Module 3.0 Restructuring Your Agency

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Module 3.0Restructuring Your Agencys
Administrative Services Organization
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The objective of this module is to ...

• Introduce concepts and tools that can assist with
  designing an effective structure for
  administrative services regardless of the size of
  your agency
• Provide agencies with information to understand
  strengths and weaknesses of different structures
  for Simplified Administrative Services
• Discuss the timeline and transition issues
  related with changing the structure

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Our Agenda for the day.

• 830 Overview
• 845 Assessing your current organizations
  infrastructure
• 915 Developing your to-be infrastructure
• 1015 Break
• 1030 Implementing your new Administrative
  Services infrastructure
• 1100 Lessons Learned and Next Steps

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OVERVIEW
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We are now at the agency Organizational
Infrastructure process for Simplified
Administrative Services

• Conceptual Design Framework
• Develop organization vision themes
• to support overall vision
• Define key relationships between processes
• Identify areas for integration

• Redesign Processes
• Identify target process areas
• Define processes and organizational
• responsibility
• Identify initial skills needed

• Directional Design
• Align processes with current org. activities
• Identify leadership responsibilities
• Identify organization attributes
• Assess alternative organization models
• Select model and develop high-level
• organization chart for central
• admin services operations

We are here

• Detailed Organizational Design
• Finance and Administration
• Develop job design, management, and
• accountability structures
• Develop competency requirements
• Map employees to roles
• Develop next layer of org. chart

• Organizational Infrastructure
• for Agencies Administrative Services
• Processes
• Share with agency organizational teams
• Identify organization attributes
• Assess alternative organization models
• Select model and develop high-level
• organization chart

• Process Refinement
• Align processes with system vendor
• Detail redesigns to organizational and human
  resource levels
• Integrate overlapping processes

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Specifically for the agencies we will...
We are here

• Organizational Infrastructure
• for Agencies Administrative Services
• Processes
• Share with agency organizational teams
• Identify organization design criteria
• Assess alternative organization choices
• Propose models and help develop
• high-level organization charts
• and plans

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As part of our preparation for today, we met with
many of you regarding your current structures

• We asked specific questions related to your
  structure, approval path, and processes for doing
  material and financial management activities
• We developed model as-is structures to identify
  common strengths and weaknesses of the structures
  across the Commonwealth

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However, organizational infrastructure is
comprised of a number of building blocks
Structure alone will not support the success you
need...
Organization Structure
Leadership
Staff Development
Recruitment/ Deployment
Rewards/ Incentives
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Today, we will discuss the important factors
related to these characteristics of
organizational design

• How involved does leadership need to be?
• What are potential hazards of changing the
  structure?
• Where are the critical points for decision
  making?

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Todays session will be supported by a number of
tools, templates, and examples

• Hard copies of tools and templates are located in
  your handouts
• Each participant will receive an electronic
  folder with the tools and templates
• They will be sent to your email address on Monday
  and Tuesday of next week
• Examples are imbedded within todays module.
  Primary example will be the Finance and
  Administration Cabinet and organizations within

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Tools that you will receive
File Name Description
asis_assess.doc handouts.doc orgdoc_out.doc
How to assess your organizational
infrastructure A case example of the Finance and
Administration Cabinet that includes a number of
templates and documents that you can modify to
meet your agencys needs Outline for creating an
integrated organizational briefing document to
support desired organizational changes
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To improve your agencys Administrative Services
approach, ask the following questions

• Does your agency lack a clearly defined set of
  vision and design criteria for your
  administrative services organization?
• Does your agency currently have a Central data
  entry organization
• that enters data from field or program areas?
• Does your agency have more than three approval
  paths?
• Does your agency currently store copies of forms,
  invoices and bills
• in more than one location for your agencys
  transactions?
• Does your agency have redundant activities
  occurring in your
• administrative services area (e.g. duplicative
  data entry)?
• Does your agency receive complaints regarding the
  amount of time it takes to process documents,
  receive payments, get things approved?
• Does your agency strive to be recognized as
  having Best Practices

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If the answer was YES to ONE or more questions,
consider the following process

• Assess current organizational processes
  characteristics
• Create design criteria
• Create to-be organizational processes
  characteristics
• Develop a new organizational infrastructure
• IMPLEMENT!

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Assessing Your Current Organization's
Infrastructure
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Assessing your agencys current organizational
infrastructure requires
STEP 1

• Understanding the current administrative services
  activities that employees in your agency do
• A current organizational structure diagram with
  an understanding of reporting relationships and
  approvals
• Evaluating your administrative services
  organizations current approach to other
  Organizational Characteristics
• Description
• Strengths and weaknesses

STEP 2
STEP 3
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The first two steps are complete...
STEP 1
STEP 2

• In the fall of last year, many of you completed
  the as-is analysis. This data provides a good
  baseline for beginning the assessment process
• In January and February, a number of you worked
  with us to define as-is organizational structures

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Our initial analysis of current structures and
approval approaches identified several findings.
Organization Structure
STEP 2

• Size of agency was not a key determining factor
  for structure or number of approvals
• Differences in centralized and decentralized
  structures were fairly significant
• Agencies that had the same structure on paper,
  did not necessarily identify the same strengths
  and weaknesses
• As-is models are located in Appendix A by size of
  agency

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Small Agency Models
Organization Structure
STEP 2

• Small Agencies included
• Agriculture
• Economic Development
• Military Affairs
• Arts Humanities
• Small Agencies generally had 2 models
• Centralized
• Decentralized

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Medium Agency Models
Organization Structure
STEP 2

• Medium agencies included
• Natural Resources and Environmental Protection
  Cabinet
• Public Protection and Regulation Cabinet
• Medium sized agencies generally had 3 models
• Central approval and processing
• Central approval
• Decentralized

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Large Agency Models
Organization Structure
STEP 2

• Large agencies included
• Cabinet for Families and Children
• Transportation
• Workforce Development
• Cabinet for Health Services
• Justice Cabinet
• Finance and Administration Cabinet
• Large agencies generally had 3 models
• Central approval and processing
• Central approval
• Decentralized

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Sample of Financial Management (Centralized/funct
ional)
Organization Structure
STEP 2
Finance Administration Cabinet
Agency
Department
Department
Department
Department
or Office
or Office
or Office
or Office
Approval 3 5
Approval 2
Division
Division
Division
Branch
Approval 1
Administrative
Branch
Origin of Transaction
Approval 4
Financial
Branch
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Assessing the Organizational Infrastructure
STEP 3

• How do leadership actions support the development
  and direction setting for Administrative
  Services?
• How are they promoted and used? Is there an
  opportunity to use them better? Develop new
  ones?
• How is training viewed and communicated? Are
  staff proactive in identifying appropriate
  training? Are staff encouraged to develop a
  career plan? Is performance measured and managed
  effectively?
• How does your agency address recruitment and
  deployment of employees? Do you have a career
  path?

Leadership
Rewards/ Incentives
Staff Development
Recruitment/ Deployment
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Beginning the assessment process
STEP 3

• Use the assessment in your handouts
• Work with your agency team members to review and
  begin the assessment
• We will reconvene in ten minutes to discuss

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Administrative Services for the Future
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This section will address how to...
STEP 1

• Create agency-specific organizational design
  criteria and performance objectives
• Identify influences and constraints
• Conduct preliminary analysis
• Create to-be organizational characteristics
• Determine new model structures
• Develop a briefing document for the new
  organization

STEP 2
STEP 3
STEP 4
STEP 5
STEP 6
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Create design criteria and performance objectives
STEP 1

• Design criteria define what the new organization
  should ideally be able to provide.
• Design criteria may conflict with one another
• Performance objectives define what high level
  outcomes you want to achieve as an organization
  and will help drive the design.

Example
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Identify influences and constraints
STEP 2

• This step is the reality check and identifier of
  potential roadblocks
• Important to complete after establishing the
  design criteria and performance objectives
• Examples of influences and constraints include

Geographic Dispersion
Employee Skills
Legislation/ Statutes
Readiness for Change
Political Influences
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Beginning the process
STEP 2

• With your agency team members, draft some design
  criteria and performance objectives
• Draft some influences and constraints
• In ten minutes we will reconvene

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Conduct Preliminary Analysesprioritize and
assess gaps
STEP 3

• With leadership, identify which criteria and
  objectives are a priority. Use a rating scale of
  1-5 with 1 being a priority
• Assess the current priority of that criteria
  within the organization today

Design Criteria Priority Future Priority
Today Gap Improve processing times
1 3
2 Reduce duplicative 2
5
3 activities
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Conduct Preliminary Analyses assess the effort
to change and associated costs
STEP 3

• The gap analysis and the influences and
  constraints provide the data to assess the effort
  it will take to change
• Associated costs relate to areas where there may
  be funding or staffing required

Design Criteria Effort to Change Costs
Issues
Associated Improve
Hardware
Kentucky Processing Times Medium
Derby set-up
Reconfigured
may change
Office Space
timing Reduce duplicative High
Training Old
activities efforts
continue
until 12/99
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Develop to-be organizational characteristics
STEP 4
Organization Structure
Leadership
Staff Development
Recruitment/ Deployment
Rewards/ Incentives
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Develop criteria and leadership skill and
competency needs
Leadership
STEP 4

• Public sector environment makes this an important
  activity
• Guides executive leadership in making political
  decisions
• Create leadership action plans that detail
  necessary communications and actions

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Identify and define the rewards and incentives
that you can use
Rewards/ Incentives
STEP 4

• Existing statutes and resource constraints
  somewhat limit ability to provide rewards and
  incentives
• With leadership support there are still many
  opportunities to recognize employees
• Well-defined performance measures will make
  assessment of who deserves rewards and
  recognition easier and fair
• Well-defined career path can also contribute

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Create staff development needs for the new
organization
Staff Development
STEP 4

• What skills or competencies will be needed? Do
  they need to become part of class specifications
  requirements?
• Define agency approach to training in
  administrative services area and required
  trainings
• Develop guidelines for management and staff
• Promote development of career plan that
  includes training plans and significant career
  milestones
• Define performance measures (e.g., reduce
  documentation preparation and approval time by
  one-third).

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Define future approach to recruiting and
deploying new employees
Recruitment/ Deployment
STEP 4

• Create list for future administrative services
  recruitment needs
• Create agency specific selection guidelines that
  may include knowledge, skills, and abilities
  requirements
• Develop a career path using existing class
  specifications and new class specifications
  provided by the Finance and Administration
  Personnel Cabinets

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Determine key organization model components
Organization Structure
STEP 5

• Use the design criteria, performance objectives,
  and list of influences and constraints
• Review the common organizational design models
• Assess criteria using Fit Model
• Blank Fit Model is in your handouts and will be
  in the folder sent to you next week

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There are some common organizational models that
can help
Organization Structure
STEP 5
Customer
Process- Centered
Functional
Hybrid
Geographic
Service
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Example of Organizational Fit Charting
Organization Structure
STEP 5
Geographic
Process
Design Criteria
Customer
Service
Functional
Enhances Responsiveness Encourages
Innovation Provides Streamlined Structure and
Processes Provides Flexibility to accommodate
environmental change Focuses on core
competencies Improves Cost efficiency/effectivene
ss of service Enhances work environment

High
Medium
Low
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Develop Organization Alternatives -- Create and
select models that will work for your agencies
Organization Structure
STEP 5
Process-Centered Hybrid
Customer Focused Hybrid
Agency Head
Agency Head
Functional COEs
Func 1
Func 2
Func 3
Func 4
Func 5
Customer Owner 1
Customer Owner 2
Customer Owner 3
Process Owner 1
End to end process
Process Owner 2
End to end process
Function Owner 1
Function Owner 2
Function Owner 3
Process Owner 3
End to end process
Centers of Expertise
Agency Head
Geographic Focused Hybrid
Geography Owner 2
Geography Owner 3
Geography Owner 1
Function Owner 1
Function Owner 2
Function Owner 3
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To-be models to consider
Organization Structure
STEP 5

• Models address the structure only
• Two agencies could have the same structure, but
  not be equally effective or efficient due to
  differences in their other processes
  characteristics
• Goal is to reduce the number of approvals and the
  redundant activities

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Create your model organization
Organization Structure
STEP 5

• Using the organizational fit model, the design
  criteria, and the sample models, develop a
  directional design for your administrative
  services organization
• Hybrids of different types of models are common
• Models need to support the business processes
• Dont need to get into the specific details of
  the design yet

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Then apply to your agency To-Be Model
Centralized and Geographic Primary/FunctionalSec
ondary
Organization Structure
STEP 5
Finance Administration Cabinet
Agency
Department
Department
Department
Department
or Office
or Office
or Office
or Office
Approval 3
Approval 2
Division/Region
Division
Division
Branch
Administrative
Branch
Approval 1
Origin of Transaction
Financial
Branch
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Begin to define the new structure
Organization Structure
STEP 5

• Each component of the new structure should have a
  purpose statement and a defined activities set
• Policies and procedures for the new structure
  will need to be developed
• Cross walk roles from the to-be roles for
  Administrative Services to the structure
• Reassess associated costs to changethe new
  structure may have introduced new needs

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Develop a briefing document for the new
organization
STEP 6

• Becomes a roadmap for leadership and employees
• Outline provided in handouts and in the documents
  we will provide to you
• Clarifies and integrates all of the
  Organizational Infrastructure Processes and
  Characteristics
• Creates the justification and need for change

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IMPLEMENT
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Key implementation factors your agency should
consider

• Communications
• Workforce Transition
• Training Needs
• Organizational Readiness
• Number of Affected People
• Degree of Impact
• Geographic Dispersion
• Timing
• Executive Leadership Support

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Timing of implementing the structural changes can
be as critical as the structure itself...

• Freeze on Executive Orders and Administrative
  Orders that will affect Chart of Accounts through
  August of 1999
• Capacity to change and achieve desired benefits
  given limited resources
• Uncertainty about the exact impact the system
  will have on an agencys operations.

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Create an implementation plan that addresses each
of these factors
Implementation Plan
Factor Agency approach Timing Assigned
responsibility Status
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Ensure the effectiveness of the implementation

• Measuring the agencys ability to meet the design
  criteria and performance objectives after
  implementation is critical
• Continuous improvement should become a part of
  the agencys culture (maybe made formally)
• True effectiveness will take time. Make sure to
  measure and acknowledge the small successes.

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Questions????
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Thank You!!!