From organisational context to strategic plan

Why the power of insight into your risks and opportunities works to your advantage.

The new generation of ISO standards has a direct link to the business strategy and operational management. Integration of various management systems therefore becomes easier and fits in with the trend of integral management. Examples include the integration of the strategic direction of the organisation in combination with Quality Management ISO 9001:2015, Environmental Management ISO 14001:2015 and Information Security ISO 27001:2013.

From the new aspect, the Context Analysis, the standard asks to determine internal and external issues that may have an effect on the achievement of objectives. One of the most commonly used methods to analyse this information is the SWOT analysis, supplemented by a Stakeholder Analysis which identifies the stakeholders with requirements, wishes and needs in relation to the organisation. The results of the Context Analysis subsequently serve as input for the Risk & Opportunity Analysis, and as a framework for setting Objectives and KPIs.

Because of the integration with the strategic planning of the organisation, and the importance of conveying leadership, these analysis are often drawn up by the board or the management team. Organisations looking for depth in their management system also have the Context Analysis performed by managers or department heads. In this way, all facets and processes of the organisation are addressed and the input for the objectives does not only come from the ambitions at the strategic table. In time, this method will result in a structured improvement cycle in line with the strategic direction of the organisation.

KAM Consultants regularly gets asked if there is a step-by-step plan to shape this improvement cycle. There is no single answer, because there are different ways to organise it. The first and most important advice is to draw up a planning which suits the organisation and all its facets, such as the size, the time required and the space for staff deployment.

Below is an example of a planning for establishing the improvement cycle, organised for example by the KAM-coordinator as project leader:

Month 1

Form a team consisting of management and/or the MT and possibly complemented with department heads or other employees. Determine in advance whether the analyses are to be carried out at organisational or departmental level. The team makes the context analysis independently, or in groups. Gather the (internal) strengths & weaknesses and the (external) opportunities & threats plus the charted expectations of the stakeholders. Refine these analyses into a pragmatic whole. Sometimes, as an organisation, you need to work out a complete radar and sometimes only the primary facets need to be mapped out.

Month 2

Organise a brainstorming session with the management or the MT and possibly a team to spar with. This does not have to be the same composition as during the Context Analysis.  During this session, assess whether the results of the analyses frequently diverge or overlap. Include the similarities or differences across departments and processes. A risk & opportunity analysis can be carried out on the basis of the information collected. To prioritise, you give each risk or chance a value for the ‘probability’ that it may occur, as well as the ‘effect’ that would occur if it did. The result of this multiplication produces a priority list for the improvement cycle. Then, based on the context analysis and the risk & opportunity analysis, determine which (quality/environment/information security/etc) objectives plus KPIs the organisation will pursue in the coming year (or longer).

Month 3

Formulate pragmatic and suitable action points per objective and make the necessary resources available. Inform the teams about the outcome of the analyses and communicate the imminent improvements to the organisation. It is important that all employees are informed, because an informed employee is an aware employee. Time to start working on the first steps in the improvement cycle.

Quarterly meeting

During the quarterly meeting, the improvement cycle is a fixed point on the agenda and the people responsible independently assess the progress made in relation to the objectives. Where necessary, adjustments can be made and measures can be taken to keep progress going. Regular evaluation keeps the objectives in view and allows for timely intervention in case of deviations in the achievement of the objectives.

Annual consultation

By repeating this process annually and jointly analysing and evaluating the results, an organisation-wide insight into the potential for improvement of the processes is created.

By now, the majority of our customers work satisfactorily with this system. Experience shows that more concrete improvements are achieved, processes run more efficiently and the added value of the improvement cycle is clearer. It is also no longer necessary to search for relevant objectives because they present themselves automatically.