The modern organization operates in a dynamic environment where ambiguity and uncertainty abound. As an open social system that functions in a continuously evolving business context, the modern organization must determine the external and internal issues that are relevant to its purpose and its strategic direction, and continually align its governance and management models, in a manner that reflects the diversity of this context. Embracing an organizational resilience paradigm, augments traditional risk management efforts and promotes the optimization of key and enabling processes, across all functions and levels of the organization. On a practical level, organizational resilience can be instrumental in improving management performance and an impetus to anticipating future threats and opportunities. Moreover, it can reinforce the organization’s capacity to monitor developing trends, as well as its ability to respond proactively to a variety of events, while learning from past successes and failures. Finally, implementing an effective internal control framework, combined with sufficient internal audit processes, will ensure that operational and tactical actions are aligned with strategic priorities that are consistent with the culture of the business, and in line with the organization’s overall risk tolerance. In this work we make use of the cybernetic structure of the Viable System Model (VSM) to both identify and diagnose the pathologies commonly found in traditional organizations, and explore its practical potential, in developing and implementing redesign initiatives, which reinforce the organization’s resilience and agility.

The global financial crisis of 2008 has been rivaled only by the Great Depression of the 1930s. The breadth and duration of this crisis had an adverse impact on every national economy, reflecting the systemic interdependence of an interconnected economic ecosystem, and the strengths and weaknesses of individual countries, regions, and monetary policies. The economic crises was particularly disparaging to the Greek state, which has a long history of excessive public spending, massive tax evasion, wage growth not supported by proportional productivity, and unsustainable debt levels. The health of the economy was further eroded as a result of a lack of confidence that was driven by questionable accounting practices and the misreporting of economic performance indicators by successive governments. The Court of Audit of the Hellenic Republic1 operates as the independent external auditor for the Greek state. Its effective and efficient operation within its mandated boundaries will be instrumental in the nation’s economic recovery and a key preventing measure to arrest financial mismanagement in the future. This work will describe the context in which the CoA carries out its activities, and will explore the means through which the organization can apply a systems approach to its structure, function, and management paradigm for the purpose of reinforcing its strategic, operational, and tactical capacity.