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6 mins read

5 Management Systems Gaps Impacting Business Performance

Topics: Quality Management Systems

Modern-day Management Systems Standards now require organisations to align and integrate their management systems with the strategic direction of the business.

Even though this concept has been around since 2015, many organisations still struggle to achieve this requirement, suffering from underperforming management systems and misleading perception of the benefits.

Modern-day Management Systems Standards now require organisations to align and integrate their management systems with the strategic direction of the business. Even though this concept has been around since 2015, many organisations still struggle to achieve this requirement, suffering from underperforming management systems and misleading perception of the benefits.

To achieve sustained success, organisations need to leverage their management systems as a business tool that focusses equally on its own strategic success AND on meeting the existing needs of its customers. It should also anticipate future expectations of its customers, by enhancing their satisfaction and experience.

Aligning and integrating your Management Systems with your strategic direction can seem like a daunting task at first. Getting this wrong can limit the performance of the business.

The first five gaps that you should consider focussing on to improve process efficiency and financial performance include:

Gap 1: Scope & Design of Management System VS. Business Context & Strategy

Many organisations look to implement a basic management system that meets the minimum requirements of the ISO management systems Standards. This design serves as a functional framework, delivering little or no internal added value, however, it meets stakeholder requirements allowing businesses to bid for tenders.

Limiting the scope and design of your management system by not taking full account of the potential Gaps between the organisations Business Context, its Strategy and the Management System can harm the organisation’s ability to achieve its overall objectives. It could create additional risks including poor strategic performance, operational and quality failures, employee demotivation and increased costs.

Businesses should use the tools and framework they already have available – their management system – to react to their unique Business Context and Strategy, to assess risks and opportunities, ensure management system plans are in place and resources are available to deal with them, and to deliver business performance and improve customer satisfaction.

Gap 2: Management Systems Processes VS. ISO Standard Requirements

When seeking certification to an ISO Management System Standard, organisations must understand and assess its context, objectives, risks and opportunities, and develop appropriate processes that support. Mapping these to the Standards requirements ensures that the organisation can realise business benefits, including reduced avoidable costs, improved performance while satisfying stakeholder expectations.

If there are gaps between your management systems processes and the Standard requirements, you are putting your certification at risk. Businesses should implement an effective internal audit program that assesses the effectiveness of business processes and procedures. Identifying issues in an internal audit allows opportunities to resolve the problems, reducing the risk of your certification body issuing a nonconformance.

Gap 3: Business Strategy VS. Structure & Resource Capacity/Capability

Every organisation is unique. However, at the centre of each organisation is a leadership team that sets the strategy and objective. Top management must support the strategy by implementing a structure with appropriate resources.

Failing to implement an appropriate organisational structure with the resources needed can cause the strategy to stall and potentially fail, increasing your costs to operate.

The organisations top management should define and outline the roles and responsibilities needed to achieve its intended result, filling gaps in the structure, and communicate these responsibilities and authorities throughout the organisation. Top management should not only communicate this, but ensure it is understood in the right context against the objectives.

Gap 4: Planned Management System Results VS. Actual Results

Modern Management Systems Standards require organisations to set an objective and a plan to achieve those intended results. If these objectives are not planned for appropriately, gaps can occur between planned and actual results. If left uncorrected, these gaps will damage the perception and value of your management systems, and will likely put the brakes on proactive improvement, holding you back.

Management System leaders need to investigate why it’s not performing to expectation implement corrective actions and process improvements to negate these risks. Organisations may need to consider what metrics they are monitoring to judge performance results and adjust these as the organisation evolves.

Gap 5: Preferred Culture & Attitude VS. Actual Culture & Attitude

Organisational culture will affect the attitudes and behaviours of its people and therefore it is vital to the success and health of a company. It determines the way your business conducts itself, how your people operate and perform and how your customers perceive you.

A gap between your desired and actual organisational culture will result in under-effort towards, and under-achievement of, strategic objectives. It impacts the organisations ability to innovate and be creative and commit and collaborate to be successful.

The framework of modern Management Systems Standards includes principles such as leadership, engagement of people and relationship management, which is fundamental in building an organisational culture. Organisations should first start at the top, assessing the alignment of company values, policies, processes and missions.

Top management should consider aligning and integrating the organisations management system with its strategic direction as a solution to filling the above gaps. By orienting the organisations people, processes and technologies towards an aligned, shared purpose, top management can reliably achieve its intended objectives.

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