P.1 Organizational Description

Purpose

This Item addresses the key characteristics and relationships that shape your organizational environment. It also addresses your organization’s governance system. The aim is to set the context for your organization and for your responses to the Criteria requirements in Categories 1–7.

Comments

- The Organizational Profile provides your organization with critical insight into the key internal and external factors that shape your operating environment. These factors, such as the mission, vision, values, competitive environment, and strategic strategic challenges, impact the way that your organization is run and the decisions you make. As such, the Organizational Profile helps your business understand better the context in which it operates; the key requirements for current and future business success and organizational sustainability; and the needs, opportunities, and constraints placed upon your organization’s performance management system.

- Use of such terms as “purpose,” “vision,” “mission,” and “values” varies depending on the organization, and some organizations may not use one or more of these terms. Nevertheless, you should have a clear understanding of the essence of your business, why it exists, and where your senior leaders want to take the business in the future. This clarity enables you to make and implement strategic decisions affecting the future of your organization.

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

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

- In supplier-dependent 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, and customized manufacturing or services.