Session 10: Delegations of Authority Presented by: Andrew CookePricewaterhouseCoopers.

Session 10: Delegations of Authority

Presented by:• Andrew Cooke PricewaterhouseCoopers

What would you like to grow?

whatwouldyouliketogrow.com.au

Delegations of Authority

ANZUIAG Conference2010

What would you like to grow?PwC

Setting the scene

GFC

Growth through better business decisions

Risk culture

Empowerment of staff

Cut through the red tape

Make people more accountable

3


Agenda

Delegation of Authority

What benefits can it bring

A delegation decision model

What are some common problems

Key insights

The USQ experience

Questions

4


Delegation of Authority

• Authority to make business decision

• Support accountability and governance

• Responsibility / accountability / authority

• Forms the basis of your decision escalation process

• Single source of truth or guiding principles

5

Successful organisations exhibit characteristics of structural clarity through formal and informal accountabilities

Informational accountabilities(Underpinned by leadership style,

culture, trust, operating principle/values etc)

Formal accountabilities

Clearly definedand documented

Assigned to expertisewith ability to act

Congruent acrossmultiple dimensions

Open and robustcommunication

Constant learning andeducating from failure


What benefits can it bring

• Empowers employees

• Provides or builds on your internal structure

• Protects your assets from undue risks or liabilities

• Provides alignment of resources to decision making

• Embeds risk appetite and tolerance throughout your organisation

• Provides greater clarity on what is truly important to your organisation

6


A delegation decision model

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Decision models

Governance structures

Delegations of authority

Key decisions

Organisation structure

Policies and

standards

Skills and competencies

Processes and procedure

Governance processes

Job description

Descriptor Term Definition

A Accountable Person or role who is ultimately accountable for the decision, who owns the outcome from the decision.An Accountable must signoff (Approve) on work that a Responsible provides

R Responsible Person or role responsible for ensuring that an item is completed / a decision is made. There is typically one role with a participation type of Responsible

I Informed Person or role that needs to kept informed of the status of the decision making process – usually one way communication on completion

C Consulted Person or role whose subject matter expertise, knowledge, information or other input is required in order to make the decision


What are some common problems

• Complexity of DoA and business processes

• Misalignment of DoA and business processes

• DoA not aligned with organisational structure / decision making

• Ineffective decision making structures

• Lack of staff awareness and inappropriate training

• Failure to enforce (e.g. code of conduct breach)

• Poorly managed when staff in temporary roles

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Key insights

Guiding Principle vs Single Source of Truth

• Guiding Principle – high trust environment where levels of delegation are linked to accountabilities, tend to set parameters and are less prescriptive than a ‘single source of truth’3

• Single Source of Truth – the DoA is a single (central) prescriptive document for decision making and operational action

• Areas typically cover- Budgeted vs non-budgeted

- Capital and operating expenditure

- HR

- Pricing

- Contracts and supplier arrangements

- Marketing

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Key insights

10


The USQ experience

11

Decision models

Governance structures

Delegations of authority

Key decisions

Organisation structure

Policies and

standards

Skills and competencies

Processes and procedure

Governance processes

Job description

Strategy

Selection

RACI Model

Council and Mgt

Cmttee’s

ORMP - Budget

System workflo

w

Align for

reporting

Contract

Perf System

Access

Code of Conduc

t

ITFacilitie

s

Risk / Fraud


The USQ experience

12

Type Position Comments

Vice Chancellor $0 g h Unlimited

USQ: $5,000,000 Others: Unlimited

Deputy Vice Chancellor $0 g h h Unlimited

USQ: $250,000 Others: $500,000 Others: Unlimited

Deans of Faculties $0 g h h Unlimited

USQ: $100,000 Others: $200,000 - $250,000

Chief Financial Off icer $0 g h h Unlimited


Others: $100,000

Chief Operating Off icer $0 h h g h Unlimited

Others: $100,000 USQ: $250,000 Others: $500,000

Others: $200,000

Directors $0 g h h h Unlimited


Others: $50,000

Managers $0 h g h Unlimited

USQ: $40,000

Others: $20,000 Others: $50,000



Chief Operating Off icer $0 h h g h Unlimited

Others: $100,000 USQ: $250,000 Others: $500,000

Others: $200,000

Executive/Group Manager $0 h g h Unlimited

USQ: $100,000 Others: $200,000

Others: $50,000

Managers $0 h g h Unlimited

USQ: $40,000

Others: $20,000 Others: $50,000

Limit

Expenditure

Unlimited expenditure limits relate to appropriate cohort directors only

Expenditure limits dependant on appropriateness of manager.

CapexHalf of universites under analysis did not delegate authority to Managers for Capex

Half of universites under analysis did not delegate authority to Managers for Capex


The USQ experience

13




Deputy Vice Chancellor $0 g h h Unlimited


Chief Operating Off icer $0 h g h Unlimited

USQ:$250,000 Others: $500,000

Others: $200,000

Group Manager $0 g h h h Unlimited


Others: $20,000

Directors $0 g h h h Unlimited


Others: $20,000

Managers $0 h g Unlimited

Others: $20,000 USQ: $50,000

Others: $50,000


USQ: $6,000,000

Others: Unlimited

Chief Operating Off icer $0 h g Unlimited

Others: $100,000 USQ: $6,000,000

Chief Financial Off icer $0 h g Unlimited

Others: $250,000 USQ: $6,000,000

Directors/Group Managers $0 h h g h Unlimited

Others: $100,000 USQ: $6,000,000

Others: $50,000 Others: Unlimited

Chief Financial Off icer $0 g Unlimited

USQ: Unlimited

Others: Unlimited

Directors $0 g Unlimited

USQ: Unlimited

Others: Unlimited

Unlimited expenditure limit is w ithin select group only

Contracts

Generally included in regular expenditure delegations

Unlimited expenditure limits relate to appropriate cohorts only

Generally included in regular expenditure delegations



Limit

General Journals

Generally included in regular expenditure limits


Orders

Investments, Salaries, Leases, Overheads

Other University delegations relate to Board & Off ice Directors


The USQ experience

14


Chief Financial Off icer $0 g Unlimited

USQ: Unlimited

Others: Unlimited

Directors $0 g Unlimited

USQ: Unlimited

Others: Unlimited

Chief Financial Off icer $0 g h Unlimited

USQ: $5,000 Others: $100,000

Directors (Finance) $0 g h Unlimited

USQ: $5,000 Others: $100,000

Vice Chancellor $0 h g h Unlimited

Others: $25,000 USQ: $5,000,000 Others: Unlimited

Chief Operating Officer $0 h h g Unlimited

Others: $20,000 USQ: $5,000,000

Others: $5,000

Chief Financial Off icer $0 h h g Unlimited

Others: $25,000 Others: $50,000 USQ: $5,000,000

Executive Director $0 h g h Unlimited

Others: $5,000 USQ: $50,000

Others: $100,000

Purchasing Card Chief Financial Off icer $0 h h g h Unlimited

Others: $100,000 Others: $250,000 USQ: $6,000,000

Others: Unlimited


Limit

Cheques

Tw o signatories required in all circumstances for all universities under analysis

Tw o signatories required in all circumstances for all universities under analysis

General Journals



Write-offs

Large w rite-offs generally chanelled through Vice Chancellor

Write-offs split into categories. Large w rite-offs chanelled through Vice Chancellor

Write-offs split into categories. Large w rite-offs chanelled through Vice Chancellor

Write-offs split into categories. Large w rite-offs chanelled through Vice Chancellor. No authority given to directors at some universities.

What would you like to grow?

Questions

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Session 10: Delegations of Authority Presented by: Andrew CookePricewaterhouseCoopers.

Documents

Transcript of Session 10: Delegations of Authority Presented by: Andrew CookePricewaterhouseCoopers.