Chapter 14 Committees in the business organisation

1. Chapter 14 Committees in the business organisation

2. ChapterOutline COMMITTEES ROLE & PURPOSE CHAIRPERSON & SECRETARY TYPES ADVANTAGES DISADVANTAGES

3. Committees • Within an organisation, committees can consist entirely of executives or may be instruments for joint consultation between employers and employees. • They are a key part of organisational communication processes.

4. Definition: Committee • A group of people to which some matter is committed • 2 types: • Ad hoc • Formal committee • Committees: • Are permanent • Have authority • Follow well established procedures • Provide a well tried way of resolving difficult decisions

5. Features FEATURES Rules of procedure Chairperson & secretary The minutes of the meeting which are the official record of what has taken place Notice – announcement of the meeting prepared & circulated in advance Committee papers & reports to help committee make well informed decisions or proposals Agenda setting of what is to be discussed & in what order

6. Features cont… • Rigid procedure about: • Speaking • Voting rights • Proposing the motion & meetings • Rights of attendance • The construction of the agenda • Adding emergency items to the agenda • Quorum (minimum no of members required for the meeting to take place)

7. Rules of procedure • To promote the smooth running of a committee • Ensures consistency & fair play • Enable both sides in an argument to state their case • Minimises the effect of bullying tactice • Ensures proper record of all proceedings are maintained

8. Rules of procedure • Convening meeting acc. to. Articles of Association • A meeting may only proceed if it has been properly constituted – meets all the criteria laid down regarding attendance & conduct. • If there is no quorum, the Chair has 2 options: • To make the meeting a discussion group • To adjourn the meeting to a later date • Procedures may also be defined regarding the conduct of the meeting. Each item of business may be required to be put before the meeting as a proposal or a motion. This usually requires a proposer & a seconder. If it is carried (approved), the motion becomes a resolution (decision).’

9. Rules of procedure • The original motion is sometimes amended and may then be carried in an altered form as a ‘substantive motion. • An amendment is a proposal to alter a motion that has been put before a meeting, but has not yet been put to a vote. • An amendment which simply adds words to the original motion is called an addendum. • Participants will then vote for or against a motion

10. Rules of procedure • A point of order is an objection about a perceived irregularity in the convening, constitution or conduct of the meeting. It is made to the chairperson, who makes an immediate ruling. PoO, ensures that regulations are observed. • Procedures re who is permitted to speak (proxies?)

11. Size and success of a committee Size: • Too large a committee may not give individuals time to give their point of view but if everyone spoke it would waste time • Too few in the group may mean a lack of breadth of expertise, or decisions may be made with insufficient deliberation.

12. Size and success of a committee Success: • Be representative of all interests • Have a chairperson with good leadership capabilities • Choose suitable subjects for action • Circulate reports prior to meeting • Have clear cut terms of reference, with areas of responsibility, timescales of operations & purpose specified in writing • Have the necessary skills & experience • Be worth the cost of its operation

13. The purposes of committees in an organisation TASKS DECISION MAKING CONSULTATION PROVIDING ADVICE & INFORMATION RELAYING DECISIONS & INSTRUCTIONS BRAINSTORMING PARTICIPATIVE PROBLEM-SOLVING

14. Types of committees used in the organisation • Standing – formed for a particular purpose on a permanent basis • Adhoc – are formed to complete a particular task • Audit – review the company’s accounting policies & internal controls, annual financial statements and the audit report with the company’s external auditors.

15. Examples of committees 1. Board of Directors – group of people legally charged with the responsibility to govern a company Purpose: • Lay down strategy, general policy & broad sectional policies • Ensure legal standards are met & the company is operating in accordance with its Articles of Association • Sanction capital expenditure & the method of disposal of profits • Ensure sufficient capital is available & maintain an efficient system to control the affairs of the company

16. Examples of committees • Steering committee – oversee a major project, generally IT based, within an organisation. Involved in deciding how to allocate scarce IT resources. • Role: • Ensure that all IT activities are in line with the strategic plans of the org • Provide leadership at senior level for the exploitation & management of IT • Ensure that resource allocation decisions are effective • Co-ordinate requirements in any org restructuring • Create the terms of reference for the project teams • Monitor the progress of the various projects

17. Work safety committee • Advisory committee, which meets regularly to discuss action required about unsafe working conditions/methods WORK SAFETY COMMITTEE Works manager HR manger Union representatives Safety manager Department representatives

18. The Accounting Standards Board (ASB) • ASB took over the role of setting accounting standards from the Accounting Standards Committee (ASC) in August 1990. • Aims to promote consistency in corporate reporting by creating financial reporting standards to which major businesses are expected to adhere

19. Ethics committees • Oversees the working practices & procedures in an organisation with respect to: • Conflicts of interests • Confidential information • Complaints of customers • Transactions involving related parties of the company

20. Advantages & Disadvantages of committees

21. Advantages & Disadvantages of committees cont…

22. How to overcome pitfalls of committees • Authority – clear lines of authority & responsibility • Size – committees should be large enough to promote deliberation & include the breadth of expertise required for the job but not so large as to waste time or foster indecision • Membership – careful selection of members. Members must be representative of the interests they are intended to serve & must also possess the required authority and be able to perform well in a group.

23. How to overcome pitfalls of committees cont… • Subject matter – should be limited to subject matter that can be handled in a group discussion • Minutes – careful minutes of meeting must be taken & circulated in draft form for correction or modification before the committee approves the final copy • Cost effectiveness – committees can be justified only if the costs are offset by tangible & intangible benefits.

24. Roles of the chair & secretary of a committee • One person at the meeting will act as chairperson & guide the proceedings • Responsibility: • Keeping the meeting to a schedule & to the agenda • Maintain order • Ensuring correct procedure is observed • Ensuring impartiality • Ascertaining “the sense of the meeting”, by summing up, or putting the issues to a vote & declaring the result • Depending on the level of formality of the meeting – checking & signing the minutes

25. Skills and knowledge • Effective chairperson must have: • Sound knowledge of relevant regulations • An awareness of non-verbal behaviour • Ability to summarise • Skill to communicate rulings clearly but tactfully • Ability to silence people in a firm & friendly manner • Ability to be decisive • Ability to ask opening questions

26. Secretary • Before the meeting • Fixing the date & time of the meeting • Booking the venue • Preparing & issuing the agenda & other relevant documents • During the meeting • Assisting the chairperson • Making notes • Advising the chairperson on points of procedure • After the meeting • Preparing minutes • Acting on & communicating decisions • Dealing with correspondence