Go­ver­nance Mo­del

Achieving strategic goals depends on clear roles and responsibilities. Changes to a company’s strategic direction should also be reflected in its governance. There are many reasons why companies should evolve their governance models. For example:

• Making a matrix structure with regional and functional responsibilities work,
• Organising cross-sectional tasks, e.g. designing company-wide business processes,
• Clarifying the interaction between central and decentralised units in groups,improving the value contribution made by IT by means of effective IT governance, restructuring organisations in the context of M&A or
• Defining procedures for prioritising and making investment decisions.

The fundamental challenge lies in establishing a comprehensible, coordinated set of rules for strategy-based management and control. Unclear or contradictory guidelines lead to the inefficient use of resources, weaken decision-making accountability as well as implementation, and promote energy-sapping conflicts on a personal level.

The key questions a governance model has to answer therefore relate to the clarity and suitability of rules:

• Management model: how are objectives and their tasks reflected in the company's structure?
• Avoiding complexity: have areas of responsibility been designed holistically and with minimum overlaps? Do they make it clear what each staff member’s role is?
• Controllability: are responsibilities assigned in line with the ability of people to achieve the corresponding objectives?
• Balance: are business units linked in a framework which balances their power and ability to exercise mutual control? Does the framework efficiently promote actions that are in the company’s interest?
• Interaction: have the responsibilities of business units been specified in alignment with relevant decision areas and processes? Have effective mechanisms been put in place to regulate their interactions (e.g. committees, rules for decision-making, escalation paths?

CTcon will assist you in analysing, developing and sustainably implementing governance models. Our expertise in corporate management, as well as our management training and change management track record, speak for themselves.