Optimising performance through C3I (coordination, collaboration, communication and integration) to ensure high financial performance levels

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Optimising performance through C3I (coordination, collaboration, communication and integration) to ensure high financial performance levels …

Optimising performance through C3I (coordination, collaboration, communication and integration) to ensure high financial performance levels

* Looking at the current situation - How do stakeholders work with each other?
* Can the collaboration be improved and how does it affect the process in driving high financial performance levels
* Exploring strategies on communicating KPIs to all levels; starting from below

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  • 1. 1SUNIL KOHLI INDIAN DEFENCE ACCOUNTS SERVICE Joint Secretary And Financial Adviser National Disaster Management Authority And National Disaster Response Force(NDRF), Ministry Of Home Affairs, India DEFENCE FINANCE AND ACCOUNTS DEPARTMENT “ENSURING COMPLIANCE AND PROPELLING PERFORMANCE”
  • 2. 2TALK TOPIC―OPTIMISING PERFORMANCE THROUGHC3I(COMMUNICATION, COORDINATION,COLLABORATION, AND INTEGRATION)TOENSURE HIGH FINANCIALPERFORMANCE LEVELS‖
  • 3. 3 Broad Outline• Looking at the current situation- How dostakeholders work with each other?•Can the collaboration be improved and howdoes it affect the process in driving highfinancial performance levels•Explore strategies on communicating KPIsto all levels; starting from below
  • 4. 4 Agenda•Contextual Parameters •Current Situation •Governance Framework •Performance Management •Role of KPIs•How Public Sector is different?•Who are the Stakeholders? •Organization Structure•Role of Finance Managers•Issues for Optimizing Performance for EnsuringHigher Performance Levels
  • 5. 5 Agenda•C3I Approach •Coordination •Collaboration •Communication •Integration•Role of IT•Integrated Approach to address GRC Concerns•Strategies to communicate KPIs•Closing Remarks
  • 6. 6 Contextual Parameters• Government, Public Sector Organizations and Corporateare the biggest entities which affects the lives of thecitizens and the consumers.• Transparency, Risk and Compliance are the main attributesto ensure Accountability and Corporate SocialResponsibility.• Improved Collaboration among the stakeholders andLeveraging Technology by these entities will ensureprocess improvement and drive high performancelevels beside Rebuilding Public Trust in theseorganizations.
  • 7. 7 Contextual Parameters: Role of IT• IT can play an important role in InformationManagement, Risk Management, Better Pricing andAccessibility of Products and Services and bringingabout greater Transparency and ensuringperformance.• In this environment of recession and slow down ofeconomy and fast rate of Technological Obsolescencecompanies can drive strategic advantage andovercome competition by proactive deployment oftechnology.
  • 8. 8 CEOs “cashed out” prior to economic crisisCEOs at major US financial andreal estate firms converted tens ofmillions of dollars of overvaluedstock into cash prior to theeruption of the current financialcrisis. •Shocking Reality Check •Collapse of Financial Systems •Breed Culture of Macho Management and Self interest •Block Information and Transparency.
  • 9. 9Context Drivers :Four pillars of Good Governance• Accountability• Transparency• Predictability• Participation
  • 10. 10Transparency And Accountability MechanismsAccountability• The major purpose for performance measurement in the government and the public sector revolve around the concept of enhanced accountability.• Accountability Implies: - – Weeding Out Inefficiencies – Eliminating Wasteful Expenditure – Improving Cost Effectiveness – Monitoring Outputs And Outcomes
  • 11. 11Performance MeasurementAdministrative Imperative than a choice• Performance measurement itself is only a tool--it is not an outcome in itself.• To determine if government is meeting its objectives and those of its constituents.• Measures of performance include : - – Inputs (the resources allocated), – Outputs (direct results of program activity), – Efficiency measures (ratio of inputs to outputs), and – Outcomes (broad results of program activities in the lives of those served).• Result Orientation and Cost Consciousness are key criteria for designing the KPI’s.
  • 12. 12PERFORMANCE MEASUREMENT• WHY?• ENHANCES DECISION MAKING• IMPROVES INTERNAL ACCOUNTABILITY• ENHANCES PUBLIC ACCOUNTABILITY• SUPPORTS STRATEGIC PLANNING AND GOAL SETTING.• ALLOWS ENTITIES TO DETERMINE EFFECTIVE RESOURCE USE
  • 13. 13 KEY PERFORMANCE INDICATORS?• FOUR MAJOR PERSPECTIVES• FINANCIAL PERSPECTIVE – KPIS SUCH AS FUND MANAGEMENT, RESOURCE ALLOCATION, % INCREASE IN RETURN ON INVESTMENT AND RESOURCE UTILIZATION. – THIS PERSPECTIVE PROVIDES FOCUS TOWARD EFFECTIVE UTILIZATION OF FUNDS AND RESOURCES.• INTERNAL PROCESSES PERSPECTIVE – KPIS LIKE NUMBER OF STREAMLINED PROCESSES, NUMBER OF SERVICE DELIVERY TARGETS MET, INSTANCES OF REPEAT SERVICES AND RESPONSE ACCURACY.• CITIZEN FOCUS PERSPECTIVE – KPIS LIKE PEOPLE ACCESS, CRITICAL ERROR RATE, SERVICE AND PRODUCT COMPLAINTS AND CLIENT SATISFACTION LEVEL. – IT HELPS IN KNOWING HOW WELL THE OPERATIONS ARE FOCUSED TOWARDS THE PEOPLE THE ORGANIZATIONS IS SERVING.• H.R. AND GROWTH PERSPECTIVE – KPIS SUCH AS % DECREASE IN STAFF TURNOVER, TRAINING DAYS PER MEMBER, AGENT COACHING RATIO, % INCREASE IN TRAINING BUDGET AND % IMPROVEMENT IN EMPLOYMENT LEVEL.
  • 14. 14PURPOSE AND GOALS OF GOVERNMENTFINANCIAL MANAGEMENT• Three goals of government financial management as identified# are: -• Fiscal management,• Resource allocation and• Efficiency of expenditure (Value for money).• Transparency and Accountability are identified as advantages of good financial management. • # “Budgetary Institutions and Expenditure Outcomes”, Ed Campos and Sanjay Pradhan, World Bank Policy Research Department, September 1996
  • 15. 15How Public Sector are different?• Uniqueness Of The Government Operations• Performance Measurement In Government• Significant Operational Differences Between The Public And Private Sectors
  • 16. 16Uniqueness of the Government Operations• Governments are committed to fiscal accountability, a process that provides a visible trail as to where resources come from and where they go.• Governments are creatures of law and as such, they can do only what the law allows,(the things that it is authorized to do) and using the methods that are prescribed in contrast to organizations in the private sector that can do anything not prohibited by law 16
  • 17. 17Performance Measurement in Government• The motivational impetus are different.• Introduction of more explicit measurable standards of performance to improve the efficiency and effectiveness of government entities.• In particular, the initiative was designed to: – Cut government expenditure; – Increase managerial accountability of government operations; And – Strengthen the government’s resource allocation and administrative decision-making capabilities.• Framework of the Govt. has to confirm to – Legality, – Legitimacy of Law (Legitimate powers and regulations), – Legitimate use of powers (General interest orientation with criteria of 3E’s and Quality of service) and 17 – Approval by the citizens.
  • 18. 18SIGNIFICANT OPERATIONAL DIFFERENCESBETWEEN THE PUBLIC AND PRIVATE SECTORS• PERFORMANCE CRITERIA.• ACCESSIBILITY OF GOVERNMENT DECISION MAKING TO EXTERNAL INFLUENCE.• CONFLICT BETWEEN GOVERNMENT POLICYMAKERS AND ADMINISTRATION.• THE EMPLOYMENT CONTRACT.• INTENSE SCRUTINY BY THE MEDIA AND PUBLIC INTEREST GROUPS.• EMPHASIS ON STABILITY AND RELIABILITY.• ATMOSPHERE OF CONTROL AND MISTRUST.• DIFFERENCE IN STATUS. • These describe a series of unique, personal problems that affect the attitudes of government officials. The government manager is not only responsive to the usual personal and group behavioral pressures but also is influenced by reactions to many of these factors.
  • 19. 19Journey to Public Sector Transformation• Redefining the Role of State• Focus on Service, not thrift• “Journey From Waste Elimination, Through Efficiency Gains To Strategic Transformation” – Short Term Cost Reduction – Efficiency Improvement – Strategic Transformation
  • 20. 20MOST CHALLENGING AREAS FOR IMPROVEMENT
  • 21. 21 Short Term Cost Reduction• Activities – Cut expenses- No negative impact on services – Reduce Staff Cost – Delay Major Projects- A viable, short-term solution.• Positive Impact – Fast results – Politically attractive – Results sound attractive• Negative Impact – Short term impact – Repeated Reviews – Painful and not sustainable• Will it work: Insufficient
  • 22. 22 Efficiency Improvement• Activities – Improve Financial Management – Share Resources and Services – Improve Management of External advisors – Review HR Practices & Incentives• Positive Impact – Fairly fast results – Effect last longer – Strong Foundation for Transformation• Negative Impact – Insufficient for radical changes – Confined within existing structures• Will it work: Insufficient
  • 23. 23 Strategic Transformation• Activities – Reassess spending priorities – Focus on new sources of funding – Involve Private Sector in delivery of Public Services and achieve Public services Transformation – Ensure effective Commissioning of Services and management of Contracts – Focus on Strategic Leadership• Positive Impact • Long term impact • Drives structural Changes • Route to financial recovery• Negative Impact • Complexity • Delayed evidence of results • Potentially controversial• Will it work: Insufficient: Yes
  • 24. 24 IMPERATIVES FACING THE PERFORMANCE OF GOVERNMENT• The challenges now facing government are more complex and require a new set of imperatives for success.• These imperatives facing the performance of government in the 21st century are: – A policy agenda that focuses more on problems than on structures – Political accountability that works more through results than on processes – Public administration that works through networks rather than through hierarchies – Political leadership that leverages action rather than simply makes decisions – Citizenship that is based on involvement rather than remoteness Source: www.businessofgovernment.org
  • 25. 25 Six Trends Transforming Government• Trends responding to these imperatives and is leading to improved government performance.• These trends, often in combination with one another, make it more likely that government will be able to successfully respond to the ever- increasing and complex challenges it faces today and will continue to face in the future.• Trend One: Changing the Rules• Trend Two: Using Performance Management• Trend Three: Providing Competition, Choice, and Incentives• Trend Four: Performing On Demand• Trend Five: Engaging Citizens• Trend Six: Using Networks and Partnerships Source: Six Trends Transforming Government By Mark A. Abramson, Jonathan D. Breul, and John M. Kamensky
  • 26. 26 GOVERNMENT TRANSFORMATION• Government Transformation are being driven, in part, by advances in technology that have resulted in significant changes in the operation of organizations.• Technology should now be viewed not only as a fundamental tool for government, but also as a driver for transforming the operations of government.
  • 27. 27 Issues for Optimizing Performance for Ensuring Higher Performance Levels• Critical Areas For A More Proactive Approach – Overcoming Crisis Of Corporate Trust – Greater transparency about business practices. – Less risk associated with products and services. – Better pricing and accessibility of products and services. – More emphasis on the development of socially and environmentally responsible products and services. • Based on McKinsey Research
  • 28. 28Issues for Optimizing Performance forEnsuring Higher Performance Levels1. Corporations Need to Rebuild and Strengthen Stakeholder Trust2. Pervasive Fragmentation Complicates the Pursuit of Stakeholder Trust3. Beyond a ―License to Operate‖: Trust Contributes to Competitive Advantage4. An Integrated Approach to Transparency is Essential “Building Corporate Trust is Expensive but Makes Business Sense”
  • 29. 29Conclusion• An integrated approach to governance, risk management, and compliance has several benefits: – Lower costs; Better leverage of existing investments; – New scale for information sharing initiatives; – Support for new innovations; and – Unprecedented levels of collaboration and coordination. – Holistic approach that marries business considerations with stakeholder interests is the right “manrta”.• Implement an Executive Cross Functional Governance Structure
  • 30. 3 C3I Approach 0•C3I Approach •Communication •Coordination •Collaboration •Integration
  • 31. 31 Models For Enterprise Architect• ―These models are intended to facilitate government wide improvement through cross- agency analysis and the identification of duplicative investments, gaps, and opportunities for collaboration, interoperability, and integration within and across government agencies‖. • Source: The GAO Report
  • 32. 32Effective Communication withStakeholders• More people will be affected by a partnership than just the public officials and the private sector partner. Affected employees, the portions of the public receiving the service, the press, public labor unions and relevant interest groups will all have opinions and, frequently, significant misconceptions about a partnership and its value to all the public.• It is important to communicate openly and candidly with these stakeholders to minimize potential resistance to establishing a partnership.
  • 33. 33 Communication Strategy• Establish a Communication Strategy to Create Shared Expectations and Report Related Progress:• Creating an effective, on-going communication strategy is essential to implementing a merger or transformation.• Communication is most effective when done early, clearly, and often, and is downward, upward, and lateral.• The new organization must develop a comprehensive communication strategy that reaches out to employees, customers, and stakeholders and seeks to genuinely engage them in the transformation.
  • 34. 34 Communication Strategy• In order to be successful, a communication strategy relies on the following critical success factors: – Timely sharing of information – Accurate and consistent messages conveyed to key audiences – Realistic messages from trusted sources that set realistic expectations.
  • 35. 35Challenges of CommunicationInteroperability• The inability to communicate is a problem that is:-• Technical (due to limited and fragmented radio spectrum and proprietary technology),• Political (due to agencies and jurisdictions and different levels of government competing for scarce dollars, inhibiting the partnership and leadership required to develop interoperability)• Cultural (agencies natural reluctance to give up management and control of their communications systems) and must be addressed on all these levels.• A well defined interoperability governance model provides the structure needed to bring the players together and promote an environment that helps bridge the gaps created by these obstacles.
  • 36. 36Benefits to Successful Interoperability• Better coordination among responding agencies• Political benefit• More efficient law enforcement and protection
  • 37. 37Collaboration: Technology as a KeyEnabler• Whether collaborating horizontally across state agencies, entering into a public-private partnership, or crossing organizational boundaries between state- federal or state-local levels of government, one must continuously work to connect silos to increase efficiency and improve citizen service.• With technology serving as a chief facilitator for collaboration across organizational boundaries, engaging in cross-boundary collaboration is inevitable.
  • 38. 38Collaboration: Technology as a KeyEnabler• Government, in order to be effective, must be user- friendly, accessible and accountable to citizens.• Leveraged by investments in information technology, crossing organizational boundaries between levels of government can be used as a way to increase governmental effectiveness.• Citizen demand for streamlined, efficient government often drives state agencies to seek out opportunities to deliver traditional services in non- traditional ways.
  • 39. 39Collaboration: Technology as a KeyEnabler• Engaging in cross-boundary collaboration is often viewed as a means to achieve the following: – Cost reduction – Establishing relationships between organizations – Providing increased or better services to citizens – Streamlining processes and speeding transactions – Improving information-sharing and quality – Leveraging enterprise solutions – Sharing risk – Addressing fiscal constraints and lower administrative costs by leveraging mutual resources.
  • 40. 40 The Challenge of Integration• Silos of information could be made accessible across the enterprise in a secure, structured and collaborative manner.• Such access could provide benefits that outweigh implementation costs, such as reduction of redundant data entry, improved data integrity, increased accuracy and immediacy, and improved decision-making.• On a more contextual level, integration is focused on the sharing of data across organizations and domains, within an established enterprise, based upon standard formats.
  • 41. 41Integration: More than Just aTechnology Issue• The technology provides the bridge for information sharing.• In order to be successful in an integration initiative:- – A vision and business case needs to be articulated; – A collaborative and trusting relationship between participants needs to be established; – An outreach to community and funding sources must occur; and – A model for program management must be defined. – Integration is not just about sharing data, it is about sharing information to achieve common business purposes across disparate entities.
  • 42. 42 Benefits of Successful Integration• Improved Communications• Improved Decision Making• Resource Savings• Enhanced Service Delivery
  • 43. 43 Distinctive Features Of IT• Trusted Interface• Critical Business Enabler• Competitive and Strategic Differentiator• Reduces Costs by Optimizing Resources• Managing risks associated with data security and regulatory compliance.• Integrate different departments and disparate internal controls systems
  • 44. 44WHY INFORMATION TECHNOLOGY?• Capable of comprehensive holistic IT Governance approach: Bridge Functional Silos.• Easy to adapt C3I Approach – Coordination; Communication; Collaboration; and Integration – Process of ―Mutualism‖ Collaborative Decision Making and implementation to optimize Performance• Eliminate Ad Hoc Setup and Human Errors.• Overcome DRIP Syndrome• Align IT controls to corporate policies, and corporate policies to regulations.
  • 45. 45 HOLISTIC APPROACH TO IT GOVERNANCE• Enables companies to dynamically manage and monitor key IT enabled GRC activities such as: - – Information Protection and Privacy; – Configuration and Change Management; and – IT GRC management across multiple business units, geographies and IT systems.• The result is IT governance that is sustainable, cost- effective, and better aligned to the strategic and operational demands of the business.
  • 46. 4 6 Integrated Approach to address GRC Concerns•Adopt an Integrated Strategy and a ComprehensiveApproach To Managing Governance, RiskManagement, and Compliance (GRC) solutions •To Address all regulatory and business related risks and achieve compliance at a lower cost. •To differentiate itself and achieve greater agility by optimizing your business processes and using risk intelligence for better decision making.• Drive Business Predictability and StakeholderConfidence •Help improve relations with stakeholders and, ultimately, facilitate trust
  • 47. 47 THE FOUR DEGREES OF FRAGMENTATION• GRC activities are typically fragmented across four dimensions:• Organization• Systems• Regions• Internal GRC disciplines
  • 48. 48The High Cost Of A FragmentedApproach• From a pure cost perspective, the status quo is simply too expensive to sustain.• Only with an organizational view of GRC information and a comprehensive solution for managing GRC across the enterprise can you manage with confidence, improve business predictability, and drive higher performance.• A GRC strategy can also be a critical driver of revenue and competitive advantage because you can accurately assess the risk of various business decisions.
  • 49. 49 Definition of GRC• GRC is a system of people, processes, and technology that enables an organization to: – Understand and prioritize stakeholder expectations. – Set business objectives that are congruent with values and risks. – Achieve objectives while optimizing risk profile, and protecting value. – Operate within legal, contractual, internal, social, and ethical boundaries. – Provide relevant, reliable, and timely information to appropriate stakeholders. – Enable the measurement of the performance and effectiveness of the system. “GRC is to risk management as computer systems are to the payroll system” • From: Open Compliance and Ethics Group:
  • 50. 50Leverage GRC as a Proactive BusinessOptimization Instrument• The real business value comes from leveraging GRC as a proactive management instrument – not just in terms of avoiding the costs of noncompliance, but in terms of driving revenue and competitive advantage.• Ultimately, GRC is about seeing the opportunities associated with a given business change and placing your organization in the best position to capitalize on those opportunities.• This requires moving toward tightly integrated business and IT functions – the key to improving enterprise risk awareness and response capabilities, as well as recognizing opportunities.
  • 51. 51Last word• IT governance system is no substitute for real leadership.• Processes can’t command attention that executive give to trusted peer.• Systems alone don’t forge common vision or inspire action.• Lead IT Governance- Don’t lead by it.• Strong IT leadership needed to bring coherence to the companys fragmented systems.• Executive teams with a strong IT leader make better, faster decisions about technology than do companies that rely solely on a governance system—no matter how effective it is.
  • 52. 52Road Ahead• Fact Based Decisions: Based on Economic Intelligence, Proper survey backed by professional reports• Overcome DRIP Syndrome – ―Data Rich but Information Poor‖• Establishing Performance Management As An Organizational Priority• Engaged Leadership Team with Singular Sense Of Strategic Direction• Stimulate Organizational Culture Shift• Value For Money Outcomes• Macro perspective: Never loose sight of Big Picture• Prioritized Focus
  • 53. 53Road Ahead• Flexibility In Decision-making• In general, flexibility in decision-making is important in order to achieve efficient and effective operational performance.• At the policy level, ministers should be given authority to make decisions relating to their particular sector, provided that they fit the strategic policy objectives of the government.• At the operational level, managers should have authority to take decisions with their defined area of competence.• Flexibilities need to be balanced by appropriate rules and standards of conduct, proper arrangements for accountability, and control mechanisms.