Hra

SOLUTION TO ASSIGNMENT

Question 1. Define Human Resource (HR) Audit. Explain the need for HR Audit. What are the benefits of HR Audit?

Answer.

1. HR Audit. “A human resource audit is defined as an investigative, analytical and comparative process that attempts to reflect the effectiveness of the human resource function.”- Jack J. Phillips. It is a comprehensive method of objective and systematic verification of current practices, documentation, policies and procedures prevalent in the HR system of the organization.

2. Need for HR Audit. Conducting HR audits is an integral part of an an HR professional’s role in any company. Not only will an HR audit help a company ensure it’s in compliance and conformance with the law, but it will help HR professionals standardise processes, identify risk areas, and tie HR goals to strategic business goals. An audit assists the organization by:-

(a) Identify strengths that are efficient, effective and need to be retained and improved.

(b) Improve HRD for growth, diversification and entering into a fast-growth phase.

(c) Identify problem areas which need to be eliminated.

(d) Evaluate that the HR practices are aligned to the goals of the organization.

(e) Identify inputs required to develop an optimal HR strategy.

(f) Identify whether the organization is at risk due to non-compliance with relevant workplace legislations.

(g) Determine change of leadership.

(h) Promote professionalism among employees and to switch over to professional management.

3. Benefits. The audit helps clarify the department’s role and leads to greater uniformity, especially in the geographically scattered and decentralized HR function of large organisations. HR audit helps in analyzing the gap between ‘what is the current HR function’ and ‘what should be/could be the best possible HR function’ in the organization. The benefits associated with Human Resource audit are listed below:-

(a) Identifies the contribution of Human Resource department to the organization

(b) Improves the professional image of the Human Resource department.

(c) Reduces human resource cost through more effective Human Resource procedure.

(d) Helps motivate HR persons to improve by evaluating their performance.

(e) Encourages greater responsibility and professionalism among member of the Human Resource department.

(f) Improves performance appraisal systems.

(g) Clarifies the HR department’s duties and responsibilities.

(h) Stimulates uniformity of HR policies and practices.

(i) Finds critical HR problems and solve them efficiently.

(j) Ensures timely compliance with legal requirements.

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(k) Creates increased acceptance of needed change in the Human Resource department.

(l) Requires thorough review of Human Resource department’s information system.

(m) Helps to pursue systematic job analysis.

Question 2. Write short notes on:

(i) Audit of HR Planning

(ii) Audit of Industrial Relations

Answer.

1. Audit of HR Planning. It is the process that aligns the strategic plan to ensure that staffing is sufficient, qualified, and competent in keeping with the organization's objectives. Such planning achieves optimum use of an organisation's human resources. The objective of HR planning is to ensure the best man is available for the job, while avoiding manpower shortages or surpluses.

(a) 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. 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:

(i) How to develop and introduce an effective HR planning system.

(ii) How to estimate workforce requirements for the organisation.

(iii) Understanding and predicting the available labour supply.

(iv) How to analyse the supply and demand balance, and deal with a surplus or a shortfall.

(v) Handling the implications for recruitment, internal redeployment, pay and rewards, training and development, and employee retention.

(vi) Monitoring organisational plans, i.e., how to develop a system that will give you reliable early warnings of problems ahead.

(b) The audit of HR planning helps to verify the following specific aspects of HR planning:-

(i) An organisation’s future plans for expansion, diversification, technological change, etc., should be backed by the availability of suitable human resources.

(ii) There must be flexibility in the plan during uncertainity and change management when the expected manpower is not available.

(iii) Advancement and development of employees through training, development, etc.

(iv) The plan to cater for the individual needs of the employees for carer advancement including promotions, transfers, salary enhancement, better benefits, etc.

(v) Anticipating the cost of salary, benefits and all the cost of human resources thus facilitating the formulation of budgets in a society.

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(vi) Redundancy and plans to change the techniques of management.

(vii) Planning for physical facilities, working conditions, the volume of fringe benefits such as canteen, schools, hospitals, conveyance, child care centres, quarters, company stores, etc.

(viii) Development of various sources of human resources to meet the organisational needs.

2. Audit of Industrial Relations. Essentially industrial relations involve efforts at arriving at answers to the conflicting objectives and values; profit motive and social gain; discipline and freedom; authority and industrial democracy; bargaining and co-operation; and conflicting interests of the individual, the group and the community. It is a term used to depict the collective relationships between the management and the workers and covers the aspects of industrial life such as trade unionism, collective bargaining, workers’ participation in management, discipline and grievance handling, industrial disputes and interpretation of labour laws and rules and code of conduct. The most important benefit of audit of industrial relations is that this ensures continuity of production, reduces industrial disputes, and ensures good industrial relations to the morale of the employees, cooperation and recognition of the employer and employeeto help in increasing production. Wastages of man, material and machines are reduced to the minimum and thus national interest is protected. Specifically auditing industrial relations often involves checking whether the following are already in place, either in written form or in custom and practice:

(a) An organisational vision, mission corporate plan or philosophy statement.

(b) A written industrial relations policy specific to the organisation.

(c) Any written industrial relations procedures specific to the organisation (for example, grievance procedure, dispute resolution procedure, staff consultation procedures, appeals procedures, etc.).

(d) A written industrial relations plan specific to the organisation.

(e) Any formal, written complaints/grievances lodged by staff.

(f) Statistical/ quantifiable analyses such as:

(i) Staff turnover rate.

(ii) Unplanned leave rate (absenteeism rate).

(iii) Average length of service per employee rate.

(iv) Workers compensation and accident/ injury rate.

(v) OH&S (occupational health and safety) compliance and incident/near-miss rate.

(vi) Productivity per employee rate.

(vii) Sales per employee rate.

Question 3. What is HR Scorecard? Explain the reasons for designing & implementing HR Scorecard framework.

Answer.

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1. HR Scorecard. The HR Scorecard is a modern HR reporting tool for measuring the progress, identifying gaps and communicating successes. It provides the almost instant and immediate feedback about the performance of HR in the organization. The HR scorecard usually measures several main areas or elements important for the entire organization:-

(a) The Workforce Element. This is about measuring the real contribution of the workforce results to the success of the organization and shows the alignment of the performance management with the business strategy.

(b) Alignment with the Business Strategy. The alignment measures the alignment of HR practices with the business strategy. It indicates the alignment of Human Resources with the basic needs of the organization.

(c) The HR Practices. This element measures the performance of the HR practices in the organization. The HR Benchmarking is quite common in this area for measuring the world-class HR practices against the performance of the main competitors.

(d) The Costs. This part of the scorecard represents the trends in real investments into the workforce. It shows healthy and unhealthy trends in the organization.

(e) HR Employees. This part of the scorecard represents the long term development of the HR team and its contribution to the overall results of the organization.

2. Reasons for Designing and Implementing HR Scorecard. The HR scorecard was essentially designed for:-

(a) Reinforcement of the Distinction between HR Do-ables and Deliverables. The HR scorecard differentiates between deliverables that influences strategy and the do-ables that do not.

(b) Controlling Cost and Value Creation. HR professionals have a dual role to cut costs and fulfil the strategic goals, so as to create value. HR professionals drive out costs and create value for the firm by retaining good human resources.

(c) Measuring Leading Indicators. For human resources departments, leading indicators are factors that measure progress toward the goals on the HR strategy map. HR Scorecard measures these indicators and provides feedback on HR’s progress towards the strategic goals.

(d) Assessment of HR Contribution to Strategy Implementation. The scorecard provides the measures which bring out the strategic rationale for solutions to business problems.

(e) Facilitating HR Managers to Manage their Strategic Responsibility. The deliverables of the scorecard provides necessary motivation to focus exactly on how their decisions shape the implementation of the business strategy.

(f) Encouraging Flexibility and Change. The scorecard with its causal emphasis and feedback loops does not allow the measurement systems to get to standardised. It thus provides the flexibility and change because it focusses on strategy implementation, which constantly demands change.

Question 4. What is meant by ‘Competency mapping? Explain the various competencies and the associated behavioural aspects.

Answer

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1. Competency Mapping. Competency mapping is a way of optimising human capital. It's about identifying a person's job skills and competencies in areas like teamwork, leadership, and decision-making. Large organizations may use some form of this technique to understand how to best use each worker or how to combine the strengths of different employees to produce the highest quality work. Individuals may also find that this type of assessment can help them prepare for a career change or advance in a specific job field.

2. Competencies and Associated Behavioural Aspects.

(a) Communication Skills. Having good communication skills in the workplace is all about being able to convey information to people clearly and simply, in a way that means things are understood and get done.

Competency Behavioural Aspects

Communication Skills Ability to express thoughts clearly

Ability to make others understand

Ability to listen

Ability to express thoughts in writing

Ability to summarise ideas precisely

(b) Interpersonal Relationship Building Ability. This relates to the ability to socialise and bond with others.


Interpersonal Relationship Building Ability

Ability to work in groups or teams

Ability to initiate talks

Ability to understand other’s problems

Ability to empathise

Moral courage

(c) Negotiating Ability. Negotiation is a method by which people settle differences. It is a process by which compromise or agreement is reached while avoiding argument and dispute.


Negotiating Ability Ability to reason and think logically

Ability to be ethical

Ability to predict the next argument

Ability to survive and not surrender

(d)

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(e) Critical Thinking Ability. This assists in acting under unforeseen and critical situations.


Critical Thinking Ability Ability to think logically under stress

Ability to remain confident under critical situations

Ability to take risk

Ability to take responsibility when something goes wrong

(f) Data Management Ability. The data and files need to be managed effectively


Data Management Ability Ability to receive correct data

Ability to transmit accurate data

Ability to store data in order and safely

Ability to understand how much of data is to be revealed to a person

(g) Forecasting Ability. This is the ability to see the future changes in an uncertain business environment.


Forecasting Ability Constant review of business environment

Updating oneself on global business happenings

Adequate logic and reasoning

(h) Creativity. The ability to think out of the box and produce different products from the competitors and make them useful for the target population.


Creativity Ability to think differently

A keen sense of colours

Ability to present differently

Courage to accept and present ideas

(i) Business Environmental Understanding.


Business environment understanding

Regular scanning of the business environment

Understanding the happenings in the global business environment

Proper understanding of the happenings within the organisation

Ability to relate the happenings in the outside world to the business

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(j) Coordination/ Partnership Skills. This enables people of one department to coordinate and work with people of other department. Also people of the same department must be able to coordinate among themselves and also with the external environment.


Coordination/ Partnership Skills

Ability to work in teams

Knowledge about the activities of other departments

Ability to receive and transfer information

(k) Instruction Following Ability. Employees must be able to receive orders from their superiors and execute the instructions correctly.


Instruction following ability Ability to listen keenly to the instructions given

Ability to accept instructions

Ability to be oriented towards the target

Ability to retain interest in the work being done.

Ability to build trust in the minds of superior about the quality of work one does

(l) Knowledge Updating. It is mandatory in a business environment to update his/ her knowledge with regard to the happenings in the outside world.


Knowledge Updating Ability to scan external environment

Ability to search for information

Ability to logically relate the information obtained

(m) Presentation Skills. Employees in any organisation will have to present their reports or analyses to people within the organisation and also to others outside.


Presentation Skills Proper body language

Ability to simplify the presentation

Ability to have a control over the audience

Ability to answer the questions asked

(n)

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(o) Analysing/Problem Solving Ability. When faced with, An employee must be able to tackle an unexpected situation and resolve any related problem.


Analysing /Problem Solving Ability

Proper body language

Ability to simplify the presentation

Ability to have a control over the audience

Ability to answer the questions asked

(p) Counselling Ability. An employee require a good counsellor who can lend their support to the employees with problems.


Counselling Ability Ability to lend an ear to the people with problems

Ability to listen without interrupting or advising

Ability to empathise with the other person

Ability to accept the person the way he/she is

Ability to have a proper body language

Question 5. Describe the effectiveness of Human Resource Development Audit as an intervention.

Answer

1. Human resources like any other resource in a business organization need to be also be exploited to their maximum potential. Sustainability and progress of business will depend on new competencies, methods, strategies and value creating processes. HRD audit plays a major role in providing these inputs by finding out the future HRD needs of the company after assessing the current HRD activities.

2. A great deal of work has been done in India regarding the use of HRD Audit as an OD intervention and is a unique feature of Indian organizations. This has shown the following results:

(a) The audit in several organizations resulted in establishing several organizational systems and processes such as potential & performance appraisal, career planning, training, mentoring,

(b) Formulation of clear cut policies including promotion policy, communication policy, reward and recognition policy, etc.

(c) Helped in developing trust, collaboration, team work, Human Orientation gets injected into the business process with opportunities for growth and development provided to all employees

(d) More role clarity and direction to the employees in terms of their work leading to higher level of role efficacy.

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3. In line with the above, HRD managers in India do undertake a number of interventions, which may be classified as OD interventions. The nature of interventions undertaken by the HRD departments includes:

(a) Cultural change through new performance management systems

(b) Total Quality Management (TQM) based interventions (in most cases these are undertaken also by a separate group of professionals)

(c) Survey feedback

(d) Role clarity and role negotiation exercises

(e) Training

(f) Career planning and succession exercise

(g) Assessment centres and promotion policies

(h) Vision and value clarification exercises

(i) Performance coaching workshops

(j) Team building interventions

4. A research on assessing the effectiveness of HRD audit has shown that once the HRD audit report was submitted, the HR chief called all the managerial staff and presented the findings. Based on the discussions an action plan was drawn up, which after implementation brought about the following changes:

(a) A well-established potential appraisal system and a systematic performance appraisal system

(b) Career planning up to the executive level

(c) Role clarity brought about through identification of KPA’s

(d) Systematic induction and training program was established

(e) Initiation of mentoring

(f) An increase in the level of trust among employees

(g) High involvement of employees at all levels

(h) Human orientation injected into the business process with opportunities for growth and development provided to all employees

(i) Empowerment of operators through various mechanisms, and efforts made towards improving management-operator relationship

(j) Integration of all HR related activities, which support developmental activities

5. The above study adequately proved that HRD was very effective as an intervention.

Question 6 Describe the rationale behind human resource valuation and auditing.

Answer

1. Human Resource Valuation. Human resource valuation means the identification and measurement of the value of human resources and then supplying this information to the interesting parties. It is also defined as a method of assigning value to the employees on the basis of their future economic services to the organization. Human resource valuation is incomplete without a comprehensive audit system. In its absence the management may not realize the negative effects of any program, which may result in a falling value of human assets.

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2. Rationale. The main rationale behind human resource valuation can be understood by going through the following list:

(a) Guarantee to Customers/clients. Human resource valuation assures quality and consistency to customers.

(b) Establishing Investor Confidence. Quality of Human Capital is a key indicator of the performance of an organisation and even a minor deterioration in the quality of human asset of a service provider reflects on such performance. It is prudent to communicate to investors that their human resource is quite efficient to deliver high returns on relatively low investments so as to gain their confidence.

(c) Planning Outgo. HR valuation provides the management an assessment of the future expenditure of personnel costs for training and development, salary and benefits, compensation costs, retirement benefits etc.

(d) Monitoring Performance. HR valuation plays quite a substantial role in monitoring efficiency of personnel and in designing the HR strategy. Such a valuation tabulates a database on personnel details, which serves as a basis for MIS reports on returns on personnel cost, return on human capital, etc.

(e) Employee motivation. Human resources are perceived as assets in the balance sheet leading to a high level of motivation among the personnel associated with the organisation.

(f) Costing Exercise. HR valuation assists the management to assesses its costs related to the HR department by developing a human resource accounting system. The organisation can thus provide cost clarity to all its stakeholders in all areas related to the human resources of the company.

(g) Assessing Segment Efficiency. Human resource audit enables the appraisal of the performance of its human resources, thereby facilitating the basic function and management of human resources.

3. Hence, human resource valuation and audit activity are helpful exercises in improving the efficiency of human resources in the changing business scenario.

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