hr audit,score card, pcmm

HRD Audit

Start to End...

"The unexamined work life is not worth living."

“The things that get measured gets managed”

Socrates’ (469-399 BC)

Kaplan (2000)

What is HRD?...

Competence Building

Commitment Building

Culture Building

What ?...

An HRD Audit is like an annual health check-up, it plays a vital role in instilling a sense of confidence in the Management and the HR functions of an organisation.

What keeps you awake at night?

What is an HR audit?An HR audit is a process to

review

implementation of your institutions policies and procedures,

ensure compliance with employment law,

eliminate liabilities,

implement best practices

and educate your managers.

The audit should be:

Proactive

Reactive

Informative

Developmental

Audit Tools:• Interview(Individual and group, Top Management, Line Managers, HRD Staff, Workmen and others)

•Observations

•Document review

• Questionnaire

• Sampling

•Analysis of Reports, Records, Manuals, and other published literature

HR Audit v/s HRD Audit...

HRD Audit is evaluation of only few activities :-

• Strategies, • Structure, • Systems, • Styles• Skills & Competencies• Culture

HR Audit is a comprehensive evaluation of the entire range of HR activities :-

• HR Cost• HRD activities• Health, Env. & Safety • Legal Compliance• Quality• Compensation & Benefits

Why ?... Organisations undertake HR audits for many reasons :

To make the HR function business-driven. Change of leadership. To take stock of things & to improve HRD for expanding,

diversifying, & entering into a fast growth phase. For growth & diversification. For promoting professionalism among employees & to

switch over to professional Management. To find out the reasons for low productivity & improve HRD

strategies. Dissatisfaction with a particular component. To become employer of choice.

Role of HR Audit in Business Improvements…

HRD audit is cost effective.

It can give many insights into a company's affairs.

It could get the top management to think in terms of strategic and long term business plans.

Changes in the styles of top management

Role clarity of HR Department and the role of line managers in HR

Improvements in HRD systems

Increased focus on human resources and human competencies

Better recruitment policies and more professional staff

More planning and more cost effective training

Strengthening accountabilities through appraisal systems and other mechanisms

Role of HR Audit in Business Improvements…

Before you begin the audit process…

1. Determine who will conduct the audit.

Internal vs. External

2. Secure senior management commitment.

a. Are they ready to fix what’s broken, even if it costs $$$$?

b. Do they agree with the methodology?

c. Will they allow access to all departments/information?

d. Will they publicly support the process?


3. Define the parameters.

a. Who will be audited?

b. What do you want to audit?

c. What audit tools will you use?

d. How will the process be rolled out?

e. How will results get reported?

f. Who will get the results?


4. Introduce the audit process to your managers.

How do you introduce the HR audit to your managers?

1. Explain the reason for it.

a. To protect them and the institution

b. To help them understand policies, procedures, and laws

c. To gain a better understanding of their department

d. To help them set best practice procedures

e. To avoid costly and time consuming litigation

How do you introduce the HR audit to your managers?

2. Give them a copy of the questions before the interview.

If you have an intranet, post the questions on it.

Departmental AuditsWhat should you be concerned about?

Record Keeping

•Sick and vacation tracking

•Overtime reporting

•FMLA application

•Temporary worker tracking•Accessibility/safety/security of records

•Accuracy of records

Employee Files

•What is and isn’t in the employee file

•Access to the file

•Safety and security of the files

Departmental AuditsWhat should you be concerned about? (cont’d)

Manager’s Understanding of Policies/Practices

•How to handle complaints of harassment

•How to calculate/report overtime

•Difference between exempt and non-exempt

•Giving employment references

•Affirmative Action requirements

•FMLA

•Consistency applying policies and procedures

Reporting the Results• Compile your findings in a draft letter

• Allow department head/manager to review your draft and make comments/corrections

• Compile final version

• Present report to senior management

• Copy department head/manager

Remember….

The findings are not negotiable!

Allowing a department head and or manager to review your

draft is not a license for him/her to change your

findings.

Post Audit Scenario No potential appraisal system No career planning system Lack of role clarity Poor induction procedures Absence of mentoring High confusion and friction in values

and approach Human orientaton is missing Operators were treated badly.

HRD Audit in India

Aditya Birla group L&T Crompton Greaves Apollo Tyres Godrej Soaps Tyco Intl BPL

HRD Score Card…

The HRD Scorecard (Rao) is a measure of the HRD maturity level of an organization.

This model is based on the

assumption that: Competent and committed employees are

needed to provide quality products & services at competitive rates & ways that enhance customer satisfaction.

Maturity level of HRD

1. The maturity level of HRD in an organization is indicated by the following factors:- HRD Systems Maturity- HRD Competencies of the Employees including the HR Department- HRD Culture of the Organization- HRD Influence on the Business Goals or Business Linkages of HRD.

HRD Score Card…

These four indices consist of the four pillars of HRD effectiveness. All the four dimensions are assessed using following ten point rating system.

A* Highest Score and Highest Maturity Level A Very High Maturity level B* High Maturity Level B Moderately High Maturity Level C* Moderate Maturity Level C Moderately low Maturity level D* Low Maturity Level D Very low Maturity level F Not at all present

U Ungraded

Name of the Organisation ABC

HRD System Maturity Grade

HRD Competence Score

HRD Culture Grade

Business Linkage Grade

Overall HRD Maturity rating

B* C B* B B*CB*B

Components to be audited

HRD Systems Maturity…

The HRD systems maturity assesses the extent to which various HRD subsystems and tools are well designed & are being implemented.

The systems should be appropriate and relevant to business goals.

It should focus on current and future needs of the corporation.

The HRD strategies and systems should flow from the corporate strategies.


The following subsystems are assessed and depending upon the extent to which they meet the requirements a score is assigned.

Manpower planning and recruitment

Performance Management Systems

Feedback and Coaching Mechanisms

Training

Career development and Succession planning


Job-rotation

OD Interventions

HR Information systems

Worker Development methods and systems

HR Information Systems

Potential Appraisal and Development Other subsystems if any

HRD Competencies in the Corporation…

This dimension indicates the extent to which HRD competencies are well developed in the organisation.

The HRD Staff

The Top Management

Line managers and Supervisory Staff

Union and Association leaders

Workmen, Operators and Grass root level employees


Each of the groups is assessed on :

The level of HRD skills they possess

Their attitudes and support to learning and their own development

Extent to which they facilitate learning among others in the corporation and those who work with them.

Their attitudes and support to HRD function and systems

Internal efficiency of the HRD function (HRD Department)

HRD Staff…

How professionally qualified are they?

Do they seem to demonstrate adequate knowledge base? Are adequately trained in the appropriate HRD systems? Are they sensitive to internal customer requirements?

How good is their skill base in implementing various systems?

Do they demonstrate OCTAPACE values?

Are they quality conscious?

HRD Staff…

Are they familiar with the business goals of the corporation?

Are they cost conscious?

Are they empathetic?

Do they spend adequate time trying to understand the requirements of all categories of employees?

Top Management…

Do they understand HRD and its significance in achieving business goals?

How supportive are they of HRD interventions and values?

Are their leadership styles facilitative of a learning culture?

Are they willing to give the time needed for HRD?

How well do they subscribe to the HRD values like the OCTAPACE values?

How well do they practice HRD values.

How committed are they to create a learning culture in the organisation?

Do they invest their time, effort and energies in employee development?

Line Managers and Supervisory Staff… How much do they understand the significance of

HRD?

Are they interested and motivated to develop themselves?

Are they willing to spend their time and effort in

developing their subordinates?

How supportive are they of HRD efforts?

Do they have listening and other skills required facilitating development of their juniors?

Union and Association Leaders…

How much developmental role are they playing?

Do they see their own role in HRD?

Are they committed to create a learning organisation? Are they willing to promote employee development? Are they positive in their approach and perceive their own

roles a supportive of organisation building?

Do they perceive the significance of Employee development for organisation building?

HRD Function…

Adequacy of manpower

Appropriateness of the structure

Cost consciousness of staff

Quality consciousness of the HRD staff

Responsiveness of the HRD department to the needs of employees, Managers, Staff, Workmen, Union Leaders?

Level of Internal customer satisfaction

Internal operational efficiency of the department?

Level of internal synergy among staff?

Are they the first to implement HRD systems? Do they implement them in an exemplary way?


A HRD Competency maturity core is assigned on the basis of the competency levels of all categories.

A* = All categories of employees have extremely high competence base in HRD (knowledge, attitudes, values and skills) and the HRD department has a high internal efficiency and satisfaction levels.

B = The competence levels of every group is at an acceptable level and the internal efficiency of the HRD department and the internal customer satisfaction are acceptable levels.

D = The competencies of more than one group are below acceptable levels and/or the HRD department is not internally efficient and does not meet the requirements of the minimum internal customer satisfaction.

F = Total failure on almost

HRD Styles, Culture and Values…

The extent to which the leadership and managerial styles are empowering and competence building is assessed by studying the leadership and supervisory styles.

The extent to which the HRD culture and values are practised and stabilised in the corporation are measured.

The HRD culture is culture that promotes Human potential development.

It is also a culture that promotes a learning organisation.

Business Relevance of HRD…

This score indicates the extent to which HRD efforts (tools, processes, culture etc.) are driven to achieve business goals.

The business goals includes: Business Excellence including profitability and other

outcomes the organization is expected to achieve; Internal operational efficiencies; Internal Customer satisfaction; External Customer satisfaction; Employee motivation and commitment; Cost effectiveness and cost consciousness among

employees; Quality orientation;

HR Audit v/s PCMM System...

HR Audit PCMM

Focus is on People & HR practices

Aims at evaluating & improving HRD competencies in any organisation.

Initially aimed at improving workforce practices in software industry.

Based on Quality, TQM & processimprovement models.

Based on HRD - HRD strategies, structure, competencies, styles, & culture & takes into consideration Quality concerns & OD

Does not believe that organisation could be classified into any stage or level, assumes that any Organisation could be assessed on a 10 – point maturity scale on any given dimension.

Conceptualises the organisation as passing through 5 maturity levels, one superior to the other & describes process areas of each level.

The People CMM is a maturity framework that describes the key elements of managing and developing the workforce of an organization. It describes an evolutionary improvement path from an ad hoc approach to managing the work-force, to a mature, disciplined development of the knowledge, skills, and motivation of the people that fuels enhanced business performance.

The People CMM helps organizations to characterize the maturity of their human

resource practices set priorities for improving the competence

of its work-force integrate competence growth with process

improvement establish a culture of workforce excellence

Maturity levels of P-CMM

PCMM Maturity Framework...

Level 4Predictable

Level 3Defined

Level 5Optimizing

Competency Management

Capability Management

Empowered & measured practices

Level 2Managed

Competencybased practices

Continuously Improving practices

People Management

Level 1Initial

Key process areas……..

P-CMM has identified the following acceptance criteria for each Key Process Area:

Goals; Commitments to perform; Abilities to perform; Activities performed; Measurement and analysis Verification of implementation

The outputs of each level serve as the foundation for the practices of subsequent maturity levels. This is best

described through the four themes of the model. Themes: Through these themes, the implementation of

processes at one maturity level can serve as a foundation for practices and capabilities at a higher level. The Themes of the P-CMM are:

Developing Capabilities: Building Teams and Culture: Motivating and Managing Performance: Shaping The Workforce:

http://www.msi.ms/MSJ/People-Capability_Maturity_Model.htm

http://www.sei.cmu.edu/cmm-p/

hr audit,score card, pcmm

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