organizational excellence implementation plan summary

COMMITTEE OF THE WHOLE MEETING

FEBRUARY 1, 2016

REPORT #DCAO-2016-01

ORGANIZATIONAL EXCELLENCE IMPLEMENTATION PLAN SUMMARY

RECOMMENDATION

That report DCAO-2016-01 be received.

That the organizational structural changes recommended by KPMG as outlined in Attachment No. 1 to report DCAO-2016-01, which represents an increase of three in the approved full-time compliment in 2016, be approved.

That the action items and associated timelines identified throughout report DCAO-2016-01 be approved.

OBJECTIVE

The purpose of this report is to propose an implementation plan that begins the Town‟s journey toward Organizational Excellence that utilizes both the findings and recommendations of the Service Delivery Review that was recently completed by KPMG and other observations made by staff. The Town‟s progress toward Organizational Excellence will be reported to Council on an annual basis. It is important to understand that this implementation plan will be a living document that will evolve over time based on new opportunities as they arise.

BACKGROUND

The Town, like other levels of government and organizations, must ensure that it is meeting the needs of its constituents and customers in the most efficient and effective manner possible while recognizing financial constraints. Since its inception, the Town has been successful in delivering a multitude of services to the community while considering affordability levels. Moving forward, it will be essential to ensure that the Town is well positioned to adapt to and address future challenges and opportunities.

In March 2015 Council adopted the Foundation for Organizational Excellence as a framework for continuous improvement at the Town of New Tecumseth. The Foundation for Organizational Excellence is designed to provide a framework to guide the Town‟s collective efforts and focus them on a common goal of continuous improvement across all aspects of the Town.

Organizational excellence can be defined in a variety of ways, however it essentially speaks to optimizing the use and effectiveness of all resources across an organization. It requires a balanced approach and deliberate steps focused on strengthening each aspect of the organization in order to continuously improve internal alignment and

Report #DCAO-2016-01, February 1, 2016

service delivery. The seven elements of the framework adopted by Council are Leadership, Corporate Planning, Financial Management, Process Development, Employee Engagement, Citizen/Client Focus and Community Partner Relationships.

When an organization embarks on a journey to excellence a critical first step is to undertake an assessment of how the organization is currently performing. In March 2015 Council took this critical first step and directed that a Service Delivery Review be undertaken. In July 2015, KPMG was retained for this purpose. The Service Delivery Review served as a baseline for organizational performance that will be used to measure our progress but it also includes findings and recommendations that will be used to advance every element of the organizational excellence framework.

The primary objective of the Service Delivery Review was to have an external consultant review the Town‟s service delivery, operational processes and structure. It is the intent that recommendations and opportunities developed as a result of this review be designed to provide assistance to Council and management in improving levels of efficiency and effectiveness as well as internal alignment of the organization, to ensure the Town is providing value to the community today while also positioning it favourably to address future challenges and opportunities.

The Terms of Reference for the Service Delivery Review adopted by Council stated that the primary objective of the Review was to have an external consultant review the Town‟s service delivery, operational processes and structure. The consultant was to provide recommendations and identify opportunities that would assist both Council and management in improving the efficiency and effectiveness of service delivery and the internal alignment of the organization. The recommendations were also required to ensure that the Town was positioned to provide both value to the community today and to address future challenges and opportunities.

KPMG used the following principals when conducting the service delivery review:

The knowledge and expertise of Town employees and Members of Council will be fully engaged, building upon their knowledge and expertise to arrive at recommended actions through a transparent, participative and inclusive process facilitated by the Consultant.

The aim is to, wherever possible, transfer knowledge and necessary “tools” to Town staff to enable them to better develop their own solution to operational and process issues and challenges over time.

The organizational structure and work processes should consider leading practices, foster the efficient and effective delivery of service and demonstrate best value.

Recommended strategies and implementation plans will be fiscally responsible and mindful of the resource and staffing capacity limitations of the Town

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The Service Delivery Review project was divided into the following phases:

Phase 1: Project Planning

Phase 2: Overview of Municipal Environment

Phase 3: Review of Current Service Delivery Model

Phase 4: Review of Organizational Structure

Phase 5: Benchmarking

Phase 6 & 7: Final Report and Presentation

In November 2015, KPMG presented their final report that outlined their findings and recommendations. Overall, KPMG‟s final report indicated that the Town was functioning very well, however they also made a number of recommendations to build on what has been done to date. KPMG‟s Opportunities for Improved Operational Efficiencies and Effectiveness section of their final report has been attached to this report as Attachment No. 2. In keeping with the first recommendation (No.1), each of the subsequent recommendations and opportunities for improvement identified by KPMG can be aligned with the elements that form the Framework for Organizational Excellence. This will facilitate the Town‟s advancement in its journey toward Organizational Excellence and will also allow for consistent messaging, direction and understanding for staff across the organization. All aspects of the Service Delivery Review work will be fully integrated with the journey toward Organizational Excellence and used as foundational work that will be built on over the next five to six years.

In addition to KPMG‟s recommendations, a number of other action items have been included in the implementation plan as identified over the past year by staff. These action items typically relate to aspects of the Organizational Excellent Framework that were not within the scope of the Service Delivery Review.

COMMENTS AND CONSIDERATIONS

Leadership

Build a culture that fosters and encourages leadership at all levels that is aligned with corporate values and the Town’s Business Strategy.

In their final report, KPMG references the need for the Town to develop both Performance Measurement and Performance Management frameworks. For clarification, Performance Measurement speaks to how well the organization is performing month over month and year over year and will be discussed in greater detail under the Corporate Planning element. Performance Management speaks to how well individual employees are performing with respect to expectations. Expectations for employee performance are best defined by Corporate Values and Core Competencies.

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Development of Corporate Values:

Cornerstones of an organization are their Mission, Vision, Values and Strategy. The Town has these in place with the exception of Corporate Values. Corporate Values are guiding principles that should be used in the hiring process as well as to dictate expected employee behaviour and actions. As previously outlined, Values are an essential element in building an effective employee performance framework as well as an engaged workforce. It is recommended that the organization undertake the development of Corporate Values through an inclusive process that engages staff from across the organization in a series of workshops starting in the third quarter of 2016.

Development of Employee Core Competencies:

Where Corporate Values dictate the behaviours and actions of employees, Employee Core competencies and expected skill levels associated with each position clearly define how each employee should be performing. Establishing Employee Core Competencies for the organization and expected levels for each position will also support employee career development plans by providing a roadmap for professional growth and development. It will also provide a foundation for addressing the need for an enhanced focus on succession planning as identified in KPMG‟s findings and evident by the number of employees eligible for retirement in the coming years. The Employee Core Competencies will be built by the Management Team through facilitated workshops in the second quarter of 2016.

The Leadership Challenge Model:

Organizations that are recognized as performing at an excellent level have a number of qualities in common. The first and foremost is outstanding leadership. This not only speaks to the traditional “top down approach” but also to the concept of “leadership at all levels.” This speaks to the culture of an organization being lead by more than just one or two key positions. For this to happen, organizations need to evolve to a culture that encourages empowerment and inclusiveness. A first step in this direction should be investing in the development of staff at all levels of the organization.

A very widely recognized model for building leadership skills is The Leadership Challenge. The Leadership Challenge was originally developed over thirty years ago by James M. Kouzes and Barry Z. Pozner and was based on thousands of case studies that analyzed times when leaders performed at their very best. Out of that emerged five practices common to extraordinary leadership achievements, which include:

Model the Way

Inspire a Shared Vision

Challenge the Process

Enable Others to Act

Encourage the Heart

Kouzes and Posner have continued their work over the past thirty years and their original findings have been continuously validated. As a first step, the implementation

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of this model to Supervisor positions and above would start them building the necessary skills to develop into effective leaders.

Development of Employee Performance Management Framework:

With the development of Corporate Values and establishing Employee Core Competencies, the Town will be well positioned to establish a more formal employee performance management framework as recommended by KPMG (No. 4.) By formalizing the employee performance management framework, the opportunity for providing feedback to staff on how their performance compares to expectations of the position is created. It provides the opportunity to recognize an individual‟s strengths and opportunities for improvement. Performance plans can then be used to address those opportunities with the objective of helping the individual improve their performance level. An opportunity is also created to discuss the individual‟s career goals. This can lead to the development of training opportunities both formal and informal that allow for the development of skills as identified in the Employee Core Competencies so that they are prepared when promotion opportunities arise.

Enhancing Internal Communications:

Effective communications are an essential part of any organization‟s success. Enhancing the Town‟s communications efforts will enable the Town to achieve its goals and evolve to a higher level of performance. Given the importance of communications, it will also be discussed in several of the other elements in the Framework for Organizational Excellence.

A fundamental attribute of leadership is not only ensuring that expectations are clear from both a behaviour and performance perspective but are also consistently communicated throughout the organization. Enhanced internal communications, as recommended by KPMG, (No. 11) can be accomplished through several means.

The Communications Strategy recently adopted by Council identified the need to increase the use of the Town‟s Intranet to provide an effective method for communicating consistent messaging to employees with direct access to computers. This is in the early stages of implementation.

A more formal meeting structure can also be effective for communicating both strategic and operational items. It is recommended that if not already occurring, regular meetings be held at the Division, Department, Branch and Business Unit levels.

Appointment of CAO as Deputy Clerk:

As per KPMG‟s recommendations, (No.2) there are occasions when the CAO needs to speak with Council in closed session without other Town staff present. In order to comply with the requirements of the Municipal Act to have a Clerk present for all meetings, the CAO can be appointed Deputy Clerk by by-law. A by-law will be presented to Council for adoption at the meeting scheduled for February 8, 2016.

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Leadership Action Items Implementation Timeline

Action Item Timeline

CAO appointed as Deputy Clerk 2016 Q1

Development of Corporate Values 2016 Q3 - Q4

Development of Employee Core Competencies 2016 Q1 - Q2

Introduce the Leadership Challenge 2016 Q3

Development of Employee Performance Management Framework

2017 Q1

Enhancing Internal Communications - Underway

Corporate Planning

Build and implement a corporate planning process driven by a culture of continuous improvement. It will focus on building trust and confidence with Council and the community we serve through clearly demonstrating alignment and utilization of resources that will be used to deliver services and projects to the community.

Introduction of Continuous Management Cycle:

A key finding by KPMG was that, “the Town is currently unable to measure its performance and therefore has no clear and consistent way of demonstrating value for money to the public or to internal stakeholders.” They recommended (No. 4) the implementation of a performance measurement framework to measure year over year performance from a quality perspective. KPMG also recommended (No. 21) the development of annual “business plans for each department that describe the specific work to be undertaken and the utilization of current staffing resources that aligns with the annual budget process.”

The introduction of a continuous management cycle as presented to Council as part of the Framework for Organizational Excellence will address these recommendations. A continuous management cycle consists of the following elements:

Strategic Planning: This element speaks to the long term vision of Council for the community and what actions are required of the organization for that vision to be realized. The previous term of Council developed a Strategic Plan that extends to 2018. Through recent reports from the CAO, and in keeping with KPMG‟s recommendations, (No. 3) this term of Council has confirmed that plan represents the strategic direction of this term.

Annual Planning: There are two primary inputs to the annual planning cycle. The Strategic Plan and associated action items and a review of Service Delivery Profiles which are more operational in nature. The first Service Delivery Profiles were developed under the guidance of KPMG as part of the Service Delivery Review project. Recognizing that service levels drive costs, Service Delivery Profiles outline each

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service provided by the Town, the level at which each is provided and the current level of resources; both financial and compliment.

An annual update and review of the Service Delivery Profiles can facilitate a more comprehensive discussion between Council and staff. It also provides Council an opportunity to adjust services and service levels to reflect the community‟s needs and levels of affordability. The organization will continue to refine the Service Delivery Profiles and will be discussing them in greater detail with Council as part of the 2017 business planning process. Annual work plans speak to not only annual processes and projects to be undertaken to support the provision of services but also the resources required to complete each. Each Departmental work plan will be a direct input to their operational and capital budgeting process.

Performance Measuring & Monitoring: A common business philosophy is that, “you can only manage what you can measure.” This element will provide the organization with an approach to measure effectiveness and assess progress towards planned results by first establishing meaningful performance metrics that reflect service level objectives as well as planned performance levels for each metric. Understanding variances between planned and actual results and identifying any required corrective actions will establish the Town‟s commitment to continuous improvement.

Performance Reporting: This element focuses on reporting results against plans as well as demonstrating the use of and learning from the reported results. This demonstrates a commitment to openness and transparency with the intent of building trust and confidence with Council and the community.

Corporate Planning Action Item Implementation Timeline:


Strategic Plan Confirmation Completed

Introduction of Continuous Management Cycle - Annual Work Planning

2017 Q2 - Q4

Introduction of Continuous Management Cycle - Performance Measurement Framework

2017 Q1

Introduction of Continuous Management Cycle - Performance Reporting Framework

2017 Q2

Financial Management

Build a framework that places the Town on a sound and sustainable footing so that financial resources, service levels and asset standards can be met without resorting to unplanned or excessive increases in taxes and user rates or undesirable reductions in services.

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Creation of Financial Policy Framework:

Municipalities leading in the field of financial planning and management have taken an approach of creating a Financial Policies Framework with the broad intention of establishing a framework for effective financial planning and management to ensure long term financial sustainability. The Financial Policy Framework is a valuable tool that will guide financial decision making in a manner that is consistent and that supports the Town‟s long term financial objectives.

The set of financial policies along with a long range financial plan will provide a mechanism for identifying instances where actual performance differs from established targets in order to allow for adjustments to be made in a prompt and effective manner and prevents the potential for poor incremental decisions to erode the overall financial objectives of the Town over time. In general, the financial policy framework will also support strategic and operational scenario planning exercises, provide guidance during the annual business planning process, support specific Council deliberations regarding the use of funds throughout the year and perhaps most importantly will serve as an accountability and communication tool for Council and residents.

Enhanced Emphasis on Asset Management and Long Range Financial Planning:

Every service that is provided by municipalities relies on municipally owned assets to perform appropriately. More and more, municipalities are challenged by pressures associated with aging infrastructure and funding the rehabilitation and replacement work required to ensure the uninterrupted provision of services. In recent years, many leading municipalities have adopted a more proactive approach to asset management and long range financial planning. Recognizing the need for a more focused approach to both managing the Town‟s assets and planning for long term financial requirements of the Town, KPMG recommended (Nos. 13 and 14) altering the organizational structure to create branches with dedicated resources towards corporate asset management and financial planning. These changes will allow for a greater focus and sustained efforts in these areas which will better position the Town to address challenges of today and tomorrow while ensuring that tax levels are set at a level that strike an acceptable balance between planning for tomorrow and affordability.

The Asset Management Branch will require a Manager position which will be recruited later in 2016 as well as additional staff compliment which will be added through the budget process in each of the following two years. The Financial Planning Branch will be staffed with existing compliment which includes a Financial Analyst position that is within the approved compliment but is not currently budgeted. This position will be filled in 2016.

User Fee Analysis:

Through the benchmarking analysis undertaken, KPMG found that there is an opportunity to analyze the Town‟s cost recovery through user fees as it was recovering the least through user fees in comparison to its municipal peers. As a result, KPMG recommended (No. 19) that the Town undertake a further review of user fees to ensure that it is accurately recovering the true cost of service delivery. Staff have already

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commenced this analysis and the results will be presented to Council in a separate report.

Consolidation of Library‟s General Ledger into the Town‟s Financial System

KPMG also noted that the Library is continuing to operate its own General Ledger. In their recommendations (No. 18) KPMG outlined that given the size of the New Tecumseth Library, there is an opportunity to consolidate its G/L into the Town‟s accounts and integrate into the Town‟s financial system. The current Joint Services Agreement expires on March 31, 2016. There will be an updated Joint Services Agreement presented to Council in March.

Financial Management Action Item Implementation Timeline:


User Fee Analysis 2016 Q1 - Q2

Discussions with the Library regarding consolidation into Town`s Financial System

2016 Q1 - Q2

Creation of Financial Policies Framework 2017

Development of Long Range Financial Plan Underway

Process Development

Build an understanding of Core and Key Processes and leverage a culture of continuous improvement that demonstrates a commitment to efficient and effective service delivery and being responsive to changing needs of the community and organization.

Use of Process Mapping to Identify Improvement Opportunities:

As part of the Service Delivery Review project, KPMG spent a day with staff from the Finance, Engineering and Planning Departments where they conducted two process mapping exercises. The reasoning for taking this approach is two-fold. Firstly, it was intended to provide greater understanding of two key processes in the organization. Secondly, and equally as important, it provided an opportunity to a group of staff to learn the process mapping approach to continuous improvement.

Process mapping helps represent work processes visually and identify problem areas and opportunities for process improvement. It enables organizations to clearly define the current processes in chart form, identifying problem areas such as bottlenecks, capacity issues, delays or waste. Once identified, this knowledge and understanding of that process provides a solid basis from which to develop solutions and introduce and plan new improved processes.

Process mapping also creates the opportunity for staff directly involved in the process to participate. This inclusive approach ensures that the information used is accurate and is very effective in developing buy-in for the any changes identified. This will allow for a

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smoother change management process and will reduce the risk of staff resisting the changes.

Finally, the use of process mapping techniques creates the opportunity to assess the anticipated impact of the change which can be important when the recommended changes are significant. This information can be used to support a recommendation for making the change but it can also be used to determine whether the process change was as successful as anticipated and if not corrective action can be identified.

Identify Improvement Opportunities for Budget and Development Application Processes:

Finance, Engineering and Planning staff identified all the steps and decisions in the budget and development application processes in diagrammatic form, with a view to continually improving those processes. In keeping with KPMG‟s recommendation, (No. 20) efforts will continue on these processes as well as others across the organization to ensure that the processes being followed are providing the most efficient and effective delivery of services possible.

Enhanced Emphasis on the Use of Technology:

Through a review of the Town‟s current state, KPMG realized that an opportunity existed to leverage technology to a greater degree and recommended (No. 8) to invest in renewed IT infrastructure. The 2016 Capital Budget as approved by Council includes a project to undertake the development of an IT Master Plan which will identify opportunities to leverage technology to optimize service delivery.

In addition, process mapping as previously outlined will also be used to gain insight into where technology could be leveraged to replace manual efforts with the intent of generating efficiencies with a direct impact on service to the customer.

In order to fully realize the potential benefits of an enhanced use of technology, KPMG has recommended the introduction of a Supervisor role in the Information Systems Business Unit.

Service Delivery Adjustments

As part of their mandate within the Service Delivery Review, KPMG analysed a few services where there appeared to be an immediate opportunity for improvement.

These included the following:

Review of Restaurant Business Model: From their review, it appears that the Town‟s restaurant operation is being subsidized by the tax levy. Given their findings, KPMG recommended (No. 15) that the Town undertake a detailed review of the operations and consider implementing a different business model.

Capital Project Delivery Adjustments: From their review of internal services, KPMG recognized that capital project implementation and delivery varied by departments and resulted in varying degrees

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of success. The Engineering Department currently delivers the majority of the plan and has demonstrated a consistent high level of success in delivering projects on time and within budget. Based on these findings and the approach of building „centres of excellence‟ with a clear focus, KPMG has recommended (Nos. 16 and 17) that all capital project management and delivery be consolidated under management of the Engineering Department. Prior to finalizing this shift of responsibilities a few steps will need to be taken. Ensuring that there is alignment between the magnitude of the capital plan and the resources and skill sets of those resources will be critical to the success of this change. In addition, staff working sessions will be conducted to ensure a consistent understanding of what projects may remain the responsibility of the various operational areas. Planning of this change will occur throughout 2016 with the shifting of responsibilities to occur in 2017.

Establishment of Service Level Standards: KPMG also observed that a number of other internal processes are manual often inconsistent across departments. Recognizing that there is an opportunity to improve Department-specific processes, KPMG is recommending (No. 9) to introduce service level standards for each of the Town‟s core services to standardize expectations and drive performance. Prior to undertaking this initiative there will need to be a comprehensive understanding of those services and the processes followed in the delivery of each service. Process mapping sessions in addition to continuing to build the Service Delivery Profiles previously identified in the Corporate Planning section will be essential first steps in addressing this recommendation.

Process Development Action Item Implementation Plan:


Use of Process Mapping to identify Improvement Opportunities Underway

IT Master Plan Development 2016 Q3 - Q4

Review of Restaurant Business Model 2016 Q2 - Q3

Capital Project Delivery Adjustments 2017

Establishment of Services Level Standards 2018

Employee Engagement

Build an environment where every employee can be successful and a part of something more significant than their individual role. It will focus on attracting and retaining the very best people, promoting open honest communications, and employee recognition.

Assessment of Staff Survey Results:

Another criterion that is common throughout the most successful organizations is a high level of engagement found amongst employees. KPMG found that approximately 59% of the Town‟s employees currently feel somewhat or strongly engaged by their

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department and / or the organization. This is a fairly strong result, however the survey also revealed that this is not consistent throughout the organization and could be an opportunity for improvement. The first step in beginning to address this is to fully utilize the staff survey that KPMG undertook as part of the Service Delivery Review. A workshop session with the Senior Management Team will be organized with two primary goals; to review the results of the survey to ensure that there is a common understanding amongst management and to prepare an action plan to address the priority items. Enhanced internal communications, as recommended by KPMG, (No. 11) will be essential to ensuring consistent messaging is delivered to employees.

Development of Employee Engagement Plan:

The development of a formal Employee Engagement Plan within one to two years should also be considered. This plan would outline internal communications protocols as well as mechanisms for obtaining employee feedback. Following the initial implementation of that plan, a follow-up employee engagement survey should be conducted to provide results for comparison to those produced through the KPMG survey and to begin to monitor the Town‟s progress.

Process mapping was previously discussed within the Process Development element. In addition to the benefits previously highlighted this technique can also lead to increased and improved levels of employee engagement through providing opportunities for involvement.

Review of Administrative Policies:

KPMG identified that on boarding and training practices are currently ad hoc and inconsistently applied. KPMG recommended (No. 10) that these activities be centralized and coordinated by the Human Resources Department to create the opportunity for consistent application. Centralizing all on boarding of new employees within the Human Resources Department will ensure that all new employees are provided with consistent messaging regarding Corporate Values and administrative policies. Centralized training and development will ensure equal opportunity and consistency for all employees. The current policies will be reviewed and revised appropriately in 2016.

Review of Current Total Compensation Package:

As a result of the recommended organizational structural changes, it was also recommended by KPMG (No. 12) that a review of the total compensation package for Town employees be undertaken to ensure consistency and fairness in its application. As noted by KPMG, this will not result in organization wide salary increases but may result in adjustments to some positions. It is being recommended that this review be undertaken following the implementation of all the proposed changes to the current organizational structure.

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Employee Engagement Action Item Implementation Timeline:


Review and Assessment of Staff Survey Results 2016 Q1

Development of Employee Engagement Plan 2018

Review of Administrative Policies 2016 Q2

Review of Current Total Compensation Package 2017

Citizen / Client Focus

Build exceptional customer service into everything we do by understanding the needs of the community, treating each customer with dignity and respect and focusing on timely delivery, cost effectiveness and quality assurance.

Understanding and responding appropriately to customer‟s needs and requirements is an essential characteristic common to all successful organizations. They can all consistently demonstrate not only a commitment to being efficiently aligned internally but also to having a clear external focus.

Strengthen External Communications/Enhanced Use of Social Media:

Through the Service Delivery Review, KPMG found that the Town appears to be falling behind comparable municipalities in how often and via what method it communicates with its people and the citizens it serves. To follow KPMG‟s recommendations (No. 7) the Town will become more proactive and its communications and strengthen its online social media presence to better reach residents. As previously reported to Council, the Town has already started to address this by developing a communications strategy as well as a Social Media Policy. These are currently in the early stages of implementation but once fully implemented will provide an improved mechanism for more proactive community outreach. In addition, the Communications Coordinator position is now a full time position designated with the responsibility for communications and social media.

Citizen Satisfactory Survey:

Longer term initiatives that should be considered within the next two to three years include a Citizen Satisfaction Survey and the development of a Customer Service Strategy. Reaching out to the residents of the Town through a formal survey will lead to a more comprehensive understanding of what‟s important to residents regarding service levels and communications and how well the Town is meeting their requirements. The most recent Citizen Satisfaction Survey was undertaken in 2014. A five year increment is appropriate and therefore, it is being recommended that the next survey be undertaken in 2019. The development of a Customer Service Strategy would build on the results of the survey and would be used to define the interactions between the Town and the residents its serve.

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Citizen / Client Focus Action Item Implementation Plan:


Strengthen External Communications Underway

Enhanced Use of Social Media Underway

Citizen Satisfaction Survey 2019

Community Partner Relationships

Build sound relationships with our service delivery partners through open communications and based on creativity, agility, integrity and resiliency with a focus on mutual success.

The Town does not build and serve the community on its own. It takes several entities working together for a community to truly flourish. The focus of this element is to build sound and respectful relationships with all the various partners that work with the Town in building and providing services to the community. The foundation for this will be a philosophy of working towards mutual benefits without having to sacrifice the priorities of the Town.

Numerous items that have been discussed previously will also play a key role in advancing this element. Undertaking comprehensive reviews of key processes using a process mapping approach will ensure that partners that are working with the Town are being handled efficiently. Enhancing the Town‟s communications will also be essential in ensuring that external partners have a clear understanding of the Town‟s direction, priorities and processes.

There are no specific items for implementation at this time.

Administrative Items

Structural Changes:

Following a comprehensive review of the organization‟s structure, KPMG recommended a number of changes (Nos. 5, 6, 13, and 14) to align the organization more appropriately to address current and future challenges. The broadest of these recommendations is to implement a standardized management hierarchy. In some areas (e.g Public Works) this simply will result in the updating of titles to reflect the new hierarchy. In other areas this approach will result in the introduction of supervisory and management positions (e.g Engineering and Planning).In addition to ensuring a consistent structure across the organization, the primary benefit of the new hierarchy will be to provide Directors with more support and enable them to focus more on departmental and corporate performance, rather than operational requirements.

To improve alignment of corporate supporting functions, (Finance, Human Resources, Administration and Council Services and Information Technology) KPMG recommended

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the creation of a Corporate Services Division and a General Manager position to oversee the division. This step will be the catalyst for other structural changes within the organization.

Other structural changes were outlined by KPMG in the Detailed Organizational Design section of their Final Report dated November 23, 2015. For ease of reference, this section has been appended to this report as Attachment No. 1. Anticipated timelines for the recruitment of these positions are detailed in the table below.

Structural Change Timeline

General Manager - Corporate Services 2016 Q3

Administrative Assistant to General Manager - Corporate Services

2017 Q1

Finance Department Implementation of New Organization Design 2017 Q1

Manager - Corporate Asset Planning & Management 2016 Q3

GIS Business Unit to Asset Management Branch 2016 Q3 - Q4

Supervisor of Infrastructure Asset Management 2018

Supervisor of Facilities Asset Management 2018

Infrastructure Asset Management Technician 2018

Facilities Asset Management Technician 2018

Senior Financial Analyst 2016 Q3

Information Systems Supervisor 2016 Q3

Information Systems Business Unit to Clerks Department 2016 Q1

Parks Recreation & Culture to Infrastructure & DevelopmentDivision

2017 Q1

Engineering Department Position Title Changes 2016 Q3

Public Works Department Position Title Changes 2016 Q1

Planning Department Position Title Changes 2016 Q3

Building Services to Planning Department 2016 Q1

Parks Recreation & Culture Managers Recruitment 2016 Q2

Parks Recreation & Culture Supervisors Recruitment 2016 Q3

There are two deviations from the organizational structural changes recommended by KPMG. KPMG recommended the addition of Supervisory positions in the new Building and Property Branch of Parks Recreation & Culture to occur in 2017 however given current operational challenges, it is being recommended that these positions be filled in 2016. The title of the Deputy Chief Administrative Officer will not change at this time due to the need to always have a clearly designated and identifiable point of contact in the absence of the Chief Administrative Officer.

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The new positions being added to the compliment for 2016 include:

General Manager - Corporate Services

Manager of Corporate Asset Management

Information Systems Supervisor

Parks Recreation and Culture Supervisor

In conjunction with the additions in compliment being recommended, the position of Director of Economic Development is being recommended for removal. This will equate to an increase of three positions to the Town's total staff compliment.

Space Accommodation

The Town currently has two primary spaces that contain the administrative functions of the organization; the Town Hall in Alliston and the Joint Operations Centre in Beeton. As the organization has grown and evolved to meet the needs of the growing community, space has become challenged, specifically at the Town Hall. The Planning, Engineering and Finance Departments have out grown their respective spaces. With the additional compliment being recommended for 2016, modifications to the Town Hall will be required. To address these issues and to plan for the next five to ten years of space accommodation Staff are currently reviewing various options.

Initially, there are some minor renovations to the first floor of the Town Hall being planned for 2016. Projects that are included in the 2016 capital plan as previously approved by Council include converting the vault space to office space and renovations to the washrooms.

To maximize additional space in the Town Hall Staff have spoken with the OPP regarding their use of the space on the southwest corner of the building. Initial discussions indicate that this space is no longer an essential requirement for the OPP and could become available for use by the Town.

To address the current space constraints and overcrowding in various departments, the relocation of some departments that are currently located in Town Hall to a new space will be required, Therefore, Staff are looking into various options including leasing space external to the Town Hall.

Staff will be reporting back to Council with the results of its analysis of various options as well as a plan to provide sufficient space accommodations for the Town.

Next Steps

To facilitate the most effective implementation possible, detailed implementation schedules will be developed for action items in 2016 and then annually for each

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subsequent year. A comprehensive communications plan will also be developed to ensure all staff have a clear understanding of the Framework for Organizational Excellence as well as the various action items within each element of the framework required to advance the organization.

Highlights for the coming year as well as progress towards organizational excellence will be reported to Council on an annual basis. Any necessary revisions to the implementation plan that are required throughout the year will be highlighted to Council in the annual report.

FINANCIAL CONSIDERATIONS

The 2016 Town Budget as approved by Council included $150,000 to implement the first phase of initiatives outlined in this report. Included in this amount was $100,000 to address approximately six months of salaries for the new compliment being recommended as well as $50,000 to undertake other initiatives to advance organizational excellence at the Town in 2016. Upon further review and as previously outlined in the recommended structural changes, it is being recommended that a Parks Recreation and Culture Supervisor be added to the compliment in 2016 to address operational challenges. As a result of this recommendation the impact on salaries on 2016 is estimated to be approximately $120,000 assuming all new compliment is in place for six months of the year.

Council also directed staff to identify $50,000 worth of savings and / or increased revenue opportunities. As previously identified in this report, staff have already commenced a review of Planning and Development fees as recommended by KPMG and will be presenting the results of that analysis in a separate report. Potential savings or cost avoidance opportunities that arise as a result of implementing the framework for organizational excellence will be presented to Council through the annual status report.

Respectfully submitted:

_________________________________

Blaine Parkin, P.Eng.

Deputy CAO

Attachments:

□ DCAO-2016-01 Attachment No. 1

□ DCAO-2016-01 Attachment No.2

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Approved By: Department: Status: Mark Sirr, CPA, CMA Finance Approved - 29 Jan 2016 Brendan Holly CAO Approved - 29 Jan 2016

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cutting through complexity

DetailedOrganizationalDesign

Newiecumsem

Service Delivery Review

Final Report

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rfo

ew

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:2:

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General Manager — Development and_ General Manager/CFO

Infrast rucure ServicesCorporate Services

New ns:

1. No New Positions

1. Chief Administrative Officer - lead the municipal organization and oversee the delivery of municipal services on behalfof the elected Council of the Town of New Tecumseth. Specific functional responsibilities include strategic planning,economic development, legal services and internal/external communications.

2. Director of Emergency Services] Fire Chief — lead the delivery of ?re protection services and emergency managementfor the Town. Given the unique role of the position, it reports directly to the CA0.

3. Economic Development Officer— assist the CA0 in the delivery of economic development services.

@ 2015 KPMG LLP 3 Canadian limited liability partnership and a rvember mmof the KPMG network of mdepesdent member ?rms afnlvaled with KPMG lntematcvaCoopera!:~..'e( KFEVJGInternational ) a SWISSenhty All rights reserve: KPMG CONFIDENTIAL 67

ChiefDetailed Organizational Design

Dimlnrtf?nnergicy Suites] ?e

Cannlmtatims Cootdiaatnr

dice o?he CAOStratgfc Flaming Orgmiutional

(weigh, SoI:itor Amide, IntamllExternal

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General Manager/CFOCarponate Services

Corporate Services DivisionDetailed Organizational Design

New Positions:

1. GM Corporate

Services I CFO

Administrative

Assistant to GM

Manager AssetPlanning &

Management

GM of Corporate ServicesICFO —to lead the internal back ce services of financial planning, accounting, HR, Clerks &Asset Management. The position’s mandate will be to ensure the organization has the necessary support and financialdata to effectively and ef?ciently deliver their services.

Manager - Asset Planning 8. Management - under the direction of the GM Corporate, lead and implement the Town’sasset management program, speci?cally, the co-ordination of capital planning of all facility & linear assets. TheProvince has identified asset management plans as a key prio for Ontario municipalities and expects them toprepare and implement these plans.

Manager - Financial Planning - under the direction of the GM Corporate, lead the annual budget process and implementa long term financial planning process for the Town. The lack of long term financial planning is significantly affectingthe overall performance of the municipality. The current ng complement of the Finance Department does not havethe capacity or expertise to deliver this key service.

Manager — Financial Services (Deputy Treasurer) - under the direction of the GM Corporate, lead the treasury functionsof the municipality including NP 8. AIR, utilities and taxes, internal control and financial statement preparation.

Director of Human Resources - under the direction of the GM Corporate. lead the human resource functions for theorganization including labour relations, health and safety, payroll, performance management and training.

Director of Council Services - under the direction of the GM Corporate, lead the delivery of Council support servicesincluding all those services identified under legislation that are the responsibility of the Town Clerk.

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Manapment

Adnllisuaun Asistart

Manage —F'nancial Flaming DE|1|?VTrasure1IManag ofFnandal Dkectnr of Human Ruounzes Town ChrklDlrecur Coumll Senikes

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theRay too

.sse'l~

vummu-aarm

_ 4%,_‘

Detailed Organizational DesignAsset Manage ent Branch

Establish an Asset ManagementBranch responsible for capitalplanning and asset ma ment ofall linear and facility a

Move GIS from Engineering Servicesto Asset Management — GIS is a backoffice support service for all thedifferent functions ofmunicipality. It is a Iforimplementing the a managementplan.

In a phased approach,Supervisors with supportingtechnicians dedi toInfrastructure and Facility AssetManagement, respe Iy.

Mauager—Asset PlamirgManagement

Su|atvba'— Irflasirtlrtlre AM supgvlm--35 Suparvkor- Faclily AM

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Financial Services (Treasury) BranchDetailed Organizational Design

Establish a Financial Services Branch to be responsiblefor the treasury functions of the municipality, includingAIP & AIR, tax & utility billings, internal control andstatement preparation.

Establish a Manager of Financial Services position fromexisting staff complement to lead internal control andpayabl receivables. This position is restructured fromthe current ?nance department leadership.

De;utyTreamrer/Manager ofFhandal Serums

Supewlsor- Acoomths Supervkor - Revenue

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nnaiak

Detailed Organizational DesignHuman Resou es Department

Human Resources depa ent to manage anddeliver health & payroll, labour relationsand training services for organization.

As the organization continues to grow andevolve, the Human Resources department willrequire further resources to deliver on itscomprehensive mand

There are no changes to Human Resourcestaffing.

HROf?oerlHealth8. safetynator

HR supervisor

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General ManagerDevelopmz-r‘! 8. Inlrasuucure Scrwces

Development & Infrastructure DivisionDetailed Organizational Design

Dlramr cf Park, ReueaionD’recI)rdEng'ne|irgSav'I:5 Di'a:urdP¢l1ic\Abr1s D‘ra:lJrdPhm'rg&DevdnpnmI

GM of Development & Infrastructure Services - to lead the citizen facing services involving engineering, public works.planning and development and parks and recreation. The position’s mandate will be to ensure the organization iseffectively and ef?ciently delivering services that are valued and required by the citizens of New Tecumseth.

Director of Engineering - under the direction of the General Manager, lead and implement the Town’s engineeringservices and capital program.

Director of Public Works - under the direction of the General Manager, lead the operations and maintenance of theTown’s water and wastewater system and the Town’s road network.

Director of Planning & Development - under the direction of the General Manger, lead the planning and developmentprocesses from policy planning to plan approval to construction.

Director of Parks, Recreation & Culture — under the direction of the General Manager, lead the delivery of recreationprogramming and the operation and maintenance of Town facilities.

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Engineering Services DepartmentDetailed Organizational Design

New Positions:

1. None - Existing

positions are ed

Establish an Engineering Servicesdepartment that is responsible fordevelopment engineering and thedelivery of all infrastructure and facilitycapital projects.

Bringing ether Facility andInfrastructure Capital Projects underone Dire r ofengineering serviceswill improve the integration andenhance the synergy between thesetwo functions.

Manager of Development Engineeringposition is established through therestructuring of existing complement.

Facility capital project implementationwill be moved from Parks andRecreation, Culture. There will be arequirement to examine the staffingcomplement for Engineering Serviceswith this change.

CiericalAssistantDifecmrd Engheemg services(Shared with Planning Department)

Manager Development Ergineerhg Manager —Capita|Projects

Ens‘neen'nsfnordinator Engineering Coordinator(3) (4)

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Waterlwastewatejr Branch

lavew:ita'vI.WéI.

ac!

wateski

pcifable water as wellas the collec?onxaridaim

‘

Detailed Organizational Design

The r and Wastewater Branch isresponsible for the supply and di bution of

tre ent of wastewater.

There are no changes in the staffing Is forthe stewater Branch. Theorganational chart has been modi?ed torefl the new

Di?fU7lDR%rI

Mum:-Iuulhnaus

Supavhu-Vhllzuna

© 2015 KPMGLLP_ a Canadn limited Iiabililypannership and a memberfnn of the KPMG network of independent memberfwms affiliated with KPMG InternationalCooperative (‘KPMG International“), a Swiss entity All rights reserved, KPMG CONFIDENTIAL

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"" _-_Priority Position Funding Phasing

These four positions

ect the next level of

prio for the

organization based upon

our analysis of the Town

of New Tecumseth’s

operations. specifically:

1 Emphasis on

Performance

2. Dedicated asset

management & long

term ?nancial

planning function

3. Clearly defined

Supervisory areas

within Parks,

Recreation & Culture


Changes to the Staffing Complement — Medium Priority

Medium Supervisor of Infrastructure AssetManagement

Medium Supervisor of Facility AssetManagement

Medium Supervisor of Parks

Medium Supervisor of Facilities

Total Net Financial Impact (Annual)

New Position

New Position

New Position

New Position

24 Months

24 Months

24 Months

24 Months

$300,000

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These three positions

reflect the lowest level of

priority for the

organization based upon

our analysis of the Town

of New Tecumseth’s

operations. These

positions would be

brought on board when

the amount of work for

the service areas

demands additional


Changes to the Staffing Comple ent — Low Priority

Low Infrastructure Asset Management 36 MonthsTechnician

Low Facility Asset Management Technician 36 Months

Low AdministrativeAssistant to the GM 36 Months

Total Net Financial Impact (Annual) $185,000

Priority Position Funding Phasing

3 2015 KPMG LLP, a Canadian limited iiab‘-‘ty partnership and a memberfirm of the KPMG r 5.-i:v"<oiindependent member firms affiliated w 1' «(MTG i"',en"af=ona|

( KPMG International) a Sw ss enity Al: righls resen/ed KPMG CONFIDENT83

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cutting through complexity

Opponun?msforhnprovedOperationalEfficiencies andEffectiveness

New Tecurnseth

Service Delivery REVIEW

Final Report

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1

Potential Opportunities

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Internal processes are manual and isolated or siloed and vary across departments.There is opportunity to improve Department—specific processes, as well asintroduce service level standards to standardize expectations and driveperformance. Clearly identifying service level standards and presenting to Councilthese standards will improve not only the Town's effectiveness but also thetransparency in its operations.

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19 From our review of the Town's financial position, it has become apparent thatthere is an opportunity to review the Town's cost recovery through user fees. Incomparison to its municipal peers, the Town recovers the least through user feesA review of user fees will increase the ability for the Town to fund servicesdirectly attributable to the individual citizen and lessen the impact on the tax levy.

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organizational excellence implementation plan summary

Documents