DDBA 8521 Week 3 Process Workaround Audit Example

The Buyers' Private Supplier List as a Finding: A Workaround Audit at a Valve Manufacturer Whose Purchasing Staff Phone In Urgent Orders the ERP System Would Delay, and What Their Workarounds Say About the Process as Designed

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Walden University

DDBA 8521: Seminar in Change Management

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Month Day, Year

The Buyers' Private Supplier List as a Finding: A Workaround Audit at a Valve Manufacturer Whose Purchasing Staff Phone In Urgent Orders the ERP System Would Delay, and What Their Workarounds Say About the Process as Designed

The Process as Designed

Midstate Valve, a composite maker of industrial valves for water utilities and chemical plants in Ohio with about 430 employees, adopted a new enterprise resource planning system in 2023. Under the designed purchasing process, a buyer enters a requisition, the system checks it against an approved supplier list maintained by the supply chain department, routes it for approval if it exceeds $5,000 and releases a purchase order, usually within two to three business days. Approved suppliers were chosen centrally in 2023 for price and payment terms. The process was meant to cut purchasing costs and give management visibility into spending.

The Workarounds

Interviews with all seven buyers and a review of six months of purchase records found three workarounds. First, every buyer keeps a private list of suppliers, mostly small local machine shops and distributors, that deliver reliably within a day. Four of these are not on the approved list. Second, when production needs a part urgently, buyers phone the order to a supplier on their private list, have the part delivered and enter the requisition afterward, sometimes days later, so the system records an order that was already filled. In the six months reviewed, 214 of 1,930 orders, about 11 percent, were entered after the goods had arrived. Third, buyers split some orders just under $5,000 to avoid the approval step, which takes an average of 1.8 days.

Workarounds as Findings

Alter (2014) defined workarounds as goal-driven adaptations, improvisations or other changes to systems or processes that people make to overcome obstacles or deal with mismatches between the system and the situation. Read that way, each workaround is a finding. The private lists show that the approved supplier list was chosen for price and terms but not for speed, and that for urgent parts speed matters more. The after-the-fact entries show that the designed process has no path for emergencies: it assumes every need can wait two to three days, and production says otherwise about one order in nine. The split orders show that the approval threshold is set where it slows routine work without adding much control, since approvers approved 98 percent of requests above it.

What the Workarounds Protect

The workarounds have a cost: spending outside the approved list, orders invisible to the system until after the fact and approvals evaded. But they also protect the plant. Production supervisors said that without the buyers' private suppliers, two lines would have stopped several times in 2025 for want of parts costing a few hundred dollars. Ford et al. (2008) caution that what managers label as resistance or noncompliance can reflect commitment to the organization's goals; the buyers are noncompliant in order to keep production running.

What the Audit Recommends

Stamping out the workarounds would make the official process look better and the plant run worse. Instead, the process should absorb what the workarounds reveal. Add an emergency purchase path, with a lower documentation burden and after-the-fact approval limited to a dollar amount and a weekly review. Add the four reliable local suppliers to the approved list in a category for urgent parts, with terms negotiated for speed. Raise the approval threshold to $10,000 or review it against approval rates. Lewin (1947) described change as moving from one quasi-stable equilibrium to another, held in place by opposing forces; the buyers' workarounds are the forces the 2023 design ignored, and a new equilibrium needs to include them.

Why the Workarounds Persisted for Three Years

The workarounds were not hidden. Production supervisors knew buyers phoned suppliers directly, and the controller's monthly report showed late-entered orders as a line item. Yet nothing changed in three years, because each group gained from the arrangement. Production got parts quickly, buyers kept their reputation for keeping lines running and the supply chain department could report that 89 percent of orders followed the designed process. Only the gap between the official process and actual work went unaddressed. That stability is itself a finding: the organization had settled into a workable equilibrium that the official process did not describe, and any change to purchasing should start by naming it.

Limits

The audit relies on buyers' accounts of urgency, which they have reason to emphasize. A sample of the after-the-fact orders was checked against production schedules and confirmed urgent in 18 of 20 cases, which supports their accounts but does not settle every case.

References

Alter, S. (2014). Theory of workarounds. Communications of the Association for Information Systems, 34, Article 55. https://doi.org/10.17705/1CAIS.03455

Ford, J. D., Ford, L. W., & D'Amelio, A. (2008). Resistance to change: The rest of the story. Academy of Management Review, 33(2), 362-377. https://doi.org/10.5465/amr.2008.31193235

Lewin, K. (1947). Frontiers in group dynamics: Concept, method and reality in social science; social equilibria and social change. Human Relations, 1(1), 5-41. https://doi.org/10.1177/001872674700100103