Audit of Human Resources Planning

Audit Report

March 2018
Project Number: 80590‑104

Executive summary

Human resources planning is the process of identifying current and future human resources needs for an organization to achieve its goals. HR planning serves as a link between HR management and the overall strategic plan of an organization.

Over the last year, Statistics Canada has been implementing a new vision of a modernized workplace culture and approach to producing and collecting statistics, which has resulted in greater and faster access to statistical products for Canadians. HR is at the centre of modernization efforts, since key skills and competencies will be critical to supporting this corporate vision.

Because Statistics Canada is in the process of implementing this new direction, many HR processes have been transformed, including processes related to HR planning and the governance of HR management activities.

Building on a solid HR planning foundation, Statistics Canada is in a prime position to leverage opportunities to improve or enhance many of the existing processes in alignment with the goals of the modernization initiative.

Why is this important?

Statistics Canada is in the process of implementing a modernization initiative, and HR will be critical in supporting this corporate objective. HR will look ahead and put the necessary steps in place today to meet current and future HR needs.

Key findings

Governance processes over HR planning are in place to provide direction and oversight. Committees and subcommittees are designed to address all areas of HR management and provide support to the modernization initiative.

Roles and responsibilities for HR planning are clearly defined and documented throughout the organization. Additionally, key risks to meeting HR modernization objectives have been defined and mitigation strategies have been identified in order to effectively manage these risks.

HR planning processes are in place with many of the key components needed to develop an integrated HR and business plan.

Objectives and business goals have been defined and work has begun to develop an understanding of the environment and identify skill gaps. The Human Resource Branch works with programs and committees to identify and address short and long term needs in order to develop recruitment and staffing options.

Some HR strategies have been developed to meet new and emerging agency-wide critical skill sets but have not yet been finalized in an overarching consolidated plan. This is largely because the organization is transitioning to support the new modernization agenda. There are opportunities to improve the structured and integrated approach of the planning process by creating a plan and tools for obtaining more granular information in the future that will allow for more precise identification of HR needs in the modernization context.

Lastly, as the organization develops its long-term vision for HR planning, it should develop monitoring approaches with concrete targets to measure the success of this strategy.

Overall conclusion

Statistics Canada has established an HR planning framework to address current HR business needs. HR planning processes for longer-term business needs in the new context of modernization have not yet been developed agency-wide.

Conformance with Professional Standards

The audit was conducted in accordance with the Internal Auditing Standards for the Government of Canada, which includes the Institute of Internal Auditors (IIA) International Standards for the Professional Practice of Internal Auditing.

Sufficient and appropriate audit procedures have been conducted and evidence gathered to support the accuracy of the findings and conclusions in this report and to provide an audit level of assurance. The findings and conclusions are based on a comparison of the conditions as they existed at the time, against pre-established audit criteria. The findings and conclusions are applicable to the entity examined, and for the scope and time period covered by the audit.

Steven McRoberts
Chief Audit and Evaluation Executive

Introduction

Background

Human resources (HR) planning is the process of identifying current and future HR needs for an organization to achieve its goals. HR planning serves as a link between HR management and the overall strategic plan of an organization. At Statistics Canada, HR planning and staffing is a shared responsibility between program managers and the Human Resources Branch (HRB).

Program managers are directly accountable for staffing decisions, while HR advisors support program managers by identifying possible staffing strategies, taking into account established rules and regulations.

Over the last year, Statistics Canada has been implementing a new vision of a modernized workplace culture and approach to producing and collecting statistics, which has resulted in greater and faster access to statistical products for Canadians. HR is at the centre of modernization, since key skills and competencies will be critical to supporting this corporate vision.

Because Statistics Canada is in the early stages of this new direction, many HR processes are in a state of transition, including processes related to HR planning and governing HR management activities.

As a result, Statistics Canada is in a prime position to leverage opportunities to improve or enhance many of the existing governance structures, policies, and processes, while ensuring they are aligned with the goals of the modernization initiative.

Audit objective

The objective of the audit was to provide assurance to the Chief Statistician and Statistics Canada’s Departmental Audit Committee that

  • there is an HR planning framework in place that aligns with the organization’s current and future business needs.

Scope

The scope included an examination of Statistics Canada’s HR planning activities for coordinating and managing staffing activities, as well as a review of how well HR planning activities are supported by an appropriate governance structure that defines accountabilities and objectives aligned with broader corporate strategies and plans. The period covered by the audit was from April 1, 2017 to December 31, 2017.

Approach and methodology

The audit work included an examination of documents, testing, and interviews with the Human Resource Branch, Field Managers and a sample of divisions. The audit tested for compliance with relevant Treasury Board of Canada Secretariat (TBS) and Statistics Canada policies and guidelines (see Appendix A: Audit Criteria for details).

The audit was conducted in accordance with the Internal Auditing Standards for the Government of Canada, which include the Institute of Internal Auditors (IIA) International Standards for the Professional Practice of Internal Auditing.

Authority

The audit was conducted under the authority of the approved Statistics Canada Integrated Risk-based Audit and Evaluation Plan 2017/2018 to 2019/2020.

Findings, recommendations and management response

Governance, oversight and risk management for HR planning

Governance processes for HR planning are in place to provide direction and oversight. Committees and subcommittees are designed to address all areas of HR management and provide support to the modernization initiative.

Roles and responsibilities for HR planning are clearly defined and documented throughout the organization.

Key risks to meeting HR modernization objectives have been defined, and mitigation strategies have been identified in order to effectively manage these risks.

Governance processes provide oversight and direction for HR planning. They define the objectives for the planning process, the policies and procedures for carrying out the work, and the monitoring of the implementation. An effective risk management process over HR planning includes the identification of risks to the achievement of HR objectives and mitigation strategies.

Governance processes are well-defined and provide oversight and direction for HR planning

The overall direction for Statistics Canada's HR planning is provided by the Senior Management Review Board (SMRB) and the Corporate Planning Committee (CPC).

Membership of the SMRB include the Chief Statistician, assistant chief statisticians and directors general (DGs). The SMRB meets on a biannual basis to set the direction for the agency and define its long-term investment strategy. The CPC meets on a monthly basis and is responsible for overall corporate reporting, resourcing, people and investment.

The CPC previously reported to the Executive Management Board, but was realigned in September 2017 after changes to the Statistics Canada's governance structure. The EMB was restructured to ensure that decision making is made at the right level and that employees are empowered to make decisions to better support the modernization initiative. It was replaced with the following three committees: the Strategic Management Committee, the CPC and the Operations Committee. The membership of the CPC includes the Chief Statistician, the Chief of Staff, all Assistant Chief Statisticians, the Chief Audit and Evaluations Officer, and the DGs responsible for service areas.

The CPC is provided with HR information through the agency's Human Resources Committee (HRC). The HRC's role is to provide the CPC with advice and strategic direction on workforce and workplace measures regarding the acquisition, training, deployment, career development and retention of employees at Statistics Canada. In addition, the HRC serves as an oversight committee of the HR Talent Acquisition (Plan, Attract and Recruit), Talent Engagement and Workplace Wellness (Welcome, Engage and Enable) and Talent Development (Grow, Develop and Support) subcommittees.

Figure 1. Overview of Statistics Canada HR governance structure.

Overview of Statistics Canada HR governance structure

Description of Figure 1

The diagram is a visual representation of the overall human resource governance structure in place at Statistics Canada. There are a total of six boxes used to demonstrate the human resource governance structure. The structure is headed by the Corporate Planning Committee (box 1 - parent), below is a reporting line pointing downward to the Human Resources Committee (box 2 – child) and then further divided below into three sub-committees (from left to right): Talent Engagement and Wellness Subcommittee (box 3), Talent Development Subcommittee (box 4) and HR Talent Acquisition Subcommittee (box 4). Also, a dotted line (on right side of box 1) identifies the Senior Management Review Board (box 6).

The membership of the HR committees includes a cross-section of DGs, directors and assistant directors representing all fields in the organization, as well as members of the Statistics Canada’s Young Professionals Network, the Chiefs network and Employment Equity groups. Members are responsible for communicating issues to the committee and decisions back to their colleagues. These subcommittees were only recently established and have only begun to develop their Terms of References and propose HR work plans for the agency.

Interviews and reviews of committee meeting minutes revealed that this network of committees is responsible for setting HR strategic directions, identifying current and future HR needs and developing corporate strategies and priorities.

Roles and responsibilities of key stakeholders involved in HR planning are clearly defined and documented in various documents published by TBS and Statistics Canada. Job descriptions from the level of Assistant Chief Statistician down to the level of Chief specifically include the responsibility for developing long-term plans and allocating HR requirements to meet those plans.

Overall, the agency has defined governance structures to provide direction and oversight for HR planning. Processes are in place and roles and responsibilities are clearly defined.

It is important to note that many of these committees are relatively new and have only been recently realigned to support modernization efforts. Therefore, limited information has been shared or made available on whether strategic direction provided by senior management committees is being effectively operationalized and carried out. There will be opportunities for these committees to develop a strong monitoring function in order to review the success of the strategies to meet the modernization objectives. Monitoring is discussed further in the next section of the report.

Key risks to HR management have been defined and mitigation measures have been identified

Key risks to HR planning are identified through the agency's Corporate Risk Profile (CRP). The CRP identifies the DG Human Resources Branch (HRB) and the Human Resources Committee (HRC) as owners of the HR risks.

A review of documents was performed for the modernization vision as it relates to modern workforce and flexible workplace, which found the following outcome defined: Statistics Canada will have the talent and environment required to fulfill current business needs, and will remain open and nimble to adapt to future demands. This outcome is linked to HR risks identified in Statistics Canada's 2017–2018 Corporate Risk Profile (CRP), that is, ''the inability to recruit employees with the required skills and expertise.''

Mitigation Strategies have been identified for these HR risks. Strategies include using the Integrated Strategic Planning Process (ISPP) to ensure HR needs are aligned with financial resources, and using specific key competencies as developed for all levels of the Mathematics (MA), Economics and Social Science Services (EC) and Computer Systems (CS) groups.

Interviews with the HRB and a review of documents tabled during the ISPP indicate that these mitigation strategies are currently being implemented. THE HRB is providing the SMRB with key activities and status updates during the ISPP. Inventories of competencies for each group have been developed. Critical skill gaps across the organization have not yet been developed.

The audit team reviewed the 2018–2019 CRP process, which is currently underway. A review of the risks identified in each field indicates that HR risks are considered in the analysis. This includes risks of limited resources to address emerging data needs and the unavailability of certain skill sets.

These risks and their mitigation strategies are tied to the higher-level corporate risk of credibility and reputation, which states that because of the scope and complexity of the significant transformations under the modernization initiative, there is a risk that the objectives of the initiative and the heightened expectations of users will not be fully met, resulting in a loss of credibility and reputation.

Overall, there is a risk management process in progress that will help to identify HR risks related to achieving program objectives.

HR planning strategies and processes

HR planning processes are in place with many of the key components needed to develop an integrated HR and business plan.

Objectives and business goals have been defined and work has begun to develop an understanding of the environment and identify skill gaps. The Human Resource Branch works with programs and committees to identify and address short and long term needs in order to develop recruitment and staffing options.

Some HR strategies have been developed to meet new and emerging agency-wide critical skill sets but have not yet been finalized in an overarching consolidated plan. This is largely because the organization is transitioning to support the new modernization agenda. There are opportunities to improve the structured and integrated approach of the planning process by creating a plan and tools for obtaining more granular information in the future that will allow for more precise identification of HR needs in the modernization context.

Lastly, as the organization develops its long-term vision for HR planning, it should develop monitoring approaches with concrete targets to measure the success of this strategy.

The most recent TBS Integrated Planning Handbook for Deputy Ministers and Senior Managers identified a five-step approach for developing an integrated planning process: determining objectives and business goals, scanning the environment, conducting a gap analysis between current and future needs, setting HR priorities to achieve business goals, and measuring, monitoring and reporting on progress.

HR planning processes are in place to address short-term staffing needs. Processes and tools to identify, integrate and monitor long-term critical skill sets have not been fully developed.

Determining objectives and business goals

The ISPP is used to identify objectives and business goals for the agency, which establish a long-term investment outlook for financial, information technology (IT) and human resources. This process ensures that the decisions and directions of the organization are integrated and aligned with corporate strategic priorities, while also taking into consideration financial, IT, and, most importantly, HR requirements and capacities.

The overall objective of Statistics Canada's HR planning process has been identified as the acquisition and retention of a competent, motivated and flexible workforce that can meet the agency's changing needsFootnote 1. Interviews and the review of documents have confirmed that this objective has been communicated and is well-defined as part of the modernization initiative.

Scanning the environment and conducting a gap analysis

The environmental scan and gap analysis is done mainly through an agency-wide analysis that is prepared by the HRB and includes workforce and labour market assessments. The results of this analysis are reported in an HR dashboard, which is provided to divisions and tabled at senior management committees.

It was noted through interviews with program managers that this data may be too high-level for their purposes. As a result, many program managers opt to conduct their own analysis. Interviews with HRB indicated that it can conduct detailed analysis on the data to a level useful for field managers, but this has not been communicated to divisions.

To develop the agency-wide gap analysis, the HRB consults with Field Planning Boards on competencies and needs. This leads to the identification of recruitment processes and of needs for collective staffing processes.

In addition, the HRB is also involved in Monthly Financial Reviews in partnership with programs and financial officers. The financial officers lead managers in reviewing and updating budgets and short-term staffing requirements, while also tracking the financial impact of anticipatory staffing activities.

The HRB indicated, that while planning discussions take place with fields on current and future vacancies, that there were limited consultations with individual divisions around critical skill sets.

Additionally, interviews confirmed that there are no guidance documents or tools for conducting short and long-term HR planning. Direction on planning is being provided by senior management through governance committees and field planning boards.

In the absence of tools or guidance, only a few divisions included in the audit sample had reviewed and formally documented their long-term business needs. One of the fields developed long-term plans including a review of their business requirements. This is a practice that could be shared across the organization for an integrated and consistent approach.

The current planning process helps to identify divisional needs to fill vacancies at each classification level and the organization has a proactive approach to have pre-qualified pools of employees to meet their needs. However, given the new skill sets required to support modernization, this may no longer be sufficient to support long-term planning.

There are opportunities for the HRB to develop an integrated and structured approach to identifying long-term staffing needs in order to successfully identify, develop, recruit and retain the critical skill sets needed to reach long-term modernization objectives.

Setting HR priorities

Long-term HR planning activities are performed by the HRB. The HRB is responsible for developing the Integrated Business and Human Resource Plan (IBHRP). The IBHRP operationalizes the direction provided in the strategic planning processes and sets the HR priorities. The plan was last prepared in 2015, and covers the period from 2016 to 2018, and outlines key priorities in internal and external staffing, workforce development and improvements to HR services at Statistics Canada over a period of three years.

The IBHRP has yet to be updated to reflect Statistics Canada's current business requirements and, more specifically, modernization initiatives. Interviews with the HRB indicated that an updated and redesigned IBHRP will be developed in fiscal 2018/2019, and incorporate the latest strategies.

Measure, monitor and report on progress

The audit team reviewed the HR monitoring processes in place at both the corporate level and the divisional level to measure whether HR strategies are reaching the desired outcome.

Monitoring HR progress against the HR Strategy is mainly done through the Staffing Monitoring Plan (SMP), which was presented to and approved by the HRC (January 2017) and senior management (May 2017).

Review of the SMP revealed that there are measurable indicators for monitoring organizational staffing trends to ensure that staffing activities conducted by the HRB remain effective.

The data collected under the SMP are classified under three categories:

  1. Effectiveness of staffing enabling Statistics Canada’s transformation: measures in this category include the ability to attract talent from outside the organization, efficient pool management, quality of hires, staff mobility and critical skill sets.
  2. Effectiveness of the new direction in staffing: measures include the appropriate use of non-advertised appointments, the overall atmosphere of the HR system (staffing component), the implementation of lowered sub-delegation levels, access to selection processes and the overall health of Statistics Canada staffing system.
  3. Quality control—Compliance with the legislative framework: measures include the application of the Veterans Hiring Act and priority entitlements, staffing file compliance, appropriate use of non-imperative staffing and appropriate use of the Public Service Official Languages Exclusion Approval Order.

Other monitoring tools within divisions include HR dashboards and the organizational charts in the ORG PLUS database. These tools provide divisions with information to manage current staffing needs.

Overall, there are tools to measure and report staffing and short-term HR planning. However, the success of HR modernization strategies, such as a modern and flexible workplace and a renewed approach to recruitment, are not yet being measured and reported against. As the organization develops the IBHRP, consideration should be given to how it will measure, monitor and report the performance of HR strategies. This includes the development of concrete targets.

Recommendations

It is recommended that the Assistant Chief Statistician, Corporate Services and Chief Financial Officer ensure that:

  • there is an updated Integrated Business and Human Resources Plan with HR priorities, as identified through the Strategic Planning Process
  • the Human Resources Branch consults and communicates with divisions on HR needs and develops tools and guidance for the creation of short and long-term plans as part of the Integrated Business and Human Resources Plan
  • there is an approach to measure and report on the progress of achieving long-term HR modernization goals.

Management response

The organization has a solid and long-standing foundation of human resources planning. This approach has served the organization very well through the years and provides insights and tools to proactively manage the cyclical nature and complexity of its programs over time. The modernization journey in which the organization is embarking on and the new types of competencies and skill sets to meet these priorities have been at the center of our continuous improvement to be responsive to these needs in an even more integrated and strategic way. To this effect, a number of new strategies have been developed and are being implemented. The final step is now to consolidate these strategies into an overarching and Integrated Business and Human Resource plan for 2018-2019 and beyond.

Management agrees with the recommendations and will take the following actions:

In 2017/18, the HR Branch integrated planning into its priorities and activities in order to build a strong foundation to support departmental modernization needs and efforts. Over the past year, HRB:

  • Stabilized Director positions (EX-01/EX-02 process to staff 4 vacant positions)
  • Re-organized workload and capacity to address gaps and additional pressure points such as Phoenix
  • Established HRC sub-committees (TAC, TDC, TEWMC) to set the strategic direction, the identification of current and future needs, the confirmation of requirements, and the development of corporate strategies and priorities
  • Used an HR business analytics lens to establish a baseline of HR information in the areas of talent management needs, competency and skill requirements, potential partnerships with academic institutions, recruitment strategies etc.
  • Building an internal HR business partner model that matches a client (i.e. ACS) with one senior HR advisor who acts as the main contact for a wide-range of HR services and advice.

In 2018-19, HRB will build on the success achieved in 2017-18 by developing an updated Integrated Business and Human Resources Plan (IBHRP) that elaborates on:

  • Key HR priorities to support modernization
  • Evidence based and metric driven HR strategies
  • HR Governance
  • Measuring and reporting on results.

Within the IBHRP, HRB will develop a framework to ensure ongoing communication and consultation with divisions on HR needs to support HR planning and develop tools and guidance for divisions to support HR planning. 

As an annex to the IBHRP, HRB will develop a measurement framework to measure and report on the progress in achieving long-term HR modernization goals.

Deliverables and Timelines:

    The DG, HR will:

  • Draft the IBHRP and present it to HRC for feedback. The IBHRP will be submitted to SMC for final approval and published on ICN and communicated to all staff by June 30, 2018.
  • Draft the communication and consultation framework within the IBHRP by June 30, 2018.
  • Draft the measurement framework with reporting timelines as an annex of the IBHRP by June 30, 2018.
  • Implement the IBHRP framework and communicate to divisions about existing tools and develop new tools as required by March 31, 2019.

Appendices

Appendix A: Audit Criteria

Appendix A: Audit Criteria
Table summary
The table in Appendix A
Control objectives / Core controls / Criteria Sub-criteria Policy instruments / Sources
Objective: Ensure there is a human resource planning framework in place that aligns with the organization’s current and future business needs.
1.1 Governance structures, mechanisms and resources are in place at Statistics Canada to manage HR planning activities. 1.1.1 Governance and oversight bodies are established at the appropriate levels of the organization to ensure HR planning activities are aligned with corporate priorities. HR plans are based on a clear understanding of the organization’s HR risks and senior management risk tolerance.
1.1.2 Current policies, procedures and guidance provide clear direction to all stakeholders involved in the HR planning process.
1.1.3 Roles and responsibilities of key stakeholders in the HR planning process are clearly defined, documented, communicated and understood.
Relevant Treasury Board of Canada Secretariat (TBS) legislative and regulatory requirements and Statistics Canada policies and procedures, such as
  • Values and Ethics Code for the Public Service (TBS)
  • Policy Framework for People Management (TBS)
  • Integrated Planning Handbook for Deputy Ministers and Senior Managers (TBS, 2008)
  • Strategic Human Resource Planning (HR Council)
  • Management Accountability Framework (TBS)
1.2 HR planning is aligned with strategic and business planning. 1.2.1 Current and future resource requirements at the division and branch levels are identified in the HR planning process and a gap analysis against existing competencies and capacities is performed.
1.2.2 HR planning strategies are developed based on the results of the gap analysis and a corporate document is produced.
1.3 Management monitors and assesses the effectiveness of the HR planning on a regular, scheduled basis. 1.3.1 The HR planning strategy is actively monitored to produce regular and timely reports to support effective HR planning and is communicated to senior management and other key decision makers.

Appendix B: Initialisms

CPC
Corporate Planning Committee
CS
Computer Systems
CRP
Corporate Risk Profile
CSP
Corporate Staffing Plan
HR
Human Resources
EC
Economics and Social Science Services
EMB
Executive Management Board
FPB
Field Planning Board
HRB
Human Resources Branch
HRC
Human Resources Committee
IBHRP
Integrated Business and Human Resource Plan
ISPP
Integrated Strategic Planning Process
IT
Information Technology
MA
Mathematics
MFR
Monthly Financial Reviews
TBS
Treasury Board of Canada Secretariat
SMP
Staffing Monitoring Plan
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