Organisational appraisal

 

How does one appraise an organisation?  How can appraisal be objective?  It is reasonable to propose that appraisal should take place within some sort of framework and that the framework should be rational and transparent.  A widely accepted technique that uses a structured approach has evolved from work carried out by Kaplan and Norton and others in the early 1990s, and is based on a number of perspectives in addition to basic financial performance:

· A customer perspective "How do our customers see us?"

· An internal business efficiency perspective "How good are our internal business processes?"

· An assessment of organisational health "Looking at the support we give to our employees and our culture, how well do we support the drivers of future success?"

 

Using this approach, the organisation develops its own measures in each of these areas, and the governors, managers and staff of the organisation strive for improvements.  Some measures might be the responsibility of specific parts of the organisation indicating their own performance, while other measures might be organisation-wide.  The senior management of the organisation can make a composite of all these measures to form a so-called balanced scorecard.

 

Structuring an appraisal in this way has particular value when assessing non-profit organisations because financial perspective relates to use of a budget rather than the making of a profit, while the non-financial aspects are normally very prominent, some even being the organisation’s raison d'être.  

 

In the types of client we work with the results an appraisal using these measures can yield a valuable characterisation of the organisation.  Revisiting the above three perspectives for the types of client that we typically deal with:

· Because the organisation is in the business of creating social impact, the question about customers views can helpfully be recast as "How do all our stakeholders see us and what is the extent and the nature of our impact upon them?". Students are clearly customers of the institution, but in another sense so are prospective employers.  If public money is being used, then so are taxpayers, in that they are paying stakeholders in the institution’s performance and efficiency.  It is for the institution to produce objective measures of its impact that portray its performance and effectiveness as well as properly portray changes.

· The quality of business processes are a very valid topic of enquiry.  Tertiary educational institutions are complex, and often have numbers of small units that perform support functions.  It is very common for business processes not to be particularly optimised amongst these units, so that for example a unit might record information that is also held elsewhere, leading to duplication of work and the possibility of inconsistencies.  Furthermore, the small units often have their own management structures, each with its own associated costs. Taking an institution-wide view of business processes (and by implication, organisation) can be very instructive in highlighting opportunities for improvement as well as providing knowledge of where internal costs actually originate.  Typical benefits are improvements in quality of services, better capability to cope with organisational and strategic change - agility, and better control over costs.

· Looking at organisational health, tertiary education institutions by their very essence possess many teaching and research staff who, while they are individualists, are generally very happy to work alongside administrators and leaders that guide and run the institution as a whole while leaving them to do their work.  For this reason the organisational culture has to give appropriate support and recognition to all its staff, academics and all other types of support staff.  It is notable that many of the world's most successful academic institutions are ones in which the spirit of a community of scholars coexists with excellent leadership.