Connect with HR – Organizational Reviews – What They Are and Why You Might Need One

Posted on January 18, 2012 by admin | Posted in Highlights

Organizational Reviews – What They Are and Why You Might Need One

An Interview with Jacq Hammond

What is an Organizational Review?

JH I would liken it to an “annual medical/physical”. An organizational review is a complete “check-up” that examines people, processes, policies and operational efficiencies. By reviewing each of these, the company gains a clear understanding of how  they  can  improve  their  overall  “health”  whether  it  be  financial  health  (cost savings), people health (motivated, effective employees), and/or operational health (processes).

What prompts an Organizational Review? i.e., how does a company know if they need one?

JH Often the prompt for an Organizational Review begins with an employee issue. I often see the need when a long-term employee leaves and the company isn’t quite sure if they need to replace the person with a more senior person or if they should delegate some of the responsibilities to other employees. There are other times when a company has either gone through a major downsizing or a major growth period and things just don’t seem to be working as efficiently as before. Companies that have been recently purchased, or have undergone a merger, are often in need of an overall study in order to develop a strategic plan for operational efficiencies and/or HR processes.

What is the process?

JH We start by interviewing a cross-section of employees to gain an understanding of what they do, how they do it, why they do it, and what impact their job has on other areas of the business. We discuss their career path, their future goals, their view of their immediate manager, general management and what they feel could/would make the business better, both from an efficiency point of view and a human resources point of view.

Then we review the organization’s processes by spending time in each department or on the plant floor.

We also review the organization’s current policies to understand if the business is compliant with the Employment Standards Act (ESA) and the Joint Health & Safety Act; if it could be exposed to fines, human rights complaints, ESA complaints, etc.

With all of that information at our fingertips, we conduct a comprehensive analysis and provide the business with a report outlining positives, detractors, and issues; and realistic recommendations to address the detractors.

What are some of the outcomes a business could expect from conducting an organizational review?

JH It allows owners to “step outside” their business and have a clear view of what’s working and what’s not. It helps them answer questions like:

  • Do we have the right number of employees?
  • Are our employees engaged in their work?
  • Do we have the right people in the right jobs?
  • Do our processes meet the demands of our business?
  • Do our policies meet various legal requirements?
  • Can we improve our bottom line by changing policies, processes or people?

How often should we conduct one?

JH We highly recommended conducting an organizational review annually for the first two/three years. In cases of a recent merger or a change in ownership/ -senior leadership, a review should be conducted immediately and then depending on the willingness/ability to implement the recommendations arising from the first review, a six month follow up is desirable.

What do you see most often as the key detractor and its resolution?

JH Most often, I see that length of service leads to employees doing things the way they’re doing them because they’ve always done it that way. This leads to complacency. That, coupled with the lack of a performance monitoring system, results in employees becoming disengaged and de-motivated, leaving employers practically powerless to do anything about it.

The most common resolution for these scenarios is to change the processes, re-engage the employee(s) or move the employee(s) to a different job to re-engage, and/or redirect the employee(s) to capitalize on their strengths.

What can an employer expect to pay for this type of evaluation?

JH It depends on the number of employees and departments to review, but the range is usually between $5,000 and $15,000.