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FVO meeting Dublin March 9/10 2011 Beyond compliance auditing!

FVO meeting Dublin March 9/10 2011 Beyond compliance auditing!. drs. Rob. S. de Heus EMIA RO; Head of the auditdepartment (CAE) Food and Consumer Product Safety Authority (VWA).

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FVO meeting Dublin March 9/10 2011 Beyond compliance auditing!

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  1. FVO meeting DublinMarch 9/10 2011Beyond compliance auditing! drs. Rob. S. de Heus EMIA RO; Head of the auditdepartment (CAE) Food and Consumer Product Safety Authority (VWA)

  2. The problem definedIf compliance to Reg 882 / 2004 is required but repeatedly offended, another approach to auditing is preferred. (wondering versus verifying)

  3. Compliance / conformity is about…‘to do or not to do’, butthat’snolonger the questionwhen employees frequently do notcomply

  4. 3 starting points for (internal) auditing • Do we have a problem? (Problem detection); • What is the cause of the problem (diagnostic); • How do we assess the proposed solution? (design testing).

  5. Double loop learning (diagnosticauditing)Assessing the assumptions / ideas and standards Single loop (Complianceauditing)consistencybetweenoutcome and standards steering system Verificating system Measuringoutcome Steering signal Operating system input output

  6. Internal (management) controlTo find solutions for these issues, we have to pay more attention to management control, …but, what is management control?

  7. Anthony: “The process by which managers influence other members of the organisation to implement the organisation’s strategy.” Management Control John Kotter: “The central issue is never strategy, structure, culture or systems. The core of the matter is always about changing the behaviour of people.”

  8. Management control issues (Kenneth A. Merchant, 1998) • Lack of direction (Do they understand what we expect of them …) • Personal limitations (Are they capable of doing what is expected of them ... • Lack of motivation (Will they work consistently hard and try to do whatis expected of them ...)

  9. ThesisIf all the employees know what should be done and are capable of acting so and are willing to do so, then complying to any rule or regulation is no longer an issue!

  10. In otherwords: How does management take care of employees …. • Knowing what to do; • Make them capable for their duties; • Preparing willingness to do what is asked for.

  11. All employees have to fill in their time sheets • within the first week of the new month, but they don’t do this! Example 1) Solutions • Employees are automatically informed (by the computersystem) when they have to fill in their time sheet. A hyperlink in the programme gives direct acces to the time codes table.

  12. Example 2) Deficiencies are not documented Solutions: Allocate documentation-time in the planning; Discuss importance with them; so they know something is done with the documents

  13. An incorrect model health certificate is been used Example 3) Solutions: Programmed solution; the system always gives the most actual certificate

  14. Implications; 1) focus on management issues!... Audit should direct the attention to the management actions to prevent • Lack of direction • Personal limitations • Lack of motivation

  15. Implications 2) …and take a look at…! Examples of control actions by management

  16. Implications 3) add value! • By … • Paying attention more to causes than to problems / non-compliance only, and • Directing attention also to (sustainable) solutions • …auditing will deliver more added value to management

  17. Implications 4) Challenges! • It’s very challenging for auditors to give an opinion on the causes of non compliance, because.. • There is no standard or checklist • Auditors will be confronted with different perceptions • Auditors will wonder if they are in the right position to assess… • Auditors will wonder if they can conclude on the basis of subjectivity and opinions when there is lack of objectivity and/or facts

  18. Implications 5) It’s possible! • But; we can do it !! There is already much to conclude from: • Missing actions (e.g. no supervision, no communication) • Inconsistencies (e.g. conflicting instructions) • Redundancy / overkill (e.g. unnecessary checks and balances while management wants to trust on employees expertise) • People’s attitude / motivation ( e.g. the way they speak about their work)

  19. It’s not very effective to repeatedly conclude that our organisation is behaving in a non compliant way. We can deal with this problem by changing the focus of our internal audits to a more diagnostic approach. By doing this, we can define the underlying causes of non compliance and suggest ways to solve these issues. In this way we really increase added value to management! Conclusions

  20. Do you have any questions or remarks? ?

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