“Business Process Management”
The essential building block
for the 21st Century Management System
Effective Implementation of
Corporate Social Responsibility
& Corporate Governance
…..to deliver and improve what customers and
other stakeholders expect
©The HPO Group Ltd – Oct 2005
Introduction
The High Performance Organisation Group
• Passionate about ‘Business Process Management’ as a Strategic Tool
• Work with leading players to ensure ‘Best Practice’
• Challenge the ‘norm’ – seek out better value-adding solutions
• Create ‘Tools’ & Approaches that make this ‘Real World’
• Provide Online Assessment & Management System Portals
©The HPO Group Ltd – Oct 2005
The steps along the road
•Work with many organisations building process based systems
•Organisation’s asking what is CSR / CG & how do we implement?
•Worked with academic colleagues to define CSR framework based
upon systems thinking
•Established methods to assess CSR / CG effectiveness
•CSR World Conference in late 2003 to prove research findings
•BSi publish framework late 2004
•Building online CSR assessments and challenging the auditing mix.
‘We would like to share what we have learnt with you’
©The HPO Group Ltd – Oct 2005
Agenda
1. Where did we start from?
2. Business Process Management & Systems thinking
3. Corporate Social Responsibility & Corporate Governance
4. Auditing CSR – a new way.
©The HPO Group Ltd – Oct 2005
We started with ISO9001:2000
Continual improvement of the business management system
Customer
Stakeholders
Resource
Management
Requirements
Customer
Management
responsibility
input
Product
realization
Stakeholders
Measurement,
analysis and
improvement
output
Product
‘simple business model’
©The HPO Group Ltd – Oct 2005
Satisfaction
But it challenged organisations and the quality industry to think differently
Performance Excellence
CSR / CG
ISO 9001
©The HPO Group Ltd – Oct 2005
To meet customer,
stakeholder requirements
Business
Management
System
Business Process Management
‘A practical approach’
©The HPO Group Ltd – Oct 2005
Processes v silos
Dept 1
Dept 2
Dept 3
Deliver the service?
Service Design & Development?
Business Planning?
Communicating & winning business?
©The HPO Group Ltd – Oct 2005
Dept 4
Departmental - ‘silo’ thinking
Sections
/ Depts
Sales
Sales Order
Processing
Supply
Chain
Installation
KPI
KPI
KPI
KPI
95%
95%
95%
What the business sees
95%
©The HPO Group Ltd – Oct 2005
Processes - ‘Joined up’ thinking (the real world)
Sales
Sales
Ordering
Processing
Supply
Chain
Installation
Product &
Process
KPIs
What the customer & other stakeholders see
95%
90%
85%
81%
Business processes run across sites, countries and hierarchies
©The HPO Group Ltd – Oct 2005
Business Process Management
Budget
Culture
Knowledge
Asset use
Environmental
Competence
Target Actual Variance
75% 68% -7%
IT
Teamwork
Risk Mgt
Leadership
Implement improvement project
to change the process
Learn
Process thinking is not just about drawing pictures it’s
a management approach
©The HPO Group Ltd – Oct 2005
System structure Multi-level mapping
Business Management System
Owner – Most senior person
• measure business performance
• finance, customer, process, innovation
‘the what’
A process
A process
Owner - Process Owner
• measure efficiency and effectiveness
A procedure
‘the how’
©The HPO Group Ltd – Oct 2005
Training
Guide
Photograph
A Business Management System example
©The HPO Group Ltd – Oct 2005
A Business Management System example
World Leader in Testing and Certification
©The HPO Group Ltd – Oct 2005
A Business Management System example
©The HPO Group Ltd – Oct 2005
One Business Management System covering the whole business
H&S, environment
Risk Mgt
Standards
ISO9001:2000
Market forces
?
Customer
requirements
Management techniques
(technical & soft)
Regulatory requirements
System thinking is not just about drawing pictures it’s a
management approach
©The HPO Group Ltd – Oct 2005
What is Corporate Social
Responsibility &
Corporate Governance?
©The HPO Group Ltd – Oct 2005
What is Corporate Social Responsibility
•CSR is about effectively balancing the economic, social and
environmental needs of all stakeholder and then effectively delivering
these.
•Corporate Governance is concerned with complying with (local)
regulatory codes, laws etc. when running a business.
©The HPO Group Ltd – Oct 2005
CSR and management model activity
Accountability
Six-sigma
CSR
Academy
Sigma
project
Institutes
Other Standards, Models, Frameworks,
Governance requirements, Management
Techniques, Professional disciplines
related to CSR & general business mgt.
EFQM
BPM
Cadbury
9001
9004
Sarbannes
Oxley
All fighting for recognition & use = potential chaos, market confusion and misuse.
But none are wrong and equally valid when used in the appropriate place / way.
©The HPO Group Ltd – Oct 2005
Consider an ISA
Construction
Sector
FTSE 100
Shares
Bonds
Mixed
funds
Cash
Other Investment Vehicles.
ISA Management
Framework inc.
•Marketing
•Selling
•Delivering
•Fund Management
•Reviewing
Property
Overseas
Fine
Art
FTSE 350
shares
The ISA Framework manages the use of investment vehicles based upon the
customer’s attitude to risk
©The HPO Group Ltd – Oct 2005
CSR
Framework
Stakeholder engagement
Change Management
Six-sigma
CSR
Academy
Accountability
Strategic Planning
Institutes
Sigma
project
Other Standards, Models, Frameworks,
Governance requirements, Management
Techniques, Professional disciplines
related to CSR & general business mgt.
BPM
EFQM
CSR Management
Framework
Driven by:
Management &
Board
responsibility
Cadbury
9001
9004
Measurement & analysis
Sarbannes
Oxley
Managing processes, systems
& resources
The CSR Framework manages the use of standards, models and frameworks
based upon stakeholder needs and business performance
©The HPO Group Ltd – Oct 2005
The CSR Framework – from Implementing Effective CSR & CG – A framework
Stakeholders
Stakeholders
Strategic
Planning
Expectations
Managing
Resources,
Processes,
Systems
Management &
Board
Responsibility
Measurement
&
Analysis
Look familiar?……….
©The HPO Group Ltd – Oct 2005
Managing
Change &
Continuous
improvement
Impact
What drives the Business Management System?
Stakeholders requirements
Staff
Customers
Regulators
Environmental
Stock Market
Pressure groups
Supply Chain pressures
etc. etc. etc.
©The HPO Group Ltd – Oct 2005
The CSR business
management system
Delivers
Economic, Social &
Environmental results
that
relate to those
stakeholders using
expert tools
Based on ‘The systems thinking journey’ from “ Implementing Effective
CSR and CG – A Guide”
Information Mgt
programme
Corporate Supply
Profile
programme
Sarbannes
Oxley
Productivity
innovations.
Process based mgt &
Systems thinking programme
Achieving
Business
Sustainability
Or
CSR
Process based
management
Sector Specific
Programmes.
Management Development
& Leadership programmes.
Stakeholder engagement
& measurement programme
CSR/CG
programme
Health, safety
Programme
©The High Performance Organisation Group Ltd 2003 & 2004&2005
An example – Section C3 - Communication
C.3.1 – Communication Processes
The Board / management shall ensure that appropriate communication
Processes are established with all the organisations stakeholders:
-communication takes place between various employee levels…on the
effectiveness of the CSR/CG system (much like ISO 9000 clause )
But also
C.3.2 - Disclosure – The organisation shall ensure that timely and accurate
Disclosure is made on all matters relevant to stakeholders including:
-the financial and operating results
-major share ownership and voting rights
-members of the Board and key executives and their remuneration
C.3.3 – Reporting
-clearly explain how the performance of the organization
-present a balanced …contribution to sustainable development.
©The HPO Group Ltd – Oct 2005
An example – Section F
F1 - Managing the system
The organisation shall demonstrate that the CSR/CG system
includes all requirements and activities of the entire organisation
together with all appropriate frameworks, models and standards
that are being used. The effectiveness of the CSR/CG system as well
as the effectiveness of the elements from which it is built shall be
monitored and continually improved.
i.e. ISO9001 and a lot more in two sentences
©The HPO Group Ltd – Oct 2005
Other things these stakeholders may need?
Sarbanes-Oxley
Combined Code
Higgs
ISO14001 - Environmental
Sourcing Policy
CORE Bill 145
Balanced scorecard
Six sigma
Integrated Systems
AA 1000 - AccountAbility
Investors In People
SA 8000 – Social Accountability
GRI (2002) – Sustainability Reporting
ISO9001/4 - Quality
etc. etc. etc.
If each of these is led by its own specialist there will be chaos
Inside an organisation
Requirements need to be
Strategically Prioritised and Strategically Managed
©The HPO Group Ltd – Oct 2005
Implementing another requirement
Performance Excellence
New
requirement
Existing
Business Management
System
So the Business Management System grows and develops
©The HPO Group Ltd – Oct 2005
Management System Multi-level Structure
Management System
Owner - Head of Scope
measure business performance
finance, customer, process, people
Process
Owner - Process Owner
‘the what’
measure efficiency and effectiveness
Procedure/Information
Training
Guide
‘the how’
Photograph
SOX
Env.
Mgmt & H&S.
Building
Regs
©The HPO Group Ltd – Oct 2005
Higgs
Combined
Code
etc
The CSR / CG Management System – Framework & Guide
‘bulk discount available to the branch’
©The HPO Group Ltd – Oct 2005
Building a CSR Management System
Understand the CSR Framework
Building a CSR Process based
management system
CSR
Academy
Change using the experts
Sigma
project
Accountability
CSR Management
Framework
Driven by:
Support to
Aid
Senior Managers
EFQM
BPM
Cadbury
9001
9004
Online Assessments
©The HPO Group Ltd – Oct 2005
Sarbannes
Oxley
Online Management Systems
On Line Assessments
the ‘new world’ of auditing is here
©The HPO Group Ltd – Oct 2005
January 2004
The High Performance Organisation Ltd
Assessing process effectiveness- The problem-the super auditor?
Organisational
behaviour
Teamwork
Risk Mgt
H&S
Budget
Asset Mgt
Outcomes /
Results against
targets
Inputs
C
C
C
Leadership
Competence
Culture
Information
Change
security / sharing
©The HPO Group Ltd – Oct 2005
Reporting
Learn
Knowledge
Mgt
Assessing the CSR System – even super, super auditors
The market for
your products
Satisfied
customers
Government
policy
Products & services
Shareholder
value
Innovation /
inventions
Compliance to
regulations
The law & other
regulations
Outcomes / results
against targets
Environment / social
impact
Brand /
reputation
Demographic &
social changes
©The HPO Group Ltd – Oct 2005
Change
Learn
Impact upon traditional approaches
Generally
•Assessor competence?
•Numbers available / needed?
•Cost?
•Time required?
•Value already questioned
•Sufficient evidence?
•Examples of failure – Enron etc
•Sample size often small and unrepresentative
•Compliance not effectiveness focused
•Inconsistency of application and interpretation
•Lack knowledge of business & systems thinking.
‘it is not the auditors ‘fault’ they are only human
Conclusion - there needs to be other
supporting approaches’
©The HPO Group Ltd – Oct 2005
Truly ‘On-line’ Assessment and Management Solution – the mechanics
Generic
assessment
Tailored
Assessment/
define
Create
assessment
Set
up
assessment
drivers
Secure &
Confidential
User
Registration
Carryout
assessment
Monitor
Assessment
Bring about ‘real’ change to
improve effectiveness
..realising the opportunity to improve
©The HPO Group Ltd – Oct 2005
Produce
effectiveness /
compliance
report
Many thanks for letting us share our thoughts with you
The High Performance Organisation Group Ltd
www.the-hpo.com
Rob Peddle – 07957 363365
rob.peddle@the-hpo.com
©The HPO Group Ltd – Oct 2005