Organizational Audit General Results Term Paper

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Organizational Audit

General Results of the Audit

The audit studied the way that productivity management is handled at InforMed, and evaluated some of the base systems that aid in making productivity improvements. On the whole, InforMed has many of the tools at the departmental level to manage productivity effectively. They hire good people, and in theory at least grant them the autonomy required to make improvements. However, we found that there is no overarching corporate strategy for productivity improvement. This essentially squanders the tools that they already have. Decisions are made on an ad hoc basis with no concern for the broader needs of the organization. Neither departmental managers nor front-line employees have any impetus to pursue productivity improvement. Worse, there is no system for productivity auditing in place. Many functional departments have the capacity to gather raw data, but there is little analysis conducted. These leaves managers in the position of having little idea of what initiatives are needed, what the areas of weakness are, or how to evaluate the changes that have been made for deviations or effectiveness.

Analysis of the Audit - Policy

InforMed scored moderately well on policy, hitting five of seven key components to strong productivity policy. The company does well in terms of empowering its employees to make their own decisions regarding productivity.

Employees at all levels are involved in decision-making about their jobs, and each is held accountable for whatever productivity efforts are delegated to him.

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The corporate power structure supports this. Productivity management has been built into the structure at all levels - every key function for productivity management is present. In addition to each employee, each department bears the responsibility for its own productivity improvements.

At the overall corporate level is where InforMed's productivity management program becomes weak. While the company does have a productivity mission statement, and it is given priority by management, the controls necessary to follow through on the mission statement are often lacking.

Term Paper on Organizational Audit General Results of the Audit Assignment

For example, while superficially each department is responsible for its productivity improvement, there is no oversight. Managers do not submit plans for improving productivity to senior management nor do they report productivity results. InforMed lacks an overall strategic plan to address the issue of productivity, and therefore there is no plan to integrate the productivity strategies of each department into the broader plan for the company. Not only do they lose opportunities to learn from each other, but this evidences a lack of concrete support from senior management. Because there is no overall plan and no reporting, there is no evaluation. This results in a system where productivity improvements are ad hoc, not shared through the organization and not evaluated for any sort of strategic fit.

This marginalizes whatever productivity gains that are made.

So while the tools for strong productivity management are present at the lower levels, there is no guidance or supervision at the higher levels. The program lacks cohesion and direction. Worse, it sends the wrong signals throughout the organization about the importance of productivity management. It is not use for employees or departments to make productivity improvements if the company neither knows about them nor recognizes them, let alone integrates them into a broader, organized productivity improvement platform.

Leadership

Productivity leadership at InforMed is poor. Without the guidance that a proper productivity policy would give, management essentially ignores productivity in their day-to-day work. Foremost, management does not demand any productivity performance audit. Ideally, they would emphasize the importance of tracking productivity within the organization. However, they do not. There is no periodic productivity audit and no annual productivity report that is compiled and presented to measure productivity improvements over the year. Not only does management not know what is happening in the company with regards to productivity, they do not care.

Moreover, the systems for managing productivity are basically non-existent. Employees are neither encouraged nor challenged to improve productivity. Leadership seldom if ever promotes improvements in their employees. For example, InforMed operates a call center to support their products. This is one of the best environments in which to encourage productivity improvement because the tools for measuring the effect of new ideas are readily available. Even given that, management ignores the opportunity to engage their employees with regards to productivity. They prefer a focus on "service," not realizing that service and productivity are not at all mutually exclusive.

Teamwork is not emphasized, reducing opportunities to generate and implement better productivity-related ideas. Moreover, there is no system to reward employees for the contributions they do make. So while employees are empowered to help shape their jobs, they are not encouraged to improve productivity; such gains are not recognized when they do occur; and there is no reward system to provide incentive to address productivity issues. Moreover, from what we can determine, management still places priority on personalities over ideas - they favor the views of their favorite employees or those in certain positions, rather than evaluating new ideas strictly on an independent basis. This not only reduces the opportunity to tap the knowledge and experience of a wide swath of their workforce (most of the call center, for example) but is incongruous with the degree of input they give employees in terms of shaping their own jobs.

Yet leadership does encourage research and development. They structure work flow so that each department contributes a balanced effort. The work environment is harmonious to some extent, yet because productivity's contribution to overall strategy is not explicitly outlined in policy, it tends to be an area ignored by management.

Objectives

Productivity objectives are fairly clearly defined at the department level of InforMed. Employees generally understand what is expected of them in terms of output and goals set for each period of time. Moreover, these expectations are attainable, and provide some challenge. Employee performance in most departments is measured, sometimes to a fine level of detail.

Normally, that would form the groundwork for a strong productivity management program. However, beyond the department level there is little support for productivity initiatives. So while most employees are aware of the objectives set for themselves and their department, senior management seems unaware of how to integrate these into a broader productivity program.

Measurements are made, but this is where productivity management stops at InforMed. Managers, for example, do not have specific productivity objectives passed down from above.

Worse, the company as a whole has no system to measure the effectiveness of whatever productivity measures it implements. There is nothing in place, for example, to measure variances from objectives. They have the capacity to achieve such measurements in many of their areas, but they do not have the focus to actually do it. They have little sense of when one of their productivity plans goes wrong, and when it does they appear to have no particular sense of how to identify the problem and rectify the situation. This leaves InforMed in a position whereby they have no system in place to spearhead change, meaning that any changes are ad hoc and on the department level or lower. Then when something goes wrong and the change does not work as planned, they are lucky if they know and even then have trouble identifying the source of the problem so that they can fix it.

Inputs

In terms of inputs, InforMed scores in the middle range. Some of the base structures needed to manage productivity are present, but the company struggles with the finer details. At the base level, each department has control over its own budget. This allows them the autonomy to manage their own productivity. Flowing from this, job specifications are clearly defined, which provides the basis for productivity measurement. Resources are made available to each department on a timely basis, which gives each department ample opportunity to management their productivity without delays caused by inadequate purchasing.

However, despite each department having control its own budget, they typically do not break their budgets down to individual inputs. Senior management knows that they are spending money, but they do not necessarily have a clear picture on what they are spending that money. InforMed does not have a sufficiently robust information system to monitor resource utilization. This leaves much of the power for productivity management in the hands of department managers, who as we have established do not have any responsibility to senior management on productivity issues.

The quality of inputs is not measured against the quality of outputs. One key way of viewing productivity is that good value for dollar must be achieved. There is no consideration of the value of inputs vs. The value of outputs. If there was, the company could benchmark relative improve of outputs even as inputs vary.

Performance

InforMed scores well on its ability to establish and measure performance of each department. Its employees receive sufficient training to perform the tasks that are expected of them. Within each department, goals for employees are set in line with department goals. The goals set are designed carefully… [END OF PREVIEW] . . . READ MORE

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