How to share your workload under the SMCR

There was apparently a sign on former US president Ronald Reagan's desk which read: “It’s amazing what can be accomplished by any person if he doesn’t care who gets the credit."

How to share your workload under the SMCR

27 Feb 2020

Graeme Stewart

Most books on good management practices take the view that it's good for the business as a whole to have managers who properly delegate their work.

It not only empowers people in the organisation, but also serves to spread the workload to the appropriate people.

So where does this fit in with the senior managers and certification regime (SM&CR)?

Senior managers are well within their rights to delegate some of the work and activities they have taken responsibility for, and that are described in their statement of responsibilities (SORs). But this needs to be approached in the right way. 

What the rules say

The SM&CR actually has quite a lot to say about delegation, and what the regulatory expectations are.  

In the second tier conduct rules, which apply to all senior managers, there are two rules that appear to address the issue of delegation.

These should be read and understood before any delegation starts.

Senior manager conduct rule 1 states: 

"You must take reasonable steps to ensure that the business of the firm for which you are responsible is controlled effectively."

This seems to be an endorsement for proper delegation. 

Allocating tasks and responsibilities to the appropriate people within an advice firm would seem both a 'reasonable' step to be taking and an 'effective' way to control business.

Yet senior manager conduct rule 3 says:

"You must take reasonable steps to ensure that any delegation of your responsibilities is to an appropriate person and that you oversee the discharge of the delegated responsibility effectively."

This seems less of an endorsement, and more of a threat!

Going back to our political quotes for a moment, it was former US senator Byron Morgan who said:
“You can delegate authority, but you cannot delegate responsibility.”

This sums up the SM&CR position nicely.

Delegation can be a positive thing for a business, but firms need to bear in mind that while authority and activities can be delegated, the SM&CR clearly indicates that responsibility itself cannot be delegated.

The two key points here are contained within the rules themselves. 

Delegation of a task or authority should only be:

a) assigned to the right person - that is, someone who has the knowledge, skills and experience to undertake the task competently; and

b) where there is a robust oversight process in place - that is, when the responsible person has clear oversight of the activity being completed, and can also evidence that oversight.

The right approach to delegation

If a senior manager is to delegate some activities, it's worth considering what can be done with the time saved, and whether the trade-off is a good one.

Example 1

Let's take the example of a senior manager who's responsible for completing and submitting the firm's Gabriel returns.

Clearly, this is a very important responsibility.

The returns need to be accurate and on time, and failing to report properly may attract unwanted FCA scrutiny.

So, the number of hours saved by the manager not doing this task is X.

If these hours were instead used to develop and grow the business, perhaps through developing professional connections, that might be considered a good trade-off for the business.

But if the X numbers of hours were used to do other, less important, number crunching exercises, is that still a good trade-off?

Example 2

Let's look at another example: a senior manager with the prescribed responsibility of “performance by the firm of its obligations under the certification regime."

This person has devised the certification process being used by the firm.

As part of that process, they will prepare the key performance indicator data as part of the competence and capability assessment.

This will happen ahead of one-to-one meetings held with advisers as set out in the firm's training and competence plan.

The senior manager delegates the task of assessing financial soundness, honesty, integrity and reputation which are carried out before individual certificates are issued.

Another person is delegated the task to carry out the one-to-one meetings. The output of this is then reviewed by the senior manager, who will in turn issue the certificate.

If that process works well, it's a case of "if it ain't broke, don't fix it". 

But it may be worth thinking about whether the delegated tasks in this scenario aren’t actually slowing the process down, and/or leaving it open to inconsistency, misunderstanding and duplication.

In some cases, tasks which have already been delegated may need to be taken back by the senior manager if it will lead to smoother and more robust outcomes.

Of course, any time added to the senior manager’s role may need to be offset elsewhere.   

Overall, try to consider what tasks are being done by the senior manager(s) and which tasks, if delegated, could make a positive difference if they were completed by someone else through a robust delegation process.

Don’t be constrained by thoughts of “how things have always been done”, and try to be open to changing things as required.

Some people can feel threatened by change, but don’t fall prey to the idea that just because a person has been doing a task well, it couldn’t be done better by someone else.

Closely reviewing the statement of responsibility should tell you which tasks might be worth delegating. 
In our next article we'll look at who tasks should be delegated to, and go into a bit more detail about what good delegation looks like.