HRG Process Management Auditing - 22 Sept 2003

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Process Management Auditing
Process Management Auditing
Version JP.10.1-UK Oct 03 ?The High Performance
Organisation Ltd
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Course objectives

• Given any process delegates will be able to
• Plan and implement an effective process
  management audit/ assessment
• Report findings that add value to the business
• Use the techniques to support areas for
  improvement

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Agenda Day 1
Introductions Process management review types
of audit/assessment Planning preparation
Lunch Opening meeting Process audit (part 1)
End of day 1
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Agenda Day 2
Process assessment practice Identifying findings
and draft reporting Lunch Closing meeting with
process owner Assessing improvements Summary
End of day 2
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Session 1
Process management review Process auditing
/assessment in practice
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Exercise 1

• For a Bus company
• Define a high level process map
• Create 4 measures of performance
• From this
• Are there any aspects of process management you
  would like to raise?

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Principles of auditing
Source ISO190112002
Relating to auditors

• Ethical Conduct
• Fair Representation
• Due Professional Care

Relating to audit itself

• Independence
• Evidence-based approach

What is the purpose of auditing?
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Types of auditing assessment
?
System
Process
Compliance
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Types of auditing / assessment

• Compliance auditing - Right or wrong
• Process management - Checking the
  flow assessment - The management of an
  individual process
• System assessment - The collective management
  of all
  processes in the system - Links and impact of
  external relationships
  - Inclusion of required
  
  frameworks

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Compliance auditing
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Process management assessment
Knowledge
Risks
etc.
Inputs
Outputs
Resources
Budget
Competence
Tar Act Var
Com.
Com.
Com.
Com.
Teamwork Ownership
Learn
Change
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Process management assessment
Purpose of process (supplier inputs customer
outputs)
Process objectives and targets
Monitor performance improve
The process itself
Key performance indicators
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Systems management assessment
A business in the real world
Satisfied customers
Government policy
The market for your products
 
Shareholder value
Products
Innovation / inventions
The law other regulations
Compliance to regulations
Environment
Demographic social changes
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Systems management assessment tests
Stakeholder customer needs ISO9004 / ISO9001
Monitor performance improve
Business (quality) objectives
Management information systems
Processes
Key performance indicators other measures
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Auditing assessment in context
System level
Process level
Compliance level
Procedures
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Session 2

• Planning preparing a
• process management audit

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Audit / assessment schedule
Q1
Q2
Q3
Q4
?
Purchasing/Fulfilment
?
?
Project Management
?
?
Financial Management
Creating The Concept
?
?
Business Planning
Based on your business needs
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Planning the assessment (1)

• Understand the system
• Understand the process
• Understand detailed requirements
• Customer specifics
• Framework specifics
• Procedures / supporting information / etc.

Where would you find these in your system?
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Planning the assessment (2)

• Create process management Audit Checklist
• What to look at / for
• What questions would best gather required
  evidence
• Create an Audit Plan
• Timescales
• Methods of auditing
• Auditees, etc.

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Assessment planning
consider

• Audit methods (groups, one to one,
  email,telephone, video conference etc)
• Plan to see process owner first last
• Elapsed time
• Consider cross-functional contacts
• Think about preparation time/breaks to gather
  thoughts

audits are not just one to one
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Process management assessment tests
we use this to carry out every interview
Purpose of process (supplier inputs customer
outputs)
Process objectives and targets
Monitor performance improve
The process itself
Key performance indicators
Assessor tool 2
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Exercise 2
You are about to assess the management of a
process. Create a list of some areas to look at /
questions to ask under each of the headings of
Assessor Tool 2
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Remember

• Ask questions that test relationships of activity
  within the process
• Address issues that tests relationships with
  other activities in other processes
• Dont forget to test the management of the
  process
• Dont forget to test the process itself

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What other things will you alsoneed to consider
in order to assess if the process is being
managed effectively ?
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Risks
Knowledge
etc.
Inputs
Outputs
Resources
Budget
Competence
Tar Act Var
Com.
Com.
Com.
Com.
Teamwork Ownership
Learn
Change
Assessor tool 3
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Exercise 3

• Select a process
• Consider a number of possible items to include in
  an audit plan checklist that tests process
  management using assessor tools 2 3

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Session 3

• The opening meeting

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Opening meeting

• With process owner/leader
• Check plan is OK?
• What would process owner want out of the audit?
• How is the report to be presented?
• Use the tools to audit management
  understanding

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Exercise 4(interviewing the process owner)
Given the process you have selected, you have 15
minutes to prepare to interview the process
owner (the facilitator)
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Session 4

• Process auditing (Part 1)

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Audit style
Often non-documented objective evidence. No
right or wrong
Assess management
Directors
Management
Supervisors
Staff
Audit compliance
auditors have to manage this dynamic
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Objective evidence

• Therefore objective evidence is based upon
• what is being audited/assessed and
• will come in both documented and
• non-documented forms

The question to ask is - How?
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Technique

• How do you know that?
• Explain to me?

How do you keep staff focussed on customer
needs?
Directors
Show me your business plan?
Management
Supervisors

• Show me
• Tell me

Staff
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Exercise 5(auditing non-documented objective
evidence)

• What questions would you ask to a Senior
  Manager and Staff member if you wanted to check
  that
• Are all team members are working in a process and
  not in a departmental silo?
• That the process performance is understood?
• That the aim of the process is focused on
  delivering profit customer satisfaction?

What non-documented evidence will you look for?
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Agenda Day 2
Process assessment practice Identifying findings
and draft reporting Lunch Closing meeting with
process owner Assessing improvements Summary
End of day 2
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Session 5

• Process audit / assessment
• practice

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Exercise 6(interviewing the process owner)
Using the preparation you did yesterday
interview the process owner (the
facilitator) Max. 10 mins per interview
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Exercise 7

• Auditing group
• Decide who will interview who in accordance with
  the plan
• Auditee group
• Decide who will be whom according to the process
  you
• are part of
• Exercise
• Each group will have 1 hour to complete their
  audit
• (it is OK to have a planned time
  out)

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Practice feedback

• Consider the findings of the group record
• (in preparation for report writing)
• Then
• What went well?
• What could you do better?
• Did you need paper?
• How did you get the objective evidence?

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Session 6

• Identifying findings
• draft report

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Findings?

• Summary of finding
• Areas for improvement
• Non-conformances (major)
• Non-conformances (minor)
• Observations
• Free format/form
• Areas of strength/success?

Explain the impact on the business! e.g.
Why will the owner be interested?
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Exercise 8
Produce a draft report for the process you have
audited in the format the process owner
wanted Time 20 to 30 mins Present the report
to the process owner agree findings Meeting
duration 5 to 10 mins
USE THE NOTES FROM YOUR EXERCISES
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Session 7Assessing improvements
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Planning the assessment of improvements

• Identify / focus on the findings of
• - Previous assessments
• - Previous improvement activities
• Then
• Schedule plan as before
• Prepare as before
• Carry out the assessment
• Report as before.

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Carrying out the assessmentof improvements

• Check
• Establish what action has been taken
• The effectiveness of action taken in relation
  to the original issue
• Escalate to System Owner if no action.

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Issues differences
What Issues or Differences from the way you have
carried out auditing in the Past does process
assessment create?
HOW CAN THE ISSUES BE ADDRESSED BY USING
DIFFERENT ASSESSMENT APPROACHES?
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Summary

• What are the benefits likely to be in adopting
  process management auditing/assessment?
• What are the key skills needed to apply process
  management auditing/assessment effectively
• Any further questions?

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Guidance, advice support
Working in partnership with The High
Performance Organisation Ltd 01604
470837 enquiries_at_the-hpo.com
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Quality (Business) Principles

• Customer focus
• Leadership
• Involvement of people
• Process approach
• System approach to management
• Continual improvement
• Factual approach to decision making
• Mutually beneficial supplier relationships.

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Quality Management Process Model
Continual improvement of the quality management
system
Management responsibility
Customer
Customer
Measurement, analysis and improvement
Satisfaction
Resource Management
Requirements
Product realization
Product
input
output
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The critical clause - Clause 4

• Identify processes
• Determine sequence
• Operate control
• Ensure resources information to support
  operation monitoring
• Measure
• Improve based on fact

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Impact of new standard
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Where are we now?
ISO90012000
ISO90011994 - typical system
Customer needs
Customer needs
Business objectives
Business objectives
Processes
Processes
Procedures
Procedures
Management information
Management information
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Processes v Silos - ISO90012000
Dept 1
Dept 2
Dept 3
Dept 4
CUSTOMERS
Deliver the service?
Understand Customer Needs
Manage Competence
Manage Resources
Develop Communicate Objectives
Monitor Improve Performance
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Process Management
 
                 
 
   
   
Implement improvement project to change the
process
Learn
Learn
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Management System Continuous Improvement
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The High Performing Organisation
Stakeholder requirements Customer requirements
Report on progress to meet objectives
Define prioritise objectives
Define processes to deliver objectives
Create management information system
Identify Process Measurements
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Processes v Silos - Whole Business
Dept 1
Dept 2
Dept 3
Dept 4
STAKEHOLDERS
Deliver the service?
CUSTOMERS
Service Design Development?
Business Planning?
Communicating winning business?
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Complementary Standards Frameworks
Excellence Model
Eg Customer ISO9001 Stakeholder ISO9004
ISO9004
ISO9001
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Management System StructureMulti-level mapping
Owner - Head of Scope
Management System
measure business performance finance, customer,
process, people
Process
Owner - Process Owner
the what
measure efficiency and effectiveness
Procedure/Information
the how
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A Typical System?
Understanding the Market
Business Planning
Bringing about change
Monitor measure Performance
Design / enhance Services
Communicate Services
Deliver Services
Managing Assets
Managing People
Managing Finance
What are your processes?