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Organizational Analysis

Owing to non-profit charitable trust nature and scope of SKMT the possibility of litigation against it

would always remain at higher side. It is admitted fact that the exposure of charities to liability goes

further than the loss of charitable assets and/or the insolvency or winding up of a charity. Directors

of charities may also face possible legal action against them personally by donors, members, third

parties and governmental authorities for breach of their fiduciary duties or even breach of trust in

failing to adequately protect or apply the assets of a charity. Analyzing the financial issues of the

organization for example:

Are all salaries & benefits being paid by SKMT on timely basis with appropriate reports to

BOG?

Are investments being offered to the public without full disclosure to potential investors?

Is there an audit committee in place?

REVENUE (IN MILLION)

YearHospital

ServicesZakat Donations

Other

Income

Total

Revenue

Dec 2013* 2,609 1,946 1,509 149 6,212

Dec 2012 2,202 1,669 1,156 165 5,192

Dec 2011 1,972 1,345 904 68 4,289

Dec 2010 1,554 807 608 44 3,013

Dec 2009 1,281 865 620 47 2,813

Dec 2008 1,125 646 460 37 2,268

Given the increased risks to charities and directors/ governors, there is an increasing need to

initiate/ develop for every possible risk a pre-formulated plan deals with almost every possible

consequence of a risk and ensures contingency if the risk becomes a liability.

Why Change?

In second stage we determine the degree of Choice whether to develop a change or the Change

Vision

The change was not regarding to change the vision of organization. The change was to create a new

department that keeps checks on all legal issues and also on processes within the organization.

Does the need for change is strong enough to begin searching for some form of action?

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Yes! In order to create organizational awareness related to legal risks involved and their possible

management at all levels of command i.e. Chairman, BOG, and Managers, departmental heads,

supervisors and staff.

Is there acceptance or tolerance for the status quo?

According to Beckhard and Harris change model we have these four responses

(1) People are relatively satisfied,

(2) Not dissatisfied to the point of being provoked to look for alternatives,

(3) Believing that nothing can be done,

(4) Believing that the costs of changing are such that they choose not to make those changes.

In this scenario people were not ready to accept the change because they think everything was

smooth, they were satisfied with the current systems but in actual there was no accountability for

any legal issue with the previous system.

They were also hesitating to accept because they knew after the development of this change they

have to be answerable for their all responsibilities.

The desired future state

All these issues need to be resolved to ensure a smooth process in the organization by:

Review of key documents

Completion of records

Utilizing other entities

Board relating issues

Insurance considerations

Proprietary issues

Human resources

Charitable and fundraising activities

Financial issues

Maintaining charitable registration

Contractual relationships

Communication

Policy making

The present state

There is lack of correspondence among the departments which triggered the need for change in the

organization.

There were no contractual obligations. All the documentation was verbal before.

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So much time was wasted when any important document was needed.

People didnt have the idea of the mission and vision of the organization.

People were not aware of the processes.

GAP analysis

The comprehensive plan is needed to provide a broad checklist which sketches a brief outline of

some of the more important issues that trustees, directors and/or executive staff of SKMT may need

to consider in ensuring due diligence in the operation of the organization, as well as an overview of

liability exposure and some of the steps available to protect against such risks. It may operate as a

standard legal risk managers expert opinion.

Action Planning and Implementation

First of the circulated email to all the relevant employees that the original copy of each document

will be saved in the law office and only certified copies will be issue to the relevant departments

It is mandatory that the law office first approve the document and then further used.

A flow chart was introduced of who reports to whom to take almost 2 years to making people

understand to follow the procedures. Some people were thought to be resistant but they did not

resist and accepted the change where as few were thought to be cooperative but they resisted.

Training sessions were conducted to tell people that it is in best interest for them as well as

organization. As CEO was very cooperative, so it helped a lot. Still the organization is in learning

process.

Measuring the change

MR ANEEL SAGAR (Manager legal affairs and risk management) established certain standards to

monitor the change and to measure the performance, after measuring the performance against

standards then next step is that performance will be compared with past data.

Positive performance will be recognized and in-case of any loop hole experienced in the system,

corrective actions will be taken, as system evolves with the passage of time and every system needs

some time to adjust. Per limitations found in the system standards will be amended accordingly.