Is Annex SL The Secret Weapon for Enterprise Engagement?
With the practices of Enterprise Engagement now required in 60 ISO standards, Deann Desai, convener for the ISO Technical Committee that manages the Annex SL management standard, believes it’s only a matter of time before CEOs get the message that today’s organizations need a strategic and tactical focus on all their stakeholders --customers, distribution partners, employees, vendors, and communities--that ISO and other business practices have overlooked.
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Does your organization or any of your clients follow ISO 9001 quality management or any of the 60 ISO standards listed here
? If so, there’s a chance you'll start seeing an increased interest in the concept of Enterprise Engagement coming from the C-suite in the coming years. Why? Because ISO requirements under Annex SL, potentially affecting two million or more companies worldwide, now require CEO-responsibility for a formal strategy and tactical plan for Human Capital Management. Chief executives at organizations certified in any of these 60 standards are now required to have a written plan that connects the dots between all internal and external stakeholders and the processes used to engage and equip them to achieve organizational goals. Annex SL was created to provide common terms and definitions for all 60 ISO management system standards to make it easier for organizations that have to comply with more than one standard.
According Deann Desai, the Annex JTCG Convener, many companies going through the current round of audits and certification are beginning a journey to address changes that require time and commitment. One of the biggest changes, in addition to having a clearly articulated people management system, is “the strategic focus on leadership.” She says the Annex SL standard eliminates the reference in previous standards to a “management representative.” Under the new standards, she emphasizes, the senior management’s responsibility is explicit and required. “One of the biggest changes in Annex SL is the focus on leadership and the role of people. Another key change is the connection to the business and the business context. The business context includes engagement of interested parties. These people issues are a part of an organization's journey in the development and maintenance of their ISO systems.”
The Need to Address All Stakeholders
Desai explains: “Ensuring that the organization's business goals are front and center is very important. This includes understanding the strategic and tactical risks. There are a lot of different people and organizations that have an interest in what you do as an organization. Understanding which ones you need to address is an important priority for top management. For instance, at an airline, you have passengers and employees, but you also have regulators, investors, vendors, airports, and residential communities surrounding the airports. An organization needs to take into consideration the needs of all these people, but you can't please everyone all the time. An organization needs to take all those stakeholders into consideration to determine where their needs match with where the organization needs to go. An organization has to set priorities, and it will get better results if it balances the need for all these parties with the business goals.”
She agrees that patience is required on this journey and that it is reasonable to give both organizations and certification bodies time to absorb the significance of these chances." In effect, Desai says, ISO had overlooked the fundamental role of people in achieving the best results from standards but needs to give organizations time to adapt.
"The changes an organization has to make to fully take on board all these changes in Annex SL--risk management, engagement, change management, etc.--will depend on the organization and what practices they currently have in place. It takes time for organizations to learn about the standards and to make the necessary changes. One of the goals of Annex SL is to improve engagement of senior management, and not just at the C-Suite level. That’s why we added an entire Section 5 entitled "Leadership," and by that we mean top management, mid-level management and operational management."
Many of the Annex SL provisions are requirements, she explains. “Many of the ISO Annex SL provisions are reflected in various ISO standards as requirements, meaning the auditors for 60 standards must audit for their fulfillment. In other words, like most ISO standards, Annex SL gives CEOs a free hand at deciding specifically how they seek to achieve organizational goals through a strategic and tactical human capital plan. What essential is the organization have such a plan and can demonstrate it."
The Need to Connect the Dots
Desai says that “management systems are really designed so that senior management, middle management, operations and employees are all on the same page with the same outcomes in mind, and that they’re all headed in that direction. The primary management value is to align strategic with tactical goals. The framework helps to provide a funnel for decision-making based on identifying the biggest risks and ensuring that the organization is properly addressing those risks. You need to determine both your strategic and tactical risks to determine your goals and strategy.”
So, ESM asks her: Do most companies achieving their ISO audits in those 60 standards this year really meet the requirements of the new ISO Annex SL management framework?
Desai says. “It takes time for people to learn about changes and how those changes impact their organization. One of the fundamental principles of management system standards is continuous improvement: developing a plan for engagement can be one of those improvements."
Auditors Need to See Progress
For now, she says, an informed and honest auditor will want “to make sure this time around that an organization is progressing toward this transition, but I don’t think it’s fair to expect an organization to go from zero to a thousand miles an hour. The people issue is just one of the new Annex SL requirements. This is a lot of change to manage and it’s fair to give organizations time.”
Desai believes that as executives become familiar with the standards and their economic benefits they will seize the opportunity. “In the U.S., many CEOs have a very short sight-line, so they’re not interested in a longer-term strategy. Other countries in the world take a longer view, and so have embraced Annex SL more enthusiastically,” she says, citing the Netherlands as an example.
While complying with Annex SL requirements demonstrates a strategic focus on people, there will be no new way for companies to market that commitment, since Annex SL is largely a requirement of standards widely followed for years. Says Lee S. Webster, co-founder of the International Center for Enterprise Engagement at TheICEE.org
, “This is one of the reasons we’re so excited about having the first ISO 10018 certifications: organizations following any of 60 ISO standards now need to essentially follow ISO 10018 and, if they do, they will automatically fulfill the full spirit of Annex SL and vice versa. Our aim is for ISO 10018 to become the universal symbol for people effectiveness, just as ISO 9001 is for quality effectiveness—as a means for organizations to perform better and to engage customers, talent, vendors, investors and anyone who can contribute to success.”
For more information on ISO Annex SL, click here
. Annex SL standards will be covered extensively at the Enterprise Engagement in Action
Conference, Oct. 3-4, hosted by the University of Texas at Arlington Enterprise Development Division, 20 minutes from the Dallas-Ft. Worth Airport.
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For more information, contact Bruce Bolger at Bolger@TheEEA.org, 914-591-7600, ext. 230.