Category and Item Commentary
This commentary provides brief summaries of the Criteria categories and items. It also includes examples and guidance to supplement the notes that follow each item in the Criteria booklet. For additional free content, and to purchase the Criteria, see http://www.nist.gov/baldrige/publications/business_nonprofit_criteria.cfm.
Preface: Organizational Profile
Your Organizational Profile provides a framework for understanding your organization. It also helps you guide and prioritize the information you present in response to the Criteria items in categories 1–7.
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 your organization’s vision, values, mission, core competencies, competitive environment, and strategic challenges and advantages, impact the way your organization is run and the decisions you make. As such, the Organizational Profile helps your organization better understand 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 on your organization’s management systems.
P.1 Organizational Description
This item addresses the key characteristics and relationships that shape your organizational environment. The aim is to set the context for your organization.
Understand your organization. The use of such terms as purpose, vision, values, mission, and core competencies varies depending on the organization, and your organization may not use one or more of these terms. Nevertheless, you should have a clear understanding of the essence of your organization, why it exists, and where your senior leaders want to take it in the future.
This clarity enables you to make and implement strategic decisions affecting your organization’s future.
Understand your core competencies. A clear identification and thorough understanding of your organization’s core competencies are central to organizational sustainability and competitive performance. Executing your core competencies well is frequently a marketplace differentiator. Keeping your core competencies current with your strategic directions can provide a strategic advantage, and protecting intellectual property contained in your core competencies can support sustainability.
Understand your regulatory environment. The regulatory environment in which you operate places requirements on your organization and impacts how you run it. Understanding this environment is key to making effective operational and strategic decisions. Furthermore, it allows you to identify whether you are merely complying with the minimum requirements of applicable laws, regulations, and standards of practice or exceeding them, a hallmark of leading organizations and a potential source of competitive advantage.
Identify governance roles and relationships. 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 parent organization. Board independence and accountability are frequently key considerations in the governance structure.
Understand the role of suppliers. In most 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, process and product innovation, and customized manufacturing or services.
2013–2014 Baldrige Criteria for Performance Excellence: Category and Item Commentary