Managing change Internal Audit s role in transformation journey

Transcription

1 Managing change Internal Audit s role in transformation journey V. Vatsaraman Vice President Internal Audit Emirates Group

2 Agenda What is Change and Change Management Role of Internal Audit in the transformation journey Some experiences from Emirates Group Internal Audit Q&A

3 What is change? Change in simple terms means make something different from what it is

4 What is change in business context? In the business or organisational context, change means altering one or more of organisation's elements to improve the organisation s internal effectiveness and efficiency or survival and growth in the market place. Strategy Stakeholders Structure Change Systems Products Processes

5 Change continuum Developmental Improve existing Improve billing process Enhance accounting system Update travel policy Transitional Replace / add to existing Replace accounting system Introduce new product/service Corporate restructure Acquisitions /divestments Transformational Reshape completely Radical change in technology/solutions Strategic shift Business model change

6 What is change management Given the above context of change, the following definition is a simple one: Change management is the coordination of a structured period of transition from situation A to situation B in order to achieve lasting change within an organisation (BNET Business Dictionary)

7 Change management Project management Current state Transition Future Change management

8 Change life cycle Identify need for change Sustain Evaluate change options Measure effect Plan the change Implement change

9 IA s interest in change Change in the business context is thus driven by: o Need to mitigate risks/shortcomings o Exploit opportunities By virtue of its definition, Internal Audit (IA) has advisory and assurance stakes in the change management initiatives from the risk management, operations improvement and value adding perspectives

10 Potential IA roles in transformation journey Life cycle stage Potential IA roles Identify need for change Validate the need Evaluate change options Validate rationale for the options. Identify and assess relative risks and opportunities Plan the change Validate plan for adequacy of adoption actions, risk mitigation and exploitation of opportunities Implement change In-flight assessment of risks and mitigation measures and how opportunities are being addressed Reflect on what was done and how learning for the future Measure effect Assess benefit /objective achievement Assess adoption Sustain Assess adoption Identify and assess risks and potential for further leveraging

11 Emirates Group IA s Experience

12 Emirates Group Comprises dnata Emirates Airline Grown with Dubai and UAE

13 Dubai then and now

14 Emirates then and now

15 An overview of Emirates

16 An overview of dnata

17 Types of changes in Emirates Group The growth of Emirates Group involved various changes in all three categories odevelopmental, otransitional otransformational

18 IA s role in change management IA s role in the various changes depends on the context of the change initiative. At times it covers the full cycle and at times specific stages The types of engagement also varies depending on situation: Advisory Risk assessments Health checks Concurrent reviews (instream reviews) Pre-implementation reviews Post implementation reviews Considering the magnitude of impact the focus is more on the Transitional and Transformational changes Based on IA s risk assessment and management requests Many of the Transitional and Transformational changes are IT enabled / IT based

19 IA s roles in changes over the years (indicative) RDBMS introduction Open system migration IT budgeting process Airline station accounting process and solution Airline revenue accounting process and solution Commercial MI/DSS Airport resource management process and solution Microsoft Office solutions Extended software development center Airline loyalty program launch Global data Communication Agreement Acquisition of source code of airline reservation and departure control systems ERP Implementation ecommerce launch Engineering solution replacement EFT introduction Business Rewards program for Airline SME customers Replacement of airline station accounting Future passenger services solutions BI ERP options Cloud and managed services Restructuring in Finance and Commercial areas Risk mitigations, leveraging of opportunities and learnings

20 Recent example: Future PSS Future Passenger Services (Future PSS) change initiative is a blend of Transitional and Transformational changes 4 year programme with a large bouquet of new solutions third-party and own - being added around the existing system Involves significant business process changes. Feeds into other futuristic initiatives in the passenger services space

21 IA s role in Future PSS initiative Performed risk assessments of alternative options which fed into the decision process Holds observer positions in Steering Boards Reviews the programme risk status periodically as well as the state of risk mitigation actions Reviews key projects in-flight Health checks Pre-implementation reviews Reviews benefit tracking as projects go on-stream Provides reflections on things that were done well and that could have been done better for future learning Provides an independent perspective to the Executive Management regarding the state of the change program

22 Q&A

23 IA definition "Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization s operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes." - The IIA