What is pencil whipping?

Pencil whipping can happen in dozens of ways, from too-quick website signups to thoughtless sign-offs on invoices. Anytime a person at your company has the job of signing off on a form of some kind, there’s a risk that they’ll pencil whip it without reading all of the fine details. The longer and more complex the document, the more likely it is to get pencil whipped.

Today’s workplace is full of opportunities for pencil whipping to occur. Office staff may have to log into a website with the company’s credentials, and part of that process might be to read and accept a long terms and conditions document. Warehouse and office managers frequently sign invoices for goods received, or for expense reports submitted, that can include missing parts, overcharges and wrong items. Arguably worse, your company’s hiring managers might be tempted to speed through a resume or application and approve a candidate for the next round of hiring when they should have been screened out.

The danger of pencil whipping

This can be a serious problem for your company. Terms and conditions are enforceable legal agreements that bind the signer to certain limitations. Your company may be asked to agree to non-disclosure agreements or specific terms to hold a bank account. The fine print on your company’s credit card agreement might include unwanted fees and penalties. Pencil whipping a job application might leave you with an employee who should not have been hired, which creates a hazardous situation for areas stretching from customer privacy to jobsite safety.

Areas that are likely to get pencil whipped

So many areas of business require a pro forma agreement that it’s possible for pencil whipping to crop up anywhere. Pay especially close attention to employees’ online activities, since setting up company accounts usually requires an agreement of some kind, and the temptation is always to cut corners with pencil whipping. Examples of online pencil whipping include:

• Agreeing to a site’s use of cookies, which can compromise your data security policy
• Agreeing to disclose information that will be sold to unknown third parties
• Agreeing to fees or other costs for using a service, such as the high fees for some stock image websites
• Agreeing to adverse legal structures, such as an unfavorable arbitration requirement, as a condition of using a service or social media account

The internet isn’t the only place where people working at your company might slip and start to pencil whip important documents. Paper documents provide plenty of opportunities for this to happen, too. While it may not be a big deal for an office manager to mistakenly sign off on a delivery of printer paper that was actually short one box, the same bad habit can result in erroneous approvals of overtime, sick leave, hours worked and payroll corrections. Pencil whipping a schedule can move employees to shifts they didn’t sign up for. Doing it to accounts receivable can result in undercharges or overcharges, which can potentially create major liability.

Pencil whipping may increase the risk of phishing attacks

Phishing is a practice in which individuals are unknowingly tricked into providing sensitive information such as login credentials, account numbers and other personal data. The most common type of phishing is via email, when attackers pose as trusted senders in order to access financial accounts of the recipients. If an employee has a habit of pencil whipping, they could put your company at risk of phishing attacks by hastily opening fraudulent emails and clicking on malicious links. This can lead to serious security issues such as identity theft, financial theft, and leaking of sensitive information.

How good companies sign bad papers

It’s safe to assume that none of this is being done on purpose. Almost by definition, pencil whipping happens when an employee acts with negligence, not malice. The consequences for your company might be the same as if you had staff members committing deliberate fraud, but you can’t prevent documents getting pencil whipped by just hiring honest people.

Instead of suspecting ill intent as the source of this problem, it’s more productive to go looking for the systems and policies that make pencil whipping more likely to happen. There are a lot of things that can increase the odds of this, and every manager has to look for danger zones particular to their company. Some of the more common structures that make pencil whipping likely include:

Overwork

It’s sad but true: tired workers make mistakes, and stress hurts motivation. It’s far more likely that employees with long hours and demanding duties will overlook some fine print and sign off on documents than it is for fresh, motivated people working a reasonable shift. It’s an unfortunate coincidence that the employees most likely to work long hours—salaried managers—are also usually the people responsible for signing the company’s documents.

Vague job duties

It’s inevitable that some workers will have an unclear idea of where their job starts and ends, and this can lead to employees pencil whipping documents they really aren’t supposed to be responsible for. So, an inventory manager might wind up approving an expense record for petty cash or a field supervisor might improperly sign off on a mileage report. Such things happen, but they often cause delays and force corrections when they do.

Too many cooks

A lot of workplaces have large numbers of people who can do various jobs, such as answer the phone or check supplies out of the cabinet. This atmosphere can create trouble, however, when too many workers have the authority to pencil whip a document. A customer service supervisor, for instance, may be a team lead with certain responsibilities, including signing employees’ performance evaluations. That same supervisor may create a shortfall or a liability if the division’s policy allows them to sign off on vacation requests without consulting operations or to receive new office furniture for their team members.

Company culture

It’s never comfortable to assess a company’s culture for shortcomings, but it’s a factor in pencil whipping. Adequate training and awareness of the danger is part of the solution. It’s also a good idea to foster a general attitude of caution and accountability for actions, even if the breach doesn’t cause harm the first time it happens. A lax attitude from upper management almost always trickles down, and it can promote cutting corners and carelessness.

Moving toward a pencil whip-free company

It’s up to management to stop pencil whipping before it becomes a problem. Think about incorporating a few of these policies to create a smarter, more careful and, above all, pencil whip-free company:

• Designate a single manager to sign important documents
• Train all employees to refer signatures upward
• Create a single channel for incoming documents and online requests, and review performance quarterly
• Implement test phishing attacks on all digital forms to ensure all company and employee data remains secure
• Restrict the ability of company computers to be used for personal or unauthorized business
• Single out and reward people who catch mistakes before they happen, and educate others about why pencil whipping matters