MU0013-SET1

Sikkim Manipal University - MBA - MU0013– Human Resource Audit

Semester: 3 - Assignment Set: 1

Q.1 Discuss the conceptualizing of HR Audit.

Conceptualization of HR Auditing

Auditing has evolved, becoming increasingly speciÞc, until the term functional audit has emerged. The objective of a functional audit is to diagnose, analyze, control, and advise within the boundaries of each functional area of the company.

The HR audit is a type of functional audit. Thus, as a Þrst approach, one could say that HR auditing consists of diagnosing, analyzing, evaluating, and assessing future lines of action within the framework of HRM. HR auditing is a basic tool for the management of a company. Its objective is not only the control and quantifying of results, but also the adoption of a wider perspective that will aid in deÞning future lines of action in the HRM Þeld. Thus, HR auditing must perform two basic functions [Cantera, 1995]. First, it must be a management information system whose feedback provides information about the situation in order to facilitate the development of managing processes or the development of HR. On the other hand, it must be a way of controlling and evaluating the policies that are being applied, as well as the established processes.

It can be understood that in order to secure the operative efficiency and user or client satisfaction, an appraisal of the results of the HR function is necessary. According to this approach, the results obtained can be valued from certain HR policies (an external type of measurement), or from the results of the policies or the policies themselves. The results can be valued through their cost (a measurement internal to the function) [Walker, 1998]. This would lead the company to consider some basic questions. Are adequate HR policies being developed? Are the desired results being obtained? To what extent do they add value to the company? The purpose of this work is to offer a few guidelines for the appraisal of the HR function, which is in itself the basis for the auditing process. The objective is to set conceptual limits for its content and to present the different approaches with which the HR audit can be presented.

Approaches to HR Auditing

HR auditing has evolved in recent years to the point that it has ceased to be a mere instrument of control and has become a necessary decision making tool in personnel related matters according to the global objectives of the company. As a result, all of the functions and competencies of HR auditing are being progressively expanded. This is creating a distinction between its component elements and the different types of HR audits. In this way, Walker [1998] differentiates between two approaches relative to HR auditing: those centered in the

Function’s internal aspect, and those centered on the external aspect. From an internal perspective, as in any staff function, there is a trend of valuing its actions as a result of the activities undertaken and its costs. In this way, the department. Capability would be judged on its ability to supply certain services to the organization at the lowest possible cost. Under this approach, the operational measurements traditionally used are those which refer to quantity, quality and reliability, or cost and speed, therefore placing the focus on activities, costs, or productivity ratios.

From an external perspective, if it is understood that the ultimate appraisal of the effectiveness of HR is based on their impact on the company’s results, then the measurements should include results obtained outside the function.



Another well-known classification of HR audit approaches, which is used to structure the present work, is the difference between three focuses, which are the legal audit of performance or conformity, the operative or efficacy-based audit, and the strategically audit.

The Legal Approach in HR Auditing

This best concept of HR auditing is based on a legal outlook. According to Antona [1993, p. 2], the audit of performance or conformity consists of .making an inventory of the social situation of the company, considering the labor law norms and regularly verifying the company’s compliance with the applicable regulations.. Thus, this concept is centered on the verification that the current labor laws are being fulfilled. The audit should verify if the firm’s policies, practices, and documents regarding employee hiring, retention, discipline, termination, and post-employment are both fair and legal [Higgins, 1997]. These practices and policies must: prohibit discrimination by offering equal employment opportunities; protect the employment seeker from being discriminated against on the basis of age; carry out minimum wages; and contain provisions regarding mental disabilities and reasonable accommodations for disabled workers.

According to Nevado [1998, p. 49], the basic functions of the audit of conformity or of performance as an element of HR auditing are threefold. The best function is examining to see if the firm is fulfilling all its administrative social obligations, as well as those relative to the collective rights of its personnel. The second is to study the relationship between the employees and the firm based on the legal statutes. The final function is verifying if the firm fulfill its financial obligations (for example, social security payments), as well as its informative ones.

Concern about labor risks has created a function within HRM with the purpose of altering working conditions by identifying the risks that could stem from them and implementing necessary preventive measures. Such preventive activity could but perfectly into the legal approach of HR, although the effort that the company can make in this sense can go beyond.

the application of the existing risk prevention laws. The requirement for labor security and hygiene is a part of the search for quality of life in the workplace, which is becoming increasingly demanded from companies.

Focus of the Function Audit

The function audit centers on .observing if the procedures applied are the adequate ones and if they function correctly. That is, checking to see if the relationship between objectives and procedures is a satisfactory one and if this has been achieved in the most cost effective manner. [Nevado, 1998, p. 50]. The function of this level of the HR audit is to study and analyze each one of the speciÞc areas of HRM. The analysis should center on the planned measures, the method of implementation, and the results obtained. In order to carry this out, the areas that are to be studied must Þrst be identiÞed. Afterwards, a list of the indicators that will serve to analyze each of them must be made. These indicators can be either quantitatively (absolute numbers or ratios) or qualitatively derived from the responses given by the people involved (management, employees, or external experts). A list of the indicators corresponding to the different areas of the HR function could contain some of the following.

1) Description of the Company.s Staff. The complete staff can be described by: hierarchic levels, years of service, qualiÞcation, sex, and nationality; the number of permanent and temporary employees, interns, and physically or mentally challenged employees; and indexes of personnel rotation and absenteeism.

2) Job Analysis:



Job analysis can include: the number of described posts and occupants per post; the degree to which the job description cards have been updated; the degree of detail in the job description cards; and the methods used to analyze and describe the jobs.

3) HR Planning:Planning includes the methods employed to plan personnel needs, the measures adopted to cover future personnel needs, and the temporary planning horizon.

4) Recruiting and Personnel Selection: This includes: the number of days needed to fill a vacant post; the number of applications received by work place categories; the average amount of days between the reception of the application and the Þnal answer; the average cost of recruitment and 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; a study of the reliability and validity of the selection tests; and the degree to which the recruiting efforts but the company’s business plan.

5) TrainingThe training indicators are: the procedures followed and the frequency with which personnel training needs are analyzed; the criteria followed to developed the content of the training programs; the evaluation criteria of the efficacy of the training programs; the percentage of the HR budget dedicated to training; the average number of hours of training per employee; and the percentage of employees that participate in training programs by work place categories.

6) Development of Professional Careers:These indicators include: the percentage of people promoted per number of employees; the percentage of vacancies covered internally and externally; and the average time per employee it takes to receive a promotion.

7) RetributionRetribution can be measured by: the average wage per employee and wage difference among employees; the Axed and variable components of retribution; the percentage of remuneration linked to the employee’s yield; and the internal equity and external competitiveness of the retribution system.

8) Performance EvaluationEvaluation indicators include: the level of usage for promotion or career; the level of feedback of results to the company’s personnel; and the degree to which poorly performing employees are assisted in improving their performance.

9) Work ConditionsWork conditions can be assessed by the frequency and index of the graveness of work- related accidents and by the labor accident and sickness prevention policies that are in place

Q.2 What are the goals of HR Audit.

GOALS OF THE AUDIT

An audit is a means by which an organization can measure where it currently stands and determine what it has to accomplish to improve its human resources function. HR audit also helps companies to figure out any gaps or lapses and the reason for the same. The goals of the audit can be of two types



i.e. short-term or long-term. Short-term goal can solve any recent problems in the organization and long-term goals are the objectives that have greater impact on the goodwill of the organization. Read box 4.1 for understanding the concept of long- and short-term audit goals through example.

Example of short-term and long-term audit goal: Suppose in a steel plant, many workers are leaving because of safety issues. So the senior HR manager decides to verify the safety and health issues in the factory. So in this case short-term goal is to solve the problem and try to retain the workers. Long-term goal is to increase the job-satisfaction among workers and increase the goodwill of the company as a better employer.

The main goal of the HR Audit is to ensure that proper controls, policies and procedures are in place for each of HR functions, and that records, disclosures, and other information are consistent with plan documents and in compliance with applicable laws and regulation. The other important goals can be as follows: 1. To ensure effective utilization of human resources. 2. To review compliance with tons of laws and regulations. 3. To motivate human resource department that it is well-managed and prepared to meet potential challenges and opportunities. 4. To maintain or enhance the organization's reputation in the society.

Q.3 What are the different types of interview?

Types of Interviews

All job interviews have the same objective, but employers reach that objective in a variety of ways. You might enter the room expecting to tell stories about your professional successes and instead find yourself selling the interviewer a bridge or editing code at a computer. One strategy for performing your best during an interview is to know the rules of the particular game you are playing when you walk through the door.

The Screening Interview



Companies use screening tools to ensure that candidates meet minimum qualification requirements. Computer programs are among the tools used to weed out unqualified candidates. (This is why you need a digital resume that is screening-friendly. See our resume center for help.) Sometimes human professionals are the gatekeepers. Screening interviewers often have honed skills to determine whether there is anything that might disqualify you for the position. Remember-they do not need to know whether you are the best fit for the position, only whether you are not a match. For this reason, screeners tend to dig for dirt. Screeners will hone in on gaps in your employment history or pieces of information that look inconsistent. They also will want to know from the outset whether you will be too expensive for the company.

Some tips for maintaining confidence during screening interviews:

Highlight your accomplishments and qualifications. Get into the straightforward groove. Personality is not as important to the screener as verifying

your qualifications. Answer questions directly and succinctly. Save your winning personality for the person making hiring decisions!

Be tactful about addressing income requirements. Give a range, and try to avoid giving specifics by replying, "I would be willing to consider your best offer."

If the interview is conducted by phone, it is helpful to have note cards with your vital information sitting next to the phone. That way, whether the interviewer catches you sleeping or vacuuming the floor, you will be able to switch gears quickly.

The Informational Interview

On the opposite end of the stress spectrum from screening interviews is the informational interview. A meeting that you initiate, the informational interview is underutilized by job-seekers who might otherwise consider themselves savvy to the merits of networking. Job seekers ostensibly secure informational meetings in order to seek the advice of someone in their current or desired field as well as to gain further references to people who can lend insight. Employers that like to stay apprised of available talent even when they do not have current job openings, are often open to informational interviews, especially if they like to share their knowledge, feel flattered by your interest, or esteem the mutual friend that connected you to them. During an informational interview, the jobseeker and employer exchange information and get to know one another better without reference to a specific job opening.

This takes off some of the performance pressure, but be intentional nonetheless:

Come prepared with thoughtful questions about the field and the company. Gain references to other people and make sure that the interviewer would be comfortable if you

contact other people and use his or her name.

Give the interviewer your card, contact information and resume.

Write a thank you note to the interviewer.

The Directive Style

In this style of interview, the interviewer has a clear agenda that he or she follows unflinchingly. Sometimes companies use this rigid format to ensure parity between interviews; when interviewers ask each candidate the same series of questions, they can more readily compare the results. Directive interviewers rely upon their own questions and methods to tease from you what they wish to know. You might feel like you are being steam-rolled, or you might find the conversation develops naturally. Their style does not necessarily mean that they have dominance issues, although you should keep an eye



open for these if the interviewer would be your supervisor.

Either way, remember:

Flex with the interviewer, following his or her lead. Do not relinquish complete control of the interview. If the interviewer does not ask you for

information that you think is important to proving your superiority as a candidate, politely interject it.

The Meandering Style

This interview type, usually used by inexperienced interviewers, relies on you to lead the discussion. It might begin with a statement like "tell me about yourself," which you can use to your advantage. The interviewer might ask you another broad, open-ended question before falling into silence. This interview style allows you tactfully to guide the discussion in a way that best serves you.

The following strategies, which are helpful for any interview, are particularly important when interviewers use a non-directive approach:

Come to the interview prepared with highlights and anecdotes of your skills, qualities and experiences. Do not rely on the interviewer to spark your memory-jot down some notes that you can reference throughout the interview.

Remain alert to the interviewer. Even if you feel like you can take the driver's seat and go in any direction you wish, remain respectful of the interviewer's role. If he or she becomes more directive during the interview, adjust.

Ask well-placed questions. Although the open format allows you significantly to shape the interview, running with your own agenda and dominating the conversation means that you run the risk of missing important information about the company and its needs.

The Stress Interview

Astounding as this is, the Greek hazing system has made its way into professional interviews. Either employers view the stress interview as a legitimate way of determining candidates' aptness for a position or someone has latent maniacal tendencies. You might be held in the waiting room for an hour before the interviewer greets you. You might face long silences or cold stares. The interviewer might openly challenge your believes or judgment. You might be called upon to perform an impossible task on the fly-like convincing the interviewer to exchange shoes with you. Insults and miscommunication are common. All this is designed to see whether you have the mettle to withstand the company culture, the clients or other potential stress.

Besides wearing a strong anti-per spirant, you will do well to:

Remember that this is a game. It is not personal. View it as the surreal interaction that it is. Prepare and memorize your main message before walking through the door. If you are flustered,

you will better maintain clarity of mind if you do not have to wing your responses.

Even if the interviewer is rude, remain calm and tactful.

Go into the interview relaxed and rested. If you go into it feeling stressed, you will have a more difficult time keeping a cool perspective.

The Behavioral Interview



Many companies increasingly rely on behavior interviews since they use your previous behavior to indicate your future performance. In these interviews, employers use standardized methods to mine information relevant to your competency in a particular area or position. Depending upon the responsibilities of the job and the working environment, you might be asked to describe a time that required problem-solving skills, adaptability, leadership, conflict resolution, multi-tasking, initiative or stress management. You will be asked how you dealt with the situations.

Your responses require not only reflection, but also organization. To maximize your responses in the behavioral format:

Anticipate the transferable skills and personal qualities that are required for the job. Review your resume. Any of the qualities and skills you have included in your resume are fair

game for an interviewer to press.

Reflect on your own professional, volunteer, educational and personal experience to develop brief stories that highlight these skills and qualities in you. You should have a story for each of the competencies on your resume as well as those you anticipate the job requires.

Prepare stories by identifying the context, logically highlighting your actions in the situation, and identifying the results of your actions. Keep your responses concise and present them in less than two minutes.

The Audition

For some positions, such as computer programmers or trainers, companies want to see you in action before they make their decision. For this reason, they might take you through a simulation or brief exercise in order to evaluate your skills. An audition can be enormously useful to you as well, since it allows you to demonstrate your abilities in interactive ways that are likely familiar to you. The simulations and exercises should also give you a simplified sense of what the job would be like. If you sense that other candidates have an edge on you in terms of experience or other qualifications, requesting an audition can help level the playing field.

To maximize on auditions, remember to:

Clearly understand the instructions and expectations for the exercise. Communication is half the battle in real life, and you should demonstrate to the prospective employer that you make the effort to do things right the first time by minimizing confusion.

Treat the situation as if you are a professional with responsibility for the task laid before you. Take ownership of your work.

Brush up on your skills before an interview if you think they might be tested.

The Group Interview

Interviewing simultaneously with other candidates can be disconcerting, but it provides the company with a sense of your leadership potential and style. The group interview helps the company get a glimpse of how you interact with peers-are you timid or bossy, are you attentive or do you seek attention, do others turn to you instinctively, or do you compete for authority? The interviewer also wants to view what your tools of persuasion are: do you use argumentation and careful reasoning to gain support or do you divide and conquer? The interviewer might call on you to discuss an issue with the other candidates, solve a problem collectively, or discuss your peculiar qualifications in front of the other candidates.

This environment might seem overwhelming or hard to control, but there are a few tips that will help you navigate the group interview successfully:



Observe to determine the dynamics the interviewer establishes and try to discern the rules of the game. If you are unsure of what is expected from you, ask for clarification from the interviewer.

Treat others with respect while exerting influence over others.

Avoid overt power conflicts, which will make you look uncooperative and immature.

Keep an eye on the interviewer throughout the process so that you do not miss important cues.

The Tag-Team Interview

Expecting to meet with Ms. Glenn, you might find yourself in a room with four other people: Ms. Glenn, two of her staff, and the Sales Director. Companies often want to gain the insights of various people when interviewing candidates. This method of interviewing is often attractive for companies that rely heavily on team cooperation. Not only does the company want to know whether your skills balance that of the company, but also whether you can get along with the other workers. In some companies, multiple people will interview you simultaneously. In other companies, you will proceed through a series of one-on-one interviews.

The Mealtime Interview

For many, interviewing over a meal sounds like a professional and digestive catastrophe in the making. If you have difficulty chewing gum while walking, this could be a challenge. With some preparation and psychological readjustment, you can enjoy the process. Meals often have a cementing social effect-breaking bread together tends to facilitate deals, marriages, friendships, and religious communion. Mealtime interviews rely on this logic, and expand it.

Particularly when your job requires interpersonal acuity, companies want to know what you are like in a social setting. Are you relaxed and charming or awkward and evasive? Companies want to observe not only how you handle a fork, but also how you treat your host, any other guests, and the serving staff.

Some basic social tips help ease the complexity of mixing food with business:

Take cues from your interviewer, remembering that you are the guest. Do not sit down until your host does. Order something slightly less extravagant than your interviewer. If he badly wants you to try a particular dish, oblige him. If he recommends an appetizer to you, he likely intends to order one himself. Do not begin eating until he does. If he orders coffee and dessert, do not leave him eating alone.

If your interviewer wants to talk business, do so. If she and the other guests discuss their upcoming travel plans or their families, do not launch into business.

Try to set aside dietary restrictions and preferences. Remember, the interviewer is your host. It is rude to be finicky unless you absolutely must. If you must, be as tactful as you can. Avoid phrases like: "I do not eat mammals," or "Shrimp makes my eyes swell and water."

Choose manageable food items, if possible. Avoid barbeque ribs and spaghetti.

Find a discrete way to check your teeth after eating. Excuse yourself from the table for a moment.

Practice eating and discussing something important simultaneously.

Thank your interviewer for the meal.

The Follow-up Interview



Companies bring candidates back for second and sometimes third or fourth interviews for a number of reasons. Sometimes they just want to confirm that you are the amazing worker they first thought you to be. Sometimes they are having difficulty deciding between a short-list of candidates. Other times, the interviewer's supervisor or other decision makers in the company want to gain a sense of you before signing a hiring decision.

The second interview could go in a variety of directions, and you must prepare for each of them. When meeting with the same person again, you do not need to be as assertive in your communication of your skills. You can focus on cementing rapport, understanding where the company is going and how your skills mesh with the company vision and culture. Still, the interviewer should view you as the answer to their needs. You might find yourself negotiating a compensation package. Alternatively, you might find that you are starting from the beginning with a new person.

Q.4 Explain compensation system.

Compensation System

Employee compensation system along with the benefits programs, are one of the most complex HR systems. A reward system should help support the organization's strategic mission, motivate employees, and reward performance. Compensation systems should be both externally competitive and internally equitable. Auditors may want to work with a compensation expert when reviewing this area. A review of the organization's salary administration process is also important to determine how employees are paid throughout their careers, including merit increases, variable performance pay, promotions, bonuses, stock options, and deferred compensation, to name a few.

Base salary

During the audit, auditors should ensure that: a compensation philosophy has been developed that defines how the organization wants to pay people with respect to its position in the labor market; there are current job descriptions for each position; an effective market analysis has been conducted; a salary structure has been developed to help manage pay, and an appropriate job evaluation system is being used to slot jobs into the salary structure. Auditors should verify controls to ensure that the confidentiality of personnel data is maintained, additions to base pay are appropriately calculated and authorized, full compliance with tax and other deductions is made, terminating employees' payrolls are processed appropriately, and payroll costs are in line with budgeting objectives.

Sales incentives

Sometimes past incentive programme may be a reason for disappointment to both you and your salespeople. At the time of HR audit, sales incentive programme should be crosschecked because a payment less than the worth may lead the sales team to underperform or fail as a result. Corporations use incentive programs to drive behavior and it is a well known fact that what gets rewarded gets done. To ensure that the incentive programme at your organization work, you may use.

The 80-20 principle

Twenty percent of the salespeople make eighty percent of the sales and profits. Too often, sales incentives are geared to the entire sales force. This may seem to be a fair strategy, but a strategist should remember that these 20% people are already motivated. That means that the sales incentives should be good enough to 1. keep these motivated sales personnel going and 2. light a fire under the next twenty percent – the next logical group



The results have shown that this doubles the business in a more cost efficient manner.

Keep it simple: Good salespeople look to simplicity to make things happen. Thus the organization must keep the incentive program sweet, simple and attainable. There can be no ambiguity. Anything less will result in a lack of interest, as well as a waste of time and money that can sometimes spill over into other departments whose task it is to administer and account.

Productivity incentives HR audit should employ meaningful methodologies of productivity measurement to evaluate and monitor the performance of a business operation. Productivity measurements must show a linkage with profitability and should clearly demonstrate how efficiently (or inefficiently) a company is using its resources to produce quality goods and services. The auditor should analyze if a realistic means of measuring progress has been employed or not. More importantly, he should ensure that the organization has made realistic goals and performance targets that can be reached through productivity improvements.

Executive bonus programs In most of the companies, title and seniority mean more when it comes to bonus pay. By granting bonuses according to title and seniority, companies turn them into entitlements, not incentives. Due to this, executives, who does the field work and put in more labor do not get that much of the bonus. HR auditor should ensure that the organization links incentives to performance as the only fair and rationale way to reward employees. Bonus plans by design, should be geared to reward employees for short-term performance. In implementing a bonus program, employers must first establish how the program fits into their overall compensation philosophy as well as set criteria that need to be met for the reward. There are some that believe in paying low salaries and highly aggressive incentives, while others believe the exact opposite. Regardless, the auditor should check if the executive bonus plan fits the uniqueness of the company.

Team based incentives Since in most of the big organizations, a project is assigned to a whole team together and the performance on the project depends on the collective performance of the team, the HR auditor should check if the due reward is being paid to the collective performance of the employees. There are primarily two ways to offer team based incentives, viz. 1. Team based 2. Gain sharing The auditor should also check if the employees are satisfied by the allocation method employed. The methods of team based incentive allocation are: Equal incentive payments

Differential payments based on contribution to goals

Differential payment according to base pay

Most often than not, the teams like the second one of the above methods of the incentive allocation. At the time of the audit, it should also be checked if the team is being told about the team based incentives entitled to them, and the allocation method involved or not.

Exempt and non-exempt status determination

This concept is more prominent in USA where the HR auditor should analyze if the finance department has correctly determined whether a salaried associate should be exempt or non-exempt? Exempt status is regulated by the Fair Labor Standards Act (FLSA). When determining exemptions, employers must first consider the way in which the employee is paid (hourly vs. salaried), then they must review the duties and responsibilities of the job. Although, there are a number of unique position that provide for exempt status. The majority of employers must use what is referred to as the “white-collar exemption



tests” to determine exempt status. There are four main exemptions, executive, administrative, professional, and out-side sales, that positions can be placed in based upon the duties and responsibilities of the job. The determination is never, made based upon the job‟s title or the manner the position is paid.Overtime computation

According to the labour laws in India, when a worker works in an employment for more than nine hours on any day or for more than forty-eight hours in any week, he shall, in respect of such overtime work, be entitled to wages at double the ordinary rates of wages. The labour laws also state that the workers should be given double the normal salary when they work overtime (extra hours, either on working days or weekly offs). But many a company do not do so. They might, for example, not pay the entire double amount and instead replace it with an amount that is definitely higher than the basic, but still less than the double. This will definitely create employee unrest over time and the productivity is bound to suffer. At the time of HR audit, the auditor must make sure that no such practice is being undertaken and the employees are getting their dues properly.

Q.5 Write a note on Audit of HR Function.

Audit of HR Function

The purpose of a Human Resources audit is to assess the effectiveness of the Human Resources function and to ensure regulatory compliance. The audit can be conducted by anyone with sufficient Human Resources experience. Having experience working in more than one company is a plus, as it provides the auditor with a broader perspective. There's an advantage to having the audit conducted by an external consultant. Because the external consultant has fewer biases about the organization and has less personal interest in the outcome than an employee of the company, the external consultant may be more objective.

Collect Data

Assess the mission, vision, strategy, and culture of the organization, from whatever written material there is in the company (check with the department or person who handles public, customer, or shareholder relations). Collect existing data such as:1. Hiring statistics (acceptance rate, hiring rate, hiring projections) 2. Turnover 3. Compensation and benefits philosophy and practice 4. Exit interview summaries 5. Employee complaints (discrimination, harassment, safety, other) 6. Promotion and advancement practices and trends 7. Human Resources budget and expenditures

Where possible, compare the data you collected with market data. This information will provide you with a point of view for the next phase of the audit: the interviews. If, during the interview, discrepancies arise between the data and the interviewee's answer, you can explore the reasons for the discrepancy(s).

Conduct Interviews

The purpose of the interview is to collect input from the internal customer on their Human Resources needs and how those needs are being met. Begin the interview with top management. Next conduct interviews with a sample of subordinate managers including first line management. The topics to discuss during the interview include:



1. Perceptions of the company and its goals 2. Strengths and weaknesses of top management

3. Employee perceptions of the company and top management

4. Relations with subordinates

5. Support of career goals for self and employees

6. Major Human Resources issues

7. Which Human Resources functions work well

8. Which Human Resources functions need improvement

Conduct the Regulatory Compliance Audit

The following areas should be audited as part of the regulatory compliance audit:

1. Personnel files and recordkeeping (contain only job related information) 2. Pay equity

3. Job descriptions (ADA compliance)

4. Legal postings

5. Equal Employment Opportunity and Affirmative Action

6. Forms (applications, internal forms, etc.)

7. Workers' Compensation

8. Fair Labor Standards Act

9. Family and Medical Leave Act

10. Legal reporting

Summarize the Results

Consolidate the information you collected. Compare the results with market surveys. Determine which practices are good/popular/effective/competitive. Determine which practices need improvement. Recommend specific improvements referring to the results of both the Effectiveness audit and the Regulatory compliance audit. Justify the recommendations. Determine how to measure whether the improvements are successful.

Obtain Approval from senior Management

Present the preliminary results and recommendations to senior management individually. Point out how these recommendations will support their needs. Obtain their support, then present the final results and recommendations to the senior management staff for final approval.

Implement the Program



Consider implementing the program in part of the organization as a pilot program. Monitor and measure success and seek to continuously improve processes. Be prepared to modify the program if an organizational change requires it.

Q. 6 Write a note on design and implementation of competencies model.

Design and Implementation of competencies model

During an HR audit, due attention must be paid to find out if the competencies model has been adequately designed and developed or not. There are three ways in which competencies models may be developed:

1. Behavioral Indicators: Behavioral indicators describe the behaviors, thought patterns, abilities and traits that contribute to superior performance.

2. Evaluative Competency Levels: Exceptional competencies of high performers are set as

standards for evaluating competency levels of employees.

3. Competencies Describing Job Requirements: This approach is useful for organizations having multiple competency models. Competencies required in a particular job are described. Job specific competency models help in structuring focused appraisal and compensation decisions.

To identify role-specific competencies required industry specific, functional and behavioral competencies, which need to be developed for enhanced performance. The approach for developing a competency framework for a particular role is as proposed below:

Understand strategic business context of the organizations in term of its structure and environmental variables.

Detail role description for positions. Defining and scaling (relative importance and mastery level) of specific behaviors for each identified competency as a measure of performance.

Develop competency framework taking into consideration the core values and the culture of the organizations in addition to specific functional and level requirements. This should gel with the vision and mission of the company.

Validate the competency framework through a workshop, which should include functional experts and top management personnel in order to define critical and desirable competencies. And also to substantiate the extent to which the competencies differentiate between high and average performers by validating the content and criteria.

The auditor should establish the link between people and roles through effective measuring tools that evaluate the performance of the person in the HR Audit role.



On-the-job performance of the individual is evaluated on the basis of a performance management system. The assessment centre is a powerful tool in the hands of the management for selection and development. As a selection tool it can be used for management promotions, fast tracks schemes, high potential list and change of functional role. As a development tool, it is helpful in succession planning, identifying training needs and career development. Designing and conducting a potential assessment centre should follow basic principles in term of accuracy, fairness, reliability, legality, efficiency, multiple assessors, multiple tests and optimal stress to increase performance. It would involve two types of exercises, i.e., group exercises and individual exercises.

Group Exercises For potential assessment, the following group exercises are conducted: Assigned Role Exercises: Used to assess negotiating skills, decision making skills, and risk taking skills;

Unassigned Role Exercises: Used to assess ability to handle uncertainty, change orientation, ethical behavior and global orientation; and

Team Exercises: Used to assess ability to work in a team and solve problems efficiently.

Individual Exercises

For potential assessment, the following individual exercises are conducted: In-Basket Exercises: Used to assess ability to plan, organize, decide, manage and delegate;

Learning skill Inventory/Psychometric Inventories: Used to assess ability to learn, leverage knowledge and indicate behavioral patterns; and

Interpersonal Effectiveness Module: Used to assess interpersonal effectiveness, excommunication skills, patience and interpersonal skills.

Inputs for analysis of an individual’s potential and behavioral patterns are also collected through multilateral feedback, behavioral event interviews, career aspiration interview, career history, etc. In order to minimize assessors’ bias and ensure objectivity and uniformity multiple trained assessors for each competencies assessment are used.

Documents

MU0013-SET1