AUDITING STRATEGY EXECUTION IN YOUR ORGANISATION INCREASING THE INFLUENCE, RELEVANCE AND VALUE OF INTERNAL AUDIT
HOW DO YOU BECOME MORE RELEVANT AND IMPORTANT TO YOUR STAKEHOLDERS?
STRATEGY EXECUTION Kaplan and Norton (developers of the balanced scorecard) report that 90 per cent of organisations fail to execute their strategies successfully A UK study of 200 organisations in the Times 1000 highlighted that 80 per cent of Directors thought they had the right strategies, but only 14 per cent thought they were implementing them well.
STRATEGY EXECUTION The Economist Intelligence Unit reported that organisations realise only around 60 per cent of their strategy s potential value because of failures in planning and execution. Fortune Magazine famously stated that organisations fail to successfully implement strategy, not because of bad strategy, but because of bad execution
STRATEGY EXECUTION Underlining these facts, PwC s March 2012 global State of the Internal Audit profession study reports that: Large Program Risk was regarded by stakeholders in the bottom quartile of well managed risk 82% of stakeholders in the study regarded Internal Audit s role therein as very important or important
THE AUDIT PARADOX Corporate Executive Board research highlights that strategic risks account for 70% of share price decline Most Internal Audit teams spend 80% of their time on traditional assurance activities with as little as 6% of time allocated to strategic risk assurance.
The role of Internal Audit in reviewing business strategy?
THE PERCEPTION OF VALUE Stakeholder perception of value resulted in the question: How does Audit address strategic risk more effectively?
STRATEGY EXECUTION REVIEW METHODOLOGY Aligned to organisational strategic priorities and bottom line performance Arm's length diagnostic Health Check Snapshot review into project activity mirrors lifecycle and enables course correction to promote success/protect your investment Delivers Contemporary Assurance
ELEMENTS OF THE APPROACH The approach delivers a snapshot of strengths and weaknesses in flight enabling course corrections before its too late. Online Survey & data gathering via Internet Portal Interviews of key stakeholders expands and deepens information Project artefact review confirms and completes evidence
ENGAGEMENT LEVELS ARE KEY The level of engagement, alignment and the extent to which the intent of the project is understood is critical Sponsor Steering Committee Project Team Senior Stakeholders Users
CALIBRATE ON ENGAGEMENT Poll for stakeholder perceptions and confidence levels Triangulate stakeholder feedback and deep dive on the disconnects
KEY SUCCESS FACTORS ASSESSED Leadership & Governance Benefits & Value Business Transition Project Execution Sustainability Senior Management Sponsorship Active Benefits Management Structured Change Management Structured Project and Schedule Management Transition to Business as Usual Proactive Governance Rigorous Cost Management Engagement and Communication Design Quality Management Lessons learnt are tracked and adopted Impacts Assessed, Understood and Actioned Solution Build Quality 13
DASHBOARD VIEW OF STATUS 1. GOVERNANCE & SPONSORSHIP i. Effective Project Sponsorship ii. Effective Project Governance 2. BENEFITS & VALUE i. Active Benefits Management ii. Rigorous Cost Management 3. BUSINESS TRANSITION i. Structured Change Management ii. Effective Engagement and Communications iii. Impacts Assessed, Understood and Actioned 4. PROJECT EXECUTION 5. SUSTAINABILITY i. Structured Project Management ii. Design Quality Management iii. Solution Build Quality i. Transition to Business as Usual ii. Lessons learnt are tracked and Adopted
INSIGHT OVER THE JOURNEY
SO, HOW DO YOU BECOME RELEVANT AND IMPORTANT TO YOUR STAKEHOLDERS? Provide traditional assurance Rebalance your overall Audit program toward strategic risk - work that your customers think is important Deliver strategically relevant, succinct communication Deliver contemporary assurance Deliver deeper insight, perspective and value
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