Large scale corporate transformation

Large scale corporate transformation are the necessary actions required to increase performance in an organisation. It leads to greater performance results and greater organisational growth. It is a lasting change and can range from getting new leaders to combining the functions of different departments. It can also involve the introduction of a new phase in the life of an organisation. Large scale corporate transformation can be measured using three variables. The first variable involves determining how deep the change penetrates to all levels of the organisation. The second variable measures how entrenched it becomes in the organisation while the third measure determines the percentage of the organisation covered in the change.

Corporate transformation is essential for a company that seeks to have a greater impact and a longer life in its business sector. The process requires time and resources. The whole establishment needs to support it for success. Not only does the top management need to back it, but stockholders and staff members also need to buy the idea. This is because when the process of corporate transformation hits a barrier, it will take the entire organisation to keep it on course and complete the process. Without the support of everyone, most organisations will not complete the process.

Business transformation in recent times has begun to combine finance, HR and IT departments into one functioning piece of an organisation. This has resulted in leaner, faster, and more efficient corporate entities that produce high results and has a greater impact in its overall functioning. These three key departments are the backbone of any organisation, and the combination of the three creates an efficient organisation that translates into high performance results.

One crucial aspect of large scale corporate transformation is IT transformation, which entails the entire overhaul of any organisation’s technology systems. It adopts a more efficient platform that enhances its overall operation. IT transformation involves the use of Service Oriented Architecture (SOA) and open systems. This process is the revamping of the existing technology used to support the organisation and is critical for aligning the business functions to the mission of the organization. It touches on the current hardware and software and how they can best be improved upon for greater results. This process is necessary in the entire business transformation.

The question that needs to be addressed is how any organisation can make this process successful. First, it requires the understanding that it is not just a goal to be achieved, but a new way of thinking embraced by the entire organisation. Secondly, the leadership in place needs to be fully involved and dedicated to the process and to realise that it takes time and effort to complete such a mission. There also needs to be flexibility and adaptability in order to learn from mistakes and keep moving forward. Constant communication is also critical to ensure that everyone involved understands the current stage and the next steps to be done. Change is the only constant and is necessary for progress and success.

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Spreadsheet Risks in Banks

No other industry perhaps handles such large volumes of critical financial data more than the banking industry. For decades now, spreadsheets have become permanent fixtures in the front-line reporting tool sets of banks, providing organised information when and where needed.

But as banks enter into a period of heightened credit risks, elevated levels of fraud, and greater regulatory scrutiny, many are wondering if continued reliance on spreadsheets is a wise decision for banks today.

The downfall of Lehman Brothers which eventually led to its filing for Chapter 11 bankruptcy protection on September 15, 2008, served as a wake up call for many institutions across the globe to make a serious examination of their own risk management practices. But would these reforms include evaluating the security of user developed applications (UDAs), the most common of which are spreadsheets, and putting specific guidelines as to when they can – or cannot be – used?

Banks and Spreadsheet Use

Banks have been known to utilise spreadsheets systems for many critical functions because most personnel are well-acquainted with them, and the freedom of being able to develop customised reports without needing to consult with the IT department offers flexibility and convenience. In fact, more than having a way to do financial budgeting and analysing customer profitability, even loan officers and trade managers have become reliant on spreadsheets for risk management reporting and for making underwriting decisions.

But there are more than a few drawbacks to using spreadsheets for these tasks, and the sooner bank executives realise these, the sooner they can adopt better solutions.

General Limitations

Spreadsheets are far from being data base systems and yet more often than not, they are expected to act as such, with figures constantly added and formulas edited to produce the presumably right set of reports.

In addition, data integrity is always a cause for concern as most values in spreadsheets are entered as manual inputs. Even the mere misplacement of a comma or a negative sign, or an inadvertent ?edit? to a formula can also be a source of significant changes in the outcome.

Confidentiality risk is also another drawback of the use of spreadsheets in banks as these tools do not have adequate?access controls to limit access to only authorised individuals. Pertinent financial information that fall into the wrong hands can lead to a whole new set of problems including the possibility of fraud.

Risks in Trading

For trading transactions, spreadsheets can prove to be of immense use – but only for small market volumes. As trade volumes increase and the types vary, spreadsheets are no longer a viable solution and may likely become more of a hindrance, with calculations taking longer in the face of bigger transaction amounts and growing transaction data.

And in trading, there is always the need for rigorous computational functions. Computing for the Value at Risk (VaR) for large portfolios for instance, is simply way beyond the capabilities of spreadsheets. Banks that persist in using them are increasing the risk of loss on those portfolios. Or, they can be opening up?opportunities for fraud?as Allied Irish Bank (in the case of John Rusnak – $690 million) learned the hard way.

Risks in Underwriting

Bankers who use spreadsheets as their main source of information for underwriting procedures also face certain limitations. Loan transactions require that borrowers? financial data be centralised and easily accessible to risk officers and lending officers involved in making decisions. With spreadsheets, there is no simple and secure way of doing that. Information can be pulled from different sources – individual tax returns, corporate tax documents, partnership documents, audited financial statements – hence there is difficulty in verifying that these reports adhere to underwriting policies.

Spreadsheet control and monitoring

Financial institutions which are having difficulty weaning themselves from the convenience and simplicity that spreadsheets offer are looking for possible control solutions. Essentially, they want to find ways that allow them to continue using these UDAs and yet somehow eliminate the?spreadsheet risks?and limitations involved.

Still, the debate goes back and forth on whether adequate control measures can be implemented on spreadsheets so that that the risks are mitigated. Many services have come forward to herald innovative solutions for better spreadsheet management. But at the end of the day, there really is no guarantee that such solutions would suffice.

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Spreadsheet Risks in Banks


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Disadvantages of Spreadsheets – obstacles to compliance in the Healthcare Industry


How Internal Auditors can win the War against Spreadsheet Fraud


Spreadsheet Reporting – No Room in your company in an age of Business Intelligence


Still looking for a Way to Consolidate Excel Spreadsheets?


Disadvantages of Spreadsheets


Spreadsheet woes – ill equipped for an Agile Business Environment


Spreadsheet Fraud


Spreadsheet Woes – Limited features for easy adoption of a control framework


Spreadsheet woes – Burden in SOX Compliance and other Regulations


Spreadsheet Risk Issues


Server Application Solutions – Don’t let Spreadsheets hold your Business back


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Matrix Management: Benefits and Pitfalls

Matrix management brings together managers and employees from different departments to collaborate with each other towards the accomplishment of the organizational goals. As much as it is beneficial, matrix management also has limitations. Hence, companies should understand its benefits and pitfalls before implementing this management technique.

Benefits

The following are some of the advantages of matrix management:

Effective Communication of Information

Because of the hybrid nature of the matrix structure, it enables different departments to closely work together and communicate frequently in order to solve project issues. This leads to a proficient information exchange among leaders and subordinates. Consequently, it results to developed strategies, enhanced performance and quick productivity.

Efficient Use of Resources

Resources can be used efficiently in the organisation since it can be shared among functions and projects. As the communication line is more open, the valuable knowledge and highly skilled resources are easily distributed within the organisation.

Increased Motivation

The matrix structure promotes democracy. And with the employees working on a team, they are motivated to perform their duties better. The opinions and expertise of the employees are brought to the table and considered by the managers before they make decisions. This leads to employee satisfaction, empowerment and improved performance.

Flexibility

Since the employees communicate with each other more frequently, decision making becomes speedy and response is adaptive. They can easily adjust with diverse situations that the company encounters.

Skills Development

Matrix employees are pooled out for work assignments, even to projects that are not necessarily in line with their skill background. With this approach to management, employees have the chance to widen their skills and expertise.

Discipline Retention

One significant advantage of matrix management is that it enables the employees to maintain their skills in functional areas while working with multidisciplinary projects. Once the project is completed and the team wraps up, the members remain sharp in their discipline technically and return to their home functions.

Pitfalls

Here are some disadvantages of matrix management:

Power Struggle

In the matrix structure, there is always tension between the functional and project manager. Although their intent is polite, their conflicting demands and competition for control over the same resources make it more difficult.

Internal Complexity

Having more than one manager, the employees might become confused to who their immediate leader is. The dual authority can lead to internal complexity and possible communication problems. Worst, employee dissatisfaction and high employee turnover.

Heightened Conflict

In any given situation where people and resources are shared across projects, there would always be competition and conflict. When these issues are prolonged, conflicts will heightened and will lead to more internal problems.

Increased Stress

For the employees, being part of a matrix structure can be stressful. Their commitment is divided among the projects and their relationship with multiple managers requires various adjustments. Increased stress can negatively affect their performance in the long run.

Excessive Overhead Expenses

Overhead administrative costs, such as salaries, increase in a matrix structure. More expenses, more burden to the organisation. This is a challenge to matrix management that leaders should consider carefully.

These are just some of the advantages and disadvantages of matrix management. The list could go on, depending on the unique circumstances that organisations have. The key is that when you decide to implement matrix management, you should recognise how to take full advantage of its benefits and understand how to lessen, if not eradicate, the pitfalls of this approach to management.

Symbion Pharmacy Services? Definition of Responsibility

A ?symbion? is an organism in a symbiotic (i.e. mutually beneficial) relationship with another one. In the case of Australia?s giant Symbion Pharmacy Services, this means supplying and delivering over-counter Chemmart medicines to more than 3,000 hospital and retail pharmacies, while remaining mindful of its carbon footprint.

In 1999, the company with the tagline ?life matters? and a desire to be seen as ?a good corporate citizen? decided it was time to measure exactly what it was pumping out from 12 facilities and over 200 vehicles. This was a voluntary decision as even now there is still no carbon emissions law in Australia (although no doubt being a ?first mover? will put the company in a competitive position when this inevitably comes).

Symbion decided to install emission detection devices and connect these to a central monitoring system with the intention of managing what these measured. There were two stages to this process. First, Symbion determined its reporting requirements based on one of its larger warehouses. Following that, it established a carbon footprint for each of its wholly owned and managed facilities. This put it in a position to:

  • Analyse total emissions down to a level of detail where it understood the contribution of each source
  • Use big data management tools to identify carbon hotspots for priority remedial action
  • Inform the affected workforce, explain the monitoring system and keep them in the loop
  • Separately manage energy abatement programs such as lighting and delivery routes

The program also had productivity spin-offs in that it focused management attention on the processes behind the emissions that were ripe for material and system improvements. It also provided marketing leverage. Symbion?s customers are in the wellness business, ahead of the curve when it comes to how emissions contribute to chronic illness, and aware of the cost of this in terms of human capital.

EcoVaro could help you manage your throughputs by analysing your data on our cloud-based system. This includes trending your metrics, comparing them to your industry seasonal average, and providing you with a business-like view of how well you are doing.

Our service reduces your reliance on (and the cost of) third party audits, and simplifies the reporting process to your controlling authority. It simply makes more sense to contract your software out this way, and only pay for it when you need it.

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