HR Audit Notes

8/6/2019 HR Audit Notes

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HR Audit Notes HUMAN RESOURCE AUDIT

DEFINITION:

Human Resource Audit is a systematic assessment of the strengths, limitations, anddevelopmental needs of its existing human resources in the context of organizational performance – (Flamholtz, 1987)

NEED FOR H.R. AUDIT:Top Management saw solutions to their problems, issues andchallenges in HRD to face business competition and to achieveorganizational goals.

PURPOSE OF H.R. AUDIT:1. To examine and pinpoint strength and weaknesses related

to H.R. areas and Skills and Competencies to enable an organization to achieve its long-term and short-term goals.2. To increase the effectiveness of the design and implementation of human resource policies, planning and programs.3. To help human resource planners develop and update employment and program plans.

SCOPE OF HUMAN RESOURCE AUDITWhenever the H.R. Audit it taken up, the scope is decided. Audit need not be exhaustive, but should be focused on particular function of H.R.M. such as Training andDevelopment, Performance Appraisal, Compensation, etc.. However, the objective andapproach of H.R. Audit, more or less, remains the same, regardless of scope.

APPROACH TO H.R. AUDIT1. Self – directed surveys.2. Task Forces within the organisation.3. Out side Consultants.

AUDITING PROCESS: STEPS IN H.R. AUDITAuditing process varies from organizations to organizations.Generally involves following STEPS:

STEP ONE: Briefing and Orientation:Key Staff Members meet:i. To discuss particular issues considered to be important.ii. To chart out audit procedures, andiii. To develop plans and program of audit.

STEP TWO: Scanning material information:Scrutiny of all available information pertainingto personnel, personnel handbooks and manuals,



guides, appraisal forms, computer capabilities andany other related information.

STEP THREE: Surveying employees:a. Interview with key managers, functional executives,

Top functionaries in the organisation and employeesRepresentatives, if necessary. b. The purpose is to pinpoint issues of concern,Present strengths, anticipated needs and managerialviews on human resources.

STEP FOUR: Conducting interviews:

I. What questions to be asked, are developed during

scanning of information.II. It is better for H.R. Audit, if clarity about the keyfactors of H.R.M. selected for audit and the relatedquestions that need to be examined.

STEP FIVE: Synthesising:

The data gathered is synthesized to present thea. Current Situation. b. Priorities.c. Staff pattern, andd. Issues identified.

STEP SIX; Reporting:

1. The results of the audit are discussed withManagers and Staff Specialists, in severalrounds.2. Important issues are identified for inclusion in the formal Report.

H.R. AUDITTOPICS (AREAS) FOR INTERVIEW QUESTIONNAIRESAND RELATED ASPECTS

1. INFORMATION

• COVERAGE



• SOURCE• ADEQUACY• GAPS

2. FORECASTING

• METHODOLOGY• RELIABILITY• TESTABILITY• BUDGETING• TIME ORIENTATION• TECHNOLOGY PERSPECTIVE

3. TRAINING AND DEVELOPMENT

• NEED ASSESSMENT

• SELECTION CRITERIA• LEVELS COVERED AND FREQUENCY• INTERNAL VS EXTERNAL TRAINING• QUALITY CONSCIOUSNESS• CHANGING NEEDS• CLIMATE FOR SELF-DEVELOPMENT

4. PERFORMANCE APPRAISAL

• VALIDITY OF APPRAISAL PROCESS• FITNESS• BENEFITS AND/OR DRAW BACKS/PROBLEMS• KNOW-HOW OF APPRAISING• CLEAR OBJECTIVES• UNIFORMITY IN PROCESS

• UNDERLYING BENCHMARKS• CONSISTENCY IN RATINGS• LINKAGES WITH PAY• FEEDBACK TO EMPLOYEES• CHANGING NEEDS

5. MANAGEMENT SUCCESSION PLANNING

• POLICY FORMULATION• IDENTIFYING KEY POSITIONS• AVAILABILITY OF SUCCESSORS• MATCHING FUTURE NEEDS• RESPONSIBILITY FOR GROOMING



AND DEVELOPING• HANDLING NON/POOR PERFORMERS

6. COMPENSATION

• APPROPRIATENESS OF POLICIES• COMPANY PHILOSOPHY• ADEQUACY OF REWARDS• NATURE OF JOB DESCRIPTIONS• FLEXIBILITY IN JOB EVALUATION SYSTEMS• CONTROL OVER COSTS• RATIONALE OF REWARD SYSTEM• OPPORTUNITIES FOR IMPROVEMENT

7. AFFIRMTIVE ACTION

• EFFICIENCY OF ACTION PROGRAMMES• LESSONS FOR FUTURE

8. SPECIAL ASSIGNMEN(OTHER H. R. FUNCTIONS)

• CLARITY• COMMENTS• ACTIVITIES JURISDICTIO

9. NEED INTER-RELATIONSHIPS

• UNIQUENESS• DISTINCTIVENESS• PRESENCE AND AWARENESS OF ABOUTCOMPANY’S H. R. POLICY• CLARITY ON OBJECTIVES OFH.R. AUDIT• FUTURE OUTLOOK ON PHILOSOPHY* CAPABILITIES ON IMPLEMENTATION

10. THE STAFF FUNCTION(THE H.R. STAFF)



• EXPECTATION FROM HUMAN RESOURCE STAFF• DEGREE OF SATISFACTION• ADEQUACY• ATTIDUDE AND APPROACH• CAPABILITY AND POTENTIAL

• SUGGFESTION FOR CHANGE

*****

CHALLENGES FOR H.R. DEPARTMENT

EIGHT CHALLENGES IDENTIFIEDBY DAVE ULRICH (1997)

1. GLOBALISATION INVOLVES

• NEW MARKETS• NEW PRODUCTS• NEW MINDSETS• NEW COMPETENCIES• NEW WAYS OF THINKING



H. R. DEPATMENTS WILL NEED TO CREATEMODELS AND PROCESSES FOR ACHIEVING:

• GLOBAL ACTIVENESS• COMPETITIVENESS

• EFFECTIVENESS2. VALUE CHAIN FOR GLOBALCOMPETITIVENESS AND HR SERVICES

• BUILDING CUSTOMER-RESPONSIVENESS ORGANISATION THROUGH:

a. Innovation b. Faster Decision Makingc. Price or Value Advantaged. Effective linking with Suppliers

3. GROWTH OF ORGANISATION

• By INCREASING Customers• BY MERGERS• BY ACQUISITION• BY JOINT VENTURES

HR ISSUES INVOLVED:

• Having EXECUTIVES with BUSINESS MINDSET.

- For CUTING COST on hiring PEOPLE.

- For overcoming CHALLENGE in New Business.

4. BUILDING ORGANISATIONAL CAPABILITIES

• Reviewing Existing Capabilities• New Capabilities.• Aligning Capabilities with Business Strategies.

5. MANAGING CHANGE

• Adopting some new H.R. Practices.• Learning some New Skills and Attitudes.



• Unlearning some existing skills and Attitudes.

• Modifying Mindset of Executives and Employees.

6. MAKING TECHNOLOGY VIABLE

• Finding out ways and means tomake technology successful.

7. ATTRACTING AND RETAINING

COMPETENT PEOPLE• Attracting Talented People.• Retaining them.• Utilising them suitably.

8. TRANSFORMING ORGANISATION

• Creating fundamental and lasting changes.

*****

PRINCIPLES FOR HRM EFFECTIVENESS

SIX PRINCIPLES OF Dr. T. V. RAO ARE BASED ON HIS OBSERVATIONS ANDPERSONAL KNOWLEDGE ABOUT THE 11 NATIONAL HRD AWARD WINNERS,DURING THE PERIOD FROM 1989 TO 1997.



DR. RAO OBSERVED, FOLLOWING COMMON TRAITS ANDCHARACTERISTICS IN THE AWARDEES:

i. ROLE MAKERS NOT ROLE TAKERS.

II. INTEGRATION OF HR POLICIES AND PRACTICESWITH COMPANY BUSINESS.

III.VERSATILITY FOR ONE ROLE TO OTHER.IV.THRUST FOR LERNING.V. ALL ARE NOT HR MANAGERS.VI. READY TO HANDLE LINE RESPONSIBILITIES.VII. HAVING HIGH APPLIED BEHAVIOURAL SCIENCE ORIENTATION.¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬¬_________________________ _______________________________________________

SIX PRINCIPLES FOR BECOMING AN EFFECTIVEHR MANAGER:

1. RESPECTING EACH OTHER’S TIME.

2. BECOMING TRUSTWORTHY AND PROMOTING TRUSTWORTHINESS.

3. CONTINUOUS INTROSPECTION OF ROLES AND RESPONSIBILITY OF SELFAND THE GROUP.

4. LEARNING FROM NEIGHBOURS FOR CHANGE AND REFLECTION.

5. PAYING ADEQUATE ATTENTION TO THE CULTURE AND VALUES IN THECOMPANY AND THE COUNTRY.

6. USING PERSONNEL POLICIES FOR EMPOWERING EMPLOYEES ANDPROMOTING MANAGERIAL EFFECTIVENESS AND NOT FOR BLOCKINGCREATIVITY AND INNOVATION.

H. R. COMPENTENCIES

1. Knowledge of H.R. practices:- Staffing.- Development.- Appraisal.- Rewards.- Organisational Planning.- Communication, Etc...



2. Mastery of Human Resource:- Every thing about H.R.3. Knowledge of Business:It means knowing about:- Financial.

- Strategic.- Technological variables and their influence on business.

4. Mastery over Change process and Change Management:

- Creating Meaning.- Problem Solving.- Innovation.- Transformation.- Relationship Influence.- Role Influence.

5. Mastery of Business:It means knowing about following capabilities of theorganisation:

- Business,- Financial.- Strategic.- Technological.- Organisational.

METHODS OF H.R. AUDIT

FOUR METHODS:

1. INDIVIDUAL INTERVIEW METHOD2. GROUP INTERVIEW METHOD3. WORKSHOP METHOD4. QUESTIONNAIRE METHOD

FOR H.R. AUDIT, EITHER COMBINATION OF METHODS OR ALL THEMETHODS ARE USED.

I. INDIVIDUAL INTERVIEW METHOD:

Top level management and senior managers are interviewed, individually. It helps infollowing:

A. Knowing their thinking about future plans and opportunities availablefor the company.



B. Knowing about their expectations from the H.R.Audit.C. Getting sensitive information pertaining to working styles and culture.

Union leaders, departmental heads, some strategic clients and informal leaders are also

interviewed, individually.In case of small companies, manned by professionals, interviews can be extended withselected employees from different levels and functions.

II. GROUP INTERVIEW METHOD:Group interviews and discussions with the employees and/or executives of largecompanies for H.R. Audit, facilitate collection of information about effectivenessof existing systems.

COMPOSITION OF GROUP:

1. Ideally, the group should be of 4 to 8 persons.

2. Group should consists of same or similar level of employees from cross functionalareas.

3. In case of large organisation, group interviews for each functional area can beconducted, separately.

RELAVANT QUESTIONS THAT ARE ASKED IN INDIVIDUAL AND GROUPINTERVIEWS:

a. What do you see as the future growth opportunities and business directions of thecompany?

b. What skills and competencies does the company have which you are proud of?

b. What skills and competencies do you need to run your business, or to perform your role, more effectively at present?

c. What are the strengths of your HRD function?

d. What are the areas where your HRD function can do better?

e. What is good about your HRD subsystems, such as:

• performance appraisal,• career planning,• job rotation, training,• quality circles,



• induction training,• recruitment policies,• performance counseling,• worker development programmes, and• HRD departments?

f. What is weak about them? What can be improved?

g. What changes do you suggest to strengthen HRD in your company?

h. What do you think are the ways in which line managerscan perform more developmental roles?

III. WORKSHOP METHOD:

In some cases of H.R. Audit, instead of Individual and Group Interviews, WorkshopMethods i.e. Large Scale Interactive Process (LSIP) is conducted, as under:

a. 30 to 300 participants can be asked to gather in a room.

b. They are divided in small groups.

c. They are asked to work either around Systems, Subsystems or around different dimensions of HRD and do SWOT Analysis.

d. All the groups thereafter give presentations.

e. The H.R. Auditor compiles the views of all groups, makesown observation, conclusions and prepares a report.

f. The H.R. Auditor announces the audit Results before submittingthe report to top Management.

LSIP WORKSHOP FOR HRD AUDIT ONPERFORMANCE APPRAISAL SYSTEM



- RELEVANT QUESTIONS THAT HAVE BEEN ASKEDIN ONE OF THE HR AUDIT CONDUCTED BYDr. T.V. RAO:

i. What are the three good things in your performance

appraisal system?ii. What is the one thing you would like to change in your performance appraisal system?

iii. How would you critically evaluate the job rotation inyour company?

iv. What are the strengths and weaknesses of your training policies and practices?

v. What three objectives would you use to describe the promotion policies as they exist in your company?

IV. QUESTIONNAIRE METHOD:

Feed back about various dimensions of HRD, including the competency base of HRDstaff, the styles of line managers, the implementation of various HRD systems, etc areobtained through a detailed questionnaire from individuals or groups for H.R. Audit. Thismethod helps in benchmarking.The process is as follows:

a. Detailed questionnaire is prepared by H.R. Auditor.

b. Individuals or groups are asked to assemble in a room or hall are explained theobjective and process of HR Audit. They are then given questionnaires.

c. They submit the questionnaire, duly filled in, to the HR Auditor.

d. The HR Auditor compiles the feedbacks, makes observations, conclusions andrecommendations.

e. Audit Results are informed to the Participants beforethe report is submitted to the top management.

*****



OSERVATION, ANALYSIS OF SECONDATY DATA, REPORTS, MANUALS ANDOTHER PUBLISHED LITERATURE

OBSERVATION:

In addition to following the said methods, the HR Audit, needs to undertake following toassess the extent to which a congenial and supportive human welfare-oriented climate

exists in the company:1. Visit workplace, plant, machinery room, canteen, toilets, training rooms, hostels,hospital, school, living colony, etc., as applicable.

2. Observations can be made through a checklist.

ANALYSIS OF SECONDARY DATA:

This can provide an insight into the HRD assets and liabilities of the company. For example in the are of training, it may reveal as to whether employees are given trainingsystematically or otherwise, the cost involved for training, the age group of employeesattended training programmes, the purpose of training the employees etc..

ANALYSIS OF REPORTS, RECORDS, MANUALS AND OTHER PUBLISHEDLITERATURE:

Study and analysis of said documents help in assessing the strengths and weakness of HRD.

*****



H.R.AUDIT METHODOLOGY(INDIVIDUAL INTERVIEW METHOD – HOW TO INTERVIEW AND FRAME QUESTIONS?)

INTERVIEWS BEGIN WITH THE CEO ANDTOP MANAGEMENT

PURPOSE:• TO KNOW EXPECTATIONS OF CEO.

• TO EXPLAIN SCOPE AND LIMITATIONS OF HRA.• TO GET COOPERATION FROM STAFF.• TO KNOW STRATEGIC LONG-TERM AND SHORT-TERM PLANOF THE ORGANISATION.

CEO SHOULD BE INTERVIEWED, SEPARATELY.

BRIEFING SESSION WITH CEO, COVERS:

• HRD AUDIT AND ITS METHODOLOGY.• SCHEDULE OF H.R. AUDIT.• ASKING CEO OF HIS/HER EXPECTATIONS.• EXPECTATIONS, WHICH CANNOT BE MET.

IF DESIRED BY CEO, BRIEFING SESSION OF SENIOR AND TOP MANAGERSCAN BE HELD IN A GROUP:

BRIEFING WILL COVER FOLLOWING QUESTIONS-

• WHAT IS HRD?• WHAT IS HRD AUDIT?• WHAT IS REQUIRED OF THE LINE MANAGERS IN INDIVIDUALOR GROUP INTERVIEWS?



• WHAT HAVE BEEN THE FINDINGS OF GROUP.

HR AUDITOR TO TELL DURING BRIEFINGS TO CEO AND SENIOR/ TOPMANAGEMENT:

• HR AUDIT IS NOT A PROBLEM-SOLVING EXERCISE.• IT WILL NOT GIVE FEEDBACK ABOUT INVIDIDUALS, BUT ABOUTSTRUCTURE, COMPETENCY LEVELS, LEADERSHIP,PROCESSES ETC.• IT IS COMPREHENSIVE, BUT CAN BE FOCUSED ON ONE OR MORESYSTEMS.• ACTION ON HRD AUDIT REST WITH CEO.

FORMULATION OF QUESTIONS FOR INTERVIEW WITH CEO:

WILL BE BASED ON FUTURE PLANS OF THE COMPANY IN THE AREAS, THE

COMPETENCY REQUIREMENTS AND PREPAREDNESS OF H.R.• DIVERSIFICATION,• NEW MARKET,• NEW BUSNESSES,• NEW AREAS• SCALE OF OPERATIONS,• EXPORT,• ANY CHANGE OR CONSOLIDATION.

INTERVIEW QUESTIONNAIRE:

• WHAT DO YOU SEE AS THE COMPETENCY REQUIREMENTS FOR THEFUTURE?

• WHAT COMPETENCY GAP DO YOU SEEIN THE EXISTING STAFF?

• WHAT NEW COMPETENCIES NEED TO BE DEVELOPED IN THE STAFF ANDHOW DO YOU PROPOSE TO DO THAT?

INTERVIEW WITH THE HRD CHIEF

OBJECTIVE:



• TO UNDERSTAND THE EXISTING SYSTEMS, STRUCTURE, SKILLS OFSTAFF, STYLES OF TOP MANAGEMENT AND RELATIONSHIP WITH THE HRDPHILOSOPHY, PROBLEMS ETC..

• TO UNDERSTAND HRD CHIEF’S PERCEPTIONS:

1. ABOUT TOP MANAGEMENT AND THE SUPPORT REQUIRED FROM THEM.2. ABOUT LINE MANAGERS, THEIR COMPETENCIES AND INVOLVEMENT INHRD MATTERS.3. ABOUT UNIONS AND THEIR INVOLVEMENTIN HRD RELATED ISSUES.

• THE COMPETENCIES OF HRD DEPARTMENT AND STAFF.

• TO UNDERSTAND THE INTERNAL CUSTOMER FRAMEWORK OF HRDDEPARTMENT.

• TO FIND OUT THE TIME DIVISION AND HOW TIME IS SPENT BY THEDEPARTMENT.

• TO ASCERTAIN VIEWS ON HOW VARIOUS SYSTEMS ARE WORKING.

• TO GET A SWOT ANALYSIS OF HRD SYSTEMS.

• TO PREPARE A LIST OF DOCUMENTS VIS-À-VIS CHECKLISTOF HR AUDIT.

FRAMING OF INTRVIEW QUESTIONNAIRE, BASED ON SAID DIMENTIONSFOR INTERVIEW WITH HRD CHIEF:

• WHAT ARE THE OBJECTIVES OF YOUR DEPARTMENT?• WHEN AND HOW WAS IT SET UP?• WHAT ARE THE SIGNIFICANT MILESTONESAND CONTRIBUTIONS OF THE DEPARTMENT?• WHAT ARE IT’S CURRENT ACTIVITIES?• WHAT IS THE ORGANISATIONAL STRUCTURE?• HOW ARE THE STRATEGIES OF HR AND HR PLANS FORMULATED? WHATIS THE ROLE OF THE DEPARTMENT IN STRATEGIC PLANNING?• WHAT ARE THE MAIN COMPETENCIES OF HRD STAFF? WHICH ARE THE



COMPETENCIES THEY NEED TO DEVELOP?• What are the styles of Top and Senior level Managers?To what extent the styles are helpful in developing learning culture?• What are the main blocks in developing learning culture?• How are the line managers supporting their juniors in developing? What needs to be

done to make them more supportive?• What is the extent of support given by Top Management to HRD?• Is there a separate budget for HRD? How the same is allocated and what is the supportof Top Management?• What is the HRD philosophy and values?• What the core competencies of each department and of the organisationas a whole?• What is relationship between Personnel and HRD Departments? Is there need for further strengthening Integrating or differentiating the functions or activities of the two?• What the strengths and weakness in the following systems of your organisation:

i. Performance Appraisal.ii. Counseling.iii. Training.iv. Career Planning and Development.v. Succession Planning for strategic roles.vi. Job Rotation.vii. OD and Team Building interventions.viii. Research and System Development.ix. Mentoring.x. Culture- Building Exercises.xi. Quality improvement interventions.*****

INTERVIEWS WITH LINE MANAGERS:

OBJECTIVE:

• TO UNDERSTAND THEIR PERCEPTIONS ABOUT THEIR:a. HRD needs. b. Current status.c. Expectations.d. Competencies.e. Commitment to HRD.]f. Etc..

FORMULATION OF INTERVIEW QUESTIONNAIRE,BASED ON ABOVE DIMENSIONS:



• What are the HRD needs of your department and yourself?• What kinD of help do you get from HRD Department for competency and commitment building?• What the HRD System that you feel happy about?

• What are the HRD System that you have contributed and contributing in achieving business goals?• What are the strengths of your HRD functions?• What are the weak areas of HRD?• What are your expectations from HRD?• What are the training needs of your department?• Are your training needs taken care of?• What are your career growth? Are they taken care of?• What do you see as future growth of the opportunities and business directions of thecompany?• What the core competencies are skills and knowledge the company has?

• What skills and knowledge do you thing are required to run the business (or to perform better in your job)?• What is good about your HRD sub-systems: Performance Appraisal? Training? JobRotation? Career Planning and development?• What should the HRD Department start doing or do more? What it should stop doing or do less.

*****

INTRVIEWS WITH WORKERS AND THEIR REPRESENTATIVES:

OBJECTIVE - TO FIND OUT:

• THEIR CURRENT DEVELOPMENT NEEDS VIS-À-VIS BUSINESS GOALS OFTHE COMPANY.• THEIR MOTIVATIONAL LEVEL.• CULTURE PREVAILING IN THE ORGANISATION.• GOOD AND BAD PRACTICES OF THE ORGANISATION.

FOMULATING INTERVIEW QUESTIONNAIRE,BASED ON ABOVE:

• How to you feel working in your organisation?• What are the strengths of your organisation?• What are the areas that need improvement?• What do you know about the business plans and opportunities for your company?• What do you know about the competition your company is facing today or is likely to



face in the future?• What are some of the things your company should do to face the changingenvironment?• What is being done to ensure that you all have the skills needed to meet the currentneeds or future challenges of the company?

• What motivates you here?• What more do you think needs to be done to help you contribute better to theorganisation?• What kind of training do you get here? Are you satisfied? What more do you think needto be done in the interest of the company?• What are the facilities available for you in the plant and colony.• What do you think can be done to improve quality, save costs and make people feelhappy to work for the company.• What are your expectations from the HRD Department? What are you happy about?What are your suggestions for them to serve you better.

*****

H.R.AUDIT METHODOLOGY(GROUP INTERVIEW METHOD – HOW TO INTERVIEW AND FRAME QUESTIONS?)

GROUP INTERVIEWS

Advantages:1. Wider coverage of issues.2. Larger involvement of employees.3. Verification of data and significant points.4. Assessment of impact of feelings related to any issue and problem or satisfiers and dissatisfiers.

GUIDELINES FOR SELECTING SAMPLES FOR GROUP INTERVIEWS

Middle level Managers:

• Minimum 10% and Maximum 100% group-wise or department-wise. In any audit, 100Managers individually or in groups should be interviewed.



Supervisors and Staff:

• 10% or 5-6 groups from different functions and workplaces may be selected for audit.

Workmen:

• To be interviewed in large groups. 5-10 groups are advisable.

GUIDELINES FOR INTERVIEWS IN GROUPS

A. Auditors to be introduced to the group by a representative fromH.R. Department.

B. Auditors to brief about the HRD Audit and it’s purpose and usefulnessto the company. Thereafter, questions relating to various systems can beeither asked questions or given a questionnaire to answer in about30 Minutes and after collecting the feedbacks, discussion for another about 30 minutes can be held to know the intensity of the feelings.In either case, notes should be taken.

C. Auditors to consolidate the feedbacks.

FORMULATION OF QUESTIONNAIRE FOR GROUP INTERVIEWS:

As per your view, what are the Strengths and Weaknesses in respect of the followingcomponents of HRD:

Commitment of Top Management to HRD. Performance Review discussions.Recruitment of competent people. Separations.Retention of competent people. Quality Circles.Identification of fast-track-employees. Participative Management.Mentoring System. Shopfloor Committees.Training (In-house & outside). Delegation.Induction. Personnel Policies.Career Planning. HRD Department and Staff.



Succession Planning. Communication.Job Rotation. HRD Culture.Performance Appraisal. Others.

INTERVIEW AREAS,

DIMENSIONS AND QUESTIONSFOR ASSESSING HRD SYSTEMS

POSSIBLE INTERVIEW AREAS, DIMENSIONS, ISSUES AND QUESTIONS CANBE IN THE FOLLOWING HRD SYSTEMS:

CAREER SYSTEM: Manpower Planning and Recruitment. Potential Appraisals andPromotions, Career Planning and Development.

WORK PLANNING: Role Analysis (goal setting), Contextual Analysis, PerformanceAppraisal.

DEVELOPMENT SYSTEM: Training and Learning, Performance Coaching/Counseling,360-Degree performance feedback, Job Rotation/Mentoring, Staff (worker)Development.

SELF-RENEWAL SYSTEMS: Role efficacy, O.D., Action-Oriented Research.

CULTURE SYSTEMS: HRD Climate, Values, Quality orientation, Reward andRecognition, Information, Communication, Empowerment.

TWO EXAMPLES:

HRD SYSTEM/SUB-SYSTEM

POSSIBLE INTERVIE AREAS, DIMENSIONS, ISSUES AND QUESTIONS

WORK PLANNING:

Performance Appraisal

• What is the existing system of performance appraisal?• What re the components?• What are the objectives?• What is it currently being used for?• How is it linked to other systems?• What are the roles played by the system?• Are the line managers taking it seriously? Are they trained for and are they constantlykept educated?



• What are the strengths, Weaknesses and suggestions for improvement?

DEVELOPMENTSYSTEM:

Training and Learning

• What are the suggestions for improvement in the training?

• What is the training budget?

• Do line managers take the training seriously?

• What is the process of sponsoring employees for training?

• What are the other learning mechanisms being used for competency building?

• What are the new learning mechanisms that can be used?

• What are the attitudes of the line managers and the top management for training?

• What are the strengths and Weaknesses of the training as it is being managed?



WHAT TO OBSERVE IN AUDITINHRD SYSTEMTWO EXAMPLES:

HRD SYSTEM/SUB-SYSTEM SECONDARY DATA

WORK PLANNING:

PERFORMANCE APPRAISAL

Study the pattern of ratings for leniency, rater wise trends and department-wise trends toascertain the leniency and conservativeness in assessment. Study interdepartmental

variations in ratings and rewards to ascertain the possible biases, etc.. Investigate this,only if necessary.

DEVELOPING SYSTEM:

TRAINING AND LEARNING

Assess the expenditure on training level-wise, department-wise and location-wise.Assess, if the training programmes sponsored are in line with the training needs stated inthe appraisal formats. Analyse the training budget to assess, if the budgets are preparedappropriately and if the full expenditure is taken into consideration in the assessment.

WRITING H.R.AUDIT REPORT

OBJECTIVE:

1. TO HIGHLIGHT AREAS THAT NEEDS IMPROVEMENT.2. TO BE ACTED UPON.

PURPOSE:

TO HELP THE TOP MANAGEMENT AND AND THE HRD STAFF TO RECOGNISEAND RETAIN THE COMPANY’S STRENGTHS.



POINTS TO REMEMBER FOR WRITING REPORT:

A. SIMPLE LANGUARE SHOULD BE USED.B. IT SHOULD BE SHORT AND PRECISE.

C. BULLET FORM HIGHLIGHTING THE STRENGTHS ANDWEAKNESSES,SHOULD BE USED.

MODEL OUTLINE: HR AUDIT REPORT

EXECUTIVE SUMMARY

CHAPTER-1 INTRODUCTIONCHAPTER-2 CURRENT STATUS OF THE HRD FUNCTION; SOME FACTS.

CHAPTER-3 GENERAL OBSERVATIONSCHAPTER-4 CAREER SYSTEMSCHAPTER-5 WORK PLANNINGCHAPTER-6 DEVELOPMENT SYSTEMCHAPTER-7 SELF-RENEWAL SYSTEMCHAPTER-8 HRD CULTURECHAPTER-9 HRD FUNCTION

TABLE AND APPENDICES

1. INTRODUCTION

BRIEF DESCRIPTION ABOUT:

• COMPANY LOCATIONS,PRODUCTS AND SERVICES,MANPOWER, TURN OVER, ANDMAIN CONCERNS AND TOP MANAGEMENT.• DATE AND REASON FOR UNDERTAKING THE AUDIT.• METHODOLOGY ADOPTED FOR THE STUDY:DETAXILS OF SAMPLES, ANDAUDIT METHODS USED:* Questionnaires administered,* Number of individual interviews,* level-wise records and reports examined,* Group Interviews, etc..• HRD SYSTEMS (various sub-systems of HR audit; etc.)



***** __________________________________________________ ___________________

2. CURRENT STATUS OF THE HRD FUNCTION

DETAILS ABOUT HRD FUNCTIONS:

• STRUCTURE AND STAFFING OF HRD FUNCTION,• HRD DEPARTMENT’s THRUST AREAS AND OBJECTIVES,• HIGHLIGHTS OF EXISTING HRD SYSTEMS AND SUB-SYSTEMS:- Performance Appraisal,- Potential Appraisal,- Career Planning,

- Mentoring,- Training,- Job rotation,- Quality circles, etc.• STRENGTHS AND WEAKNESSES OF THE HRD FUNCTION.• HRD NEEDS: AN OVERVIEW – Broad highlights of the areas that need attention.*****

3. GENERAL OBSERVATIONS

SALIENT FESTURES OF THE COMPANY OBSERVED BY THE AUDITORS VIS-À-VIS PRESENT COMPETENCIES AND FUTURE POTENTIAL, ENCOMPASSINGFOLLOWING DIMENTIONS OF HRD:

* Competence Building,* Culture Building,* Commitment Building.

• PRESENT AND FUTURE BUSINESS CONCERNS - HIGHLIGHTS,• CONPETENCIES AND COMPETENCY REQUIREMENTS FOR FUTURE,• GENERAL OBSERVATIONS ABOUT COMPETENCIES FOUND.• GENERAL OBSERVATIONS ABOUT THE COMPETENCY PROMOTINGMECHANISMS,• COMMITMENT AND MOTIVATIONAL PATTERNS,• COMMITMENT-AND MOTIVATION-PROMOTING MECHANISMS,• WORK CULTURE AND ORGANISATIONAL CULRURE,• CULTURE-BUILDING MECHANISMS

- A BRIEF ABOUT IMPORTANCE OF THE ABOVE 3 COMPONENTS FOLLOWED



BY GENERAL STRENGTHS AND WEAKNESSES OF THE COMPANY RELATINGTO HR AREAS, COVERING THE FOLLOWING, CAN BE GIVEN:

* Impact of existing situation in the industry on HRD Cultureof the organisation; Technological Innovations, Customers

expectations, Leadership change or change of Management or any thing affecting HR function.* Any excellent or weak parts of the HRD function.* The general Strengths and Weaknesses of the Company.

***** __________________________________________________ _____________________

4. CAREER SYSTEMS

FINDINGS OF THE AUDIT ON THE FOLLOWING SHOULD BE INCLUDED:

• IMPORTANCE OF THE FOLLOWING,• MANPOWER PLANNINGF AND UTILISATION- Strengths, Weaknesses and Recommendations.

• RECRUITMENT – - Strengths, Weaknesses and Recommendations.• POTENTIAL APPRAISAL AND FAST TRACK - Strengths, Weaknesses and Recommendations.• CAREER PLANNING AND DEVELOPMENT- Strengths, Weaknesses and Recommendations.• SUCCESSIONAL PLANNING- Strengths, Weaknesses and Recommendations.*****

5. WORK PLANNING

• INTRODUCTION (Concept of work planning andthe component of systems)• CONTEXTUAL ANALYSIS _ Strengths, Weaknesses and Recommendations.• ROLE CLARITY _ Strengths, Weaknesses and Recommendations.• PERFORMANCE APPRAISAL SYSTEM _ Strengths, Weaknesses and Recommendations.



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6. DEVELOPMENT SYSTEM

• INTRODUCTION AND COMPONENTS• INDUCTION TRAINING _ Strengths, Weaknesses and Recommendations.• TRAININGAND LEARNING SYSTEMS _ Strengths, Weaknesses and Recommendations.• PERFORMANCE GUIDANCE AND DEVELOPMENT _ Strengths, Weaknesses and Recommendations.

• WORKER DEVELOPMENT _ Strengths, Weaknesses and Recommendations.• OTHER MECHANISMS OF DEVELOPMENT _ Strengths, Weaknesses and Recommendations.

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7. SELF-REENEWAL SYSTEM

• INTRODUCTION• ROLE EFFICACY _ Strengths, Weaknesses and Recommendations.• ORGANISATION DEVELOPMENT _ Strengths, Weaknesses and Recommendations.• ACTION ORIENTED RESEARCH _ Strengths, Weaknesses and Recommendations.

8. HRD CULTURE

• INTRODUCTION• HRD CULTURE _ Strengths, Weaknesses and Recommendations.• VALUES _ Strengths, Weaknesses and Recommendations.



• QUALITY ORIENTATION _ Strengths, Weaknesses and Recommendations.• REWARDS AND RECOGNITION _ Strengths, Weaknesses and Recommendations.• INFORMATION

_ Strengths, Weaknesses and Recommendations.• COMMUNICATION _ Strengths, Weaknesses and Recommendations.• EMPOWERMENT THROUGH PARTICIPATION,DECENTRALISATION, SHOPFLOOR COMMITTEES, ETC. _ Strengths, Weaknesses and Recommendations.

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9. HRD FUNCTION

• GENERAL OBSERVATIONS• INDUSTRIAL RELATIONS AND HR _ Strengths, Weaknesses and Recommendations.• PERSONNEL POLICIES AND HRD _ Strengths, Weaknesses and Recommendations.• HRD FUCTION – STRUCTURE _ Strengths, Weaknesses and Recommendations.• HRD DEPARTMENT - COMPETENCIES _ Strengths, Weaknesses and Recommendations.• HRD STRATEGIES _ Strengths, Weaknesses and Recommendations.• HRD ACTIVITIES AND PRIORITIES _ Strengths, Weaknesses and Recommendations.

HR Audit Notes

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