Joint Co-Operators:

 This Audit Guide and commentary provides brief summaries of the Prime Project Criteria for Performance Excellence in Prime Project’s requirements and principles. It also includes examples and guidance to supplement the notes that follow each Criteria item and Principles for the Credibility Principles of Int’l Initiative Structures Principles.

 

1- Organizational Profile

Your Organizational Profile provides a framework for understanding your organization. It also helps you guide and prioritize the information you present in response to the Prime Auditors.

The Organizational Profile gives you critical insight into the key internal and external factors that shape your operating environment.

These factors, such as your organization’s vision, values, mission, core competencies, competitive environment, and strategic challenges and advantages, impact the way your organization is run and the decisions you make. As such, the Organizational Profile helps you better understand the context in which you operate; the key requirements for current and future business success; and the needs, opportunities, and constraints placed on your management systems.

Purpose

This item addresses the key characteristics and relationships that shape your organizational environment. The aim is to set the context for your organization.

Prime Commentary

*Understand your organization.

The use of such terms as vision, values, mission, and core competencies varies depending on the organization, and you may not use one or more of these terms. Nevertheless, you should have a clear understanding of the essence of your organization, why it exists, and where your senior leaders want to take it in the future. This clarity enables you to make and implement strategic decisions affecting your organization’s future.

 

*Understand your core competencies.

A clear identification and thorough understanding of your organization’s core competencies are central to success now and in the future and to competitive performance. Executing your core competencies well is frequently a marketplace differentiator. Keeping your core competencies current with your strategic directions can provide a strategic advantage, and protecting intellectual property contained in your core competencies can support your organization’s future success.

*Understand your regulatory environment.

The regulatory environment in which you operate places requirements on your organization and affects how you run it. Understanding this environment is key to making effective operational and strategic decisions. Furthermore, it allows you to identify whether you are merely complying with the minimum requirements of applicable laws, regulations, and standards of practice or exceeding them, a hallmark of leading organizations and a potential source of competitive advantage.

*Identify governance roles and relationships.

 Leading organizations have well‐defined governance systems with clear reporting relationships. It is important to clearly identify which functions are performed by your senior leaders and, as applicable, by your governance board and parent organization. Board independence and accountability are frequently key considerations in the governance structure.

*Understand the role of suppliers.

 In most organizations, suppliers play critical roles in processes that are important to running the business and to maintaining or achieving a sustainable competitive advantage. Supply‐chain requirements might include on‐time or just‐in‐time delivery, flexibility, variable staffing, research and design capability, process and product innovation, and customized manufacturing or services.

 

2- Organizational Situation

Purpose

This item asks about the competitive environment in which your organization operates, including your key strategic

Challenges and advantages. It also asks how you approach performance improvement and learning. The aim is to help you understand your key organizational challenges and your system for establishing and preserving your competitive advantage.

Prime Commentary

*Know your competitors. Understanding who your competitors are, how many you have, and their key characteristics is essential for determining your competitive advantage in your industry and marketplace. Leading organizations have an in‐depth understanding of their current competitive environment, including key changes taking place. Sources of comparative and competitive data might include industry publications, benchmarking activities, annual reports for publicly traded companies and public organizations, conferences, local networks, and industry associations.

*Know your strategic challenges.

 Operating in today’s highly competitive marketplace means facing strategic challenges that can affect your ability to sustain performance and maintain your competitive position. These challenges might include the following:

• Your operational costs (e.g., materials, labor, or geographic location)

• Expanding or decreasing markets

• Mergers or acquisitions by your organization and your competitors

• Economic conditions, including fluctuating demand and local and global economic downturns

• The cyclical nature of your industry

• The introduction of new or substitute products

• Rapid technological changes

• New competitors entering the market

• The availability of skilled labor

• The retirement of an aging workforce

*Know your strategic advantages.

 Understanding your strategic advantages is as important as understanding your strategic challenges. They are the sources of competitive advantage to capitalize on and grow while you continue to address key challenges. These advantages might include the following:

• Industry innovation leadership

• Customer service recognition

• Brand recognition

• Agility

• Supply‐chain integration

• Price leadership

• Reputation for quality and reliability

• Environmental (“green”) stewardship

• Social responsibility and community involvement

*Prepare for disruptive technologies.

A particularly significant challenge, if it occurs to your organization, is being unprepared for a disruptive technology that threatens your competitive position or your marketplace. In the past, such technologies have included personal computers replacing typewriters; cell phones challenging traditional and pay phones; fax machines capturing business from overnight delivery services; and e‐mail, social media, and smart phones challenging all other means of communication. Today, organizations need to be scanning the environment inside and outside their immediate industry to detect such challenges at the earliest possible point in time.