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Audits and Evaluations

Audit of Innovation Management

Executive Summary

Background

The Audit of Innovation Management was part of the 2010-2013 Risk-Based Audit Plan which was recommended for approval by the Departmental Audit Committee and subsequently approved by the Deputy Head in September 2010.

To continue to fulfill its mandate in an increasingly digital world, Library and Archives Canada (LAC) has embarked on an ambitious modernization exercise made up of 12 modernization innovation initiatives (MII).

The objective of the audit was to determine if the innovation management governance process and internal control procedures were adequate and effective to allow LAC to fulfill its modernization objectives.

Findings and Recommendations

Governance
A governance structure with clear roles and responsibilities for the management of innovation projects was formally adopted. Its effectiveness should be improved with the use of a challenge function supported by a formal and active mechanism to report and monitor progress.

Rigorous Approach
A rigorous structure for change management, project management and risk management was not available to support the implementation of the MIIs effectively. However, individual project management structures were established for some MIIs and provided a level of monitoring that enabled the achievement of a number of the innovation project deliverables.

An infrastructure and capacity for change management and project management, aligned with the needs of LAC, should be developed to support project managers and to demonstrate sound stewardship in project delivery at LAC.

The risk-management process for innovation initiatives should be reviewed regularly and documented appropriately to ensure that significant risks are considered, monitored and mitigated with appropriate measures.

Communication
A number of departmental communication tools were used during the MII development period to communicate information to employees. However, evidence shows that these measures had moderate success. Although the common direction of modernization was known to staff, the implications were not well understood. This had an impact on the degree of engagement staff had towards the Modernization initiative. Furthermore, managers were not equipped to ensure continuous engagement and communication with staff.

It is necessary to implement a strategy for managers and executives to support continuous communication and engagement of employees with respect to modernization.

Audit Conclusion

The audit concludes that an innovation management governance structure is in place, but improvements are required to the challenge function to support an effective governance process. Furthermore, internal control procedures need to be enhanced for sound stewardship to effectively achieve innovation objectives.

The establishment of the MIIs was a major step in the modernization of LAC. As LAC continues to innovate, care should be given to its evolving governance structure. A changing environment always presents major challenges including reaching the right balance between staff engagement and moving the agenda forward.

An extensive and regular internal consultation process among all levels of LAC ’s various sectors and corporate functions would foster creative thinking and encourage openness to new concepts. Modernization will only be accomplished by breaking down the functional silos and looking at LAC ’s mandate as a continuum where each sector has a role to play in achieving the objective.

Statement of Assurance

This audit engagement was planned and conducted to be in accordance with the Internal Auditing Standards for the Government of Canada. In my professional judgment as Chief Audit Executive, sufficient and appropriate procedures have been conducted and evidence has been gathered to support the accuracy of the conclusions reached and contained in this report. The conclusions are based on a comparison of the situations as they existed at the time of the audit and against the audit criteria.

Acknowledgements

Since the conduct phase of the audit, we understand that management has already initiated certain activities that will serve to address some observations mentioned in this report.

We wish to express our appreciation for the cooperation and assistance afforded to the internal audit team by management and staff during the course of this assurance engagement.

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