Professional Documents
Culture Documents
that it was legally compliant, they had the opportunity to discuss what if
situations with an HR professional, and hopefully, in case they had any major
issues they would know whom to turn to for advice.
Q2. Discuss the methods used in the HR Audit process.
Explain the methods used in the HR Audit process
Answer:
Explain the methods used in the HR Audit process:
A good starting point for the audit process is to take some time and reflect
on the HR functions which need to be audited. Simply listing them is a good
first step. For achieving organisational goals, it is very important to carry out
various HR functions smoothly. In this step of the audit process, we define
the various functions which need to be audited.
In this step, consider your areas of responsibility and traditional HR practices covered by the
functions you need to audit. While starting out, it is better to make more general statements and
improve from year to year in those areas that you choose to raise the level of performance. For
example, as an audit manager, you may decide to audit any of the following:
All human resource functions.
Any specific function such as the recruitment process of your company.
Any part of the specific function you have selected for audit such as generating
applicant pool function of the recruitment process.
The main purpose is to study and analyse each one of the specific areas of HR management. The
analysis should focus on the planned measures, the method of implementation, and the results
obtained. In order to carry this out, the areas that need to be audited must be identified. A list of
the indicators corresponding to the different areas of the HR function could contain some of the
following:
Description of the staff of the company
The complete staff can be described by:
Hierarchic levels
Years of service
Qualification
Sex
Nationality
The number of permanent and temporary employees, interns and physically or mentally
challenged employees.
Indexes of personnel rotation and absenteeism.
Job analysis
The various indicators of job analysis are as follows:
The number of described posts
Occupants per post
Degree to which the job description cards have been updated
The degree of detail in the job description cards
The methods used to analyse and describe the jobs.
HR planning
HR planning, as you have studied in unit 7, is an important area of preplanning which includes
the methods employed to plan personnel needs, the measures adopted to cover future personnel
needs, and the temporary planning horizon.
Recruiting and personnel selection
Main indicators of this are as follows:
The number of days required to fill in a vacant post
The number of applications received by work place categories
The average amount of days between the reception of the application and
recruitment
The average cost of recruitment
Cost of selection per job post
The degree to which internal and external sources of recruitment are used
The average number of candidates that do not pass the selective tests
The study of the reliability and validity of the selection tests
Training and development
The training indicators are as follows:
The procedures followed
Frequency at which personnel training needs are analysed
The criteria followed in the training programmes
The evaluation criteria for the efficiency of the training programmes
The percentage of the HR budget allocated to training
The average number of hours of training per employee
The percentage of employees that participate in training programmes by
workplace categories.
3. Negotiating Ability: The need for this skill arises when two or more
parties argue on a common issue and each party wants a conclusion that it
prefers. The behavioural aspects and elements related to negotiating ability
7. Creativity: It is not only the quality of the product that plays a role in the
market. It is also how different our products are, compared to that of our
competitors, and how useful they are, which attract our customers. This
requires creativity. This will also bring about a huge difference in the way
regular day-to-day activities are carried out. The behavioural aspects
and elements related to creativity
f) The need for redundancy and plans to check of human resources and to
change the techniques of management.
g) Planning for physical facilities, working conditions, the volume of fringe
benefits such as canteen, schools, hospitals, conveyance, child care centres,
quarters, company stores, etc.
h) Development of various sources of human resources to meet the
organisational needs. Audit of HR planning helps ensure that you have
reliable monitoring and planning systems in place, so that the implications
for strategic and cost planning can quickly and easily be assessed. Normally
auditing addresses
the following six areas:
1. How to develop and introduce an effective HR planning system.
2. How to estimate workforce requirements for the organisation.
3. Understanding and predicting the available labour supply.
4. How to analyse the supply and demand balance, and deal with a surplus
or a shortfall.
5. Handling the implications for recruitment, internal redeployment, pay and
rewards, training and development, and employee retention.
6. Monitoring organisational plans, i.e., how to develop a system that will
give you reliable early warnings of problems ahead.
The audit of HR planning helps to take steps to improve human resource
contributions in the form of increased productivity, sales, turnover, etc. It
facilitates the control of all functions, operations, contribution and cost of
human resources.
Now read the case 1 given at the end of the unit about the central bank,
which is facing challenges on the manpower front from various directions
such as retirement and skill upgradation. It covers the various areas of HR
planning audit. By reading this you will understand importance of verifying
the HR policies so as to minimise future problems.
(ii)Concept of Audit for HR Climate
HR climate has impact on motivation, morale and job satisfaction. Quality of
HR climate can be measured by examining:
1. Employee turnover: In a HR context, turnover or staff turnover or
labour turnover is the rate at which an employer gains and loses
employees. Simple ways to describe it are "how long employees tend to stay
in a given organisation or industry. Losing employees may include
factors such as deaths, transfers, retirements and resignations. High
turnover may be harmful to a company's productivity if skilled workers are
often leaving and the worker population contains a high percentage of novice
workers which can lead to increased cost. Reduced employee turnover is an
excellent measure of HR climate. Some areas that lead to employee turnover
are better hiring practices, orientation, working conditions, remuneration and
benefits, and advancement opportunities.