How do departments evaluate and update their course requirements? To begin with the main question: how do academic departments evaluate their course requirements?  By that I mean, how do departments decide if they are requiring too many classes, not enough classes, not the right classes, etc.?  The question also could be generalized to "how do departments decide what classes to offer"?  I'm especially interested in evaluation of what courses should be required, but I'm also interested in how that interacts with the overall course offerings of the department (e.g., what might lead departments to reorganize classes to reduce overlap).

I anticipate that the answer will vary quite a bit depending on the size of the department, the field, the type of school, etc.  I welcome that variety.  What interests me most is whether there are established decision-making processes for this.  (For instance, is it something that is specifically looked at when a department undergoes external review, and if so, how exactly does the external review committee evaluate it?)  I'm interested particularly in coursework requirements for grad programs, but would be interested in relevant comparisons with undergrad programs as well.

The background: I graduated from a PhD program about a year ago and have a number of friends who are still in the program.  Over the last few years (beginning in my last two or three years and continuing to the present), there have been some shifts in the department in terms of the size of incoming cohorts and the funding decisions for the new students as well as ongoing funding for more senior students.  This has created an environment of worry and uncertainty among some grad students who fear that there is an increasing disconnect between the assumptions of the department funding process and the reality of student progress.  (Simply put, people worry that most students will run out of funding before they finish, because the funding is for X years but nearly everyone takes more than X years to finish the program.)  There is a perception among some of the students that one contributor to this problem is the heavy coursework load, both because it delays students from starting on their own research, and because logistical hurdles (e.g., not having the right classes offered when you need to take them) make it difficult to complete the requirements in the supposedly "normal" time.

I did a bit of informal research and found that the coursework requirements for my department, compared to those of many other departments at the school (some related to my department, some not). are substantially greater (in terms of number of units required) and less flexible (i.e., much more "you must take course X" and less "you must take one of these three courses").  The department's requirements are also somewhat heavier than those of departments in the same field at other comparable schools.

So what I'm curious about is, is this a reasonable approach to evaluating coursework requirements?  I don't mean to suggest that this alone would mandate changes; no doubt many kinds of information would be considered together.  But is it the sort of thing that departments (or external review committees) would do to get a sense of how reasonable the curriculum is?  Is it the sort of thing that, if known, would be expected to arouse concern among the faculty?  If not, what sort of thing would?  How do departments assess their course requirements, and what would make them think they should be changed?
Departments ought to be concerned about their graduation rates. If the rates are low, it is a good idea to find out why and make changes. This could be changes to the curriculum, it could be changes to the admissions policy, or any number of other things. 

Benchmarking is certainly a reasonable approach to review the current rules, although niche marketing often gives incentives to introduce distinguishing features that are consciously pitched against the prevailing practices. 

I presume your department has a curriculum committee. Request a meeting and see where that leads.