An organizational assessment of Delta Montrose Electric Association has been completed and a summary has been provided on the electric cooperative's website.
The assessment, which was conducted by a division of the National Rural Electric Cooperative Association, was a hotly debated topic prior to DMEA's annual meeting in June.
Candidates for the three board seats either dismissed the $70,000 management assessment as a waste of money or spoke out in defense of the board decision to conduct the assessment. Ed Marston, who lost his bid for re-election on DMEA, said, "We all need to know if the $193,698 average compensation paid in 2011 to DMEA's top seven managers is appropriate. We also need to know if the two top salaries — $266,820 and $217,410 — are appropriate. Does DMEA need two people at this level? The assessment should tell us that and more."
The summary shows the assessment did just that. After comparing like positions against salary and wage benchmarks for cooperatives of DMEA's size, the consultants determined compensation for DMEA employees is not out of line. But the organizational structure could use some "tweaking," according to the analysis. A "flatter" organization structure is recommended, to bring together like functions for greater focus and accountability, with direct oversight by the general manager. It's recommended the assistant general manager position be eliminated and that individual be redeployed as the chief engineering and technology manager. In addition to engineering and technology, other targeted functions are finance and administration; operations; safety and regulatory compliance; member services; and communications and public relations.
It was noted DMEA performs exceptionally well on its critical mission areas of safety, reliability, cost and member satisfaction. As measured by the American Customer Satisfaction Index, DMEA scored an 89 in its most recent satisfactory survey, a top score compared with national electric cooperatives.
Employees, however, are not as satisfied. After conducting interviews or holding employee sessions with the entire staff, the consultants concluded there are underlying trust issues between the board, management and employees which are negatively impacting the culture of the organization.
"For example, perceived conflicts between the board and top management are fostering a negative climate, rumors, confusion and poor attitudes," the summary states. "Employees don't feel that they are valued; this is at least partially driven from a perceived interest for DMEA to cut wages and employee benefits."
Several recommendations were made for improving DMEA's culture, beginning with strategies to improve the relationship between the board and top management.
Under operations, it was recommended the two operations center (Montrose and Delta) be consolidated into one location to provide greater efficiency, productivity and reduced cost.
Additionally, the summary notes that DMEA experiences relatively high write-offs — from 2010 to 2012, those write-offs totaled $1.5 million. It's recommended the billing cycle be redesigned and a deposit policy be implemented to reduce write-offs.
Altogether, the assessment resulted in 50 specific recommendations for improvement. They generally fall into five stategies:
1. Improve the relationship between board and management.
2. Re-engage the general manager to lead and manage DMEA for continued success.
3. Strengthen leadership across the management team.
4. Strengthen DMEA's financial planning capabilities.
5. Align resources to maximize performance.
"The board and general manager must move the organization forward in a positive manner," the summary concludes. "DMEA's employees desire a direction that improves the current situation. What is required at this time is a unified approach that demonstrates strong leadership by both the board and general manager. An employee comment from the survey results said it best: 'The need is for the board and management to be trustworthy, extending trust, clearly communicate direction, and lead by example.'"blog comments powered by Disqus