!”
“Go talk to someone else.”
“What do you want?”
“You need to audit there instead of here.”
“I’m sorry, we’ll have to reschedule that meeting.”
“You already think you know everything.”
“….” (Imagine the client just staring, not saying anything.)
“I’m so glad to see you” (This last is said in a tone dripping with irony or insincerity.)

Some of these responses can be legitimate. But there is a unifying emotion underlying most of them — they are rooted in fear. This may not be completely evident, and you may not think that fear underlies your clients’ reactions.  But remember that there are four basic responses to fear — fight, flight, freeze, and fawn — and each of the responses listed above represent the variations inherent within those four basic reactions.

We spend a lot of our time trying to address each of these issues as they occur. But that is only curing a symptom. As we all know, we ultimately want to cure the disease, not the symptom.

That disease is fear. And to address that disease, we need to understand it. That is why a definition is so important; it gives us the causes of the disease, which we can then use to overcome it. So, let’s dissect that definition.

First, fear — in any of its forms — is an emotional state. Research shows that attempts to combat emotional responses with logic are seldom successful. As internal auditors, we tend to fall back on logic, which makes our attempts to quell fear that much more ineffective. Instead, we need to back up and understand the fear that is causing these reactions — not to talk the client out of them — but to understand and address the emotions involved. Once everyone gets their emotions under control, then logical discussions can follow.

Next, the definition explains that fear occurs from “negative, uncertain situations." You might want to believe your audit department does not come into any operation with the cloud of negativity hanging overhead. But, even in the best of situations, that isn’t true. At Farmers Insurance, we had incredible relationships within the organization. But that didn’t include everyone, every time. In fact, some of the client quotes provided at the outset of this piece are ripped from the headlines of “Farmers Internal Audit Meets the Client!”

Even in the best of situations, the negative connotations related to internal audit hide in the shadows. And there is almost always uncertainty. Who, what, why, when, where, and how — all the reporter’s favorite questions are rushing through the client’s mind. “Why are they here?” “What are they going to do? “Didn’t they just audit us?” And so on.

We have to determine the fear-based questions that are going through the client’s mind. (And neither you nor the client may recognize these as fear-based, but they are.) We have to root them out and address them as quickly as possible.

But that is still addressing the symptoms, rather than the disease. One solution is to placate uncertainty and negativity well ahead of time — letting the clients know who we are, what we are doing, and why they should care. Of course, that is one purpose of the kick-off meeting. But, again, that approach only treats the symptom. More important is how the client has been handled in the past. And not just in past audits, but by keeping them updated and involved in internal audit’s work throughout the year. In our internal audit department, we called them “relationship management” meetings, and we used the time to learn about the clients, help them understand who we were, and try to answer the questions that might come up at the beginning of an audit — all done well before the pressure of an actual audit reared its ugly head.

Meet with your potential clients (even your non-potential clients) well before any audit work. Even if you don’t think you’ll ever visit an area, hold the meetings. One, you never know when that individual might move to a department where audits are planned. Two, you never know what audits may occur in the future.

And then there is the final piece of the definition: “not in one’s control.” When we show up to conduct any review, the clients can easily feel they are out of control. It’s our audit, not theirs. And they want to take control of the situation. This leads to responses like, “Go talk to someone else,” “I’m sorry, we’ll have to reschedule,” or “I don’t have time.”

Again, at the outset of any audit, the best approach (once the emotion of fear has been addressed) is to explain the need for the audit, the risks involved, the schedule, or even our desire to work as partners. But that may not be enough. We should also be willing to cede some control to the client. You can’t reschedule/cancel the work. But you can help them understand what needs to be done, while allowing them a role in determining what gets done, how it gets done, and when it gets done. Note that this is a role in the decision, not making the final decision.

And now, scroll up and read a few paragraphs back. Because, again, the disease is fear and the loss of control. And, if we can have (multiple) meetings/discussions/friendly conversations about what we are doing and how we are counting on the clients to accomplish it — giving them some power and control — then the walls will come tumbling down.

It should be evident from the above that, as so many people continue to preach, soft skills are more important to an internal auditor’s success than hard skills. And I guess I’d say that, of all the soft skills, the most important is relationship management. Of course, that term in and of itself is a catchall because it is made up of communication and empathy and collaboration and networking and learning and adaptability and ethics and …well, you can find all this under the category of emotional intelligence.

The final upshot is this. With an understanding of how fear impacts others and the relationships we are trying to build with our clients, we need to recognize that reactions we never thought of as being rooted in fear actually owe their existence to that emotion. We have to understand where that fear comes from and then take steps well ahead of time to control that fear.

Mike Jacka, CIA, CPA, CPCU, CLU

Co-founder and Chief Creative Pilot, Flying Pig Audit, Consulting, and Training Services (FPACTS), based in Phoenix.