The Annual Cycle Management Process

As service delivery is considered a process, so is its management a process. Management activities of an organization during a short, e.g. annual cycle consist of goal setting, planning, delivery of service and organizational performance review at the end of the cycle. Organizational performance coincides in most respect to management’s performance during the annual cycle but includes factors, mostly external, thus uncontrollable by management or administration.

While a particular agency has adopt different traditional terminologies the major steps in the management process begins with goal setting (1). The quantitative goal is confirmed for the annual cycle. The initial goal for annual service delivery operations is the current annual plan segment of the organization’s 5-year strategic plan. There are public organizations whose strategy spans two bi-annual plans. The strategic plan may be modified if during the previous cycle unexpected factors of service delivery unduly influenced operational performance.

The review of variances of actual performance measures to plan is the primary input to the goal step. Were there environmental or external factors that caused the actual performance of the organization to result in an under-plan situation? Have the standard operating productivity assumptions underestimated service delivery, causing performance to over-shoot plan? Were there newly recognized ethical, regulatory or legal issues that made it necessary to modify the goal for the service delivery operation?

Now that the target for the plan cycle has been determined, annual planning begins (2). The resources are now aligned to enable goal attainment. In most public financed operations the budget get such a paramount importance that the allocation of local, state and federal funds takes place. While these governmental organizations use budget process and planning process interchangeably, planning in the strict sense focuses. The differences between these important organizational activities lies in the degree of customer focus. Planning in a general sense of the term considers both the output and input to the organization as factors in the attainment of the organization’s goal. Questions often arise as to staffing adequacy at standard productivity in providing high quality service. Is there sufficient data processing band width to allow the completion of plan service transactions while providing the necessary management information? Are there sufficient budget or financial resources support the plan? During restricted budgetary environments, will the improvement in the delivery process result in levels of productivity that can meet long term service and quality goals? Once the assignment of input to desired output are confirmed, these are “written down” as the organization’s plan for the annual cycle.

The service delivery operation commences (3). At the end of each month, management receives the report summarizing the status of the organization in terms of key top line performance measures. The monthly variances of these measures included in the management information enable management to see in real time how the implementation of the plan is taking place. Any significant variance brought about by unexpected operational factor is noted for consideration during the performance review at the end of the cycle.

At the end of the annual operational cycle, the organization’s metrics are compared to plan (5). Did the controllable factors directed by standard operating procedures behave as planned? Will adjustments have to be made in the next cycle? Were their effects sufficiently significant to require changes in strategy and therefore strategic plan?

The management process described is an essential part of the principles of “good management” applicable not only to public organizations but also to private organizations. A well performing management process reduces management burden and increases moment-of-truth instances, as well as reducing the time clients are served and products consumed by customers.